1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly period ended June 29, 1996 ----------------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to -------------------- ----------------------- Commission file number 1-10948 ------------------------------------------------------ OFFICE DEPOT, INC. - ------------------------------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 59-2663954 - ------------------------------------------------------------------------------ (State or other jurisdiction (I.R.S. Employer incorporation or organization) Identification No.) 2200 Old Germantown Road, Delray Beach, Florida 33445 - ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip Code) (407) 278-4800 - ------------------------------------------------------------------------------ (Registrant's telephone number including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirement for the past 90 days. Yes X No --- --- The registrant had 156,838,374 shares of common stock outstanding as of August 7, 1996. 2 OFFICE DEPOT, INC. INDEX Page Part I. FINANCIAL INFORMATION Item 1 Financial Statements Consolidated Statements of Earnings for the 13 and 26 Weeks Ended June 29, 1996 and July 1, 1995 3 Consolidated Balance Sheets as of June 29, 1996 and December 30, 1995 4 Consolidated Statements of Cash Flows for the 26 Weeks Ended June 29, 1996 and July 1, 1995 5 Notes to Consolidated Financial Statements 6-7 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 8-13 Part II. OTHER INFORMATION 13-14 SIGNATURE 15 INDEX TO EXHIBITS 16 2 3 OFFICE DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (In thousands, except per share amounts) (Unaudited) 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 29, July 1, June 29, July 1, 1996 1995 1996 1995 ---------- ---------- ---------- ---------- Sales $1,381,365 $1,200,410 $3,014,360 $2,551,622 Cost of goods sold and occupancy costs 1,056,661 928,606 2,334,278 1,974,989 ---------- ---------- ---------- ---------- Gross profit 324,704 271,804 680,082 576,633 Store and warehouse operating and selling expenses 224,982 179,238 471,755 382,405 Pre-opening expenses 4,357 2,912 5,498 6,164 General and administrative expenses 40,387 35,786 84,830 72,891 Amortization of goodwill 1,306 1,297 2,636 2,592 ---------- ---------- ---------- ---------- 271,032 219,233 564,719 464,052 ---------- ---------- ---------- ---------- Operating Profit 53,672 52,571 115,363 112,581 Other expense (income) Interest expense, net 6,318 6,812 11,174 11,631 Equity and franchise (income) loss, net (78) 406 367 373 ---------- ---------- ---------- ---------- Earnings before income taxes 47,432 45,353 103,822 100,577 Income taxes 19,195 17,935 42,102 40,685 ---------- ---------- ---------- ---------- Net earnings $ 28,237 $ 27,418 $ 61,720 $ 59,892 ========== ========== ========== ========== Earnings per common and common equivalent share: Primary $ 0.18 $ 0.18 $ 0.39 $ 0.39 Fully diluted $ 0.18 $ 0.18 $ 0.38 $ 0.38 3 4 OFFICE DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) June 29, December 30, 1996 1995 ----------- ------------ (Unaudited) ASSETS Current Assets Cash and cash equivalents $ 17,589 $ 61,993 Receivables, net of allowances 337,375 380,431 Merchandise inventories 1,252,500 1,258,413 Deferred income taxes 27,443 18,542 Prepaid expenses 10,953 11,620 ----------- ------------ Total current assets 1,645,860 1,730,999 Property and Equipment, net 614,396 565,082 Goodwill, net of amortization 192,664 195,302 Other Assets 46,731 39,834 ----------- ------------ $ 2,499,651 $ 2,531,217 =========== ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable $ 613,549 $ 841,589 Accrued expenses 182,700 166,575 Income taxes 15,878 10,542 Current maturities of long-term debt 2,441 3,309 ----------- ------------ Total current liabilities 814,568 1,022,015 Long-Term Debt, less current maturities 197,932 112,340 Deferred Taxes and Other Credits 18,127 11,297 Zero Coupon, Convertible, Subordinated Notes 390,986 382,570 Common Stockholders' Equity Common stock - authorized 400,000,000 shares of $.01 par value; issued 159,301,319 in 1996 and 157,961,801 in 1995 1,593 1,580 Additional paid-in capital 619,153 605,876 Foreign currency translation adjustment (761) (794) Retained earnings 459,803 398,083 Less: 2,163,447 shares of treasury stock (1,750) (1,750) ----------- ------------ 1,078,038 1,002,995 ----------- ------------ $ 2,499,651 $ 2,531,217 =========== ============ 4 5 OFFICE DEPOT, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Increase (Decrease) in Cash and Cash Equivalents (In thousands) (Unaudited) 26 Weeks Ended 26 Weeks Ended June 29, July 1, 1996 1995 -------------- -------------- Cash flows from operating activities Cash received from customers $ 3,019,591 $ 2,512,748 Cash paid for merchandise inventories (2,431,936) (2,025,380) Cash paid for store and warehouse operating, selling and general and administrative expenses (596,391) (522,332) Interest received 725 132 Interest paid (3,286) (2,305) Taxes