BOISE CASCADE OFFICE PRODUCTS CORP, 424B3, 1996-06-18

BOISE CASCADE OFFICE PRODUCTS CORP
424B3, 1996-06-18
PAPER & PAPER PRODUCTS

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4,392,014 Shares

[BCOP Logo]

Boise Cascade
Office Products Corporation

Common Stock
(par value $.01 per share)
__________________

The 4,392,014 shares of common stock, par value $.01
per share (the "Common Stock"), covered by this
Prospectus may be offered and issued from time to time
by Boise Cascade Office Products Corporation (the
"Company") in connection with acquisitions of other
businesses, properties or securities in business
combination transactions in accordance with Rule
415(a)(1)(viii) of Regulation C under the Securities Act
of 1933 (the "Securities Act"). This Prospectus may
also be used, with the Company's prior consent, by
persons who have received or will receive shares in
connection with acquisitions and who wish to offer and
sell such shares under circumstances requiring or making
desirable its use. See "Securities Covered by this
Prospectus" and see the inside back cover page hereof
for the identity of such persons, if any.

The Common Stock is traded on the New York Stock
Exchange under the symbol "BOP." On June 10, 1996, the
closing sale price of the Common Stock on the New York
Stock Exchange Composite Tape as reported in the Wall
Street Journal (Midwest Edition) was $38 per share. See
"Price Range of Common Stock and Dividend Policy." See
"Risk Factors" at page 6 of this Prospectus for a
discussion of certain factors relevant to an investment
in the Common Stock.

All references in this Prospectus to numbers of
shares of Common Stock and to prices and earnings per
share of Common Stock, and all presentations herein of
the Company's capital accounts, have been adjusted to
reflect a two-for-one split of the Common Stock in the form of
a 100% stock dividend distributed on May 20, 1996 to
shareholders of record at the close of business on May 6, 1996.

__________________

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
__________________

The date of this Prospectus is June 17, 1996.

<PAGE>
No person has been authorized to give any information or to
make any representations other than those contained in this
Prospectus, and, if given or made, such information or
representations must not be relied upon as having been
authorized. This Prospectus does not constitute an offer to
sell or the solicitation of an offer to buy any securities other
than the securities to which it relates or an offer to sell or
the solicitation of an offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication
that there has been no change in the affairs of the Company
since the date hereof or that the information contained herein
is correct as of any time subsequent to its date.

TABLE OF CONTENTS

Page
Available Information. . . . . . . . . . . . . . . . . . . . . .
Prospectus Summary . . . . . . . . . . . . . . . . . . . . . . .
Forward Looking Information. . . . . . . . . . . . . . . . . . .
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . .
Securities Covered by this Prospectus. . . . . . . . . . . . . .
Price Range of Common Stock and Dividend Policy. . . . . . . . .
Selected Consolidated Financial Data . . . . . . . . . . . . . .
Recent Developments. . . . . . . . . . . . . . . . . . . . . . .
Management's Discussion and Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . . . . . . . . .
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Management . . . . . . . . . . . . . . . . . . . . . . . . . . .
Relationship with Boise Cascade Corporation. . . . . . . . . . .
Ownership of Stock of the Company and Boise Cascade Corporation.
Description of Capital Stock . . . . . . . . . . . . . . . . . .
Shares Eligible for Future Sale. . . . . . . . . . . . . . . . .
Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Index to Financial Statements. . . . . . . . . . . . . . . . . .F-1

AVAILABLE INFORMATION

The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports, proxy
statements, and other information with the Securities and
Exchange Commission (the "Commission"). Reports, registration
statements, proxy statements, and other information filed by the
Company with the Commission can be inspected and copied at the
public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, and at the Commission's Regional Offices: 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661 and 7 World
Trade Center, New York, New York 10048. Copies of such
materials can be obtained from the Public Reference Section of
the Commission, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates.

The Company has filed a Registration Statement on Form S-1
(the "Registration Statement") with the Commission in
Washington, D.C., under the Securities Act with respect to the
Common Stock offered hereby. As used herein, the term
"Registration Statement" means the Registration Statement as
initially filed with the Commission and any and all amendments
thereto. This Prospectus omits certain information contained in
the Registration Statement as permitted by the rules and
regulations of the Commission. For further information with
respect to the Company and the Common Stock offered hereby,
reference is made to the Registration Statement, including the
exhibits thereto. Statements herein concerning the contents of
any contract or other document are not necessarily complete, and
in each instance reference is made to such contract or other
document filed with the Commission as an exhibit to the
Registration Statement, or otherwise filed with the Commission
and incorporated by reference in the Registration Statement.
Each such statement is in all respects qualified by such
reference.

PROSPECTUS SUMMARY

This summary is qualified in its entirety by the detailed
information and financial statements appearing elsewhere in this
Prospectus.

The Company

General

Boise Cascade Office Products Corporation (with its
subsidiaries, the "Company") is one of the largest direct
suppliers of office products to businesses in the United States
and, beginning in 1996, in Canada and the United Kingdom. The
Company operates primarily in two channels for the distribution
of office products: the contract stationer channel and the
direct mail channel.

Throughout its 32-year history of operating in the contract
stationer channel, the Company's primary focus has been and
remains large business customers. The Company distributes a
broad line of branded and private label products for use in the
office, including consumable supplies, furniture, computer-
related items and other products. The Company's product line is
offered through its annual full line catalog and a variety of
specialized catalogs, and sold by the Company's direct sales
force.

The Company entered the direct mail channel of the office
products distribution industry through its acquisition in April
1994 of the direct mail office products supply business of The
Reliable Corporation ("Reliable"), the third largest direct mail
distributor of office products in the United States. Reliable
primarily serves small- and medium-sized business customers and
home offices in the United States and, beginning in 1996, in the
U.K.

As of March 31, 1996, the Company operated 46 integrated
distribution centers enabling it to provide consistent products,
prices and service, including next-day delivery of virtually all
orders, to customers. The Company believes that none of its
competitors can currently match this national service
capability.

Strategy For Growth

The Company has grown rapidly over the last few years. In
1995, sales increased 45% compared with 33% in 1994 and 9% in
1993. The increase in sales on a same-location basis was 26% in
1995, 15% in 1994, and 7% in 1993. The Company intends to
continue to be a major player in the rapidly consolidating
office products distribution industry. This is being
accomplished through the Company's four-part growth strategy, as
follows:

Expand Through Acquisitions. The Company intends to continue
acquiring contract stationers in new locations where the
application of the Company's business model can accelerate the
acquired stationer's sales growth and maintain or improve its
profitability. The Company also considers acquisitions which
expand its presence in existing locations. The Company
typically seeks to retain management and to draw on its
knowledge of the local market while, at the same time,
integrating the acquired business into the Company's nationwide
distribution network. In those geographic areas where the
Company desires to expand its presence, but where no attractive
acquisition candidates are located, the Company anticipates
developing start-up operations. In addition, the Company
intends to expand its office products marketing and distribution
capabilities in foreign countries as appropriate opportunities
arise.

Acquisitions completed in 1995 were located in Columbus,
Ohio; Norfolk, Virginia; Louisville, Kentucky; Cleveland, Ohio;
Boise, Idaho; Rochester, New York; St. Louis, Missouri; Tampa,
Florida; Pittsburgh, Pennsylvania; and Doncaster, England.
Acquisitions announced in 1995 and completed in 1996 include
Grand & Toy Ltd., Canada's largest office products distributor
(as described below); Loring, Short and Harmon in Portland,
Maine; and McAuliffe's in Burlington, Vermont. Additional 1996
acquisitions completed as of March 31, 1996 include Sierra Vista
in Albuquerque, New Mexico, and Office Essentials in Milwaukee,
Wisconsin.

The Company completed the acquisition of 100% of the shares
of Grand & Toy from Cara Operations Limited (Toronto) on
February 5, 1996. Grand & Toy operates six distribution centers
and approximately 80 retail stores across Canada. Sales for
Grand & Toy's fiscal year ended April 2, 1995, were $C281
million (US$205 million). Sales for the fiscal year
ended March 31, 1996, were $C322 million (US$237 million).

Increase National Accounts. The Company believes there is
increasing recognition on the part of large multi-site
businesses of the efficiency and cost-effectiveness of uniform
system-wide purchasing of their office products requirements.
The Company also believes it currently has a competitive
advantage in its combination of nationwide coverage and systems
in the U.S. and Canada which provide consistent delivery of
products, prices and services. A key element of the Company's
strategy is to expand sales to large customers having multiple
offices. The Company has added to its national account
marketing and service teams so that it can continue to increase
its national account business.

The Company's sales to its national account customers in 1995
were $406 million compared with $246 million in 1994, and $189
million in 1993.

Broaden the Customer Base. The Company's growth strategy
also aims to expand its business with small- and medium-sized
businesses and home offices, a market segment which is growing
more rapidly than the large business customer segment, and
usually cannot be cost-effectively served through the direct
sales force of the contract stationer channel. In April 1994,
the Company acquired Reliable, the third largest direct mail
distributor of office products in the United States. Management
believes that a direct marketing operation such as Reliable's
provides the most convenient and cost-effective way for small-
and medium-sized businesses to purchase office products and
that, over time, it will become the preferred avenue for these
customers to meet their office products needs. At year-end
1995, Reliable entered Great Britain with the acquisition of
Neat Ideas, the U.K.'s second largest office products direct
marketer.

The Company also believes that operating and marketing
synergies exist between its two main distribution channels that
can enhance service and profitability. Operating synergies
include distribution center consolidation and utilization of a
common order fulfillment system that enhances Reliable's ability
to provide next-day delivery to its customers. Sales and
marketing synergies include database marketing, telemarketing
and other outbound marketing methods acquired through Reliable
which may enable the Company to leverage its direct sales force
in the contract stationer channel.

During 1995, Reliable's sales were $201 million. Sales for
the eight months Reliable was owned by the Company in 1994 were
$105 million. Reliable's active customer list grew to 382,000
in 1995 compared to 282,000 in 1994.

Increase Sales of Existing Product Categories and Add New
Categories. A fourth component of the Company's growth strategy
involves increased sales of products to existing customers, both
through the sale of a broader array of product categories, such
as copier and fax paper and office furniture, and through the
introduction of new product categories, such as computer-related
items. As a result of these efforts to broaden the product mix
purchased by existing customers, the Company's sales of copier
and fax paper, measured by volume, increased by 60% in 1995 over
1994. Similarly, office furniture has not been, until recently,
a focus of the Company's marketing efforts. A few of the
Company's locations have historically sold a substantial volume
of office furniture while most others have sold very little.
The Company's growth strategy targets office furniture, with the
goal of increasing its sale across the system, especially at
those locations where such sales have been modest.

Knowing that customers' needs for computer supplies,
hardware, software and peripherals were increasing rapidly, the
Company acquired WTS in September 1995. WTS, based in St.
Louis, Missouri, distributes computer-related products to
businesses nationwide. As a result of this acquisition, the
Company is expanding its offering of computer-related products
across its distribution network.

The Company may offer additional product categories and
services in the future depending upon the needs of its
customers.

Business Model

The Company's objective is to be the preferred supplier of
office products to business customers by outperforming
competitors at all levels--to "out-national" its national
competitors and "out-local" its local competitors. The Company
manages centrally where it is cost-effective to do so or there
is value to its customers in nationwide consistency, and manages
locally where it is important to be responsive to local
opportunities or customer requirements. Centralized functions
include computer systems, merchandising (including product and
vendor selection and catalog preparation), logistics support,
and, to an increasing extent, inventory stocking decisions,
purchasing, order entry and customer service. Functions
typically performed locally through the Company's distribution
centers, each of which is operated as a profit center, include
recruiting and hiring, sales management, and a variety of
customer or location-unique services and products. Other key
elements of the Company's business model include the rigorous
analysis and control of costs, including the use of a
comprehensive activity-based cost management system, its ABCM
System, and the use of a needs-based customer segmentation
analysis to develop a marketing program and service package
appropriate for the needs of each of its customers.

Initial Public Offering

Prior to April 13, 1995, the Company was a wholly-owned
subsidiary of Boise Cascade Corporation ("BCC"). On that date,
the Company completed concurrent United States and international
initial public offerings (the "Offerings") of an aggregate of
10,637,500 shares of Common Stock at a price of $12.50 per
share. After completion of the Offerings, BCC owned 82.7% of
the Company's outstanding Common Stock.

The net proceeds to the Company from the Offerings (after
deduction of the underwriting discount and expenses) were
approximately $123,076,000. A total of $100,000,000 of such
proceeds was used by the Company to replace working capital in
the form of accounts receivable retained by BCC in connection
with the Organization (as defined below). Of the remaining
proceeds, $21,217,000 was retained by the Company for general
corporate purposes, including to fund the Company's growth
strategy, and $1,859,000 was paid as a dividend to BCC.

On June 30, 1995 and April 15, 1996, the Company filed
registration statements with the Securities and Exchange
Commission covering a total of 5,339,666 shares of Common Stock
to be offered by the Company from time to time in connection
with acquisitions. As of May 31, 1996, 1,346,376 shares had
been issued or were reserved for future issuance pursuant to a
stock note agreement under these registration statements.

The Company's principal executive offices are located at 800
W. Bryn Mawr Avenue, Itasca, Illinois 60143, and its telephone
number is (708) 773-5000.

Risk Factors

See "Risk Factors" for a discussion of certain factors
relevant to an investment in the Common Stock.

Relationship with Boise Cascade Corporation

BCC currently owns approximately 81.5% of the Company's
outstanding Common Stock. As a result of its current ownership
interest, BCC is able to control the vote on all matters
submitted to stockholders, including the election of directors
and the approval of extraordinary corporate transactions.
Currently, four of the six members of the Company's Board of
Directors are officers and/or directors of BCC.

Prior to April 1, 1995, the Company's business was operated
as the Boise Cascade Office Products Distribution Division of
BCC, including Reliable and certain other subsidiaries (the
"Division"). Effective April 1, 1995, pursuant to an Asset
Transfer and Subscription Agreement between the Company and BCC
(the "Subscription Agreement"), BCC transferred to the Company
substantially all of the assets and liabilities associated with
the Division, other than certain accounts receivable, in
exchange for shares of Common Stock of the Company. At the same
time, the Company and BCC entered into several other agreements
governing certain aspects of their ongoing relationship (the
"Intercompany Agreements"), including a long-term Paper Sales
Agreement, a Shareholder Agreement, an Administrative Services
Agreement, a Tax Matters Agreement and a License Agreement.
Transactions effected in connection with the organization of the
Company, including those described above, are collectively
referred to herein as the "Organization". As used in this
Prospectus, unless the context otherwise requires, the term
"Company" refers to the office products distribution business of
the Division transferred by BCC to the Company pursuant to the
Subscription Agreement as if such business was at all times
owned and operated by the Company.

For additional information relating to the Subscription
Agreement, the Intercompany Agreements and the continuing
relationship between the Company and BCC, including potential
conflicts of interest, see "Risk Factors" and "Relationship with
Boise Cascade Corporation".

FORWARD LOOKING INFORMATION

Certain of the statements made in the Prospectus Summary and
under the captions "Recent Developments," "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" and "Business" in this Prospectus constitute
"forward-looking statements" within the meaning of Section 27A
of the Securities Act and Section 21E of the Exchange Act. Such
forward-looking statements include those relating to: the
Company's growth strategy and its future position in the
industry; the Company's acquisition program and its effect on
sales growth, service capacity and profitability; the Company's
business model; the Company's access to needed capital; proposed
acquisitions which have been announced by the Company but not yet
completed; and competitors and the Company's ability to compete
effectively.

Prospective purchasers of the Common Stock offered hereby are
cautioned that the actual results, performance or achievements
of the Company could differ materially from those projected in
such forward-looking statements as a result of the factors
set forth below. Accordingly, in considering the information
set forth in such forward-looking statements, prospective
purchasers of the Common Stock offered hereby should carefully
review the factors described in this Prospectus beginning on
page 6 under the captions "Risk Factors -- Competition," " --
Risks Associated with the Company's Growth Strategy," " --
Relationship and Possible Conflicts of Interest with Boise
Cascade Corporation," " -- Potential Sales of Stock by BCC or the
Company" and " -- Absence of Dividends," as well as the discussion
on pages 15 and 16 relating to gross margins and the cost of and
prices for copy paper under "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Results of
Operations -- Cost of goods sold" for both of the comparative annual
periods shown and the discussion on page 18 relating to paper cost
and prices and the Company's growth strategy under "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Impact of Inflation, Seasonality and Business Cycles."

RISK FACTORS

In addition to the other information in this Prospectus, the
following should be carefully considered in evaluating the
Company and its business before purchasing the Common Stock
offered hereby.

Competition

The Company faces a highly competitive environment in each of
the office products distribution channels in which it operates.
Competition is based principally on price, service and customer
relationships. An important aspect of the Company's ability to
compete for multi-site customers in the contract stationer
channel is its ability to deliver consistent products, prices
and service across all customer sites.

In the contract stationer channel the Company has experienced
increased competition in recent years due primarily to the
emergence of several other large participants seeking to
establish national distribution networks similar to that of the
Company. A number of these participants, which include some of
the major retail superstore companies, have grown, both
internally and through the acquisition of local or regional
contract stationers, at rates significantly faster than the
Company's rate of growth prior to 1994. Some of the Company's
competitors have greater financial resources and purchasing
power than the Company. The contract stationer operations of
the major superstore companies also benefit from their national
advertising and franchising programs. The Company also competes
with smaller local and regional contract stationers, many of
which have longstanding customer relationships.

In the direct mail channel, which accounted for approximately
15% of the Company's 1995 net sales, the Company's principal
competitors are two major direct mail office products
distributors, the retail superstore companies and, to a lesser
extent, local retail dealers.

The major superstore companies also compete with firms
operating in both the direct mail channel and the contract
stationer channel as they increasingly target medium-sized
business customers by offering delivery service and utilizing
direct mail programs to send catalogs to potential customers.

The Company believes that this increasing competition and
industry consolidation has in recent years, and will continue
for the foreseeable future to, adversely affect the gross
margins of most participants in the office products distribution
business, including the Company. See "Business--The Office
Products Distribution Industry", "--Strategy for Growth" and "--
Competition", and see "Management's Discussion and Analysis of
Financial Condition and Results of Operations".

Risks Associated with the Company's Growth Strategy

Following the sale of its wholesale distribution business in
1992, the Company adopted a new growth strategy. See "Business-
- -Development of the Company" and "--Strategy for Growth". The
initial results of this strategy are reflected in the Company's
recent results of operations, including substantial growth in
sales and operating income. The Company's rate of growth in
each of 1994 and 1995 was well in excess of its historical
growth rate; the Company's net sales increased 45% in 1995 over
1994 and 33% in 1994 over 1993, compared to average annual
growth in sales in 1991 through 1993 of 3.7%. The Company
intends to continue its growth in the future through the
continued execution of its strategy. The overall market for
office products has not grown significantly in recent years, a
trend which the Company believes will continue in the future.
Accordingly, the Company's ability to continue to expand will be
dependent on a number of factors, including its success in
acquiring smaller domestic contract stationers and integrating
their operations with those of the Company, its success in
gaining new customers and increasing sales to existing
customers, its ability to hire, train and retain sufficient
skilled personnel, the availability of appropriate acquisition
opportunities in foreign markets and the availability of
adequate financing. There can be no assurance that the Company
will attain its desired rate of growth, or that if it does, such
growth will improve its profitability.

Acquisitions. The Company's growth strategy is dependent to
a substantial degree on its ability to effect acquisitions.
Some of the Company's major competitors have similar acquisition
strategies, and the office products distribution industry is
consolidating rapidly. As a result, there is substantial
competition for suitable acquisition candidates in many markets.
The Company is continuously engaged in the pursuit of
acquisitions and is currently in discussion with several
acquisition candidates, both domestic and foreign. There can be
no assurance that the Company will be able to acquire other
office products businesses on terms favorable to the Company.
If the Company continues to complete its desired acquisitions,
it will encounter various associated risks and costs, including
the possible inability to integrate an acquired domestic
business into the Company's nationwide distribution network,
increased goodwill amortization, diversion of management's
attention and unanticipated problems or liabilities. With the
expansion of the Company into foreign markets, through the
recent acquisition of office products companies in Canada and
Great Britain, and the intention of the Company to expand into
additional foreign markets as appropriate opportunities arise,
the management and integration issues associated with the
Company's acquisitions will become increasingly important. Some
or all of the foregoing risks associated with the Company's
acquisition strategy could have a material adverse effect on the
Company's operations and financial performance.

Financing. The Company's continued strategy for growth is
expected to require greater capital for its successful execution
than the Company required prior to 1994. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources". Prior to the
Organization, the Company's business was conducted as a division
of BCC and its capital requirements were funded through BCC. No
further financing can be expected to be available to the Company
from or through BCC. No assurance can be given that the
Company's existing financial resources, including cash flow from
operations and amounts available under its Credit Facility, will
be sufficient to fund its future growth. The Company may be
required to seek other external funding sources in order to
finance its expansion strategy, which sources may not be
available on terms favorable to the Company or at all. These
sources could include, subject to market conditions, additional
offerings by the Company of its equity or debt securities. See
"Management's Discussion and Analysis of Financial Condition and
Results of Operations--Liquidity and Capital Resources".

Relationship and Possible Conflicts of Interest with Boise Cascade Corporation

BCC currently owns approximately 81.5% of the outstanding
shares of Common Stock of the Company. As a result, BCC is able
to elect all of the members of the Company's Board of Directors
and exercise a controlling influence over the business and
affairs of the Company, including any determinations with
respect to mergers or other business combinations, the
acquisition or disposition of assets, the incurrence of
indebtedness, the issuance of additional Common Stock or other
equity or debt securities, and the payment of dividends with
respect to its Common Stock. In addition, BCC, by virtue of its
controlling ownership in the Company, has the power to approve
all matters submitted to a vote of the Company's shareholders
without the consent of the Company's other shareholders. See
"Relationship with Boise Cascade Corporation".

Currently, four of the six directors of the Company are also
directors and/or officers of BCC and all of the current
directors of the Company were selected by BCC. Any director,
executive officer or employee of BCC who serves as a director,
executive officer or employee of the Company may have conflicts
of interest in addressing business opportunities and strategies
with respect to which the Company's and BCC's interests may
differ. Mr. Danis, the Company's Chief Executive Officer, Ms.
Moerdyk, the Company's Chief Financial Officer, and
Mr. Milliken, the Company's Senior Vice President, Operations,
continue to be executive officers of BCC, although they are
employees of the Company and devote all of their business time
to the affairs of, and are compensated only by, the Company. In
addition, John W. Holleran, who is a Vice President and General
Counsel of BCC and is compensated only by BCC, serves as the
Company's General Counsel, and A. James Balkins III, who is a
Vice President and Corporate Secretary of BCC and is compensated
only by BCC, serves as the Company's Corporate Secretary.

The Company was organized by BCC and, prior to the
Organization, its business was conducted as a division of BCC.
As part of the Organization, the Company and BCC entered into a
Subscription Agreement pursuant to which, effective April 1,
1995, BCC transferred the business of the Division to the
Company. Contemporaneously, the Intercompany Agreements were
entered into between the Company and BCC, including: a long-term
Paper Sales Agreement, pursuant to which BCC sells cutsize paper
to the Company for resale to the Company's customers; a
Shareholder Agreement, granting to BCC a purchase option, in
certain circumstances, with respect to equity securities
thereafter proposed to be issued by the Company and registration
rights with respect to such securities and the Common Stock
currently owned by BCC; an Administrative Services Agreement
pursuant to which BCC provides the Company with various
administrative and other services; a Tax Matters Agreement,
pursuant to which the Company and BCC will, for so long as BCC
owns at least 50% of the voting securities of the Company,
allocate and coordinate tax benefits, payments, and return
preparation responsibilities; and a License Agreement, pursuant
to which BCC granted to the Company a license to use certain
tradenames and trademarks.

As a result of the relationship between the Company and BCC,
the terms of the Subscription Agreement and the Intercompany
Agreements were determined by BCC and were not the result of
arm's-length negotiations. Prior to their execution by the
Company, the Subscription Agreement and each of the Intercompany
Agreements were approved by the Committee of Independent
Directors of the Board of Directors of the Company, whose
current members are, and whose future members will be,
independent of BCC. Additional or modified arrangements and
transactions may be entered into by the Company and BCC. While
any such future arrangements and transactions are expected to be
determined through negotiations between them, there can be no
assurance that conflicts of interest will not arise. Although
the Company has not adopted any formal procedures designed to
ensure that conflicts of interest will not occur, the Company
intends to seek the approval of the Committee of Independent
Directors for any agreement which its management or any
independent director of the Company believes to be of material
importance to the Company and to involve a significant conflict
of interest with BCC.

Notwithstanding the foregoing, the Committee of Independent
Directors may not be in a position to resolve certain conflicts
of interest which may arise in the future between the Company
and BCC. For example, the issuance by the Company of additional
shares of Common Stock, including to fund acquisitions or raise
capital, may be contrary to BCC's interest in avoiding
deconsolidation of the Company for tax purposes or the loss of
control of the Company through dilution. As noted above, the
Company has not adopted any formal plan or arrangement to
address such potential conflicts of interest. However, the
directors of the Company would take such steps as they deem
reasonable under all of the circumstances to resolve any
specific conflict of interest that may occur, which might
include, in appropriate circumstances, the retention of an
independent advisor. There can be no assurance, however, that
any such conflicts will be resolved in a manner favorable to the
Company, and BCC will be in a position to control the outcome.

Potential Sales of Stock by BCC or the Company

Sales by BCC or by the Company of substantial amounts of
Common Stock or, in the case of the Company, the issuance of
Preferred Stock, could adversely affect prevailing market prices
of the Common Stock.

At February 29, 1996, the Company had 62,315,526 shares of
Common Stock outstanding, of which 50,750,000 were held by BCC.
Pursuant to the Shareholder Agreement, BCC will be able to cause
the Company to register under the Securities Act of 1933, in
connection with their public sale, any or all of such shares of
Common Stock and certain other securities of the Company that it
may acquire in the future. In addition, beginning April 14,
1997, BCC will be permitted to sell in the public market
specified amounts of Common Stock without registration pursuant
to Rule 144 under the Securities Act.

The Company may issue and sell shares of Common Stock in the
future to fund acquisitions, including the shares of Common
Stock covered by this Prospectus. The Company may also issue
and sell shares of Common Stock, Preferred Stock, or debt
securities in the future to raise additional capital or for
other purposes. Any such issuance of equity securities in the
future would have a dilutive effect on the voting power of
current Company shareholders, and could have an adverse effect
on the then prevailing market price of the Common Stock.

Absence of Dividends

The Company intends to retain its earnings to finance its
growth and for general corporate purposes and therefore does not
anticipate paying any cash dividends in the foreseeable future.
In addition, the Company's Credit Facility contains a minimum
net worth covenant which could restrict the Company's ability to
pay dividends.

SECURITIES COVERED BY THIS PROSPECTUS

The shares of Common Stock covered by this Prospectus are
available for use in future acquisitions of other businesses,
properties, or securities in business combination transactions
in accordance with Rule 415(a)(1)(viii) of Regulation C under
the Securities Act. Such acquisitions may relate to businesses
similar or dissimilar to the Company's existing business. The
consideration offered by the Company in such acquisitions, in
addition to the shares of Common Stock offered by this
Prospectus, may include cash, debt, or other securities (which
may be convertible into shares of Common Stock covered by this
Prospectus), or the assumption by the Company of liabilities of
the business, properties, or securities being acquired or of
their owners, or a combination thereof. It is contemplated that
the terms of acquisitions will be determined by negotiations
between the Company and the owners of the businesses,
properties, or securities to be acquired, with the Company
taking into account the quality of management, the past and
potential earning power and growth of the businesses, properties
or securities acquired, and other relevant factors, and it is
anticipated that shares of Common Stock issued in such
acquisitions will be valued at a price reasonably related to the
market value of the Common Stock either at the time the terms of
the acquisition are tentatively agreed upon or at or about the
time or times of delivery of the shares.

The Company may from time to time, in an effort to maintain
an orderly market in the Common Stock, negotiate agreements with
persons receiving Common Stock in connection with acquisitions
that will limit the number of shares that may be sold by such
persons during specified periods. Such agreements may be more
restrictive than the restrictions on sales imposed pursuant to
various exemptions from the registration requirements of the
Securities Act, including the restrictions imposed by Rule 144
or Rule 145(d) under the Securities Act. In addition, certain
persons who are party to such agreements may not otherwise be
subject to such Securities Act restrictions. The Company
anticipates that, in general, such negotiated agreements will be
of limited duration and will permit the recipients of Common
Stock issued subject thereto to sell up to a specified number of
shares per business day or days.

With the consent of the Company, this Prospectus may also be
used by persons who have received or will receive from the
Company Common Stock covered by this Prospectus in connection
with acquisitions and who may wish to sell such stock under
circumstances requiring or making desirable its use. The
Company's consent to such use may be conditioned upon such
persons agreeing not to offer more than a specified number of
shares following supplements or amendments to this Prospectus,
which the Company may agree to use its best efforts to prepare
and file at certain intervals. The Company may require that any
such offerings be effected in an organized manner through
securities dealers.

Sales of Common Stock by means of this Prospectus may be made
from time to time privately at prices to be individually
negotiated with the purchasers, or publicly through transactions
effected on the New York Stock Exchange (which may involve block
transactions), at prices reasonably related to market prices at
the time of sale or at negotiated prices. Broker-dealers
participating in such transactions may act as agent or as
principal and, when acting as agent, may receive commissions
from the purchasers as well as from the sellers (if also acting
as agent for the purchasers). The Company may indemnify any
broker-dealer participating in such transactions against certain
liabilities, including liabilities under the Securities Act.
Profits, commissions, and discounts on sales by persons who may
be deemed to be underwriters within the meaning of the
Securities Act may be deemed underwriting compensation under the
Securities Act.

Stockholders may also offer shares of Common Stock issued in
future acquisitions by means of prospectuses under other
registration statements or pursuant to exemptions from the
registration requirements of the Securities Act, including sales
which meet the requirements of Rule 144 or Rule 145(d) under the
Securities Act, and stockholders should seek the advice of their
own counsel with respect to the legal requirements for such
sales.

See the inside back cover page of this Prospectus for the
identity of any persons who have received shares of Common Stock
in connection with acquisitions by the Company with respect to
whom the Company has consented to the use of this Prospectus in
connection with resales of such shares.

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

The Common Stock began trading on the New York Stock Exchange
on April 7, 1995. The range of the per share high and low
closing prices of the Common Stock as quoted on the New York
Stock Exchange Composite Tape for each quarterly period, or
portion thereof, subsequent to such initial trading date, as
reported by the Wall Street Journal (Midwest Edition), is as
follows:

Closing Price
1995 High Low
2nd Quarter $13-5/16 $11
3rd Quarter 14-7/8 11-3/16
4th Quarter 21-3/8 13-3/8

1996 High Low
1st Quarter $35-1/4 $21-1/8
2nd Quarter (through 44-1/8 31-1/16
June 10, 1996)

At February 29, 1996, there were approximately 2,730 record
holders of the Common Stock.

The Company intends to retain its earnings to finance its
growth, including acquisitions, and for general corporate
purposes and therefore does not anticipate paying any cash
dividends in the foreseeable future. The declaration and
payment of any future dividends will be subject to the
discretion of the Board of Directors of the Company and to
certain limitations under the General Corporation Law of the
State of Delaware. In addition, the Company's Credit Facility
contains a minimum net worth covenant which could restrict the
Company's ability to pay dividends. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources".

