Document:

Exhibit 10.1

 

EXECUTION VERSION

 

AMENDMENT NO. 1 TO

CREDIT AGREEMENT

 

This AMENDMENT NO. 1 TO CREDIT AGREEMENT dated as of July 1,
2008 (this “Amendment”), by and among by and among (a) STAPLES, INC. (the “Borrower”),
a Delaware corporation having its principal place of business at 500 Staples
Drive, Framingham, MA 01701, (b) the lending institutions listed under the
caption “Lenders” on signature pages hereto (the “Lenders”), (c) LEHMAN BROTHERS COMMERCIAL
PAPER INC., as administrative agent (in such capacity, the “Administrative  Agent”)
for the Lenders and (d) BANK OF AMERICA,
N.A. and HSBC BANK USA, NATIONAL ASSOCIATION,  as  co-syndication agents for the Lenders (collectively, the “Co-Syndication  Agents”),
amends certain provisions of that certain Credit Agreement, dated as of April 1,
2008 among the Borrower, the Lenders, the Syndication Agent, the Co-Documentation
Agents and the Administrative Agent (as amended and in effect from time to
time, the “Credit Agreement”). 
Capitalized terms used herein without definition shall have the meanings
assigned to such terms in the Credit Agreement.

 

WHEREAS,  the Borrower, the Administrative Agent and the Lenders
desire to amend certain provisions of the Credit Agreement as provided more
fully herein below;

 

NOW THEREFORE,  in consideration of the mutual agreements contained in the
Credit Agreement and herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

 

§1.          Amendment
to Section 1.1 (Definitions).  Section 1.1 of the Credit Agreement shall
be amended by amending the following definitions (to the extent already
included in said Section 1.1) and adding the following definitions in the
appropriate alphabetical location (to the extent not already included in said Section 1.1):

 

CXP  Australian  Indebtedness.
 Indebtedness of Subsidiaries of
Corporate Express incorporated or doing business in Australia (“CXP  Australia”)
under one or more credit facilities or similar agreements as in effect as of
the Closing Date and as may be amended or otherwise modified thereafter from
time to time including any refinancing thereof or replacement credit facility
therefor incurred by CXP Australia; provided that the aggregate amount
of such Indebtedness shall not exceed $200,000,000 (or equivalent in other
currencies) outstanding at any time.

 

CXP  Securitization  Indebtedness.  Indebtedness of Corporate Express and its
Subsidiaries in respect of receivables securitization transactions existing as
of the Closing Date and as may be amended or otherwise modified thereafter from
time to time including any refinancing thereof or replacement receivables
securitization transaction by Corporate Express and its Subsidiaries (which may
at any time from and after the Closing Date be guaranteed by the Borrower); provided
that the aggregate amount of such Indebtedness shall not exceed $300,000,000 (or
equivalent in other currencies) outstanding at any time.

 

 

Excluded  Indebtedness.  Any Indebtedness permitted under §§6.1(a),
(b), (c), (d), (e), (f), (g), (h), (j), (k), (l), (n) (subject to clause (A) of
the immediately following proviso), (o), (q) (subject to clause (B) of
the immediately following proviso) or (r) hereof; provided that (A) the
only Indebtedness incurred under §6.1(n) hereof that shall constitute
Excluded Indebtedness shall be (i) Indebtedness of Subsidiaries under
working capital credit lines or facilities (whether or not committed) in an
aggregate principal amount not exceeding $250,000,000 at any time outstanding
(which Indebtedness may be guaranteed by the Borrower), (ii) Indebtedness
constituting Anticipatory Commercial Paper hereunder or additional commercial
paper issued by the Borrower after the Closing Date, (iii) the Incremental
Term Loan, (iv) Indebtedness in respect of standby letters of credit and (v) from
and after the Closing Date, the CXP Australian Indebtedness and (B) the
only Indebtedness incurred under §6.1(q) hereof that shall constitute
Excluded Indebtedness shall be the CXP Securitization Indebtedness.

 

Incremental  Term  Loan.  Indebtedness of the Borrower (which may be
guaranteed by the Guarantors) under the Credit Agreement dated as of July 1,
2008, as amended, by and among the
Borrower, the lending institutions party thereto and Lehman Commercial Paper
Inc. as administrative agent for such lending institutions; provided
that the aggregate amount of such Indebtedness shall not exceed $400,000,000
outstanding at any time.

 

§2.          Affirmation
and Acknowledgment.  Each of the Borrower and the
Guarantors hereby ratifies and confirms all of its Obligations to the Lenders
and the Administrative Agent, including, without limitation, the Loans, and the
Borrower hereby affirms its absolute and unconditional promise to pay to the
Lenders the Loans, the Obligations, and all other amounts due under the Credit
Agreement as amended hereby and each Guarantor hereby affirms its obligations
in respect of the Guaranty to which it is a party and all other Obligations
payable by it under the Loan Documents.

 

§3.          Representations
and Warranties.  The Borrower hereby represents and
warrants to the Lenders and the Administrative Agent as follows:

 

(a)           The
execution, delivery and performance by the Borrower of this Amendment and the
transactions contemplated hereby (i) are within the corporate authority of
the Borrower, (ii) have been duly authorized by all necessary corporate
proceedings, (iii) do not conflict with or result in any breach or
contravention of any provision of law, statute, rule or regulation to
which the Borrower is subject which would have a material adverse effect either
individually or in the aggregate on the Borrower and its Subsidiaries taken as
a whole or on the ability of the Borrower to fulfill its obligations under the
Credit Agreement and the other Loan Documents to which it is a party, (iv) do
not conflict with or result in any breach or contravention of any judgment,
order, writ, injunction, license or permit applicable to the Borrower and (v) do
not conflict with any provision of the corporate charter or bylaws of, or any
agreement or other instrument binding upon, the Borrower.

 

(b)           The execution
and delivery of this Amendment will result in valid and legally binding
obligations of the Borrower enforceable against it in accordance with the
respective terms and provisions hereof and thereof, except as enforceability is
limited by bankruptcy, 

 

2

 

insolvency,
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors’ rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought.

 

(c)           The execution,
delivery and performance by the Borrower of this Amendment and the transactions
contemplated hereby do not require the approval or consent of, or filing with,
any governmental agency or authority other than those already obtained.

 

(d)           Each of the
representations and warranties of the Borrower and its Subsidiaries contained
in the Credit Agreement, the other Loan Documents or in any document or
instrument delivered pursuant to or in connection with this Amendment shall be
true as of the date hereof, with the same effect as if made at and as of the
date hereof (except to the extent of changes resulting from transactions
contemplated or permitted by the Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.

 

§4.          Conditions.  This Amendment shall
become effective upon the satisfaction of the following conditions precedent:

 

(a)           this
Amendment and all related documents, as applicable, shall have been duly
executed and delivered by the Borrower, the Required Lenders, the
Administrative Agent and each other party thereto, as applicable, and shall be
in full force and effect; and

 

(b)           all corporate
action necessary for the valid execution, delivery and performance by the
Borrower of this Amendment and each of the related documents to which it is or
is to become a party, shall have been duly and effectively taken, and evidence
thereof reasonably satisfactory to the Administrative Agent shall have been
provided to the Administrative Agent.

 

§5.          Miscellaneous
Provisions.

 

§5.1.       Except
as otherwise expressly provided by this Amendment, all of the terms, conditions
and provisions of the Credit Agreement and the Loan Documents shall remain the
same.  It is declared and agreed by each
of the parties hereto that the Credit Agreement and the Loan Documents, as
amended hereby, shall continue in full force and effect, and that this
Amendment and the Credit Agreement and the Loan Documents shall be read and
construed as one instrument.  All
references in the Credit Agreement or any related agreement or instrument to
the Credit Agreement shall hereafter refer to the Credit Agreement as amended
hereby.

 

§5.2.       This
Amendment shall be construed according to and governed by the laws of the State
of New York (excluding the laws applicable to conflicts or choice of law).

 

§5.3.       This
Amendment may be executed in any number of counterparts, but all such
counterparts shall together constitute but one instrument.  In making proof of this Amendment, it shall
not be necessary to produce or account for more than one counterpart signed by
each party hereto by and against which enforcement hereof is sought.

 

3

 

§5.4.       The
Borrower hereby agrees to pay to the Administrative Agent, on demand by the
Administrative Agent, all reasonable out-of-pocket costs and expenses incurred
or sustained by the Administrative Agent in connection with the preparation of
this Amendment (including reasonable legal fees).

 

§5.5.       This
Amendment shall constitute a Loan Document under the Credit Agreement, and all
obligations included in this Amendment (including, without limitation, all
obligations for the payment of principal, interest, fees, and other amounts and
expenses) shall constitute Obligations under the Loan Documents.

 

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY
BLANK]

 

4

 

	
   

  	
  STAPLES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
       /s/      Nicholas
  Hotchkin

  
	
   

  	
  Name: Nicholas Hotchkin

  
	
   

  	
  Title: Senior Vice President, Finance and Treasurer

  

 

 

 

	
   

  	
  LEHMAN COMMERCIAL PAPER INC., as 

  Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
       /s/      Ahuva
  Schwager

  
	
   

  	
  Name: Ahuva Schwager

  
	
   

  	
  Title: Authorized Signatory

  

 

 

	
   

  	
  LENDERS

  
	
   

  	
   

  
	
   

  	
  LEHMAN COMMERCIAL PAPER INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
       /s/      Ahuva
  Schwager

  
	
   

  	
  Name: Ahuva Schwager

  
	
   

  	
  Title: Authorized Signatory

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
       /s/      Thomas
  J. Kane

  
	
   

  	
  Name: Thomas J. Kane

  
	
   

  	
  Title: SVP

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HSBC BANK USA, NATIONAL 

  ASSOCIATION,

  
	
   

  	
  as Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
       /s/      Robert
  J. Devir

  
	
   

  	
  Name: Robert J Devir

  
	
   

  	
  Title: Managing Director

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  KEY BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

	
  Acknowledged and Agreed:

  	
   

  
	
   

  	
   

  
	
  GUARANTORS

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  STAPLES THE OFFICE SUPERSTORE, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
               /s/          Nicholas
  Hotchkin

  	
   

  
	
  Name: Nicholas Hotchkin

  	
   

  
	
  Title: Senior Vice President, Finance and
  Treasurer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  STAPLES THE OFFICE SUPERSTORE EAST, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
               /s/          Nicholas
  Hotchkin

  	
   

  
	
  Name: Nicholas Hotchkin

  	
   

  
	
  Title: Senior Vice President, Finance and
  Treasurer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  STAPLES
  CONTRACT & COMMERCIAL, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
               /s/          Nicholas
  Hotchkin

  	
   

  
	
  Name: Nicholas Hotchkin

  	
   

  
	
  Title: Senior Vice President, Finance and
  Treasurer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  STAPLES THE OFFICE SUPERSTORE, LIMITED
  PARTNERSHIP

  	
   

  
	
  By its General Partner: Staples, Inc.

  	
   

  
	
   

  	
   

  	
   

  
	
  By: 

  	
               /s/          Nicholas
  Hotchkin

  	
   

  
	
  Name: Nicholas Hotchkin

  	
   

  
	
  Title: Senior Vice President, Finance and
  TreasurerExhibit
10.2

 

EXECUTION
VERSION

 

CREDIT AGREEMENT

 

dated as of July 1, 2008

 

STAPLES, INC.

 

THE LENDERS NAMED HEREIN,

 

LEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent,

 

BANK OF AMERICA, N.A.

and

HSBC BANK USA, NATIONAL ASSOCIATION,

as Co-Syndication Agents,

 

with

 

LEHMAN BROTHERS INC.,

BANC OF AMERICA SECURITIES LLC,

and

HSBC SECURITIES (USA) INC.,

as Joint Lead Arrangers and Joint Bookrunners

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  §1.

  	
  DEFINITIONS AND
  RULES OF INTERPRETATION

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  §1.1.

  	
  Definitions

  	
  1

  
	
   

  	
  §1.2.

  	
  Rules of Interpretation

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  §2.

  	
  THE CREDIT
  FACILITY

  	
  17

  
	
   

  	
   

  	
   

  
	
   

  	
  §2.1.

  	
  Commitment to Lend Loans

  	
  17

  
	
   

  	
  §2.2.

  	
  Requests for Loans

  	
  17

  
	
   

  	
  §2.3.

  	
  Funds for Loans

  	
  18

  
	
   

  	
   

  	
  §2.3.1.

  	
  Funding Procedures

  	
  18

  
	
   

  	
   

  	
  §2.3.2.

  	
  Advances by Administrative Agent

  	
  18

  
	
   

  	
  §2.4.

  	
  Reduction of Total
  Commitment

  	
  19

  
	
   

  	
  §2.5.

  	
  Maturity of Loans

  	
  19

  
	
   

  	
  §2.6.

  	
  [Reserved]

  	
  19

  
	
   

  	
  §2.7.

  	
  Optional Repayments of Loans

  	
  20

  
	
   

  	
  §2.8.

  	
  Interest on Loans

  	
  20

  
	
   

  	
  §2.9.

  	
  Conversion Options

  	
  20

  
	
   

  	
   

  	
  §2.9.1.

  	
  Conversion to Different Type of Loan

  	
  20

  
	
   

  	
   

  	
  §2.9.2.

  	
  Continuation of Type of Loan

  	
  21

  
	
   

  	
   

  	
  §2.9.3.

  	
  Eurocurrency Rate Loans

  	
  21

  
	
   

  	
  §2.10.

  	
  Evidence of Debt

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  §3.

  	
  CERTAIN GENERAL
  PROVISIONS; FEES

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
  §3.1.

  	
  Administrative Agent Fees

  	
  22

  
	
   

  	
  §3.2.

  	
  Duration Fees

  	
  22

  
	
   

  	
  §3.3.

  	
  Funds for Payments

  	
  22

  
	
   

  	
   

  	
  §3.3.1.

  	
  Payments to Administrative Agent

  	
  22

  
	
   

  	
   

  	
  §3.3.2.

  	
  No Offset, Etc.

  	
  22

  
	
   

  	
   

  	
  §3.3.3.

  	
  Withholding

  	
  23

  
	
   

  	
  §3.4.

  	
  Computations

  	
  24

  
	
   

  	
  §3.5.

  	
  Inability to Determine Eurocurrency Rate

  	
  24

  

 

i

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §3.6.

  	
  Illegality

  	
  25

  
	
   

  	
  §3.7.

  	
  Additional Costs, Etc.

  	
  25

  
	
   

  	
  §3.8.

  	
  Capital Adequacy

  	
  26

  
	
   

  	
  §3.9.

  	
  Certificate

  	
  27

  
	
   

  	
  §3.10.

  	
  Indemnity

  	
  27

  
	
   

  	
  §3.11.

  	
  Interest After Default

  	
  27

  
	
   

  	
  §3.12.

  	
  Replacement of Individual Lenders

  	
  27

  
	
   

  	
  §3.13.

  	
  Additional Reserve Requirements

  	
  28

  
	
   

  	
  §3.14.

  	
  Guaranties

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
  §4.

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  29

  
	
   

  	
   

  	
   

  
	
   

  	
  §4.1.

  	
  Corporate Authority

  	
  29

  
	
   

  	
   

  	
  §4.1.1.

  	
  Incorporation; Good Standing

  	
  29

  
	
   

  	
   

  	
  §4.1.2.

  	
  Authorization

  	
  29

  
	
   

  	
   

  	
  §4.1.3.

  	
  Enforceability

  	
  30

  
	
   

  	
  §4.2.

  	
  Governmental Approvals

  	
  30

  
	
   

  	
  §4.3.

  	
  Title to Properties; Leases

  	
  30

  
	
   

  	
  §4.4.

  	
  Financial Statements; Fiscal Year

  	
  30

  
	
   

  	
  §4.5.

  	
  No Material Changes, Etc.

  	
  30

  
	
   

  	
  §4.6.

  	
  Franchises, Patents, Copyrights, Etc.

  	
  31

  
	
   

  	
  §4.7.

  	
  Litigation

  	
  31

  
	
   

  	
  §4.8.

  	
  Compliance with Other Instruments, Laws, Etc.

  	
  31

  
	
   

  	
  §4.9.

  	
  Tax Status

  	
  31

  
	
   

  	
  §4.10.

  	
  No Event of Default

  	
  32

  
	
   

  	
  §4.11.

  	
  Investment Company Act

  	
  32

  
	
   

  	
  §4.12.

  	
  Employee Benefit Plans

  	
  32

  
	
   

  	
   

  	
  §4.12.1.

  	
  In General

  	
  32

  
	
   

  	
   

  	
  §4.12.2.

  	
  Terminability of Welfare Plans

  	
  32

  
	
   

  	
   

  	
  §4.12.3.

  	
  Guaranteed Pension Plans

  	
  32

  
	
   

  	
   

  	
  §4.12.4.

  	
  Multiemployer Plans

  	
  33

  
	
   

  	
  §4.13.

  	
  Regulations U and X, Etc.

  	
  33

  

 

ii

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §4.14.

  	
  Environmental Compliance

  	
  33

  
	
   

  	
  §4.15.

  	
  Foreign Assets Control
  Regulations, Etc.

  	
  34

  
	
   

  	
  §4.16.

  	
  Subsidiaries, Etc.

  	
  34

  
	
   

  	
  §4.17.

  	
  Taxpayer Identification
  Numbers

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  §5.

  	
  AFFIRMATIVE
  COVENANTS OF THE BORROWER

  	
  35

  
	
   

  	
   

  	
   

  
	
   

  	
  §5.1.

  	
  Punctual Payment

  	
  35

  
	
   

  	
  §5.2.

  	
  Maintenance of Office

  	
  35

  
	
   

  	
  §5.3.

  	
  Records and Accounts

  	
  35

  
	
   

  	
  §5.4.

  	
  Financial Statements, Certificates and Information

  	
  35

  
	
   

  	
  §5.5.

  	
  Notices

  	
  38

  
	
   

  	
  §5.6.

  	
  Legal Existence; Maintenance of Properties

  	
  38

  
	
   

  	
  §5.7.

  	
  Insurance

  	
  39

  
	
   

  	
  §5.8.

  	
  Taxes

  	
  39

  
	
   

  	
  §5.9.

  	
  Inspection of Properties and Books, Etc.

  	
  39

  
	
   

  	
  §5.10.

  	
  Compliance with Laws, Contracts, Licenses, and
  Permits

  	
  40

  
	
   

  	
  §5.11.

  	
  Employee Benefit Plans

  	
  40

  
	
   

  	
  §5.12.

  	
  Use of Proceeds

  	
  40

  
	
   

  	
  §5.13.

  	
  Licenses and Permits

  	
  40

  
	
   

  	
  §5.14.

  	
  Guaranties

  	
  40

  
	
   

  	
  §5.15.

  	
  Further Assurances

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  §6.

  	
  CERTAIN
  NEGATIVE COVENANTS OF THE BORROWER

  	
  41

  
	
   

  	
   

  	
   

  
	
   

  	
  §6.1.

  	
  Restrictions on Indebtedness

  	
  41

  
	
   

  	
  §6.2.

  	
  Restrictions on Liens

  	
  43

  
	
   

  	
  §6.3.

  	
  Restrictions on Investments

  	
  45

  
	
   

  	
  §6.4.

  	
  Distributions

  	
  46

  
	
   

  	
  §6.5.

  	
  Employee Benefit Plans

  	
  47

  
	
   

  	
  §6.6.

  	
  Merger and Consolidation; Acquisitions

  	
  47

  
	
   

  	
  §6.7.

  	
  Disposition of Assets and Sale-Leaseback
  Transactions

  	
  47

  
	
   

  	
  §6.8.

  	
  Subordinated Debt

  	
  48

  
	
   

  	
  §6.9.

  	
  Transactions with
  Affiliates

  	
  48

  

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  §7.

  	
  FINANCIAL
  COVENANTS OF THE BORROWER

  	
  48

  
	
   

  	
   

  	
   

  
	
   

  	
  §7.1.

  	
  Fixed Charge Coverage Ratio

  	
  48

  
	
   

  	
  §7.2.

  	
  Adjusted Funded Debt to Total Capitalization Ratio

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  §8.

  	
  EFFECTIVE DATE
  CONDITIONS

  	
  49

  
	
   

  	
   

  	
   

  
	
   

  	
  §8.1.

  	
  Loan Documents

  	
  49

  
	
   

  	
  §8.2.

  	
  Certified Copies of Charter Documents

  	
  49

  
	
   

  	
  §8.3.

  	
  Corporate Action

  	
  49

  
	
   

  	
  §8.4.

  	
  Incumbency Certificate

  	
  49

  
	
   

  	
  §8.5.

  	
  Opinion of Counsel

  	
  49

  
	
   

  	
  §8.6.

  	
  Payment of Fees

  	
  50

  
	
   

  	
  §8.7.

  	
  Financial Statements

  	
  50

  
	
   

  	
  §8.8.

  	
  Specified Representations True; No Default

  	
  50

  
	
   

  	
  §8.9.

  	
  No Default under Material Indebtedness

  	
  50

  
	
   

  	
  §8.10.

  	
  Governmental Regulation

  	
  50

  
	
   

  	
  §8.11.

  	
  USA Patriot Act

  	
  50

  
	
   

  	
  §8.12.

  	
  Effective Date Certificate

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
  §9.

  	
  CLOSING DATE
  CONDITIONS

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §9.1.

  	
  Effective Date

  	
  51

  
	
   

  	
  §9.2.

  	
  Offer Consummation

  	
  51

  
	
   

  	
  §9.3.

  	
  Approvals

  	
  51

  
	
   

  	
  §9.4.

  	
  Opinion of Counsel

  	
  51

  
	
   

  	
  §9.5.

  	
  Payment of Fees

  	
  51

  
	
   

  	
  §9.6.

  	
  Pro Forma Financial Statements

  	
  52

  
	
   

  	
  §9.7.

  	
  Specified Representations True; No Default; No
  Default under Material Indebtedness

  	
  52

  
	
   

  	
  §9.8.

  	
  Amendment to Bridge Credit Agreement

  	
  53

  
	
   

  	
  §9.9.

  	
  Closing Date Certificate

  	
  53

  
	
  §10.

  	
  [RESERVED]

  	
  53

  
	
  §11.

  	
  [RESERVED]

  	
  53

  
	
  §12.

  	
  EVENTS OF
  DEFAULT; ACCELERATION; ETC.

  	
  53

  
	
   

  	
   

  	
  §12.1.

  	
  Events of Default and Acceleration

  	
  53

  

 

iv

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  §12.2.

  	
  Termination of Commitments

  	
  57

  
	
   

  	
   

  	
  §12.3.

  	
  Remedies

  	
  57

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §13.

  	
  SETOFF

  	
  57

  
	
   

  	
   

  	
   

  
	
  §14.

  	
  THE
  ADMINISTRATIVE AGENT

  	
  58

  
	
   

  	
   

  	
   

  
	
   

  	
  §14.1.

  	
  Authorization

  	
  58

  
	
   

  	
  §14.2.

  	
  Employees and Agents

  	
  59

  
	
   

  	
  §14.3.

  	
  No Liability

  	
  59

  
	
   

  	
  §14.4.

  	
  No Representations

  	
  60

  
	
   

  	
   

  	
  §14.4.1.

  	
  General

  	
  60

  
	
   

  	
   

  	
  §14.4.2.

  	
  Closing Documentation, etc.

  	
  61

  
	
   

  	
  §14.5.

  	
  Payments

  	
  61

  
	
   

  	
   

  	
  §14.5.1.

  	
  Payments to Administrative Agent

  	
  61

  
	
   

  	
   

  	
  §14.5.2.

  	
  Distribution by Administrative Agent

  	
  61

  
	
   

  	
   

  	
  §14.5.3.

  	
  Delinquent Lenders

  	
  61

  
	
   

  	
  §14.6.

  	
  Holders of Notes

  	
  62

  
	
   

  	
  §14.7.

  	
  Indemnity

  	
  62

  
	
   

  	
  §14.8.

  	
  Administrative Agent as Lender; Etc.

  	
  62

  
	
   

  	
  §14.9.

  	
  Resignation

  	
  62

  
	
   

  	
  §14.10.

  	
  Notification of Defaults and Events of Default

  	
  63

  
	
   

  	
  §14.11.

  	
  Administrative Agent
  May File Proofs of Claim

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
  §15.

  	
  EXPENSES

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §16.

  	
  INDEMNIFICATION

  	
  65

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §17.

  	
  SURVIVAL OF
  COVENANTS, ETC.

  	
  66

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §18.

  	
  ASSIGNMENT AND
  PARTICIPATION

  	
  66

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §18.1.

  	
  General Conditions and Conditions to Assignment

  	
  66

  
	
   

  	
  §18.2.

  	
  Certain Representations and Warranties; Limitations;
  Covenants

  	
  68

  
	
   

  	
  §18.3.

  	
  Register

  	
  69

  
	
   

  	
  §18.4.

  	
  Participations

  	
  69

  
	
   

  	
  §18.5.

  	
  Limitation upon
  Participant Rights

  	
  70

  
	
   

  	
  §18.6.

  	
  Assignee or Participant Affiliated with the Borrower

  	
  70

  

 

v

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  §18.7.

  	
  Miscellaneous Assignment Provisions

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
  §19.

  	
  NOTICES, ETC.

  	
  71

  
	
   

  	
   

  	
   

  
	
  §20.

  	
  GOVERNING LAW

  	
  73

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §21.

  	
  HEADINGS

  	
  73

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §22.

  	
  COUNTERPARTS

  	
  73

  
	
   

  	
   

  	
   

  
	
  §23.

  	
  ENTIRE
  AGREEMENT, ETC.

  	
  73

  
	
   

  	
   

  	
   

  
	
  §24.

  	
  WAIVER OF JURY
  TRIAL

  	
  73

  
	
   

  	
   

  	
   

  
	
  §25.

  	
  CONSENTS,
  AMENDMENTS, WAIVERS, ETC.

  	
  74

  
	
   

  	
   

  	
   

  
	
  §26.

  	
  TREATMENT OF
  CERTAIN CONFIDENTIAL INFORMATION

  	
  75

  
	
   

  	
   

  	
   

  
	
   

  	
  §26.1.

  	
  Confidentiality

  	
  75

  
	
   

  	
  §26.2.

  	
  Prior Notification

  	
  75

  
	
   

  	
  §26.3.

  	
  Other

  	
  76

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  §27.

  	
  SEVERABILITY

  	
  76

  
	
   

  	
   

  	
   

  
	
  §28.

  	
  USA PATRIOT ACT
  NOTICE

  	
  76

  
	
   

  	
   

  	
   

  
	
  §29.

  	
  NO ADVISORY OR
  FIDUCIARY RESPONSIBILITY

  	
  76

  
	
   

  	
   

  	
   

  
	
  §30.

  	
  COLLATERAL

  	
  77

  

 

vi

 

EXHIBITS
AND SCHEDULES

 

	
   

  	
  Exhibit A

  	
  Form of Loan Request

  
	
   

  	
  Exhibit B

  	
  Form of Guaranty

  
	
   

  	
  Exhibit C

  	
  Form of Compliance Certificate

  
	
   

  	
  Exhibit D

  	
  Form of Assignment and Assumption

  
	
   

  	
  Exhibit E

  	
  Form of Joinder Agreement

  
	
   

  	
   

  	
   

  
	
   

  	
  Schedule 1

  	
  Lenders

  
	
   

  	
  Schedule 2

  	
  Guarantors

  
	
   

  	
  Schedule 4.3

  	
  Title to Properties, Leases

  
	
   

  	
  Schedule 4.7

  	
  Litigation

  
	
   

  	
  Schedule 4.9

  	
  Taxes

  
	
   

  	
  Schedule 4.12

  	
  Pension Liabilities

  
	
   

  	
  Schedule 4.14

  	
  Environmental Compliance

  
	
   

  	
  Schedule 4.16(a)

  	
  Subsidiaries

  
	
   

  	
  Schedule 4.16(b)

  	
  Joint Ventures and Partnerships

  
	
   

  	
  Schedule 4.16(c)

  	
  Equity Interests of 50% or Less

  
	
   

  	
  Schedule 4.17

  	
  Tax Payer Identification Numbers

  
	
   

  	
  Schedule 6.1

  	
  Existing Indebtedness

  
	
   

  	
  Schedule 6.2

  	
  Existing Liens

  
	
   

  	
  Schedule 6.3

  	
  Existing Investments

  

 

 

CREDIT AGREEMENT

 

This CREDIT AGREEMENT,  dated as of July 1, 2008, is by and among (a) STAPLES, INC. (the “Borrower”), a Delaware
corporation having its principal place of business at 500 Staples Drive,
Framingham, MA 01701, (b) the lending institutions listed on Schedule
1 hereto (the “Lenders”), (c) LEHMAN BROTHERS COMMERCIAL PAPER INC., as administrative
agent (in such capacity, the “Administrative
Agent”) for the Lenders and (d) BANK
OF AMERICA, N.A. and HSBC BANK USA, NATIONAL ASSOCIATION,  as  co-syndication agents for the Lenders (collectively, the “Co-Syndication
Agents”).

 

WHEREAS, the Lenders are willing to make loans to the Borrower, all on the
terms and conditions set forth herein.

 

NOW THEREFORE, in consideration of the foregoing, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged (these recitals being an integral part of this Credit
Agreement), the Borrower, the Administrative Agent and the Lenders hereby agree
as follows:

 

§1.                               DEFINITIONS
AND RULES OF INTERPRETATION.

 

§1.1.                    Definitions. The following terms shall have the meanings
set forth in this §1 or elsewhere in the provisions of this Credit Agreement
referred to below:

 

Adjustment
Date. The date which is three (3) Business Days after each
Compliance Certificate is delivered by the Borrower pursuant to §§5.4(a) and
(b) hereof.

 

Administrative
Agent. As defined in the preamble hereto.

 

Administrative
Agent  Fees. See §3.1 hereof.

 

Administrative
Agent’s  Special  Counsel. Milbank, Tweed, Hadley &
McCloy LLP or such other counsel as may be approved by the Administrative
Agent.

 

Administrative
Questionnaire. An Administrative Questionnaire in a form supplied by the
Administrative Agent.

 

Affiliate. Any
Person that would be considered to be an affiliate of a Person under Rule 144(a) of
the Rules and Regulations of the SEC, as in effect on the Effective Date,
if such Person were issuing securities.

 

AFM. Stichting
Autoriteit Financiële Markten (the Netherlands Authority for the Financial
Markets).

 

Agent  Parties.
See §14.3 hereof.

 

 

Applicable  Margin.
The Applicable Margin shall be in effect for each period commencing on an
Adjustment Date through the date immediately preceding the next Adjustment Date
(each a “Rate  Adjustment  Period”) based on a determination
of the Senior Debt Rating. The Senior Debt Rating shall be determined as of the
last day of the preceding Rate Adjustment Period. The Applicable Margin shall
be the applicable rate per annum, corresponding to the lower of the Levels set
forth in the table below (with Level I being the lowest level and Level IV
being the highest level) corresponding to the Senior Debt Rating. In the event
that the Senior Debt Ratings assigned by Moody’s and S&P are not
equivalent, the following criteria shall determine which Level shall be
applicable to the Senior Debt Rating: (a) if the Senior Debt Ratings are
one Level apart, the Level applicable to the Senior Debt Rating shall be the
lower of the two Levels and (b) if the Senior Debt Ratings are more than
one Level apart, the Level applicable to the Senior Debt Rating shall be one
Level above (i.e., towards Level IV) the lower of the two Levels. For purposes
of clarity, the parties hereto acknowledge that (i) the Applicable Margin
with respect to Base Rate Loans shall be the rate per annum set forth in column
C in the table below (as such Applicable Margin shall be adjusted pursuant to
the last paragraph of this definition) and (ii) the Applicable Margin with
respect to Eurocurrency Rate Loans shall be the rate per annum set forth in
column D in the table below (as such Applicable Margin shall be adjusted
pursuant to the last paragraph of this definition).

