Exhibit 10.2
Execution Copy
SIXTH AMENDMENT TO AMENDED AND
RESTATED
MERCHANT SERVICES AGREEMENT
This SIXTH AMENDMENT (the
“Sixth Amendment”) to the Amended and Restated Merchant
Services Agreement dated as of February 1, 2004 between
CITIBANK (SOUTH DAKOTA), N.A., successor to CITIBANK (USA), N.A.,
(“Bank”) and OFFICE DEPOT, INC.,
(“Company”) is dated as of this 6th day of February,
2009.
WITNESSETH:
WHEREAS, Bank and Company entered
into a certain Amended and Restated Merchant Services Agreement
dated as of February 1, 2004 (the “Agreement”), as
amended; and
WHEREAS, Bank and Company wish to
revise the Agreement in certain respects, as hereafter
described;
NOW, THEREFORE, in consideration of
the mutual covenants herein contained, the parties hereto agree as
follows:
1. Definitions . The
definition of “Required Reserve Amount” is hereby
deleted and replaced with the following new definition:
“Required Reserve
Amount” means, at any point in time, the product of the then
applicable Reserve Percentage multiplied by the Account balances,
except that the Required Reserve Amount following termination or
non-renewal of this Agreement for any reason shall be the product
of the applicable Reserve Percentage multiplied by the Account
balances existing as of the effective date of such termination or
non-renewal.
2. Section 2.2(b) is hereby
deleted and replaced with the following new
Section 2.2(b):
(b) Plan Exclusivity . During
the Term, neither Company nor any other party on behalf of Company
will enter into any arrangement or agreement with a third party
provider under which Company issues, sponsors, participates in or
accepts another private label credit card, or private label credit
account, including any credit card or account under any of
Company’s names or logos or any other credit card or account
that would otherwise compete with the Card Plan except for a
co-branded general purpose credit card issued by a third party or
Company (“Co-branded Card”). Notwithstanding the
foregoing, nothing contained in this Agreement will be construed to
prohibit Company from accepting any major general purpose credit
card (e.g., NOVUS, American Express, MasterCard or Visa) as a means
of payment by customers for purchases of Authorized Goods and
Services. Company agrees that Bank shall have the right to review,
and approve or decline each Application submitted by a customer or
prospective customer of Company applying for a private label credit
card or private label credit account before such Application is
provided to any other party. Subject to the foregoing sentence,
Company may offer secondary sources of financing to those of its
customers that do not qualify for an Account, provided Company does
not issue, arrange to issue, or accept any private label credit
card or private label credit account in connection with such
financing.
3. Section 3.10(b) is hereby
deleted and replaced with the following new
Section 3.10(b):
(b) Method of Recourse . Bank
is not required to pay Company for a Card Sale which is being
charged back. If Bank has already paid Company for such Card Sale,
Bank, at its sole discretion, may deduct the amount to be charged
back from the Settlement Account or charge such amount against a
future payment to Company. Alternatively, Bank may demand that
Company pay Bank the amount of the Chargeback and Company shall
make such payment within three (3) Business Days of such
demand. Any Chargebacks which are not paid by the aforesaid means
shall be due and payable by Company promptly on demand.
4. Section 4.1(e) is hereby
deleted and replaced with the following new
Section 4.1(e):
(e) Bank may charge the amount of
the Merchant Fee, fees specified in Schedule I and any other
amounts owed by Company under this Agreement against the Settlement
amount and/or from amounts calculated pursuant to
Section 4.1(a)(i), above due Company, or Bank may debit the
Settlement Account in the amount of the Merchant Fee and any other
amounts owed by Company under this Agreement. If Bank elects the
former and the Settlement amount due Company is insufficient to
cover the Merchant Fee and any other amounts owed under this
Agreement, Bank, at its option, may charge the amounts owed under
this Agreement or any remaining portion thereof against subsequent
amounts due Company or debit the Settlement Account. Any amounts
owed which cannot be paid by the aforesaid means shall be due and
payable by Company upon Bank’s written demand.
5. Section 4.4 is hereby
deleted and replaced with the following new
Section 4.4:
4.4 Bonus Payments . Upon
execution of this Agreement, Bank shall pay to Company the sum of
Eight Million Dollars ($8,000,000) as a signing bonus. In addition,
Bank will credit to the Marketing Fund the sum of Five Hundred
Thousand Dollars ($500,000) upon execution of this Agreement and an
additional Five Hundred Thousand Dollars ($500,000) on the first
anniversary of the Effective Date of this Agreement. In the event
that this Agreement terminates prior to September 30, 2011 for
any reason other than a termination by Company pursuant to Sections
4.1(c)(ii) or 6.2(b)(iii), Company shall pay to Bank an amount
equal to $97,826.09 multiplied by the number of months remaining on
the Term (the “Unamortized Premium”). Bank may charge
any amount owed by Company pursuant to this Section 4.4
against the Settlement Account.
6. Section 5.1 is hereby
deleted and replaced with the following new
Section 5.1:
5.1 Reserve Fees Account
Handling .
(a) Bank shall maintain an
accounting of the Reserve Fees paid by Company as set forth in
Section 4.2, above, which shall be identified as the Reserve
Fees Account. The Reserve Fees Account maintained pursuant to the
Prior Agreements shall be held by Bank and shall constitute the
opening balance of the Reserve Fees Account established pursuant to
this Agreement. Each month Bank will charge against the Reserve
Fees Account (i) the Losses during the previous month (which
shall include all amounts that are due or accrued under the
Accounts) of all Accounts in each of the Commercial Revolve Card
Plan, Commercial Revolve No Fee Plan, Commercial Invoice Card Plan
and Credit Exception Accounts; and (ii) any Chargebacks and
other amounts to which Bank is entitled under this Agreement that
have not been paid via a charge to Settlement or the Settlement
Account or otherwise by Company following Bank’s demand (the
“ Contingent Liabilities ”). Each month Bank
s