SELECTED CONSOLIDATED FINANCIAL DATA
(in thousands, except share and operating data)

The following table sets forth selected historical
consolidated financial data for the Company for each of the five
years 1991 through 1995 and for each of the three-month periods
ended March 31, 1995 and 1996, and pro forma consolidated
financial data for the Company for the year ended December 31,
1995, and the three months ended March 31, 1996. The selected
historical income statement data for 1992, 1993, 1994, and 1995
and the balance sheet data as of December 31, 1993, 1994, and
1995, have been derived from the Company's audited financial
statements. The selected historical income statement data for
1991 and for each of the three-month periods ended March 31,
1995 and 1996 and the balance sheet data as of December 31, 1991
and 1992 and March 31, 1996 have been derived from the unaudited
consolidated financial statements of the Company which, in the
opinion of management, include all adjustments (consisting
solely of normal recurring adjustments, except as noted below)
necessary to present fairly the financial information for such
periods and as of such dates. The data set forth below should
be read in conjunction with, and are qualified in their entirety
by reference to, the Company's audited Consolidated Financial
Statements and the Notes thereto, its unaudited Pro Forma
Consolidated Financial Statements and the Notes thereto, its
unaudited Condensed Interim Consolidated Financial Statements
and the Notes thereto and "Management's Discussion and Analysis
of Financial Condition and Results of Operations," which are
included elsewhere in this Prospectus.

<PAGE>

<TABLE>
<CAPTION>
Three Months
Year Ended December 31, Ended March 31,
Pro Forma Pro Forma
1991 1992 1993 1994(1) 1995(2) 1995(3) 1995(2) 1996(2) 1996(3)
Income Statement Data:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales . . . . . . $ 614,035 $ 625,860 $ 682,819 $ 908,520 $ 1,315,953 $ 1,735,891 $ 303,287 $ 461,423 $ 490,664
Cost of sales . . . . 451,883 465,981 505,993 676,515 980,564 1,289,937 231,466 338,526 359,743
_________ __________ _________ _________ ___________ ___________ __________ __________ __________
Gross profit. . . . . 62,152 159,879 176,826 232,005 335,389 445,954 71,821 122,897 130,921
_________ __________ _________ _________ ___________ ___________ __________ __________ __________
Selling and warehouse
operating expense
(4). . . . . . . . 123,064 133,413 134,331 172,876 238,885 (5) 54,311 87,095 (5)
Corporate general and
administrative
expense. . . . . . 13,015 12,564 13,247 15,541 24,750 (5) 4,761 6,854 (5)
Goodwill
amortization . . . 220 224 471 1,389 2,287 5,923 440 1,380 1,598
_________ __________ _________ _________ ___________ ___________ __________ __________ __________
Total operating
expense. . . . . . 136,299 146,201 148,049 189,806 265,922 366,265 59,512 95,329 102,743
_________ __________ _________ _________ ___________ ___________ __________ __________ ___________
Income from operation 25,853 13,678 28,777 42,199 69,467 79,689 12,309 27,568 28,178
Other income (expense),
net. . . . . . . . (335) 635 681 995 1,903 (8,212) 243 (1,241) (1,942)
_________ __________ _________ _________ ___________ ___________ __________ __________ __________
Income before income
taxes. . . . . . . 25,518 14,313 29,458 43,194 71,370 71,477 12,552 26,321 26,236
Income tax expense. . 9,887 5,548 11,412 16,729 28,191 29,130 4,833 10,764 10,824
_________ __________ _________ _________ ___________ ___________ __________ __________ __________
Income before
cumulative effect
of accounting
change . . . . . . 15,631 8,765 18,046 26,465 43,179 42,347 7,719 15,563 15,412
Cumulative effect of
accounting change,
net of tax (6). . . -- (2,444) -- -- -- -- -- -- --
_________ _________ _________ _________ ___________ ___________ _________ _________ __________
Net income. . . . . . $ 15,631 $ 6,321 $ 18,046 $ 26,465 $ 43,179 $ 42,347 $ 7,719 $ 15,563 $ 15,412

Earnings Per Share (7):
Net income per share:
Based upon 50,750,000
common shares out-
standing prior to
the Offerings . . $ .31 $ .12 $ .36 $ .52 $ .74 $ .71 $ .15 $ N/A $ N/A
Based upon 61,387,500
common shares out-
standing after
the Offerings. . . $ .25 $ .10 $ .29 $ .43 $ .70 $ .68 $ .13 $ .25 $ .25
Operating Data:
Distribution centers
at end of period . 17 20 21 27 36 46 27 46 46
Inventory turns(8). . 6.6 6.7 7.6 8.7 9.7 N/A 9.7 10.3 N/A
Increase over prior
period in sales on
same-location
basis (9). . . . . 0.1% 1.5% 6.6% 15.3% 26.1% N/A 24.7 18.0 N/A
</TABLE>

<TABLE>
<CAPTION>
As of December 31, As of March 31,
1991 1992 1993 1994 1995 1995 1996
Balance Sheet Data:
<S> <C> <C> <C> <C> <C> <C> <C>
Working capital . . . . $ 77,703 $ 75,133 $ 77,475 $104,835 $145,824 $131,677 $161,316
Total assets. . . . . . 233,901 234,119 227,959 352,369 544,124 382,083 732,396
Shareholders' equity (10) 162,146 159,566 149,819 233,432 339,417 264,747 355,353
___________________________
See footnotes on next page.
</TABLE>

<PAGE>
(1) Effective April 30, 1994, the Company acquired the direct mail office
products distribution business of Reliable. The acquisition was
accounted for as a purchase. Data for the year ended
December 31, 1994, includes the results of operations of the
acquired business for the eight months subsequent to its
acquisition.

(2) During 1995, the Company acquired ten office products distribution
businesses. During the three months ended March 31, 1996, the
Company acquired five such businesses. The acquisitions were
accounted for as purchases. Data for the year ended December
31, 1995 and the three months ended March 31, 1995, includes the
results of operations of the ten businesses acquired during 1995
for the periods subsequent to their acquisition. Data for the
three months ended March 31, 1996 includes the results of
operations for the five businesses acquired during the first
quarter of 1996 subsequent to their acquisitions.

(3) The unaudited pro forma income statement data for the year ended
December 31, 1995, gives effect to the ten acquisitions
completed by the Company in 1995 and the five 1996 acquisitions
completed by the Company through March 31, 1996, as if they had
occurred January 1, 1995. The unaudited pro forma income
statement data for the three months ended March 31, 1996, gives
effect to the five 1996 acquisitions completed by the Company
through March 31, 1996, as if they had occurred January 1, 1996.

(4) Income from operations includes the write-off of $1,416,000 in 1992 and
$5,236,000 in 1993 of deferred software costs that were
determined to have limited future value.

(5) Detailed information relating to these expense categories is not
available on a pro forma basis.

(6) Effective as of January 1, 1992, the Company adopted Financial
Accounting Standards Board requirements to accrue postretirement
benefit costs.

(7) Pro forma earnings per common share are presented for all periods prior
to 1996 because the Company was not incorporated until January
3, 1995, and the transfer of the assets of the Division to the
Company and corresponding issuance of shares to BCC occurred
April 1, 1995. The unaudited pro forma earnings per common
share prior to the Offerings for the years ended December 31,
1991 through 1995 and the three months ended March 31, 1995,
have been presented assuming that the issuance of shares to BCC
in connection with the Organization of the Company had taken
place at the beginning of the years and that the issuance of
shares pursuant to the Offerings occurred on April 13, 1995.
The unaudited pro forma earnings per common share after the
Offerings for the years ended December 31, 1991 through 1995 and
the three months ended March 31, 1995, assume that both the
issuance of shares pursuant to the Offerings and the issuance
of shares to BCC in connection with the Organization of the
Company had taken place at the beginning of the years. Shares
issued in 1995 to effect various acquisitions are included in
the calculations of average shares outstanding for 1995 as of
the acquisition dates. Actual earnings per common share for the
three months ended March 31, 1996 is based on average actual
common shares outstanding for the period. The unaudited pro
forma earnings per common share in the pro forma column for the
year ended December 31, 1995 gives effect to the ten
acquisitions completed by the Company in 1995 and the five 1996
acquisitions completed by the Company through March 31, 1996,
as if they had occurred January 1, 1995. The unaudited pro
forma earnings per common share in the pro forma column for the
three months ended March 31, 1996, gives effect to the five 1996
acquisitions completed by the Company through March 31, 1996,
as if they had occurred January 1, 1996.

(8) Inventory turns are calculated using the average monthly closing
inventory for the fiscal period and the merchandise cost of
sales for the fiscal period.

(9) The increase over the prior period in sales on a same-location basis is
calculated using only distribution centers that are included for
the entire comparable periods.

(10) Prior to April 1, 1995, the Company participated in BCC's centralized
cash management system. The net effect of the Company's
distributions to, and advances from, BCC is included in
shareholder's equity.

RECENT DEVELOPMENTS

Stock Split

The Company effected a two-for-one split of the Common Stock in
the form of a 100% stock dividend distributed on May 20, 1996 to
shareholders of record at the close of business on May 6, 1996.
All references in this Prospectus to numbers of shares of Common
Stock (except for the number of shares which the Company is
authorized to issue by its Restated Certificate of Incorporation,
which does not change) and to prices and earnings per share of
Common Stock, and all presentations herein of the Company's capital
accounts, have been appropriately adjusted to reflect the stock
split.

Amendment to Credit Facility

On June 5, 1996, the Company and its bank lenders entered into an
amended and restated Credit Facility which increases the amount which
may be borrowed thereunder to $350 million (from $225 million) and
extends its expiration date to 2001 (from 1999). See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources."

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

The Company's results of operations, expressed as the percentage
which each line item represents of total net sales, for each of the
years 1993, 1994 and 1995 and the three months ended March 31, 1995
and 1996 are set forth below (numbers may not add due to rounding):

<TABLE>
<CAPTION>
Three months
Year ended December 31, ended March 31,
1993 1994 1995 1995 1996
Net sales:
<S> <C> <C> <C> <C> <C>
Contract stationer sales
(except national accounts) 72.4% 61.3% 53.8% 53.8% 56.9%
National account sales* 27.6 27.1 30.9 30.0 27.2
Direct mail sales (Reliable) -.- 11.6 15.3 16.2 15.9
_____ _____ _____ _____ _____
100.0 100.0 100.0 100.0 100.0
Cost of sales 74.1 74.5 74.5 76.3 73.4
_____ _____ _____ _____ _____
Gross profit 25.9 25.5 25.5 23.7 26.6
_____ _____ _____ _____ ______
Operating expense:
Selling and warehouse 19.7 19.0 18.2 17.9 18.9
Corporate general and administrative 1.9 1.7 1.9 1.6 1.5
Goodwill amortization 0.1 0.2 0.2 .1 .3
_____ _____ _____ _____ _____
21.7 20.9 20.2 19.6 20.7
_____ _____ _____ _____ _____
Income from operations 4.2 4.6 5.3 4.1 6.0
Other income (expense), net 0.1 0.1 0.1 -.- (.3)
_____ _____ _____ _____ _____
Income before income taxes 4.3 4.7 5.4 4.1 5.7
Income tax provision 1.7 1.8 2.1 1.6 2.3
_____ _____ _____ _____ _____
Net income 2.6% 2.9% 3.3% 2.5% 3.4%

* A national account is a multi-site customer served by two or
more of the Company's distribution centers under a single contract
</TABLE>

<PAGE>

First Quarter of 1996 Compared with First Quarter of 1995

Net sales in the first quarter of 1996 increased 52% to $461.4
million, compared with $303.3 million in the first quarter of 1995.
The growth in sales resulted from increased national account
business, rapid growth in direct marketing, acquisitions, and
somewhat higher paper prices and volumes. Excluding the effect of
acquisitions since December 31, 1994, sales increased 18% in the
first quarter of 1996 compared to the first quarter of 1995.

Cost of goods sold, which includes the cost of merchandise sold
and delivery and occupancy costs, increased to $338.5 million in
the first quarter of 1996, which was 73.4% of net sales. This
compares with $231.5 million reported in the same period of the
prior year, which represented 76.3% of net sales. Gross profit as
a percentage of sales was 26.6% and 23.7% for the first quarter of
1996 and 1995. The increase in margins was due primarily to
improved margins in the Company's national account business and
higher paper prices quarter to quarter.

Operating expense was 20.7% of net sales in the first quarter of
1996, compared with 19.6% in the first quarter of 1995. Within the
operating expense category, selling and warehouse operating expense
was 18.9% of net sales in the first quarter of 1996, compared with
17.9% in the first quarter of 1995. This increase was primarily
the result of changes in the Company's product and channel mix due
to acquisitions. Corporate general and administrative expense
declined slightly to 1.5% of first quarter 1996 net sales from 1.6%
of the first quarter 1995 net sales.

As a result of the above factors, income from operations in the
first quarter of 1996 increased by $15.3 million to $27.6 million,
more than double the Company's first quarter 1995 operating income,
which was $12.3 million. Net income in the first quarter of 1996
more than doubled to $15.6 million, or 3.4% of net sales, compared
with $7.7 million, or 2.5% of net sales, in the same period of the
prior year.

1995 Compared with 1994

Net sales in 1995 increased 45% to $1.3 billion, from $909
million in 1994. The growth in sales resulted primarily from
higher paper prices and paper volumes, increased sales to national
accounts, rapid growth in the Company's direct-marketing business,
and acquisitions. Excluding the effect of acquisitions since
December 31, 1993, sales increased 26% in 1995. Of that 26%
increase, approximately one-fourth was due to higher paper prices.

Cost of goods sold, which includes the costs of merchandise
sold, delivery, and occupancy, increased in 1995 to $980.6 million,
which was 74.5% of net sales. This compares with $676.5 million in
1994, which also represented 74.5% of net sales. The overall
industry and Company trend with gross margins have been flat to
declining. The Company reported sequentially improving margins in
the second, third, and fourth quarters in 1995, mostly due to
passing through previous paper price increases, resulting in a flat
gross margin for the year compared to 1994. However, the Company
believes that the increasingly competitive nature of the industry
and the increasing price sensitivity of customers will continue to
put downward pressure on gross margins. In addition, changes in
the Company's product mix or marketing strategy could, from time to
time, affect gross margins.

Operating expense was 20.2% of net sales in 1995, compared with
20.9% in 1994. This decline was primarily the result of the
Company's cost controls and operating efficiency initiatives and
the leveraging of its operating expenses over higher sales volume.
Within the operating expense category, selling and warehouse
operating expense was 18.2% in 1995, compared with 19.0% of net
sales in 1994. Corporate general and administrative expense was
1.9% of net sales in 1995, compared with 1.7% in 1994.

As a result of the factors discussed above, income from
operations in 1995 increased to $69.5 million, a 65% increase over
1994 operating income of $42.2 million. The Company's operating
margin increased to 5.3% of net sales in 1995 from 4.6% of net
sales in 1994. Net income in 1995 increased 63% to $43.2 million,
or 3.3% of net sales, compared with $26.5 million or 2.9% of net
sales in 1994.

1994 Compared to 1993

Net sales in 1994 increased 33% to $909 million, compared with
$683 million in 1993. The 1994 sales included $106 million from
The Reliable Corporation which was purchased by the Company in
April 1994.

Cost of goods sold increased to $676.5 million in 1994, which
was 74.5% of net sales, compared with $506.0 million, or 74.1% of
net sales in 1993. The gross margin in 1994 was adversely affected
by product mix changes, the increasingly competitive nature of the
industry, modest overall growth rate, and the increasing price
sensitivity of customers. The decrease was offset in part by
higher-than-average margins on direct-marketing channel sales by
Reliable after its acquisition in 1994 and by the leveraging of
occupancy costs over increased sales.

Operating expense, before a 1993 write-off of deferred software
costs aggregating $5 million, was 20.9% of net sales in 1994 and
1993. Excluding Reliable, operating expense declined to 20.2% of
net sales in 1994 from 20.9% in 1993, due to the Company's cost
controls and operating efficiency initiatives, as well as the
leveraging of its corporate overhead over higher sales volume.
Within the operating expense category, selling and warehouse
expense was essentially flat, before considering the software
write-off, at 19.0% of 1994 net sales, compared to 18.9% of 1993
net sales. Corporate general and administrative expense declined
to 1.7% of net sales in 1994 from 1.9% of net sales in 1993.

Excluding the 1993 write-off, income from operations in 1994
increased 24.9% to $42.2 million from $33.8 million in 1993. The
Company's operating margin declined to 4.6% from 5.0% of net sales.
Net income increased 24.4% to $26.5 million in 1994, or 2.9% of net
sales, compared with $21.3 million or 3.1% of net sales in 1993.

Public Offering

On April 13, 1995, the Company completed the sale of 10,637,500
shares of Common Stock, at a price of $12.50 per share, in an
initial public offering. After the offering, BCC owned 82.7% of
the Company's outstanding Common Stock. Net proceeds were
approximately $123.1 million, $102 million of which was used by the
Company to replace working capital retained by BCC and to pay a
small dividend to BCC. The remainder of the proceeds,
approximately $21 million, was retained by the Company for general
corporate purposes. At December 31, 1995, BCC owned approximately
81.5% of the Company's outstanding Common Stock.

On June 30, 1995 and April 15, 1996, the Company filed
registration statements with the Securities and Exchange Commission
covering a total of 5,339,666 shares of Common Stock to be offered
by the Company from time to time in connection with acquisitions.
As of May 31, 1996, 1,346,376 shares had been issued or were
reserved for future issuance pursuant to a stock note agreement
under these registration statements.

Acquisitions

In 1995, the Company acquired 10 office products businesses,
including one in Great Britain, for cash of $62.1 million, payables
to the sellers of $10.6 million, most of which is due within one
year, and issuance of Common Stock and a stock note valued at $18.2
million at the time of issuance. During the three months ended
March 31, 1996, the Company acquired five such businesses for cash
of $129.3 million and recorded liabilities of $17.8 million; the
1996 acquisitions included Grand & Toy Ltd., the largest office
products distributor in Canada. The annualized sales of the
companies acquired in 1995 were $235 million as of the time such
acquisitions were announced. The annualized sales of the companies
acquired during the first quarter of 1996 were $301 million as of
the time such acquisitions were announced.

The Company's results of operations in 1994 and 1995 were
significantly affected by the acquisition in late April 1994 of the
direct mail office products distribution business of Reliable for
$71.3 million in cash (see "Business--Development of the Company").
Reliable's gross margins and operating expense ratios tend to be
somewhat higher than those of the Company's contract stationer
operations. No acquisitions were made in 1993.

Goodwill net of amortization was $114.9 million at December 31,
1995, and $55.7 million at December 31, 1994. The increase was the
result of acquisitions. The Company used purchase accounting to
record its acquisitions.

Liquidity and Capital Resources

The Company's principal requirements for cash have been to fund
working capital needs, upgrade and expand its facilities at
existing locations, open new distribution centers and make
acquisitions. Until the acquisition of Reliable, these cash
requirements were satisfied by cash flow from operations. The
funding of the Company's strategy for growth, including
acquisitions, and the relocation of several existing distribution
centers into new and larger facilities, is expected to require
capital outlays by the Company over the next several years. The
Company has budgeted total capital expenditures over the next three
years, exclusive of amounts attributable to acquisitions, of
approximately $125 million. In 1995, such capital expenditures
were $22.2 million.

To finance the Company's capital requirements, the Company
expects to rely upon funds from a combination of sources. The
Company anticipates continued cash flow from operations. In
addition, the Company has a $350 million revolving credit agreement
(the "Credit Facility"), which expires in 2001 and provides for
variable rates of interest based on customary indexes. The Credit
Facility is available for acquisitions and general corporate
purposes. It contains customary restrictive financial and other
covenants, including a negative pledge and covenants specifying a
minimum net worth, a minimum fixed charge coverage ratio and a
maximum leverage ratio. The lending banks may terminate the Credit
Facility, and accelerate the payment of any amounts borrowed
thereunder, in the event a Change of Control (as defined) of the
Company occurs. There was $110 million of borrowings outstanding
under the Credit Facility at May 31, 1996. See "Recent
Developments -- Amendment to Credit Facility."

In addition to available borrowing capacity under the terms of
the Credit Facility, the Company may, subject to the covenants
contained in the Credit Facility and to market conditions, raise
additional funds through other external debt or equity financing in
the future.

Financial Condition

Cash provided by operations for the first three months of 1996
was $26.2 million. This was the result of $21.8 million of net
income, depreciation and amortization, and other noncash items and
a $4.4 million increase in working capital. Net cash used for
investment in the first three months of 1996 was $143.3 million,
which included $10.6 million for capital expenditures and $129.3
million for acquisitions. Net cash provided by financing was
$116.1 million for the first three months of 1996, resulting from
borrowings made by the Company to fund acquisitions.

Cash used for operations in the first three months of 1995 was
$15.0 million. This was the result of $10.3 million of net income,
depreciation and amortization, and other noncash items offset by
$25.3 million of negative changes in working capital. Cash used
for investment in the first three months of 1995 was $8.5 million,
which included $5.9 million of expenditures for property and
equipment and $3.3 million for acquisitions. Net cash provided by
financing was $23.5 million for the first three months of 1995,
almost all of which was net equity transactions with Boise Cascade
Corporation.

Cash provided by operations in 1995 was $49.7 million. This was
the result of $56.6 million of net income, depreciation and
amortization, and other noncash items, offset by a $6.9 million net
increase in working capital. Net cash used for investment was
$79.6 million, which included $22.2 million for capital
expenditures and $61.6 million for acquisitions. Net cash provided
by financing was $43.9 million, which included $123.1 million from
the Company's sale of stock, offset in part by a $78.4 million net
equity transaction with BCC.

Cash provided by operations in 1994 was $31.7 million. This was
the result of $39.1 million of net income, depreciation and
amortization and other noncash items offset by a $7.4 million net
increase in working capital. Cash used for investment in 1994 was
$88.3 million, which included $78.5 million for acquisitions and
$6.5 million for capital expenditures. BCC made equity
contributions aggregating approximately $57.1 million in 1994.

Cash provided by operations in 1993 was $30.7 million. This was
the result of $32.8 million of net income, depreciation and
amortization and other noncash items, including the write-off of
$5.2 million of software development expenses, offset by $2.1
million of changes in working capital. Cash used for investment in
1993 was $2.9 million for capital expenditures. In 1993 the
Company transferred approximately $27.8 million in excess cash to
BCC.

Impact of Inflation, Seasonality and Business Cycles

Management believes inflation has not had a material effect on
the Company's financial condition or results of operations.
However, there can be no assurance that the Company's business will
not be affected by inflation in the future.

Although the sale of particular items sold by the Company is
seasonal (e.g., calendars and specialty gift items), the Company's
sales overall are not subject to significant seasonal variations.

The Company is a major distributor of copy paper. During 1994,
the Company's gross margin was adversely affected by the Company's
inability to immediately adjust prices to its customers to reflect
the rapid increases during the last quarter of 1994 in its cost of
paper. Since then, the Company has revised its contracts with
customers to improve its ability to pass on such cost increases.
Approximately one-fourth of the Company's 26% sales growth in 1995,
excluding acquisitions, was due to higher paper prices. The
Company is unable to predict when, or to what extent, paper prices
might significantly rise or fall and what favorable or adverse
impact those changes might have on the Company's sales and margins.

The Company's multifaceted growth strategy, including its
acquisition program, was successful during 1995. The Company
believes that this growth strategy will continue to be successful,
but the year-to-year results of this strategy will depend in part
on market conditions outside the Company's control. In addition,
the pace of the Company's acquisition program will reflect the
extent of opportunities available to the Company.

BUSINESS

Introduction

The Company is one of the largest direct suppliers of office
products to businesses in the United States and, beginning in 1996,
in Canada and the United Kingdom. The Company operates primarily
in two channels for the distribution of office products: the
contract stationer channel and the direct mail channel.

Throughout its 32-year history of operating in the contract
stationer channel, the Company's primary focus has been and remains
large business customers. The Company distributes a broad line of
branded and private label products for use in the office, including
consumable supplies, furniture, computer-related items and other
products. The Company's product line is offered through its annual
full line catalog and a variety of specialized catalogs, and sold
by the Company's direct sales force.

The Office Products Distribution Industry

The Company operates in a large, fragmented and rapidly
consolidating industry. The industry consists of three broad
channels for the distribution of office products directly to end
users:

The Contract Stationer Channel. Contract stationers
typically serve large- and medium-sized business customers
through product catalogs and sales forces, stocking products
in distribution centers and delivering them to customers on a
next-day basis against orders received electronically, by
telephone or fax, or taken by a salesperson on the customer's
premises. They typically enter into contracts with their
customers specifying prices for items the customers may order,
services to be provided and other terms. Major contract
stationers purchase directly from manufacturers, rely upon
wholesaler intermediaries to only a limited extent for
inventory backup and product breadth, and offer significant
volume-related discounts and a high level of service to their
customers. Historically, contract stationers operated in only
one or a very few major metropolitan areas. The Company has
been a significant exception. In recent years, principally
through acquisitions, several other major contract stationers
have emerged, each of which operates in a number of major
metropolitan areas.

The Direct Mail Channel. Direct marketers of office
products typically serve small- and medium-sized business
customers and home offices. While their procurement and order
fulfillment functions are similar to contract stationers, they
rely exclusively on catalogs and other database marketing
programs, rather than direct sales forces, to sell their
product offerings. Their operations are based upon large,
proprietary customer databases and sophisticated circulation
strategies drawn from consumer marketing that are used to
improve the effectiveness of catalog mailings to customers and
prospects.

The Retail Channel. Office products retailers typically
serve small- and medium-sized businesses, home offices and
individuals. For many years, the retail channel consisted
principally of a large number of independent retail dealers,
operating only one or a few relatively small stores in a
single local area and purchasing a limited inventory of office
supplies from wholesalers for resale at or near manufacturers'
list prices. During the last 10 years, the retail channel has
undergone significant change, primarily as a result of the
emergence and rapid growth of the retail office products
superstore companies. The superstore concept involves large
suburban strip mall and stand-alone stores which employ a
warehouse format, are typically open for business seven days
a week, stock a large number and broad range of items in
inventory, purchase in volume and typically take delivery at
their stores direct from manufacturers and offer many of their
products at discounts from manufacturers' list prices. Every
major metropolitan area in the United States is now served by
at least one, and most by several, retail office products
superstores.

The changes which have taken place in the office products
distribution industry in recent years have had a number of effects.
They have led to the emergence of several very large office
products distributors. They have blurred the lines between the
three principal distribution channels and increased the ability of
the major firms to operate across traditional channels and to serve
an increasingly greater part of the office products customer
spectrum. They have led to a rapid decline in the number of small
independent participants in the business, as a result of
acquisitions, various types of consolidations, and withdrawals.

Development of the Company

The Company entered the office products distribution industry
through acquisitions in 1963 and 1964 which established its
presence as both a contract stationer, which sold office products
directly to end users, and as a wholesale distributor, selling many
of the same products at wholesale to retail dealers who resold them
to end users. Thereafter, the business grew steadily in size and
geographic scope through a combination of start-ups and
acquisitions, some in the contract stationer channel and others in
the wholesale distribution channel.

In 1991, the Company's contract stationer channel sales were
$614 million and its wholesale channel sales were $425 million. At
the end of 1991, the Company had 12 contract stationer channel
distribution centers, 13 wholesale channel distribution centers and
five dual channel distribution centers. The simultaneous operation
of these wholesale and direct businesses, although both were
profitable, resulted in a variety of business and operational
complications and conflicts that restricted their growth. To
eliminate these complications and establish conditions which would
permit the accelerated growth of its contract stationer business,
the Company sold its wholesale distribution business in January
1992 to United Stationers, Inc. (formerly Associated Stationers,
Inc.).

The Company incurred substantial costs to reposition itself
following this divestiture, including the cost of separating the
operations of the two businesses, discharging certain post-closing
transitional obligations to United, and establishing new
distribution centers in areas where the Company previously operated
solely through the wholesale channel. The Company also continued
to incur certain fixed operating and overhead costs which after the
transaction were spread over a substantially reduced level of total
sales.

Following the sale of its wholesale business, the Company began
to execute its strategy to achieve accelerated growth in sales and
profitability (see "--Strategy for Growth"). In pursuit of that
strategy the Company, by the end of 1993, opened three start-up
distribution centers (Greenville, South Carolina; Orlando, Florida;
and Columbus, Ohio), and completed the acquisition of one existing
contract stationer (Minneapolis-St. Paul, Minnesota). During 1994,
the Company opened an additional start-up distribution center in
Denver, Colorado, and completed the acquisition of two more
existing contract stationers (Atlanta, Georgia, and Jacksonville,
Florida).

During 1994, the Company also purchased the net assets of the
direct mail business of Reliable for $71.3 million, with the intent
of expanding the Company's customer base. Reliable's targeted
customers are small- and medium-sized businesses and home offices,
a segment of the overall market which is growing more rapidly than
the large business customer segment served by the Company through
the contract stationer channel. The Company believes there are
significant operational and marketing synergies between the two
channels of its business which will also enable it to enhance the
Company's overall sales and profitability.

The pace of the Company's acquisitions accelerated beginning in
1995. Acquisitions completed in 1995 were located in Columbus,
Ohio; Norfolk, Virginia; Louisville, Kentucky; Cleveland, Ohio;
Boise, Idaho; Rochester, New York; St. Louis, Missouri; Tampa,
Florida; Pittsburgh, Pennsylvania; and Doncaster, England (as
described below). Acquisitions announced in 1995 and completed in
1996 include Grand & Toy Ltd., Canada's largest office products
distributor (as described below); Loring, Short and Harmon in
Portland, Maine; and McAuliffe's in Burlington, Vermont.
Additional 1996 acquisitions completed as of March 31, 1996 include
Sierra Vista in Albuquerque, New Mexico, and Office Essentials in
Milwaukee, Wisconsin. The combined annual sales at the time of
announcement of these acquisitions were $536 million.

In April 1996, the Company announced it had signed letters of
intent to acquire Crawford's Office Supplies, Inc., based in
Seattle, Washington; Zemlick Brothers, Inc., based in Kalamazoo,
Michigan; Bangs Office Products, Inc., based in Pocatello, Idaho;
and Pedersen Contact based in Melbourne, Australia. The combined
annual sales of these companies at the time of announcement were
$63.3 million. The Company also announced the start-up of new
office products distribution centers in Las Vegas, Nevada, and
Miami, Florida.

The Company has also sought to expand its business by entering
foreign markets. At year-end 1995, Reliable entered Great Britain
with the acquisition of Neat Ideas, U.K.'s second largest office
products direct marketer. On February 5, 1996, the Company
acquired Grand & Toy, Canada's largest contract stationer. The
purchase price was approximately C$140 million (US$104 million).
In addition the Company recorded liabilities of approximately $7.4
million, which are included in the recorded purchase price of Grand
& Toy, to modify and transition activities such as distributing,
marketing, and other functions. The acquisition was funded
primarily through borrowings under the Company's $225 million
Credit Facility. Grand & Toy operates six distribution centers and
approximately 80 retail stores across Canada. Sales for Grand &
Toy's fiscal year ended April 2, 1995, were C$281 million (US$205
million). Sales for its fiscal year ended March 31, 1996, were
C$322 million (US$237 million).

For a description of the Company's current distribution center
locations, see "--Properties."