paid (42,597) (50,143) ------------- ------------- Net cash used by operating activities (53,894) (87,280) ------------- ------------- Cash flows from investing activities Capital expenditures-net (79,380) (98,100) ------------- ------------- Net cash used by investing activities (79,380) (98,100) ------------- ------------- Cash flows from financing activities Proceeds from exercise of stock options and sales of stock under employee stock purchase plan 9,367 8,767 Foreign currency translation adjustment 33 1,092 Proceeds from long- and short-term borrowings 120,833 176,430 Payments on long- and short-term borrowings (41,363) (3,038) ------------- ------------- Net cash provided by financing activities 88,870 183,251 ------------- ------------- Net decrease in cash and cash equivalents (44,404) (2,129) Cash and cash equivalents at beginning of period 61,993 32,406 ------------- ------------- Cash and cash equivalents at end of period $ 17,589 $ 30,277 ============= ============= Reconciliation of net earnings to net cash used by operating activities Net earnings $ 61,720 $ 59,892 Adjustments to reconcile net earnings to net cash used by operating activities Depreciation and amortization 39,025 30,377 Accreted interest on convertible, subordinated notes 8,420 8,145 Contributions of common stock to employee benefit and stock purchase plans 1,895 1,640 Changes in assets and liabilities Decrease (increase) in receivables 43,056 (23,942) Decrease (increase) in inventories 5,913 (48,899) Increase in prepaid expenses and other assets (16,198) (14,268) Decrease in accounts payable, accrued expenses and deferred credits (197,725) (100,225) ------------- ------------- Total adjustments (115,614) (147,172) ------------- ------------- Net cash used by operating activities $ (53,894) $ (87,280) ============= ============= 5 6 OFFICE DEPOT, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The interim financial statements as of June 29, 1996 and for the 13 and 26 week periods ended June 29, 1996 and July 1, 1995 are unaudited; however, such interim statements reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the financial position and the results of operations for the interim periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year. The interim financial statements should be read in conjunction with the audited financial statements for the year ended December 30, 1995. 2. Net earnings per common and common equivalent share is based upon the weighted average number of shares and equivalents outstanding during each period. Stock options are considered common stock equivalents. The zero coupon, convertible, subordinated notes are not common stock equivalents. Net earnings per common share assuming full dilution was determined on the assumption that the convertible notes were converted as of the beginning of the period or when issued. Net earnings under this assumption have been adjusted for interest net of its tax effect. The information required to compute net earnings per share on a primary and fully diluted basis is as follows: 13 Weeks 13 Weeks 26 Weeks 26 Weeks Ended Ended Ended Ended June 29, July 1, June 29, July 1, 1996 1995 1996 1995 -------- -------- -------- -------- Primary: Weighted average number of common and common equivalent shares 158,718 153,642 158,424 153,544 ======== ======== ======== ======== Fully Diluted: Net Earnings $ 28,237 $ 27,418 $ 61,720 $ 59,892 Interest expense related to convertible notes, net of tax 2,596 2,495 5,136 4,969 -------- -------- -------- -------- Adjusted net earnings $ 30,833 $ 29,913 $ 66,856 $ 64,861 ======== ======== ======== ======== Weighted average number of common and common equivalent shares 158,720 154,074 158,433 153,760 Shares issued upon assumed conversion of convertible notes 16,565 16,580 16,565 16,580 -------- -------- -------- -------- Shares used in computing net earnings per common and common equivalent share assuming full dilution 175,285 170,654 174,998 170,340 ======== ======== ======== ======== 6 7 3. The Consolidated Statements of Cash Flows do not include the following non-cash investing and financing transactions: 26 Weeks Ended 26 Weeks Ended June 29, July 1, 1996 1995 ----------- ----------- Additional paid-in capital related to tax benefit on stock options exercised $ 2,021,000 $ 1,994,000 Equipment purchased under capital leases 5,252,000 --- Conversion of convertible, subordinated debt to common stock 6,000 129,000 7 8 Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Sales increased 15% to $1,381,365,000 in the second quarter of 1996 from $1,200,410,000 in the second quarter of 1995 and 18% to $3,014,360,000 for the first six months of 1996 from $2,551,622,000 for the first six months of 1995. Approximately 43% of the increase in sales for the first six months was due to the 79 new stores (net of one store closure) opened subsequent to the second quarter of 1995. Comparable sales for stores and delivery facilities open for more than one year at June 29, 