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  D

  	
   

  
	
  A

  Level

  	
   

  	
  B

  Senior Debt Rating

  	
   

  	
  C

  Base Rate Loans

  	
   

  	
  Eurocurrency Rate

  Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  I

  	
   

  	
  S&P: BBB+ or better
  Moody’s: Baa1 or better

  	
   

  	
  0.25

  	
  %

  	
  1.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  II

  	
   

  	
  S&P: BBB Moody’s:
  Baa2

  	
   

  	
  0.50

  	
  %

  	
  1.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III

  	
   

  	
  S&P: BBB-Moody’s:
  Baa3

  	
   

  	
  0.75

  	
  %

  	
  1.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IV

  	
   

  	
  S&P: Lower than
  BBB-Moody’s: Lower than Baa3

  	
   

  	
  1.50

  	
  %

  	
  2.50

  	
  %

  

 

Notwithstanding the foregoing, if the Borrower fails to deliver any
Compliance Certificate pursuant to §§5.4(a) or (b) hereof then, for
the period commencing on the date such Compliance Certificate was due through
the date immediately preceding the Adjustment Date that occurs immediately
following the date on which such Compliance Certificate is delivered, the
Applicable Margin shall be the Applicable Margin corresponding to Level IV
above.

 

2

 

Applicable  Pension
Legislation. At any time, any pension or retirement benefits legislation
(be it national, federal, provincial, territorial or otherwise) then applicable
to the Borrower or any of its Subsidiaries.

 

Approved  Fund.
Any Fund that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

 

Arranger. Lehman Brothers Inc.

 

Assignment  and
Assumption. See §18.1 hereof.

 

Balance  Sheet
Date. February 2, 2008.

 

Base  Rate.
The higher of (a) the Prime Rate and (b) one-half of one percent
(1/2%) per annum above the Federal Funds Effective Rate. Any change in the Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective as of the opening of business on the effective day of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.

 

Base  Rate
Loans. Any Loans bearing interest calculated by reference to the Base
Rate.

 

Borrower. As
defined in the preamble hereto.

 

Borrower  Materials.
See §5.4(e) hereof.

 

Bridge  Credit
Agreement. That certain Credit Agreement dated as of April 1, 2008,
as amended, by and among the Borrower, the lending institutions party thereto,
Bank of America, N.A and HSBC Bank USA, National Association as co-syndication
gents and LCPI. as administrative agent for such lending institutions.

 

Business  Day.
Any day on which banking institutions in New York, New York, are open for the
transaction of banking business and, if such day relates to any interest rate
settings as to a Eurocurrency Rate Loan, any fundings, disbursements,
settlements and payments in respect of any such Eurocurrency Rate Loan, or any
other dealings to be carried out pursuant to this Credit Agreement in respect
of any such Eurocurrency Rate Loan, means any such day on which dealings in
deposits in Dollars are conducted by and between banks in the London interbank
eurodollar market.

 

Capital  Stock.
With respect to any corporation, partnership, trust, unincorporated
association, joint venture, limited liability company, or other legal or
business entity, any and all shares, interests, participations or other
equivalent (however designated) of capital stock of such entity, any and all
limited or general partnership interests and equivalent ownership interests in
such entity, any and all warrants and options to purchase any of the foregoing,
and any securities convertible into any of the foregoing.

 

3

 

Capitalized  Leases.
Leases under which the Borrower or any of its Subsidiaries is the lessee or
obligor, the discounted future rental payment obligations under which are
required to be capitalized on the balance sheet of the lessee or obligor in
accordance with GAAP.

 

CERCLA. The
Comprehensive Environmental Response, Compensation and Liability Act of 1980.

 

Closing Date.
The date (which shall be no later than July 11, 2008) on which the
conditions set forth in §9 hereof have been satisfied (or waived in accordance
with §25 hereof).

 

Code. The
Internal Revenue Code of 1986.

 

Commitment. The
agreement of each Lender, subject to the terms and conditions of this Credit
Agreement, to make Loans to the Borrower.

 

Commitment  Amount.
With respect to each Lender, the amount of such Lender’s Commitment set forth
on Schedule  1 hereto or in the Assignment and Assumption pursuant
to which such Lender shall have assumed its Commitment, as applicable, as the
same may be reduced from time to time in accordance with the terms of this
Credit Agreement; or if the Total Commitment is terminated pursuant to the
provisions hereof, zero.

 

Commitment  Fee.
See §3.2 hereof.

 

Commitment  Percentage.
With respect to each Lender, the percentage of the Total Commitment represented
by such Lender’s Commitment. If the Commitments have terminated or expired, the
Commitment Percentages of the Lenders shall be determined based upon the
Commitments most recently in effect, giving effect to any assignments.

 

Compliance  Certificate.
See §5.4(a) hereof.

 

Confidential  Information.
All information relating to the Borrower or any of its Subsidiaries that is
labeled by the Borrower or such Subsidiary as confidential at the time such
information is supplied by the Borrower or such Subsidiary to a Lender, other
than information which (a) is public knowledge or generally available to
the public, or (b) is obtained by any of the Lenders, whether prior to or
after disclosure to such Lender by the Borrower or any of its Subsidiaries,
from a source other than the Borrower or any of its Subsidiaries, provided
that such information is not known by such Lender to have been disclosed by any
party in violation of a confidentiality agreement with the Borrower or any of
its Subsidiaries, any other obligation of nondisclosure with respect to the
Borrower or any of its Subsidiaries or any applicable statutory or regulatory
limitation imposed on the disclosure of such information.

 

4

 

Consolidated  or
consolidated. With reference to any term defined herein, shall mean that
term as applied to the accounts of the Borrower and its Subsidiaries,
consolidated in accordance with GAAP.

 

Consolidated  Adjusted
Funded  Debt. With respect to the Borrower and its Subsidiaries,
as at any date of determination, on a consolidated basis, the aggregate of (a) Consolidated
Total Funded Debt as of such date plus (b) (i) Rental Expense
for the period of twelve consecutive months then ended multiplied  by
(ii) eight (8).

 

Consolidated  EBIT.
For any period, consolidated net income (or deficit) of the Borrower and its
Subsidiaries, after deducting all expenses and other proper charges other than
interest expense, taxes and any noncash nonrecurring charges, and excluding,
without duplication, (a) all extraordinary and nonrecurring items of (i) income
or (ii) cash losses in an aggregate amount not to exceed $100,000,000 on a
cumulative basis from October 13, 2006, as determined in accordance with
GAAP and (b) all income or loss from any corporation, partnership, limited
liability company, joint venture or other entity in which the Borrower or any
of its Subsidiaries holds not more than a fifty percent (50%) ownership
interest, as determined in accordance with GAAP; provided that there
shall be further excluded in calculating consolidated net income (or deficit)
for purposes of this definition, without duplication, any noncash (x) losses
attributable to the use of a fair value methodology for recognition and
measurement of impairment of goodwill not identified with impaired assets in
accordance with Accounting Principles Board Opinion No. 142 and (y) SFAS
123R expenses; provided that, with respect to any such period
in which the Corporate Express Acquisition shall have been consummated,
Consolidated EBIT for such period shall be calculated on a pro forma
basis so as to give effect thereto as of the first day of such period.

 

Consolidated  Total
Assets. All assets of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP.

 

Consolidated  Total
Funded  Debt. With respect to the Borrower and its Subsidiaries,
as at any date of determination, on a consolidated basis, the aggregate
(without duplication) of (a) all outstanding Indebtedness of the Borrower
and its Subsidiaries relating to or in respect of (i) the borrowing of money
or the obtaining of credit, including the issuance of notes or bonds and
standby letters of credit outstanding but excluding documentary letters of
credit, (ii) the deferred purchase price of assets (other than trade
payables incurred in the ordinary course of business), (iii) any Synthetic
Leases or any Capitalized Leases, and (iv) the transactions permitted
under §6.1(q) hereof, plus (b) all Indebtedness of the type
referred to in clause (a) of another Person guaranteed by the Borrower or
any of its Subsidiaries.

 

Consolidated  Total
Interest  Expense. For any period, the aggregate amount of
interest required to be paid or accrued by the Borrower and its Subsidiaries
during such period on all Indebtedness of the Borrower and its Subsidiaries
outstanding during all or any part of such period, whether such interest was or
is required to be reflected as an item of expense or capitalized, including
payments consisting of interest in respect of 

 

5

 

Capitalized Leases and
Synthetic Leases, and including facility fees, commitment fees, usage fees,
agency fees, balance deficiency fees, and similar fees or expenses in
connection with the borrowing of money, as determined in accordance with GAAP; provided that, with respect to any Measurement Period in which the
Corporate Express Acquisition shall have been consummated, Consolidated Total
Interest Expense for such period shall be calculated on a pro forma
basis so as to give effect thereto as of the first day of such period.

 

Contingent  Liabilities.
Any guaranties, endorsements, obligations to reimburse the issuer in respect of
any letters of credit, agreements to purchase or provide funds for the payment
of obligations of others, or other liabilities which would be classified as
contingent in accordance with GAAP consistently applied, excluding, however, (a) product
warranties given in the ordinary course of business, (b) endorsements of
checks or other negotiable instruments for deposit or collection in the
ordinary course of business, and (c) reimbursement obligations in respect
of documentary trade letters of credit.

 

Conversion  Request.
A notice given by the Borrower to the Administrative Agent of the Borrower’s
election to convert or continue a Loan in accordance with §2.9 hereof.

 

Corporate  Express.
Corporate Express N.V., a public limited liability company incorporated under
the laws of The Netherlands.

 

Corporate  Express
Acquisition. The acquisition of Corporate Express Shares and convertible
debt of Corporate Express pursuant to the Offer.

 

Corporate  Express
ADS. The issued and outstanding American Depositary Shares of Corporate
Express, each representing one Corporate Express Ordinary Share, listed on the
New York Stock Exchange.

 

Corporate  Express
Default. See §9.7 hereof.

 

Corporate
Express  Dutch  Shares.  Collectively,  Corporate  Express  Ordinary  Shares  and  Corporate  Express  Preference  Shares  A.

 

Corporate  Express
Material  Indebtedness  Default. See §9.7 hereof.

 

Corporate Express Ordinary Shares. The issued and outstanding ordinary shares,
nominal value €1.20 per share, of Corporate Express, including the ordinary
shares underlying Corporate Express ADS.

 

Corporate Express Preference Shares A. The depositary receipts representing the
issued and outstanding preference Shares A, nominal value €1.20 per share, of
Corporate Express.

 

Corporate  Express-Related
Default. See §9.7 hereof.

 

6

 

Corporate  Express
Shares. Collectively, Corporate Express Dutch Shares and Corporate Express
ADS.

 

Co-Syndication
Agents. As defined in the preamble hereto.

 

Credit  Agreement.
This Credit Agreement, including the Schedules and Exhibits hereto.

 

Default. Any
event or condition which upon notice, lapse of time or both would, unless cured
or waived, become an Event of Default.

 

Delinquent  Lender.
See §14.5.3 hereof.

 

Distribution.
(a) The declaration or payment of any dividend on or in respect of any
shares of any class of Capital Stock of the Borrower, other than dividends
payable solely in shares of common stock of the Borrower; (b) the
purchase, redemption, or other retirement of any shares of any class of Capital
Stock of the Borrower, directly or indirectly through a Subsidiary of the
Borrower or otherwise; (c) the return of capital by the Borrower to its
shareholders as such; or (d) any other distribution on or in respect of
any shares of any class of Capital Stock of the Borrower.

 

Dollars or $.
Dollars in lawful currency of the United States of America.

 

Domestic  Subsidiary.
Any Subsidiary that is organized under the laws of the United States of
America, any state or territory thereof or the District of Columbia.

 

Drawdown  Date.
The date on which any Loan is made or is to be made, and the date on which any
Loan is converted or continued in accordance with §2.9 hereof.

 

Effective  Date.
See §8 hereof.

 

Eligible  Assignee.
Any of (a) a Lender; (b) an Affiliate of a Lender; (c) an
Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, and (ii) unless an Event of
Default has occurred and is continuing, the Borrower (each such approval in the
case of (i) and (ii) not to be unreasonably withheld or delayed, and
in the case of (ii), it being understood that it shall be reasonable for the
Borrower to withhold such approval if the proposed Person does not have an
investment grade rating).

 

Employee  Benefit
Plan. Any employee benefit plan within the meaning of §3(3) of
ERISA maintained or contributed to by the Borrower, other than a Guaranteed
Pension Plan or a Multiemployer Plan.

 

Environmental
Laws. Any judgment, decree, order, law, license, rule or regulation
pertaining to environmental matters, including without limitation, those
arising under the Resource Conservation and Recovery Act (“RCRA”), CERCLA, the Superfund Amendments and Reauthorization Act of
1986 (“SARA”), the Federal Clean Water Act,

 

7

 

the Federal Clean Air Act,
the Toxic Substances Control Act, or any state or local statute, regulation,
ordinance, order or decree relating to health, safety or the environment.

 

Environmental
Notice. Any notice to the Borrower or any of its Subsidiaries from any
third party including, without limitation: any federal, state or local
governmental authority, (a) that it has been identified by the United
States Environmental Protection Agency as a potentially responsible party under
CERCLA with respect to a site listed on the National Priorities List, 40 C.F.R.
Part 300 Appendix B; (b) that any Hazardous Substances which it has
generated, transported or disposed of has been found at any site at which a
federal, state or local agency or other third party has conducted or has
ordered that the Borrower or any of its Subsidiaries conduct a remedial
investigation, removal or other response action pursuant to any Environmental
Law; or (c) that it is or shall be a named party to any claim, action,
cause of action, complaint, or legal or administrative proceeding in connection
with the release of Hazardous Substances.

 

ERISA. The
Employee Retirement Income Security Act of 1974.

 

ERISA  Affiliate.
Any Person which is treated as a single employer with the Borrower under §414
of the Code.

 

ERISA  Reportable
Event. A reportable event with respect to a Guaranteed Pension Plan
within the meaning of §4043 of ERISA and the regulations promulgated thereunder
as to which the requirement of notice has not been waived.

 

Eurocurrency  Rate.
For any Interest Period with respect to a Eurocurrency Rate Loan, the rate per
annum determined on the basis of the rate for deposits in Dollars for a period
equal to such Interest Period commencing on the first day of such Interest
Period appearing on Reuters Page LIBOR01 at approximately 11:00 a.m.,
London time, two (2) Business Days prior to the commencement of such
Interest Period; provided that in the event that such rate does not
appear on such Reuters Page (or otherwise on the Reuters screen), the “Eurodollar
Rate” for purposes of this definition shall be determined by reference to
such other comparable publicly available service for displaying eurodollar
rates as may be reasonably selected by the Administrative Agent.

 

Eurocurrency  Rate
Loans. Any Loans bearing interest calculated by reference to the
Eurocurrency Rate.

 

Event  of
Default. See §12.1 hereof.

 

Federal  Funds
Effective  Rate. For any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers on such
day, as published for the Business Day next succeeding (or, if such day is not
a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any next succeeding
Business Day, the Federal Funds Effective Rate for any such day shall be the
average rate per annum (rounded upward, if necessary, to a whole multiple of
1/100 of 1%) of the quotations for the day of such transactions 

 

8

 

received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it.

 

Financial  Affiliate.
A Subsidiary of the bank holding company controlling any Lender, which
Subsidiary is engaging in any of the activities permitted by §4(e) of the Bank
Holding Company Act of 1956 (12 U.S.C. §1843).

 

Fixed  Charge
Coverage  Ratio. See §7.1 hereof.

 

Fund. Any
Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business.

 

GAAP  or
generally  accepted  accounting  principles. (a) When
used in §§6 and 7 hereof, whether directly or indirectly through reference to a
capitalized term used therein, means (i) principles that are consistent
with the principles promulgated or adopted by the Financial Accounting
Standards Board and its predecessors, in effect for the fiscal year ended on
the Balance Sheet Date, and (ii) to the extent consistent with such
principles, the accounting practice of the Borrower reflected in its financial
statements for the year ended on the Balance Sheet Date, and (b) when used
in general, other than as provided above, means principles that are (i) consistent
with the principles promulgated or adopted by the Financial Accounting
Standards Board and its predecessors, as in effect from time to time, and (ii) consistently
applied with past financial statements of the Borrower adopting the same
principles, provided that in each case referred to in this definition of
GAAP a certified public accountant would, insofar as the use of such accounting
principles is pertinent, be in a position to deliver an unqualified opinion
(other than a qualification regarding changes in GAAP) as to financial
statements in which such principles have been properly applied.

 

Governmental Authority. The government of the United States of America, or of any other
nation, or any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

 

Guaranteed  Pension
Plan. Any employee pension benefit plan within the meaning of §3(2) of
ERISA maintained or contributed to by the Borrower or any ERISA Affiliate the
benefits of which are guaranteed on termination in full or in part by the PBGC
pursuant to Title IV of ERISA, other than a Multiemployer Plan.

 

Guaranties. The Guaranty by each Guarantor in favor of
the Administrative Agent for the benefit of the Lenders and the Administrative
Agent, dated as of the date hereof, and each additional guaranty executed by a
Subsidiary of the Borrower acquired or formed after the date hereof.

 

Guarantors. Those
Subsidiaries of the Borrower listed on Schedule
2 hereto, as such schedule may be modified from time to time in accordance
with §3.14 hereof.

 

9

 

Hazardous  Substances.
Any hazardous waste, as defined by 42 U.S.C. §6903(5), any hazardous substances
as defined by 42 U.S.C. §9601(14), any pollutant or contaminant as defined by
42 U.S.C. §9601(33) and any toxic substances, oil or hazardous materials or
other chemicals or substances regulated by any Environmental Laws.

 

Indebtedness.
All obligations, contingent and otherwise, that in accordance with GAAP should
be classified upon the obligor’s balance sheet as liabilities, or to which
reference should be made by footnotes thereto, including in any event and
whether or not so classified: (a) all debt and similar monetary
obligations, whether direct or indirect; (b) all liabilities secured by
any mortgage, pledge, security interest, lien, charge or other encumbrance
existing on property owned or acquired subject thereto, whether or not the
liability secured thereby shall have been assumed; (c) all obligations in
respect of interest rate protection arrangements and exchange rate protection
arrangements; (d) all guarantees, endorsements and other contingent
obligations whether direct or indirect in respect of indebtedness of others,
including any obligation to supply funds to or in any manner to invest in,
directly or indirectly, the debtor, to purchase indebtedness, or to assure the
owner of indebtedness against loss, through an agreement to purchase goods,
supplies, or services for the purpose of enabling the debtor to make payment of
the indebtedness held by such owner or otherwise, and the obligations to
reimburse the issuer in respect of any letters of credit; and (e) every
obligation of such Person under any Synthetic Lease.

 

Indemnified  Party.
See §14.7 hereof.

 

Indemnitee. See
§16 hereof.

 

Initial  Lenders.
LCPI, Bank of America, N.A. and HSBC Bank USA, National Association.

 

Interest  Payment
Date. (a) As to any Base Rate Loan, each Quarterly Date; and (b) as
to any Eurocurrency Rate Loan in respect of which the Interest Period is (i) 3
months or less, the last day of such Interest Period and (ii) more than 3
months, the date that is 3 months from the first day of such Interest Period,
the last day of each 3 month period thereafter, and, in addition, the last day
of such Interest Period.

 

Interest  Period.
With respect to each Eurocurrency Rate Loan, (a) initially, the period
commencing on the Drawdown Date of such Loan and ending on the numerically
corresponding day in the calendar month that is 1, 2, 3 or 6 months thereafter,
as selected by the Borrower in a Loan Request; and (b) thereafter, each
period commencing on the last day of the next preceding Interest Period
applicable to such Loan and ending on the numerically corresponding day in the
calendar month that is 1, 2, 3 or 6 months thereafter, as selected by the
Borrower in a Conversion Request; provided that all of the foregoing
provisions relating to Interest Periods are subject to the following:

 

(a)                                 if
any Interest Period would otherwise end on a day that is not a Business Day,
that Interest Period shall be extended to the next succeeding Business Day 

 

10

 

unless the result of such extension would be
to carry such Interest Period into another calendar month, in which event such
Interest Period shall end on the immediately preceding Business Day;

 

(b)                                if
the Borrower shall fail to give notice as provided in §2.9 hereof, the Borrower
shall be deemed to have requested a conversion of the affected Eurocurrency
Rate Loan to a Base Rate Loan;

 

(c)                                 any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of a
calendar month; and

 

(d)                                any
Interest Period that would otherwise extend beyond the Maturity Date shall end
on the Maturity Date.

 

Investments. All
expenditures made and all liabilities incurred (contingently or otherwise) for
the acquisition of stock or Indebtedness of, or for loans, advances, capital
contributions or transfers of property to, or in respect of any guaranties (or
other commitments as described under Indebtedness), or obligations of, any
Person. In determining the aggregate amount of Investments outstanding at any
particular time: (a) the amount of any Investment represented by a
guaranty shall be taken at not less than the principal amount of the
obligations guaranteed and still outstanding; (b) there shall be included
as an Investment all interest accrued with respect to Indebtedness constituting
an Investment unless and until such interest is paid; (c) there shall be
deducted in respect of each such Investment any amount received as a return of
capital (but only by repurchase, redemption, retirement, repayment, liquidating
dividend or liquidating distribution); (d) there shall not be deducted in
respect of any Investment any amounts received as earnings on such Investment,
whether as dividends, interest or otherwise, except that accrued interest
included as provided in the foregoing clause (b) may be deducted when
paid; and (e) there shall not be deducted from the aggregate amount of
Investments any decrease in the value thereof.

 

Joinder  Agreements.
Joinder agreements in substantially the form of Exhibit E
hereto pursuant to which Subsidiaries of the Borrower become parties to and
agree to be bound by the provisions of the Guaranty as a Guarantor.

 

LCPI. Lehman
Commercial Paper Inc., in its individual capacity.

 

Lender  Affiliate.
With respect to any Lender, (a) an Affiliate of such Lender or (b) any
Approved Fund.

 

Lenders. As
defined in the preamble hereto, which term shall include any other Person who
becomes an assignee of any rights and obligations of a Lender pursuant to §18
hereof.

 

11

 

Lending  Office.
As to any Lender, the office or offices of such Lender described as such in
such Lender’s Administrative Questionnaire, or such other office or offices as
a Lender may from time to time notify the Borrower and the Administrative
Agent.

 

Loan  Documents.
This Credit Agreement, the Guaranties, the Notes and any other documents delivered pursuant to this Credit Agreement.

 

Loan  Request.
See §2.2 hereof.

 

Loans. Loans
made or to be made by the Lenders to the Borrower pursuant to §2 hereof.

 

Margin  Regulations.
Regulations U and X.

 

Margin  Stock.
“Margin stock” as such term is defined in Regulation U.

 

Material  Indebtedness.
Indebtedness (other than the Loans) or obligations in respect of one or more
interest rate protection arrangements or exchange rate protection arrangements
(calculated, with respect to such arrangements based on the notional principal
amount thereof) of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount of $50,000,000 or more.

 

Maturity  Date.
November 28, 2008.

 

Measurement  Period.
See §7.1 hereof.

 

Moody’s. Moody’s
Investors Service, Inc.

 

Multiemployer
Plan. Any multiemployer plan within the meaning of §3(37) of ERISA
maintained or contributed to by the Borrower or any ERISA Affiliate.

 

Non-U.S.  Lender.
See §3.3.3 hereof.

 

Notes. Notes
issued pursuant to §2.10 hereof.

 

Obligations. All
indebtedness, obligations and liabilities of any of the Borrower and its
Subsidiaries to any of the Lenders and the Administrative Agent, individually
or collectively, existing on the date of this Credit Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, arising or incurred under this
Credit Agreement or any of the other Loan Documents or in respect of any of the
Loans or other instruments at any time evidencing any thereof.

 

OECD. The Organization for Economic Cooperation
and Development.

 

Offer. Collectively,
(a) the tender offer in The Netherlands and all other jurisdictions (other
than the United States of America) by the Borrower or a wholly-owned Subsidiary
for all of the Corporate Express Dutch Shares and convertible debt of 

 

12

 

Corporate Express pursuant to
the applicable Offer Documents and (b) the concurrent tender offer in the
United States of America by the Borrower or a wholly-owned Subsidiary for all
of the Corporate Express ADS, wherever held, and Corporate Express Dutch Shares
held by persons located in the United States pursuant to the applicable Offer
Documents, in each case, as such offer may be modified, amended, supplemented,
withdrawn, reinstated or reaffirmed, launched or relaunched on or prior to the
Closing Date.

 

Offer  Documents.
(a) The Offer Memorandum, (b) each other document filed (whether
prior to or following the Effective Date) by or on behalf of the Borrower or
any of its Subsidiaries with the AFM, the SEC or any other applicable
Governmental Authority in connection with the Offer, which in each case shall
contain customary offer terms and conditions, and (c) any amendments,
supplements or other modifications to any of the foregoing.

 

Offer  Memorandum.
(a) The offer memorandum (biedingsbericht)
filed (or to be filed) by the Borrower with, and approved (or to be approved)
by, the AFM and (ii) the tender offer document filed with or submitted to
the SEC, with respect to the Borrower’s offer to purchase all of the Corporate
Express Shares (and, if applicable, the convertible debt of Corporate Express),
in each case, which shall contain customary offer terms and conditions.

 

Outstanding or  outstanding.
With respect to the Loans, the aggregate unpaid principal thereof as of any
date of determination.

 

Overnight  Rate.
For any day, the greater of (a) the Federal Funds Effective Rate and (b) an
overnight rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation.

 

Participant. See
§18.4 hereof.

 

PBGC. The
Pension Benefit Guaranty Corporation created by §4002 of ERISA and any
successor entity or entities having similar responsibilities.

 

Permitted  Liens.
Liens, security interests and other encumbrances permitted under §6.2 hereof.

 

Person. Any
individual, corporation, limited liability company, partnership, limited
liability partnership, trust, unincorporated association, business, or other
legal entity, and any government or any governmental agency or political
subdivision thereof.

 

Platform. See
§5.4(e) hereof.

 

Prime Rate.
The prime lending rate as set forth on the Reuters Screen RTRTSY1 Page (or
such other comparable page as may, in the reasonable opinion of the
Administrative Agent, replace such page for the purpose of displaying such
rate), as in effect from time to time.

 

13

 

Public  Lender.
See §4.15 hereof.

 

Quarterly Dates.
The last Business Day of March, June, September and December in each
year, the first of which shall be the first such day after the date hereof.

 

Rate  Adjustment
Period. As defined in the definition of Applicable Margin.

 

Real
Estate. All real property at any time owned or leased (as lessee or
sublessee) by the Borrower or
any of its Subsidiaries.

 

Register. See
§18.3 hereof.

 

Regulation  U.
Regulation U of the Board of Governors of the Federal Reserve System (or any
governmental body or authority succeeding to its functions), 12 C.F.R. Part 221,
as in effect from time to time.

 

Regulation  X.
Regulation X of the Board of Governors of the Federal Reserve System (or any
governmental body or authority succeeding to its functions), 12 C.F.R. Part 224,
as in effect from time to time.

 

Related  Parties.
With respect to any Person, such Person’s Affiliates and the officers,
directors, partners, trustees, employees, shareholders, advisors, agents,
attorneys and controlling persons of such Person and of such Person’s
Affiliates and their respective heirs, successors and assigns.

 

Rental  Expense. All obligations of the Borrower or
any of its Subsidiaries under any rental agreements or leases of real property
relating to retail stores, other than obligations in respect of Capitalized
Leases and Synthetic Leases; provided that, with respect to any Measurement
Period in which the Corporate Express Acquisition shall have been consummated,
Rental Expense for such period shall be calculated on a pro forma
basis so as to give effect thereto as of the first day of such period.

 

Replacement  Lender.
See §3.12 hereof.

 

Required  Lenders.
As of any date, the Lenders holding more than fifty percent (50%) of the sum of
the outstanding principal amount of the Loans on such date (excluding any
participations of a Delinquent Lender); and if no such principal and/or
participation is outstanding, the Lenders whose aggregate Commitment Amounts
constitute more than fifty percent (50%) of the Total Commitment.

 

Revolving  Credit
Agreement. That certain Amended and Restated Revolving Credit Agreement
dated as of October 13, 2006, as amended, by and among the Borrower, the
lending institutions party thereto and Bank of America as administrative agent
for such lending institutions.

 

Same  Day
Funds. With respect to disbursements and payments in Dollars,
immediately available funds.

 

14

 

S&P. Standard &
Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

 

SEC.
The United States Securities and Exchange Commission or any successor agency.

 

Senior  Debt
Rating. The rating issued by S&P or Moody’s with respect to
unsecured Indebtedness of the Borrower not maturing within twelve months, issued
without third-party credit enhancement, and not subordinated by its term in
right of payment to other Indebtedness of the Borrower. In the event that no
such ratings are available on such unsecured Indebtedness of the Borrower, the
Senior Debt Rating shall be the rating implied, in the reasonable discretion of
the Administrative Agent, to such unsecured Indebtedness by reference to such
other Indebtedness of the Borrower as shall be so rated.

 

SFAS 123R. Financial
Accounting Standards Board Statement No. 123 (revised 2004), Share Based Payment, as amended or revised from time to
time.

 

Specified Representations. Each of (a) the representations and warranties of the Borrower
set forth in §§4.1, 4.11 and 4.13 hereof and (b) the representations and
warranties of the Borrower and/or any of its Subsidiaries set forth in any
Offer Document.

 

Stockholders’
Equity. As at any date of determination, the sum of (a) the capital
accounts including common stock and preferred stock, but excluding treasury
stock of the Borrower plus (b) the earned surplus and capital
surplus of the Borrower (excluding adjustments to translate foreign assets and
liabilities for changes in foreign exchange rates made in accordance with
Financial Accounting Standards Board Statement No. 52), as determined in
accordance with GAAP.

 

Subordinated  Debt.
Unsecured Indebtedness of the Borrower or any of its Subsidiaries that is
expressly subordinated and made junior to the payment and performance of the
Obligations, and evidenced as such by a written instrument containing
subordination provisions in form and substance approved by the Required Lenders
in writing.

 

Subsidiary. Any
corporation, association, trust, or other business entity of which the
designated parent shall at any time own directly or indirectly through a
Subsidiary or Subsidiaries at least a majority (by number of votes) of the
outstanding Voting Stock and the accounts of which are consolidated with such
designated parent in accordance with GAAP. Unless otherwise specified, “Subsidiary”
means a Subsidiary of the Borrower.

 

Substituted  Lender.
See §3.12 hereof.

 

Synthetic  Lease.
Any lease of goods or other property, whether real or personal, which is
treated as an operating lease under GAAP and as a loan or financing for U.S.
income tax purposes.

 

15

 

Total  Commitment.
The sum of the Commitment Amounts of the Lenders, as in effect from time to
time. The Total Commitment as of the Closing Date is $400,000,000.