Strategy for Growth

The Company has grown rapidly over the last few years. In 1995,
sales increased 45% compared with 33% in 1994, and 9% in 1993. The
increase in sales on a same-location basis was 26% in 1995, 15% in
1994, and 7% in 1993. The Company intends to continue to be a
major player in the rapidly consolidating office products
distribution industry. This is being accomplished through the
Company's four-part growth strategy, as follows:

Expand Through Acquisitions. The Company intends to continue
acquiring contract stationers in new locations where the
application of the Company's business model can accelerate the
acquired stationer's sales growth and maintain or improve its
profitability. The Company also considers acquisitions which
expand its presence in existing locations. The Company typically
seeks to retain management and to draw on its knowledge of the
local market while, at the same time, integrating the acquired
business into the Company's nationwide distribution network. In
those geographic areas where the Company desires to expand its
presence, but where no attractive acquisition candidates are
located, the Company anticipates developing start-up operations.
In addition, the Company intends to expand its office products
marketing and distribution capabilities in foreign countries as
appropriate opportunities arise.

Increase National Accounts. The Company believes there is
increasing recognition on the part of large multi-site businesses
in the U.S. and Canada of the efficiency and cost-effectiveness of
uniform system-wide purchasing of their office products
requirements. The Company also believes it currently has a
competitive advantage in its combination of nationwide coverage and
systems which provide consistent delivery of products, prices and
services. A key element of the Company's strategy is to expand its
sales to large customers having multiple offices. The Company has
added to its national account marketing and service teams so that
it can continue to increase its national account business.

The Company's sales to its national account customers in 1995
were $406 million compared with $246 million in 1994, and $189
million in 1993.

Broaden the Customer Base. The Company's growth strategy also
aims to expand its business with small- and medium-sized businesses
and home offices, a market segment which is growing more rapidly
than the large business customer segment, and cannot be
cost-effectively served through the direct sales force of the
contract stationer channel. In April 1994, the Company acquired
Reliable, the third largest direct mail distributor of office
products in the United States. Management believes that a direct
marketing operation such as Reliable's provides the most convenient
and cost-effective way for small- and medium-sized businesses to
purchase office products and that, over time, it will become the
preferred avenue for these customers to meet their office products
needs. At year-end 1995, Reliable entered Great Britain with the
acquisition of Neat Ideas, the U.K.'s second largest office
products direct marketer.

The Company also believes that operating and marketing synergies
exist between its two main distribution channels that can enhance
service and profitability. Operating synergies include
distribution center consolidation and utilization of a common order
fulfillment system that enhances Reliable's ability to provide
next-day delivery to its customers. Sales and marketing synergies
include database marketing, telemarketing and other outbound
marketing methods acquired through Reliable which may enable the
Company to leverage its direct sales force in the contract
stationer channel.

During 1995, Reliable's sales were $201 million. Sales for the
eight months Reliable was owned by the Company in 1994 were $105
million. Reliable's active customer list grew to 382,000 in 1995
compared to 282,000 in 1994.

Increase Sales of Existing Product Categories and Add New
Categories. A fourth component of the Company's growth strategy
involves increased sales of products to existing customers, both
through the sale of a broader array of product categories, such as
copier and fax paper and office furniture, and through the
introduction of new product categories, such as computer-related
items. As a result of these efforts to broaden the product mix
purchased by existing customers, the Company's sales of copier and
fax paper, measured by volume, increased by 60% in 1995 over 1994.
Similarly, office furniture has not been, until recently, a focus
of the Company's marketing efforts. A few of the Company's
locations have historically sold a substantial volume of office
furniture while most others have sold very little. The Company's
growth strategy targets office furniture, with the goal of
increasing its sale across the system, especially at those
locations where such sales have been modest.

Knowing that customers' needs for computer supplies, hardware,
software and peripherals were increasing rapidly, the Company
acquired WTS in September 1995. WTS, based in St. Louis, Missouri,
distributes computer-related products to businesses nationwide. As
a result of this acquisition, the Company is expanding its offering
of computer-related products across its distribution network.

The Company may offer additional product categories and services
in the future depending upon the needs of its customers.

Business Model

The Company's objective is to be the preferred supplier of
office products to business customers by outperforming competitors
at all levels--to "out-national" its national competitors and
"out-local" its local competitors. To achieve this, the Company's
business model is designed to take maximum advantage of both the
Company's centralized national capabilities and its local presence
in major markets across the country. The Company manages centrally
where it is cost-effective to do so or there is value to its
customers in nationwide consistency, and manages locally where it
is responsive to local market needs and opportunities or local
customer requirements.

Each distribution center in the Company's nationwide network is
linked through a common computer system with the Company's
headquarters and with all other distribution centers. This system
facilitates the delivery of consistent products, pricing, services
and reporting to the Company's many national account customers. It
also enables the Company to centralize certain administrative,
logistical and other management functions to reduce operating
costs. For example, the Company is able to monitor inventory
levels and forecast future demand for each stocked item at each of
its distribution centers. As a result, the responsibility for
rebuying common items is now a headquarters function.

The Company's merchandising activities are centralized,
including product selection, catalog preparation, and vendor
selection, management and evaluation. Sales training, marketing
programs, activity-based cost management programs, accounting,
logistics and human resources management are other functions that
are primarily or totally performed centrally and thus can benefit
from economies of scale as the Company grows. In addition to
providing customer service presence in each distribution center for
the benefit of location-specific needs, the Company operates
central call centers to enter customer orders and respond to
customer inquiries about product alternatives, order status,
billing and other matters. Again, the Company's integrated
computer system enables the Company to organize these and other
customer support functions in a centralized, cost-effective manner
without compromising customer focus. This dual objective of
customer service that is both responsive and cost-effective
requires an appropriate balance between centralization and local
autonomy.

The Company believes that a local distribution center presence
is important to many contract stationer customers and can provide
a competitive advantage within a specific metropolitan area. Each
distribution center is a profit center; its general manager is
responsible for local account targeting, pricing and servicing,
distribution center productivity, sales management and location-
specific or customer-specific products and services, alliances and
promotions. In each local market, the Company's business model
draws on the local market knowledge of its management team and
sales representatives to develop and offer customized services --
from stocking customer-unique products to special reporting and
delivery services.

The Company's business model is data intensive. Through its
activity-based cost system (ABCM), the Company measures its costs
by activity, and then by customer and by product. ABCM facilitates
cost comparisons across all distribution centers so that "best
practices" can be identified at one location and replicated at all
locations where appropriate. Other important measurements include
on-time delivery, order accuracy and completeness, supplier
performance by location, customer satisfaction, associate
satisfaction, and key process stability and capability. Management
believes that these measurement systems, including its ABCM model,
provide the Company with a competitive advantage.

Products

The Company offers a broad line of branded products for use in
the office, generally at substantial discounts from manufacturers'
list prices. In addition to brand name products, the Company
offers under its Cascade(R) private label items manufactured to its
specifications, including copier paper, legal pads, envelopes and
file folders. The Company is also able to supply in excess of
10,000 items from the catalogs of office product wholesalers.

For the periods presented, the Company's net sales by product
category, expressed as a percentage of its total contract stationer
channel sales, were as follows:

<PAGE>
Year Ended December 31,
1993 1994 1995

Office supplies (1) . . . . . . 79.3% 78.7% 80.0%
Office furniture (2). . . . . . 9.4 9.2 9.2
Other products (3). . . . . . . 11.3 12.1 10.8
_____ _____ _____
100.0% 100.0% 100.0%

(1) Includes pens, staplers, file folders, binders, copier and fax
paper, envelopes, tablets, calculators and computer-related
products, among many other items.

(2) Includes desks, chairs, file cabinets, computer stations and
furniture accessories.

(3) Includes lunchroom supplies, janitorial supplies and special
items, such as custom imprinted pens and notebooks.

The Company's product line is offered through its annual full-
line catalog, which is designed to assist the customer in ordering
products. In addition to its full-line catalog, the Company
periodically distributes limited-line or specialty catalogs.

The Company has developed the software for, and is currently
marketing a CD-ROM version of, its full-line catalog which was
available to customers in the spring of 1995. Interactive features
of the CD-ROM catalog will provide customers, by computer, with the
same information on each item which is contained in the printed
version of its catalog and will also permit a customer to view
complementary items, see prices specific to that customer and order
electronically. The development of this electronic catalog is part
of the Company's overall program of providing expanded
opportunities for electronic data interchange with its large
business customers.

Product selection for the Company's catalogs is performed
centrally. The Company utilizes computerized system applications
to review the sales and gross margin of each item in the full-line
catalog, polls customers concerning their product preferences and
evaluates new product offerings.

Contract Stationer Marketing

Large business customers constitute the principal class served
by the Company through the contract stationer channel. The Company
typically enters into contracts with its large business customers.
Each contract generally includes an agreed upon list of prices for
the customer's most frequently ordered items which may be
guaranteed by the Company for a specified period of time. The
contract may also offer the customer other items contained in the
Company's full-line catalog at prices which are generally higher
than the contract items but still below the manufacturer's list
prices and which are typically adjusted quarterly. The term of the
contract usually ranges from six months to two years, and is
typically cancelable by the customer on 30 days' notice. The
Company normally obtains price commitments from its vendors
sufficient to cover its exposure on guarantees of product prices
which it makes to its customers.

A major category of the Company's contract stationer customers
is its national accounts, large business customers, which the
Company serves at multiple office sites, from at least two
different distribution centers, pursuant to a centrally negotiated
national contract which provides for consistent prices and service
across all such sites. The Company has a specialized marketing
team, which, working in coordination with sales representatives at
the Company's distribution centers, is dedicated to procuring and
servicing national account customers. At December 31, 1995, the
Company had 381 national account customers, compared to 266 at
December 31, 1994, and 163 at December 31, 1993.

The Company offers a wide range of order entry options to its
business customers. A customer wishing to place an order with the
Company may: (i) give the order in person to a sales associate;
(ii) convey the order by telephone or facsimile transmission to a
customer service representative at its local distribution center
or, using an "800" number, at a central customer service facility;
(iii) enter the order electronically via a touch-tone telephone key
pad; or (iv) enter the order by using a personal computer or other
computer interface, the fastest growing segment of the Company's
order entry options.

Direct Mail Marketing

In the direct marketing channel, Reliable, which the Company has
operated as a wholly-owned subsidiary since April 1994, supplies
office products principally to small- and medium-sized businesses
and to home offices and individuals throughout the United States,
through direct marketing catalogs and programs. Reliable offers a
broad line of over 9,300 branded and 300 private label products for
office use, most at substantial discounts from manufacturers' list
prices, through frequent mailings of a variety of general and
specialized full-color product catalogs. It stresses customer
service, including convenient and efficient order placement and
prompt order fulfillment and fast delivery.

The Company believes that direct marketing provides the most
convenient and cost-effective way for small and medium-sized
businesses and home office customers to purchase office products.
The customer receives a catalog in the mail, places his order by
toll-free telephone or fax, and receives delivery of the order on
the next or second business day. The Company believes that the
direct mail operations of Reliable compete effectively against the
office products superstores and small retail dealers for the
business of their targeted customers, thereby enabling the customer
to avoid the time and cost associated with store visits and the
need to transport purchased merchandise from the store to the
customer's premises.

Reliable markets its product offering to both existing and
prospective customers through its full-line and monthly sale
catalogs, and specialty catalogs for the home office, furniture,
computer supplies and seasonal products. A key element of
Reliable's marketing strategy is its use of database marketing
techniques to analyze the purchasing patterns of its customers and
to determine the content and timing of future catalog mailings.
These techniques are also used to identify prospective customers
and to determine the catalog content of mailings to them.

Reliable's marketing strategy is designed to retain and
stimulate additional purchases from existing customers and to
attract new customers. At the time of its acquisition by the
Company at the end of April 1994, Reliable had approximately
259,000 active customers (a customer which has made at least one
purchase during the preceding 12 months). At December 31, 1995,
Reliable's total number of active customers was approximately
382,000, an increase of 47% since its April 1994 acquisition. This
increase resulted from a combination of accelerated prospecting for
new customers, improved customer list management and increased
retention of existing customers. In short, the appropriate and
rigorous application of database marketing techniques.

Ease in ordering is a key component of Reliable's customer
service. To facilitate order placement and entry, Reliable
maintains 24-hour, 7-day-a-week, toll-free "800" numbers for
ordering by telephone or fax. These are linked to a central order
reception and customer service center at Ottawa, Illinois where
customer service associates receive orders and utilize on-line
terminals to enter them into Reliable's computerized order
processing system, electronically perform a credit check and, if
credit is approved, transmit each order to the appropriate
distribution center based upon a pre-programmed ordering system
which utilizes customer zip codes and other factors to assure rapid
fulfillment and delivery. Approximately four out of five of
Reliable's orders are placed by telephone and the balance by fax or
mail.

Reliable operates strategically located distribution centers
which receive and store inventory and fill customer orders.
Reliable's distribution center network enables it to offer next-day
delivery to customers located in specified zip codes. Under
Reliable's stocking strategy, each of its distribution centers
maintains a complete inventory of the products offered by Reliable
other than oversized items, such as large furniture, and higher
priced electronic items.

At year-end 1995, Reliable entered Great Britain with the
acquisition of Neat Ideas, the U.K.'s second largest office
products direct marketer.

Operations

Contract Stationer and Direct Marketing Channel Synergies.
During the months the Company has owned Reliable, several important
synergies have been identified between the Company's contract
stationer operations and its Reliable direct marketing operations.
Currently the Company is taking advantage of Reliable's database
marketing tools and centralized call center management skills, for
example, in its contract stationer operations. Administrative and
operations support departments have been combined where
appropriate. Some of the Company's contract stationer distribution
centers now fulfill orders under contract with Reliable, improving
Reliable's next-day delivery coverage to 65% as of December 31,
1995, and with the prospect of providing significantly higher
coverage by utilizing more of the Company's existing contract
stationer distribution centers.

Logistics and Systems Support. Advanced information technology
is critical in a nationwide distribution business involving many
thousands of different items used to fill orders under tight time
constraints. The Company was a pioneer in the use of computer
systems to facilitate this process. It has developed and uses
customized software applications to carry out or assist in
performing a great variety of business functions. These functions
include, among many others, order entry, order processing,
receiving, storing and "picking" inventory, routing delivery
vehicles, measuring productivity and transaction quality,
generating customized reports, preparing accounting statements and
tracking product and customer data.

To provide additional systems flexibility and capacity for the
future, the Company is converting its principal computer network
from a mainframe to a distributed system. The system employs a new
software applications package developed by and licensed from an
outside contractor which specializes in distribution companies.
The software is a combination of pre-existing modules and custom
applications developed specifically for the Company.

Stocking, Order Fulfillment and Delivery. The Company's
distribution centers receive and store inventory and fill customer
orders. Most of the Company's distribution centers regularly stock
all of the items offered in its full-line catalogs. The Company's
stocking strategy at each distribution center is designed to ensure
its ability to provide next-day delivery of all catalog items to
its customers at the lowest cost and, therefore, reflects a
rigorous economic tradeoff between carrying a particular item in
inventory at a particular center or sourcing it from a nearby
center or from a wholesaler.

Orders received during the day are picked, packed and assembled,
using a variety of highly automated equipment. This is performed
at the appropriate regional distribution center for delivery the
following day to customers within the next day regional service
area for that center. Depending on population density and other
logistical factors, the next day service area of a given
distribution center can cover an area of up to a 400-mile radius
from the distribution center. Based on an optimized route
structure allowing the Company to schedule specific vehicles and
delivery times, the Company's software can determine the optimal
sequence in which orders are to be loaded onto vehicles which may
be either owned or leased by the Company or operated by common or
contract carriers, depending on the cost effectiveness of each
alternative.

Procurement. The Company's computer system monitors inventory
levels and forecasts future demand for each item which the Company
stocks and, based thereon, recommends the timing and amount of such
items to be "rebought" by the Company. The Company's inventory
turns have increased to 9.7 times in 1995, from 8.7 in 1994 and 7.6
in 1993.

While vendor selection is done centrally by the Company, the
timing and terms of buying and rebuying decisions from such vendors
are currently determined on a decentralized basis by each of the
Company's distribution centers. However, as part of its computer
system conversion (see "--Operations--Logistics and Systems
Support"), the Company is centralizing the buying and rebuying
function for those items most frequently ordered by its customers,
which the Company believes will contribute to more efficient
purchasing decisions and lower procurement costs.

To assist the Company in making vendor selection decisions and
in reducing inventory cost, the Company has developed and now uses
a detailed vendor management and evaluation program. This program
enables the Company's central purchasing staff to measure the
performance of each of the Company's vendors in a number of areas
and then evaluate them based upon such measurements.

Employees

At December 31, 1995, the Company had a total of 4,757 full- and
part-time employees ("associates"), 1,953 of whom were employed
primarily in marketing and sales, order processing and customer
service, 1,708 at its distribution centers in inventory receipt and
storage and order filling and as drivers of delivery vehicles, and
1,096 in other operations, management and administration.
Part-time employees supplement the Company's associates in customer
service and order filling during those periods each day when there
are surges in incoming calls and outgoing orders.

The Company's direct sales staff consists of sales associates
assigned to specific accounts at each of its distribution centers
and district sales managers who manage groups of such sales
associates. The Company also utilizes a national account marketing
team described above under "--Contract Stationer Marketing" and
certain product marketing specialists.

The Company carries on an intensive, on-going training program
for all of its sales associates, involving programs at the
Company's national headquarters and at the distribution center to
which each associate is assigned. These programs include training
in both core selling skills and the Company's segmentation analysis
and ABCM System. Intensive training is also provided on an
as-needed basis for the sales representatives associated with newly
acquired operations as part of the integration of their sales and
marketing efforts into the Company's model. The Company also
conducts an annual training program for its district sales
managers.

Competition

The Company faces a highly competitive environment in each of
the office products distribution channels in which it operates.
Competition is based principally on price, service and customer
relationships. An important aspect of the Company's ability to
compete for multi-site customers in the contract stationer channel
is its ability to deliver consistent products, prices and service
across all customer sites.

In the contract stationer channel the Company has experienced
increased competition in recent years due primarily to the
emergence of several other large participants seeking to establish
national distribution networks similar to that of the Company. The
Company's major competitors in this channel are BT Office Products
USA (a division of a large Dutch company), Corporate Express,
Office Depot, U.S. Office Products and Staples. A number of these
participants, which include some of the major retail superstore
companies, have grown, principally through the acquisition of local
or regional contract stationers, at rates significantly faster than
the Company's rate of growth prior to 1994. Some of the Company's
competitors have greater financial resources and purchasing power
than the Company. The contract stationer operations of the major
superstore companies also benefit from their national advertising
and franchising programs. The Company also competes with smaller
local and regional contract stationers, many of which have
longstanding customer relationships.

In the direct mail channel, which accounted for approximately
15% of the Company's 1995 net sales, the Company's principal
competitors are the two other major direct mail office products
distributors, Viking and Quill, the retail superstore companies
(including Office Depot, OfficeMax and Staples) and, to a lesser
extent, local retail dealers.

The major superstore companies also compete with firms operating
in both the direct mail channel and the contract stationer channel
as they increasingly target medium-sized business customers by
offering delivery service and utilizing direct mail programs to
send catalogs to potential customers.

Environmental Matters

The Company is subject to federal, state and local laws,
regulations and ordinances which govern and regulate activities
which might have adverse environmental effects, such as discharges
to air and water, as well as the handling and storage of hazardous
wastes. None of the Company's facilities typically engage in
activities or generate discharges of the types generally covered by
these laws and regulations or any hazardous waste materials. The
Company believes it is in substantial compliance with all such laws
and regulations which are applicable to it.

The Company is also subject to federal laws and regulations
which impose liability for the costs of cleaning up, and certain
damages resulting from, sites of past spills, disposals or other
forms of environmental damage, including those which might have
occurred prior to ownership of particular sites by the Company.
The Company is currently not aware of any environmental conditions
at any of the sites which it operates which, individually or in the
aggregate, would be likely to have a material adverse effect on the
financial condition or results of operations of the Company.
However, there can be no assurance that any such environmental
liabilities in the future will not have a material adverse effect
on the financial condition or results of operations of the Company.

Properties

The Company's corporate headquarters, together with its Chicago
metropolitan area distribution center, are located in a combined
facility owned by the Company at 800 W. Bryn Mawr Avenue in Itasca,
Illinois, a suburb northwest of Chicago. As of March 31, 1996, the
Company operated 46 distribution centers, which are described on
the following pages.

Company Distribution Centers as of January 1, 1995

Approximate
Occupancy Square
Location Status Footage

United States
Phoenix, Arizona. . . . . . . . . . . . . . Owned 97,700
Los Angeles (Garden Grove), California. . . Leased 188,300
San Francisco (Menlo Park), California. . . Owned 218,000
Denver, Colorado. . . . . . . . . . . . . . Leased 12,300
Hartford (Naugatuck), Connecticut . . . . . Leased 41,700
Washington, (Elkridge, Maryland) D.C. . . . Leased 118,900
New Castle, Delaware. . . . . . . . . . . . Leased 119,700
Orlando, Florida. . . . . . . . . . . . . . Leased 43,200
Atlanta (Smyrna), Georgia . . . . . . . . . Owned 128,000
Stone Mountain, Georgia . . . . . . . . . . Leased 72,600
Honolulu, Hawaii (1). . . . . . . . . . . . Owned/Leased 75,000/55,900
Chicago (Itasca and Lansing), Illinois (2). Owned/Leased 467,300/267,100
Boston (Billerica), Massachusetts (2) . . . Owned/Leased 75,200/21,600
Detroit (Warren), Michigan. . . . . . . . . Owned 154,500
Minneapolis/St. Paul (Golden Valley),
Minnesota . . . . . . . . . . . . . . . . Leased 47,900
Kansas City, Missouri . . . . . . . . . . . Owned 53,800
Reno Nevada . . . . . . . . . . . . . . . . Leased 100,000
New York (Carldstadt, New Jersey),
New York. . . . . . . . . . . . . . . . . Leased 117,800
Columbus, Ohio. . . . . . . . . . . . . . . Leased 51,300
Portland, Oregon. . . . . . . . . . . . . . Leased 110,000
Philadelphia (Bristol), Pennsylvania. . . . Owned 111,500
Greenville, South Carolina. . . . . . . . . Leased 40,000
Dallas (Garland), Texas . . . . . . . . . . Leased 88,300
Houston, Texas. . . . . . . . . . . . . . . Leased 56,000
Salt Lake City, Utah. . . . . . . . . . . . Leased 24,600
Seattle (Kent), Washington. . . . . . . . . Owned 161,000
<PAGE>
Company Acquisitions Completed in 1995

Approximate
Occupancy Square
Location Status Footage

United States
Tampa, Florida. . . . . . . . . . . . . . . Leased 19,600
Boise, Idaho. . . . . . . . . . . . . . . . Leased 13,900
Louisville, Kentucky. . . . . . . . . . . . Leased 61,750
St. Louis, Missouri . . . . . . . . . . . . Owned 49,500
Rochester, New York (2) . . . . . . . . . . Leased 32,600/42,400
Cleveland (Independence), Ohio. . . . . . . Leased 37,000
Pittsburgh, Pennsylvania (2). . . . . . . . Leased 72,500/24,000
Norfolk, Virginia . . . . . . . . . . . . . Leased 51,200

United Kingdom
Doncaster, England. . . . . . . . . . . . . Leased(3) 70,500

Company Acquisitions Completed in 1996
(Through March 31, 1996)

Approximate
Occupancy Square
Location Status Footage

United States
Portland, Maine . . . . . . . . . . . . . . Leased 30,000
Albuquerque, New Mexico . . . . . . . . . . Leased 57,100
Burlington, Vermont . . . . . . . . . . . . Leased 100,600
Milwaukee (New Berlin), Wisconsin . . . . . Leased 20,000

Canada (4)
Calgary, Alberta. . . . . . . . . . . . . . Owned 40,000
Vancouver, British Columbia . . . . . . . . Leased 51,100
Winnipeg, Manitoba. . . . . . . . . . . . . Owned 30,000
Ottawa, Ontario . . . . . . . . . . . . . . Owned 32,000
Toronto (Don Mills and Bermondsey),
Ontario (2) . . . . . . . . . . . . . . . Owned 142,000/170,000
__________________________

(1) Consists of three owned facilities located on the islands of
Oahu, Maui and Hawaii and two leased facilities on the islands
of Oahu and Kauai. The Company also leases and operates three
retail stores on the island of Oahu.

(2) Consists of two facilities.

(3) Subject to a long leasehold, with a lease term in excess of 50
years.

(4) With the acquisition of Grand & Toy, the Company also operates
approximately 80 retail stores throughout Canada.

The Company leases office space in Ottawa and LaSalle, Illinois
for central telephone calling centers. The Company also maintains
sales offices in various locations for use in its contract
stationer operations. These serve as a base of operations for
sales associates assigned to sales territories served by particular
distribution centers. All such offices are leased and none exceeds
2,000 square feet in size.

The lease terms for the Company's leased distribution centers
expire between 1996 and 2001.

Legal Proceedings

The Company is involved in litigation and administrative
proceedings primarily arising in the normal course of its business.
In the opinion of management, the Company's recovery, if any, or
the Company's liability, if any, under any pending litigation or
administrative proceeding would not materially affect its financial
condition or operations.

<PAGE>
MANAGEMENT

Executive Officers and Directors

Name Age Position

Peter G. Danis Jr.(1) . . . . . . . 64 President, Chief Executive
Officer, and Director
Christopher C. Milliken(2). . . . . 50 Senior Vice President, Operations
Carol B. Moerdyk(3) . . . . . . . . 45 Senior Vice President, Chief
Financial Officer and Treasurer
Richard L. Black. . . . . . . . . . 50 President, Reliable Corporation
Lawrence E. Beeson . . . . . . . . 52 Vice President, Marketing
Julie M. Cade . . . . . . . . . . . 44 Vice President and Region Manager
Darrell R. Elfeldt. . . . . . . . . 52 Vice President and Controller
John A. Love. . . . . . . . . . . . 55 Vice President, Human Resources
Stephen M. Thompson . . . . . . . . 53 Vice President and Region Manager
A. James Balkins III(4) . . . . . . 43 Corporate Secretary
George J. Harad . . . . . . . . . . 51 Chairman of the Board and
Director
John B. Carley(5)(6). . . . . . . . 62 Director
James G. Connelly III(5)(6) . . . . 50 Director
Theodore Crumley. . . . . . . . . . 50 Director
A. William Reynolds(6). . . . . . . 53 Director

___________________________

(1) Executive Vice President and General Manager, Office Products
Distribution, BCC.

(2) Vice President, Operations, Office Products Distribution, BCC.

(3) Vice President, Finance, Office Products Distribution, BCC.

(4) Vice President, Associate General Counsel and Corporate
Secretary, BCC.

(5) Member of the Audit Committee and the Committee of Independent
Directors.

(6) Member of the Compensation Committee.

The Board of Directors consists of three classes, which serve
staggered three-year terms. Class I, the terms of whose members
expire in 1999, is comprised of Messrs. Crumley and Reynolds.
Class II, the terms of whose members expire in 1997, is comprised of
Messrs. Danis and Connelly. Class III, the terms of whose members
expire in 1998, is comprised of Messrs. Harad and Carley.
Directors hold office until their successors are elected and
qualified.

Peter G. Danis Jr. was named President and Chief Executive
Officer of the Company as part of the Organization and served as
Executive Vice President and General Manager, Office Products
Distribution Division of BCC since 1993. Prior thereto, Mr. Danis
served in various capacities at BCC including Executive Vice
President, Office Products and Building Products from 1989 to 1993,
Senior Vice President from 1981 to 1989, and Vice President, Office
Products from 1977 to 1981.

Christopher C. Milliken was named Senior Vice President,
Operations of the Company as part of the Organization and served as
a Region Manager of the Division since 1991. He has served in
various positions with the Division since 1977.

Carol B. Moerdyk was named Senior Vice President, Chief
Financial Officer and Treasurer of the Company as part of the
Organization and served as Vice President and Assistant to the
General Manager of Office Products of BCC since 1992. Previously,
Ms. Moerdyk served in various capacities at BCC including Vice
President, Corporate Planning and Development from 1990 to 1992 and
Corporate Planning and Development Director from 1986 to 1990.

Richard L. Black became President of The Reliable Corporation,
a wholly-owned subsidiary of the Company, in 1994. Mr. Black
served as Vice President, Marketing of Rivertown Trading Company
from 1992 to 1994 and, prior thereto, as Vice President, New
Business Development of Fingerhut Corporation, both direct
marketing companies.

Lawrence E. Beeson was named Vice President, Marketing of the
Company as part of the Organization and assumed his
responsibilities at the Company on April 1, 1995. Prior to joining
the Company, he had served as Vice President -- Marketing of
Hallmark Cards, Inc. from 1990 to March 1995 and as Senior Vice
President, Marketing for KFC Corp., a subsidiary of Pepsico Inc.,
prior thereto.

Julie M. Cade was named Vice President and Region Manager of the
Company as part of the Organization and served as a Region Manager
of the Division since 1992. Ms. Cade has served in various
capacities with the Division since 1977.

Darrell R. Elfeldt was named Vice President and Controller of
the Company as part of the Organization and served as Finance and
Distribution Director of the Division since 1993. Mr. Elfeldt has
served in various positions with the Division since 1980.

John A. Love was named Vice President, Human Resources of the
Company as part of the Organization and served as the Human
Resources Director since he joined the Division in 1978.

Stephen M. Thompson was named Vice President and Region Manager
of the Company as part of the Organization and served as a Region
Manager of the Division since 1976. Mr. Thompson has served with
the Division since 1970.

George J. Harad was elected Chairman of the Board of Directors
of the Company as part of the Organization. Mr. Harad is Chairman
of the Board and Chief Executive Officer of BCC and has been an
executive officer of BCC since 1982. Mr. Harad also serves as a
director of Allendale Insurance Co.

John B. Carley was elected a director of the Company as part of
the Organization. Mr. Carley is a director, chairman of the
Executive Committee of the board of directors, and former President
and Chief Operating Officer of Albertson's Inc., a retail food and
drug company. He has been an executive officer of Albertson's
since 1973. Mr. Carley is also a director of Idaho Power Company.

James G. Connelly III was elected a director of the Company as
part of the Organization. Mr. Connelly is a director and President
and Chief Operating Officer of Caremark International Inc.
("Caremark"), a national provider of health care management and
services, and has served Caremark in that capacity since 1992.
From 1990 to 1992, Mr. Connelly was a group vice president of
Baxter International Inc. ("Baxter"), a manufacturer and marketer
of health care products. Prior thereto, Mr. Connelly was a
corporate vice president of Baxter, responsible for its hospital
supply business group.

Theodore Crumley was elected a director of the Company as part
of the Organization. Mr. Crumley is currently Senior Vice
President and Chief Financial Officer of BCC and has been an
executive officer of BCC since 1990. Mr. Crumley has served in
various positions with BCC since 1973. Mr. Crumley is also a
director of Hecla Mining Company.

A. William Reynolds was elected a director of the Company as
part of the Organization. Mr. Reynolds is currently the Chief
Executive of Old Mill Group, a private investment firm. He is the
former chairman of the board and chief executive officer of GenCorp
Inc., a diversified manufacturing and service company.
Mr. Reynolds is a director of BCC, Eaton Corporation, and Stant
Corporation, and chairman of the Federal Reserve Bank of Cleveland.

Messrs. Danis and Milliken and Ms. Moerdyk continue to be
executive officers of BCC, although they are employees of the
Company and devote all of their business time to the affairs of,
and are compensated only by, the Company.