1996 increased 6% for the second quarter of 1996 and 8% for the first half of 1996. While sales of computers, business machines and related supplies rose as a percentage of total sales in the first six months of 1996 over the comparable 1995 period, sales of computers slowed in the second quarter. Additionally, retail prices of paper-related products have decreased, resulting in declining sales dollars on these products. The Company opened 22 office supply stores in the second quarter of 1996, bringing the total number of office supply stores open at the end of the second quarter to 527, compared with 448 stores open at the end of the second quarter of 1995. The Company also operated 23 and 24 contract stationer and delivery warehouses (customer service centers) at the end of the second quarters of 1996 and 1995, respectively. Several of these are new, larger facilities which replaced existing facilities acquired as part of the contract stationer acquisitions in 1993 and 1994. Additionally, in the second quarter of 1996, the Company opened one Images(TM) location resulting in a total of four Images(TM) locations, along with its two Furniture At Work(TM) stores open throughout the quarter. Gross profit as a percentage of sales was 23.5% and 22.6% during the second quarter and first half of 1996, respectively, as compared with 22.6% during the comparable quarter and first six months of 1995. Gross profit has been positively impacted by improved operating efficiencies in the Company's crossdock facilities. Additionally, margins in the contract stationer business in 1996 have improved slightly from the first quarter to the second quarter. However, lower margin business machines and computers have become a larger percentage of the Company's total sales, resulting in downward pressure on gross profit percentages. The Company's management believes that gross profit as a percentage of sales may fluctuate as a result of numerous factors, including continued expansion of its contract stationer business, increased competitive pricing pressure in more market areas, continued change in sales product mix, continued fluctuation in paper prices, as well as the Company's ability to achieve purchasing efficiencies through growth in total merchandise purchases. Additionally, occupancy costs may increase in new markets and in certain existing markets where the Company plans to add new stores and warehouses to complete its market plan. Store and warehouse operating and selling expenses as a percentage of sales were 16.3% and 15.7% in the second quarter and first six months of 1996, respectively, as compared to 14.9% and 15.0% in the second quarter and first six months of 1995, respectively. Store and warehouse operating and selling expenses, consisting primarily of payroll and advertising expenses, have increased primarily due to additional costs incurred in the integration of the Company's contract stationer and delivery business. These expenses as a percentage of sales are significantly higher in the 8 9 contract stationer business than in the retail business, principally due to the need for a more experienced and more highly compensated sales force. Management expects that as the Company progresses toward full integration of this business, certain fixed expenses will decrease in relation to sales, thereby improving the Company's overall store and warehouse operating expense ratio. However, this improvement in integration-related expenses is not expected to significantly impact the Company's expenses until 1997. Similarly, in the retail business, while the majority of store expenses vary proportionately with sales, there is a fixed cost component to these expenses that, as sales increase within each store and within a cluster of stores in a given market area, should decrease as a percentage of sales. This benefit has partially offset the integration-related impact on operating expenses, as the number of new stores has declined as a percentage of the Company's total retail sales base. Additionally, when the Company enters large metropolitan market areas where the advertising costs for the full market must be absorbed by the small number of facilities opened, advertising expenses are initially higher as a percentage of sales. As additional stores in these large markets are opened, advertising costs, which are substantially a fixed expense for a market area, have been and should continue to be reduced as a percentage of total sales. The Company has also continued a strategy of opening stores in existing markets. While increasing the number of stores increases operating results in absolute dollars, this also has the effect of increasing expenses as a percentage of sales since the sales of certain existing stores in the market may be adversely affected. Pre-opening expenses increased to $4,357,000 in the second quarter of 1996 from $2,912,000 in the comparable quarter in 1995 and decreased from $6,164,000 to $5,498,000 in the first half of 1996 as