 

Transactions.
Collectively, the transactions contemplated in the Offer Documents and the Loan
Documents, the financing of the Corporate Express Acquisition including the
financing contemplated by this Credit Agreement, and the repayment of any
Indebtedness of Corporate Express and its Subsidiaries contemplated to be
refinanced in connection with (or as a result of) the Corporate Express
Acquisition.

 

Type. As to
any Loan, its nature as a Base Rate Loan or a Eurocurrency Rate Loan.

 

USA Patriot Act.
The USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)), as amended from time to time.

 

Voting  Stock.
Capital Stock of any class or classes (however designated), the holders of
which are at the time entitled, as such holders, to vote for the election of a
majority of the directors (or persons performing similar functions) of the
corporation, association, trust or other business entity involved, whether or
not the right so to vote exists by reason of the happening of a contingency.

 

§1.2.                    Rules of
Interpretation

 

(a)                                 A
reference to any document or agreement shall include such document or agreement
as amended, modified or supplemented from time to time in accordance with its
terms and the terms of this Credit Agreement.

 

(b)                                The
singular includes the plural and the plural includes the singular.

 

(c)                                 A
reference to any law includes any amendment or modification to such law.

 

(d)                                A
reference to any Person includes its permitted successors and permitted
assigns.

 

(e)                                 Accounting
terms not otherwise defined herein have the meanings assigned to them by
generally accepted accounting principles applied on a consistent basis by the
accounting entity to which they refer.

 

(f)                                   The
words “include”, “includes” and “including” are
not limiting.

 

(g)                                All
terms not specifically defined herein or by GAAP, which terms are defined in
the Uniform Commercial Code as in effect in the Commonwealth of Massachusetts,
have the meanings assigned to them therein, with the term “instrument” being
that defined under Article 9 of the Uniform Commercial Code.

 

16

 

(h)                                Reference
to a particular “§” refers to that section of this Credit Agreement unless
otherwise indicated.

 

(i)                                    The
words “herein”, “hereof”, “hereunder” and words
of like import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.

 

(j)                                    Unless
otherwise expressly indicated, in the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including,” the words “to” and “until” each mean “to but excluding,” and the
word “through” means “to and including.”

 

(k)                                 This
Credit Agreement and the other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are, however, additive and are to be
performed in accordance with the terms thereof.

 

(l)                                    This
Credit Agreement and the other Loan Documents are the result of negotiation
among, and have been reviewed by counsel to, among others, the Administrative
Agent and the Borrower and are the product of discussions and negotiations
among all parties. Accordingly, this Credit Agreement and the other Loan
Documents are not intended to be construed against the Administrative Agent or
any of the Lenders merely on account of the Administrative Agent’s or any
Lender’s involvement in the preparation of such documents.

 

§2.                               THE
CREDIT FACILITY.

 

§2.1.                    Commitment to Lend Loans. Subject to the terms and conditions set
forth in this Credit Agreement, each of the Lenders severally agrees to make
Loans to the Borrower on the Closing Date (or as otherwise contemplated by the
last sentence of §9.2 hereof) in Dollars and in such amounts as are requested by
the Borrower, provided that (i) the principal amount of the Loan
made by each Lender shall not at any time exceed such Lender’s Commitment
Amount and (ii) (after giving effect to all amounts requested) the
outstanding Loans shall not exceed the Total Commitment. Any portion of the
Commitment Amounts not drawn on the Closing Date will terminate automatically. Notwithstanding
anything herein to the contrary, only one drawdown of Loans shall be permitted
under this Credit Agreement (subject to the last sentence of §9.2 hereof).

 

§2.2.                    Requests for Loans. The Borrower shall give to the
Administrative Agent written notice in the form of Exhibit A hereto
(or telephonic notice confirmed in a writing in the form of Exhibit A
hereto) of each Loan requested hereunder (a “Loan  Request”) not
later than (a) 12:00 noon (New York time) on the proposed Drawdown Date of
any Base Rate Loan and (b) 12:00 noon (New York time) three (3) Business
Days prior to the proposed Drawdown Date of any Eurocurrency Rate Loan. Each
such notice shall specify (i) the principal amount of the Loan requested, (ii) the
proposed Drawdown Date of such Loan, (iii) with respect to any
Eurocurrency Rate Loan, the 

 

17

 

initial
Interest Period relating thereto and (iv) the Type of such Loan. Promptly
upon receipt of any such notice, the Administrative Agent shall notify each of
the Lenders thereof. Each Loan Request shall be irrevocable and binding on the
Borrower and shall obligate the Borrower to accept the Loan requested from the
Lenders on the proposed Drawdown Date. Each Loan Request shall be (A) in a
minimum aggregate amount of $1,000,000 or an integral multiple thereof with
respect to Base Rate Loans and (B) in a minimum aggregate amount of
$5,000,000 or an integral multiple of $l,000,000 with respect to Eurocurrency
Rate Loans.

 

§2.3.                    Funds
for Loans.

 

§2.3.1.          Funding Procedures. Each of the relevant Lenders will make
available to the Administrative Agent, to the account of the Administrative
Agent most recently designated by it for such purpose to the Lenders, in Same
Day Funds, the amount of such Lender’s Commitment Percentage of the amount of
the requested Loans not later than 1:30 p.m. (New York time) on the
proposed Drawdown Date of any Loans. Upon receipt from each Lender of such
amount, and upon receipt of the documents required by §9 hereof and the
satisfaction of the other conditions set forth therein, to the extent
applicable, the Administrative Agent will make available to the Borrower the aggregate
amount of such Loans made available to the Administrative Agent by the relevant
Lenders. The failure or refusal of any Lender to make available to the
Administrative Agent its Commitment Percentage of the requested Loans on any
Drawdown Date shall not excuse any other Lender from making available to the
Administrative Agent the amount of such other Lender’s Commitment Percentage of
any requested Loans.

 

§2.3.2.          Advances by Administrative
Agent.

 

(a)                                 The Administrative Agent may, unless notified
to the contrary by any Lender prior to a Drawdown Date, assume that such Lender
has made available to the Administrative Agent on such Drawdown Date the amount
of such Lender’s Commitment Percentage of the Loans to be made on such Drawdown
Date, and the Administrative Agent may (but it shall not be required to), in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If any Lender makes available to the Administrative Agent such amount
on a date after such Drawdown Date, such Lender shall pay to the Administrative
Agent on demand an amount equal to the product of (a) the average computed
for the period referred to in clause (c) below, of the Overnight Rate for
each day included in such period, times (b) the amount of such Lender’s
Commitment Percentage of such Loans, times (c) a fraction, the numerator
of which is the number of days that elapse from and including such Drawdown
Date to the date on which the amount of such Lender’s Loans shall become
immediately available to the Administrative Agent, and the denominator of which
is 360. A statement of the Administrative Agent submitted to such Lender with
respect to any amounts owing under this §2.3.2 shall be prima facie evidence of
the amount due and owing to the Administrative Agent by such Lender. If the
amount of such Lender’s Loans is not made available to the Administrative Agent
by such Lender within three (3) Business Days 

 

18

 

following such Drawdown
Date, the Administrative Agent shall be entitled to recover such amount from
the Borrower on demand, with interest thereon at the rate per annum applicable
to the Loans made on such Drawdown Date and the Borrower may take the actions
permitted under §3.12 hereof to replace such Lender. Any payment by the
Borrower to the Administrative Agent of any Loans pursuant to this §2.3.2 shall
be deemed to be a payment of the Loans that were to be made by the Lender that
failed to make such Loans.

 

(b)                                Unless the Borrower has notified the Administrative
Agent prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower will not make such payment,
the Administrative Agent may assume that the Borrower has timely made such
payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to such Lender. If and to the extent that such
payment was not in fact made to the Administrative Agent by the Borrower in
Same Day Funds, then each Lender shall forthwith on demand repay to the
Administrative Agent the portion of such assumed payment that was made
available to such Lender in Same Day Funds, together with interest thereon in
respect of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is repaid to
the Administrative Agent in Same Day Funds at the Overnight Rate from time to
time in effect.

 

(c)                                 A notice of the Administrative Agent to any
Lender or the Borrower with respect to any amount owing under §§2.3.2(a) and
(b) hereof shall be conclusive, absent manifest error.

 

§2.4.                    Reduction of Total
Commitment. The Borrower
shall have the right at any time and from time to time prior to the Maturity
Date upon three (3) Business Days’ prior written notice to the
Administrative Agent to reduce by $5,000,000 or an integral multiple thereof or
terminate entirely the Total Commitment, whereupon the Commitment Amount of
each Lender shall be reduced pro rata in
accordance with its Commitment Percentage by the amount specified in such
notice or, as the case may be, terminated. Promptly after receiving any notice
of the Borrower delivered pursuant to this §2.4, the Administrative Agent will
notify the Lenders of the substance thereof. No reduction or termination of the
Total Commitment may be reinstated.

 

Unless previously terminated, the Total Commitment shall terminate
entirely and automatically at 5:00 p.m., New York City time, on the
earlier of (a) the Closing Date and (b) July 11, 2008 (if the
Closing Date shall not have occurred on or prior to such date).

 

§2.5.                    Maturity of Loans. The Borrower promises to pay on the
Maturity Date, and there shall become absolutely due and payable on the
Maturity Date, all of the Loans outstanding to the Borrower on such date,
together with any and all accrued and unpaid interest thereon.

 

§2.6.                    [Reserved].

 

19

 

§2.7.                    Optional Repayments of Loans. The Borrower shall have the right, at its
election, to repay the outstanding amount of the Loans, as a whole or in part,
at any time without penalty or premium, provided that any full or
partial repayment of the outstanding amount of any Eurocurrency Rate Loans
pursuant to this §2.7 may be made only on the last day of the Interest Period
relating thereto unless the Borrower pays each Lender, in accordance with §3.10
hereof, the costs and expenses incurred by such Lender as a result of the
repayment of such Eurocurrency Rate Loan on a day other than the last day of the
Interest Period relating thereto. The Borrower shall give the Administrative
Agent, prior written notice no later than 1:00 p.m., (New York time), on
the date of any proposed repayment pursuant to this §2.7 of Base Rate Loans and
no later than 1:00 p.m., (New York time), three (3) Business Days’
prior to any proposed repayment pursuant to this §2.7 of Eurocurrency Rate
Loans, in each case specifying the proposed date of repayment of such Loans and
the principal amount to be prepaid. Each such partial repayment of the Loans
shall be in an integral multiple of $5,000,000 and shall be applied, in the
absence of instruction by the Borrower, first to the principal of Base Rate
Loans and then to the principal of Eurocurrency Rate Loans. Each partial
repayment of Loans shall be allocated ratably among the Lenders in proportion
to the respective unpaid principal amount of the Loans made by each Lender
being prepaid. Loans, once prepaid, may not be reborrowed.

 

§2.8.                    Interest on Loans. (a)  Except as otherwise provided in
§3.11 hereof,

 

(i)                                     each Base Rate
Loan shall bear interest for the period commencing with the Drawdown Date
thereof and to but excluding the date of payment thereof at the rate per annum
equal to the Base Rate plus the Applicable Margin (subject to adjustment from
time to time as provided in the last paragraph of the definition of “Applicable
Margin”); and

 

(ii)                                  each Eurocurrency
Rate Loan shall bear interest for the period commencing with the Drawdown Date
thereof and to but excluding the last day of the Interest Period with respect
thereto at the rate per annum equal to the Eurocurrency Rate determined for
such Interest Period plus the Applicable Margin (subject to adjustment from
time to time as provided in the last paragraph of the definition of “Applicable
Margin”).

 

(b)                                Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and upon termination of the Total Commitment; provided
that, in the event of any repayment or prepayment of any Loan (other than a
repayment or prepayment of a Base Rate Loan prior to the Maturity Date),
accrued interest on the principal amount repaid or prepaid shall be payable on
the date of such repayment or prepayment.

 

§2.9.                    Conversion
Options.

 

§2.9.1.          Conversion to Different Type of
Loan. The Borrower may
elect from time to time to convert any outstanding Loan to a Loan of another
Type, 

 

20

 

provided that (a) with respect to any such
conversion of a Eurocurrency Rate Loan to a Base Rate Loan, the Borrower shall
give the Administrative Agent at least one (1) Business Day’s prior
written notice of such election; (b) with respect to any such conversion
of a Base Rate Loan to a Eurocurrency Rate Loan, the Borrower shall give the Administrative
Agent at least three (3) Business Days’ prior written notice of such
election; (c) with respect to any such conversion of a Eurocurrency Rate
Loan into a Base Rate Loan, such conversion shall only be made on the last day
of the Interest Period with respect to such Eurocurrency Rate Loan; and (d) no
Base Rate Loan may be converted into a Eurocurrency Rate Loan when any Default
or Event of Default has occurred and is continuing. On the date on which such
conversion is being made each Lender shall take such action as is necessary to
transfer its Commitment Percentage of such Loans to its Lending Office for
domestic loans or its Lending Office for Eurocurrency Rate Loans, as the case
may be. All or any part of outstanding Loans of any Type may be converted into
a Loan of another Type as provided herein, provided that any partial
conversion shall be in an aggregate principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof. Each Conversion Request relating to
the conversion of a Loan to a Eurocurrency Rate Loan shall be irrevocable by
the Borrower.

 

§2.9.2.          Continuation of Type of Loan. Any Eurocurrency Rate Loan may be continued
as a Eurocurrency Rate Loan upon the expiration of an Interest Period with
respect thereto by compliance by the Borrower with the notice provisions
contained in §2.9.1 hereof; provided that no Eurocurrency Rate Loan may
be continued as such when any Default or Event of Default has occurred and is
continuing, but shall be automatically converted to a Base Rate Loan on the
last day of the first Interest Period relating thereto ending during the
continuance of any Default or Event of Default of which officers of the
Administrative Agent active upon the Borrower’s account have actual knowledge. In
the event that the Borrower fails to provide any such notice with respect to
continuation of a Eurocurrency Rate Loan as such, than such Eurocurrency Rate
shall be automatically converted to a Base Rate Loan on the last day of the
Interest Period relating thereto. The Administrative Agent shall notify the
Lenders and the Borrower promptly when any such automatic conversion
contemplated by this §2.9.2 is scheduled to occur.

 

§2.9.3.          Eurocurrency Rate Loans. Any conversion to or from Eurocurrency Rate
Loans shall be in such amounts and be made pursuant to such elections so that,
after giving effect thereto, the aggregate principal amount of all Eurocurrency
Rate Loans having the same Interest Period shall not be less than 5,000,000 or
a whole multiple of $1,000,000 in excess thereof. No more than six (6) Eurocurrency
Rate Loans having different Interest Periods may be outstanding at any time.

 

§2.10.             Evidence of Debt. The Loans made by each Lender shall be
evidenced by one or more accounts or records maintained by such Lender and by
the Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Lender shall be
conclusive absent manifest error of the amount of the Loans made to the
Borrower and the interest and payments thereon. Any failure to so record or any
error in doing so shall not, however, limit or otherwise affect 

 

21

 

the
obligation of the Borrower hereunder to pay any amount owing with respect to
the Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the
Administrative Agent shall control in the absence of manifest error. Upon the
request of any Lender made through the Administrative Agent, the Borrower shall
execute and deliver to such Lender (through the Administrative Agent) a Note (a
“Note”), which shall evidence such Lender’s Loans in addition to such
accounts or records. Each Lender may attach schedules to its Note and endorse
thereon the date, Type (if applicable), amount and maturity of its Loans and
payments with respect thereto.

 

§3.                               CERTAIN
GENERAL PROVISIONS; FEES.

 

§3.1.                    Administrative Agent Fees. The Borrower shall pay the fees (the “Administrative
Agent  Fees”) to the Administrative Agent for its own account in
the amount and at the times separately agreed upon in writing between the
Borrower and the Administrative Agent.

 

§3.2.                    Duration
Fees. The Borrower shall pay to each Lender a duration fee equal to
0.25% of the principal amount of each Lender’s Loans outstanding on the date 90
days after the Closing Date, which fee
will be paid to the Lenders on such 90th day (or if such day is not a
Business Day, on the next succeeding Business Day)

 

§3.3.                    Funds
for Payments.

 

§3.3.1.          Payments to Administrative Agent. All payments of principal, interest,
Commitment Fees and any other fees or amounts due hereunder or under any of the
other Loan Documents shall be made in Dollars to the Administrative Agent, for
the respective accounts of the Lenders and the Administrative Agent, not later
than 2:00 p.m. (New York time), to the account of the Administrative Agent
most recently designated by it for such purpose to the Lenders, in each case in
Same Day Funds.

 

§3.3.2.          No Offset, Etc. All payments by the Borrower hereunder and
under any of the other Loan Documents shall be made without condition or
deduction for any recoupment, defense, setoff or counterclaim and free and
clear of and without deduction for any taxes, levies, imposts, duties, charges,
fees, deductions, withholdings, compulsory loans, restrictions or conditions of
any nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein unless the
Borrower is compelled by law to make such deduction or withholding. If any such
obligation is imposed upon the Borrower with respect to any amount payable by
it hereunder or under any of the other Loan Documents, other than (a) with
respect to taxes based upon the Administrative Agent’s or any Lender’s net
income, or (b) with respect to amounts owing to a Lender that (i) is
not incorporated under the laws of the United States of America or a state
thereof and (ii) has not delivered to the Administrative Agent the forms
referred to in §3.3.3 hereof, the Borrower will pay to the Administrative
Agent, for the account of the Lenders or (as the case may be) the 

 

22

 

Administrative
Agent, on the date on which such amount is due and payable hereunder or under
such other Loan Document, such additional amount as shall be necessary to
enable the Lenders or the Administrative Agent to receive the same net amount
which the Lenders or the Administrative Agent would have received on such due
date had no such obligation been imposed upon the Borrower. The Borrower will
deliver promptly to the Administrative Agent certificates or other valid vouchers
for all taxes or other charges deducted from or paid with respect to payments
made by the Borrower hereunder or under such other Loan Document.

 

§3.3.3.          Withholding. Each Lender and the Administrative Agent that
is not a U.S. Person as defined in Section 7701(a)(30) of the Code for
federal income tax purposes (a “Non-U.S.  Lender”) hereby agrees
that, if and to the extent it is legally able to do so, it shall, on the date
it becomes a Lender hereunder, deliver to the Borrower and the Administrative
Agent such certificates, documents or other evidence, as and when required by
the Code or Treasury Regulations issued pursuant thereto, including (a) in
the case of a Non-U.S. Lender that is a “bank” for purposes of Section 881(c)(3)(A) of
the Code, two (2) duly completed copies of Internal Revenue Service Form W-8BEN
or Form W-8ECI and any other certificate or statement of exemption
required by Treasury Regulations, or any subsequent versions thereof or
successors thereto, properly completed and duly executed by such Lender or the
Administrative Agent establishing that with respect to payments of principal,
interest or fees hereunder it is (i) not subject to United States federal
withholding tax under the Code because such payment is effectively connected
with the conduct by such Lender or Administrative Agent of a trade or business
in the United States or (ii) totally exempt from United States federal
withholding tax under a provision of an applicable tax treaty and (b) in
the case of a Non-U.S. Lender that is not a “bank” for purposes of Section 881(c)(3)(A) of
the Code, a certificate in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower and to the effect that (i) such
Non-U.S. Lender is not a “bank” for purposes of Section 881(c)(3)(A) of
the Code, is not subject to regulatory or other legal requirements as a bank in
any jurisdiction, and has not been treated as a bank for purposes of any tax,
securities law or other filing or submission made to any Governmental
Authority, any application made to a rating agency or qualification for any
exemption from any tax, securities law or other legal requirements, (ii) is
not a ten percent (10%) shareholder for purposes of Section 881(c)(3)(B) of
the Code and (iii) is not a controlled foreign corporation receiving
interest from a related person for purposes of Section 881(c)(3)(C) of
the Code, together with a properly completed Internal Revenue Service Form W-8
or W-9, as applicable (or successor forms). Each Lender or the Administrative Agent
agrees that it shall, promptly upon a change of its lending office or the
selection of any additional lending office, to the extent the forms previously
delivered by it pursuant to this §3.3.3 are no longer effective, and promptly
upon the Borrower’s or the Administrative Agent’s reasonable request after the
occurrence of any other event (including the passage of time) requiring the
delivery of a Form W-8BEN, Form W-8ECI, Form W-8 or W-9 in
addition to or in replacement of the forms previously delivered, deliver to the
Borrower and the Administrative Agent, as applicable, if and to the extent it
is properly entitled to do so, a properly completed and executed Form W-8BEN,
Form W-8ECI, Form W-8 or W-9, as applicable (or any successor forms
thereto).

 

23

 

Each
Lender shall promptly (A) notify the Administrative Agent of any change in
circumstances which would modify or render invalid any such claimed exemption
or reduction, and (B) take such reasonable steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender,
and as may be reasonably necessary to avoid any requirement of applicable laws
of any such jurisdiction that the Borrower make any deduction or withholding
for taxes from amounts payable to such Lender. Additionally, the Borrower shall
promptly deliver to the Administrative Agent or any Lender, as the
Administrative Agent or such Lender shall reasonably request, on or prior to
the Effective Date, and in a timely fashion thereafter, such documents and
forms required by any relevant taxing authorities under the laws of any
jurisdiction, duly executed and completed by the Borrower, as are required to
be furnished by such Lender or the Administrative Agent under such laws in
connection with any payment by the Administrative Agent or any Lender of taxes
or otherwise in connection with the Loan Documents, with respect to such
jurisdiction. This §3.3.3 shall not be construed to require the Administrative
Agent, any Lender to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower or any other
Person.

 

§3.4.                    Computations. All computations of interest for Base Rate
Loans when the Base Rate is determined by the Prime Rate shall be made on the
basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.
All other computations of fees and interest shall be based on a 360-day year,
and, in each case, paid for the actual number of days elapsed. Except as
otherwise provided in the definition of the term “Interest  Period”,
whenever a payment hereunder or under any of the other Loan Documents becomes
due on a day that is not a Business Day, the due date for such payment shall be
extended to the next succeeding Business Day, and interest shall accrue during
such extension.

 

§3.5.                    Inability to Determine
Eurocurrency Rate. In
the event, prior to the commencement of any Interest Period relating to any
Eurocurrency Rate Loan, the Administrative Agent shall determine or be notified
by the Required Lenders that adequate and reasonable methods do not exist for
ascertaining the Eurocurrency Rate that would otherwise determine the rate of
interest to be applicable to any Eurocurrency Rate Loan during any Interest
Period, the Administrative Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrower and the
Lenders) to the Borrower and the Lenders. In such event (a) any Loan
Request or Conversion Request with respect to Eurocurrency Rate Loans shall be
automatically withdrawn and shall be deemed a request for Base Rate Loans, (b) each
Eurocurrency Loan, will automatically, on the last day of the then current
Interest Period relating thereto, become a Base Rate Loan, and (c) the
obligations of the Lenders to make Eurocurrency Rate Loans shall be suspended
until the Administrative Agent or the Required Lenders, as applicable,
determine that the circumstances giving rise to such suspension no longer
exist, whereupon the Administrative Agent or, as the case may be, the
Administrative Agent upon the instruction of the Required Lenders, shall so
notify the Borrower and the Lenders.

 

24

 

§3.6.                    Illegality. 
Notwithstanding any other provisions herein, if any present or future
law, regulation, treaty or directive or in the interpretation or application
thereof shall make it unlawful for any Lender to make or maintain Eurocurrency
Rate Loans, such Lender shall forthwith give notice of such circumstances to
the Borrower and the other Lenders and thereupon the commitment of such Lender
to make Eurocurrency Rate Loans or convert Base Rate Loans to Eurocurrency Rate
Loans shall forthwith be suspended and such Lender’s Loans then outstanding as
Eurocurrency Rate Loans, if any, shall be automatically, on the last day of the
then current Interest Period relating thereto or within such earlier period as
may be required by law, converted to a Base Rate Loan.  The Borrower hereby agrees promptly to pay
the Administrative Agent for the account of such Lender, upon demand by such
Lender, any additional amounts necessary to compensate such Lender for any
costs incurred by such Lender in making any conversion in accordance with this
§3.6, including any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its Eurocurrency Rate Loans
hereunder.

 

§3.7.                    Additional Costs, Etc.  If
any change after the Effective Date to any present applicable law or if any
future applicable law, which expression, as used herein, includes statutes, rules and
regulations thereunder and interpretations thereof by any competent court or by
any governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Lender or the Administrative Agent by any central
bank or other fiscal, monetary or other authority (whether or not having the
force of law), shall:

 

(a)                                 subject any Lender or
the Administrative Agent to any tax, levy, impost, duty, charge, fee, deduction
or withholding of any nature with respect to this Credit Agreement, the other
Loan Documents, such Lender’s Commitment or the Loans (other than taxes based
upon or measured by the income or profits of such Lender or the Administrative
Agent), or

 

(b)                                materially change the
basis of taxation (except for changes in taxes on income or profits) of
payments to any Lender of the principal of or the interest on any Loans or any
other amounts payable to any Lender or the Administrative Agent under this
Credit Agreement or any of the other Loan Documents, or

 

(c)                                 impose
or increase or render applicable (other than to the extent specifically
provided for elsewhere in this Credit Agreement) any special deposit, reserve,
assessment, liquidity, capital adequacy or other similar requirements (whether
or not having the force of law) against assets held by, or deposits in or for
the account of, or loans by, or commitments of an office of any Lender, or

 

(d)                                impose on any Lender or
the Administrative Agent any other conditions or requirements with respect to
this Credit Agreement, the other Loan Documents, the Loans, such Lender’s
Commitment, or any class of loans or commitments of which any of the Loans or
such Lender’s Commitment forms a part,

 

25

 

and
the result of any of the foregoing is:

 

(i)                                    to increase the
cost to any Lender, of making, funding or maintaining any of the Loans or such
Lender’s Commitment, or

 

(ii)                                 to reduce the amount
of principal, interest, or other amount payable to such Lender or the
Administrative Agent hereunder on account of such Lender’s Commitment or any of
the Loans, or

 

(iii)                              to require such Lender or
the Administrative Agent to make any payment or to forego any interest or other
sum payable hereunder, the amount of which payment or foregone interest or
other sum is calculated by reference to the gross amount of any sum receivable
or deemed received by such Lender or the Administrative Agent from the Borrower
hereunder,

 

then, in each such case and to the extent that the amount of such
additional cost, reduction, payment, foregone interest or other sum is not
reflected in the Base Rate or the Eurocurrency Rate, the Borrower will, upon
demand made by such Lender or (as the case may be) the Administrative Agent at
any time and from time to time and as often as the occasion therefor may arise,
pay to such Lender or the Administrative Agent such additional amounts as will
be sufficient to compensate such Lender or the Administrative Agent for such
additional cost, reduction, payment or foregone interest or other sum (without
duplication for recovery of such amounts under any other provision hereof), provided
that the Borrower shall not be liable to any Lender or the Administrative Agent
for costs incurred more than sixty (60) days prior to receipt by the Borrower
of such demand for payment from such Lender or (as the case may be) the
Administrative Agent unless such costs were incurred prior to such 60-day
period solely as a result of such present or future applicable law being
retroactive to a date which occurred prior to such 60-day period.

 

§3.8.                    Capital Adequacy.  If
after the Effective Date any Lender or the Administrative Agent determines that
the adoption of or change in any law, governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law) regarding
capital requirements for banks or bank holding companies or any change in the
interpretation or application thereof by a Governmental Authority with
appropriate jurisdiction has the effect of reducing the return on such Lender’s
or the Administrative Agent’s commitment with respect to any Loans to a level
below that which such Lender or the Administrative Agent could have achieved
but for such adoption, change or compliance (taking into consideration such
Lender’s or the Administrative Agent’s then existing policies with respect to
capital adequacy and assuming full utilization of such entity’s capital) by any
amount deemed by such Lender or (as the case may be) the Administrative Agent
to be material, then such Lender or the Administrative Agent may notify the
Borrower of such fact.  To the extent
that the amount of such reduction in the return on capital is not reflected in
the Base Rate or the Eurocurrency Rate, then the Borrower agrees to pay such
Lender or (as the case may be) the Administrative Agent for the amount of such
reduction in the return on capital as and when such reduction is 

 

26

 

determined upon presentation
by such Lender or (as the case may be) the Administrative Agent of a
certificate in accordance with §3.9 hereof, provided that the Borrower
shall not be liable to any Lender or the Administrative Agent for costs
incurred more than sixty (60) days prior to receipt by the Borrower of the
notice referred to in the immediately preceding sentence from such Lender or
(as the case may be) the Administrative Agent. 
Each Lender shall allocate such cost increases among its customers in
good faith and on an equitable basis.

 

§3.9.                    Certificate.  A
certificate setting forth any additional amounts payable pursuant to §§3.7 or
3.8 hereof and a brief explanation of such amounts which are due, submitted by
any Lender or the Administrative Agent to the Borrower, shall be conclusive,
absent manifest error, that such amounts are due and owing.  If the Borrower is required to pay any
additional amounts pursuant to §§3.7 or 3.8 hereof with respect to any Lender,
the Borrower may, following payment in full of the amount or amounts due set forth
in such certificate, take the actions permitted by §3.12 hereof to replace such
Lender.

 

§3.10.             Indemnity.  The
Borrower agrees to indemnify each Lender and to hold each Lender harmless from
and against all redeployment costs or expenses that such Lender may reasonably
sustain or incur as a consequence of (a) default by the Borrower in
payment of the principal amount of or any interest on any Eurocurrency Rate
Loan as and when due and payable, including any such cost or expense arising
from interest or fees payable by such Lender to lenders of funds obtained by it
in order to maintain its Eurocurrency Rate Loans, (b) default by the
Borrower in making a borrowing or conversion after the Borrower has given (or
is deemed to have given) a Loan Request or a Conversion Request relating
thereto in accordance with §§2.2 or 2.9 hereof or (c) the making of any
payment of a Eurocurrency Rate Loan or the making of any conversion of any
Eurocurrency Rate Loan to a Base Rate Loan on a day that is not the last day of
the applicable Interest Period with respect thereto, including interest or fees
payable by such Lender to lenders of funds obtained by it in order to maintain
any such Loans.

 

§3.11.             Interest After Default. 
Overdue principal and
(to the extent permitted by applicable law) interest on the Loans and all other
overdue amounts payable hereunder or under any of the other Loan Documents, if
not repaid on or before the fifth calendar day following the day such payment
was due, shall bear interest from the due date thereof, compounded monthly and
payable on demand at any time from and after the fifth calendar day following
the day such payment was due, at a rate per annum equal to two percent (2%)
above the rate of interest then applicable thereto (or, if no rate of interest
is then applicable thereto, the Base Rate) until such amount shall be paid in
full (after as well as before judgment).