Committees

The Company's Board of Directors has a Committee of Independent
Directors, composed of two members, neither of whom is an officer,
employee, or former officer of the Company or a director or officer
of any corporation holding more than 10% of the voting shares in
the capital of the Company. This Committee is responsible for
reviewing and approving the terms of all material agreements and
transactions between the Company and any corporation holding more
than 10% of the voting shares in the capital of the Company. The
Committee also reviews and evaluates any significant related party
transactions between the Company and any officer, director or
principal shareholder. The Committee chair is Mr. Carley and its
other member is Mr. Connelly. During 1995, this Committee held two
meetings.

The Board of Directors has a Compensation Committee composed of
the Company's nonemployee directors, none of whom is an executive
officer of another company on whose board of directors any
executive officer of the Company serves or an officer, employee or
former officer of any corporation holding more than 10% of the
voting shares in the capital of the Company. The Compensation
Committee is responsible for establishing all executive officer
compensation and for administering stock option and variable
compensation programs applicable to directors and officers. The
committee chair is Mr. Reynolds and its other members are
Messrs. Carley and Connelly. During 1995, this Committee held four
meetings.

The Board of Directors has an Audit Committee composed of two
members, neither of whom is an officer, employee or former officer
of the Company or a director or officer of any corporation holding
more than 10% of the voting shares in the capital of the Company.
The Committee meets periodically with management, BCC's Internal
Audit staff, and representatives of the Company's independent
auditors to ensure that appropriate audits of the Company's affairs
are being conducted. In carrying out these responsibilities, the
Committee reviews the scope of internal and external audit
activities and the results of the annual audit. The Committee is
also responsible for recommending a public accounting firm to serve
as independent auditors each year. Both the independent auditors
and the internal auditors have direct access to the Audit Committee
to discuss the results of their examinations, the adequacy of
internal accounting controls, and the integrity of financial
reporting. The Committee chair is Mr. Connelly and its other
member is Mr. Carley. During 1995, this Committee held one
meeting.

Compensation of Directors

Cash Compensation

Directors, except those who are also employees of the Company or
of BCC, are paid an annual retainer of $10,000 plus a fee of $1,000
for each board meeting which a director attends, including
committee meetings held the same day, and for each committee
meeting held on a day other than the board meeting date. The
directors are reimbursed for travel and other expenses related to
attendance at such meetings.

Director Stock Option Plan

In 1995, the Board of Directors of the Company adopted the
Director Stock Option Plan ("DSOP"). Under the DSOP, each
individual who is not an employee of the Company or BCC will
receive a stock option grant each July 31. Directors elected
between August 1 and December 31 will also receive a grant when
they are elected to the Board. On April 6, 1995, each of the
Company's nonemployee directors was granted an option to purchase
4,000 shares of Common Stock at the initial public offering price
for the shares. The options became exercisable one year following
the date of grant, and they expire the earlier of (a) three years
following the director's retirement, resignation, death or
termination as a director of the Company or (b) ten years after the
grant date. The DSOP was approved in February 1995 by BCC, the
Company's sole shareholder at that time.

Nonemployee Director Deferred Compensation Program

The Company has adopted a deferred compensation program for
nonemployee directors. Under this program, a nonemployee director
may defer from a minimum of $5,000 to a maximum of 100% of his
director's cash compensation in a calendar year, and interest
accrues on these accounts at a rate equal to 130% of Moody's
Composite Average of Yields on Corporate Bonds. The program
provides a minimum death benefit equal to 1.5 times a participant's
total expected deferrals for the period February 14, 1995, through
December 31, 1995, up to a maximum of $500,000. Benefits under
this program are not funded but are paid out of the Company's
general assets. Participants in the program are unsecured general
creditors of the Company with respect to these benefits. As of
December 31, 1995, all three eligible directors were participating
in the deferred compensation program.

Executive Compensation

Key Executive Performance Plan

On February 20, 1995, the Board of Directors of the Company
adopted, and BCC as the then sole shareholder approved, the Key
Executive Performance Plan ("KEPP"), a variable incentive
compensation program for its executive officers and other key
executives. On April 23, 1996, the Company's shareholders approved
the KEPP at their annual meeting. Under this program, a
significant percentage of participants' compensation is payable
only upon attainment of specified levels of performance by the
Company. This program may also take into account the financial
performance of the Company's divisions or locations, as well as
certain nonfinancial performance criteria (for example,
improvements in safety, improvements in operating efficiency, etc.)

Under the KEPP, the Company's financial performance may be
measured under one or more different objective corporate
performance criteria, including economic value added ("EVA"(R)),
return on equity, net income after taxes, earnings per share, or
return on total capital. In addition, the Company's performance
may also be measured under several region or location performance
criteria including, but not limited to, division or location pretax
return on total capital, EVA(R), operating efficiency, sales, and
product mix. These performance criteria are more fully defined in
the plan document. The Compensation Committee of the Board of
Directors selects one or more of these criteria and establishes a
mathematical formula in accordance with which a specified
percentage of a participant's salary may be paid as an award under
the plan upon the attainment by the Company, and/or a division or
location, of certain levels of performance, as measured by the
selected criteria. No more than $2,500,000 may be paid to a
participant in the KEPP in any year. In the event an award earned
under the performance criteria in effect for a year would exceed
this limit, the amount in excess of the limit will be automatically
deferred in accordance with the plan.

Under the KEPP, participants may elect to defer receipt of all
or a portion of awards earned; amounts so deferred become unfunded
general obligations of the Company. Because the plan is designed
to provide participants with, among other things, the opportunity
to defer receipt of income until their retirement, the plan is
subject to regulation under the federal Employee Retirement Income
Security Act of 1974. All nine of the Company's executive officers
participate in the KEPP, and 56 other nonofficer employees are also
currently participating in the plan.

The amounts that will be paid pursuant to the plan for 1996 are
not currently determinable. The following table describes the
amounts which were paid under the plan for 1995 to each of the
Named Executive Officers (as hereinafter defined in the Summary
Compensation Table on page 35), the executive officers as a group,
and the nonofficer employees as a group. Since the payments under
this plan will relate directly to the Company's financial
performance, the actual payments for 1996 may be significantly
different than the amounts shown on the following page. The
figures reported in this table are also reported under the column
heading "Bonus" in the Summary Compensation Table on page 35.

<PAGE>
1995 KEY EXECUTIVE PERFORMANCE PLAN BENEFITS

Name Dollar Value ($) No. of Units
Peter G. Danis Jr.. . . . . . . . $ 398,762 N/A
Richard L. Black . . . . . . . . 157,054 N/A
Christopher C. Milliken . . . . . 158,094 N/A
Carol B. Moerdyk. . . . . . . . . 158,094 N/A
Lawrence E. Beeson. . . . . . . . 128,192 N/A
Executive officers as a group . . 1,383,601 N/A
Nonofficer employees as a group . 2,681,699 N/A

Amounts received by participants under the KEPP are subject to
income taxation in the year received. The Company is entitled to
deduct, as compensation expense, amounts paid to participants
pursuant to the plan. The Compensation Committee of the Board of
Directors has responsibility for administration and interpretation
of the plan. The Committee may amend or terminate the plan, at its
sole discretion, at any time. Participants who terminate their
employment with the Company voluntarily or involuntarily, with or
without cause, will generally not be eligible to receive an award
under the KEPP for the year in which they terminate. Participants
who retire, become totally disabled, die or terminate employment
involuntarily as a direct result of the sale or permanent closure
of a division or facility of the Company or as a direct result of
a merger, reorganization, sale or restructuring of all or part of
the Company may receive a prorated award under the plan for the
year in which their employment terminates.

Key Executive Stock Option Plan

On February 20, 1995, the Company adopted, and BCC as the then
sole shareholder approved, a Key Executive Stock Option Plan (the
"Stock Option Plan"). On April 23, 1996, the Company's
shareholders approved the Stock Option Plan at their annual
meeting. In order to meet the changing needs of employees under
varying economic conditions and changing tax laws, the Stock Option
Plan is designed to permit flexibility in the types of options
which may be granted from time to time. Options granted under the
plan may be either nonstatutory stock options ("NSOs") or incentive
stock options within the meaning of Section 422A of the Internal
Revenue Code ("ISOs"). Among other items, the Compensation
Committee fixes the date of the grant, the duration of the option,
the number of shares subject to the option, vesting requirements
and rights of optionees upon termination. The exercise price of
all options granted under the Stock Option Plan cannot be less than
the fair market value of the shares of the Company's Common Stock
on the date of the grant.

The Stock Option Plan will remain in effect until all stock
subject to options has been purchased or the options expire. Under
the Stock Option Plan, no options may be granted after February 20,
2005, and no options may be granted to a single participant in
excess of 20% of the total number of shares reserved for issuance
under the Stock Option Plan. Approximately 70 Company employees
are expected to participate in the Stock Option Plan each year.

A maximum of 3,000,000 shares of Common Stock may be issued
pursuant to the exercise of options granted under the Stock Option
Plan. The Stock Option Plan may be amended by the Compensation
Committee at any time. However, shareholders must approve any
amendment which (i) increases the total number of shares that may
be purchased through options granted under the plan, (ii) changes
the eligibility requirements, (iii) changes the provisions
regarding grant price, or (iv) materially increases the benefits to
participants or cost of the plan to the Company.

Under current federal tax law, an optionee will not be subject
to income taxation upon the grant of options under the Stock Option
Plan. Upon exercise of an NSO, the option holder will realize
ordinary income equal to the excess of the fair market value of the
Common Stock at that time over the exercise price. An option
holder does not realize income upon exercise of an ISO, but the
excess of the fair market value over the exercise price constitutes
an item of tax preference for computing the alternative minimum
tax. Upon a taxable disposition of shares acquired by exercise of
an ISO, the option holder will generally recognize taxable income.
In general, for tax purposes, the basis of shares acquired upon
option exercise is their fair market value on the date of exercise.
The Company will be entitled to a federal income tax deduction at
the time and in the same amount as the optionee realizes ordinary
income upon exercise.

The benefits under this plan to be provided in the future are
not determinable at this time. However, the following table
describes the options granted under the Stock Option Plan in 1995
and through February 29, 1996, to each of the Named Executive
Officers, the executive officers as a group, and the nonofficer
employees as a group. The figures reported for 1995 in this table
for the Named Executive Officers are also reported under the column
heading "Long-Term Compensation Awards - Securities Underlying
Options/SARs" in the Summary Compensation Table and in the
Option/SAR Grants in 1995 table.

<PAGE>
KEY EXECUTIVE STOCK OPTION PLAN BENEFITS

Dollar Value 1995 No. of Units 1996 No. of Units

Name
Peter G. Danis Jr.. . . . . $ N/A 134,800 87,000
Richard L. Black. . . . . . N/A 33,800 32,000
Christopher C. Milliken . . N/A 42,400 32,000
Carol B. Moerdyk. . . . . . N/A 42,400 32,000
Lawrence E. Beeson. . . . . N/A 42,400 13,200
Executive officers as
a group . . . . . . . . . N/A 371,800 242,600
Nonofficer employees as
a group . . . . . . . . . N/A 275,600 266,400

All of the options granted to date are NSOs and expire on the
first to occur of (a) ten years and one day from the date they were
granted; (b) three years after the optionee's retirement, death or
total and permanent disability; (c) three years following
termination of the option holder's employment with the Company
(provided that (i) the termination is the direct result of the sale
or permanent closure of any facility or operating unit of the
Company and (ii) the option holder has not, as of the date of the
exercise of the option, commenced employment with any competitor of
the Company); or (d) three months after termination of the option
holder's employment with the Company for any other reason, except
that the option expires immediately in the event of termination of
employment for disciplinary reasons. One-third of each option is
exercisable after one year from the grant date; two-thirds of each
option is exercisable after two years from the grant date; and the
entire option is exercisable three years from the grant date.

Summary Compensation Table

The following table sets forth the information regarding the
compensation paid to the Company's Chief Executive Officer and each
of the other four most highly compensated executive officers of the
Company (the "Named Executive Officers") during 1995. Because the
Company first became publicly held in April 1995, the compensation
figures also include amounts earned by the Named Executive Officers
during the period from January through March 1995, when the Company
was operating as a division of BCC.

<PAGE>

<TABLE>
SUMMARY COMPENSATION TABLE

<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
Other Securities
Annual Underlying All Other
Name and Principal Salary($) Bonus($) Compensation($) Options/SARs(#) Compensation ($)
Position (1) Year (2) (3) (4) (5) (6)
<S> <C> <C> <C> <C> <C> <C>

Peter G. Danis Jr. 1995 $385,800 $398,762 $839 134,800 $49,684
President and
Chief Executive Officer
Richard L. Black 1995 192,213 157,054 -- 33,800 6,608
President, Reliable
Corporation
Christopher C. Milliken 1995 182,505 158,094 -- 42,400 18,182
Senior Vice President,
Operations
Carol B. Moerdyk 1995 182,067 158,094 -- 42,400 21,417
Senior Vice President,
Chief Financial Officer
and Treasurer
Lawrence E. Beeson 1995 138,762 128,192 28,318 42,400 5,855
Vice President,
Marketing
_________________________
</TABLE>

(1) Mr. Danis is also executive vice president and general
manager, Office Products Distribution, BCC. Mr. Milliken is
also vice president, operations, Office Products Distribution,
BCC. Ms. Moerdyk is also vice president, finance, Office
Products Distribution, BCC.

(2) Includes amounts deferred under the SSRP and Key Executive
Deferred Compensation Plan. Mr. Beeson commenced his
employment with the Company on April 1, 1995. His annual
salary is approximately $185,000.

(3) Payments, if any under the Company's variable incentive
compensation program. See "Executive Compensation - Key
Executive Performance Plan."

(4) The amounts shown in this column reflect the amount of federal
income tax incurred by the Named Executive Officers and paid
by the Company relating to various executive officer benefits.
In 1995, Mr. Beeson received a moving expense reimbursement of
$28,318. The cost incurred by the Company during 1995 for all
the various perquisites provided to each of the other Named
Executive Officers is not included in this column, because the
amount did not exceed the lesser of $50,000 or 10% of the
executive's compensation during the year.

(5) Grants under the Company's Key Executive Stock Option Plan.

(6) Amounts disclosed in this column include the following:
<PAGE>
<TABLE>
<CAPTION>
Company Matching Accruals of
Contributions Above-Market Allocations Company-
to the Interest on to BCC Paid Portion
Key Executive Key Executive Employee of Executive
Deferred Deferred Stock Officer Life
Compensation Compensation Plan Ownership Insurance
Name Year or SSRP Plans($)(*) Balances($) Plans($) Programs($)
<S> <C> <C> <C> <C> <C>
Peter G. Danis Jr.. . . . . 1995 $21,166 $22,336 $2,000 $4,182
Richard L. Black. . . . . . 1995 6,189 419 - -
Christopher C. Milliken . . 1995 9,294 5,300 1,820 1,768
Carol B. Moerdyk. . . . . . 1995 9,735 2,309 1,450 7,923
Lawrence A. Beeson. . . . . 1995 5,180 87 70 518
_________________________

(*) The Company's Key Executive Deferred Compensation Plan is an
unfunded plan pursuant to which key executives of the Company,
including executive officers, may irrevocably elect to defer
receipt of a portion (6% to 20% for executive officers) of
their annual base salary until termination of employment or
beyond. Amounts so deferred generally are credited with
imputed interest at a rate equal to 130% of Moody's Composite
Average of Yields on Corporate Bonds. The SSRP is a profit-
sharing plan qualified under Section 401(a) of the Internal
Revenue Code which contains a cash or deferred arrangement
meeting the requirements of Section 401(k) of the Code.
</TABLE>

Stock Options

The following table provides detailed information regarding
option grants under the Stock Option Plan during 1995 to the Named
Executive Officers:

<TABLE>
OPTION/SAR GRANTS IN 1995

Individual Grants

Potential
Realizable Value
Number of Percent of at Assumed
Securities Total Annual
Underlying Options/ Rates of Stock
Options/ SARs Exercise Price Appreciation
SARs Granted to or Base for Option
Granted Employees in Price Expiration Term(2)
Name (#) Fiscal Year ($/Sh)(1) Date 5%($) 10%($)

<S> <C> <C> <C> <C> <C> <C>
Peter G. Danis Jr.. . . . 134,800 20.6% $12.50 2/21/05 $1,059,688 $2,685,455
Richard L. Black. . . . . 33,800 5.2 12.50 2/21/05 265,708 673,356
Christopher C. Milliken . 42,400 6.5 12.50 2/21/05 333,314 844,683
Carol B. Moerdyk. . . . . 42,400 6.5 12.50 2/21/05 333,314 844,683
Lawrence E. Beeson. . . . 42,400 6.5 12.50 2/21/05 333,314 844,683
</TABLE>

_________________________

(1) Under the Stock Option Plan, the exercise price must be the
fair market value at the date of grant. Options granted under
this plan during 1995 were fully vested when granted.
However, except for specific situations, the options are
exercisable only as follows: one-third of each option is
exercisable after one year from the grant date, two-thirds of
each option is exercisable after two years from the grant
date, and the entire option is exercisable after three years
from the grant date. Under the plan, no options may be
granted after February 20, 2005.

(2) The dollar amounts in these columns are based on price
appreciation calculations required by the SEC and are not
intended to forecast possible future appreciation of the
Company's Common Stock price. Based on these price
appreciation calculations and an assumed beginning stock value
of $12.50, at the date of expiration the Company's outstanding
Common Stock would be trading at $20.36 and $32.42 per share,
respectively, which represents in aggregate a potential
realizable increase in stock value for Common Stock
shareholders of $489.7 million and $1.241 billion,
respectively. In addition, the dollar amount shown for each
of the Named Executive Officers is not discounted to present
value and is prior to payment of federal and state taxes.

Option Exercises and Value at Fiscal Year-End

The following table sets forth information concerning the
exercise of stock options during 1995 and the year-end value of all
unexercised stock options granted under the Stock Option Plan to
the Named Executive Officers.

<PAGE>
AGGREGATE OPTIONS/SAR EXERCISES FOR 1995 AND 1995 OPTION/SAR VALUES

<TABLE>
<CAPTION>
Number of Value of
Securities Unexercised
Underlying In-the-Money
Unexercised Options/
Shares Options/SARs SARs at
Acquired at 12/31/95(#) 12/31/95($)
Upon Value Exercisable Exercisable
Name Exercise(#) Realized Unexercisable Unexercisable

<S> <C> <C> <C> <C>
Peter G. Danis Jr.. . . . . None N/A 0/134,800 $ 0/1,196,350
Richard L. Black. . . . . . None N/A 0/33,800 0/ 299,975
Christopher C. Milliken . . None N/A 0/42,400 0/ 376,300
Carol B. Moerdyk. . . . . . None N/A 0/42,400 0/ 376,300
Lawrence E. Beeson. . . . . None N/A 0/42,400 0/ 376,300

_________________________

* This column indicates the aggregate amount, if any, by which the
market price of the Common Stock subject to such options on
December 29, 1995, $21.375 per share, exceeded the options'
total exercise price.
</TABLE>

Other Benefit Plans

Pension Plan

The Company is a participating employer in the Boise Cascade
Corporation Pension Plan for Salaried Employees (the "Pension
Plan"). The estimated annual benefits payable upon retirement at
age 65 under the Pension Plan for specified levels of average
remuneration and years-of-service are described in the following
table:
<PAGE>
<TABLE>
PENSION PLAN TABLE

<CAPTION>
Years of Service
Remuneration 15 20 25 30 35 40
<C> <C> <C> <C> <C> <C> <C>
$150,000 $ 28,125 $ 37,500 $ 46,875 $ 56,250 $ 65,625 $ 75,000
175,000 32,812 43,750 54,687 65,625 76,562 87,500
200,000 37,500 50,000 62,500 75,000 87,500 100,000
250,000 46,875 62,500 78,125 93,750 109,375 125,000
300,000 56,250 75,000 93,750 112,500 131,250 150,000
400,000 75,000 100,000 125,000 150,000 175,000 200,000
500,000 93,750 125,000 156,250 187,500 218,750 250,000
600,000 112,500 150,000 187,500 225,000 262,500 300,000
700,000 131,250 175,000 218,750 262,500 306,250 350,000
800,000 150,000 200,000 250,000 300,000 350,000 400,000
</TABLE>

The Pension Plan entitles each vested employee, including
executive officers, to an annual pension benefit at normal
retirement equal to 1 1/4% of the highest average of any five
consecutive years of salary and other compensation (as defined in
the plan) out of the last ten years of employment, multiplied by
the employee's years of service. The years of service determined
under the provisions of the plan as of December 31, 1995, for each
of the Named Executive Officers were as follows: Mr. Danis, 28; Mr.
Black, 2; Mr. Milliken, 18; Ms. Moerdyk, 15; and Mr. Beeson, 1.

For purposes of determining the benefit amount under the Pension
Plan, a participant's base salary is used, plus amounts earned
under the Company's variable incentive compensation program (only
"Salary" and "Bonus" from the Summary Compensation Table). The
Company-provided pension would, as of December 31, 1995, be based
on the following compensation amounts for each of the Named
Executive Officers, which represent the highest average of each
executive's annual compensation during any five consecutive years
for 1986 through 1995: Mr. Danis, $435,768; Mr. Black, 224,307; Mr.
Milliken, $161,135; Ms. Moerdyk, $185,803; and Mr. Beeson,
$167,898.

Benefits are computed (as in the foregoing table) on a
straight-life annuity basis and are not subject to offset by social
security or other retirement-type benefits. A participant is 100%
vested in his or her pension benefit after five years of service,
except for certain breaks in service. If a participant is entitled
to a pension benefit under the Company's Pension Plan in excess of
the limitations imposed by the Internal Revenue Code on
tax-qualified plans, the Company has an unfunded Supplemental
Pension Plan, under which the excess benefits will be paid from the
Company's general assets. The benefit earned under the qualified
pension plan is reduced by deferred compensation under any
nonqualified deferred compensation plan of the Company. The
Company's Supplemental Pension Plan will also provide payments to
the extent that participation in these deferred compensation plans
has the effect of reducing an individual's pension benefit under
the qualified plan.

The Pension Plan provides that in the event of a change in
control (as defined in the plan) of BCC, the ability of the plan
sponsor or its successor to recoup surplus plan assets, if any,
will be restricted. In general, after a change in control, if (a)
the plan is terminated, (b) the plan is merged or consolidated with
another plan, (c) the assets of the plan are transferred to another
plan, then the surplus assets of the plan, if any, will be
allocated among the plan's participants and beneficiaries on a pro
rata basis. This restriction may not be amended after a change in
control without the consent of a majority (in number and interest)
of plan participants and beneficiaries.

Early Retirement Plan

The Company also has an Early Retirement Plan for certain
executive officers 55 years of age or older who have ten or more
years of service with the Company and who retire or are requested
to retire at the Company's convenience prior to the normal
retirement age of 65. The plan will pay an eligible executive
officer an early retirement benefit prior to age 65 equal to the
amount of the officer's benefit calculated under the Pension Plan
for Salaried Employees without reduction due to early retirement.
Messrs. Danis and Milliken and Ms. Moerdyk are currently eligible
to participate in this plan.

Executive Officer Agreements

The Company has entered into agreements with Messrs. Danis and
Milliken and Ms. Moerdyk who are also executive officers (but not
employees) of BCC. These agreements formalize the Company's
intention to pay severance benefits in the event that any of those
persons' employment with the Company is terminated subsequent to a
change in control (as defined in the agreements) of BCC. BCC has
entered into similar agreements with all of its executive officers.
The Board of Directors believes that these executive officers have
made and will continue to make substantial contributions to the
Company and its future business prospects. The agreements are
intended to induce these executive officers to remain in the employ
of the Company and to help ensure that the Company and the Board of
Directors will have the benefit of these executive officers'
services without distraction in the face of a change in control of
the Company's majority shareholder. The agreements provide
severance benefits and generally protect benefits the executive
officers have already earned or have a reasonable right to expect,
based on existing Company benefit plans, in the event their
employment is terminated as a consequence of a change in control.

Under the agreements, benefits are paid if, after a change in
control, the Company terminates the executive other than for cause
or disability (as defined in the agreements) or if the executive
terminates his or her employment following certain actions (as
specified in the agreements) by the Company which would adversely
affect the executive. These severance benefits include: (a) the
executive's salary through the termination date; (b) severance pay
equal to three times the executive's annual base salary and target
incentive pay, reduced by any severance pay which the executive
receives in accordance with the Company's Severance Pay Policy for
Executive Officers, which is currently an amount equal to the
executive's annual base salary; (c) vacation pay in accordance with
the Company's Vacation Policy; (d) an amount equal to any earned
but unpaid bonus under the Key Executive Performance Plan (or
substitute plan) for the year preceding termination and an award
under the Key Executive Performance Plan (or substitute plan) equal
to the greater of the executive's target award prorated through the
month in which termination occurs or the actual award through the
end of the month prior to termination based upon the award criteria
for the plan in which the executive is participating prorated
through the month in which termination occurs; (e) acceleration of
the exerciseability of stock options held by the executive; (f)
benefits under the Company's Supplemental Early Retirement Plan;
and (g) certain additional retirement and other employee benefits.
The agreements also provide that following such termination of
employment, the Company will maintain, at the Company's expense, in
full force and effect for up to one year, all employee benefit
plans and programs in which the executive was entitled to
participate immediately prior to the date of termination, or will
substitute arrangements providing substantially similar benefits,
and will also continue its participation in the Executive Officer
Life Insurance Program until the insurance policy is fully paid.
The agreements also provide that the Company will pay legal fees
and expenses incurred by the executive to enforce his or her rights
or benefits under the agreements.

Under the agreements, the executive officer is obligated to
remain in the employ of the Company for a period of six months
following the first potential change in control (as defined in the
agreements) of BCC. The aggregate amount of payments and other
benefits (not including legal fees, if any) which would be paid
pursuant to the executive officer agreements in excess of the plan
benefits to which the executive would be entitled absent the
agreements, if determined as of December 31, 1995, would be
approximately as follows: Messrs. Danis, $2,900,429, and Mr.
Milliken, $1,337,476, and Ms. Moerdyk, $1,287,078 (payments which
would be made subsequent to the termination date have been
discounted as of December 31, 1995, in accordance with the
requirements of Section 280G of the Internal Revenue Code, at a
rate of 7%). Actual payments at any future date, if made, may
vary, depending in part upon the accruals under the variable
compensation plans and benefit plans.

Each agreement continues in effect until December 31, 1998, and
is automatically extended on each subsequent January 1 for a new
three-year period, unless by September 30 of the preceding year,
the Company gives notice that it does not wish to extend the
agreement. The agreements concisely summarize the Company's
compensation plans, practices and intent in the event of
termination of the executives subsequent to a change in control of
the Company's majority shareholder. The Board of Directors
believes the agreements are in the best interests of the Company
and the shareholders.

Deferred Compensation and Benefits Trust

The Company will establish a deferred compensation and benefits
trust to ensure that participants and their beneficiaries under
several of the Company's nonqualified and unfunded deferred
compensation plans and the executive officer agreements will
receive the benefits they have earned and to which they are
entitled in the event of a change in control of the Company's
majority shareholder (as defined in the plans and the agreements).
Under the terms of the plans and agreements, the trust will be
revocably funded in the event of a potential change in control.
Upon any actual change in control, the funding will be irrevocable,
and the trust will make payment to participants under the plans and
agreements on behalf of the Company. The trustee's fees and
expenses will be paid by the Company or out of the trust assets.
The trust assets will be accessible to the claims of creditors of
the Company in the event of bankruptcy or insolvency. The
existence and any subsequent funding of the trust will not increase
the benefits to which any individual participants are entitled
under any of the covered plans and agreements.

Indemnification

The Company will indemnify, to the extent permitted by Delaware
law, its directors and officers against liabilities (including
expenses, judgments and settlements) incurred by them in connection
with any actual or threatened action, suit or proceeding to which
they are or may become parties and which arises out of their status
as directors and officers. The Company has obtained insurance
which insures, within stated limits, the directors and officers
against these liabilities. The aggregate amount of the premium on
the policies for 1995 was $75,000.

Each of the Company's executive officers is required to enter
into a confidential information and noncompetition agreement with
the Company (a "Noncompetition Agreement"). Each Noncompetition
Agreement prohibits the unauthorized disclosure of confidential
information concerning the Company's business and, for a period of
one year following termination of employment with the Company,
prohibits that officer from accepting employment with any
competitor of the Company.

The Board of Directors has established a policy requiring every
officer of the Company to retire no later than December 31 of the
year in which he or she reaches age 65. The policy is subject to
certain exceptions and may be waived by the Board in any individual
case.

RELATIONSHIP WITH BOISE CASCADE CORPORATION

Boise Cascade Corporation currently owns approximately 81.5% of
the outstanding shares of Common Stock of the Company and is able
to control the election of directors and the vote on other matters
submitted to stockholders, including the approval of extraordinary
corporate transactions. In addition, the three most senior
officers of the Company are also executive officers of BCC.

The Company supplies office products to BCC and purchases
certain paper and paper products from BCC. During the year ended
December 31, 1995, the Company's sales to BCC were $2,046,000, and
its purchases from BCC were $164,417,000. The Company anticipates
that its sales and purchases with BCC during 1996 will exceed those
in 1995.

The following discussion of the terms and provisions of the
agreements described below (except with respect to those agreements
referred to under "-- Certain Property Arrangements") is qualified
in its entirety by reference to such agreements, a copy of each of
which has been incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus forms a part.

Organization

The Company was incorporated in Delaware on January 3, 1995.
Prior to April 1, 1995, the Company's business was operated as the
Boise Cascade Office Products Distribution Division of BCC.
Effective April 1, 1995, pursuant to the Subscription Agreement,
the following occurred: (i) BCC contributed to the Company
substantially all of the operating assets of the Division,
including all owned and leased real property, inventory, equipment,
fixtures, vehicles, intellectual property, contract rights, and the
capital stock of the Company's subsidiaries but excluding $100
million of accounts receivable and certain tradenames and
trademarks (which are licensed to the Company, as discussed below
under "-- License Agreement"); (ii) the Company assumed
substantially all of the liabilities relating to the Division,
other than liabilities relating to the sale of the Division's
former wholesale office products distribution business and
liabilities under BCC's qualified and non-qualified retirement
plans and retiree medical benefit plans (subject, in the case of
retiree medical benefits, to reimbursement of certain costs in
respect of, and periodic additional accruals required under, the
plans after the Organization) arising out of service to the
Division prior to April 1, 1995 by past and present employees of
the Division on that date; and (iii) the Company issued 50,750,000
shares of Common Stock to BCC. As of April 1, 1995, BCC and the
Company also entered into the Intercompany Agreements, which are
described below.

Prior to their execution by the Company, the Subscription
Agreement and each of the Intercompany Agreements were approved by
the Committee of Independent Directors of the Board of Directors of
the Company. However, because of the complexity of the various
relationships between the Company and BCC, there can be no
assurance that each of the Intercompany Agreements, or the
transactions provided for therein, considered separately, has been
or will be effected on terms no less favorable to the Company than
could have been obtained from unaffiliated third parties. It has
been the intention of the Company and BCC, however, that these
agreements and transactions, taken as a whole, should accommodate
their respective interests in a manner that is fair to all parties,
while continuing certain mutually beneficial joint arrangements.
Additional or modified arrangements and transactions may be entered
into by the Company and BCC. While any such future arrangements
and transactions are expected to be determined through negotiations
between them, there can be no assurance that conflicts of interest
will not occur. Although the Company has not adopted any formal
procedures designed to assure that conflicts or interest will not
occur, the Company intends to seek the approval of the Committee of
Independent Directors for any agreement which its management or any
independent director of the Company believes to be of material
importance to the Company and to involve a significant conflict of
interest with BCC.