compared to the same period in 1995. The Company added 26 office supply stores in the first six months of 1996, 22 of which were in the second quarter, as compared with 29 in the comparable 1995 period, 16 of which were in the second quarter. Pre-opening expenses in the first half of 1995 include costs associated with replacing six existing customer service centers with larger, more functional facilities, while the first half of 1996 pre-opening expenses include costs associated with replacing only one customer service center. Pre-opening expenses, which currently approximate $150,000 per standard office supply store and greater for a megastore, are predominately incurred during a six-week period prior to the store opening. Warehouse pre-opening expenses approximate $500,000; however, these expenses may vary with the size of future warehouses. These expenses consist principally of amounts paid for salaries and property expenses. Since the Company's policy is to expense these items during the period in which they occur, the amount of pre-opening expenses in each period is generally proportional to the number of new stores or customer service centers opened or in the process of being opened during the period. General and administrative expenses decreased as a percentage of sales to 2.9% and 2.8% for the quarter and six months, respectively, ended June 29, 1996 from 3.0% and 2.9% for the comparable 1995 periods, respectively. However, still impacting these expenses is the Company's commitment, throughout 1995 and 1996, to improving the efficiency of its management information systems and increasing its information systems programming staff. While this increases general and administrative expenses in current periods, partially offsetting other efficiencies, the Company believes the systems investment will provide benefits in the future. General and administrative expenses in prior years had been higher as a percentage of sales in the contract stationers' business than in the retail business. However, these expenses have decreased in 1996 as a percentage of sales, positively affecting the Company's overall general and administrative expenses. There can be no assurance that the Company will be able to continue to increase sales without a proportionate increase in corporate expenditures. 9 10 LIQUIDITY AND CAPITAL RESOURCES Since the Company's inception in March 1986, the Company has relied on equity capital, convertible debt and bank borrowings as the primary sources of its funds. Since the Company's store sales are substantially on a cash and carry basis, cash flow generated from operating stores provides a source of liquidity to the Company. Working capital requirements are reduced by vendor credit terms, which allow the Company to finance a portion of its inventories. The Company utilizes private label credit card programs administered and financed by financial service companies, which allow the Company to expand its store sales without the burden of additional receivables. The Company has also utilized capital equipment financings as a source of funds. Sales made to larger customers are generally made under regular commercial credit terms where the Company carries its own receivables, as opposed to sales made to smaller customers, in which payments are generally tendered in cash or credit cards. Thus, as the Company continues to expand into servicing additional large companies, it is expected that the Company's trade receivables will continue to grow. Receivables from vendors under rebate, cooperative advertising and marketing programs, which comprise a significant percentage of total receivables, tend to fluctuate seasonally, growing during the second half of the year and declining during the first half. This is the result of collections generally made after an entire program year is completed. In the first six months of 1996, the Company added 26 office supply stores, compared with 29 new office supply stores added in the comparable period of 1995. Net cash used by operating activities was $53,894,000 in the first six months of 1996, compared with net cash used by operating activities of $87,280,000 in the comparable 1995 period. As stores mature and become more profitable, and as the number of new stores opened in a year becomes a smaller percentage of the existing store base, cash generated from operations of existing stores should provide a greater portion of funds required for new store inventories and other working capital requirements. Cash utilized for capital expenditures was $79,380,000 and $98,100,000 in the first six months of 1996 and 1995, respectively. During the 26 weeks ended June 29, 1996, the Company's cash balance decreased by $44,404,000 and long- and short-term debt increased by $79,468,000, excluding $8,420,000 in non-cash accretion of interest on the Company's zero coupon, convertible debt and $5,252,000 of equipment purchased under capital leases. The Company has a credit agreement with its principal bank and