 

§3.12.             Replacement of Individual Lenders.  Upon
the happening of any of the events set forth in §§2.3.2, 3.3.2, 3.3.3, 3.6,
3.7, 3.8 or 3.13 hereof, or in the case of a Delinquent Lender, the Borrower
may (provided that at the time no Default or Event of Default exists or
would result after giving effect to the Borrower’s action) prepay in full all
Loans and other obligations owing by the Borrower to each affected Lender under

 

27

 

§§2.3.2, 3.3.2, 3.3.3, 3.6,
3.7, 3.8 or 3.13 hereof and/or each Delinquent Lender (each such Lender being
called a “Substituted Lender”), together
with all amounts payable by the Borrower under §3.10 hereof with respect to
such prepayment, and terminate the Commitment(s) of such Lender(s) subject
to the following conditions:

 

(a)                                 the Borrower shall
have delivered to the Administrative Agent not less than ten (10) Business
Days (or, in the case of a replacement of a Delinquent Lender, such lesser
number of Business Days acceptable to the Administrative Agent) prior to the
exercise of its rights under this §3.12 a written commitment in form and
substance satisfactory to the Administrative Agent and each of the Lenders from
a financial institution (the “Replacement  Lender”) reasonably
acceptable to the Administrative Agent and each of the remaining Lenders (other
than the Substituted Lender) in which such Replacement Lender agrees to become
a “Lender” under this Credit Agreement, having a Commitment Amount in the
amount of the Substituted Lender’s Commitment Amount;

 

(b)                                the Borrower shall have
given appropriate notice of any prepayment under this §3.12 as required by §3.7
hereof and subject to all other provisions of this Credit Agreement; and

 

(c)                                 simultaneously with
any prepayment of all Loans and other obligations owing by the Borrower to a
Substituted Lender under this §3.12, the Substituted Lender shall have
assigned, pursuant to §18 hereof the Commitment of such Substituted Lender to
the Replacement Lender and such Replacement Lender shall have become a Lender
under this Credit Agreement, having a Commitment Amount in the amount of such
Substituted Lender’s Commitment Amount and such Replacement Lender shall have
simultaneously funded all such Loans prepaid hereunder. Each of the Lenders
agrees that in the event that it becomes a Substituted Lender pursuant to this
§3.12, it will cooperate and assign its Commitment pursuant to this §3.12(c).

 

§3.13.             Additional Reserve Requirements.  The Borrower shall pay to each Lender, as long as such Lender shall be required to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each
Eurocurrency Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which in each case shall be due and payable on each date on which interest is payable on
such Loan, provided the Borrower shall have received at least ten (10) days’
prior notice (with a copy to the Administrative Agent) of such additional interest
or costs from such Lender.  If a Lender fails to give notice ten (10) days
prior to the relevant Interest Payment Date, such additional interest or
costs shall be due and payable ten (10) days
from receipt of such notice.

 

§3.14.             Guaranties.  The
payment and performance of the Obligations shall be guaranteed by each
Guarantor pursuant to the Guaranties, each of which shall be in the form of Exhibit B  hereto. 
The Borrower may cause additional Subsidiaries of the 

 

28

 

Borrower to become
Guarantors hereunder by causing such Subsidiary or Subsidiaries to agree to be
bound by the provisions of the Guaranty, to execute and deliver a Joinder
Agreement and to deliver such legal opinions and other documents and
instruments as the Administrative Agent may request.  The Administrative Agent and the Lenders
hereby agree that they shall, upon the written request of the Borrower and at
the cost and expense of the Borrower, release any Guarantor from its obligations
to the Administrative Agent and the Lenders under the Guaranty to which such
Guarantor is a party if, and only if, (a) such Guarantor is not a
guarantor of any of the Borrower’s publicly issued notes or bonds outstanding
from time to time, (b) no Default or Event of Default shall have occurred
and be continuing on the date of such release and (c) the Borrower shall
have delivered to the Administrative Agent and the Lenders on the date of such
release a certificate signed by an authorized officer of the Borrower and
evidence satisfactory to the Administrative Agent and the Lenders showing
compliance with the provisions of clauses (a) and (b) of this
§3.14.  The Borrower shall deliver to the
Lenders an updated Schedule  2 upon the release or addition of any
Guarantor as provided in this §3.14.

 

§4.                              REPRESENTATIONS
AND WARRANTIES.

 

The Borrower represents and warrants to the Lenders and the
Administrative Agent as follows:

 

§4.1.                    Corporate Authority.

 

§4.1.1.          Incorporation; Good Standing.  The Borrower and each
Guarantor (a) is a corporation (or similar business entity) or, as the
case may be, a Massachusetts Business Trust duly organized, validly existing
and in good standing under the laws of its state of incorporation or
organization, (b) has all requisite corporate (or the equivalent company)
or, as the case may be, trust power to own its property and conduct its
business as now conducted and as presently contemplated, and (c) is in
good standing as a foreign corporation (or similar business entity) and is duly
authorized to do business in each jurisdiction where such qualification is
necessary except where a failure to be so qualified would not have a materially
adverse effect on the business, assets or financial condition of the Borrower.

 

§4.1.2.          Authorization.  The execution, delivery and performance of
this Credit Agreement and the other Loan Documents by the Borrower and each
Guarantor which is or is to become a party thereto, and the transactions
contemplated hereby and thereby (a) are within the corporate (or the
equivalent company) or, as the case may be, trust authority of such Person, (b) have
been duly authorized by all necessary corporate (or the equivalent company) or,
as the case may be, trust proceedings, (c) do not conflict with or result
in any breach or contravention of any provision of law, statute, rule or
regulation to which such Person is subject which would have a material adverse
effect either individually or in the aggregate on the Borrower and its
Subsidiaries taken as a whole or on the ability of such Person to fulfill its
obligations under this Credit Agreement and the other Loan Documents to which
it is a party, (d) do not conflict with or result in any breach or
contravention of any judgment, order, writ, injunction, license 

 

29

 

or permit applicable to the
Borrower or any Guarantor and (e) do not conflict with any provision of
the corporate charter or bylaws (or similar constitutive documents) or, as the
case may be, the Agreement and Declaration of Trust of, or any agreement or
other instrument binding upon, the Borrower or any Guarantor.

 

§4.1.3.          Enforceability.  The execution and delivery of this Credit
Agreement and the other Loan Documents to which the Borrower or any Guarantor
is or is to become a party will result in valid and legally binding obligations
of such Person enforceable against it in accordance with the respective terms
and provisions hereof and thereof, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting generally the enforcement of creditors’ rights and except to the
extent that availability of the remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding
therefor may be brought.

 

§4.2.                    Governmental Approvals.  The
execution, delivery and performance by the Borrower and the Guarantors of this
Credit Agreement and the other Loan Documents to which the Borrower or any
Guarantor is or is to become a party and the transactions contemplated hereby
and thereby do not require the approval or consent of, or filing with, any
Governmental Authority other than those already obtained.

 

§4.3.                    Title to Properties; Leases. 
Except as indicated on Schedule  4.3 hereto, the Borrower
and its Subsidiaries own all of the assets reflected in the consolidated
balance sheet of the Borrower as at the Balance Sheet Date or acquired since
that date (except property and assets sold or otherwise disposed of in the
ordinary course of business since that date), subject to no rights of others,
including any mortgages, leases, conditional sales agreements, title retention
agreements, liens or other encumbrances except Permitted Liens.

 

§4.4.                    Financial Statements; Fiscal Year.  (a)  There has been furnished to each of
the Lenders an audited consolidated balance sheet of the Borrower and its Subsidiaries as at
the Balance Sheet Date, and consolidated statements of income and cash flows of
the Borrower and its Subsidiaries
for the fiscal year then ended, certified by Ernst & Young LLP.  Such balance sheet and statements of income
and cash flows have been prepared in accordance with GAAP and fairly present
the financial condition of the Borrower
and its Subsidiaries as at the close of business on the date thereof and the
results of operations for the fiscal year then ended.  There are no contingent liabilities of the Borrower or any of its Subsidiaries as
of such date involving material amounts, known to the officers of the Borrower, which were not disclosed in
such balance sheet and the notes related thereto.

 

(b)                                The Borrower has a fiscal year which is the
52/53 week period ending on the Saturday closest to January 31st  of each year.

 

§4.5.                    No Material Changes, Etc.  Since
the Balance Sheet Date there has occurred no change in the operations,
business, properties, assets or financial condition of 

 

30

 

the Borrower and its
Subsidiaries as shown on or reflected in the consolidated balance sheet of the
Borrower and its Subsidiaries as at the Balance Sheet Date, or the consolidated
statements of income and cash flows for the fiscal year then ended, other than
changes in the ordinary course of business that have not had any materially
adverse effect either individually or in the aggregate on the business, assets
or financial condition of the Borrower and its Subsidiaries taken as a
whole.  Since the Balance Sheet Date, the
Borrower has not made any Distributions except Distributions made in compliance
with §6.4 hereof.

 

§4.6.                    Franchises, Patents, Copyrights,
Etc.  The Borrower and each of its Subsidiaries
possesses all franchises, patents, copyrights, trademarks, trade names,
licenses and permits, and rights in respect of the foregoing, adequate for the
conduct of its business substantially as now conducted without known conflict
with any rights of others.

 

§4.7.                    Litigation. 
Except as set forth in Schedule  4.7 hereto, there are no
actions, suits, proceedings or investigations of any kind pending or, to the
best of the Borrower’s knowledge, threatened against the Borrower or any of its
Subsidiaries before any court, tribunal or administrative agency or board that,
either in any case or in the aggregate, would be reasonably likely to (i) materially
adversely affect the properties, assets, financial condition or business of the
Borrower and its Subsidiaries taken as a whole, (ii) materially impair the
right of the Borrower and each of its Subsidiaries to carry on business
substantially as now conducted by it, (iii) result in any substantial
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the consolidated balance sheet of the Borrower and its
Subsidiaries or (iv) question the validity of this Credit Agreement or any
of the other Loan Documents, or any action taken or to be taken pursuant hereto
or thereto.

 

§4.8.                    Compliance with Other
Instruments, Laws, Etc.  Neither the Borrower nor any of its
Subsidiaries is in violation of any provision of its charter documents, bylaws
(or equivalent constitutive documents), or any agreement or instrument to which
it may be subject or by which it or any of its properties may be bound or any
decree, order, judgment, statute, license, rule or regulation, in any of
the foregoing cases in a manner that could result in the imposition of
substantial penalties or materially and adversely affect the financial
condition, properties or business of the Borrower and its Subsidiaries taken as
a whole.

 

§4.9.                    Tax Status.  The
Borrower and each of its Subsidiaries (a) has made or filed all applicable
federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which it is subject, (b) has paid all
taxes and other governmental assessments and charges shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith and by appropriate proceedings and (c) has set aside on its
books provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations
apply.  Except as set forth on Schedule
4.9 hereto, there are no 

 

31

 

unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the
officers of the Borrower know of no basis for any such claim.

 

§4.10.             No Event of Default.  No
Default or Event of Default has occurred and is continuing.

 

§4.11.             Investment Company Act. 
Neither the Borrower nor any of its Subsidiaries is an “investment
company”, or a “principal  underwriter” of an  “investment  company”, or a
company controlled by an “investment  company”, as such terms are
defined in the Investment Company Act of 1940.

 

§4.12.             Employee Benefit Plans.

 

§4.12.1.   In General.  Each Employee Benefit Plan has been
maintained and operated in compliance in all material respects with the
provisions of ERISA, all Applicable Pension Legislation, and, to the extent
applicable, the Code, including but not limited to the provisions thereunder
respecting the bonding of fiduciaries and other persons handling plan funds as
required by §412 of ERISA.  No prohibited
transaction has occurred that would result in material liability for the Borrower
or any of its Subsidiaries.

 

§4.12.2.   Terminability of Welfare Plans.  No Employee Benefit Plan which
is an employee welfare benefit plan within the meaning of §3(1) or §3(2)(B) of
ERISA provides benefit coverage subsequent to termination except as required by
Title I, Subtitle B, Part 6 of ERISA or applicable state law. The Borrower
may terminate each such Plan at any time (or at any time subsequent to the
expiration of any applicable bargaining agreement) in the discretion of the
Borrower without liability to any Person other than for claims arising or
benefits accruing prior to termination.

 

§4.12.3.   Guaranteed Pension Plans.  Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be made to avoid the
incurrence of an accumulated funding deficiency, the notice or lien provisions
of §302(f) of ERISA, or otherwise, has been timely made.  No waiver of an accumulated funding
deficiency or extension of amortization periods has been received with respect
to any Guaranteed Pension Plan, and neither the Borrower nor any ERISA
Affiliate is obligated to or has posted security in connection with an
amendment to a Guaranteed Pension Plan pursuant to §307 of ERISA or §401(a)(29)
of the Code.  No liability to the PBGC
(other than required insurance premiums, all of which have been paid) has been
incurred by the Borrower or any ERISA Affiliate with respect to any Guaranteed
Pension Plan and there has not been any ERISA Reportable Event, or any other
event or condition which presents a material risk of termination of any
Guaranteed Pension Plan by the PBGC. Based on the latest valuation of each
Guaranteed Pension Plan (which in each case occurred within twelve months of
the date of this representation), and on the actuarial methods and assumptions
employed for that valuation, except as set forth on Schedule  4.12
hereto, the aggregate benefit liabilities of all such Guaranteed Pension Plans
within the meaning of §4001 of ERISA did not exceed the aggregate value of the
assets of all 

 

32

 

such Guaranteed Pension
Plans, disregarding for this purpose the benefit liabilities and assets of any
Guaranteed Pension Plan with assets in excess of benefit liabilities.

 

§4.12.4.   Multiemployer Plans.  Neither the Borrower nor any ERISA Affiliate
has incurred any material liability (including secondary liability) to any
Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan under §4201 of ERISA or as a result of a sale of assets
described in §4204 of ERISA.  Neither the
Borrower nor any ERISA Affiliate has been notified that any Multiemployer Plan
is in reorganization or insolvent under and within the meaning of §4241 or
§4245 of ERISA or is at risk of entering reorganization or becoming insolvent,
or that any Multiemployer Plan intends to terminate or has been terminated
under §4041A of ERISA.

 

§4.13.             Regulations U and X, Etc.  The
proceeds of the Loans shall be used for the purposes described in §5.12
hereof.  The Borrower is not engaged in
the business of extending credit for the purpose of purchasing or carrying
Margin Stock, and no portion of any Loan is to be used for the purpose of
purchasing or carrying any “margin  security” (as such term is
defined in Regulation X) or Margin Stock in violation of the Margin
Regulations.  Following application of
the proceeds of each Loan, not more than twenty-five percent (25%) of the value
of the assets of the Borrower and its Subsidiaries on a consolidated basis will
consist of Margin Stock.

 

§4.14.             Environmental Compliance.  The
Borrower has taken all reasonably necessary steps to investigate the past and
present condition and usage of the Real Estate and the operations conducted
thereon and, based upon such diligent investigation, has determined that:

 

(a)                                 none of the Borrower,
its Subsidiaries nor any operator of the Real Estate or any operations thereon
is in violation, or alleged violation, of any Environmental Laws, which
violation would have a material adverse effect on the business, assets or
financial condition of the Borrower and its Subsidiaries taken as a whole;

 

(b)                                neither the Borrower
nor any of its Subsidiaries has received any Environmental Notice during the
last five (5) years that has the potential to materially affect the
assets, liabilities, financial condition or operations of the Borrower and its
Subsidiaries taken as a whole, except as set forth on Schedule  4.14
hereto;

 

(c)                                 except as set forth on
Schedule  4.14 hereto: (i) no portion of the Real Estate has been
used for the handling, processing, storage or disposal of Hazardous Substances;
and no underground tank or other underground storage receptacle for Hazardous
Substances is located on any portion of the Real Estate; in each case except in
accordance with applicable Environmental Laws the noncompliance with which
would have a material adverse effect on the business, assets or financial
condition of the Borrower and its Subsidiaries, taken as a whole; (ii) in
the course of any activities conducted by the Borrower or operators of its
properties, no Hazardous Substances have 

 

33

 

been generated or are being used on the Real
Estate except in accordance with applicable Environmental Laws the
noncompliance with which would have a material adverse effect on the business,
assets or financial condition of the Borrower and its Subsidiaries, taken as a
whole; (iii) there have been no releases or threatened releases of
Hazardous Substances on, upon, into or from the properties of the Borrower or
any of its Subsidiaries, which releases would have a material adverse effect on
the business, assets or financial condition of the Borrower and its
Subsidiaries, taken as a whole; (iv) to the best of the Borrower’s
knowledge, there have been no releases on, upon, from or into any real property
in the vicinity of any of the Real Estate which, through soil or groundwater
contamination, may have come to be located on the Real Estate and which would
have a material adverse effect on the Borrower and its Subsidiaries, taken as a
whole; and (v) in addition, any Hazardous Substances that have been
generated on any of the Real Estate have, to the best of the Borrower’s
knowledge, been transported offsite only as required under and in compliance
with applicable Environmental Laws.

 

§4.15.             Foreign Assets Control
Regulations, Etc.  None of the requesting or borrowing of the
Loans, or the use of the proceeds of any thereof will violate the Trading With
the Enemy Act (50 U.S.C. § 1 et seq., as amended) (the “Trading  With
the  Enemy  Act”) or any of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) (the “Foreign  Assets  Control  Regulations”)
or any enabling legislation or executive order relating thereto (which for the
avoidance of doubt shall include, but shall not be limited to (a) Executive
Order 13224 of September 21, 2001 Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(66 Fed. Reg. 49079 (2001)) (the “Executive  Order”) and (b) the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)).  Furthermore, neither the Borrower nor any of
its Subsidiaries or, to Borrower’s knowledge, other Affiliates (a) is or
will become a “blocked person” as described in the Executive Order, the Trading
With the Enemy Act or the Foreign Assets Control Regulations or (b) engages
or will engage in any dealings or transactions, or be otherwise associated,
with any such “blocked person”.

 

§4.16.             Subsidiaries, Etc.  As of
the Effective Date, other than those Subsidiaries of the Borrower described on Schedule 4.16(a) hereto, the Borrower has
no other Subsidiaries.  As of the
Effective Date, except as set forth on Schedule  4.16(b) hereto, neither the Borrower nor any Subsidiary of the
Borrower is engaged in any joint venture or partnership with any other
Person.  As of the Effective Date, except
as set forth on Schedule  4.16(c) hereto, neither the Borrower nor
any Subsidiary of the Borrower owns or has acquired an equity interest of fifty
percent (50%) or less in any other Person. 
The Borrower hereby agrees to deliver to the Lenders an updated Schedule
4.16(a), Schedule  4.16(b) or Schedule  4.16(c),
as applicable, upon the acquisition or formation by the Borrower of any
Subsidiary, the formation of any joint venture or partnership by the Borrower
or any of its Subsidiaries with any other Person or the acquisition by the
Borrower or any of its Subsidiaries of an equity interest of fifty percent
(50%) or less in any other Person, in each case in accordance with the
provisions of this Credit Agreement.

 

34

 

§4.17.             Taxpayer Identification
Numbers.  The true and correct U.S. taxpayer
identification number of the Borrower and each Guarantor as of the Effective
Date is set forth on Schedule  4.17 hereto.

 

§5.                              AFFIRMATIVE
COVENANTS OF THE BORROWER.

 

The Borrower covenants and agrees that, so long as any Loan is
outstanding or any Lender has any obligation to make any Loans:

 

§5.1.                    Punctual Payment.  The
Borrower will duly and punctually pay or cause to be paid the principal and
interest on the Loans, the Commitment Fee, the Administrative Agent Fees, all
other fees and other amounts provided for in this Credit Agreement and the
other Loan Documents to which the Borrower is a party, all in accordance with
the terms of this Credit Agreement and such other Loan Documents.

 

§5.2.                    Maintenance of Office.  The
Borrower will maintain its chief executive office in Framingham, Massachusetts,
or at such other place in the United States of America as the Borrower shall
designate upon written notice to the Administrative Agent, where notices,
presentations and demands to or upon the Borrower in respect of the Loan
Documents to which the Borrower is a party may be given or made.

 

§5.3.                    Records and Accounts.  The
Borrower will (a) keep, and cause each of its Subsidiaries to keep, true
and accurate records and books of account in which full, true and correct
entries will be made in accordance with GAAP and (b) maintain adequate
accounts and reserves for all taxes, depreciation, depletion, obsolescence and
amortization of its properties and the properties of its Subsidiaries,
contingencies, and other reserves.

 

§5.4.                    Financial Statements,
Certificates and Information.  The Borrower will deliver to
the Administrative Agent (and the Administrative Agent will promptly, after
receipt thereof, deliver to the Lenders):

 

(a)                                 as soon as
practicable, but in any event not later than ninety (90) days after the end of
each fiscal year of the Borrower, (i) the consolidated balance sheet of
the Borrower and its Subsidiaries as at the end of such year, and the related
consolidated statement of income and consolidated statement of cash flows for
such year, each setting forth in comparative form the figures for the previous
fiscal year and all such consolidated statements to be in reasonable detail,
prepared in accordance with GAAP, and certified without qualification by Ernst &
Young LLP, any nationally recognized firm of independent certified public
accountants or by other independent certified public accountants reasonably
satisfactory to the Administrative Agent and (ii) a statement certified by
the chief financial officer or the treasurer of the Borrower in substantially
the form of Exhibit C hereto (a “Compliance Certificate”) and setting forth in reasonable detail
computations evidencing compliance with the covenants contained in §7 hereof 

 

35

 

and (if applicable)
reconciliations to reflect changes in GAAP since the Balance Sheet Date;

 

(b)                                as soon as practicable,
but in any event not later than forty-five (45) days after the end of each of
the first three fiscal quarters of each fiscal year of the Borrower, (i) copies
of the unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarter, and the related consolidated statement
of income and consolidated statement of cash flows for the portion of the
Borrower’s fiscal year then elapsed, all in reasonable detail and prepared in
accordance with GAAP, together with a certification by the chief financial
officer or the treasurer of the Borrower that to the best of the Borrower’s
knowledge, the information contained in such financial statements fairly
presents the financial position of the Borrower and its Subsidiaries on the
date thereof (subject to year-end adjustments) and (ii) a Compliance
Certificate as of such fiscal quarter end;

 

(c)                                 from time to time such
other financial data and information as the Administrative Agent or any Lender
may reasonably request;

 

(d)                                (i) promptly upon
becoming aware of the occurrence of any actual or claimed “Event of Termination”
or similar event under and as defined in any of the documents relating to any
receivables securitization transaction or other financing of any special
purpose receivables Subsidiary of the Borrower, entered into or guaranteed by
the Borrower and/or any of its Subsidiaries and then in effect, notice thereof,
which notice shall describe such Event of Termination or similar event and
indicate what steps the Borrower and its Subsidiaries are taking to remedy the
same and (ii) promptly upon request therefor, such other information with
respect thereto as the Administrative Agent shall reasonably request;

 

(e)                                 promptly after the
same are available, copies of each annual report, proxy or financial statement
or other report or communication sent to the stockholders of the Borrower, and
copies of all annual, regular, periodic and special reports and registration
statements which the Borrower may file or be required to file with the
Securities Exchange Commission under Section 13 or 15(d) of the
Securities Exchange Act of 1934, and not otherwise required to be delivered to
the Administrative Agent pursuant hereto; and

 

(f)                                   promptly after the
same are available, copies of each of the Offer Documents.

 

All Confidential Information concerning the Borrower supplied by the
Borrower to the Lenders pursuant to the terms hereof will be held in confidence
by the Lenders and the Lenders shall not disclose such Confidential Information
except as permitted by §26 hereof.

 

Documents required to be delivered pursuant to this §5.4 (to the extent
any such documents are included in materials otherwise filed with the SEC) may
be delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) 

 

36

 

on which the Borrower posts such documents, or provides a link thereto
on the Borrower’s website on the Internet at staples.com; or (ii) on which
such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent has access
(whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that: (i) the Borrower shall
deliver paper copies of such documents to the Administrative Agent or any
Lender that requests in writing that the Borrower deliver such paper copies
until a written request to cease delivering paper copies is given by the
Administrative Agent or such Lender and (ii) the Borrower shall notify the
Administrative Agent (by telecopier or electronic mail) of the posting of any
such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents.  Notwithstanding anything contained herein, in
every instance the Borrower shall be required to provide paper copies of the
Compliance Certificates required by §§5.4(a) and (b) hereof to the
Administrative Agent.  Except for such
Compliance Certificates, the Administrative Agent shall have no obligation to request
the delivery or to maintain copies of the documents referred to above, and in
any event shall have no responsibility to monitor compliance by the Borrower
with any such request for delivery, and each Lender shall be solely responsible
for requesting delivery to it or maintaining its copies of such documents.

 

The Borrower hereby acknowledges that (i) the Administrative Agent
and/or the Arranger will make available to the Lenders materials and/or
information provided by or on behalf of the Borrower hereunder (collectively, “Borrower
Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system (the “Platform”) and (ii) certain of the
Lenders may be “public-side” Lenders (i.e.,
Lenders that do not wish to receive material non-public information with
respect to the Borrower or its securities) (each, a “Public  Lender”).  The Borrower hereby agrees that (A) all
Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked “PUBLIC” by the Borrower which, at a minimum,
shall mean that the word “PUBLIC” shall appear prominently on the first page thereof;
(B) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed
to have authorized the Administrative Agent, the Arranger and the Lenders to
treat such Borrower Materials as not containing any material non-public
information with respect to the Borrower or its securities for purposes of
United States Federal and state securities laws (provided, however,
(x) to the extent such Borrower Materials constitute Confidential
Information, they shall be treated as set forth in §26 hereof and (y) to
the extent such Borrower Materials are not marked “PUBLIC” and posted on the
Platform, such Borrower Materials will also be subject to the additional
confidentiality provisions included on the Platform); (C) all Borrower
Materials marked “PUBLIC” are permitted to be made available through a portion
of the Platform designated “Public Investor;” and (D) the Administrative
Agent and the Arranger shall be entitled to treat any Borrower Materials that
are not marked “PUBLIC” as being suitable only for posting on a portion of the
Platform not designated “Public Investor” and the Administrative Agent and the
Lenders agree not to trade securities on the basis of any Borrower Materials
that are posted on the Platform and are not marked “PUBLIC.”  Notwithstanding the foregoing, the Borrower
shall be under no obligation to mark any Borrower Materials “PUBLIC.”

 

37

 

§5.5.                    Notices. The Borrower will promptly notify the
Administrative Agent for the benefit of the Lenders in writing of the
occurrence of any Default or Event of Default. The Borrower will promptly give
notice to the Administrative Agent for the benefit of the Lenders (a) of
any material violation of any Environmental Law that the Borrower or any of its
Subsidiaries reports in writing or is reportable by such Person in writing (or
for which any written report supplemental to any oral report is made) to any federal,
state or local environmental agency, (b) upon becoming aware thereof, of
any inquiry, proceeding, investigation, or other action, including a notice
from any agency of potential environmental liability, or any federal, state or
local environmental agency or board, that has the potential to materially
affect the assets, liabilities, financial conditions or operations of the
Borrower, (c) upon becoming aware thereof, of any inquiry, proceeding,
investigation, or other action, including a notice from any agency of potential
ERISA liability, that has the potential to materially affect the assets,
liabilities, financial conditions or operations of the Borrower and (d) of
any material change in accounting policies or financial reporting practices by
the Borrower or any Subsidiary of the Borrower. The Borrower will give notice
to the Administrative Agent for the benefit of the Lenders in writing within
fifteen (15) days of becoming aware of any litigation or proceedings threatened
in writing or any pending litigation and proceedings affecting the Borrower or
any of its Subsidiaries or to which the Borrower or any of its Subsidiaries is
or becomes a party involving an uninsured claim against the Borrower or any of
its Subsidiaries that could reasonably be expected to have a materially adverse
effect on the Borrower and its Subsidiaries taken as a whole and stating the
nature and status of such litigation or proceedings. The Borrower will, and
will cause each of its Subsidiaries to, give notice to the Administrative Agent
for the benefit of the Lenders, in writing, in form and detail satisfactory to
the Administrative Agent, within ten (10) days of any judgment not covered
by insurance, final or otherwise, against the Borrower or any of its
Subsidiaries in an amount in excess of $25,000,000.

 

§5.6.                    Legal Existence; Maintenance of
Properties. The Borrower
will do or cause to be done all things necessary to preserve and keep in full
force and effect its legal existence, rights and franchises and those of its
Subsidiaries and will not, and will not cause or permit any of the Guarantors
to, convert to a limited liability company or a limited liability partnership
unless simultaneously with such conversion the Borrower or such Guarantor shall
have executed and delivered to the Administrative Agent all documentation which
the Administrative Agent reasonably determines is necessary to continue the
Borrower’s or such Guarantor’s obligations in respect of this Credit Agreement
or the Guaranty, as applicable. It (a) will cause all of its properties
and those of its Subsidiaries used or useful in the conduct of its business or
the business of its Subsidiaries to be maintained and kept in good condition,
repair and working order and supplied with all necessary equipment, (b) will
cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Borrower may be necessary
so that the business carried on in connection therewith may be properly and
advantageously conducted at all times, and (c) will, and will cause each
of its Subsidiaries to, continue to engage primarily in the businesses now
conducted by them and in related businesses; provided that nothing in
this §5.6 shall prevent the Borrower from discontinuing the operation and
maintenance of any of its properties or

 

38

 

any
of those of its Subsidiaries if such discontinuance is, in the judgment of the
Borrower, desirable in the conduct of its or their business and does not in the
aggregate materially adversely affect the business of the Borrower and its
Subsidiaries on a consolidated basis.

 

§5.7.                    Insurance. The Borrower will, and will cause each of
its Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent. At the request of the Administrative Agent, the
Borrower shall deliver from time to time a summary schedule indicating all
insurance then in force with respect to the Borrower and its Subsidiaries.

 

§5.8.                    Taxes. The Borrower will, and will cause each of
its Subsidiaries to, duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all taxes, assessments and
other governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by
law become a lien or charge upon any of its property; provided that any
such tax, assessment, charge, levy or claim need not be paid if the validity or
amount thereof shall currently be contested in good faith by appropriate
proceedings and if the Borrower or such Subsidiary shall have set aside on its
books adequate reserves with respect thereto; and provided  further
that the Borrower and each Subsidiary of the Borrower will pay all such taxes,
assessments, charges, levies or claims forthwith upon the commencement of
proceedings to foreclose any lien that may have attached as security therefor
or shall have obtained such bonding as may be required to release such lien.

 

§5.9.                    Inspection of Properties and
Books, Etc.
The Borrower shall permit
the Lenders, through the Administrative Agent or any of the Lenders’ other
designated representatives, no more frequently than once each calendar year, or
more frequently as determined by the Lenders upon the occurrence and during the
continuance of an Event of Default, to visit and inspect any of the properties
of the Borrower or any of its Subsidiaries, and each such inspection, if no
Event of Default has occurred and is continuing, shall be at the Lenders’
expense. The Borrower shall also permit the Lenders, through the Administrative
Agent or any of the Lenders’ other designated representatives, to examine the
books of account of the Borrower and its Subsidiaries (and to make copies
thereof and extracts therefrom), and to discuss the affairs, finances and
accounts of the Borrower and its Subsidiaries with, and to be advised as to the
same by, its and their officers, all at such reasonable times and intervals as
the Administrative Agent or any Lender may reasonably request. The Borrower
authorizes the Administrative Agent and, if accompanied by the Administrative
Agent, the Lenders to communicate directly with the Borrower’s independent
certified public accountants and authorizes such accountants to disclose to the
Administrative Agent and the Lenders any and all financial statements and other
supporting financial documents and schedules with

 

39

 

respect
to the business, financial condition and other affairs of the Borrower or any
of its Subsidiaries.