Paper Sales Agreement

The Company and BCC have entered into an agreement (the "Paper
Sales Agreement") pursuant to which BCC sells to the Company
cutsize paper, including copier and fax paper ("Cutsize Paper").

Under the Paper Sales Agreement, the Company agrees to purchase,
and BCC agrees to sell, all of the Company's Cutsize Paper
requirements. However, upon 12 months' prior notice of its
inability or unwillingness to supply all such requirements, BCC may
reduce its annual supply obligation to an amount not less than the
Company's Base Requirements (as defined) for Cutsize Paper. "Base
Requirements" for this purpose means the sum of the annualized
volume of the Company's purchases of Cutsize Paper in the month
immediately preceding such notice plus additional volume sufficient
to accommodate 12 months' sales growth at a rate equal to the
aggregate percentage increase in the Company's sales of Cutsize
Paper during the 12 months immediately preceding such notice over
the prior 12-month period. In that event, BCC may elect either to
purchase the Company's requirements for Cutsize Paper in excess of
the Base Requirements (the "Additional Requirements") from other
sources and resell them to the Company at a mutually agreed price
or allow the Company to purchase such Additional Requirements from
other sources. In the event the Company effects such purchases of
its Additional Requirements from other sources, BCC will have the
option, exercisable upon at least 13 months' prior written notice,
to supply to the Company some or all of such Additional
Requirements pursuant to the terms of the Paper Sales Agreement.

The prices paid for Cutsize Paper by the Company pursuant to the
Paper Sales Agreement are based upon a formula meant to approximate
prevailing market prices for Cutsize Paper. The agreement has an
initial term of twenty years, and will be automatically renewed for
five-year periods thereafter, subject to either party's option to
terminate the agreement at the end of the initial or any renewal
term or at any time during the initial or any renewal term after
BCC's ownership of the then issued and outstanding voting stock of
the Company falls below 50%. The agreement provides that any such
termination will be implemented over a five-year period with annual
ratable reductions in the amount of Cutsize Paper supplied by BCC
to the Company.

Shareholder Agreement

The Company and BCC have entered into an agreement (the
"Shareholder Agreement") pursuant to which the Company has granted
to BCC a continuing option (the "Option") to purchase from the
Company any or all (i) shares of voting stock, or securities
convertible into or exchangeable for voting stock ("Other Voting
Securities"), of the Company or (ii) for so long as BCC is entitled
to include the Company in BCC's consolidated federal income tax
return, any other securities of the Company that may reasonably be
considered stock for purposes of determining whether the Company is
properly included in BCC's consolidated federal income tax return
(together, the "Offered Securities"), that the Company may propose
to issue. The Option is exercisable by BCC, in whole or in part
and subject to certain limitations, with respect to issuances of
Offered Securities other than issuances (i) pursuant to the
Company's director or employee benefit plans, (ii) to the sellers
of businesses acquired by the Company, (iii) pursuant to an
exchange offer for outstanding securities of the Company that does
not have the effect of decreasing BCC's percentage ownership of the
voting stock of the Company (on a fully diluted basis), or
(iv) pursuant to the exercise or conversion of outstanding Other
Voting Securities. Upon receipt of notice of a proposed issuance
(the "Notice"), BCC shall have 15 days within which to exercise its
Option to purchase some or all of the Offered Securities to be
issued in accordance with the terms set forth in the Notice, which
terms shall have been approved by the independent directors of the
Company.

In the event BCC exercises its Option for all of the Offered
Securities so offered, the exercise price per Offered Security
payable by BCC in cash shall be (i) in the case of a security for
which a public market exists, the average of the closing prices of
such security for the five trading days preceding the date of the
Notice, and (ii) in the case of a security for which no public
market exists, the price which could reasonably be obtained in the
market for such securities at the time of the Notice as determined
by the independent directors of the Company or, at BCC's option, by
a nationally recognized investment banking firm acceptable to both
the Company and BCC. If the price is determined by such investment
banking firm, the Company may elect not to complete such issuance
of Offered Securities. To the extent BCC does not exercise its
Option to purchase any of the Offered Securities, or exercises the
Option in part, the Company may issue and sell such Offered
Securities within the following 120 days at such price as it shall
determine and on terms not otherwise substantially more favorable
to the purchasers than those offered to BCC. In the event BCC
exercises its Option for only a portion of the Offered Securities,
the exercise price per Offered Security payable by BCC shall be
equal to the price paid by other purchasers of such Offered
Securities. BCC will continue to have an Option to purchase any
and all Offered Securities issued by the Company for so long as BCC
owns at least 33 1/3% of the voting power of the Company's
outstanding capital stock. BCC may only transfer its Option rights
to its affiliates or pursuant to a merger, consolidation, or
transfer of substantially all of its assets.

The Shareholder Agreement also includes provisions pursuant to
which the Company has granted certain rights (the "Registration
Rights") to BCC with respect to the registration under the
Securities Act of (i) the shares of Common Stock owned by BCC at
the closing of the Offerings and (ii) any Offered Securities that
are purchased by BCC pursuant to its Option (together, the
"Registrable Securities"). Pursuant to the Shareholder Agreement,
BCC will be able to require the Company, not more than once in any
365-day period commencing on the first anniversary of the closing
of the Offerings and on not more than three occasions after BCC no
longer owns a majority of the voting power of the outstanding
capital stock of the Company, to file a registration statement
under the Securities Act covering the registration of the
Registrable Securities, including in connection with an offering by
BCC of its securities that are exchangeable for the Registrable
Securities (the "Demand Registration Rights"). BCC's Demand
Registration Rights are subject to certain limitations, including
that any such registration cover a number of Registrable Securities
having a fair market value of at least $50 million at the time of
the request for registration and that the Company may be able to
temporarily defer a Demand Registration to the extent it conflicts
with another public offering of securities by the Company or would
require the Company to disclose certain material non-public
information. BCC will also be able to require the Company to
include Registrable Securities owned by BCC in a registration by
the Company of its securities (the "Piggyback Registration
Rights"), subject to certain conditions, including the ability of
the underwriters to limit or exclude Registrable Securities from
such an offering. BCC has waived its Piggyback Registration Rights
with respect to the registration of the Common Stock covered by
this Prospectus.

The Company and BCC will share equally the out-of-pocket fees
and expenses of the Company associated with a demand registration
and BCC will pay its pro rata share of underwriting discounts,
commissions, and related expenses (the "Selling Expenses"). The
Company will pay all expenses associated with a piggyback
registration except that BCC will pay its pro rata share of the
Selling Expenses. The Shareholder Agreement contains certain
indemnification and contribution provisions (i) by BCC for the
benefit of the Company and related persons, as well as any
potential underwriter, and (ii) by the Company for the benefit of
BCC and related persons, as well as any potential underwriter.
BCC's Demand Registration Rights will terminate on the date that
BCC owns, on a fully converted or exercised basis with respect to
such securities held by BCC, Registrable Securities representing
less than 10% of the then issued and outstanding voting stock of
the Company. BCC's Piggyback Registration Rights will terminate at
such time as it is able to sell all of its Registrable Securities
pursuant to Rule 144 under the Securities Act within a three-month
period. BCC also may transfer its Registration Rights to any
transferee from it of Registrable Securities that represent, on a
fully converted or exercised basis with respect to the Registrable
Securities transferred, at least 20% of the then issued and
outstanding voting stock of the Company at the time of transfer;
provided, however, that any such transferee will be limited to
(i) two demand registrations if the transfer conveys less than a
majority but more than 30% and (ii) one demand registration if the
transfer conveys 30% or less of the then issued and outstanding
voting stock of the Company.

Administrative Services Agreement

As part of the Organization, the Company and BCC have entered
into an agreement (the "Administrative Services Agreement")
pursuant to which BCC provides various services to the Company that
were previously carried out by BCC for the Division. These
services include financial reporting, cash management, human
resources services, legal and corporate secretarial functions,
internal audit, benefits administration, and insurance. The
services are being provided for varying periods, from one to five
years from the date of the Organization, identified in the
Administrative Services Agreement and are subject to renewal or
termination in accordance with the terms of such agreement.

The Company pays for each of these services at rates set forth
in the agreement. Generally these rates are consistent with
amounts that have been charged by BCC in the past and reflect a
reasonable approximation of the cost to BCC of providing such
services to the Company. During 1995, the fees paid to BCC under
this Agreement were $2,382,000.

License Agreement

As part of the Organization, the Company and BCC have entered
into an agreement (the "License Agreement") pursuant to which BCC
has granted to the Company a royalty-free, non-exclusive license to
use the tradenames Boise Cascade(R) and Cascade(R) and BCC's
tree-in-a-circle trademark. Such license has an initial term of
five years and will be automatically renewed for one-year periods
thereafter unless notice of termination is given by BCC. Upon
termination of the license, the Company will have 24 months
following the termination date to cease all use of the tradenames
and trademark.

Tax Matters Agreement

As part of the Organization, the Company and BCC have entered
into an agreement (the "Tax Matters Agreement") which governs the
allocation between the parties of state and federal tax liabilities
and obligations. Pursuant to the Tax Matters Agreement, all tax
obligations arising from the operations of the Division prior to
the Organization are the responsibility and liability of BCC. From
and after the completion of the Organization on April 1, 1995, the
Company is responsible for all tax liabilities incurred by it but
BCC will have the right and obligation, subject to certain
constraints, to (i) determine whether to include the Company in
BCC's consolidated group tax returns, (ii) prepare and file the
Company's tax returns, (iii) conduct all audits of and litigation
regarding the Company's tax returns, (iv) allocate any net
operating loss or other tax credits between the Company and BCC,
and (v) determine the final disposition of all tax matters. The
Company will reimburse BCC for all outside tax administration costs
relating to the Company incurred by BCC in connection with the Tax
Matters Agreement. The Company will reimburse BCC through the
Administrative Services Agreement for all such internal tax
administration costs relating to the Company incurred by BCC. The
Tax Matters Agreement will remain in force until BCC no longer owns
at least 50% of the voting stock of the Company.

<PAGE>
OWNERSHIP OF STOCK OF THE COMPANY AND BOISE CASCADE CORPORATION

The table below sets forth certain information with respect to
the beneficial ownership of the Common Stock of the Company as of
December 31, 1995 by (i) each beneficial owner of more than 5% of
the outstanding shares of Common Stock, (ii) each Named Executive
Officer, (iii) each director of the Company, and (iv) the Company's
directors and executive officers as a group.

Number of Shares
of Common Stock
Beneficially
Name and Address of Beneficial Owner Owned(1) Percent of Class

5% Beneficial Owners
Boise Cascade Corporation . . . . . . . . 50,750,000(2) 81.5%
1111 West Jefferson Street
Boise, ID 83702

Putnam Investments, Inc.. . . . . . . . . 3,560,890(3) 5.7%
One Post Office Square
Boston, MA 02109

Named Executive Officers(4)
Peter G. Danis Jr.. . . . . . . . . . . . 154,800(4) *
Richard L. Black. . . . . . . . . . . . . 35,294(4) *
Christopher C. Milliken . . . . . . . . . 50,800(4) *
Carol B. Moerdyk. . . . . . . . . . . . . 44,400(4) *
Lawrence E. Beeson. . . . . . . . . . . . 43,400(4) *

Directors(5)
George J. Harad . . . . . . . . . . . . . 2,000 *
John B. Carley. . . . . . . . . . . . . . 8,000 *
James G. Connelly III . . . . . . . . . . 5,000 *
Theodore Crumley. . . . . . . . . . . . . 1,000 *
A. William Reynolds . . . . . . . . . . . 24,000 *

All directors and executive officers
as a group(1)(2)(3) . . . . . . . . . . 449,864 *

* Less than 1% of class
___________________________

(1) Amounts shown in this table do not include options granted on
January 30, 1996, which are disclosed in the "Key Executive
Stock Option Plan Benefits" table on page 34.

(2) BCC reported on a Schedule 13G that it was the beneficial
owner of 50,750,000 shares of the Company's Common Stock.
This report indicates that BCC has sole voting and investment
power for 50,750,000 shares.

(3) Putnam Investments, Inc., and related entities, reported on a
Schedule 13G that they were the beneficial owner of 3,560,890
shares of the Company's Common Stock. This report indicates
that Putnam Investments, Inc., and related entities, have
shared voting power for 230,400 shares and shared investment
power for all 3,560,890 shares.

(4) The beneficial ownership for the Named Executive Officers
includes all shares held of record or in street name, plus
options granted but unexercised under the Key Executive Stock
Option Plan ("Stock Option Plan") described commencing on page
33, and interests in shares of Common Stock held by the
trustee of the Savings and Supplemental Retirement Plan
("SSRP"), a defined contribution plan qualified under Section
401(a) of the Internal Revenue Code. The following table
indicates the nature of each executive's stock ownership:

<PAGE>
Common Unexercised
Shares Option
Owned Shares
Peter G. Danis Jr. . . . . . 20,000 134,800
Richard L. Black . . . . . . 1,494 33,800
Christopher C. Milliken. . . 8,400 42,400
Carol B. Moerdyk . . . . . . 2,000 42,400
Lawrence E. Beeson . . . . . 1,000 42,400
All executive officers as
a group. . . . . . . . . . 38,064 371,800

(5) Beneficial ownership for the directors includes all shares
held of record or in street name, plus options granted but
unexercised under the Director Stock Option Plan ("DSOP"),
described on page 31. The number of shares subject to options
under the DSOP included in the beneficial ownership table is
as follows: Messrs. Carley, 4,000 shares; Connelly, 4,000
shares; Reynolds, 4,000 shares, and directors as a group,
12,000 shares.

<PAGE>
The following table sets forth certain information, as of
December 31, 1995, with respect to the beneficial ownership of
BCC's common and preferred stock by each of the Company's Named
Executive Officers and directors and by all of the Company's
directors and executive officers as a group.

<TABLE>
<CAPTION>
Total
Common Unexercised SSRP Shares ESOP
Shares Option (Common Common (Preferred
Owned Shares Stock) Stock Stock)(2)
Name of Beneficial Owner

<S> <C> <C> <C> <C> <C>
Named Executive Officers
Peter G. Danis Jr.. . . . . . 1,740 146,417 3,791 151,948 372
Richard L. Black. . . . . . . -- 13,200 -- 13,200 --
Christopher C. Milliken . . . -- 13,925 -- 13,925 726
Carol B. Moerdyk. . . . . . . -- 55,233 40 55,273 213
Lawrence A. Beeson. . . . . . -- -- -- -- --

Directors
George J. Harad . . . . . . . 3,050 491,650 7,471 502,171(1) 552
John B. Carley. . . . . . . . -- -- -- -- --
James G. Connelly III . . . . -- -- -- -- --
Theodore Crumley. . . . . . . 1,180 65,383 7,478 74,041 368
A. William Reynolds . . . . . 10,000 7,380 -- 17,380 --

All directors and executive
officers as a group . . . . 17,903 941,154 25,954 985,011(1) 5,692
</TABLE>

(1) Mr. Harad beneficially owns approximately 1% of BCC's common
stock. All of the Company's executive officers and directors
(as a group) beneficially own 1.9% of BCC's common stock.

(2) The Company's executive officers and directors (individually
or as a group) do not own more than 1% of any series of BCC's
preferred stock.

DESCRIPTION OF CAPITAL STOCK

The authorized capital stock of the Company consists of 200
million shares of Common Stock, $.01 par value per share, and
20 million shares of preferred stock, $.01 par value per share (the
"Preferred Stock"). As of February 29, 1995, 62,315,526 shares of
Common Stock were issued and outstanding and no shares of Preferred
Stock were issued and outstanding. The following description is a
summary and is qualified in its entirety by reference to the
provisions of the Company's Restated Certificate of Incorporation
(the "Certificate") and its Amended and Restated Bylaws (the
"Bylaws"), copies of which have been incorporated by reference as
exhibits to the Registration Statement of which this Prospectus
forms a part.

Common Stock

Except as required by law or by the Certificate, and subject to
the voting rights of holders of any then outstanding Preferred
Stock, holders of Common Stock are entitled to one vote for each
share held of record on all matters submitted to a vote of the
stockholders. Holders of a majority of the shares of Common Stock
represented at a meeting can elect all of the directors.
Accordingly, BCC is able to control the election of directors and
the vote on other matters submitted to stockholders, including the
approval of extraordinary corporate transactions. See "Risk
Factors" and "Relationship with Boise Cascade Corporation".
Subject to preferences that may be applicable to any then
outstanding Preferred Stock, holders of Common Stock are entitled
to receive ratably such dividends as may be declared by the Board
of Directors out of funds legally available therefor. See "Price
Range of Common Stock and Dividend Policy". In the event of a
liquidation, dissolution, or winding up of the Company, holders of
the Common Stock are entitled to share ratably in all assets
remaining after payment of liabilities and the liquidation
preference of any then outstanding Preferred Stock. Holders of
Common Stock have no preemptive rights and have no right to convert
their Common Stock into any other securities. There are no
redemption or sinking fund provisions applicable to the Common
Stock. All outstanding shares of Common Stock are fully paid and
nonassessable.

Preferred Stock

The Board of Directors has the authority, without further action
by the stockholders, to issue up to 20 million shares of Preferred
Stock in one or more series and to fix the voting powers,
designations, preferences, and relative, participating, optional,
or other special rights, and qualifications, limitations, and
restrictions thereof, including dividend rights, conversion rights,
voting rights, terms of redemption, liquidation preferences, and
the number of shares constituting any series. Because the Board of
Directors has the power to establish the preferences and rights of
the shares of any such series of Preferred Stock, it may afford
holders of any Preferred Stock preferences, powers, and rights
(including voting rights), senior to the rights of holders of
Common Stock, which could adversely affect the rights of holders of
Common Stock. The Company has no present plan to issue any shares
of Preferred Stock.

Certain Certificate and Bylaw Provisions

Certain provisions of the Certificate and Bylaws could be deemed
to have an anti-takeover effect. These provisions may have the
effect of discouraging an unsolicited takeover of the Company if
the Board of Directors determines that such a takeover is not in
the best interests of the Company and its stockholders, even if a
majority of stockholders deemed such an attempt to be in their best
interests. Because BCC presently owns approximately 81.5% of the
outstanding voting stock of the Company, the Company is not
currently subject to a change of control without the approval of
BCC, and would not in the future be so subject unless and until
BCC's percentage ownership were substantially reduced.

The Certificate provides for a classified Board consisting of
three classes of directors as nearly equal in size as the then
authorized number of directors constituting the Board permits. At
each annual meeting of stockholders, the class of directors to be
elected at such meeting will be elected for a three-year term and
the directors in the other two classes will continue in office.
Each class shall hold office until the date of the third annual
meeting for the election of directors following the annual meeting
at which such director was elected, except that the initial terms
of Class I, Class II, and Class III expire on the date of the
annual meeting in 1996, 1997, 1998, respectively. As a result,
approximately one-third of the Board will be elected each year.
The Certificate also provides that directors may be removed, with
or without cause, only with the approval of at least 66 2/3% of the
voting power of the Company's capital stock. If BCC's ownership
were reduced below 50%, this provision, when coupled with
provisions of the Certificate and Bylaws providing that newly
created and vacant directorships may be filled only by the majority
vote of the remaining directors then in office, could preclude
other stockholders from increasing the size of the Board and/or
removing incumbent directors and simultaneously gaining control of
the Board of Directors by filling the newly created directorships
and/or vacancies created by such removal with their own nominees.

The Certificate establishes an advance notice procedure for the
nomination, other than by or at the direction of the Board, of
candidates for election as directors as well as for other
stockholder proposals to be considered at annual meetings of
stockholders. In general, notice must be received by the Company
not less than 60 days nor more than 120 days prior to the meeting
and must contain certain specified information concerning the
persons to be nominated or the matters to be brought before the
meeting and concerning the stockholder submitting the nomination or
proposal.

The Certificate and the Bylaws provide that special meetings of
stockholders of the Company may be called only by the Chairman of
the Board or by a majority of the members of the Board. If BCC's
ownership were reduced below 50%, this provision could make it more
difficult for stockholders to take action opposed by the Board.

Delaware General Corporation Law

The Company is a Delaware corporation and is subject to
Section 203 of the Delaware General Corporation Law
("Section 203"). Pursuant to Section 203, with certain exceptions,
a Delaware corporation may not engage in any of a broad range of
business combinations, such as mergers, consolidations, and sales
of assets, with an "interested stockholder" for a period of three
years from the date that such person became an interested
stockholder unless (i) the transaction that results in the person's
becoming an interested stockholder, or the business combination, is
approved by the board of directors of the corporation before the
person becomes an interested stockholder, (ii) upon consummation of
the transaction which results in the stockholder becoming an
interested stockholder, the interested stockholder owns 85% or more
of the voting stock of the corporation outstanding at the time the
transaction commenced (other than certain excluded shares), or
(iii) on or after the date the person becomes an interested
stockholder, the business combination is approved by the
corporation's board of directors and by holders of at least
two-thirds of the corporation's outstanding voting stock, excluding
shares owned by the interested stockholder, at a meeting of
stockholders. Under Section 203, an "interested stockholder" is
defined as any person, other than the corporation and any direct or
indirect majority-owned subsidiaries of the corporation, that is
(i) the owner of 15% or more of the outstanding voting stock of the
corporation or (ii) an affiliate or associate of the corporation
and the owner of 15% or more of the outstanding voting stock of the
corporation at any time within the three-year period immediately
prior to the date on which it is sought to be determined whether
such person is an interested stockholder. The Company believes
that BCC is not subject to the restrictions of Section 203.

Under certain circumstances, Section 203 makes it more difficult
for a person who would be an "interested stockholder" to effect
various business combinations with a corporation for a three-year
period. The provisions of Section 203 may encourage persons
interested in acquiring the Company to negotiate in advance with
the Company's Board of Directors because the stockholder approval
requirement would be avoided if a majority of the Company's
directors then in office approve either the business combination or
the transaction which results in the person becoming an interested
stockholder. Such provisions also may have the effect of
preventing changes in management of the Company. It is possible
that such provisions could make it more difficult to accomplish
transactions that stockholders may otherwise deem to be in their
best interests.

Transfer Agent and Registrar

Mellon Securities Trust Company acts as co-transfer agent and
co-registrar for the Common Stock in New York, New York and Boise
Cascade Shareholder Services acts as co-transfer agent, and West
One Bank, Idaho acts as co-registrar, for the Common Stock in
Boise, Idaho.

SHARES ELIGIBLE FOR FUTURE SALE

The Company cannot predict the effect, if any, that future sales
of shares of Common Stock, or the availability of shares of Common
Stock for future sale, will have on the market price prevailing
from time to time. Sales of substantial amounts of Common Stock in
the public market, or the perception that such sales could occur,
could adversely affect prevailing market prices of the Common
Stock.

As of February 29, 1996, there were 62,315,526 shares of Common
Stock outstanding. The 10,637,500 shares of Common Stock sold in
the Offerings are freely tradable (other than by an "affiliate" of
the Company as such term is defined in the Securities Act) without
restriction or registration under the Securities Act. The
50,750,000 shares of Common Stock that are owned by BCC (the
"Restricted Shares") were issued and sold by the Company in a
private transaction and may not be resold by BCC unless registered
under the Securities Act or sold in accordance with an exemption
therefrom, such as Rule 144 or Rule 144A thereunder.

In general, under Rule 144 as currently in effect, a holder of
Restricted Shares who beneficially owns shares that were not
acquired from the Company or an affiliate of the Company within the
previous two years would be entitled to sell within any three-month
period a number of shares that does not exceed the greater of
(i) one percent of the then outstanding shares of Common Stock or
(ii) the average weekly trading volume of the Common Stock on the
New York Stock Exchange during the four calendar weeks immediately
preceding the date on which notice of the sale is filed with the
Securities and Exchange Commission. BCC will be able to sell
shares of Common Stock pursuant to such provision after April 1,
1997. Sales pursuant to Rule 144 are also subject to certain other
requirements relating to manner of sale, notice, and the
availability of current public information about the Company. A
person who is deemed not to have been an affiliate of the Company
at any time during the three months immediately preceding a sale
and who beneficially owns shares that were not acquired from the
Company or an affiliate of the Company within the past three years
is entitled to sell such shares under Rule 144(k) without regard to
the foregoing limitations. Rule 144A under the Securities Act
permits the immediate sale by the holders of Restricted Shares
issued prior to completion of the Offerings of all or a portion of
their shares to certain "qualified institutional buyers" as defined
in Rule 144A.

The shares of Common Stock covered by this Prospectus will, when
issued by the Company in connection with business combination
transactions, be freely tradable, except that persons who are
deemed to be affiliates of the acquired entity in such business
combination transaction may resell such shares only in transactions
permitted by the resale provisions of Rule 145 under the Securities
Act (or Rule 144 in the case of such persons who are or become
affiliates of the Company). Securities resold in reliance on Rule
145 can be sold subject to the requirements under Rule 144
concerning the availability of current public information regarding
the Company, limitations on volume, and the manner of sale.

The Company has registered under the Securities Act all
shares reserved for issuance under the DSOP and the Stock Option
Plan. All shares purchased in the future under such plans will be
available for resale in the public market without restriction,
except that affiliates must comply with the provisions of Rule 144
other than the holding period requirement.

EXPERTS

The financial statements of the Company as of December 31, 1994
and 1995 and for each of the periods ended December 31, 1993, 1994,
and 1995 included in this Prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are included herein in reliance
upon the authority of said firm as experts in accounting and
auditing in giving said report.

The financial statements of Grand & Toy Limited as at April 2,
1995 and for the year then ended included in this Prospectus have
been audited by Coopers & Lybrand, independent chartered
accountants, as indicated in their report with respect thereto, and
are included herein in reliance upon the authority of said firm as
experts in accounting and auditing in giving said report.

The financial statements of Word Technology Systems, Inc. as of
December 31, 1994 and 1993 and for the years then ended included in
this Prospectus have been audited by Deloitte & Touche LLP,
independent auditors as stated in their report appearing herein,
and are included in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.

The financial statements of Neat Ideas Limited as at December
31, 1995, and for the year then ended included in this Prospectus
have been audited by Buzzacott, independent chartered accountants,
as indicated in their report with respect thereto, and are included
herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said report.

<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS

Page
Unaudited Boise Cascade Office Products Corporation and
Subsidiaries Condensed Interim Financial Statements for
the Three Months Ended March 31, 1995 and 1996
Statements of Income for the Three Months
Ended March 31, 1995 and 1996 F-3
Balance Sheets as of March 31, 1995 and 1996
and as of December 31, 1995 F-4
Statements of Cash Flows for the Three Months
Ended March 31, 1995 and 1996 F-6
Notes to Financial Statements F-7

Boise Cascade Office Products Corporation and Subsidiaries
Report of Independent Public Accountants F-10
Statements of Income for the Years Ended
December 31, 1993, 1994, and 1995 F-11
Balance Sheets as of December 31, 1994 and 1995 F-12
Statements of Cash Flows for the Years Ended
December 31, 1993, 1994, and 1995 F-14
Statements of Shareholders' Equity for the Years Ended
December 31, 1993, 1944, and 1995 F-15
Notes to Financial Statements F-16

Word Technology Systems, Inc.
Report of Independent Public Accountants F-28
Audited Balance Sheets as of December 31, 1994 and 1993 F-29
Audited Statements of Income and Retained Earnings for the Years
Ended December 31, 1994 and 1993 F-30
Audited Statements of Cash Flows for the Years Ended
December 31, 1994 and 1993 F-31
Notes to Financial Statements F-32
Unaudited Balance Sheet as of September 29, 1995 F-35
Unaudited Statements of Income and Retained Earnings for the
Nine Months Ended September 29, 1995 and September 30, 1994 F-36
Unaudited Statements of Cash Flows for the Nine
Months Ended September 29, 1995 and September 30, 1994 F-37
Notes to Unaudited Financial Statements F-38

Neat Ideas Limited
Report of the Director F-41
Report of the Auditors F-43
Profit and Loss Account for the Year Ended 31st December, 1995 F-44
Balance Sheet - 31st December, 1995 F-45
Cash Flow Statement for the Year Ended 31st December, 1995 F-46
Notes to the Accounts - 31st December, 1995 F-47

Grand & Toy Limited
Auditors Report F-54
Audited Balance Sheet as at April 2, 1995 F-55
Audited Statement of Retained Earnings for the Year Ended
April 2, 1995 F-56
Audited Statement of Earnings for the Year Ended April 2, 1995 F-57
Audited Statement of Cash Flow for the Year Ended April 2, 1995 F-58
Notes to Financial Statements F-59
F-1

<PAGE>
Unaudited Balance Sheet as at January 7, 1996 and
January 8, 1995 F-63
Unaudited Statement of Retained Earnings for the 40 Weeks
Ended January 7, 1996 and January 8, 1995 F-64
Unaudited Statement of Earnings for the 40 Weeks Ended
January 7, 1996 and January 8, 1995 F-65
Unaudited Statement of Cash Flow for the 40 Weeks Ended
January 7, 1996 and January 8, 1995 F-66
Unaudited Notes to Financial Statements F-67

Unaudited Boise Cascade Office Products Corporation and
Subsidiaries Pro Forma Condensed Financial Statements for 1995
Basis of Preparation F-70
Pro Forma Condensed Statement of Income for the Year Ended
December 31, 1995 F-72
Pro Forma Condensed Statement of Income for the Three
Months Ended March 31, 1996 F-73
Notes to Pro Forma Condensed Financial Statements F-74

F-2
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES
STATEMENTS OF INCOME
(unaudited)

Three Months Ended March 31
1995 1996
(expressed in thousands,
except per share data)

Net sales $ 303,287 $ 461,423
Cost of sales, including purchases
from Boise Cascade Corporation
of $34,464,000 and $42,595,000 231,466 338,526
__________ __________
Gross profit 71,821 122,897
__________ __________

Selling and warehouse operating
expense 54,311 87,095
Corporate general and administrative
expense, including amounts paid to
Boise Cascade Corporation of $698,000
and $586,000 4,761 6,854
Goodwill amortization 440 1,380
__________ __________
59,512 95,329
__________ __________
Income from operations 12,309 27,568
Other income (expense), net 243 (1,241)
__________ __________

Income before income taxes 12,552 26,327
Income tax expense 4,833 10,764
__________ __________
Net income $ 7,719 $ 15,563

Earnings per common share and
pro forma earnings per common share,
after giving effect to a two-for-one
stock split (based upon 61,387,500
pro forma average common shares outstanding
for the three months ended March 31,
1995, and 62,305,746 actual
average common shares outstanding for
the three months ended March 31, 1996) $ .13 $ .25

The accompanying notes are an integral part of these Financial Statements.
F-3
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

BALANCE SHEETS
(unaudited)

March 31 December 31
1995 1996 1995
(expressed in thousands)
ASSETS

Current
Cash and short-term investments $ 21 $ 13,138 $ 14,082
Receivables, less allowances
of $1,129,000, $3,123,000,
and $2,889,000 141,413 232,325 189,260
Inventories 88,927 130,030 112,538
Deferred income tax benefits 5,547 8,156 7,588
Other 8,264 14,218 12,705
__________ __________ __________
244,172 397,867 336,173
__________ __________ __________
Property
Land 11,779 12,411 12,411
Buildings and improvements 57,907 66,342 66,217
Furniture and equipment 90,816 114,634 102,074
Accumulated depreciation (84,201) (79,814) (91,941)
__________ __________ __________
76,301 113,573 88,761
__________ __________ __________
Goodwill, net of amortization
of $3,803,000, $6,960,000,
and $5,650,000 57,303 206,637 114,919

Other assets 4,307 5,319 4,271
__________ __________ __________
Total assets $ 382,083 $ 723,396 $ 544,124

The accompanying notes are an integral part of these Financial Statements.