a syndicate of commercial banks to provide for a working capital line and letters of credit totaling $300,000,000. The credit agreement provides that funds borrowed will bear interest, at the Company's option, at either: the higher of the prime rate or .5% over the Federal 10 11 Funds rate; the LIBOR rate plus .25% to .375%, depending on the fixed charge coverage ratio; 1.75% over the Federal Funds rate; or under a competitive bid facility. The Company must also pay a facility fee of between .125% and .25% per annum, depending on the Company's fixed charge coverage ratio on the available and unused portion of the credit facility. The credit facility currently expires June 30, 2000. As of June 29, 1996, the Company had outstanding borrowings of $178,459,000 and had outstanding letters of credit totaling $14,500,000 under the credit facility. The credit agreement contains certain restrictive covenants relating to various financial statement ratios. In addition to the credit facility, the bank has provided a lease facility to the Company under which the bank has agreed to purchase up to $25,000,000 of equipment on behalf of the Company and lease such equipment to the Company. As of June 29, 1996, the Company has utilized approximately $18,321,000 of this lease facility. In July 1996, the Company entered into an additional lease facility with another bank for up to $25,000,000 of equipment. The Company plans to open 40 to 50 new office supply stores and replace one or two delivery warehouses during the remainder of 1996. Management estimates that the Company's cash requirements, exclusive of pre-opening expenses, will be approximately $1,700,000 for each additional office supply store, which includes an average of approximately $900,000 for leasehold improvements, fixtures, point-of-sale terminals and other equipment in the stores, as well as approximately $800,000 for the portion of the store inventories that is not financed by vendors. The cash requirements, exclusive of pre-opening expenses, for a delivery warehouse is expected to be approximately $5,300,000, which includes an average of $3,100,000 for leasehold improvements, fixtures and other equipment and $2,200,000 for the portion of inventories not financed by vendors. In addition, management estimates that each new store and warehouse will require pre-opening expenses of approximately $150,000 and $500,000, respectively. Pre-opening expenses for a megastore will be higher than a regular office supply store. FUTURE OPERATING RESULTS With the exception of historical matters, the matters discussed in this Quarterly Report on Form 10-Q are forward-looking statements that involve risks and uncertainties, including those discussed below. The factors discussed below could affect the Company's actual results and could cause the Company's actual results during the remainder of 1996 and beyond to differ materially from those expressed in any forward-looking statement made by the Company. The Company competes with a variety of retailers, dealers and distributors in a highly competitive marketplace. High-volume office supply chains and contract stationers that compete directly with the Company operate in most of its geographic markets. This competition will increase in the future as both the Company and these and other companies continue to expand their operations. There can be no assurance that such competition will not have an adverse effect on the Company's business in the future. The opening of additional Office Depot stores, the expansion of the Company's contract stationer business in new and existing markets, competition from other office supply chains and contract stationers, and regional and national economic conditions will all affect the Company's comparable sales results. In addition, the Company's gross margin and profitability would be adversely affected if its competitors 11 12 were to attempt to capture market share by reducing prices. The Company plans to continue its strategy of aggressive store growth, opening 40 to 50 new office supply stores during the remainder of 1996. There can be no assurance that the Company will be able to find favorable store locations, negotiate favorable leases, hire and train employees and store managers, and integrate the new stores in a manner that will allow it to meets its expansion schedule. The failure to be able to expand by opening new stores on plan could have a material adverse effect on the Company's future sales growth and profitability. In addition, as the Company expands the number of its stores in existing markets, sales of existing stores can suffer. New stores typically take time to reach the levels of sales and profitability of the Company's existing stores and there can be no assurance that new stores will ever be as profitable as existing stores because of competition from other store chains and the tendency of existing stores to share sales as the Company opens new stores in its more mature markets. Fluctuations in