 

§5.10.             Compliance with Laws, Contracts,
Licenses, and Permits. The
Borrower will, and will cause each of its Subsidiaries to, comply with (a) the
applicable laws and regulations wherever its business is conducted, including
all Environmental Laws, (b) the provisions of its charter documents and
by-laws (or equivalent constitutive documents), (c) all agreements and
instruments by which it or any of its properties may be bound and (d) all
applicable decrees, orders, and judgments, in each case if noncompliance with
which would have a material adverse effect on the business, assets or financial
condition of the Borrower and its Subsidiaries, taken as a whole, or on the
ability of the Borrower or any of the Guarantors to fulfill its obligations
under this Credit Agreement or any of the other Loan Documents to which such
Person is a party. If any authorization, consent, approval, permit or license
from any officer, agency or instrumentality of any government shall become
necessary or required in order that the Borrower may fulfill any of its
obligations hereunder or any of the other Loan Documents to which the Borrower
is a party, the Borrower will, or (as the case may be) will cause such
Subsidiary to, immediately take or cause to be taken all reasonable steps
within the power of the Borrower or such Subsidiary to obtain such authorization,
consent, approval, permit or license and furnish the Administrative Agent and
the Lenders with evidence thereof.

 

§5.11.             Employee Benefit Plans. The Borrower will (a) promptly upon
request of the Administrative Agent, furnish to the Administrative Agent a copy
of the most recent actuarial statement required to be submitted under §103(d) of
ERISA and Annual Report, Form 5500, with all required attachments, in
respect of each Guaranteed Pension Plan and (b) promptly upon receipt or
dispatch, furnish to the Administrative Agent any notice, report or demand sent
or received in respect of a Guaranteed Pension Plan under §§302, 4041, 4042,
4043, 4063, 4065, 4066 and 4068 of ERISA, or in respect of a Multiemployer
Plan, under §§4041A, 4202, 4219, 4242, or 4245 of ERISA.

 

§5.12.             Use of Proceeds. The Borrower will use the proceeds of the
Loans solely for working capital purposes of the Borrower and its Subsidiaries
and to finance the Transaction, including to pay related transaction fees,
costs and expenses.

 

§5.13.             Licenses and Permits. The Borrower will maintain and renew any
and all licenses or permits now held or hereafter acquired by the Borrower or
any of its Subsidiaries unless the loss, suspension, revocation or failure to
renew any such licenses or permits would not have a material adverse effect on
the business or financial condition of the Borrower and such Subsidiary.

 

§5.14.             Guaranties. In the event that any Subsidiary of the
Borrower, which is not a Guarantor hereunder, becomes a guarantor of any of the
Borrower’s publicly issued notes or bonds outstanding from time to time, the
Borrower shall cause such Subsidiary to become a Guarantor hereunder pursuant
to §3.14 hereof.

 

40

 

§5.15.             Further Assurances. The Borrower will, and will cause each of
the Guarantors to, cooperate with the Lenders and the Administrative Agent and
execute such further instruments and documents as the Lenders or the
Administrative Agent shall reasonably request to carry out to their
satisfaction the transactions contemplated by this Credit Agreement and the
other Loan Documents.

 

§6.                              CERTAIN NEGATIVE COVENANTS OF THE
BORROWER.

 

The Borrower covenants and agrees that, so long as any Loan is
outstanding or any Lender has any obligation to make any Loans:

 

§6.1.                    Restrictions on Indebtedness. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume, guarantee or become or
remain liable, contingently or otherwise, with respect to Indebtedness other than:

 

(a)                                 Indebtedness
to the Lenders and the Administrative Agent arising under any of the Loan
Documents;

 

(b)                                current
liabilities of the Borrower or such Subsidiary incurred in the ordinary course
of business not incurred through (i) the borrowing of money, or (ii) the
obtaining of credit except for credit on an open account basis customarily
extended and in fact extended in connection with normal purchases of goods and
services;

 

(c)                                 Indebtedness
in respect of taxes, assessments, governmental charges or levies and claims for
labor, materials and supplies to the extent that payment therefor shall not at
the time be required to be made in accordance with the provisions of §5.8
hereof;

 

(d)                                Indebtedness
in respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which the Borrower or such Subsidiary shall at the
time in good faith be prosecuting an appeal or proceedings for review and in
respect of which a stay of execution shall have been obtained pending such
appeal or review;

 

(e)                                 endorsements
for collection, deposit or negotiation and warranties of products or services,
in each case incurred in the ordinary course of business;

 

(f)                                   Indebtedness
in respect of documentary letters of credit issued in the ordinary course of
business;

 

(g)                                Indebtedness
of the Borrower in respect of interest rate protection arrangements and
exchange rate protection arrangements;

 

(h)                                Indebtedness
existing on the Effective Date and listed and described on Schedule 6.1
hereto or any refinancing thereof on substantially similar terms as the
Indebtedness being refinanced;

 

41

 

(i)                                    Subordinated
Debt;

 

(j)                                    obligations
under Capitalized Leases;

 

(k)                                 Indebtedness
in respect of intercompany loans, guaranties and, so long as no Default or
Event of Default shall have occurred and be continuing at the time such
Indebtedness is incurred, other Investments and contingent obligations to make
Investments, (i) from the Borrower to any of its Subsidiaries or of any of
its Subsidiaries’ obligations or (ii) between Subsidiaries of the Borrower
or of any of the Borrower’s Subsidiaries’ obligations, or (iii) from any
Subsidiary of the Borrower to the Borrower or of any of the Borrower’s
obligations;

 

(l)                                    Indebtedness
incurred in connection with the acquisition after the Effective Date of any
real or personal property by the Borrower or any Subsidiary of the Borrower as
contemplated by §6.2(ix) hereof;

 

(m)                              Indebtedness
secured by a lien on Real Estate of the Borrower or its Subsidiaries; provided
that the aggregate amount of Indebtedness permitted pursuant to this §6.1(m) shall
not, at any time, exceed the fair market value of the Real Estate securing such
Indebtedness;

 

(n)                                other
Indebtedness of the Borrower and its Subsidiaries (whether or not such
Subsidiaries are Guarantors), provided that
(i) with respect to Indebtedness incurred by the Borrower or a Guarantor,
such Indebtedness contains covenants that are no more restrictive on the
Borrower or such Guarantor than the covenants contained in this Credit
Agreement and (ii) immediately after such incurrence of Indebtedness, and
after giving effect thereto on a pro forma
basis, no Default or Event of Default shall then exist;

 

(o)                                Indebtedness
consisting of Investments permitted under §6.3(m) hereof;

 

(p)                                Indebtedness
payable at the election of the Borrower by the issuance of the Borrower’s
Capital Stock;

 

(q)                                Indebtedness
of the Borrower and its Subsidiaries in respect of receivables securitization
transactions or other financing of any special purpose receivables Subsidiary
of the Borrower, entered into or guaranteed by the Borrower and/or any of its
Subsidiaries; provided that the aggregate amount of all such
Indebtedness shall not exceed $300,000,000 outstanding at any time;

 

(r)                                   Indebtedness
of the Borrower and its Subsidiaries arising under the Revolving Credit
Agreement and any of the other “Loan Documents” as such term is defined
therein; provided that the aggregate amount of all such Indebtedness
shall not exceed $1,000,000,000 outstanding at any time;

 

42

 

(s)                                 Indebtedness
of the Borrower and its Subsidiaries arising under the Bridge Credit Agreement
and any of the other “Loan Documents” as such term is defined therein; provided
that the aggregate amount of all such Indebtedness shall not exceed
$3,000,000,000 outstanding at any time.

 

Notwithstanding the
foregoing, at no time shall the aggregate amount of Indebtedness of the
Borrower and its Subsidiaries consisting of guaranties and other Contingent
Liabilities (excluding (i) Indebtedness permitted pursuant to §6.1 hereof
to the extent such Indebtedness (or if such Indebtedness is a Contingent
Liability of the Borrower and/or its Subsidiaries, the underlying Indebtedness
relating to such Contingent Liability) is included in the calculation of
Consolidated Total Funded Debt and (ii) obligations in respect of
documentary letters of credit) exceed, in the aggregate, fifteen percent (15%)
of the Stockholders’ Equity of the Borrower at such time. For purposes of this
§6.1, the amount of Contingent Liabilities in respect of interest rate
protection arrangements and exchange rate protection arrangements permitted
under §6.1(g) hereof at any time shall be the net liability of the
Borrower and its Subsidiaries under such arrangements at such time, calculated
on a basis satisfactory to the Administrative Agent in accordance with accepted
practice.

 

§6.2.                    Restrictions on Liens. The Borrower will not, and will not permit
any of its Subsidiaries to, (a) create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (b) transfer any of such property or assets
or the income or profits therefrom for the purpose of subjecting the same to
the payment of Indebtedness or performance of any other obligation in priority
to payment of its general creditors; (c) acquire, or agree or have an
option to acquire, any property or assets upon conditional sale or other title
retention or purchase money security agreement, device or arrangement; (d) suffer
to exist for a period of more than thirty (30) days after the same shall have
been incurred any Indebtedness or claim or demand against it that if unpaid
might by law or upon bankruptcy or insolvency under the laws of the United
States of America or any state thereof, or otherwise, be given any priority
whatsoever over its general creditors; or (e) sell, assign, pledge or
otherwise transfer any accounts, contract rights, general intangibles, chattel
paper or instruments, with or without recourse; provided that the
Borrower and any Subsidiary of the Borrower may create or incur or suffer to be
created or incurred or to exist:

 

(i)                                     liens
in favor of the Borrower on all or part of the assets of Subsidiaries of the
Borrower securing Indebtedness owing by Subsidiaries of the Borrower to the
Borrower;

 

(ii)                                  liens
to secure taxes, assessments and other government charges and liens to secure
claims for labor, material or supplies, in each case in respect of obligations
not overdue or which are being contested in good faith and by appropriate
proceedings and for which the Borrower or such Subsidiary has set aside on its
books adequate reserves with respect thereto;

 

43

 

(iii)                               deposits
or pledges made in connection with, or to secure payment of, worker’s
compensation, unemployment insurance, old age pensions or other social security
obligations;

 

(iv)                              liens
in respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which the Borrower or such Subsidiary is at the
time in good faith prosecuting an appeal and in respect of which a stay of
execution shall have been obtained pending such appeal or shall have obtained
an unsecured bond sufficient to release such lien;

 

(v)                                 liens
of carriers, warehousemen, mechanics and materialmen, and other like liens, in
respect of obligations not overdue or, if such obligations are overdue, being
contested in good faith by appropriate proceedings and for which the Borrower
or such Subsidiary shall have set aside on its books adequate reserves with
respect thereto, provided that no proceeding to foreclose any such lien
shall have been commenced;

 

(vi)                              encumbrances
on Real Estate consisting of easements, rights of way, zoning restrictions,
restrictions on the use of real property and defects and irregularities in the
title thereto, landlord’s or lessor’s liens under Capitalized Leases to which
the Borrower or a Subsidiary of the Borrower is a party, and other minor liens
or encumbrances none of which in the opinion of the Borrower interferes
materially with the use of the property affected in the ordinary conduct of the
business of the Borrower and its Subsidiaries, which defects do not
individually or in the aggregate have a materially adverse effect on the
business of the Borrower individually or of the Borrower and its Subsidiaries
on a consolidated basis;

 

(vii)                           liens
existing on the Effective Date and listed on Schedule 6.2
hereto or liens on the same assets in connection with the refinancing of such
existing liens;

 

(viii)                        liens
arising in the ordinary course of business of the Borrower or a Subsidiary of
the Borrower none of which in the opinion of the Borrower interferes materially
with the use of the property affected in the ordinary course of business of the
Borrower and its Subsidiaries and which do not, individually or in the
aggregate, have a materially adverse effect on the business of the Borrower or
such Subsidiary individually or of the Borrower and its Subsidiaries on a
consolidated basis;

 

(ix)                                purchase
money security interests in or purchase money mortgages on real or personal
property acquired after the Effective Date to secure purchase money
Indebtedness of the type permitted by §6.1(l) hereof, incurred in
connection with the acquisition of such property, which security interests or
mortgages cover only the real or personal property so acquired;

 

44

 

(x)                                   liens
on accounts receivable of the Borrower and/or its Subsidiaries that are the
subject of and secure the Indebtedness permitted under §6.1(q) hereof;

 

(xi)                                liens
securing other permitted Indebtedness that does not exceed $50,000,000 in the
aggregate;

 

(xii)                             liens
in respect of the interests of lessors under Capitalized Leases; and

 

(xiii)                          liens on
Real Estate securing Indebtedness permitted under §6.1(m) hereof.

 

§6.3.                    Restrictions on Investments. The Borrower will not, and will not permit
any of its Subsidiaries to, make or permit to exist or to remain outstanding
any Investment except Investments in:

 

(a)                                 marketable
direct or guaranteed obligations of the United States of America or any country
which is a member of the OECD;

 

(b)                                demand
deposits, certificates of deposit, bankers acceptances and time deposits of (i) United
States or Canadian banks having total assets in excess of $1,000,000,000 or (ii) a
commercial bank organized under the laws of any other country which is a member
of the OECD, or a political subdivision of such country, and having total
assets in excess of $1,000,000,000, provided that such bank is acting
through a branch or agency located in the country in which its is organized or
another country which is a member of the OECD;

 

(c)                                 (i) securities
commonly known as “commercial paper” denominated in Dollars, euros, British
pounds sterling or Canadian dollars which at the time of purchase have been
rated and the ratings for which are not less than “P 1” if rated by Moody’s,
and not less than “A 1” if rated by S&P; and (ii) securities
commonly known as “short-term bank notes” issued by any Lender denominated in
Dollars or any such other currency which at the time of purchase have been
rated and the ratings for which are not less than “P 2” if rated by Moody’s,
and not less than “A 2” if rated by S&P;

 

(d)                                Investments
existing on the Effective Date and listed on Schedule 6.3
hereto;

 

(e)                                 Investments
with respect to Indebtedness permitted by §6.1(k) hereof so long as such
entities remain Subsidiaries of the Borrower;

 

(f)                                   taxable
or tax-exempt securities which at the time of purchase have been rated and the
ratings for which are not less than A 3 if rated by Moody’s, and not less
than A- if rated by S&P;

 

45

 

(g)                                Investments
consisting of loans and advances to employees of the Borrower or any Subsidiary
of the Borrower, not exceeding $10,000,000 in the aggregate at any one time
outstanding;

 

(h)                                options
to invest in or to lease real property to be used in the operations of the
Borrower or any Subsidiary of the Borrower;

 

(i)                                    guaranties
by endorsement of negotiable instruments for deposit or collection or similar
transactions effected in the ordinary course of business;

 

(j)                                    (i) the
Borrower’s or any Subsidiary’s guaranty of the Indebtedness of any Subsidiary
or the Borrower, and (ii) any other Investments by the Borrower or any
Subsidiary of the Borrower in any Subsidiary of the Borrower or the Borrower;

 

(k)                                 Investments
by the Borrower or any Subsidiary of the Borrower to acquire a more than fifty
percent (50%) equity interest in any Person, provided that such
acquisition is permitted under §6.6 hereof;

 

(l)                                    Investments
by the Borrower or any Subsidiary of the Borrower to acquire up to a fifty
percent (50%) equity interest in another Person, provided that (i) such
Person is in the same line of business as the Borrower or such Subsidiary, as
applicable and (ii) the aggregate amount of (A) such Investments in such
Person and (B) existing Investments made by the Borrower or any Subsidiary
of the Borrower pursuant to this §6.3(l) shall at no time exceed
sixty-five percent (65%) of the Stockholders’ Equity of the Borrower;

 

(m)                              Investments
consisting of Distributions permitted by §6.4 hereof;

 

(n)                                Investments
consisting of loans and advances to, guaranties of the obligations of and
equity Investments in, Persons in a related line of business as the Borrower,
not exceeding $25,000,000 in the aggregate at any one time outstanding;

 

(o)                                shares
of money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of clauses (a) (b), (c) and (f) contained
in this §6.3;

 

(p)                                shares
of money market mutual or similar funds which have an Aaa or MR1+ money market
fund rating from Moody’s or an AAA money market fund rating from S&P; and

 

(q)                                the
Corporate Express Acquisition.

 

§6.4.                    Distributions. The Borrower will not declare any dividend
or make any Distribution if any Default or Event of Default has occurred and is
continuing or would result after giving effect to such Distribution.

 

46

 

§6.5.                    Employee Benefit Plans. Neither the Borrower nor any ERISA
Affiliate will: (a) engage in any “prohibited
transaction” within the meaning of §406 of ERISA or §4975 of the Code which
could result in a material liability for the Borrower or any of its
Subsidiaries; or (b) permit any Guaranteed Pension Plan to incur an “accumulated
funding  deficiency”, as such term is defined in §302 of ERISA,
whether or not such deficiency is or may be waived; or (c) fail to
contribute to any Guaranteed Pension Plan to an extent which, or terminate any
Guaranteed Pension Plan in a manner which, could result in the imposition of a
lien or encumbrance on the assets of the Borrower or any of its Subsidiaries
pursuant to §302(f) or §4068 of ERISA; or (d) amend any Guaranteed
Pension Plan in circumstances requiring the posting of security pursuant to
§307 of ERISA or §401(a)(29) of the Code; or (e) permit or take any action
which would result in the aggregate benefit liabilities (with the meaning of
§4001 of ERISA) of all Guaranteed Pension Plans exceeding the value of the
aggregate assets of such Plans, disregarding for this purpose the benefit
liabilities and assets of any such Plan with assets in excess of benefit
liabilities.

 

§6.6.                    Merger and Consolidation;
Acquisitions. The
Borrower will not, and will not permit any of its Subsidiaries to, merge or
consolidate with any other Person; enter into any stock or asset acquisitions
(other than the acquisition of assets in the ordinary course of such Person’s
business and other than the acquisition of stock permitted under §§6.3(j), 6.3(l) or
6.3(q) hereof); enter into any joint venture or partnerships (except to
the extent permitted under §6.3 hereof); or enter into any new lines of
business or otherwise change the conduct of the Borrower’s or such Subsidiary’s
business as presently conducted other than (a) the merger or consolidation
of one or more Subsidiaries of the Borrower with and into the Borrower, provided
that the Borrower is the surviving entity, (b) the merger or consolidation
of two (2) or more Subsidiaries of the Borrower, provided that, if
one of the Subsidiaries is a Guarantor, that the Guarantor is the surviving
entity, or (c) (other than with respect to the Corporate Express
Acquisition) the acquisition (whether of stock or assets or by means of a
merger) of (i) a more than fifty percent (50%) equity interest in any
other Person or (ii) assets of any other Person; provided that (A) immediately
after such acquisition, and after giving effect thereto on a pro forma basis, no Default or Event of Default shall then
exist, (B) if required by applicable law, the board of directors and the
shareholders or the equivalent, of such other Person has approved such
acquisition, (C) such other Person is in the business of selling office
services, products and/or supplies, and (D) if the Borrower or a Guarantor
and such other Person merge, the Borrower or such Guarantor is the surviving
entity.

 

§6.7.                    Disposition of Assets and
Sale-Leaseback Transactions.
The Borrower will not, and will not permit any of its Subsidiaries to, dispose
of or sell assets other than:

 

(a)                                 the
disposition of assets in the ordinary course of business;

 

(b)                                sale-leaseback
transactions and other dispositions of assets that do not have a materially
adverse effect on the business, assets or financial condition of the Borrower
or any of its Subsidiaries, provided that (i) the aggregate net
book value of the

 

47

 

assets to be
sold plus the net book value of all other assets of the Borrower and its
Subsidiaries sold under this clause (b) during the period of time from the
Effective Date through the date of such sale does not, at the time of such
sale, exceed twenty-five percent (25%) of the Consolidated Total Assets of the
Borrower and its Subsidiaries and (ii) such assets are sold in an arm’s
length transaction for fair market value (after giving effect to all tax
benefits, if any, associated with such sale); and

 

(c)                                 the
sale of accounts receivable of the Borrower and/or its Subsidiaries pursuant to
the transactions permitted under §6.1(q) hereof.

 

§6.8.                    Subordinated Debt. The Borrower will not effect or permit any
change in or amendment to any document or instrument pertaining to the
subordination, covenants, events of default, terms of payment or required
prepayments of any Subordinated Debt, give any notice of redemption or prepayment
or offer to repurchase under any such document or instrument or, directly or
indirectly, make any payment of principal of or interest on or in redemption,
retirement or repurchase of any Subordinated Debt, except that (a) the
Borrower may make regularly scheduled payments when required by the terms of
the Subordinated Debt, and (b) the Borrower may refinance all or a portion
of the Subordinated Debt so long as such refinancing Subordinated Debt (i) has
a maturity that is no earlier than the Subordinated Debt being refinanced and (ii) is
subordinated to the Obligations on terms at least as favorable to the
Administrative Agent and the Lenders, in the opinion of the Administrative
Agent and the Required Lenders, as the Subordinated Debt being refinanced.

 

§6.9.                    Transactions with Affiliates. The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any transaction of any kind with any
Affiliate of the Borrower (excluding transactions between the Borrower and any
of its Subsidiaries and transactions between any Subsidiary of the Borrower and
any other Subsidiary of the Borrower), whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
the Borrower or such Subsidiary as would be obtainable by the Borrower or such
Subsidiary at the time in a comparable arm’s length transaction with a Person
other than an Affiliate.

 

§7.                              FINANCIAL COVENANTS OF THE
BORROWER.

 

The Borrower covenants and agrees that, so long as any Loan is outstanding
or any Lender has any obligation to make any Loans:

 

§7.1.                    Fixed Charge Coverage Ratio. As at the end of each fiscal quarter of the
Borrower, the Borrower will not permit the ratio (the “Fixed  Charge
Coverage  Ratio”) of (a) the sum of (i) Consolidated
EBIT for the period of the four consecutive fiscal quarters (the “Measurement
Period”) ending on such date plus (ii) the Rental Expense for such
Measurement Period, to (b) the sum of (i) the Consolidated Total
Interest Expense for such Measurement Period plus (ii) the Rental Expense
for such Measurement Period, to be less than 1.50 to 1.

 

48

 

§7.2.                    Adjusted Funded Debt to Total
Capitalization Ratio. As
at the end of each fiscal quarter of the Borrower, the Borrower will not permit
the ratio of (a) Consolidated Adjusted Funded Debt as at such date to (b) the
sum of (i) Consolidated Adjusted Funded Debt as at such date plus (ii) Stockholders’
Equity as of such date, to be greater than 0.75 to 1.

 

§8.                               EFFECTIVE
DATE CONDITIONS.

 

This Credit Agreement shall become effective on the date (the “Effective
Date”) on which each of the following conditions precedent is satisfied
(or waived in accordance with §25 hereof):

 

§8.1.                    Loan Documents. Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto, shall be in full
force and effect and shall be in form and substance satisfactory to each of the
Lenders. The Administrative Agent shall have received a fully executed
counterpart of each such document.

 

§8.2.                    Certified Copies of Charter
Documents. The
Administrative Agent shall have received from the Borrower and each of the
Guarantors a copy, certified by a duly authorized officer of such Person to be
true and complete on the Effective Date, of each of (a) its charter or
other incorporation documents (or the equivalent constitutive documents) as in
effect on such date of certification, and (b) its by-laws or the
equivalent constitutive documents as in effect on such date.

 

§8.3.                    Corporate Action. All corporate (or other) action necessary
for the valid execution, delivery and performance by the Borrower and each of
the Guarantors of this Credit Agreement and the other Loan Documents to which
it is or is to become a party shall have been duly and effectively taken, and
evidence thereof satisfactory to the Lenders shall have been provided to the
Administrative Agent.

 

§8.4.                    Incumbency Certificate. The Administrative Agent shall have
received from the Borrower and each of the Guarantors an incumbency
certificate, dated as of the Effective Date, signed by a duly authorized
officer of the Borrower and each Guarantor, as applicable, and giving the name
and bearing a specimen signature of each individual who shall be authorized: (a) to
sign, in the name and to the benefit of each of the Borrower and the
Guarantors, each of the Loan Documents; (b) with respect to the Borrower,
to make Loan Requests and Conversion Requests; and (c) to give notices and
to take other action on its behalf under the Loan Documents.

 

§8.5.                    Opinion of Counsel. The Administrative Agent shall have
received favorable legal opinions addressed to the Lenders and the
Administrative Agent, dated as of the Effective Date, in form and substance
satisfactory to the Lenders and the Administrative Agent, from (a) Kristin
A. Campbell, Esq., general counsel to the Borrower and the Guarantors and (b) Wilmer
Cutler Pickering Hale and Dorr LLP, special counsel to the Borrower and the
Guarantors.

 

49

 

§8.6.                    Payment of Fees. The Borrower shall have paid to the
Administrative Agent and the other relevant Persons (including the Lenders) all
fees and expenses (including without limitation all reasonable legal fees and
disbursements of the Administrative Agent’s Special Counsel), if any, required
to be paid by the Borrower in connection with this Credit Agreement on or prior
to the Effective Date.

 

§8.7.                    Financial Statements. The Borrower shall have delivered to the
Administrative Agent and the Lenders (i) audited consolidated financial
statements of the Borrower for the three most recent fiscal years as to which
such financial statements are available and (ii) unaudited interim
consolidated financial statements of the Borrower for each quarterly period, if
any, ended subsequent to the date of the latest financial statements delivered
pursuant to clause (i) of this §8.7 as to which such financial statements
are available.

 

§8.8.                    Specified Representations True;
No Default. (a) Each
of the Specified Representations referred to in clause (a) of the
definition thereof shall be true as of the Effective Date (it being agreed
that, notwithstanding anything herein to the contrary, the only representations
and warranties, the accuracy of which shall be a condition to the Effective
Date, shall be the Specified Representations) and (b) no Default or Event
of Default shall have occurred and be continuing; provided that,
notwithstanding anything herein to the contrary, for purposes of this §8.8,
Defaults and Events of Default due to a breach of representations and
warranties shall be limited to a breach of the Specified Representations.

 

§8.9.                    No Default under Material
Indebtedness. No “Event
of Default”, or event or condition which upon notice, lapse of time or both
would, unless cured or waived, become such an “Event of Default”, in respect of
Material Indebtedness of the Borrower and its Subsidiaries (excluding, for the
avoidance of doubt, Corporate Express and its Subsidiaries) shall have occurred
and be continuing as of the Effective Date.

 

§8.10.             Governmental Regulation. Each Lender shall have received such
statements in substance and form reasonably satisfactory to such Lender as such
Lender shall require for the purpose of compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System.

 

§8.11.             USA Patriot Act. Each Lender shall have received at least five (5) days
prior to the Effective Date from the Borrower documentation and other written
information required by regulatory authorities under applicable “know your
customer” and anti-money laundering rules and regulations, including,
without limitation, the USA Patriot Act, as such Lender may reasonably request.

 

§8.12.             Effective Date Certificate. The Administrative Agent shall have
received a certificate, dated the Effective Date and signed by the chief
financial officer or the treasurer of the Borrower, confirming the satisfaction
of the conditions set forth in this §8.

 

50

 

§9.                               CLOSING
DATE CONDITIONS.

 

The obligations of the Lenders to make the initial Loans hereunder
shall be subject to the satisfaction of the following conditions precedent:

 

§9.1.                    Effective Date. The Effective Date shall have occurred.

 

§9.2.                    Offer Consummation. The Offer and the other Transactions, which
are contemplated to be consummated prior to or substantially simultaneously
with the Closing Date, shall be consummated simultaneously with the Closing
Date in accordance with the applicable Offer Documents and applicable law, and
no provision thereof (in the form submitted to and/or approved by the AFM, the
SEC or any other applicable Governmental Authority or otherwise in the final
form thereof, in each case furnished to the Lenders hereunder) shall have been
waived, amended, supplemented or otherwise modified in a manner materially
adverse to the Lenders without the consent of the Initial Lenders. At the
Borrower’s option, it may request the Lenders, and the Lenders agree, to fund
the Loans hereunder one Business Day prior to the anticipated Closing Date; provided
that the proceeds of such Loans shall be held pursuant to escrow or similar
arrangements reasonably satisfactory to the Administrative Agent and shall be
released to the Borrower on the Closing Date upon the satisfaction of the
conditions set forth in this §9 and such Loans shall bear interest hereunder at
the applicable rate therefor from the date of such funding (or failing the
satisfaction of such conditions, the proceeds of such Loans shall be returned
to the Lenders, with interest thereon payable by the Borrower at the rate per
annum applicable to Base Rate Loans hereunder, subject to being readvanced in
accordance with the provisions of this Credit Agreement).

 

§9.3.                    Approvals. All approvals from any Governmental
Authority or other Person necessary or, in the discretion of the Arranger,
advisable in connection with the Corporate Express Acquisition, the financing
contemplated hereby and the continuing operations of the Borrower and its
Subsidiaries (including Corporate Express and its Subsidiaries) shall have been
obtained and be in full force and effect, and all applicable waiting periods
shall have expired without any action being taken or threatened by any
competent authority, in each case above, that could reasonably be expected to
restrain, prevent or otherwise impose material, adverse conditions on the
Corporate Express Acquisition or the financing thereof.

 

§9.4.                    Opinion of Counsel. The Administrative Agent shall have
received favorable legal opinions addressed to the Lenders and the
Administrative Agent, dated as of the Closing Date, in form and substance
satisfactory to the Lenders and the Administrative Agent, from (a) Kristin
A. Campbell, Esq., general counsel to the Borrower and the Guarantors and (b) Wilmer
Cutler Pickering Hale and Dorr LLP, special counsel to the Borrower and the
Guarantors.

 

§9.5.                    Payment of Fees. The Borrower shall have paid to the
Administrative Agent and the other relevant Persons (including the Lenders) all
fees and expenses 

 

51

 

(including
without limitation all reasonable legal fees and disbursements of the
Administrative Agent’s Special Counsel) required to be paid by the Borrower in
connection with this Credit Agreement on or prior to the Closing Date.

 

§9.6.                    Pro Forma Financial Statements. The Borrower shall have delivered to the
Administrative Agent and the Lenders a pro forma
consolidated balance sheet and a trailing twelve month income statement of the
Borrower, after giving effect to the Transactions, prepared as of the end of
the most recent fiscal quarter of the Borrower as to which financial statements
are available.

 

§9.7.                    Specified Representations True;
No Default; No Default under Material Indebtedness. (a) Each of the Specified
Representations shall be true as of the Closing Date (it being agreed that,
notwithstanding anything herein to the contrary, the only representations and
warranties, the accuracy of which shall be a condition to the Closing Date,
shall be the Specified Representations), (b) no Default or Event of
Default shall have occurred and be continuing as of the Closing Date and (c) after
giving pro forma effect to the Transactions, no
“Event of Default”, or event or condition which upon notice, lapse of time or
both would, unless cured or waived, become such an “Event of Default”, in
respect of Material Indebtedness of the Borrower and its Subsidiaries shall
have occurred and be continuing as of the Closing Date; provided that,
notwithstanding anything herein to the contrary, for purposes of this §9.7, (i) Defaults
and Events of Default hereunder due to a breach of representations and
warranties shall be limited to a breach of any of the Specified
Representations, (ii) the absence of any Default or Event of Default
hereunder due to the existence of any Indebtedness, Lien, Investment, asset,
business, transaction or any event or condition of any kind relating to
Corporate Express or any of its Subsidiaries (any such Default or Event of
Default, a “Corporate  Express-Related  Default”) as of the
Closing Date shall not be a condition to the Closing Date; provided that
in no event shall a Corporate Express-Related Default include any such Default
or Event of Default or event or condition of the type described in §12.1(g)(i)(2) hereof
relating to Corporate Express or any of its Subsidiaries, (iii) the
absence of any “Event of Default” or event or condition which upon notice,
lapse of time or both would, unless cured or waived, become such an “Event of
Default” in respect of Material Indebtedness of Corporate Express or any of its
Subsidiaries (any such Event of Default or event or condition, a “Corporate
Express  Material  Indebtedness  Default” and,
together with any Corporate Express-Related Default, each a “Corporate  Express
Default”) as of the Closing Date shall not be a condition to the Closing
Date; provided that in no event shall a Corporate Express Material
Indebtedness Default include any such “Event of Default” or event or condition
of the type described in §12.1(g)(i)(2) hereof relating to Corporate
Express or any of its Subsidiaries and (iv) with respect to the pro forma calculation of the Fixed Charge
Coverage Ratio for purposes of this §9.7 only, such calculation will be made on
the basis of the most recently completed period of four consecutive fiscal
quarters ended prior to the Closing Date for which consolidated financial
statements of the Borrower and consolidated financial statements of Corporate
Express are available (regardless of whether such periods are different for the
Borrower and Corporate Express).