F-4
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

BALANCE SHEETS
(unaudited)

March 31 December 31
1995 1996 1995
(expressed in thousands)
LIABILITIES AND SHAREHOLDERS' EQUITY

Current
Notes payable $ - $ 6,000 $ -
Current portion of long-term debt - 219 -
Accounts payable
Trade and other 76,088 157,826 116,363
Boise Cascade Corporation - 12,774 23,906
__________ __________ __________
76,088 170,600 140,269
__________ __________ __________
Accrued liabilities
Compensation and benefits 11,932 14,774 17,959
Income taxes payable - 11,805 4,712
Taxes, other than income 12,241 7,467 6,813
Interest payable - 562 -
Other 12,234 25,124 20,596
__________ __________ __________
36,407 59,732 50,080
__________ __________ __________
112,495 236,551 190,349
__________ __________ __________
Other
Deferred income taxes 3,024 2,727 2,534
Long-term debt, less current portion - 110,143 -
Other 1,817 18,622 11,824
__________ __________ __________
4,841 131,492 14,358
__________ __________ __________
Shareholders' equity
Common stock, $.01 par value,
200,000,000 shares authorized;
62,331,258 and 62,292,776 shares
issued and outstanding at
March 31, 1996, and December 31, 1995,
after giving effect to a two-for-one
stock split - 623 623
Additional paid-in capital 257,028 295,793 295,615
Retained earnings 7,719 58,937 43,179
__________ __________ __________
Total shareholders' equity 264,747 355,353 339,417
__________ __________ __________
Total liabilities and
shareholders' equity $ 382,083 $ 723,396 $ 544,124

The accompanying notes are an integral part of these Financial Statements.

F-5
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

STATEMENTS OF CASH FLOWS
(unaudited)

Three Months Ended March 31
1995 1996
(expressed in thousands)

Cash provided by (used for) operations
Net income $ 7,719 $ 15,563
Items in income not using (providing) cash
Depreciation and amortization 3,495 5,279
Deferred income tax benefit (948) 934
Receivables (16,217) (3,130)
Inventories (4,694) 5,888
Other current assets (1,477) 2,561
Accounts payable and accrued liabilities (2,113) (5,784)
Current and deferred income taxes (769) 4,889
__________ __________
Cash provided by (used for) operations (15,004) 26,200
__________ __________

Cash provided by (used for) investment
Expenditures for property and equipment (5,897) (10,587)
Acquisitions (3,289) (129,259)
Other, net 688 (3,416)
__________ __________
Cash used for investment (8,498) (143,262)
__________ __________
Cash provided by (used for) financing
Notes payable - 6,000
Additions to long-term debt - 110,000
Net equity transactions with Boise
Cascade Corporation 23,595 -
Other, net (95) 118
__________ __________
Cash provided by financing 23,500 116,118
__________ __________

Decrease in cash (2) (944)
Balance at beginning of the period 23 14,082
__________ __________

Balance at March 31 $ 21 $ 13,138

The accompanying notes are an integral part of these Financial Statements.

F-6
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO FINANCIAL STATEMENTS
(unaudited)

(1) ORGANIZATION AND BASIS OF PRESENTATION. Boise Cascade Office
Products Corporation (together with its subsidiaries, "the Company")
was operated as the Boise Cascade Office Products Distribution
Division ("the Division") of Boise Cascade Corporation ("BCC") prior
to April 1, 1995. Effective on that date, pursuant to an Asset
Transfer and Subscription Agreement between the Company and BCC, BCC
transferred to the Company (the "Transfer of Assets") substantially
all of the assets and liabilities associated with the Division, other
than $100 million of accounts receivable, in exchange for common
stock of the Company. After the transfer, BCC held a total of
50,750,000 shares, after giving effect to a two-for-one stock split,
of the Company's common stock (see Note 3). The accompanying
historical consolidated income statements include the consolidated
results of operations of the Division.

The quarterly financial statements of the Company and its
subsidiaries have not been audited by independent public accountants,
but in the opinion of management, all adjustments necessary to
present fairly the results for the periods have been included.
Except as may be disclosed in the notes to the Financial Statements,
the adjustments made were of a normal, recurring nature. Quarterly
results are not necessarily indicative of results that may be
expected for the year. The statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations. These quarterly
financial statements should be read together with the statements and
the accompanying notes included in the Company's 1995 Annual Report.

(2) PUBLIC OFFERINGS. On April 13, 1995, the Company completed the sale
of 10,637,500 shares of common stock at a price of $12.50 per share,
after giving effect to a two-for-one stock split, in an initial
public offering in the United States and in a concurrent
international offering ("the Offerings"). After the Offerings, BCC
owned 82.7% of the Company's outstanding common stock. The net
proceeds to the Company were approximately $123.1 million. A total
of $100 million of such net proceeds was used by the Company to
replace the working capital retained by BCC in the Transfer of
Assets. Of the remaining proceeds, $21.2 million was retained by the
Company and was available for general corporate purposes, and
$1.9 million was paid as a dividend to BCC.

(3) EARNINGS PER COMMON SHARE. The unaudited pro forma earnings per
common share of $.13 for the three months ended March 31, 1995, have
been presented assuming the 50,750,000 common shares issued to BCC in
the organization of the Company and the 10,637,500 common shares
issued in the Offerings, after giving effect to a two-for-one stock

F-7

<PAGE>
split, were issued on January 1, 1995. Actual earnings per common
share of $.25 for the three months ended March 31, 1996, are based
upon the average number of common shares outstanding pursuant to the
shares issued to BCC in the organization of the Company and the
Transfer of Assets on April 1, 1995, the shares issued in the
Offerings on April 13, 1995, common shares issued to effect
acquisitions made by the Company, and shares issued as a result of
stock options exercised, all after giving effect to a two-for-one
stock split.

In April 1996, the Company's board of directors authorized a two-for-
one split of the Company's common stock in the form of a 100% stock
dividend. Each shareholder of record at the close of business on
May 6, 1996, will receive one additional share for each share held on
that date. The new shares will be distributed on May 20, 1996. All
share amounts, net income per share, and average common shares
outstanding have been restated to reflect the stock split for each
period presented.

(4) DEBT. At March 31, 1996, the Company had a $225 million revolving
credit agreement with a group of banks. Borrowing under this
agreement was $110 million. In addition, the Company had $6 million
of short-term borrowings.

(5) TAXES. The estimated tax provision rate for the first three months
of 1995 was 38.5% compared with a tax provision rate of 41% for the
same period in 1996. The increase is primarily due to the
amortization of goodwill arising from certain acquisitions that is
not deductible for tax purposes.

(6) ACQUISITIONS. During the first quarter of 1996, the Company made
five acquisitions which were accounted for under the purchase method
of accounting. Accordingly, the purchase prices were allocated to
the assets acquired and liabilities assumed based upon their
estimated fair values. The initial purchase price allocations may be
adjusted within one year of the date of purchase for changes in
estimates of the fair values of assets and liabilities. Such
adjustments are not expected to be significant to results of
operations or the financial position of the Company. The excess of
the purchase price over the estimated fair value of the net assets
acquired was recorded as goodwill and is being amortized over
40 years. The results of operations of the acquired businesses are
included in the Company's operations subsequent to the dates of
acquisition.

On February 5, 1996, the Company completed the acquisition of 100% of
the shares of Grand & Toy Limited (Grand & Toy) from Cara Operations
Limited (Toronto). The negotiated purchase price was approximately
C$140 million (US$104 million). In addition, the Company recorded
liabilities of approximately $7.4 million, which are included in the
recorded purchase price of Grand & Toy, to modify and transition
activities such as distribution, marketing, and other functions.
Further adjustments to the preliminary allocation of the purchase
price may be made within one year of the acquisition date. The
acquisition was funded primarily from borrowings under the Company's

F-8

<PAGE>
$225 million revolving credit agreement. Grand & Toy owns and
operates six office products distribution centers and approximately
80 retail stores across Canada.

On January 31, 1996, the Company acquired the assets of the contract
stationer business of Sierra Vista Office Products, Inc., based in
Albuquerque, New Mexico. On February 9, 1996, the Company acquired
the stock of the contract stationer businesses of Loring, Short &
Harmon, Inc., based in Portland, Maine, and McAuliffe's based in
Burlington, Vermont. On March 29, 1996, the Company acquired the
stock of the contract stationer and office furniture business of
Office Essentials based in Milwaukee, Wisconsin. These businesses
were acquired for a total of $27.2 million in cash and $7.9 million
payable to the sellers.

Unaudited pro forma results of operations, reflecting these
acquisitions, would have been as follows. If these businesses had
been acquired on January 1, 1995, first quarter 1995 sales would have
increased to $370 million, net income would have decreased to
$5.3 million and earnings per common share, after giving effect to a
two-for-one stock split, would have decreased to $.09. In the first
quarter of 1995, Grand & Toy recorded a restructuring charge.
Excluding the impact of this restructuring charge, pro forma net
income and earnings per share would have been essentially unchanged.
If these five businesses had been acquired on January 1, 1996, the
Company's first quarter 1996 sales would have increased to
$491 million, net income would have decreased slightly to
$15.4 million and earnings per common share, after giving effect to a
two-for-one stock split, would have remained $.25. This unaudited
pro forma financial information does not necessarily represent the
actual consolidated results of operations that would have resulted if
the acquisitions had occurred on the dates assumed.

In April 1996, the Company announced it had signed letters of intent
to acquire Crawford's Office Supplies, Inc., based in Seattle,
Washington; Zemlick Brothers, Inc., based in Kalamazoo, Michigan;
Bangs Office Products, Inc., based in Pocatello, Idaho; and Pedersen
Contact based in Melbourne, Australia. The combined annual sales of
the acquisitions at the time of announcement were $63.3 million. The
Company also announced the start-up of new office products
distribution centers in Las Vegas, Nevada, and Miami, Florida.

In April 1996, the Company filed a registration statement with the
Securities and Exchange Commission for additional shares of common
stock, which provides the Company with approximately 4,000,000 of
uncommitted registered shares of common stock, after a two-for-one
stock split, to be offered from time to time in connection with
future acquisitions.

F-9

<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors of Boise
Cascade Office Products Corporation:

We have audited the accompanying balance sheets of Boise Cascade Office
Products Corporation (a Delaware corporation) and subsidiaries as of
December 31, 1994 and 1995, and the related statements of income, cash
flows, and shareholders' equity for the years ended December 31, 1993, 1994,
and 1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Boise Cascade
Office Products Corporation as of December 31, 1994 and 1995, and the
results of their operations and their cash flows for each of the three years
in the period ended December 31, 1995 in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP

Boise, Idaho
January 26, 1996
(except with respect to
matters discussed in
Note 12 as to which the
date is May 20, 1996)

F-10
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

STATEMENTS OF INCOME

Year Ended December 31

1993 1994 1995

(expressed in thousands)

Net sales $ 682,819 $ 908,520 $1,315,953
Cost of sales, including inventory
purchased from Boise Cascade Corporation
of $45,581,000, $69,566,000, and
$158,512,000 (Note 6) 505,993 676,515 980,564
__________ __________ __________

Gross profit 176,826 232,005 335,389
__________ __________ __________

Selling and warehouse operating
expense (Note 2) 134,331 172,876 238,885
Corporate general and administrative expense,
including amounts paid to Boise Cascade
Corporation of $2,630,000, $2,710,000, and
$2,382,000 (Note 6) 13,247 15,541 24,750
Goodwill amortization (Note 2) 471 1,389 2,287
__________ __________ __________
148,049 189,806 265,922
__________ __________ __________

Income from operations 28,777 42,199 69,467

Other income, net 681 995 1,903
__________ __________ __________

Income before income taxes 29,458 43,194 71,370

Income tax expense (Note 4) 11,412 16,729 28,191
__________ __________ __________

Net income $ 18,046 $ 26,465 $ 43,179

Pro forma earnings per common share (Note 2)
(based upon 50,750,000 pro forma average
common shares outstanding for the years
ended December 31, 1993 and 1994, and
58,687,428 pro forma average common shares
outstanding for the year ended December 31,
1995 $ .36 $ .52 $ .74

(based upon 61,387,500 pro forma average
common shares outstanding for the years
ended December 31, 1993 and 1994, and
61,660,100 pro forma average common shares
outstanding for the year ended
December 31, 1995) $ .29 $ .43 $ .70

The accompanying notes are an integral part of these Financial Statements.

F-11
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

BALANCE SHEETS

December 31
ASSETS 1994 1995
(expressed in thousands)

Current
Cash and short-term investments $ 23 $ 14,082
Receivables, less allowances of
$1,210,000 and $2,889,000 123,374 189,260
Inventories (Note 2) 83,847 112,538
Deferred income tax benefits (Note 4) 4,247 7,588
Other 6,770 12,705
__________ __________
218,261 336,173
__________ __________
Property (Note 2)
Land 11,779 12,411
Buildings and improvements 56,997 66,217
Furniture and equipment 86,186 102,074
Accumulated depreciation (81,704) (91,941)
__________ __________
73,258 88,761
__________ __________

Goodwill, net of amortization of $3,363,000
and $5,650,000 (Note 2) 55,699 114,919
Other assets (Note 2) 5,151 4,271
__________ __________

Total assets $ 352,369 $ 544,124

The accompanying notes are an integral part of these Financial Statements.

F-12
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

BALANCE SHEETS

December 31
LIABILITIES AND SHAREHOLDERS' EQUITY 1994 1995
(expressed in thousands)

Current
Accounts payable
Trade and other $ 73,144 $ 116,363
Boise Cascade Corporation (Note 6) 8,815 23,906
__________ __________
81,959 140,269
__________ __________
Accrued liabilities
Compensation and benefits 11,525 17,959
Income taxes payable (Note 4) - 4,712
Taxes, other than income 10,166 6,813
Other (Note 9) 9,776 20,596
__________ __________
31,467 50,080
__________ __________
113,426 190,349
__________ __________
Other
Deferred income taxes (Note 4) 3,919 2,534
Other (Note 9) 1,592 11,824
__________ __________
5,511 14,358
__________ __________

Commitments and contingent liabilities (Notes 8, 9, and 10)

Shareholders' equity (Note 7)
Common stock, $.01 par value, 200,000,000
shares authorized; 62,292,776 shares
issued and outstanding at December 31,
1995 - 623
Additional paid-in capital 233,432 295,615
Retained earnings - 43,179
__________ __________
Total shareholders' equity 233,432 339,417
__________ __________

Total liabilities and shareholders' equity $ 352,369 $ 544,124

The accompanying notes are an integral part of these Financial Statements.

F-13
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

STATEMENTS OF CASH FLOWS

Year Ended December 31
1993 1994 1995
(expressed in thousands)

Cash provided by (used for) operations
Net income $ 18,046 $ 26,465 $ 43,179
Items in income not using (providing) cash
Depreciation and amortization 12,891 12,985 15,355
Write-off of deferred software
costs (Note 2) 5,236 - -
Deferred income tax benefit (3,346) (321) (1,914)
Receivables (10,086) (16,224) (34,006)
Inventories 2,283 (9,321) (14,529)
Other current assets (1,031) (272) (5,405)
Accounts payable and accrued liabilities 6,730 18,417 45,579
Current and deferred income taxes (35) (24) 1,463
__________ __________ __________

Cash provided by operations 30,688 31,705 49,722
__________ __________ __________

Cash provided by (used for) investment
Expenditures for property and equipment (2,907) (6,487) (22,246)
Acquisitions (Note 9) - (78,454) (61,638)
Other, net 12 (3,355) 4,309
__________ __________ __________

Cash used for investment (2,895) (88,296) (79,575)
__________ __________ __________

Cash provided by (used for) financing
Sale of stock - - 123,076
Net equity transactions with
Boise Cascade Corporation (Note 6) (27,793) 57,148 (78,447)
Other, net - (554) (717)
__________ __________ __________

Cash provided by (used for) financing (27,793) 56,594 43,912
__________ __________ __________
Increase in cash - 3 14,059

Balance at beginning of the year 20 20 23
__________ __________ __________

Balance at end of the year $ 20 $ 23 $ 14,082

The accompanying notes are an integral part of these Financial Statements.

F-14
<PAGE>
<TABLE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

STATEMENTS OF SHAREHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 1993, 1994, AND 1995

<CAPTION>
Total Addi-
Common Share- tional
Shares holders' Common Paid-In Retained
Outstanding Equity Stock Capital Earnings
(expressed in thousands)

<C> <S> <C> <C> <C> <C>
Balance at December 31, 1992 $159,566 $ - $159,566 $ -

_____________________________________________________________________________________
Net income 18,046 18,046
Net equity transactions with
Boise Cascade Corporation (27,793) (27,793)

_____________________________________________________________________________________
Balance at December 31, 1993 149,819 149,819

_____________________________________________________________________________________
Net income 26,465 26,465
Net equity transactions with
Boise Cascade Corporation 57,148 57,148

_____________________________________________________________________________________
Balance at December 31, 1994 233,432 233,432

_____________________________________________________________________________________
Net income 43,179 43,179
Net equity transactions with
Boise Cascade Corporation (78,447) (78,447)
62,292,776 Issuance of stock 135,262 623 134,639
Other 5,991 5,991

_____________________________________________________________________________________
62,292,776 Balance at December 31, 1995 $339,417 $ 623 $295,615 $ 43,179

</TABLE>

The accompanying notes are an integral part of these Financial Statements.

F-15
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND BASIS OF PRESENTATION

Boise Cascade Office Products Corporation (together with its
subsidiaries, the "Company"), headquartered in Itasca, Illinois, is
one of the largest North American distributors of office supplies,
office furniture, and other office products directly to large
corporate, government, and other offices through its contract
stationer business, as well as to home offices and small- and medium-
sized businesses in the United States and Great Britain through its
direct-marketing channel. The Company was incorporated on January 3,
1995, and until April 13, 1995, was a wholly owned subsidiary of
Boise Cascade Corporation (BCC). The Company consists of the former
Boise Cascade Office Products Distribution Division (the "Division")
whose assets (including the stock of the two wholly-owned
subsidiaries of BCC but excluding certain accounts receivable) and
liabilities (see Note 3) were transferred to the Company (the
"Transfer of Assets") effective April 1, 1995 (the "Transfer Date")
and subsequent acquisitions made by the Company.

The accompanying historical consolidated financial statements include
the consolidated financial position and results of operations of the
Division prior to the Transfer Date. BCC's net investment in the
Company prior to the Transfer Date, including net cash transfers of
the Division, has been reflected in "Additional paid-in capital" in
the financial statements. Results of operations of the Company prior
to 1995 are also included in "Additional paid-in capital." All
significant intercompany transactions have been eliminated. These
financial statements may not necessarily be representative of results
that would have been attained if the above entities had operated
within a separate consolidated entity.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS. Cash and cash equivalents include short-
term investments with original maturities of three months or less.

INVENTORIES. Inventories consist of finished goods and are valued at
the lower of cost or market with cost based on an approximation of
the first-in, first-out valuation method.

CATALOGS. Costs of producing and distributing sales catalogs are
capitalized and charged to expense in the periods in which the
related sales occur.

F-16

<PAGE>
PROPERTY. Property and equipment are recorded at cost. Cost
consists of expenditures for major improvements and replacements
including interest cost associated with capital additions. No
interest was capitalized in 1993, 1994, or 1995. Depreciation is
computed using the straight-line method. Gains and losses from sales
and retirements are included in income as they occur. Estimated
service lives of principal items of property and equipment range from
3 to 40 years.

DEFERRED SOFTWARE COSTS. The Company defers software costs that
benefit future years. These costs are amortized on the straight-line
method over a maximum of five years or the expected life of the
product, whichever is less. "Other assets" in the Balance Sheets
include deferred software costs of $3,977,000 and $3,070,000 at
December 31, 1994 and 1995.

Amortization of deferred software costs totaled $2,321,000,
$1,146,000, and $907,000 in 1993, 1994, and 1995 and is included in
"Selling and warehouse operating expense." In addition, "Selling and
warehouse operating expense" includes the write-off of $5,236,000 in
1993 of deferred costs for software that was determined to have
limited future value.

COST OF SALES. Cost of sales related to merchandise inventory is
primarily determined using estimated product costs and adjusted to
actual at the time of physical inventories which are taken at all
locations at least annually. Additional adjustments to reflect
actual experience are recognized as appropriate throughout the year.
Cost of sales also includes delivery and occupancy expenses.

EARNINGS PER COMMON SHARE. Pro forma earnings per common share of
$.36 and $.52 for the years ended December 31, 1993 and 1994, have
been presented assuming the 50,750,000 common shares issued to BCC
were issued at the beginning of the years presented. Pro forma
earnings per common share of $.74 for the year ended December 31,
1995, have been presented assuming the 50,750,000 common shares
issued to BCC had taken place on January 1, 1995, the 10,637,500
common shares issued in the Offerings were issued on April 13, 1995,
and 905,276 common shares were issued during the year to effect
various acquisitions made by the Company, for a total of 58,687,428
average common shares outstanding. Pro forma earnings per common
share of $.29 and $.43 for the years ended December 31, 1993 and
1994, have been presented assuming the 50,750,000 common shares
issued to BCC and the 10,637,500 common shares issued in the
Offerings for a total of 61,387,500 were issued at the beginning of
the years presented. Pro forma earnings per common share of $.70 for
the year ended December 31, 1995, has been presented assuming the
50,750,000 common shares issued to BCC and the 10,637,500 common
shares issued in the Offerings had taken place on January 1, 1995,
and the 905,276 common shares were issued during the year to effect
various acquisitions, for a total of 61,660,100 average common shares
outstanding. The pro forma earnings per common share data are not
necessarily indicative of what actual earnings per common share would
have been had these issuances of common shares occurred on the basis
assumed.

F-17

<PAGE>
INCOME TAXES. Prior to 1993, the Company accounted for income taxes
under Accounting Principles Board Opinion No. 11. The Company
adopted Financial Accounting Standards Board (FASB) Statement 109,
"Accounting for Income Taxes" (SFAS 109) at the beginning of 1993, as
the cumulative effect of an accounting change. SFAS 109 requires
that deferred taxes be provided on temporary differences between the
book and tax bases of assets and liabilities. In addition, the
standard requires adjustment of deferred tax liabilities to reflect
enacted changes in statutory income tax rates. The impact of
adopting SFAS 109 was not significant to the Company.

GOODWILL. Costs in excess of values assigned to the underlying net
assets of acquired companies are generally being amortized on the
straight-line method over 40 years. Annually, the Company reviews
the recoverability of goodwill. The measurement of possible
impairment is based primarily on the ability to recover the balance
of the goodwill from expected future operating cash flows of the net
tangible assets of the businesses acquired on an undiscounted basis.
In management's opinion, no such impairment exists at December 31,
1995.

PRE-OPENING COSTS. Costs associated with opening new locations are
expensed as incurred.

FINANCIAL INSTRUMENTS. The recorded value of the Company's financial
instruments, which include accounts receivable and accounts payable,
approximates market value. In the opinion of management, the Company
does not have any significant concentration of credit risks.
Concentration of credit risks with respect to trade receivables is
limited due to the wide variety of customers and channels to and
through which the Company's products are sold, as well as their
dispersion across many geographic areas. At December 31, 1995, the
Company had no derivative financial instruments.

FINANCIAL ACCOUNTING STANDARDS BOARD STATEMENTS. The FASB issued
Statement 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed Of." The Company adopted
this statement in 1995. There was no effect on the Company's
financial statements as a result of this adoption. The FASB also
issued Statement 123 "Accounting for Stock-Based Compensation." The
Company will not change its accounting for stock-based compensation,
but will make additional disclosure in its 1996 financial statements.

3. PUBLIC OFFERINGS

On April 13, 1995, the Company completed the sale of 10,637,500
shares of common stock at a price of $12.50 per share in an initial
public offering in the United States and in a concurrent
international offering (the Offerings). After the Offerings, BCC
owned 82.7% of the Company's outstanding common stock. The net
proceeds to the Company were approximately $123,076,000. A total of
$100,000,000 of such net proceeds were used by the Company to replace
the working capital retained by BCC in the Transfer of Assets. Of
the remaining proceeds, $21,217,000 was retained by the Company for
general corporate purposes, and $1,859,000 was paid as a dividend to

F-18
<PAGE>
BCC. At December 31, 1995, BCC owned 81.5% of the Company's
outstanding common stock.

4. INCOME TAXES

Income taxes are provided based on a calculation of the income tax
expense that would be incurred if the Company operated as an
independent entity. However, as long as BCC owns at least 80% of the
Company's outstanding common stock, the Company will be included in
the consolidated federal income tax return of the BCC affiliated
group. Accordingly, the Company and BCC have entered into a tax
matters agreement whereby the Company remits to BCC amounts
representing the current tax liability that the Company would incur
if it was an independent taxpayer. Pursuant to this agreement, the
Company paid BCC $20,453,000 in 1995, representing current tax
liabilities incurred after the Transfer Date. Representative amounts
for periods before the Transfer Date were included in "Net equity
transactions with Boise Cascade Corporation" and were $14,793,000,
$17,074,000, and $6,550,000 in 1993, 1994, and 1995.

The income tax expense included the following:

Year Ended December 31
1993 1994 1995
(expressed in thousands)

Current income tax provision $ 14,758 $ 17,050 $ 30,105
Deferred income tax benefit (3,346) (321) (1,914)
__________ __________ __________
Total income tax expense $ 11,412 $ 16,729 $ 28,191

A reconciliation of the statutory U.S. federal tax expense and the
Company's actual tax expense was as follows:

<TABLE>
<CAPTION>
Year Ended December 31

1993 1994 1995
Percentage Percentage Percentage
of Pretax of Pretax of Pretax
Amount Income Amount Income Amount Income
<S> <C> <C> <C> <C> <C> <C>
Statutory expense $10,310 35.0% $15,118 35.0% $24,980 35.0%
Increases (decreases)
in taxes resulting
from:
State tax
expense 1,066 3.6 1,675 3.9 2,809 3.9
All other, net 36 .1 (64) (.2) 402 .6
_______ _____ _______ _____ _______ _____
Actual tax expense $11,412 38.7% $16,729 38.7% $28,191 39.5%
</TABLE>

F-19

<PAGE>
The components of the deferred tax assets and liabilities on the Balance
Sheets at December 31, 1994, and 1995 were as follows:

December 31
1994 1995
Assets Liabilities Assets Liabilities

(expressed in thousands)

Property and equipment $ - $ 3,266 $ - $ 3,125
Accounts receivable and
unearned revenue 1,311 - 3,933 -
Deferred charges - 394 41 -
Inventories 760 - 140 -
Accrued liabilities 1,965 8 2,794 14
Goodwill - - - 1,103
State taxes - - 1,934 -
Other 219 259 695 241
________ ________ ________ ________
$ 4,255 $ 3,927 $ 9,537 $ 4,483

5. DEBT

The Company entered into a $225,000,000 revolving credit agreement
that expires in 1999 and provides for variable rates of interest based
upon customary indexes. The revolving credit facility is available
for general corporate purposes, and contains customary restrictive
financial and other covenants, including a negative pledge and
covenants specifying a minimum net worth, a minimum fixed charge
coverage ratio, and a maximum leverage ratio. The lending banks may
terminate the revolving credit agreement, and accelerate the payment
of any amounts borrowed thereunder, in the event a change of control
(as defined) of the Company occurs. There were no borrowings
outstanding at December 31, 1995.

6. TRANSACTIONS WITH BOISE CASCADE CORPORATION

The Company participated in BCC's centralized cash management system
prior to the Transfer Date. Cash receipts attributable to the
Company's operations were collected by BCC, and most cash
disbursements, including those attributable to capital improvements
and acquisitions and expansion, were funded by BCC. The net effect of
these transactions prior to the Transfer Date has been reflected in
the Company's financial statements as "Net equity transactions with
Boise Cascade Corporation" and is included in "Additional paid-in
capital" in the Balance Sheets as no common shares were issued to BCC.

F-20
<PAGE>
A summarization of net equity transactions by type is as follows:

Period
Ended
Year Ended December 31 April 13
1993 1994 1995
(expressed in thousands)

Cash collections $ (673,414) $ (893,291) $ (287,313)
Working capital retained by Boise
Cascade Corporation in the
transfer of assets - - (100,000)
Payment of accounts payable 624,272 841,530 293,592
Capital expenditures and acquisitions 2,907 84,941 9,186
Income taxes 14,793 17,074 6,550
Cash dividend to Boise Cascade
Corporation - - (1,859)
Corporate general and administrative
allocation 2,630 2,710 698
Other 1,019 4,184 699
__________ __________ __________
Net equity transactions with Boise
Cascade Corporation $ (27,793) $ 57,148 $ (78,447)

Average balance for the period $ (18,373) $ 41,323 $ 84,506

In conjunction with the Offerings, the Company and BCC have entered
into intercompany agreements pursuant to which BCC, among other
things, provides to the Company certain administrative support
functions, certain paper and paper products under a long-term sales
agreement, and use (without charge) of the trade names and trademark
of BCC.

Under the Administrative Services Agreement, BCC provides various
services to the Company that had been previously performed by BCC for
the Division. The services will be provided for varying periods,
from one to five years, identified in the Administrative Services
Agreement and are subject to renewal or termination in accordance
with the terms of such agreement. The Company will pay for each of
these services at rates set forth in the agreement. These rates are
generally consistent with amounts that have been charged by BCC in
the past. Prior to the Administrative Services Agreement, the costs
of similar services were allocated to the Company by BCC based on
estimations of BCC's costs for such services. For the years ended
December 31, 1993, 1994, and 1995, charged or allocated costs
amounted to $2,630,000, $2,710,000, and $2,382,000 and have been
included in "Corporate general and administrative expense" in the
Statements of Income.

Under the Paper Sales Agreement, the Company agreed to purchase, and
BCC agreed to sell, subject to certain exceptions, all of the
Company's cut-size paper requirements. The price to be paid by the
Company is based upon a formula meant to approximate prevailing
market prices for the paper. The agreement has an initial term of

F-21
<PAGE>
twenty years, and will be automatically renewed for five-year periods
thereafter, subject to certain conditions.

The Company supplied office products to BCC and purchased certain
paper and paper products from BCC. During the year ended
December 31, 1993, the Company's sales to BCC were $1,165,000, and
its purchases from BCC were $45,581,000. Sales and purchases during
the same period of 1994 were $1,244,000 and $69,566,000 and in 1995
were $2,046,000 and $164,417,000.

During the years presented, the Company was included as a
participating employer in the broad-based employee benefit plans
sponsored by BCC which cover the Company's work force. Most assets
and liabilities under BCC's employee benefit plans for retirement and
postretirement costs arising out of service with the Company were not
transferred to the Company by BCC. Accordingly, no significant assets
or liabilities related to retirement and postretirement benefits are
included in these financial statements.

During each of the periods presented, the employees of the Company
participated in BCC's defined benefit pension plans. In addition,
certain employees of the Company were eligible for participation in
BCC's defined contribution plans. The Statements of Income for the
years ended December 31, 1993, 1994, and 1995, include expenses of
$3,224,000, $3,754,000, and $4,159,000 attributable to participation
by the employees of the Company in BCC's plans. Postretirement
expenses attributable to participation in BCC's postretirement plans
included in the Statements of Income totaled $549,000, $201,000, and
$140,000 for the years ended December 31, 1993, 1994, and 1995.