the Company's quarterly operating results have occurred in the past and may occur in the future. A variety of factors such as new store openings with their concurrent pre-opening expenses, the extent to which new stores are less profitable as they commence operations, the effect new stores have on the sales of existing stores in more mature markets, the pricing activity of both stores and contract stationers in the Company's markets, changes in the Company's product mix, increases and decreases in net advertising and promotional expenses, the effects of seasonality, acquisitions of contract stationers and stores of competitors or other events could contribute to this quarter to quarter variability. The Company has grown dramatically over the past several years and has shown significant increases in its sales, stores in operation, employees and warehouse and delivery operations. In addition, the Company acquired a number of contract stationer operations and the expenses incurred in the integration of acquired facilities in its delivery business have contributed to increased warehouse expenses. These integration costs are expected to continue to impact store and warehouse expenses at decreasing levels through the end of 1996. The failure to achieve the projected decrease in integration costs towards the latter half of 1996 could result in a significant impact on the Company's net income. The Company's growth, through both store openings and acquisitions, will continue to require the expansion and upgrading of the Company's operational and financial systems, as well as necessitate the hiring of new managers at the store and supervisory level. The Company has entered a number of international markets using licensing agreements and joint venture arrangements. The Company intends to enter other international markets as attractive opportunities arise. In addition to the risks described above that face the Company's domestic store and delivery operations, internationally the Company also faces the risk of foreign currency fluctuations, local conditions and competitors, obtaining adequate and appropriate inventory and, since its foreign operations are not wholly-owned, a lack of operating control in certain countries. 12 13 The Company believes that its current cash and cash equivalents, equipment leased under the Company's existing or new lease financing arrangements and funds available under its revolving credit facility should be sufficient to fund its planned store and delivery center openings and other operating cash needs, including investments in international joint ventures, for at least the next twelve months. However, there can be no assurance that additional sources of financing will not be required during the next twelve months as a result of unanticipated cash demands or opportunities for expansion or acquisition, changes in growth strategy or adverse operating results. Also, alternative financing will be considered if market conditions make it financially attractive. There also can be no assurance that any additional funds required by the Company, whether within the next twelve months or thereafter, will be available to the Company on satisfactory terms. PART II. OTHER INFORMATION Items 1-3 Not applicable. Item 4 Submission of Matters to a Vote of Security Holders At the Annual Meeting of Stockholders of Office Depot, Inc. held on May 23, 1996, the following nominees for election as Directors of the Corporation were elected: Number of Shares ---------------- Nominee For Withheld ------- ---- -------- Mark D. Begelman 123,659,648 419,369 Cynthia Cohen Turk 123,688,394 390,623 Herve Defforey 123,674,101 404,916 David I. Fuente 123,678,595 400,422 W. Scott Hedrick 123,693,077 385,940 James L. Heskett 123,688,348 390,669 John B. Mumford 123,687,852 391,165 Michael J. Myers 123,675,577 403,400 Peter J. Solomon 123,695,817 383,200 Alan L. Wurtzel 123,692,050 386,967 The number of shares of broker non-votes for the election of Directors was none. 13 14 In addition, the appointment of Deloitte & Touche LLP as independent public accountants to audit the Corporation's consolidated financial statements for the fiscal year ending December 28, 1996 was approved by the following vote: For the proposal: 123,805,015 Against the proposal: 147,064 Abstaining: 126,939 The number of shares of broker non-votes in the above proposal was none. Item 5 Not applicable. Item 6 Exhibits and Reports on Form 8-K a. 3.1 Amended and Restated Bylaws 27.1 Financial Data Schedule (for SEC use only). b. The Company did not file any Reports on Form 8-K during the quarter ended June 29, 1996. 14 15 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OFFICE DEPOT, INC. ------------------ (Registrant) Date: August 12, 1996 By:/s/ Barry J. Goldstein -------------------------------- Barry J. Goldstein Executive Vice President-Finance and Chief Financial Officer 15 16 INDEX TO EXHIBITS 3.1 Amended and Restated Bylaws 27.1 Financial Data Schedule (for SEC use only) 16