 

52

 

§9.8.                    Amendment to Bridge Credit
Agreement. The
Administrative Agent shall have received a fully executed copy of an amendment
to the Bridge Credit Agreement in a form approved by each of the Lenders.

 

§9.9.                    Closing Date Certificate. The Administrative Agent shall have
received a certificate, dated the Closing Date and signed by the chief
financial officer or the treasurer of the Borrower, confirming the satisfaction
of the conditions set forth in this §9.

 

§10.                        [RESERVED].

 

§11.                        [RESERVED].

 

§12.                        EVENTS
OF DEFAULT; ACCELERATION; ETC.

 

§12.1.             Events of Default and
Acceleration. If any of
the following events (“Events of Default”)
shall occur and be continuing:

 

(a)                                 the
Borrower or any Guarantor shall fail to pay any principal of the Loans when the
same shall become due and payable, whether at the stated date of maturity or
any accelerated date of maturity or at any other date fixed for payment;

 

(b)                                the
Borrower or any Guarantor shall fail to pay any interest on the Loans, the
Commitment Fee, the Administrative Agent Fees, other fees or other sums due
hereunder or under any of the other Loan Documents, within five (5) Business
Days of the date when the same shall become due and payable, whether at the
stated date of maturity or any accelerated date of maturity or at any other
date fixed for payment;

 

(c)                                 the
Borrower (i) shall fail to comply with any of its covenants contained in
§§5.4, 5.5, 5.10, 6 or 7 hereof, or (ii) shall fail to comply with its
covenant contained in §5.6 hereof and such failure shall continue for thirty
(30) days;

 

(d)                                the
Borrower or any of its Subsidiaries shall fail to perform any term, covenant or
agreement contained herein or in any of the other Loan Documents (other than
those specified elsewhere in this §12.1) for thirty (30) days after written
notice of such failure has been given to the Borrower by the Administrative
Agent;

 

(e)                                 any
material representation or warranty of the Borrower or any of its Subsidiaries
in this Credit Agreement or any of the other Loan Documents or in any other
document or instrument delivered pursuant to or in connection with this Credit
Agreement shall prove to have been false in any material respect upon the date
when made or deemed to have been made or repeated;

 

(f)                                   the
Borrower or any of its Subsidiaries shall fail to pay when due, or within any
applicable period of grace, any obligation for borrowed money or credit
received or in respect of any Capitalized Leases or any obligations with
respect to interest rate protection arrangements or exchange rate protection arrangements
which, in the 

 

53

 

aggregate, represents Indebtedness
(calculated, with respect to interest rate protection arrangements and exchange
rate protection arrangements based on the notional principal amount thereof) of
$50,000,000 or more, or fail to observe or perform any material term, covenant
or agreement contained in any agreement by which it is bound, evidencing or
securing borrowed money or credit received or in respect of any Capitalized
Leases or evidencing any interest rate protection arrangement or exchange rate
protection arrangement which in the aggregate represents Indebtedness
(calculated, with respect to interest rate protection arrangements and exchange
rate protection arrangements based on the notional principal amount thereof) of
$50,000,000 or more, and for such period of time as would permit (assuming the
giving of appropriate notice if required) the holder or holders thereof or of
any obligations issued thereunder to accelerate the maturity thereof;

 

(g)                                (i) the
Borrower or any of its Subsidiaries (1) shall make an assignment for the
benefit of creditors, or admit in writing its inability to pay or generally
fail to pay its debts as they mature or become due, or (2) shall petition
or apply for the appointment of a trustee or other custodian, liquidator or
receiver of the Borrower or any of its Subsidiaries or of any substantial part
of the assets of the Borrower or any of its Subsidiaries or shall commence any
case or other proceeding relating to the Borrower or any of its Subsidiaries
under any bankruptcy, reorganization, arrangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law of any jurisdiction, now or
hereafter in effect, or (3) shall take any action to authorize or in
furtherance of any of the foregoing, or (ii) if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against the Borrower or any of its Subsidiaries and shall not have
been dismissed within sixty (60) days, or the Borrower or any of its
Subsidiaries shall indicate its approval thereof, consent thereto or
acquiescence therein;

 

(h)                                a
decree or order is entered appointing any such trustee, custodian, liquidator
or receiver or adjudicating the Borrower or any of its Subsidiaries bankrupt or
insolvent, or approving a petition in any such case or other proceeding, or a
decree or order for relief is entered in respect of the Borrower or any
Subsidiary of the Borrower in an involuntary case under federal bankruptcy laws
as now or hereafter constituted;

 

(i)                                    there
shall remain in force, undischarged, unsatisfied and unstayed, for more than
sixty (60) days, whether or not consecutive, any final judgment against the
Borrower or any of its Subsidiaries that, with other outstanding final
judgments, undischarged, against the Borrower or any of its Subsidiaries,
exceeds in the aggregate $50,000,000;

 

(j)                                    with
respect to any Guaranteed Pension Plan, an ERISA Reportable Event, or a failure
to make a required installment or other payment (within the meaning of §302(f)(1) of
ERISA), shall have occurred and the Required Lenders shall have determined in
their reasonable discretion that such event reasonably could be expected to
result in liability of the Borrower or any of its Subsidiaries to the PBGC or
such Guaranteed Pension Plan in an aggregate amount exceeding $10,000,000 and
such event in the circumstances occurring reasonably could constitute grounds
for the termination of such Guaranteed Pension Plan by the PBGC, for the
appointment by the 

 

54

 

appropriate United States District Court of a
trustee to administer such Guaranteed Pension Plan or for the imposition of a
Lien in favor of such Guaranteed Pension Plan; or a trustee shall have been
appointed by the United States District Court to administer such Plan; or the
PBGC shall have instituted proceedings to terminate such Guaranteed Pension
Plan;

 

(k)                                 the
holders of all or any part of the Subordinated Debt shall accelerate the
maturity of all or any part of the Subordinated Debt or the Subordinated Debt
shall be prepaid, redeemed or repurchased in whole or in part, or an offer to
prepay, redeem or repurchase the Subordinated Debt in whole or in part shall have
been made, in each case in violation of the provisions of this Credit
Agreement;

 

(l)                                    if
any of the Loan Documents shall be canceled, terminated, revoked or rescinded,
in each case otherwise than in accordance with the terms thereof or with the
express prior written agreement, consent or approval of the Lenders, or any
action at law, suit or in equity or other legal proceeding to cancel, revoke or
rescind any of the Loan Documents shall be commenced by or on behalf of the
Borrower or any of its Subsidiaries party thereto or any of their respective
stockholders, or any court or any other governmental or regulatory authority or
agency of competent jurisdiction shall make a determination that, or issue a
judgment, order, decree or ruling to the effect that, any one or more of the
Loan Documents is illegal, invalid or unenforceable in accordance with the
terms thereof; or

 

(m)                              a “Change in Control” shall have occurred (which
for the purposes of this clause (m) shall mean the occurrence of any of
the following events):

 

(i)                                     the acquisition by
any Person (including any syndicate or group deemed to be a “person” under Section 13(d)(3) of
the Securities and Exchange Act of 1934, as amended) of beneficial ownership,
directly or indirectly, through a purchase, merger or other acquisition
transaction or series of transactions, of shares of Capital Stock of the
Borrower entitling such Person to exercise fifty percent (50%) or more of the
total voting power of all shares of Capital Stock of the Borrower entitled to
vote generally in the elections of directors (any shares of voting stock of
which such person or group is the beneficial owner that are not then
outstanding being deemed outstanding for purposes of calculating such
percentage);

 

(ii)                                  any consolidation of
the Borrower with, or merger of the Borrower into, any other Person, any merger
of another Person into the Borrower, or any sale or transfer of all or
substantially all of the assets of the Borrower to another Person (other than a
transfer of assets to one or more Guarantors or a merger (A) which does
not result in any reclassification, conversion, exchange or cancellation of
outstanding shares of Capital Stock of the Borrower or (B) which is
effected solely to change the jurisdiction of incorporation of the Borrower);
or

 

(iii)                               during any consecutive
two-year period, individuals who at the beginning of such period constituted
the Board of Directors of the Borrower 

 

55

 

(together with any new directors whose election
by such Board of Directors or whose nomination for election by the stockholders
of the Borrower was approved by a vote of sixty-six and two-thirds percent
(66-2/3%) of the directors then still in office who were either directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors of the Borrower then in office; or

 

(n)                                any
of (i) the Borrower or any of its Subsidiaries shall fail to make any
payment under any transaction permitted under §6.1(q) hereof when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise), and any such failure shall continue after
the applicable grace period, if any, specified in the documents relating to
such transaction, or (ii) the “Termination Date” or similar date (under
and as defined in any of the documents relating to the transactions permitted
under §6.1(q) hereof) shall have been declared to have occurred, or (iii) any
“Event of Termination” or similar event (under and as defined in any of the
documents relating to the transactions permitted under §6.1(q) hereof)
shall occur and continue after the applicable grace period, if any, specified
in such documents if either, pursuant to such documents, (A) the existence
of such Event of Termination or similar event would automatically cause the
Termination Date or similar date to occur or (B) the existence of such
Event of Termination or similar event would permit the purchaser or lender
under such documents to declare the Termination Date or similar date to have
occurred and such Event of Termination or similar event continues unremedied or
unwaived for a period of more than ninety (90) days after the date that the
Administrative Agent gives notice to the Borrower of such Event of Termination
or similar event;

 

then, and in any such event,
so long as the same may be continuing, the Administrative Agent may, and upon
the request of the Required Lenders shall, by notice in writing to the Borrower
declare all amounts owing with respect to this Credit Agreement and the other
Loan Documents to be, and they shall thereupon forthwith become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrower; provided
that in the event of any Event of Default specified in §§12.1(g) or 12.1(h) hereof,
all such amounts shall become immediately due and payable automatically and
without any requirement of notice from the Administrative Agent or any Lender.

 

In the event that any
Corporate Express Default shall have occurred and be continuing at any time
during the period from and including the Closing Date to and including the Cure
Period Expiration Date (as defined below), the existence of such Corporate
Express Default shall not constitute an Event of Default hereunder if such
Corporate Express Default is remedied on or prior to the Cure Period Expiration
Date for such Corporate Express Default. As used in this paragraph, the “Cure
Period Expiration Date” means (a) with respect to any Corporate Express
Material Indebtedness Default relating to a failure to make any payment on such
Material Indebtedness or any cross-acceleration of such Material Indebtedness,
the earlier of (i) the later of (A) the date which is twenty (20)
days after the Closing Date or (B) the date which is three (3) Business
Days after any such failure or cross-acceleration, as the case may be, and (ii) the

 

56

 

date which is sixty (60)
days after the Closing Date, (b) with respect to any other Corporate
Express Default, the date which is sixty (60) days after the Closing Date or (c) with
respect to any Corporate Express Default referred to in clause (a) or (b) above,
such shorter cure period for such Corporate Express Default (if any) as shall
be applicable thereto under the Bridge Credit Agreement or the Revolving Credit
Agreement.

 

§12.2.             Termination of Commitments. If any one or more of the Events of Default
specified in §§12.1(g) or 12.1(h) hereof shall occur, any unused
portion of the credit hereunder shall forthwith terminate and each of the
Lenders shall be relieved of all further obligations to make Loans to the
Borrower. If any other Event of Default shall have occurred and be continuing,
the Administrative Agent may and, upon the request of the Required Lenders,
shall, by notice to the Borrower, terminate the unused portion of the credit
hereunder, and upon such notice being given such unused portion of the credit
hereunder shall terminate immediately and each of the Lenders shall be relieved
of all further obligations to make Loans. No termination of the credit
hereunder shall relieve the Borrower of any of the Obligations.

 

§12.3.             Remedies. In case any one or more of the Events of
Default shall have occurred and be continuing, and whether or not the Lenders
shall have accelerated the maturity of the Loans pursuant to §12.1 hereof, each
Lender, if owed any amount with respect to the Loans may, with the consent of
the Required Lenders, but not otherwise, proceed to protect and enforce its
rights by suit in equity, action at law or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Credit Agreement and the other Loan Documents or any instrument pursuant
to which the Obligations to such Lender are evidenced, including as permitted
by applicable law the obtaining of the ex parte appointment of a receiver, and,
if such amount shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right of such
Lender. No remedy herein conferred upon any Lender or the Administrative Agent
or the holder of any Note is intended to be exclusive of any other remedy and
each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity
or by statute or any other provision of law.

 

§13.                        SETOFF.

 

Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any of
the Lenders or any of the Subsidiaries of the holding company owning such
Lender to the Borrower and any securities or other property of the Borrower in
the possession of such Lender or such Subsidiary of the holding company owning
such Lender may be applied to or set off by such Lender or such Subsidiary of
the holding company owning such Lender against the payment of Obligations and
any and all other liabilities, direct, or indirect, absolute or contingent, due
or to become due, now existing or hereafter arising, of the Borrower to such
Lender. Each of the Lenders agrees with each other Lender that (a) if an
amount to be set off is to be applied to Indebtedness of the Borrower to such
Lender, other than Indebtedness evidenced by this Credit Agreement owed to such
Lender, such amount 

 

57

 

shall be applied ratably to
such other Indebtedness (except that no amounts shall be applied to documentary
letters of credit) and to the Indebtedness evidenced by this Credit Agreement
owed to such Lender, and (b) if such Lender shall receive from the Borrower,
whether by voluntary payment, exercise of the right of setoff, counterclaim,
cross action, enforcement of the claim evidenced by this Credit Agreement owed
to such Lender by proceedings against the Borrower at law or in equity or by
proof thereof in bankruptcy, reorganization, liquidation, receivership or
similar proceedings, or otherwise, and shall retain and apply to the payment of
the Obligations held by such Lender any amount in excess of its ratable portion
of the payments received by all of the Lenders with respect to the Loans made
by all of the Lenders, such Lender will make such disposition and arrangements
with the other Lenders with respect to such excess, either by way of
distribution, pro tanto assignment of claims,
subrogation or otherwise as shall result in each Lender receiving in respect of
the Loans made by it, its proportionate payment as contemplated by this Credit
Agreement; provided that if all or any part of such excess payment is
thereafter recovered from such Lender, such disposition and arrangements shall
be rescinded and the amount restored to the extent of such recovery, but
without interest.

 

§14.                        THE
ADMINISTRATIVE AGENT.

 

§14.1.             Authorization.

 

(a)                                 Each
of the Lenders hereby irrevocably appoints LCPI to act on its behalf as
administrative agent hereunder and under the other Loan Documents. The
Administrative Agent is authorized to take such action on behalf of each of the
Lenders and to exercise all such powers as are hereunder and under any of the
other Loan Documents and any related documents delegated to the Administrative
Agent, together with such powers as are reasonably incident thereto, provided
that no duties or responsibilities not expressly assumed herein or therein
shall be implied to have been assumed by the Administrative Agent.

 

(b)                                The
relationship between the Administrative Agent and the Lenders is and shall be
that of an independent contractor. The use of the term “Administrative Agent”
herein is for convenience only and is used to describe, as a form of convention,
the independent contractual relationship between the Administrative Agent and
each of the Lenders. Nothing contained in this Credit Agreement or any of the
other Loan Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Administrative Agent and any of the Lenders.

 

(c)                                 As
an independent contractor empowered by the Lenders to exercise certain rights
and perform certain duties and responsibilities hereunder and under the other
Loan Documents, the Administrative Agent is nevertheless a “representative” of
the Lenders, as that term is defined in Article 1 of the Uniform
Commercial Code, for purposes of actions for the benefit of the Lenders with
respect to all collateral security and guaranties contemplated by the Loan
Documents. Such actions include the designation of the Administrative Agent as “secured party”, “mortgagee”, “lienholder” or the
like on all financing statements, motor vehicle titles and other 

 

58

 

documents and instruments, whether recorded
or otherwise, relating to the attachment, perfection, priority or enforcement
of any security interests, mortgages, liens or deeds of trust in collateral
security intended to secure the payment or performance of any of the
Obligations, all for the benefit of the Lenders and the Administrative Agent.

 

§14.2.             Employees and Agents. The Administrative Agent may exercise its
powers and execute its duties by or through employees or agents and shall be
entitled to take, and to rely on, advice of counsel concerning all matters
pertaining to its rights and duties under this Credit Agreement and the other
Loan Documents. The Administrative Agent may utilize the services of such
Persons as the Administrative Agent in its sole discretion may reasonably
determine, and all reasonable fees and expenses of any such Persons shall be
paid by the Borrower.

 

§14.3.             No Liability. Neither the Administrative Agent nor any of
its shareholders, directors, officers or employees nor any other Person
assisting them in their duties nor any agent or employee thereof, shall be
liable to the Lenders for any waiver, consent or approval given or any action
taken, or omitted to be taken, in good faith by it or them hereunder or under
any of the other Loan Documents, or in connection herewith or therewith, or be
responsible for the consequences of any oversight or error of judgment
whatsoever, except that the Administrative Agent or such other Person, as the
case may be, may be liable for losses due to its willful misconduct or gross
negligence. The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability to any Lender for relying upon, any writing,
communication, signature, resolution, representation, notice, consent, certificate,
affidavit, letter, telegram, facsimile, telex, electronic mail message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to the
Borrower), independent accountants and other experts selected by the
Administrative Agent. With respect to the Lenders, the Administrative Agent
shall be fully justified in failing or refusing to take any action under any
Loan Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action; provided that the Administrative Agent shall not
be required to take any action that, in its opinion or the opinion of its
counsel, is contrary to any Loan Document or applicable law; provided  further
that, the Administrative Agent shall not be required to take any action (other
than an action expressly required by this Credit Agreement to be taken by it
under such circumstances) that, in its opinion or the opinion of its counsel,
may expose the Administrative Agent to liability. The Administrative Agent
shall in all cases be fully protected, as against the Lenders, in acting, or in
refraining from acting, under this Credit Agreement or any other Loan Document
in accordance with a request or consent of the Required Lenders (or such
greater number of Lenders as may be expressly required hereby in any instance)
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all the Lenders. Except as expressly set forth herein and in
the other Loan Documents, the Administrative Agent shall have no duty to
disclose, and shall not be liable for the failure 

 

59

 

to
disclose, any information relating to the Borrower or any of their respective
Affiliates that is communicated to or obtained by the Person serving as the
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall be deemed not to have knowledge of any Default or
Event of Default unless and until notice describing such Default or Event of
Default is given to the Administrative Agent by the Borrower or a Lender.

 

THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT
WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY
OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS
FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR
OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER
MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of
its Related Parties (collectively, the “Agent Parties”) have any
liability to the Borrower, any Lender or any other Person for losses, claims,
damages, liabilities or expenses of any kind (whether in tort, contract or
otherwise) arising out of the Borrower’s or the Administrative Agent’s
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party; provided,
however, that in no event shall any Agent Party have any liability to
the Borrower, any Lender or any other Person for indirect, special, incidental,
consequential or punitive damages (as opposed to direct or actual damages).

 

§14.4.             No Representations.

 

§14.4.1.   General. The Administrative Agent shall not be
responsible for the execution or validity or enforceability of this Credit
Agreement, any of the other Loan Documents or any instrument at any time
constituting, or intended to constitute, collateral security for the
Obligations, or for the value of any such collateral security or for the
validity, enforceability or collectibility of any such amounts owing with
respect to this Credit Agreement or for any recitals or statements, warranties
or representations made herein or in any of the other Loan Documents or in any
certificate or instrument hereafter furnished to it by or on behalf of the
Borrower or any of its Subsidiaries, or be bound to ascertain or inquire as to
the performance or observance of any of the terms, conditions, covenants or
agreements herein or in any instrument at any time constituting, or intended to
constitute, collateral security for the Obligations or to inspect any of the
properties, books or records of the Borrower or any of its Subsidiaries. The
Administrative Agent shall not be bound to ascertain whether any notice,
consent, waiver or request delivered to it by the Borrower or any Lender shall
have been duly authorized or is true, accurate and complete. The Administrative
Agent has not made nor does it now make any 

 

60

 

representations
or warranties, express or implied, nor does it assume any liability to the
Lenders, with respect to the creditworthiness or financial conditions of the
Borrower or any of its Subsidiaries. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender, and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Credit Agreement.

 

§14.4.2.   Closing Documentation, etc. For purposes of determining compliance with
the conditions set forth in §8 or §9 hereof, each Lender that has executed this
Credit Agreement shall be deemed to have consented to, approved or accepted, or
to be satisfied with, each document and matter either sent, or made available,
by the Administrative Agent  or the
Arranger to such Lender for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to such Lender, unless an officer of the Administrative Agent  or the Arranger identified to the Lenders as having
responsibility for dealing with this Credit Agreement shall have received
notice from such Lender prior to (i) in the case of §8 hereof, the
Effective Date or (ii) in the case of §9 hereof, the Closing Date,
specifying such Lender’s objection thereto and such objection shall not have
been withdrawn by notice to the Administrative Agent or the Arranger to such
effect on or prior to the Effective Date or the Closing Date, as applicable.

 

§14.5.             Payments.

 

§14.5.1.   Payments to Administrative Agent. A payment by the Borrower to the
Administrative Agent hereunder or any of the other Loan Documents for the
account of any Lender shall constitute a payment to such Lender. The
Administrative Agent agrees promptly to distribute to each Lender such Lender’s
pro rata share of payments received by
the Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.

 

§14.5.2.   Distribution by Administrative
Agent. If in the opinion
of the Administrative Agent the distribution of any amount received by it in
such capacity hereunder or under any of the other Loan Documents might involve
it in liability, it may refrain from making distribution until its right to
make distribution shall have been adjudicated by a court of competent
jurisdiction. If a court of competent jurisdiction shall adjudge that any
amount received and distributed by the Administrative Agent is to be repaid,
each Person to whom any such distribution shall have been made shall either
repay to the Administrative Agent its proportionate share of the amount so
adjudged to be repaid or shall pay over the same in such manner and to such
Persons as shall be determined by such court.

 

§14.5.3.   Delinquent Lenders. Notwithstanding anything to the contrary
contained in this Credit Agreement or any of the other Loan Documents, any
Lender that fails (a) to make available to the Administrative Agent its pro rata share of any Loan or (b) to comply with the
provisions of §13 hereof with respect to making dispositions and arrangements
with the other Lenders, where such Lender’s share of any payment 

 

61

 

received,
whether by setoff or otherwise, is in excess of its pro rata
share of such payments due and payable to all of the Lenders, in each case as,
when and to the full extent required by the provisions of this Credit
Agreement, shall be deemed delinquent (a “Delinquent Lender”) and shall be deemed a Delinquent Lender
until such time as such delinquency is satisfied. A Delinquent Lender shall be
deemed to have assigned any and all payments due to it from the Borrower,
whether on account of outstanding Loans, interest, fees or otherwise, to the
remaining nondelinquent Lenders for application to, and reduction of, their
respective pro rata shares of all outstanding Loans.
The Delinquent Lender hereby authorizes the Administrative Agent to distribute
such payments to the nondelinquent Lenders in proportion to their respective pro rata shares of all outstanding Loans. A Delinquent
Lender shall be deemed to have satisfied in full a delinquency when and if, as
a result of application of the assigned payments to all outstanding Loans of
the nondelinquent Lenders, the Lenders’ respective pro rata
shares of all outstanding Loans have returned to those in effect immediately
prior to such delinquency and without giving effect to the nonpayment causing
such delinquency.

 

§14.6.             Holders of Notes. The Administrative Agent may deem and treat
the payee of any Note as the absolute owner or purchaser thereof for all
purposes hereof until it shall have been furnished in writing with a different
name by such payee or by a subsequent holder, assignee or transferee.

 

§14.7.             Indemnity. To the extent not reimbursed by the
Borrower, the Lenders ratably (based on each Lender’s Commitment Percentage
determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) at the time agree hereby to indemnify and hold harmless the
Administrative Agent and or any of its Related Parties (each an “Indemnified
Party”) from and against any and all claims, actions and suits (whether
groundless or otherwise), losses, damages, costs, expenses (including any
expenses for which such Indemnified Party has not been reimbursed by the
Borrower as required by §15 hereof), and liabilities of every nature and
character arising out of or related to this Credit Agreement or any of the
other Loan Documents or the transactions contemplated or evidenced hereby or
thereby, or such Indemnified Party’s actions taken hereunder or thereunder,
except to the extent that any of the same shall be directly caused by such
Indemnified Party’s willful misconduct, gross negligence or, in the absence of
instruction or concurrence of the Required Lenders, material breach of
contract.

 

§14.8.             Administrative Agent as Lender;
Etc.
In its individual capacity,
LCPI shall have the same obligations and the same rights, powers and privileges
in respect to its Commitment and the Loans made by it, as it would have were it
not also the Administrative Agent. None of the Co-Syndication Agents or the
Arranger shall have any obligation, liability, responsibility or duty under
this Credit Agreement other than as a Lender hereunder.

 

§14.9.             Resignation. The Administrative Agent may resign at any
time by giving seventy five (75) days’ prior written notice thereof to the
Lenders and the Borrower. Upon any such resignation, the Required Lenders shall
have the right to appoint a 

 

62

 

successor
Administrative Agent. Unless a Default or Event of Default shall have occurred
and be continuing, such successor Administrative Agent shall be reasonably
acceptable to the Borrower. Upon the earlier of (i) acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent and (ii) the date on which the Administrative Agent notifies the
Borrower that no qualifying Person has accepted such appointment within seventy
five (75) days after the Administrative Agent shall have provided notice to the
Lenders and the Borrower of its resignation, (A) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and (B) all payments, communications and determinations provided
to be made by, to or through the Administrative Agent shall instead be made, in
the case of clause (i), by or to the successor Administrative Agent and in the
case of clause (ii), by or to each Lender directly, until such time as the
Required Lenders appoint a successor Administrative Agent as provided for above
in this §14.9. Upon the acceptance of a successor’s appointment as
Administrative Agent hereunder, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring
(or retired) Administrative Agent, and the retiring Administrative Agent shall
be discharged from all of its duties and obligations hereunder or under the
other Loan Documents (if not already discharged therefrom as provided above in
this §14.9). The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this §14 and §§15 and 16 hereof shall continue in
effect for the benefit of such retiring Administrative Agent, its sub-agents
and their respective Affiliates, partners, directors, officers, employees,
agents and advisors in respect of any actions taken or omitted to be taken by
any of them while such retiring Administrative Agent was acting as
Administrative Agent.

 

§14.10.      Notification of Defaults and
Events of Default. Each
Lender hereby agrees that, upon learning of the existence of a Default or an
Event of Default, it shall promptly notify the Administrative Agent thereof. The
Administrative Agent hereby agrees that (a) upon receipt of any notice
under this §14.10 it shall promptly notify the other Lenders and the Borrower
of the existence of such Default or Event of Default and (b) upon receipt
of any notice from the Borrower under §5.5 it shall promptly notify
the other Lenders thereof.

 

§14.11.      Administrative Agent May File
Proofs of Claim.

 

(a)                                 In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial, administrative or like proceeding or any
assignment for the benefit of creditors relative to the Borrower or any of its
Subsidiaries, the Administrative Agent (irrespective of whether the principal
of any Loan shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding, under any such assignment or otherwise:

 

63

 

(i)                                    to file and prove a claim for the whole
amount of the principal and interest owing and unpaid in respect of the Loans
and all other Obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims of the
Lenders and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders and the Administrative Agent under the terms of this
Credit Agreement)  allowed in such
proceeding or under any such assignment; and

 

(ii)                                 to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute the same;

 

(b)                                Any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such proceeding or
under any such assignment is hereby authorized by each Lender to make such
payments to the Administrative Agent and, in the event that the Administrative
Agent shall consent to the making of such payments directly to the Lenders,
nevertheless to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel due the Administrative Agent
under the terms of this Credit Agreement, and any other amounts due the
Administrative Agent under the terms of this Credit Agreement.

 

(c)                                 Nothing contained herein shall authorize the
Administrative Agent to consent to or accept or adopt on behalf of any Lender
any plan of reorganization, arrangement, adjustment or composition affecting
the Obligations owed to such Lender or the rights of any Lender or to authorize
the Administrative Agent to vote in respect of the claim of any Lender in any
such proceeding or under any such assignment.

 

§15.                       EXPENSES.

 

The Borrower agrees to pay (a) the Administrative Agent’s and the
Arranger’s reasonable costs of producing and reproducing this Credit Agreement,
the other Loan Documents and the other agreements and instruments mentioned
herein, (b) any taxes (including any interest and penalties in respect
thereto) payable by the Administrative Agent, the Arranger or any of the
Lenders (other than taxes based upon the Administrative Agent’s or any Lender’s
net income or taxes not payable by the Borrower pursuant to the provisions of
this Credit Agreement) on the transactions contemplated by this Credit
Agreement (the Borrower hereby agreeing to indemnify the Administrative Agent,
the Arranger and each Lender with respect thereto), (c) the reasonable
fees, expenses and disbursements of the Administrative Agent’s Special Counsel
or any local counsel to the Administrative Agent incurred in connection with
the preparation, administration or interpretation of the Loan Documents and
other instruments mentioned herein, each closing hereunder, and amendments,
modifications, approvals, consents or waivers hereto or hereunder, (d) the
reasonable fees, expenses and disbursements of the Administrative Agent, the
Arranger or any of their respective Affiliates incurred by the 

 

64

 

Administrative Agent, the
Arranger or such Affiliate in connection with the preparation, administration
or interpretation of the Loan Documents and other instruments mentioned herein,
including all insurance premiums and surveyor, engineering and appraisal
charges and all charges for the use of IntraLinks (or any similar service) in connection
with this Credit Agreement, (e) all reasonable out-of-pocket expenses
(including, without limitation, reasonable attorneys’ fees and costs and
reasonable accounting, appraisal, investment banking and similar professional
fees and charges) incurred by the Administrative Agent or any Lender in
connection with (i) the enforcement of or preservation of rights under any
of the Loan Documents against the Borrower or any of its Subsidiaries or the
administration thereof after the occurrence of an Event of Default (including
all such out-of-pocket expenses incurred during any workout, restructuring or
negotiation) and (ii) any other litigation, proceeding or dispute whether
arising hereunder or otherwise, in any way related to any Lender’s or the
Administrative Agent’s relationship with the Borrower or any of its
Subsidiaries (other than any litigation, proceeding or dispute referred to in
§16 hereof) but only if such Lender or the Administrative Agent is the
prevailing party in such litigation, proceeding or dispute, and (f) all
reasonable fees, expenses and disbursements of the Administrative Agent
incurred in connection with UCC searches. The Borrower shall not pay the fees,
expenses and disbursements incurred by any Lender other than the Administrative
Agent in connection with the review and preparation of this Credit Agreement,
the other Loan Documents and the other agreements and instruments mentioned
herein. The covenants of this §15 shall survive payment or satisfaction of all
other Obligations.