In the fourth quarter of 1993, BCC and the Company adopted FASB
requirements to accrue certain severance, disability, and other
benefits provided to former or inactive employees. The amount of
that charge was not significant to the Company.

7. SHAREHOLDER'S EQUITY

BCC's net investment in the Company prior to the Transfer Date
including results of operations and net cash transfers of the
Division has been reflected as "Additional paid-in capital" in the
financial statements. On January 3, 1995, the Company was
incorporated and has authorized capital consisting of 200,000,000
shares of common stock, $.01 par value, and 20,000,000 shares of
preferred stock, $.01 par value. BCC was issued 50,750,000 shares of
common stock in connection with the incorporation of the Company and
Transfer of Assets on April 1, 1995. After the Offerings discussed
in Note 3, the Company had 61,387,500 shares of common stock
outstanding.

On June 30, 1995, the Company filed a registration statement with the
Securities and Exchange Commission for 4,000,000 shares of common
stock to be offered by the Company from time to time in connection
with future acquisitions. The registration statement became
effective on August 4, 1995. At December 31, 1995, the Company had

F-22
<PAGE>
2,590,832 uncommitted shares remaining under this registration
statement.

In February 1995, the Company adopted a Key Executive Stock Option
Plan (KESOP) and a Director Stock Option Plan (DSOP). A total of
3,000,000 and 150,000 shares, respectively, were reserved for
issuance under these plans.

The KESOP provides for the granting of options to key employees,
including officers of the Company and its subsidiaries. The
Compensation Committee of the board of directors fixes the grant
price, duration of the option, number of shares subject to option,
vesting requirements, and other terms. The exercise price of options
granted cannot be less than the fair market value of the shares of
the Company's common stock on the date of grant of the option.
During 1995, 647,400 options were granted at a price range of
$12.50 - $18.75. At December 31, 1995, no options were exercisable.

Under the DSOP, each director who is not an employee of the Company
or BCC will receive a stock option grant on July 31. Directors
elected between July 31 and December 31 will also receive a grant
when they are elected to the board. On April 6, 1995, the Company's
three nonemployee directors were granted an option to purchase 4,000
shares of the Company's common stock at the initial public offering
price of $12.50 per share. The options are exercisable one year
following the date of grant and expire the earlier of three years
after the director ceases to be a director or ten years after the
grant date.

8. LEASES

Rental expenses for operating leases, net of sublease rentals, were
$5,777,000 in 1993, $8,354,000 in 1994, and $10,682,000 in 1995.

The Company has various operating leases with remaining terms of more
than one year. These leases have minimum lease payment requirements,
net of sublease rentals, of $7,628,000 for 1996, $6,353,000 for 1997,
$5,285,000 for 1998, $4,929,000 for 1999, and $3,753,000 for 2000,
with total payments thereafter of $14,808,000.

Substantially all lease agreements have fixed payment terms based
upon the lapse of time. Certain lease agreements provide the Company
with the option to purchase the leased property. In addition,
certain lease agreements contain renewal options exercisable by the
Company ranging up to 15 years, with fixed payment terms similar to
those in the original lease agreements.

The Company also leases certain equipment and buildings under capital
leases; aggregate obligations under capital leases approximated
$643,000 at December 31, 1994 and, $412,000 at December 31, 1995.

F-23
<PAGE>
9. ACQUISITIONS

In 1994 and 1995, the Company made various acquisitions, all of
which were accounted for under the purchase method of accounting.
Accordingly, the purchase prices were allocated to the assets
acquired and liabilities assumed based upon their estimated fair
values. The initial purchase price allocations may be adjusted
within one year of the date of purchase for changes in estimates
of the fair values of assets and liabilities. Such adjustments
are not expected to be significant to results of operations or the
financial position of the Company. The excess of the purchase
price over the estimated fair value of the net assets acquired was
recorded as goodwill and is being amortized over 40 years. The
results of operations of the acquired businesses are included in
the Company's operations subsequent to the dates of acquisitions.

On April 30, 1994, the Company purchased the net assets of the
direct-mail office supply business of The Reliable Corporation
(Reliable) for $71,306,000 in cash. Assuming the acquisitions of
Reliable had occurred on January 1, 1993, unaudited pro forma
results of operations for the year ended December 31, 1993, would
have been sales of $837,919,000, net income of $21,546,000, and
earnings per common share, assuming 61,387,500 common shares
outstanding of $.35. Unaudited pro forma results of the Company's
operations for the year ended December 31, 1994, assuming the
acquisition of Reliable had occurred on January 1, 1994, would
have been sales of $962,020,000, net income of $28,365,000, and
earnings per common share, assuming 61,387,500 average common
shares outstanding of $.46. On March 31, and December 29, 1994,
the Company purchased the net assets of office supply distribution
businesses in Georgia and Florida, respectively. In conjunction
with these acquisitions, the Company paid $7,148,000 in cash. The
pro forma impact of these acquisitions on the Company's results of
operations was not significant.

On February 17, April 3, July 28, October 31, December 1, and
December 29, 1995, the Company purchased the net assets of office
supply distribution businesses in Ohio, Virginia, Kentucky,
Florida, Pennsylvania, and the United Kingdom, for a total of
$39,389,000 in cash and $5,129,000 payable to the sellers, most of
which is due within one year, and is recorded in "Other current
liabilities" at December 31, 1995.

On August 25, and September 1, 1995, the Company acquired the
stock of office supply distribution businesses in Ohio and Idaho
by issuing 473,924 shares of common stock valued at approximately
$6,200,000 and the payment of $1,002,000 in cash and $443,000
payable to the sellers over three years.

On September 29, 1995, the Company acquired the net assets of
office and computer supply distribution businesses in New York and
Missouri by issuing 431,352 shares of common stock and the
equivalent of 434,390 shares of common stock in a stock note,
payable by issuing the shares at the end of two years. These
share issuances were valued at approximately $11,985,000. Cash of

F-24
<PAGE>
$21,747,000 was also paid. A maximum of 22,702 shares may be
issued in 1996, dependent upon the final valuations of the net
assets acquired. The Company also agreed to issue at least
$999,000 worth of stock, payable in equal installments at the end
of each of the three years following closing. As part of the
purchase, a liability was recorded for this amount. This amount
may increase if certain earnings levels are achieved. The number
of shares ultimately issued will be dependent on average share
prices prior to the issuance of the shares and the earnings levels
achieved. Based on the closing share price of the stock at
December 31, 1995, and before considering any increases due to the
achievement of the specified earnings levels, approximately 46,800
shares would be issuable under this agreement. Also in
conjunction with these acquisitions, the Company agreed to pay
$2,000,000 in each of the two years following closing if certain
earnings levels are achieved. As part of the purchase, a
liability was recorded for this amount.

Unaudited pro forma results of the Company's operations for the
year ended December 31, 1994, assuming the above acquisitions had
occurred January 1, 1994, would have been sales of $1,121,120,000,
net income of $29,525,000, and earnings per common share, assuming
61,387,500 average common shares outstanding of $.48. Unaudited
pro forma results of the Company's operations for the year ended
December 31, 1995, assuming the above acquisitions had occurred
January 1, 1995, would have been sales of $1,476,493,000, net
income of $45,209,000, and earnings per common share, assuming
61,660,100 average common shares outstanding of $.73.

The Company has announced that it will acquire in 1996 Grand &
Toy, Ltd., a national office products distributor in Canada for
about $104,000,000 and will also acquire two additional contract
stationer businesses in the United States. The annual sales of
these three businesses at the time of announcement were
approximately $281,000,000. The Company funds its acquisitions
through its common stock offering in April 1995, operating cash
flow, issuance of additional equity securities, and anticipated
borrowings under its $225,000,000 revolving credit facility.

The above referenced unaudited pro forma financial information
does not necessarily represent the actual consolidated results of
operations that would have resulted if the acquisitions had
occurred on the dates assumed.

10. LITIGATION AND LEGAL MATTERS

The Company is involved in litigation and administrative
proceedings primarily arising in the normal course of its
business. In the opinion of management, the Company's recovery,
if any, or the Company's liability, if any, under any pending
litigation or administrative proceeding would not materially
affect its financial condition or operations.

F-25
<PAGE>
11. QUARTERLY RESULTS OF OPERATIONS (unaudited)

1994
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
(expressed in thousands except share information)

Net sales $ 190,926 $ 212,342 $ 246,171 $ 259,081
Cost of sales 141,695 153,809 183,468 197,543
__________ __________ __________ __________
Gross profit 49,231 58,533 62,703 61,538
Operating expenses 38,473 48,344 51,147 51,842
__________ __________ __________ __________
Income from operations 10,758 10,189 11,556 9,696
Other income, net 169 283 383 160
__________ __________ __________ __________
Income before income taxes 10,927 10,472 11,939 9,856
Income tax expense 4,287 4,023 4,524 3,895
__________ __________ __________ __________
Net income $ 6,640 $ 6,449 $ 7,415 $ 5,961
Pro forma earnings per common
share(1) $ .11 $ .11 $ .12 $ .10

1995
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr.
(expressed in thousands except share information)

Net sales $ 303,287 $ 305,718 $ 332,037 $ 374,911
Cost of sales 231,466 230,070 244,237 274,791
__________ __________ __________ __________
Gross profit 71,821 75,648 87,800 100,120
Operating expenses 59,512 62,933 67,435 76,042
__________ __________ __________ __________
Income from operations 12,309 12,715 20,365 24,078
Other income, net 243 630 710 320
__________ __________ __________ __________
Income before income taxes 12,552 13,345 21,075 24,398
Income tax expense 4,833 5,137 8,584 9,637
__________ __________ __________ __________
Net income $ 7,719 $ 8,208 $ 12,491 $ 14,761
Pro forma earnings per common
share(1) $ .13 $ .13 $ .20 $ .24
Common stock prices(2)
High $ - $ 13 5/16 $ 14 7/8 $ 21 3/8
Low $ - $ 11 $ 11 3/16 $ 13 3/8

(1) Assumes that the shares issued in the initial public offerings
and the shares issued to BCC were issued at the beginning of
each year presented (see Note 2).

(2) The Company's common stock is traded principally on the New York
Stock Exchange.

12. SUBSEQUENT EVENT

The Company effected a two-for-one split of the Company's common stock
in the form of a 100% stock dividend distributed on May 20, 1996, to
shareholders of record at the close of business on May 6, 1996. All
references in these financial statements to numbers of shares of common
stock of the Company and to per share amounts, common stock prices and
all presentations of the Company's capital accounts have been adjusted
to reflect the stock split.

F-26

<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(An S Corporation)

Financial Statements for the
Years Ended December 31, 1994 and 1993 and
Independent Auditors' Report

F-27
<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders of
Word Technology Systems, Inc.:

We have audited the accompanying balance sheets of Word Technology Systems,
Inc. (an S Corporation) as of December 31, 1994 and 1993, and related
statements of income and retained earnings and of cash flows for the years
then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of Word Technology Systems, Inc. as of
December 31, 1994 and 1993, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted
accounting principles.

Deloitte & Touche LLP
February 10, 1995

F-28
<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(An S Corporation)

BALANCE SHEETS
DECEMBER 31, 1994 AND 1993
______________________________________________________________________________

ASSETS 1994 1993

CURRENT ASSETS:
Cash $ 1,100 $ 2,308
Accounts receivable -trade (less allowance
for doubtful accounts of $4,900 at
December 31, 1994 and 1993) (Note 3) 10,489,149 6,767,116
Accounts receivable - other 168,100 209,261
Inventories (Note 3) 4,706,949 4,234,817
Prepaid expenses 31,599 166,645
___________ ___________

Total current assets 15,396,897 11,380,147

PROPERTY AND EQUIPMENT - Net (Note 2) 1,859,425 1,781,880

OTHER ASSET - Cash surrender value of life
insurance (Note 3) 484,782 344,852
___________ ___________

TOTAL $17,741,104 $13,506,879

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
Note payable to bank (Note 3) $ 8,006,000 $ 5,386,000
Accounts payable (Note 4) 4,709,052 3,425,731
Accrued benefit plan contributions (Note 5) 40,000 45,000
Accrued commissions 68,840 57,416
Other accrued expenses 291,575 212,686
Current portion of long-term debt (Note 3) 110,210 95,998
___________ ___________

Total current liabilities 13,225,677 9,222,831
___________ ___________

LONG-TERM DEBT (Note 3) 753,668 863,879
___________ ___________

SHAREHOLDERS' EQUITY (Note 7):
Common stock, no par value - authorized,
30,000 shares; issued and outstanding,
80 shares 11,125 11,125
Retained earnings 3,750,634 3,409,044
___________ ___________

Total shareholders' equity 3,761,759 3,420,169
___________ ___________

TOTAL $17,741,104 $13,506,879

See notes to financial statements.

F-29

<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(An S Corporation)

STATEMENTS OF INCOME AND RETAINED EARNINGS
YEARS ENDED DECEMBER 31, 1994 AND 1993
______________________________________________________________________________

1994 1993

NET SALES $64,770,978 $55,679,838

COST OF SALES 56,034,044 47,378,655
___________ ___________

Gross profit 8,736,934 8,301,183

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 7,268,076 6,722,356
___________ ___________

INCOME FROM OPERATIONS 1,468,858 1,578,827

OTHER EXPENSES - Net (Note 3) 555,268 349,985
___________ ___________

NET INCOME 913,590 1,228,842

RETAINED EARNINGS, BEGINNING OF YEAR 3,409,044 2,569,802

SHAREHOLDER DISTRIBUTIONS (572,000) (389,600)
___________ ___________

RETAINED EARNINGS, END OF YEAR $ 3,750,634 $ 3,409,044

See notes to financial statements.

F-30
<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(An S Corporation)

STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1994 AND 1993
______________________________________________________________________________

1994 1993

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 913,590 $1,228,842
Adjustments to reconcile net earnings to net
cash provided by (used in) operating
activities:
Depreciation 180,306 160,613
Net changes in assets and liabilities:
Account receivable - trade (3,722,033) 454,489
Accounts receivable - other 41,161 (19,945)
Inventories (472,132) (1,025,016)
Prepaid expenses 135,046 (118,961)
Other asset 40,070 (30,216)
Accounts payable 1,283,321 (199,194)
Accrued benefit plan contribution (5,000)
Accrued commissions 11,424 (10,608)
Other accrued expenses 78,889 (132,382)
__________ __________
Net cash provided by (used in)
operating activities (1,515,358) 307,622
__________ __________

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (257,851) (119,488)
Payments for officers' life insurance (180,000) (155,000)
__________ __________
Net cash used in investing activities (437,851) (274,488)
__________ __________

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under line of credit and other
short-term debt, net of repayments 2,620,000 444,000
Shareholder distributions (572,000) (389,600)
Repayments of long-term debt (95,999) (87,002)
__________ __________
Net cash provided by (used in)
financing activities 1,952,001 (32,602)
__________ __________

INCREASE (DECREASE) IN CASH (1,208) 532

CASH, BEGINNING OF YEAR 2,308 1,776
__________ __________

CASH, END OF YEAR $ 1,100 $ 2,308

SUPPLEMENTAL DISCLOSURE OF CASH PAID FOR INTEREST $ 546,037 $ 412,843

See notes to financial statements.

F-31
<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(AN S CORPORATION)

NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1994 AND 1993
___________________________________________________________________________

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Inventories - Inventories are stated at the lower of cost (first-in,
first-out method) or market.

Property and Equipment - Property and equipment is stated at cost less
accumulated depreciation. Depreciation is provided under the
straight-line and accelerated methods over estimated useful lives of 5
to 31.5 years.

Income Taxes - The Company has elected to operate as an S Corporation
for federal and state income tax purposes. As such, all income taxes
are the personal responsibility of the individual shareholders, and no
provision for federal or state income taxes has been recorded in the
financial statements of the Company.

2. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

1994 1993

Land $ 587,000 $ 587,000
Building 1,052,810 1,052,810
Furniture 293,254 203,458
Equipment 535,049 433,484
Vehicles 76,576 76,576
__________ __________

Total 2,544,689 2,353,328
Less accumulated depreciation 685,264 571,448
__________ __________

Property and equipment - net $1,859,425 $1,781,880

3. DEBT

The Company has a bank line of credit for short-term borrowings up to
$10,000,000, with interest payable monthly at prime plus 1/2% (9.0% at
December 31, 1994); $1,994,000 of the line was unused at December 31,
1994. All accounts receivable, inventories and $500,000 in officers'
life insurance are pledged as collateral on the line of credit. In
addition, the shareholders have provided personal guarantees on these
borrowings. Under its agreement with the bank, the Company will
comply with certain financial covenants concerning a minimum debt-to-
equity ratio and a required amount of net worth. The line of credit
expires June 1995; however, management expects to be able to renew the
credit facility under similar terms.

F-32
<PAGE>

The Company has a mortgage note payable to a bank with a balance of
$863,878 and $959,877 at December 31, 1994 and 1993, respectively,
collateralized by its St. Louis office/warehouse facility. Interest
on the note is at 9.75%; principal payments for the succeeding five
years are as follows:

1995 $110,210
1996 117,320
1997 129,451
1998 506,897

Interest expense of $546,037 and $412,843 for the years ended
December 31, 1994 and 1993, respectively, are included in other
expenses.

4. ACCOUNTS PAYABLE

Accounts payable includes bank overdrafts of $580,853 and $905,306 at
December 31, 1994 and 1993, respectively.

5. DEFINED CONTRIBUTION PLAN

Effective January 1, 1993, the Board of Directors of the Company
amended the Company's former profit sharing plan to make it a 401(k)
plan. The plan, as amended, covers all employees who have attained
specified age and years of service requirements. The Company's
contribution to the plan is determined annually by the Board of
Directors and is limited to a percentage of employee eligible earnings
for the year. The Company contribution to the plan for the years
ended December 31, 1994 and 1993 was $40,000 and $45,000,
respectively.

6. LEASES

The Company leases office and warehouse facilities under operating
lease agreements with varying terms. Future minimum lease commitments
at December 31, 1994 under all noncancellable leases are as follows:

1995 $107,116
1996 100,553
1997 76,389
1998 24,941

Rent expense for the years ended December 31, 1994 and 1993 was
$116,388 and $84,287, respectively.

7. STOCK REPURCHASE AGREEMENT

The Company's two 50% shareholders have an agreement whereby, upon the
death of a shareholder, either the Company or the remaining
shareholder is obligated to repurchase the shares of the deceased
shareholder at an amount defined in the agreement.

* * * * * *

F-33
<PAGE>
WORD TECHNOLOGY SYSTEMS, INC.
(An S Corporation)

Financial Statements for the
Nine Months Ended September 29, 1995 and September 30, 1994
(unaudited)

F-34
<PAGE>
WORD TECHNOLOGY SYSTEMS INC.
(An S Corporation)

BALANCE SHEET
SEPTEMBER 29, 1995

September 29, 1995
(unaudited)
__________________

ASSETS

CURRENT ASSETS:
Cash $ 1,100
Accounts Receivable - Trade (less allowance for
doubtful accounts of $75,000) 10,052,747
Accounts Receivable - Other 681,670
Inventories 5,325,174
Prepaid Expenses 71,336
___________

TOTAL CURRENT ASSETS 16,132,027

PROPERTY AND EQUIPMENT, NET 1,765,558

OTHER ASSETS
Deposits 8,841
Officer's Life Insurance 709,658
___________

TOTAL OTHER ASSETS 718,499

TOTAL ASSETS $18,616,084

LIABILITIES AND SHAREHOLDER'S EQUITY

CURRENT LIABILITIES
Note Payable - Bank $ 8,097,196
Accounts Payable 6,019,499
Accrued Commissions 94,527
Accrued Benefit Plan Contributions 24,017
Accrued Expenses - Other 298,011
Current Portion of Long Term Debt 0
___________

TOTAL CURRENT LIABILITIES 14,533,250

LONG TERM DEBT 783,331

STOCKHOLDER'S EQUITY
Common Stock 11,125
Retained Earnings 3,288,378
___________

TOTAL STOCKHOLDER'S EQUITY 3,299,503
___________

TOTAL LIABILITIES & EQUITY $18,616,084

F-35
<PAGE>
WORD TECHNOLOGY SYSTEMS INC.
(An S Corporation)

STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE NINE MONTHS ENDED SEPTEMBER 29, 1995 AND SEPTEMBER 30, 1994

1995 1994
(unaudited) (unaudited)
___________ ___________

NET SALES $56,398,200 $46,169,028

COST OF SALES 50,314,313 40,180,810
___________ ___________

Gross Profit 6,083,887 5,988,218

SELLING, GENERAL, AND ADMINISTRATIVE
EXPENSES 5,427,369 4,823,777
___________ ___________

INCOME FROM OPERATIONS 656,518 1,164,441

OTHER EXPENSES (INCOME) 552,215 348,863
___________ ___________

NET INCOME 104,303 815,578
___________ ___________

RETAINED EARNINGS, BEGINNING OF YEAR 3,750,635 3,420,169

SHAREHOLDER DISTRIBUTIONS (566,560) (572,000)
___________ ___________

RETAINED EARNINGS, END OF PERIOD $ 3,288,378 $ 3,663,747

F-36
<PAGE>
WORD TECHNOLOGY SYSTEMS INC.
(AN S CORPORATION)

STATEMENT OF CASH FLOW
FOR THE NINE MONTHS ENDED SEPTEMBER 29, 1995 AND SEPTEMBER 30, 1994

1995 1994
(unaudited) (unaudited)
___________ ___________

CASH FLOWS FROM OPERATING ACTIVITIES:

Net Income $ 104,303 $ 815,578

Adjustments to reconcile net earnings to
net cash provided by (used in) operating
activities:
Depreciation 148,241 122,547
Net Book Value of Asset Sales/Retirements 115,176 0
Net Changes in Assets and Liabilities:
Accounts Receivable - Trade 76,105 (2,685,191)
Accounts Receivable - Other (153,183) (184,608)
Inventory (618,225) 1,302,129
Prepaid Expenses (39,737) 8,802
Other Assets (98,717) (3,053)
Accounts Payable (Including Cash
Overdraft) 1,310,447 782,759
Accrued Benefit Plan Contribution (15,983) (35,000)
Accrued Commissions 25,687 21,618
Other Accrued Expenses 6,347 117,818
___________ ___________
Net Cash Provided by (Used in)
Operating Activities 860,461 263,399
___________ ___________

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital Expenditures (169,550) (211,389)
Payments for Officers' Life Insurance (135,000) (135,000)
___________ ___________
Net Cash Used in Investing Activities (304,550) (346,389)
___________ ___________

CASH FLOWS FROM FINANCING ACTIVITIES:

Net Borrowings (Repayments) - Line of Credit 91,196 728,389
Shareholder Distributions (566,560) (572,000)
Repayments of Long-Term Debt (80,547) (72,999)
___________ ___________
Net Cash Provided by (Used in)
Financing Activities (555,911) 83,390
___________ ___________

INCREASE (DECREASE) IN CASH 0 400

CASH, BEGINNING OF PERIOD 1,100 700
___________ ___________
CASH, END OF PERIOD $ 1,100 $ 1,100

F-37
<PAGE>
WORD TECHNOLOGY SYSTEMS INC.
(An S Corporation)

NOTES TO FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 29, 1995 AND SEPTEMBER 30, 1994
___________________________________________________________________________

1. BASIS OF PRESENTATION

The accompanying interim financial statements have been prepared by
the Company. These statements should be read together with the
statements and the accompanying notes included in the Company's
audited financial statements for the Year Ended December 31, 1994.
The interim financial statements have not been audited by independent
public accountants, but in the opinion of management; all adjustments
necessary to present fairly the results for the periods have been
included. Except as may be disclosed within these notes, the
adjustments made were of a normal, recurring nature. Interim results
are not necessarily indicative of results that may be expected for
the year.

On September 29, 1995, the net assets of the company were purchased
by Boise Cascade Office Products Corporation. These interim
financial statements include the financial position and results of
operations of the Company prior to its purchase by Boise Cascade
Office Products Corporation.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Inventories - Inventories are stated at the lower of cost (first-in,
first-out method) or market.

Property and Equipment - Property and equipment is stated at cost
less accumulated depreciation. Depreciation is provided under the
straight-line an accelerated methods over estimated useful lives of 5
to 31.5 years.

Income Taxes - The Company has elected to operate as an S Corporation
for federal and state income tax purposes. As such, all income taxes
are the personal responsibility of the individual shareholders, and
no provision for federal or state income taxes has been recorded in
the financial statements of the Company.

3. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

September 29, 1995
__________________

Land $ 587,776
Building 1,052,810
Furniture 290,432
Equipment 594,549
__________

Total 2,525,567
Less accumulated depreciation 760,009
__________

Property and equipment - net $1,765,558

F-38
<PAGE>
4. DEBT

The Company has a bank line of credit for short-term borrowings up to
$10,000,000, with interest payable monthly at prime plus 1/2% (9.0%
at September 29, 1995); $2,082,000 of the line was unused at
September 29, 1995. All accounts receivable, inventories and
$500,000 in officers' life insurance are pledged as collateral on the
line of credit. In addition, the shareholders have provided personal
guarantees on these borrowings. Under its agreement with the bank,
the Company will comply with certain financial covenants concerning a
minimum debt-to-equity ratio and a required amount of net worth. The
line of credit expires June 1996; however, management expects to be
able to renew the credit facility under similar terms.

The Company has a mortgage note payable to a bank with a balance of
$783,331 at September 29, 1995, collateralized by its St. Louis
office/warehouse facility. Interest on the note is at 9.75%;
principal payments for the succeeding five years are as follows:

1995 (three months remaining) $ 29,663
1996 117,320
1997 129,451
1998 506,897

Interest expense of $551,737 for the nine month period ended
September 29, 1995 and $371,795 for the nine month period ended
September 30, 1994 is included in other expenses.

5. ACCOUNTS PAYABLE

Accounts payable includes bank overdrafts of $506,090 at
September 29, 1995.

6. DEFINED CONTRIBUTION PLAN

Effective January 1, 1993, the Board of Directors of the Company
amended the Company's former profit sharing plan to make it a 401(k)
plan. The plan, as amended, covers all employees who have attained
specified age and years of service requirements. The Company's
contribution to the plan is determined annually by the Board of
Directors and is limited to a percentage of employee eligible
earnings for the year. For the nine months ended September 29, 1995,
$24,017 was accrued for the 1995 contribution and for the nine months
ended September 30, 1994, $10,000 was accrued for the 1994
contribution.

7. LEASES

The Company leases office and warehouse facilities under operating
lease agreements with varying terms. Future minimum lease
commitments at September 29, 1995, under all noncancellable leases
are as follows:

1995 (three months remaining) $ 33,370
1996 103,477
1997 74,026
1998 24,490

F-39
<PAGE>
Rent expense for the nine months ended September 29, 1995, was
$103,575 and was $81,657 for the nine months ended September 30,
1994.

8. STOCK REPURCHASE AGREEMENT

The Company's two 50% shareholders have an agreement whereby, upon
the death of a shareholder, either the Company or the remaining
shareholder is obligated to repurchase the shares of the deceased
shareholder at an amount defined in the agreement.

F-40
<PAGE>
NEAT IDEAS LIMITED

REPORT OF THE DIRECTOR

The director presents his report together with the accounts of the
company for the year ended 31st December, 1995.

PRINCIPAL ACTIVITY

The principal activity of the company, during the year under review,
was the sale of stationery and office equipment by mail order.

REVIEW OF BUSINESS AND FUTURE DEVELOPMENTS

A summary of the results of the year's trading is given on page 4 of
the accounts.

The company is registered as a Quality Assured Stockist of office
products with the British Standards Institute, to BS5750 Part 2, Level B
ISO 9002, Registration No. RS 10486, assessment being carried out twice
yearly.

As referred to in note 11 to the accounts, on 29th December 1995,
Reliable UK Limited acquired the entire issued share capital of the
company. The director is confident that, with the support of the company's
new parent company, 1996 will see continued growth.

The director does not recommend any dividend (1994 - Nil).

DIRECTORS

The directors in office in the year were:

H. F. Peer (resigned 29th December 1995)
J. Holleran (appointed 29th December 1995)

The director who held office at the end of the financial year did not
have any disclosable interest in the shares of the company.

DIRECTOR'S RESPONSIBILITIES

Company Law requires the director to prepare accounts for each
financial year which give a true and fair view of the state of affairs of
the company and of the profit or loss of the company for that period. In
preparing those accounts, the director is required to:

* select suitable accounting policies and then apply them consistently;
* make judgements and estimates that are reasonable and prudent;
* follow applicable accounting standards, subject to any material
departures disclosed and explained in the accounts;
* prepare the accounts on the going concern basis unless it is
inappropriate to presume that the company will continue in business.

The director is responsible for keeping proper accounting records
which disclose with reasonable accuracy at any time the financial position

F-41
<PAGE>
of the company and to enable him to ensure that the accounts comply with
the Companies Act 1985. He is also responsible for safeguarding the assets
of the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.

FIXED ASSETS

Acquisitions and disposals of fixed assets during the year are
recorded in the notes to the accounts.

HEALTH AND SAFETY AT WORK

The company is a member of the British Safety Council, holding a
'5-star' award for the management of its health and safety policies with
annual assessment under a '5-star' grading system.

AUDITORS

On 1st October 1995, the auditors changed the name under which they
practise from Buzzacott & Co. to Buzzacott, and have, accordingly, signed
their report in their new name.

Signed by the director

/s/ J. Holleran

Director

Date of approval: 3 April 1996

F-42
<PAGE>
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF

NEAT IDEAS LIMITED

We have audited the accounts on pages 4 to 13 which have been
prepared under the historical cost convention and the accounting policies
set out on pages 7 and 8.

RESPECTIVE RESPONSIBILITIES OF DIRECTOR AND AUDITORS

As described on page 1, the company's director is responsible for the
preparation of the accounts. It is our responsibility to form an
independent opinion, based on our audit, on those accounts and to report
our opinion to you.

BASIS OF OPINION

We conducted our audit in accordance with Auditing Standards issued
by the Auditing Practices Board. An audit includes examination, on a test
basis, of evidence relevant to the amounts and disclosures in the accounts.
It also includes an assessment of the significant estimates and judgements
made by the director in the preparation of the accounts, and of whether the
accounting policies are appropriate to the company's circumstances,
consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the
information and explanations which we considered necessary in order to
provide us with sufficient evidence to give reasonable assurance that the
accounts are free from material misstatement, whether caused by fraud or
other irregularity or error. In forming our opinion, we also evaluated the
overall adequacy of the presentation of information in the accounts.

OPINION

In our opinion, the accounts give a true and fair view of the state
of the company's affairs as at 31st December, 1995 and of its profit for
the year then ended and have been properly prepared in accordance with the
Companies Act 1985.