 

§16.                       INDEMNIFICATION.

 

The Borrower agrees to indemnify and hold harmless the Administrative
Agent, the Arranger, the Lenders and their respective Related Parties (each
such Person being called an “Indemnitee”) from and against any and all
claims, actions and suits whether groundless or otherwise, and from and against
any and all liabilities, losses, damages and expenses of every nature and
character arising out of this Credit Agreement or any of the other Loan
Documents or the transactions contemplated hereby, regardless of whether any
Indemnitee is a party thereto, including, without limitation, (a) any
actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Loans, (b) the Borrower or any of its Subsidiaries
entering into or performing this Credit Agreement or any of the other Loan
Documents or (c) with respect to the Borrower and its Subsidiaries and
their respective properties and assets, the violation of any Environmental Law,
the presence, disposal, escape, seepage, leakage, spillage, discharge,
emission, release or threatened release of any Hazardous Substances or any
action, suit, proceeding or investigation brought or threatened with respect to
any Hazardous Substances (including, but not limited to, claims with respect to
wrongful death, personal injury or damage to property), in each case including,
without limitation, the reasonable fees and disbursements of counsel incurred
in connection with any such investigation, litigation or other proceeding, but
excluding liabilities, losses, damages or expenses which are determined by a
court of competent jurisdiction by final order to result from the gross
negligence, willful misconduct or material breach of contract of the Person
seeking indemnification hereunder. In litigation, or the preparation therefor,
the relevant 

 

65

 

Indemnitee shall be entitled
to select its own counsel and, in addition to the foregoing indemnity, the
Borrower agrees to pay promptly the reasonable fees and expenses of such
counsel. No Indemnitee shall be liable for any damages arising from the use by
others of any information or other materials obtained through IntraLinks or
other similar information transmission systems which was disseminated in connection
with this Credit Agreement or the transactions contemplated hereby or for any
damages arising from the use by unintended recipients of any information or
other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Credit Agreement
or the other Loan Documents or the transactions contemplated hereby or thereby,
except, in each case, to the extent such damages are found in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Indemnitee’s gross negligence, willful misconduct or material breach
of contract relating to its treatment or handling of such Intralinks
information, electronic telecommunications or other information transmission
system. If, and to the extent that the obligations of the Borrower under this
§16 are unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment in satisfaction of such obligations which
is permissible under applicable law. The covenants of this §16 shall survive
payment or satisfaction in full of all other Obligations.

 

§17.                       SURVIVAL
OF COVENANTS, ETC.

 

All covenants, agreements, representations and warranties made herein,
in any of the other Loan Documents or in any documents or other papers
delivered by or on behalf of the Borrower or any of its Subsidiaries pursuant
hereto shall be deemed to have been relied upon by the Lenders and the
Administrative Agent, notwithstanding any investigation heretofore or hereafter
made by any of them and notwithstanding that the Administrative Agent or any
Lender may have had notice or knowledge of any Default or Event of Default, and
shall survive the making by the Lenders of any of the Loans, as herein
contemplated, and shall continue in full force and effect so long as any amount
due under this Credit Agreement or the other Loan Documents remains outstanding
or any Lender has any obligation to make any Loans, and for such further time
as may be otherwise expressly specified in this Credit Agreement. All
statements contained in any certificate or other paper delivered to any Lender
or the Administrative Agent at any time by or on behalf of the Borrower or any
of its Subsidiaries pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by the
Borrower or such Subsidiary hereunder.

 

§18.                       ASSIGNMENT
AND PARTICIPATION.

 

§18.1.             General Conditions and Conditions
to Assignment. The
provisions of this Credit Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
the Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except:

 

66

 

(a)                                 any Lender may assign to one or more Eligible
Assignees all or a portion of its interests, rights and obligations under this
Credit Agreement (including all or a portion of its Commitment Percentage and
Commitment and the same portion of the Loans at the time owing to it); provided
that

 

(i)                                    except in the case of an assignment of the
entire remaining amount of the assigning Lender’s Commitment and the Loans at
the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment, determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
a “Trade Date” is specified in the Assignment and Assumption, as of such Trade
Date, shall not be less than $5,000,000  unless each of
the Administrative Agent and, so long as no Event of Default has occurred and
is continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed);

 

(ii)                                 the parties to such assignment shall execute
and deliver to the Administrative Agent, for recording in the Register, an
Assignment and Assumption, substantially in the form of Exhibit D
hereto (an “Assignment and Assumption”), together with any Notes subject to such
assignment, a processing and recordation fee in the amount of $3,500 (provided,
however, that the Administrative Agent may, in its sole discretion,
elect to waive such processing and recordation fee in the case of any
assignment) and, in the case of a Foreign Lender, any documents, certificates
or evidence required to be delivered under §3.3.3 hereof, and the Eligible
Assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire;

 

(iii)                              each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Credit Agreement with respect to the Loans or the
Commitment assigned; and

 

(iv)                             (A) any assignment of a Commitment must
be approved by the Administrative Agent unless the Person that is the proposed
assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee) and (B) unless an Event of
Default has occurred and is continuing, in the case of any assignment to an
Eligible Assignee who would impose costs or burdens on the Borrower under
§§3.3.2, 3.3.3, 3.6, 3.7, 3.8 and/or 3.13 hereof not applicable to the
assigning Lender (or in the aggregate greater than any such costs or burdens
imposed by the assigning Lender), such assignment must be approved by the
Borrower (each such approval, whether referred to in clause (A) or (B),
not to be unreasonably withheld or delayed).

 

Subject to the approvals pursuant to §18.1(a)(iv) hereof, upon
such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Assumption, (i) the
assignee thereunder shall be a party hereto 

 

67

 

and, to the extent provided
in such Assignment and Assumption, have the rights and obligations of a Lender
hereunder, and (ii) the assigning Lender shall, to the extent of its
interest being assigned by such Assignment and Assumption (and, in the case of
an Assignment and Assumption covering all of the assigning Lender’s rights and
obligations under this Credit Agreement, such Lender shall cease to be a party
hereto), be released from its obligations under this Credit Agreement but,
notwithstanding such assignment, shall continue to be entitled to the benefits
of (i) §§3.3.2, 3.7, 3.8 and 3.10 hereof and (ii) §16 hereof, with
respect to facts and circumstances occurring prior to the effective date of
such assignment. Any assignment or transfer by a Lender of rights or
obligations under this Credit Agreement that does not comply with this
paragraph shall be treated for purposes of this Credit Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance
with §18.4 hereof;

 

(b)                                by way of participation in accordance with
the provisions of §18.4 hereof; or

 

(c)                                 by way of pledge or assignment of a security
interest subject to the restrictions of §18.7 hereof (and any other attempted
assignment or transfer by any party hereto shall be null and void).

 

Nothing in this Credit Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent
provided in §18.4 hereof and, to the extent expressly contemplated hereby, the
respective Affiliates, directors, officers, employees, agents and advisors of
each of the Administrative Agent and the Lenders) any legal or equitable right,
remedy or claim under or by reason of this Credit Agreement or any of the other
Loan Documents.

 

§18.2.             Certain Representations and
Warranties; Limitations; Covenants. By executing and delivering an Assignment and Assumption, the parties
to the assignment thereunder confirm to and agree with each other and the other
parties hereto as follows:  (a) other
than the representation and warranty that it is the legal and beneficial owner
of the interest being assigned thereby free and clear of any adverse claim, the
assigning Lender makes no representation or warranty, express or implied, and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Credit Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or the attachment, perfection
or priority of any security interest or mortgage; (b) the assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrower and its Subsidiaries or any other
Person primarily or secondarily liable in respect of any of the Obligations, or
the performance or observance by the Borrower and its Subsidiaries or any other
Person primarily or secondarily liable in respect of any of the Obligations of
any of their obligations under this Credit Agreement or any of the other Loan
Documents or any other instrument or document furnished pursuant hereto or
thereto; (c) such assignee confirms that it has received a 

 

68

 

copy
of this Credit Agreement, together with copies of the most recent financial
statements referred to in §§4.4 and 5.4 hereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption; (d) such assignee
will, independently and without reliance upon the assigning Lender, the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Credit Agreement; (e) such
assignee represents and warrants that it is an Eligible Assignee; (f) such
assignee appoints and authorizes the Administrative Agent to take such action
as agent on its behalf and to exercise such powers under this Credit Agreement
and the other Loan Documents as are delegated to the Administrative Agent by
the terms hereof or thereof, together with such powers as are reasonably
incidental thereto; (g) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Credit Agreement are required to be performed by it as a Lender; and (h) such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Assumption.

 

§18.3.             Register. The Administrative Agent shall maintain a
copy of each Assignment and Assumption delivered to it and a register or
similar list (the “Register”) for the
recordation of the names and addresses of the Lenders and the Commitment
Percentage of, and principal amount of the Loans owing to, the Lenders from
time to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrower and the Lenders at any reasonable time and from time
to time upon reasonable prior notice.

 

§18.4.             Participations. Each Lender may sell participations to one
or more Persons (other than a natural person) (each, a “Participant”) in
all or a portion of such Lender’s rights and obligations under this Credit
Agreement and the other Loan Documents; provided that (a) except in
the case of any such participation sold to a Lender or an Affiliate of a Lender
or an Approved Fund with respect to a Lender, each such participation shall be
in an amount of not less than $5,000,000 or shall be in an amount of such
Lender’s entire remaining Commitment and the Loans at the time owing to it, (b) any
such sale or participation shall not affect the rights and duties of the
selling Lender hereunder to the Borrower, (c) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations and (d) the Borrower, the Administrative Agent, the Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender’s rights and obligations under this Credit Agreement. Any agreement
or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Credit
Agreement and to approve any amendment, modification or waiver of any provision
of this Credit Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver that would reduce the principal
of or the interest rate on any Loans subject to such participation, extend the
term or increase the amount of the 

 

69

 

Commitment
of such Lender as it relates to such Participant, reduce the amount of any fees
to which such Participant is entitled or extend any regularly scheduled payment
date for principal or interest with respect to Loans subject to such
participation. Subject to §18.5 hereof, the Borrower agrees that each
Participant shall be entitled to the benefits of §§3.3.2, 3.7, 3.8 and 3.10
hereof to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to §18.1 hereof. To the extent permitted by law, each
Participant also shall be entitled to the benefits of §13 hereof as though it
were a Lender, provided that such Participant agrees to be subject to
§13 hereof as though it were a Lender.

 

§18.5.             Limitation upon Participant
Rights. A Participant
shall not be entitled to receive any greater payment under §§3.3.2, 3.7 and 3.8
hereof than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower’s prior written
consent. Without limiting the foregoing, a Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of §3.3.2
hereof unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with §3.3.3 hereof as though it were a Lender.

 

§18.6.             Assignee or Participant
Affiliated with the Borrower. If any assignee Lender is an Affiliate of the Borrower, then any such
assignee Lender shall have no right to vote as a Lender hereunder or under any
of the other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Administrative Agent
pursuant to §§12.1 or 12.2 hereof, and the determination of the Required
Lenders shall for all purposes of this Credit Agreement and the other Loan
Documents be made without regard to such assignee Lender’s interest in any of
the Loans. If any Lender sells a participating interest in any of the Loans to
a Participant, and such Participant is the Borrower or an Affiliate of the
Borrower, then such transferor Lender shall promptly notify the Administrative
Agent of the sale of such participation. A transferor Lender shall have no
right to vote as a Lender hereunder or under any of the other Loan Documents
for purposes of granting consents or waivers or for purposes of agreeing to
amendments or modifications to any of the Loan Documents or for purposes of
making requests to the Administrative Agent pursuant to §§12.1 or 12.2 hereof
to the extent that such participation is beneficially owned by the Borrower or
any Affiliate of the Borrower, and the determination of the Required Lenders
shall for all purposes of this Credit Agreement and the other Loan Documents be
made without regard to the interest of such transferor Lender in the Loans to
the extent of such participation.

 

§18.7.             Miscellaneous Assignment
Provisions. Any Lender
may at any time grant a security interest in all or any portion of its rights
under this Credit Agreement to secure obligations of such Lender, including
without limitation (a) any pledge or assignment to secure obligations to
any of the twelve Federal Reserve Banks organized under §4 of the Federal
Reserve Act, 12 U.S.C. §341 and (b) with respect to any Lender that is a
Fund, to any lender or any trustee for, or any other representative of, holders
of 

 

70

 

obligations
owed or securities issued by such Fund as security for such obligations or
securities or any institutional custodian for such Fund or for such lender; provided
that no such grant shall release such Lender from any of its obligations
hereunder or under any of the other Loan Documents, provide any voting rights
hereunder to the secured party thereof, substitute any such secured party for
such Lender as a party hereto or affect any rights or obligations of the
Borrower or the Administrative Agent hereunder. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records
Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.

 

§19.                       NOTICES,
ETC.

 

Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required by this Credit Agreement
shall be in writing and shall be delivered in hand, mailed by United States
registered or certified first class mail, postage prepaid, sent by overnight
courier, or sent by telegraph, telecopy, facsimile or telex and confirmed by
delivery via courier or postal service, addressed as follows:

 

(a)                                 if
to the Borrower, at 500 Staples Drive, Framingham, MA 01701, Attention: Mr. John
J. Mahoney (phone: 508-253-7298) (fax: 508-253-8955) (e-mail:
john.mahoney@staples.com), or at such other address for notice as the Borrower
shall last have furnished in writing to the Person giving the notice, with a
copy to Kristin A. Campbell, Esq., Senior Vice President and General
Counsel, Staples, Inc., 500 Staples Drive, Framingham, MA 01701 (phone:
508-253-8614) (fax: 508-253-8955) (e-mail: kristin.campbell@staples.com);

 

(b)                                if
to the Administrative Agent, (i) for payments and requests for Loans, at
745 Seventh Avenue, New York, New York 10019, Attention: Yvonne Lin-Lu (phone:
212-526-6590) (fax: 212-299-0202) (e-mail: Yvonne.Lin@lehman.com), (ii) for
all other notices, 745 Seventh Avenue, New York, New York 10019, Attention:
Janine Shugan (phone: 212-526 8625) (fax: 917-522-0139) (e-mail:
jshugan@lehman.com), or such other addresses for notice as the Administrative
Agent shall last have furnished in writing to the Person giving the notice; and

 

(c)                                 if
to any Lender, at such Lender’s address set forth on such Lender’s
Administrative Questionnaire, or such other address for notice as such Lender
shall have last furnished in writing to the Person giving the notice.

 

Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight
courier or facsimile to a responsible officer of the party to which it is
directed, at the time of the receipt thereof by 

 

71

 

such officer and (ii) if
sent by registered or certified first-class mail return receipt requested,
postage prepaid, on the third Business Day following the mailing thereof.

 

Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved by the
Administrative Agent, provided that the foregoing shall not apply to
notices to any Lender pursuant to §2 hereof if such Lender has notified the
Administrative Agent that it is incapable of receiving notices under such §2 by
electronic communication. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.

 

Unless the Administrative Agent otherwise prescribes, (i) notices
and other communications sent to an e-mail address shall be deemed received
upon the sender’s receipt of an acknowledgement from the intended recipient
(such as by the “return receipt requested” function, as available, return
e-mail or other written acknowledgement), provided that if such notice
or other communication is not sent during the normal business hours of the
recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next business day for the recipient, and (ii) notices
or communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (i) of notification that
such notice or communication is available and identifying the website address
therefor.

 

Each Lender agrees to notify the Administrative Agent from time to time
to ensure that the Administrative Agent has on record (i) an effective
address, contact name, telephone number, telecopier number and electronic mail
address to which notices and other communications may be sent and (ii) accurate
wire instructions for such Lender.

 

The Administrative Agent and the Lenders shall be entitled to
reasonably rely and act in good faith upon any notices (including telephonic
Loan Requests) purportedly given by or on behalf of the Borrower even if (i) such
notices were not made in a manner specified herein, were incomplete or were not
preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof. The Borrower shall indemnify the Administrative Agent, each Lender and
the directors, officers, employees, agents and advisors of each of them from
all losses, costs, expenses and liabilities resulting from the reliance by such
Person pursuant to this §19 on each notice purportedly given by or on behalf of
the Borrower. All telephonic notices to and other telephonic communications
with the Administrative Agent may be recorded by the Administrative Agent, and
each of the parties hereto hereby consents to such recording.

 

72

 

§20.                       GOVERNING
LAW.

 

THIS CREDIT AGREEMENT AND, EXCEPT
AS OTHERWISE SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS
ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL FOR ALL
PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID STATE
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWER
AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
OR ANY FEDERAL COURT SITTING IN SUCH STATE AND CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE
UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN §19 HEREOF. THE BORROWER
HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE
OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT.

 

§21.                       HEADINGS.

 

The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.

 

§22.                       COUNTERPARTS.

 

This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Credit Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought. Delivery by facsimile by any of
the parties hereto of an executed counterpart hereof or of any amendment or
waiver hereto shall be as effective as an original executed counterpart hereof
or of such amendment or waiver and shall be considered a representation that an
original executed counterpart hereof or such amendment or waiver, as the case
may be, will be delivered.

 

§23.                       ENTIRE
AGREEMENT, ETC.

 

The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in §25 hereof.

 

§24.                       WAIVER
OF JURY TRIAL.

 

EACH PARTY HERETO HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT
TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS
CREDIT AGREEMENT OR ANY OF THE OTHER 

 

73

 

LOAN DOCUMENTS, ANY RIGHTS
OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF WHICH RIGHTS AND
OBLIGATIONS. Except as prohibited by law, the Borrower hereby waives any right
it may have to claim or recover in any litigation referred to in the preceding
sentence any special, exemplary, punitive or consequential damages or any
damages other than, or in addition to, actual damages. The Borrower (a) certifies
that no representative, agent or attorney of any Lender or the Administrative
Agent has represented, expressly or otherwise, that such Lender or the
Administrative Agent would not, in the event of litigation, seek to enforce the
foregoing waivers and (b) acknowledges that the Administrative Agent and
the Lenders have been induced to enter into this Credit Agreement and the other
Loan Documents to which it is a party by, among other things, the waivers and
certifications contained herein.

 

§25.                       CONSENTS,
AMENDMENTS, WAIVERS, ETC.

 

Any consent or approval required or permitted by this Credit Agreement
to be given by the Lenders may be given, and any term of this Credit Agreement,
the other Loan Documents or any other instrument related hereto or mentioned
herein may be amended, and the performance or observance by the Borrower or any
of its Subsidiaries of any terms of this Credit Agreement, the other Loan
Documents or such other instrument or the continuance of any Default or Event
of Default may be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Borrower, the written consent of the Required Lenders and the written
acknowledgment of the Administrative Agent (such acknowledgment not to
be unreasonably withheld or delayed); provided that (a) the
rate of interest on the Loans and the amount of any Commitment Fees may not be
reduced or forgiven, the term of the Loans or the Commitments may not be
extended, the regularly scheduled payment date for principal or interest on the
Loans or any Commitment Fees may not be postponed or extended, and the
Commitment Amounts of a Lender may not be increased, in each case without the
written consent of each Lender directly affected thereby; (b) the
principal amount of any Loans may not be forgiven without the written consent
of each Lender directly affected thereby; (c) any provision hereof
entitling any Lender to receive pro rata
application of payments may not be changed, in each case without the written
consent of each Lender directly affected thereby; (d) this §25 may not be
changed without the written consent of all of the Lenders; (e) the
definition of Required Lenders may not be amended without the written consent
of all of the Lenders; (f) the Administrative Agent may not release any
guaranty for the Obligations (except as provided in §3.14 hereof) without the
written consent of all of the Lenders; and (g) the amount of the
Administrative Agent Fees payable for the account of the Administrative Agent,
and §14 hereof may not be amended without the written consent of the
Administrative Agent. No waiver shall extend to or affect any obligation not
expressly waived or impair any right consequent thereon. No course of dealing
or delay or omission on the part of the Administrative Agent or any Lender in
exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No notice to or demand upon the Borrower shall entitle the
Borrower to other or further notice or demand in similar or other
circumstances.

 

74

 

§26.                       TREATMENT
OF CERTAIN CONFIDENTIAL INFORMATION.

 

§26.1.             Confidentiality. Each of the Lenders and the Administrative
Agent agrees, on behalf of itself and each of its Affiliates, directors,
officers, employees and representatives, to use reasonable precautions to keep
confidential, in accordance with their customary procedures for handling
confidential information of the same nature and in accordance with safe and
sound banking practices, any Confidential Information supplied to it by the
Borrower or any of its Subsidiaries pursuant to this Credit Agreement, provided
that nothing herein shall limit the disclosure of any such information (a) after
such information shall have become public other than through a violation of
this §26 or becomes available to any of the Lenders or the Administrative Agent
on a nonconfidential basis from a source other than the Borrower or any of its
Subsidiaries, (b) to the extent required by statute, rule, regulation or
judicial process, (c) to counsel for any of the Lenders or the
Administrative Agent, (d) to bank examiners, any other regulatory
authority having jurisdiction over any Lender or the Administrative Agent (to
the extent required by such Lender by law or subpoena, but only to the extent
permitted by applicable laws and regulations, including those applying to
classified materials), or to auditors or accountants (provided that such
auditor or accountant has agreed to be bound by this §26), (e) to the
Administrative Agent, any Lender or, solely in connection with this Credit
Agreement and the transactions contemplated hereby, any Financial Affiliate (provided
that such Financial Affiliate has agreed in a writing enforceable by the
Borrower to be bound by this §26), (f) in connection with any litigation
to which any one or more of the Lenders, the Administrative Agent or any
Financial Affiliate is a party, or in connection with the enforcement of rights
or remedies hereunder or under any other Loan Document, (g) solely in
connection with this Credit Agreement and the transactions contemplated hereby,
to a Lender Affiliate or a Subsidiary or Affiliate of the Administrative Agent
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (h) to any assignee or participant (or
prospective assignee or participant) or any actual or prospective counterparty
(or its advisors) to any swap or derivative transactions referenced to credit
or other risks or events arising under this Credit Agreement or any other Loan
Document so long as such assignee, participant or counterparty, as the case may
be, agrees in a writing enforceable by the Borrower to be bound by the
provisions of this §26 or (i) with the consent of the Borrower.

 

§26.2.             Prior Notification. Unless specifically prohibited by
applicable law or court order, each of the Lenders and the Administrative Agent
shall, prior to disclosure thereof, notify the Borrower of any request for
disclosure of any such non-public information by any governmental agency or
representative thereof (other than any such request in connection with an
examination of the financial condition of such Lender by such governmental
agency) or pursuant to legal process including, without limitation, any
disclosure under §26.1(b), (d) or (f) hereof. In addition to, and
without limiting the foregoing, each of the Lenders and the Administrative
Agent shall permit the Borrower to intervene in any relevant proceedings to
protect its interests in the non-public information and shall provide
reasonable cooperation to the Borrower, at the Borrower’s expense, in 

 

75

 

seeking
to obtain such protection. Each of the Lenders and the Administrative Agent
further agrees that if the Borrower is not successful in precluding the court
or other legal body from requiring the disclosure of the non-public
information, such Lender or the Administrative Agent, as the case may be, will
furnish only that portion of the non-public information which it in good faith
reasonably considers to be legally required and, at the request and expense of
the Borrower, will exercise all reasonable efforts to obtain reliable
assurances that confidential treatment will be accorded the non-public
information.

 

§26.3.             Other. In no event shall any Lender or the
Administrative Agent be obligated or required to return any materials furnished
to it or any Financial Affiliate by the Borrower or any of its Subsidiaries. The
obligations of each Lender under this §26 shall supersede and replace the
obligations of such Lender under any confidentiality letter in respect of this
financing signed and delivered by such Lender to the Borrower prior to the date
hereof and shall be binding upon any assignee of, or purchaser of any
participation in, any interest in any of the Loans from any Lender.

 

§27.                       SEVERABILITY.

 

The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or
in part in any jurisdiction, then such invalidity or unenforceability shall
affect only such clause or provision, or part thereof, in such jurisdiction,
and shall not in any manner affect such clause or provision in any other
jurisdiction, or any other clause or provision of this Credit Agreement in any
jurisdiction.

 

§28.                       USA
PATRIOT Act Notice.

 

Each Lender that is subject to the USA Patriot Act and the
Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies the Borrower that pursuant to the requirements of the USA Patriot Act,
it is required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower and
other information that will allow such Lender or the Administrative Agent, as
applicable, to identify such Borrower in accordance with the USA Patriot Act.

 

§29.                       NO ADVISORY OR FIDUCIARY RESPONSIBILITY.

 

In connection with all aspects of each transaction contemplated hereby,
the Borrower acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (i) the credit facility provided for hereunder and
any related arranging or other services in connection therewith (including in
connection with any amendment, waiver or other modification hereof or of any
other Loan Document) are an arm’s-length commercial transaction between the
Borrower and its Affiliates, on the one hand, and the Administrative Agent, the
Arranger and the Lenders, on the other hand, and the Borrower is capable of
evaluating and understanding and understands and accepts the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan
Documents 

 

76

 

(including any amendment,
waiver or other modification hereof or thereof); (ii) in connection with
the process leading to such transaction, the Administrative Agent, the Arranger
and the Lenders each is and has been acting solely as a principal and is not
the financial advisor, agent or fiduciary, for the Borrower or any of its
Affiliates, stockholders, creditors or employees or any other Person; (iii) none
of the Administrative Agent, the Arranger nor any Lender has assumed or will
assume an advisory, agency or fiduciary responsibility in favor of the Borrower
with respect to any of the transactions contemplated hereby or the process
leading thereto, including with respect to any amendment, waiver or other
modification hereof or of any other Loan Document (irrespective of whether the
Administrative Agent, the Arranger or any Lender has advised or is currently
advising the Borrower or its Affiliates on other matters) and none of the
Administrative Agent, the Arranger nor any Lender has any obligation to the
Borrower or its Affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth herein and in the other Loan
Documents; (iv) the Administrative Agent, the Arranger, the Lenders and
their respective Affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of the Borrower and its
Affiliates, and none of the Administrative Agent, the Arranger nor any Lender
has any obligation to disclose any of such interests by virtue of any advisory,
agency or fiduciary relationship; and (v) none of the Administrative
Agent, the Arranger nor any Lender has provided or will provide any legal,
accounting, regulatory or tax advice with respect to any of the transactions
contemplated hereby (including any amendment, waiver or other modification
hereof or of any other Loan Document) and the Borrower has consulted its own
legal, accounting, regulatory and tax advisors to the extent it has deemed
appropriate. The Borrower hereby waives and releases, to the fullest extent
permitted by law, any claims that it may have against the Administrative Agent,
the Arranger or any Lender with respect to any breach or alleged breach of
agency or fiduciary duty.

 

§30.                       COLLATERAL.

 

Each of the Lenders represents to the Administrative Agent and each of
the other Lenders that it in good faith is not relying upon any Margin Stock as
collateral (whether direct or indirect security) in the extension or
maintenance of the credit provided for in this Credit Agreement.

 

[signature pages follow]

 

77

 

IN WITNESS WHEREOF, the undersigned have duly executed this
Credit Agreement as of the date first set forth above.

 

	
   

  	
  STAPLES, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Ronald L. Sargent

  
	
   

  	
  Name:
  Ronald L. Sargent

  
	
   

  	
  Title:
  Chairman and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  John J. Mahoney

  
	
   

  	
  Name:
  John J. Mahoney

  
	
   

  	
  Title:
  Vice Chairman and Chief Financial Officer

  

 

 

	
   

  	
  LEHMAN COMMERCIAL PAPER INC., as

  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Adrian De Lagarde

  
	
   

  	
  Name:
  Adrian De Lagarde

  
	
   

  	
  Title:
  Authorized Signatory

  

 

 

	
   

  	
  LENDERS

  
	
   

  	
   

  
	
   

  	
  LEHMAN
  BROTHERS COMMERCIAL BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Brian Halbeisen

  
	
   

  	
  Name:
  Brian Halbeisen

  
	
   

  	
  Title:
  Credit Officer

  

 

 

	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as
  Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Thomas J. Kane

  
	
   

  	
  Name:
  Thomas J. Kane

  
	
   

  	
  Title:
  SVP

  

 

 

	
   

  	
  HSBC BANK USA, NATIONAL

  ASSOCIATION,

  
	
   

  	
  as
  Lender and Co-Syndication Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
  Robert J. Devir

  
	
   

  	
  Name: Robert J. Devir

  
	
   

  	
  Title: Managing
  Director

  

 

 

EXHIBIT A

 

FORM OF LOAN REQUEST

 

STAPLES, INC.

500 Staples Drive

Framingham,
Massachusetts 01702

 

[                  ,
200  ]

 

Lehman Commercial Paper
Inc.,

as Administrative Agent

745 Seventh Avenue

New York, New York 10019

Attention:  Yvonne Lin-Lu

 

Ladies and Gentlemen:

 

Reference is hereby made to that certain
Credit Agreement, dated as of July 1, 2008 (as the same may be amended and
in effect from time to time, the “Credit Agreement”), among Staples, Inc.
(the “Borrower”), the lending institutions which are or may become
parties thereto from time to time (collectively, the “Lenders”), Lehman
Commercial Paper Inc., as administrative agent for the Lenders (the “Administrative
Agent”), Bank of America, N.A. and HSBC Bank USA, National Association, as
co-syndication agents. Capitalized terms which are used herein without
definition and which are defined in the Credit Agreement shall have the same
meanings herein as in the Credit Agreement.

 

Pursuant to §2.2 of the Credit Agreement, we
hereby request that a Loan consisting of [a Base Rate Loan in the principal
amount of
$                    ]
[a Eurocurrency Rate Loan in the principal amount of
$                    
with an Interest Period of
              ]
be made on                     
    , 200   . We understand that this
request is irrevocable and binding on us and obligates us to accept the
requested Loan on such date.

 

We hereby certify that:

 

(a) we will use the proceeds of the
requested Loan in accordance with the provisions of the Credit Agreement; and

 

(b)  each of the Specified
Representations is true at and as of the Closing Date and (ii) no Default
or Event of Default has occurred and is continuing (but, in each case, subject
to the applicable provisos set forth in §9.7 of the Credit Agreement).

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  STAPLES,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  

 

2

 

EXHIBIT B

 

FORM OF GUARANTY

 

This GUARANTY, dated
as of July [    ], 2008 (this “Guaranty”), by STAPLES THE OFFICE SUPERSTORE, LLC,
a Delaware limited liability company, STAPLES THE OFFICE
SUPERSTORE EAST, INC., a
Delaware corporation, STAPLES CONTRACT &
COMMERCIAL, INC., a
Delaware corporation, [,][and] STAPLES THE OFFICE
SUPERSTORE, LIMITED PARTNERSHIP,
a Massachusetts limited partnership [AND OTHER GUARANTORS,  IF ANY, TO BE SPECIFIED]
(collectively, the “Guarantors”), is in favor of (i) Lehman
Commercial Paper Inc., as administrative agent (in such capacity, the “Administrative
Agent”) for itself and the lending institutions (collectively, the “Lenders”)
which are or may become parties to that certain Credit Agreement, dated as of July 1,
2008, (as amended and in effect from time to time, the “Credit Agreement”),
among Staples, Inc., a Delaware corporation (the “Borrower”), the
Lenders, Bank of America, N.A. and HSBC Bank USA, National Association as
Co-Syndication Agents, and the Administrative Agent and (ii) each of the
Lenders.

 

WHEREAS, the
Borrower and the Guarantors are members of a group of related entities, the
success of any one of which is dependent in part on the success of the other
members of such group;

 

WHEREAS, each of the
Guarantors expects to receive substantial direct and indirect benefits from the
extensions of credit to the Borrower by the Lenders pursuant to the Credit
Agreement (which benefits are hereby acknowledged);

 

WHEREAS, it is a
condition precedent to the effectiveness of the Credit Agreement and the
Lenders’ obligations to make any loans to the Borrower under the Credit
Agreement that the Guarantors execute and deliver to the Administrative Agent,
for the benefit of the Lenders and the Administrative Agent, a guaranty
substantially in the form hereof; and

 

WHEREAS, the
Guarantors wish to guaranty the Borrower’s obligations to the Lenders and the
Administrative Agent under or in respect of the Credit Agreement as provided
herein:

 

NOW THEREFORE, the
Guarantors hereby agree with the Lenders and the Administrative Agent as
follows:

 

§1. Definitions.
The term “Obligations” and all other capitalized terms
used herein without definition shall have the respective meanings provided
therefor in the Credit Agreement.

 

§2. Guaranty
of Payment and Performance. Each of the Guarantors
hereby jointly and severally guarantees to the Lenders and the Administrative
Agent the full and punctual payment when due (whether at stated maturity, by
required pre-payment, by acceleration or otherwise), as well as the
performance, of all of the Obligations including all such which would become
due but for the operation of the automatic stay pursuant to §362(a) of
Title 11, United States Code (the “Federal Bankruptcy Code”) and
the operation of §§502(b) and 506(b) of the Federal Bankruptcy
Code. This Guaranty is an absolute, unconditional and continuing guaranty of
the full and punctual payment and performance of all of the Obligations and not
of their collectibility

 

 

only and is in no way conditioned upon any
requirement that the Administrative Agent or any Lender first attempt to
collect any of the Obligations from the Borrower or resort to any collateral
security or other means of obtaining payment. Should the Borrower default in
the payment or performance of any of the Obligations, the obligations of each
of the Guarantors hereunder with respect to such Obligations in default shall,
upon demand by the Administrative Agent, become immediately due and payable to
the Administrative Agent, for the benefit of the Lenders and the Administrative
Agent, without demand or notice of any nature, all of which are expressly
waived by each of the Guarantors. Payments by the Guarantors hereunder may be
required by the Administrative Agent on any number of occasions. All payments
by the Guarantors hereunder shall be made to the Administrative Agent, in the
manner and at the place of payment specified therefor in the Credit Agreement,
for the account of the Lenders and the Administrative Agent. Anything contained
herein to the contrary notwithstanding, the obligations of the Guarantors
hereunder at any time shall be limited to an aggregate amount equal to the
largest amount that would not render its obligations hereunder subject to
avoidance as a fraudulent transfer or conveyance under §548 of the Federal
Bankruptcy Code or any comparable provisions of any similar federal or state
law.

 

§3. Guarantors’
Agreement to Pay Enforcement Costs. Each of the
Guarantors further agrees, as the principal obligor and not as a guarantor
only, to pay to the Administrative Agent, on demand, all costs and expenses
(including court costs and legal expenses) incurred or expended by the
Administrative Agent or any Lender in connection with the Obligations, this
Guaranty and the enforcement thereof, together with interest on amounts
recoverable under this §3 from the time when such amounts become due until
payment, whether before or after judgment, at the rate of interest for overdue
principal set forth in the Credit Agreement, provided that if such
interest exceeds the maximum amount permitted to be paid under applicable law,
then such interest shall be reduced to such maximum permitted amount.

 

§4. Waivers
by Guarantors; Lender’s Freedom to Act. The
Guarantors agree that the Obligations will be paid and performed strictly in
accordance with their respective terms, regardless of any law, regulation or
order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Administrative Agent or any Lender with respect
thereto. Each of the Guarantors waives promptness, diligence, presentment,
demand, protest, notice of acceptance, notice of any Obligations incurred and
all other notices of any kind, all defenses which may be available by virtue of
any valuation, stay, moratorium law or other similar law now or hereafter in
effect, any right to require the marshalling of assets of the Borrower or any
other entity or other person primarily or secondarily liable with respect to
any of the Obligations, and all suretyship defenses generally. Without limiting
the generality of the foregoing, each of the Guarantors agrees to the
provisions of any instrument evidencing, securing or otherwise executed in
connection with any Obligation and agrees that the obligations of such
Guarantor hereunder shall not be released or discharged, in whole or in part,
or otherwise affected by (i) the failure of the Administrative Agent or
any Lender to assert any claim or demand or to enforce any right or remedy
against the Borrower or any other entity or other person primarily or
secondarily liable with respect to any of the Obligations; (ii) any
extensions, compromise, refinancing, consolidation or renewals of any Obligation;
(iii) any change in the time, place or manner of payment of any of the
Obligations or any rescissions, waivers, compromise, refinancing, consolidation
or other amendments or modifications of any of the terms or provisions of the
Credit Agreement, the Notes, the other Loan Documents or any other 

 

2

 

agreement evidencing, securing or otherwise
executed in connection with any of the Obligations, (iv) the addition,
substitution or release of any entity or other person primarily or secondarily
liable for any Obligation; (v) the adequacy of any rights which the
Administrative Agent or any Lender may have against any collateral security or
other means of obtaining repayment of any of the Obligations; (vi) the
impairment of any collateral securing any of the Obligations, including without
limitation the failure to perfect or preserve any rights which the
Administrative Agent or any Lender might have in such collateral security or
the substitution, exchange, surrender, release, loss or destruction of any such
collateral security; or (vii) any other act or omission which might in any
manner or to any extent vary the risk of such Guarantor or otherwise operate as
a release or discharge of such Guarantor, all of which may be done without
notice to such Guarantor. To the fullest extent permitted by law, each of the
Guarantors hereby expressly waives any and all rights or defenses arising by
reason of (A) any “one action” or “anti-deficiency” law which would otherwise
prevent the Administrative Agent or any Lender from bringing any action,
including any claim for a deficiency, or exercising any other right or remedy
(including any right of set-off), against such Guarantor before or after the
Administrative Agent’s or such Lender’s commencement or completion of any
foreclosure action, whether judicially, by exercise of power of sale or
otherwise, or (B) any other law which in any other way would otherwise
require any election of remedies by the Administrative Agent or any Lender.

 

§5. Unenforceability
of Obligations Against Borrower. If for any reason
the Borrower has no legal existence or is under no legal obligation to
discharge any of the Obligations, or if any of the Obligations have become
irrecoverable from the Borrower by reason of the Borrower’s insolvency,
bankruptcy or reorganization or by other operation of law or for any other
reason, this Guaranty shall nevertheless be binding on each of the Guarantors
to the same extent as if such Guarantor at all times had been the principal
obligor on all such Obligations. In the event that acceleration of the time for
payment of any of the Obligations is stayed upon the insolvency, bankruptcy or
reorganization of the Borrower, or for any other reason, all such amounts otherwise
subject to acceleration under the terms of the Credit Agreement, the Notes, the
other Loan Documents or any other agreement evidencing, securing or otherwise
executed in connection with any Obligation shall be immediately due and payable
by the Guarantors.

 

§6. Subrogation;
Subordination.

 

§6.1.                    Waiver of
Rights Against Borrower. Until the final payment and performance in
full of all of the Obligations, the Guarantors shall not exercise and hereby
waive any rights against the Borrower arising as a result of payment by the
Guarantors hereunder, by way of subrogation, reimbursement, restitution,
contribution or otherwise, and will not prove any claim in competition with the
Administrative Agent or any Lender in respect of any payment hereunder in any bankruptcy,
insolvency or reorganization case or proceedings of any nature; the Guarantors
will not claim any setoff, recoupment or counterclaim against the Borrower in
respect of any liability of the Guarantors to the Borrower; and the Guarantors
waive any benefit of and any right to participate in any collateral security
which may be held by the Administrative Agent or any Lender. If any amounts are
paid to any Guarantor in violation of the foregoing limitation, then such
amounts shall be held in trust for the benefit of the Administrative Agent and
the Lenders and shall forthwith be paid to the Administrative Agent for the
benefit of the Lenders and 

 

3

 

the Administrative Agent, on account of the Obligations without
affecting in any manner the liability of the Guarantors under the other
provisions of this Guaranty.

 

§6.2.                    Subordination.
The payment of any amounts due with respect to any indebtedness of the
Borrower for money borrowed or credit received now or hereafter owed to the
Guarantors is hereby subordinated to the prior payment in full of all of the
Obligations. Each of the Guarantors agrees that, after the occurrence of any
default in the payment or performance of any of the Obligations, such Guarantor
will not demand, sue for or otherwise attempt to collect any such indebtedness
of the Borrower to such Guarantor until all of the Obligations shall have been
indefeasibly paid in full. If, notwithstanding the foregoing sentence, the
Guarantors shall collect, enforce or receive any amounts in respect of such
indebtedness while any Obligations are still outstanding, such amounts shall be
collected, enforced and received by such Guarantor as trustee for the Lenders
and the Administrative Agent and be paid over to the Administrative Agent, for
the benefit of the Lenders and the Administrative Agent, on account of the
Obligations without affecting in any manner the liability of the Guarantors
under the other provisions of this Guaranty.

 

§6.3.                    Provisions
Supplemental. The provisions of this §6 shall be supplemental to and
not in derogation of any rights and remedies of the Lenders and the
Administrative Agent under any separate subordination agreement which the
Administrative Agent may at any time and from time to time enter into with the
Guarantors for the benefit of the Lenders and the Administrative Agent.

 

§7. Setoff.
Regardless of the adequacy of any collateral, during the continuance of any
Event of Default, any deposits or other sums credited by or due from the
Administrative Agent, any of the Lenders or any of the Subsidiaries of the
holding company owning the Administrative Agent or any Lender to any Guarantor
and any securities or other property of such Guarantor in the possession of the
Administrative Agent, such Lender or such Subsidiary of the holding company
owning the Administrative Agent may be applied to or set off by the
Administrative Agent, such Lender or such Subsidiary of the holding company
owning the Administrative Agent or such Lender against the obligations of such
Guarantor under this Guaranty, whether or not the Administrative Agent or such
Lender shall have made any demand under this Guaranty.

 

§8. Contribution.
To the extent any of the Guarantors makes a payment
hereunder in excess of the aggregate amount of the benefit received by such
Person in respect of the extensions of credit under the Credit Agreement (the “Benefit
Amount”), then such Person, after the payment in full in cash of all of the
Obligations shall be entitled to recover from each such Person such excess
payment, pro rata in accordance with the ratio of the Benefit Amount received
by such other Person to the total Benefit Amounts received by each of the
Guarantors, and the right to such recovery shall be deemed to be an asset and
property of such Person so funding; provided that all such rights to
recovery shall be subordinate and junior in right of payment to the final and
indefeasible repayment in full in cash of all of the Obligations.

 

§9. Further
Assurances. Each of the Guarantors agrees that it
will from time to time, at the request of the Administrative Agent, do all such
things and execute all such documents as the Administrative Agent may consider
necessary or desirable to give full effect to this Guaranty and 

 

4

 

to perfect and preserve the rights and powers
of the Lenders and the Administrative Agent hereunder. Each of the Guarantors
acknowledges and confirms that such Guarantor itself has established its own
adequate means of obtaining from the Borrower on a continuing basis all
information desired by such Guarantor concerning the financial condition of the
Borrower and that such Guarantor will look to the Borrower and not to the
Administrative Agent or any Lender in order for such Guarantor to keep
adequately informed of changes in the Borrower’s financial condition.

 

§10. Termination;
Reinstatement. This Guaranty shall remain in full
force and effect until the Administrative Agent is given written notice of the
Guarantors’ intention to discontinue this Guaranty, notwithstanding any
intermediate or temporary payment or settlement of the whole or any part of the
Obligations. No such notice shall be effective unless received and acknowledged
by an officer of the Administrative Agent, on behalf of all of the Lenders, at
the address of the Administrative Agent for notices set forth in §19 of the
Credit Agreement. No such notice shall affect any rights of the Administrative
Agent or any Lender hereunder, including without limitation the rights set
forth in §§4 and 6 hereof, with respect to any Obligations incurred or
accrued prior to the receipt of such notice or any Obligations incurred or
accrued pursuant to any contract or commitment in existence prior to such receipt.
This Guaranty shall continue to be effective or be reinstated, notwithstanding
any such notice, if at any time any payment made or value received with respect
to any Obligation is rescinded or must otherwise be returned by the
Administrative Agent or any Lender upon the insolvency, bankruptcy or
reorganization of the Borrower, or otherwise, all as though such payment had
not been made or value received.

 

§11. Successors
and Assigns. This Guaranty shall be binding upon
each of the Guarantors, its successors and assigns, and shall inure to the
benefit of the Administrative Agent and the Lenders and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing sentence, each Lender may assign or otherwise transfer the Credit
Agreement, its Notes, the other Loan Documents or any other agreement or note
held by it evidencing, securing or otherwise executed in connection with the
Obligations, or sell participations in any interest therein, to any other
entity or other person, and such other entity or other person shall thereupon
become vested, to the extent set forth in the agreement evidencing such
assignment, transfer or participation, with all the rights in respect thereof
granted to such Lender herein, all in accordance with §18 of the Credit
Agreement. The Guarantors may not assign any of their obligations hereunder.

 

§12. Amendments
and Waivers. No amendment or waiver of any
provision of this Guaranty nor consent to any departure by the Guarantors
therefrom shall be effective unless the same shall be in writing and signed by
the Administrative Agent with the consent of all of the Lenders. No failure on
the part of the Administrative Agent or any Lender to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any right hereunder preclude any other or
further exercise thereof or the exercise of any other right.

 

§13. Notices.
All notices and other communications called for
hereunder shall be made in writing and, unless otherwise specifically provided
herein, shall be deemed to have been duly made or given when delivered by hand
or mailed first class, postage prepaid, or, in the case 

 

5

 

of notice sent by telegraph, telecopy,
facsimile or telex, when transmitted, answer back received, addressed as
follows:  if to the Guarantors, at the
address set forth beneath their respective signatures hereto, and if to the Administrative
Agent, at the address for notices to the Administrative Agent set forth in §19
of the Credit Agreement, or at such address as either party may designate in
writing to the other.

 

§14. Governing
Law; Consent to Jurisdiction. THE GUARANTY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW).
Each of the Guarantors agrees that any suit for the enforcement of this
Guaranty may be brought in the courts of the State of New York or any federal
court sitting therein and consents to the nonexclusive jurisdiction of such
court and to service of process in any such suit being made upon such Guarantor
by mail at the address specified by reference in §13 hereof. Each of the
Guarantors hereby waives any objection that it may now or hereafter have to the
venue of any such suit or any such court or that such suit was brought in an
inconvenient court.

 

§15. Waiver
of Jury Trial. EACH OF THE
GUARANTORS, THE LENDERS AND THE ADMINISTRATIVE AGENT HEREBY WAIVES ITS RIGHT TO
A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE
PERFORMANCE OF ANY OF SUCH RIGHTS OR OBLIGATIONS. Except as
prohibited by law, each of the Guarantors hereby waives any right which it may
have to claim or recover in any litigation referred to in the preceding
sentence any special, exemplary, punitive or consequential damages or any
damages other than, or in addition to, actual damages. Each of the Guarantors (a) certifies
that neither the Administrative Agent or any Lender nor any representative,
agent or attorney of the Administrative Agent or any Lender has represented,
expressly or otherwise, that the Administrative Agent or any Lender would not,
in the event of litigation, seek to enforce the foregoing waivers and (b) acknowledges
that, in entering into the Credit Agreement and the other Loan Documents to
which the Administrative Agent or any Lender is a party, the Administrative
Agent and the Lenders are relying upon, among other things, the waivers and
certifications contained in this §15.

 

§16. Miscellaneous.
This Guaranty constitutes the entire agreement of each
of the Guarantors with respect to the matters set forth herein. The rights and
remedies herein provided are cumulative and not exclusive of any remedies
provided by law or any other agreement, and this Guaranty shall be in addition
to any other guaranty of or collateral security for any of the Obligations. The
invalidity or unenforceability of any one or more sections of this Guaranty
shall not affect the validity or enforceability of its remaining provisions. Captions
are for the ease of reference only and shall not affect the meaning of the
relevant provisions. The meanings of all defined terms used in this Guaranty
shall be equally applicable to the singular and plural forms of the terms
defined.

 

[remainder
of this page intentionally left blank]

 

6

 

IN WITNESS WHEREOF,
each of the Guarantors has caused this Guaranty to be executed and delivered as
of the date first above written.

 

	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  500 Staples Drive

  
	
   

  	
   

  	
  Framingham, MA 01702

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
  508-253-5485

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE EAST,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  500 Staples Drive

  
	
   

  	
   

  	
  Framingham, MA 01702

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
  508-253-5485

  
				

 

7

 

	
   

  	
  STAPLES
  CONTRACT & COMMERCIAL,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  500 Staples Drive

  
	
   

  	
   

  	
  Framingham, MA 01702

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
  508-253-5485

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE,

  LIMITED PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  500 Staples Drive

  
	
   

  	
   

  	
  Framingham, MA 01702

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
  508-253-5485

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [OTHER
  GUARANTORS, IF ANY]

  
				

 

8

 

EXHIBIT C

 

FORM OF

COMPLIANCE CERTIFICATE

 

[Date]

 

To the Lenders Party to
the

Credit Agreement Referred
to Below

c/o Lehman Commercial
Paper Inc.,

as Administrative Agent

745 Seventh Avenue

New York, New York 10019

Attention: Janine Shugan

 

Ladies and Gentlemen:

 

Reference is made to the Credit Agreement,
dated as of July 1, 2008 (as amended and in effect from time to time, the “Credit
Agreement”), by and among Staples, Inc. (the “Borrower”), the
lending institutions which are or may become parties thereto from time to time
(collectively, the “Lenders”), Lehman Commercial Paper Inc., as
administrative agent for the Lenders (the “Administrative Agent”), and
Bank of America, N.A. and HSBC Bank USA, National Association, as
Co-Syndication Agents. Capitalized terms used herein without definition and
which are defined in the Credit Agreement shall have the respective meanings
assigned to such terms in the Credit Agreement.

 

Pursuant to [§5.4(a)] [§5.4(b)] of the Credit
Agreement, the chief financial officer or treasurer of the Borrower, on behalf
of the Borrower, hereby certifies to each of you as follows:  (a) to the best of the Borrower’s
knowledge, the financial statements delivered herewith fairly present the
financial position of the Borrower and its Subsidiaries on the date thereof and
were prepared in accordance with GAAP applied on a basis consistent with prior
periods (except, in the case of quarterly statements, for provisions for
footnotes and subject to year end adjustments and, in all cases, except as
disclosed therein); (b) to the best of the Borrower’s knowledge, the
information furnished in the calculations attached hereto was true and correct
as of the last day of the fiscal [year] [quarter] next preceding the date of
this certificate; and (c) a review of the activities, transactions and
condition (financial or otherwise) of the Borrower during such fiscal period
and the terms of the Credit Agreement and the other Loan Documents has been
made under the supervision of the undersigned with a view to determining
whether during such fiscal period the Borrower performed and observed all its
Obligations under the Loan Documents and, to the best of the Borrower’s
knowledge, as of the date of this certificate, there exists no Default or Event
of Default.

 

 

IN WITNESS WHEREOF,
the undersigned officer has executed this Compliance Certificate as of the date
first written above.

 

	
   

  	
  STAPLES,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  

 

2

 

COMPLIANCE CERTIFICATE WORKSHEET

 

Financial Covenants

 

For the period ended
                ,
20

 

I.                                        §7.1
- Fixed Charge Coverage Ratio (reported
quarterly)

 

For the period of
four consecutive fiscal quarters then ended:

 

	
  A.

  	
   

  	
  Consolidated EBIT:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  Rental Expense: Obligations under store rental
  agreements of leases of real property (excluding Capitalized Leases and
  Synthetic Leases):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
   

  	
  Sum of A plus B:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
   

  	
  Consolidated Total Interest Expense:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E.

  	
   

  	
  Rental Expense from B

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F.

  	
   

  	
  Sum of D plus E:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  G.

  	
   

  	
  Ratio of C to F:

  	
   

  	
                   :1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  H.

  	
   

  	
  Minimum required ratio for test period:

  	
   

  	
  1.50 : 1

  

 

 

II.                                    §7.2
– Adjusted Funded Debt to Total Capitalization Ratio (reported  quarterly)

 

	
  A.

  	
   

  	
  Consolidated Adjusted Funded Debt:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
  Consolidated Total Funded Debt:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (a)

  	
  Indebtedness relating to the borrowing of money or
  obtaining of credit:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
  (b)

  	
  Deferred purchase price of assets:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
  (c)

  	
  Obligations under Synthetic Leases and Capitalized
  Leases:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (d)

  	
  Securitizations permitted under §6.1(q) of the
  Credit Agreement:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
  (e)

  	
  Guarantees of the above type of Indebtedness (a-d):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
  (f)

  	
  Sum of (1)(a) plus (1)(b) plus
  (1)(c) plus (1)(d) plus (1)(e):

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
  Rental Expense for period of 12 consecutive
  months then ended

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

  	
  A(2) multiplied by eight (8)

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
  Sum of A(1)(f) plus A(3)

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  Stockholders’ Equity:

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
   

  	
  Ratio of A(4) to A(4) plus B:

  	
   

  	
               :1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
   

  	
  Maximum Ratio Permitted:

  	
   

  	
  0.75 : 1

  

 

2

 

EXHIBIT D

 

FORM OF ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment
and Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between the Assignor (as defined below) and the Assignee
(as defined below). Capitalized terms used but not defined herein shall have
the meanings given to them in the Credit Agreement (as defined below), receipt
of a copy of which is hereby acknowledged by the Assignee. The Standard Terms
and Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor
hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby
irrevocably purchases and assumes from the Assignor, subject to and in
accordance with the Standard Terms and Conditions and the Credit Agreement, as
of the Effective Date inserted by the Administrative Agent as contemplated
below (i) all of the Assignor’s rights and obligations in its capacity as
a Lender under the Credit Agreement and any other documents or instruments
delivered pursuant thereto to the extent related to the amount and percentage
interest identified below of all of such outstanding rights and obligations of
the Assignor under the respective facilities identified below (including
without limitation any letters of credit, guarantees, and swingline loans
included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any
other right of the Assignor (in its capacity as a Lender) against any Person,
whether known or unknown, arising under or in connection with the Credit
Agreement, any other documents or instruments delivered pursuant thereto or the
loan transactions governed thereby or in any way based on or related to any of
the foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i) above
(the rights and obligations sold and assigned by the Assignor to the Assignee
pursuant to clauses (i) and (ii) above being referred to herein
collectively as the “Assigned Interest”). Each such sale and assignment
is without recourse to the Assignor and, except as expressly provided in this
Assignment and Assumption, without representation or warranty by the Assignor.

 

	
  1

  	
   

  	
  Assignor :

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Assignee :

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Credit
  Agreement:

  	
   

  	
  The Credit
  Agreement dated as of July 1, 2008 among Staples, Inc., the Lenders
  party thereto, Lehman Commercial Paper Inc., as Administrative Agent, and the
  other agents party thereto

  

 

 

4.                                      Assigned
Interest:

 

	
  Facility Assigned(1)

  	
   

  	
  Amount of Commitment/

  Loans Assigned

  	
   

  	
  Percentage Assigned of

  Commitment/Loans

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  %

  

 

5.                                      Effective
Date of Assignment:  
                          
      , 20      (2)

 

The terms set forth in
this Assignment and Assumption are hereby agreed to:

 

	
   

  	
  [Name of Assignee]

  	
   

  	
   

  	
  [Name of Assignor]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	
  Title:

  
							

 

(1) Fill in the appropriate terminology for the types of
facilities under the Credit Agreement that are being assigned under this
Assignment.

 

(2) To be inserted by Administrative Agent and which shall be the
effective date of recordation of transfer in the Register therefor.

 

2

 

	
  Accepted and Consented To:

  	
   

  	
  Consented To:

  
	
   

  	
   

  	
   

  
	
  (3)[LEHMAN COMMERCIAL PAPER INC., as

  Administrative Agent

  	
   

  	
  [STAPLES, INC., 

  as Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Title:]

  	
   

  	
   

  	
  Title:]

  

 

(3) Insert
appropriate consenting parties required under Credit Agreement

 

3

 

ANNEX 1

 

STANDARD TERMS AND
CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.                                      Representations
and Warranties.

 

1.1.                             Assignor.
The Assignor (a) represents and warrants that (i) it is the legal and
beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute
and deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of
the Borrower, any of its Subsidiaries or Affiliates or any other Person
obligated in respect of any Loan Document or (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.

 

1.2.                             Assignee.
The Assignee (a) represents and warrants that (i) it has full power
and authority, and has taken all action necessary, to execute and deliver this
Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets
all the requirements to be an Eligible Assignee under the Credit Agreement
(subject to receipt of such consents, if any, as may be required under the
Credit Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a Lender thereunder and, to
the extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it is sophisticated with respect to decisions to acquire
assets of the type represented by the Assigned Interest and either it, or the
person exercising discretion in making its decision to acquire the Assigned
Interest, is experienced in acquiring assets of such type, (v) it has
received a copy of the Credit Agreement, and has received or has been accorded
the opportunity to receive copies of the most recent financial statements delivered
pursuant to the Credit Agreement, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest, (vi) it has, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest, and (vii) if it is a Non-U.S. Lender, attached to this
Assignment and Assumption is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

 

 

2.                                      Payments.
From and after the Effective Date, the Administrative Agent shall make all
payments in respect of the Assigned Interest (including payments of principal,
interest, fees and other amounts) to the Assignor for amounts which have
accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.

 

3.                                      General
Provisions. This Assignment and Assumption shall be binding upon, and inure
to the benefit of, the parties hereto and their respective successors and assigns.
This Assignment and Assumption may be executed in any number of counterparts,
which together shall constitute one instrument. Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be
governed by, and construed in accordance with, the law of the State of New
York.

 

 

EXHIBIT E

 

FORM OF JOINDER AGREEMENT

 

This Joinder Agreement and Affirmation (this “Joinder
Agreement”) dated as of
              
      ,
         is executed and delivered by [                  ]  (the “New  Guarantor”), pursuant to §§3.14
and 5.14 of the Credit Agreement, dated as of July 1, 2008 (as the
same may be amended and in effect from time to time, the “Credit Agreement”),
among (a) Staples, Inc. (the “Borrower”), (b) the lending
institutions which are or may become parties thereto from time to time
(collectively, the “Lenders”), (c) Lehman Commercial Paper Inc., as
administrative agent for the Lenders (the “Administrative Agent”) and (d) Bank
of America, N.A. and HSBC Bank USA, National Association, as Co-Syndication
Agents. Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to such in the Credit Agreement.

 

WHEREAS, the New
Guarantor wishes to guaranty the Borrower’s payments and performance of the
Obligations and to become party to the Guaranty dated as of July [    ],
2008 (the “Guaranty”) by Staples The Office Superstore, LLC, Staples The
Office Superstore East, Inc., Staples Contract & Commercial, Inc.
and Staples The Office Superstore, Limited Partnership [and other
guarantors, if any, to be specified]
(collectively, the “Guarantors”) in favor of the Administrative Agent
for the benefit of itself and the Lenders;

 

NOW THEREFORE, the
New Guarantor hereby agrees with the Lenders and the Administrative Agent as
follows:

 

Joinder to
Guaranty. The New Guarantor hereby guarantees the full and
punctual payment when due (whether at stated maturity, by required prepayment,
by acceleration or otherwise), as well as the performance of all of the
Obligations (subject to the limitations contained in the Guaranty) and, by
executing and delivering this Joinder Agreement, does hereby join and become a
party to the Guaranty as a “Guarantor” (as defined in the Guaranty) thereunder,
assuming all of the obligations and liabilities of a “Guarantor” (as defined in
the Guaranty) thereunder, including without limitation, guaranteeing all
Obligations arising or incurred after the Effective Date. The New Guarantor
hereby agrees to comply with, and be bound by, all of the terms and conditions
of the Guaranty in all respects as an original “Guarantor” (as defined in the
Guaranty) thereunder, as if such New Guarantor were an original signatory
thereto.

 

Conditions to
Effectiveness. Upon satisfaction of the following conditions,
this Joinder Agreement shall be deemed effective as of the date hereof (the “Joinder
Effective Date”):

 

Joinder Agreement.
The Administrative Agent shall have received this Joinder Agreement duly
executed by the New Guarantor and in full force and effect.

 

Officer’s
Certificate for New Guarantor. The Administrative Agent shall
have received a certificate of an appropriate officer of the New Guarantor,
dated as of the date hereof, certifying as to (i) its [Certificate of
Partnership/Certificate of Incorporation] certified as of a recent date by the
Secretary of State of the state of its organization, (ii) a true and correct
copy of its

 

 

[Partnership
Agreement/Operating Agreement/By Laws], including all amendments thereto, (iii) the
corporate actions taken by the New Guarantor authorizing the execution,
delivery, and performance of this Joinder Agreement and all related documents,
and (iv) the names, titles, incumbency, and specimen signatures of the
officers of the New Guarantor authorized to sign this Joinder Agreement and all
related documents on behalf of the New Guarantor, in form and substance
satisfactory to the Administrative Agent.

 

Good Standing
Certificate. The Administrative Agent shall have received a
certificate as to the legal existence and good standing of the New Guarantor
from the Secretary of State of the state of its organization, dated as of a
recent date.

 

Legal Opinion.
The Administrative Agent shall have received an opinion from counsel to the New
Guarantor as to the due authorization and enforceability of this Joinder
Agreement, the due organization, legal existence and good standing of the New Guarantor,
in form and substance satisfactory to the Administrative Agent.

 

Schedule 2 to
the Credit Agreement. Pursuant to §3.14 of the Credit
Agreement, Schedule 2 to the Credit Agreement shall be replaced as
of the Joinder Effective Date by Schedule 2 attached hereto.

 

Representations
and Warranties. The New Guarantor represents and warrants to
the Administrative Agent and the Lenders that it has the requisite authority to
execute and deliver this Joinder Agreement and to perform all of the
obligations hereunder and of a Guarantor under the Guaranty and the Credit
Agreement, and the New Guarantor hereby makes, as to itself, all of the
representations and warranties made in the Guaranty and the Credit Agreement by
any Guarantor.

 

Governing Law.
This Joinder Agreement shall be governed by and construed in accordance with
the laws of the State of New York (excluding the laws applicable to conflicts
or choice of law).

 

Miscellaneous.
This Joinder Agreement shall be binding upon the undersigned and its successors
and assigns and shall inure to the benefit of the Lenders, the Administrative
Agent and their respective successors and assigns. This Joinder Agreement may
be executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which counterparts taken together shall be deemed to
constitute one and the same instrument.

 

[Remainder of Page Intentionally
Left Blank]

 

2

 

IN WITNESS WHEREOF, the undersigned has duly
executed this Joinder Agreement as a sealed instrument as of the date first set
forth above.

 

	
   

  	
  [NEW
  GUARANTOR]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  

 

3

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