/s/ BUZZACOTT
_________________________________
BUZZACOTT,
Chartered Accountants and Registered Auditors
4 Wood Street
London, EC2V 7JB Date: 9th April 1996

F-43
<PAGE>
<TABLE>
NEAT IDEAS LIMITED

PROFIT AND LOSS ACCOUNT

FOR THE YEAR ENDED 31ST DECEMBER, 1995
(expressed in British Pounds)

<CAPTION>
Notes 1995 1994

<S> <C> <C> <C> <C> <C>
TURNOVER 22,322,125 18,743,729

CHANGE IN STOCKS OF
FINISHED GOODS (149,189) 540,720
__________ __________
22,172,936 19,284,449
OTHER OPERATING INCOME 296,698 185,758
__________ __________
22,469,634 19,470,207
GOODS FOR RESALE 14,952,072 13,115,241
__________ __________
GROSS PROFIT 7,517,562 6,354,966

Staff costs:
Wages and salaries (3) 1,447,015 1,303,151
Social Security costs 103,795 94,710
Pension costs 51,348 45,877
__________ __________
1,602,158 1,443,738

Depreciation written-off
tangible fixed assets 226,759 285,556
Other operating charges 4,442,496 3,998,727
__________ __________
6,271,413 5,728,021
__________ __________
OPERATING PROFIT (4) 1,246,149 626,945

Interest receivable 5,958 5,952
Interest payable (6) 62,485 42,694
__________ __________
56,527 36,742
__________ __________
PROFIT before taxation 1,189,622 590,203

Taxation (7) 225,000 -
__________ __________
RETAINED PROFIT for the year 964,622 590,203

ACCUMULATED LOSS as at
1st January, 1995 (790,504) (1,380,707)
__________ __________

ACCUMULATED PROFIT/(LOSS)
as at 31st December, 1995 174,118 (790,504)
__________ __________
CONTINUING OPERATIONS

</TABLE>
None of the company's activities were acquired or discontinued during
the above two financial years.

RECOGNISED GAINS AND LOSSES

There were no recognised gains or losses other than those shown in the
profit and loss account.

The notes form part of these accounts.

F-44
<PAGE>
<TABLE>
NEAT IDEAS LIMITED

BALANCE SHEET -- 31ST DECEMBER, 1995
(expressed in British Pounds)

<CAPTION>
Notes 1995 1994

<S> <C> <C> <C> <C> <C>
FIXED ASSETS
Tangible Assets (8) 1,541,932 1,495,443

CURRENT ASSETS
Stocks 1,878,765 2,027,953
Debtors (9) 3,362,390 2,426,740
Cash at bank and in hand 300 300
__________ __________
5,241,455 4,454,993

CREDITORS: Amounts falling
due within one year (10) 3,109,269 3,240,940
__________ __________
2,132,186 1,214,053
__________ __________
TOTAL ASSETS LESS
CURRENT LIABILITIES 3,674,118 2,709,496
__________ __________

CAPITAL AND RESERVES
Called-up share capital (12) 3,500,000 3,500,000
Profit and loss account 174,118 (790,504)
__________ __________

SHAREHOLDERS' FUNDS --
equity interests (13) 3,674,118 2,709,496
__________ __________
</TABLE>

Signed by the director:

/s/ J. Holleran
____________________________________
Director

Date of approval: 3 April 1996

The notes form part of these accounts.

F-45
<PAGE>
<TABLE>
NEAT IDEAS LIMITED

CASH FLOW STATEMENT

FOR THE YEAR ENDED 31ST DECEMBER, 1995
(expressed in British Pounds)

<CAPTION>
Notes 1995 1994

<S> <C> <C> <C> <C> <C>
NET CASH INFLOW FROM
OPERATING ACTIVITIES 16(a) 806,477 129,427

NET CASH (OUTFLOW)
FROM RETURN ON INVESTMENTS
AND SERVICING OF FINANCE:

Interest received 5,958 5,952
Interest paid (62,727) (42,519)
__________ __________
(56,769) (36,567)

NET CASH (OUTFLOW)
FROM INVESTING ACTIVITIES:

Payment to acquire
tangible fixed assets (273,248) (110,853)
Proceeds on disposal of
tangible fixed assets 0 6,085
__________ __________
(273,248) (104,768)
__________ __________

NET CASH INFLOW/(OUTFLOW)
BEFORE FINANCING 476,460 (11,908)

NET CASH OUTFLOW
FROM FINANCING 16(b)

Loan repaid (700,000) 0
__________ __________
(700,000) 0
__________ __________

(DECREASE) IN CASH AND
CASH EQUIVALENTS 16(d) (223,540) (11,908)
__________ __________
</TABLE>

The notes form part of these accounts.

F-46
<PAGE>
NEAT IDEAS LIMITED

NOTES TO THE ACCOUNTS -- 31ST DECEMBER, 1995

1. PRINCIPAL ACCOUNTING POLICIES

(a) Basis of accounting

The accounts have been prepared under the historical cost
convention and in accordance with applicable Accounting Standards.

(b) Turnover

Turnover consists of sales of goods at invoiced value,
excluding value added tax. Invoiced value includes carriage. Goods
are sold with a reservation of title until such time as payment is
made. Under the conditions of sale, the company guarantees to
replace equipment within the period of one year.

Depreciation is provided on cost at the following annual rates
in order to write off each asset over its expected useful life:

Long leasehold 3.03%
Long leasehold improvements 6.67%
Computer equipment 20.00% - 25.00%
Fixtures and fittings:
Warehouse equipment 20.00%
Office equipment and telephones 25.00%
Motor vehicles 25.00%

Depreciation is provided from the month of purchase.

(d) Leased assets

Rentals applicable to operating leases, where substantially all
the benefits and risks of ownership remain with the lessor, are
charged to the profit and loss account as incurred.

(e) Stocks

Stocks, which comprise finished goods, are valued at the lower
of cost and net realisable value. Cost is computed at the invoiced
price of goods held at the year end. Net realisable value has been
used for slow moving stocks, stocks which have physically
deteriorated and those which are no longer contained in the company's
catalogues.

(f) Trade catalogues

Expenditure relating to the purchase and distribution of trade
catalogues is written off in the period in which it is estimated that
the benefit will be received.

F-47

<PAGE>
(g) Pension costs

Contributions in respect of the company's discretionary money
purchase scheme are charged to the profit and loss account of the
period in which they are payable to the scheme.

2. TURNOVER

The turnover and profit before taxation are attributable to the
one principal activity of the company and arise solely within the
United Kingdom.

3. STAFF COSTS

The average weekly number of employees during the period was as
follows:

1995 1994

Office management 77 66
Distribution 37 38
________ ________
114 104
________ ________
4. OPERATING PROFIT

This is stated after charging:

1995 1994
(expressed in British Pounds)

Rental costs relating to operating
leases 18,617 31,183
Auditors' remuneration -- audit fees 16,550 18,300
-- other services 21,512 4,900
________ ________

5. DIRECTORS' REMUNERATION

The directors did not receive any remuneration for their services
as directors during the year.

6. INTEREST PAYABLE

1995 1994
(expressed in British Pounds)

On bank overdraft 32,064 15,485
On short-term loan 30,421 27,209
________ ________
62,485 42,694
________ ________

F-48
<PAGE>

7. TAXATION

1995 1994
(expressed in British Pounds)

UK Corporation tax at 33% on profit
for the year 225,000 -
________ ________

The utilisation of brought forward trading losses has reduced
the tax charge for the year by approximately 180,000.

8. TANGIBLE FIXED ASSETS

<TABLE>
<CAPTION>
Long Computer Fixtures & Motor
Leasehold Equipment Fittings Vehicles Total
(expressed in British Pounds)

Cost
<S> <C> <C> <C> <C> <C>
At 1st January, 1995 1,443,389 555,300 800,779 39,728 2,839,196
Additions 97,680 117,042 58,526 0 273,248
Disposals 0 (65,022) (65,145) 0 (130,167)
_________ _________ _________ _________ _________

At 31st December, 1995 1,541,069 607,320 794,160 39,728 2,982,277
_________ _________ _________ _________ _________

Depreciation
At 1st January, 1995 233,011 419,248 681,561 9,933 1,343,753
Charge for the year 46,452 90,778 78,997 9,932 226,159
Disposals 0 (64,422) (65,145) 0 (129,567)
_________ _________ _________ _________ _________

At 31st December, 1995 279,463 445,604 695,413 19,865 1,440,345
_________ _________ _________ _________ _________

Written down values

At 31st December, 1995 1,261,606 161,716 98,747 19,863 1,541,932
_________ _________ _________ _________ _________

At 31st December, 1994 1,210,378 136,052 119,218 29,795 1,495,443
_________ _________ _________ _________ _________

</TABLE>
At 31st December, 1995, capital commitments were as follows:

1995 1994
(expressed in British Pounds)

Authorised by the directors, but not
contracted for 0 85,000
________ _______

F-49

<PAGE>
9. DEBTORS

1995 1994
(expressed in British Pounds)

Trade debtors 3,038,471 2,258,167
Other debtors 286,260 91,285
Trade catalogue costs prepaid 11,887 42,995
Other prepayments 25,772 34,293
_________ _________
3,362,390 2,426,740
_________ _________

10. CREDITORS

1995 1994
(expressed in British Pounds)

Bank overdraft 275,657 52,117
Trade creditors 1,794,223 1,892,961
Loan 0 703,742
Social Security and other taxes 236,128 173,452
Taxation 223,970 0
Other creditors 60,442 35,857
Accruals 518,849 382,811
_________ _________

3,109,269 3,240,940
_________ _________

11. PARENT COMPANY

The company was a wholly owned subsidiary of Kaiser + Kraft GmbH,
a company incorporated in the Federal Republic of Germany until 29th
December 1995, when the entire issued share capital was acquired by
Reliable UK Limited.

At the balance sheet date, the company is a wholly owned
subsidiary of Reliable UK Limited, which is incorporated in the United
Kingdom. The ultimate parent company is Boise Cascade Corporation,
which is incorporated in the United States of America.

12. CALLED UP SHARE CAPITAL

1995 1994
(expressed in British Pounds)

Authorised
4,000,000 ordinary shares of 1 each 4,000,000 4,000,000
_________ _________

Allotted, called up and fully-paid
3,500,000 ordinary shares of 1 each 3,500,000 3,500,000
_________ _________

F-50

<PAGE>
13. RECONCILIATION OF MOVEMENTS ON SHAREHOLDERS' FUNDS

1995 1994
(expressed in British Pounds)

Profit for the financial year after taxation 964,622 590,203
Opening shareholders' funds at
1st January, 1995 2,709,496 2,119,293
_________ _________

Closing shareholders' funds at
31st December, 1995 3,674,118 2,709,496
_________ _________

14. LEASING COMMITMENTS

The company has annual commitments under operating leases for
fixtures and fittings and motor vehicles, as set out below:

1995 1994
(expressed in British Pounds)

Leases which expire:
Within one year 0 18,617
Within two to five years 0 0
_________ _________

0 18,617
_________ _________

15. CONTINGENT LIABILITY

In December 1992 the company assigned a lease with
approximately 15 years still to run. In the event that the assignee
or any subsequent assignee should default in payment of the rent, the
lessor can exercise a right of redress against the company. The
contingent liability is estimated to be approximately 39,500 (in
British Pounds) per annum.

16. NOTES TO CASH FLOW STATEMENT

(a) Reconciliation of operating profit to net
cash inflow from operating activities

1995 1994
(expressed in British Pounds)

Operating profit 1,246,149 626,945
Depreciation charges (including loss
on disposal) 226,759 285,556
Decrease/(Increase) in stocks 149,189 (540,720)
(Increase) in debtors (935,650) (262,710)
Increase in creditors 120,031 20,356
_________ _________
806,477 129,427
_________ _________
F-51

<PAGE>
(b) Analysis of changes in financing during the year

1995 1994
(expressed in British Pounds)

Loan

Balance at 1st January, 1995 700,000 700,000
Cash outflow from financing in the year (700,000) 0
_________ _________

Balance at 31st December, 1995 0 700,000
_________ _________

1995 1994
(expressed in British Pounds)

Balance at 1st January, 1995 (51,817) (39,909)
Net cash (outflow) in year (223,540) (11,908)
_________ _________

Balance at 31st December, 1995 (275,357) (51,817)
_________ _________

(d) Analysis of balances of cash and cash equivalent as shown in the Balance
Sheet.

Change Change
1995 1994 1993 in 1995 in 1994
(expressed in British Pounds)

Cash at bank
and in hand 300 300 800 0 (500)
Bank overdraft (275,657) (52,117) (40,709) (223,540) (11,408)
_________ _________ _________ _________ _________

(275,357) (51,817) (39,909) (223,540) (11,908)
_________ _________ _________ _________ _________

F-52
<PAGE>
Grand & Toy Limited

Financial Statements

For the year ended April 2, 1995

F-53

<PAGE>
AUDITORS' REPORT

TO THE SHAREHOLDER OF GRAND & TOY LIMITED

We have audited the balance sheet of Grand & Toy Limited as at April 2, 1995
and the statements of earnings, retained earnings and cash flow for the year
then ended. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform an audit to
obtain reasonable assurance whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.

In our opinion, these financial statements present fairly, in all material
respects, the financial position of the company as at April 2, 1995 and the
results of its operations and cash flow for the year then ended in accordance
with Canadian generally accepted accounting principles.

Prior year balances are unaudited.

COOPERS & LYBRAND

Chartered accountants

North York, Ontario
December 5, 1995

F-54
<PAGE>
Grand & Toy Limited
Balance Sheet as at April 2, 1995
(Expressed in Canadian dollars)

April 2, April 3,
1995 1994
(Unaudited)
Assets
Current Assets
Cash and short-term deposit $ 251,367 $ 80,855
Accounts receivable 39,991,304 32,623,353
Income taxes recoverable - 41,621
Inventories 27,500,179 25,886,899
Prepaid expenses and deposits 3,117,456 2,774,599
____________ ____________
70,860,306 61,407,327
Long-Term Receivables (note 2) 1,509,292 893,330
Capital Assets (note 3) 24,090,713 25,746,709
Deferred Income Taxes 2,170,074 43,000
Goodwill 555,159 795,724
____________ ____________

$ 99,185,544 $ 88,886,090

Liabilities
Current Liabilities
Bank indebtedness $ 7,639,924 $ 2,507,039
Accounts payable and accrued liabilities 34,383,200 28,374,137
Income taxes payable 65,775 -
Amounts due to parent company (note 7) 26,732,899 42,304,353
____________ ____________
68,821,798 73,185,529
Long-Term Debt (note 4) 25,500,000 10,500,000
____________ ____________
94,321,798 83,685,529
____________ ____________
Shareholder's Equity
Capital Stock
Authorized -
12,000 Common shares
13,649 non-cumulative, preferred shares,
redeemable at $9.75 per share
Issued -
10,504 Common shares 610,188 610,188
Retained Earnings 4,253,558 4,590,373
____________ ____________

4,863,746 5,200,561
____________ ____________

$ 99,185,544 $ 88,886,090

APPROVED ON BEHALF OF THE BOARD

________________________________
Director

F-55
<PAGE>
Grand & Toy Limited
Statement of Retained Earnings
For the year ended April 2, 1995
(Expressed in Canadian dollars)

April 2, April 3,
1995 1994
(Unaudited)

Balance - Beginning of Year $ 4,590,373 $ 2,554,785

Net (loss) earnings for the year (336,815) 2,035,588
____________ ____________

Balance - End of Year $ 4,253,558 $ 4,590,373

F-56
<PAGE>
Grand & Toy Limited
Statement of Earnings
For the year ended April 2, 1995
(Expressed in Canadian dollars)

April 2, April 3,
1995 1994
(Unaudited)

Gross Revenue $281,577,016 $266,744,789
____________ ____________

Expenses
Administrative and other expenses (note 5) 275,302,210 257,443,350
Interest income (134,313) (67,850)
Interest on long-term debt and other
financial expenses (note 7) 4,000,742 2,027,614
Amortization of capital assets 4,128,960 3,507,405
Amortization of goodwill 240,565 166,545
____________ ____________

283,538,164 263,077,064
____________ ____________

(Loss) Earnings Before Income Taxes (1,961,148) 3,667,725
____________ ____________

(Recovery of) Provision for Income Taxes
Current 349,741 1,785,137
Deferred (1,974,074) (153,000)
____________ ____________

(1,624,333) 1,632,137
____________ ____________

Net (Loss) Earnings for the Year $ (336,815) $ 2,035,588

F-57
<PAGE>
Grand & Toy Limited
Statement of Cash Flow
For the year ended April 2, 1995
(Expressed in Canadian dollars)

April 2, April 3,
1995 1994
(Unaudited)

Cash Provided By (Used In):

Operating Activities

Net (loss) earnings for the year $ (336,815) $ 2,035,588
Items not affecting cash -
Amortization of capital assets 4,128,960 3,507,405
Amortization of goodwill 240,565 166,545
Loss on disposal of capital assets 407,057 99,259
Deferred income taxes (1,974,074) (153,000)
____________ ____________

2,465,693 5,655,797

Change in non-cash operating working capital (18,932,083) 15,285,752
____________ ____________

(16,466,390) 20,941,549
____________ ____________

Investing Activities

Purchase of capital assets (2,948,771) (5,441,142)
Proceeds on disposal of capital assets 68,750 82,625
Goodwill - (962,269)
____________ ____________

(2,880,021) (6,320,786)
____________ ____________

Financing Activities

Increase in long-term receivables (615,962) (893,330)
Increase (decrease) in long-term debt 15,000,000 (11,000,000)
____________ ____________

14,384,038 (11,893,330)
____________ ____________

Change in Cash for the Year (4,962,373) 2,727,433

Net Bank Indebtedness - Beginning of Year (2,426,184) (5,153,617)
____________ ____________

Net Bank Indebtedness - End of Year $ (7,388,557) $ (2,426,184)

Net Bank Indebtedness Comprises Of:

Cash and short-term deposit $ 251,367 $ 80,855
Bank indebtedness (7,639,924) (2,507,039)
____________ ____________

$ (7,388,557) $ (2,426,184)

F-58
<PAGE>
Grand & Toy Limited
Notes to Financial Statements
For the year ended April 2, 1995
(Expressed in Canadian dollars)

1. Accounting Policies

(a) Inventories are valued at the lower of cost and net realizable
value. Commercial inventory costs are determined using the
moving average cost method. The cost of inventories in retail
outlets is determined by formula application to the marked retail
value.

(b) Buildings are amortized on the declining balance method at 5%.
Equipment is amortized on the declining balance method at rates
ranging from 10% to 30%. Automobiles are amortized on the
declining balance method at 30%.

(c) Leasehold improvements are amortized on the straight-line method
over the term of the lease plus the first renewal, if
appropriate.

(d) Goodwill is amortized on a straight-line basis over 4 years.

(e) Income on the sale of franchises is deferred until such time as
all obligations related thereto are satisfied.

(f) The corporation's fiscal year end falls on the Sunday closet to
March 31st.

2. Long-term Receivables

April 2, April 3,
1995 1994
(Unaudited)

Notes receivable from owner/operators $ 2,061,492 $ 1,299,330
Less: Current portion included in
accounts receivable (552,200) (406,000)
____________ ____________

Long-term portion $ 1,509,292 $ 893,330

The notes receivable from owner/operators are repayable over 5 years, bear
interest at 9% per annum. Inventories held by the owner/operators have
been pledged as collateral.

F-59
<PAGE>
3. Capital Assets

April 2, April 3,
1995 1994
(Unaudited)
Accumulated
Cost amortization Net Net

Land $ 1,407,816 $ - $ 1,407,816 $ 1,407,816
Buildings 13,874,960 5,989,608 7,885,352 8,256,315
Automobiles 1,242,549 1,137,967 104,582 181,810
Equipment 29,099,768 20,321,653 8,778,115 10,197,128
Leasehold
improvements 13,343,757 7,428,909 5,914,848 5,703,640
___________ ___________ ___________ ___________
$58,968,850 $34,878,137 $24,090,713 $25,746,709

4. Long-Term Debt

April 2, April 3,
1995 1994
(Unaudited)

Unsecured banker's acceptances subject to
non-revolving bank lines of credit expiring
March 1998 and April 1996. During the year,
the average effective rate of interest
approximated 0.84% below the bank's prime rate
to their most preferred customers $25,500,000 $10,500,000

Repayments of principal planned and/or required over the next five years
are as follows:

Year ending 1996 $ 5,000,000
1997 6,000,000
1998 14,500,000
___________
$ 25,500,000

The 1998 amount is subject to further refinancing.

5. Administrative and Other Expenses

Included in administrative and other expenses are restructuring charges
amounting to $7,576,000 (1994 - Nil). This amount includes primarily
asset write-downs, lease buy-outs, employee severances and other related
expenses in respect to the company's closure of one warehouse, 12 retail
outlets and elimination of approximately 120 jobs.

F-60
<PAGE>
6. Operating Lease Commitments

Minimum rentals under head leases (excluding rentals based on sales)
and related recoveries from sub-leases to franchisees (principally to
a maximum of five years) in the normal course of business are
approximately:

Gross Sub-Leases Net

Year ending 1996 $10,823,280 $ 2,734,543 $ 8,088,737
1997 8,646,825 2,347,200 6,299,625
1998 6,808,718 1,550,061 5,258,657
1999 4,556,693 1,049,625 3,507,068
2000 2,278,475 440,506 1,837,969
Thereafter 1,593,938 327,522 1,266,416
___________ ___________ ___________
$34,707,929 $ 8,449,457 $26,258,472

7. Related Party Transactions

i) Sales of $687,000 (1994 - $490,000) on normal commercial terms
were made to related companies during the year.

ii) Amounts due to parent company have no fixed terms of repayment
and were primarily interest bearing. Interest rates varied
between 4.6% and 7.6% during the year.

iii) Interest charges from the parent company during the year
amounted to $1,438,186 (1994 - $611,976).

F-61

<PAGE>
Grand & Toy Limited

Financial Statements

For the 40 Weeks Ended January 7, 1996 and January 8, 1995

Unaudited

F-62

<PAGE>
Grand & Toy Limited
Balance Sheet as at January 7, 1996 and January 8, 1995
Unaudited (Expressed in Canadian Dollars)

January 7, January 8,
1996 1994
Assets

Current Assets
Cash $ 61,885 $ 71,425
Accounts receivable 45,498,895 37,681,055
Inventories 28,484,195 27,315,185
Prepaid expenses and deposits 2,209,818 2,433,415
____________ ____________

76,254,793 67,501,080

Long-Term Receivables (note 3) 1,489,520 1,227,698
Capital Assets (note 4) 22,038,349 23,769,700
Deferred Income Taxes 1,170,074 43,000
Goodwill 370,109 610,674
____________ ____________

$101,322,845 $ 93,152,152

Liabilities

Current Liabilities
Bank Indebtedness $ (1,409,614) $ 12,274,000
Accounts Payable and accrued liabilities 36,851,708 20,115,622
Income taxes payable 1,560,473 (368,837)
Amounts due to parent company 27,435,260 37,897,938
____________ ____________

64,437,827 69,918,723
Long-Term Debt (note 5) 28,000,000 17,000,000
____________ ____________

92,437,827 86,918,723
Shareholder's Equity

Capital Stock
Authorized -
12,000 Common shares
13,649 non-cumulative, preferred shares,
redeemable at $9.75 per share
Issued
10,504 Common shares 610,188 610,188

Retained Earnings 8,274,830 5,623,241
____________ ____________

8,885,018 6,233,429
____________ ____________

$101,322,845 $ 93,152,152

F-63
<PAGE>
Grand & Toy Limited
Statement of Retained Earnings
For the 40 Weeks Ended January 7, 1996
and January 8, 1995
Unaudited (Expressed in Canadian Dollars)

40 Weeks 40 Weeks
Ended Ended
January 7, January 8,
1996 1995

Balance - Beginning of Period $ 4,253,558 $ 4,590,375

Net earnings for the period 4,021,272 1,032,866
____________ ____________

Balance - End of Period $ 8,274,830 $ 5,623,241

F-64

<PAGE>
Grand & Toy Limited
Statement of Earnings
For the 40 Weeks Ended January 7, 1996
and January 8, 1995
Unaudited (Expressed in Canadian Dollars)

40 Weeks 40 Weeks
Ended Ended
January 7, January 8,
1996 1995

Gross Revenue $209,164,793 $212,054,857
____________ ____________

Expenses

Administrative and other expenses 195,422,806 203,568,783
Restructuring Costs (note 6) - 839,750
Interest income (128,207) (96,514)
Financial expenses 3,371,463 3,235,972
Amortization of capital assets 2,848,054 3,170,950
Amortization goodwill 185,049 185,050
____________ ____________

201,699,165 210,903,991
____________ ____________

Income Before Income Taxes 7,465,628 1,150,866

Provision for Income Taxes
Current 3,444,356 118,000
Deferred - -
____________ ____________

3,444,356 118,000
____________ ____________

Net Income for the Period $ 4,021,272 $ 1,032,866

F-65
<PAGE>
Grand & Toy Limited
Statement of Cash Flow
For the 40 Weeks Ended January 7, 1996 and January 8, 1995
Unaudited (Expressed in Canadian Dollars)

40 Weeks 40 Weeks
Ended Ended
January 7, January 8,
1996 1995

Cash Provided By (Used In):

Operating Activities

Net earnings for the period $ 4,021,272 $ 1,032,866

Items not affecting cash
Amortization of capital assets 2,848,054 3,171,000
Amortization of goodwill 185,049 185,000
Loss on disposal of capital assets 154,000 189,000
Deferred Income Taxes 1,000,000 -
____________ ____________

8,208,375 4,577,866

Change in non-cash working capital (1,252,319) (19,530,257)
____________ ____________

6,956,056 (14,952,391)

Investing Activities

Purchase of capital assets (1,672,000) (1,386,000)
Proceeds on disposal of capital assets 505,000 62,000
____________ ____________

(1,167,000) (1,324,000)
____________ ____________

Financing Activities

Decrease in long-term receivables 571,000 -
Increase in long-term debt 2,500,000 6,500,000
____________ ____________

3,071,000 6,500,000
____________ ____________

Change in Cash for the Period 8,860,056 (9,776,391)

Net Bank Balance/(Indebtedness) -
Beginning of Period (7,388,557) (2,426,184)
____________ ____________

Net Bank Balance/(Indebtedness) -
End of Period $ 1,471,499 $(12,202,575)

Net Bank Indebtedness comprised of:
Cash and short-term deposits $ 61,885 $ 71,425
Bank Balance/(Indebtedness) 1,409,614 (12,274,000)
____________ ____________

$ 1,471,499 $(12,202,575)

F-66
<PAGE>
Grand & Toy Limited
Notes to Financial Statements
For the 40 Weeks Ended January 7, 1996 and January 8, 1995
Unaudited (Expressed in Canadian Dollars)

1. Basis of Presentation
The accompanying interim financial statements have been prepared by
the Company. The statements should be read together with the
statements and the accompanying notes included in the Company's
Financial Statements for the Year Ended April 2, 1995. The interim
financial statements have not been audited by independent chartered
accountants, but in the opinion of management, all adjustments
necessary to present fairly the results for the periods have been
included. Except as may be disclosed within these notes, the
adjustments made were of a normal, recurring nature. Interim results
are not necessarily indicative of results that may be expected for
the year.

2. Accounting Policies

(a) Inventories are valued at the lower of cost and net realizable
value. Commercial inventory costs are determined using the
moving average method which approximates cost. Inventories in
retail outlets are valued at cost which is determined by
formula application to the retail value count. In addition to
the year end physical counts, all inventory is physically
counted on a quarterly basis.

(b) Buildings are amortized on the declining balance method at 5%.
Equipment owned and equipment under capital leases are
amortized on the declining balance method at rates ranging from
10% to 30%. Automotive equipment is amortized on the declining
balance method at 30%.

(c) Leasehold interests and improvements are amortized on the
straight-line method over the term of the lease plus the first
renewal, if appropriate.

(d) Goodwill is amortized on a straight-line basis over 4 years.

(e) Generally, revenues from retail sales of office products are
recognized at time of shipment. Profit Sharing income from
owner/operators of retail stores is deferred until such time as
it is considered earned.

(f) The corporation's fiscal year end, prior to the acquisition by
Boise-Cascade Office Products, fell on the Sunday closest to
March 31st. Due to the acquisition, there was a fiscal
period-end at February 4, 1996. Subsequent to February 4,
1996, fiscal years will end December 31 of each year.

F-67

<PAGE>
3. Long-term Receivables
January 7, January 8,
1996 1995

Notes receivable from owner/operators $ 2,041,720 $ 1,633,698
Less: Current portion included in
accounts receivable (552,200) (406,000)
____________ ____________

Long-term portion $ 1,489,520 $ 1,227,698

The notes receivable from owner/operators are repayable over 5 years,
bear interest at 9% per annum. Inventories held by the
owner/operators have been pledged as collateral.

4. Capital Assets
January 7, January 8,
1996 1995
Accumulated
Cost Amortization Net Net

Land $ 1,377,816 $ - $ 1,377,816 $ 1,407,816
Buildings 13,098,772 6,027,028 7,071,744 7,942,845
Automotive Equipment 773,784 713,295 60,489 115,101
Equipment 26,342,422 18,125,204 8,217,218 8,855,478
Leasehold
improvements 12,390,335 7,079,253 5,311,082 5,448,460
___________ ___________ ___________ ___________
$53,983,129 $31,944,780 $22,038,349 $23,769,700

5. Long-Term Debt

Banker's Acceptances

January 7, January 8,
1996 1995

Unsecured non-revolving arrangements due
April 1996 and March 1998. During the
year, the average effective rate of
interest approximated .84% below the
bank's prime rate to their most
preferred customers. $28,000,000 $17,000,000

Repayments of principal planned and/or required over the next five
years were as follows:

Year ending 1996 $ 5,000,000
1997 6,000,000
1998 6,000,000
1999 6,000,000
2000 5,000,000
___________
$28,000,000
F-68

<PAGE>
6. Restructuring Costs
Included in expenses for the forty weeks ended January 8, 1995, are
restructuring charges amounting to $839,750. This amount includes
primarily asset write-downs, lease buy-outs, employee severances and
other related expenses in respect to the company's closure of one
warehouse, 12 retail outlets and the elimination of approximately 120
jobs.

7. Operating Lease Commitments

Gross Sub-Leases Net

$34,707,929 $ 8,449,457 $26,258,472

8. Related Party Transactions

i) Sales of approximately $475,000 were made to affiliates during
the period.

ii) Amounts due to affiliates have no fixed terms of repayment and
include both interest and non-interest bearing balances.
Interest rates charged varied between 4.6% and 7.6% during the
year.

iii) Interest charges from affiliates during the year amounted to
approximately $1,660,000.

F-69

<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION AND SUBSIDIARIES

PRO FORMA CONDENSED FINANCIAL STATEMENTS

Basis of Preparation. The following unaudited Pro Forma Condensed
Financial Statements reflect the Company's consolidated financial position and
results of operations as of and for the periods indicated under the
assumptions set forth in the respective notes. These statements have been
prepared from and should be read in conjunction with the historical
consolidated financial statements of Boise Cascade Office Products Corporation
and the historical financial statements of Grand & Toy, Limited, Word
Technology Systems, Inc. (WTS), and Neat Ideas, Ltd. which are included in
this registration statement.

These unaudited Pro Forma Consolidated Financial Statements give effect
to the following transactions:

During 1995, the Company acquired ten office supply businesses. The
acquisitions were made throughout the year. In 1996, through March 31, the
Company completed five acquisitions. The acquisitions were accounted for
under the purchase method of accounting. Accordingly, the purchase prices
were allocated to the assets acquired and liabilities assumed based upon their
estimated fair values. The excess of the purchase prices over the estimated
fair value of the net assets acquired was recorded as goodwill and is being
amortized over 40 years. The initial purchase price allocations may be
adjusted within one year of the date of purchase for changes in estimates of
the fair value of assets and liabilities. Such adjustments are not expected
to be significant to results of operations or the financial position of the
Company. The results of operations of the acquired businesses are included in
the Company's operations subsequent to the dates of acquisitions.

The 1995 acquisitions were made for cash of $62.1 million, payables to
the sellers of $10.6 million, and issuance of Company stock and a stock note
valued at $18.2 million at the time of issuance. The 1996 acquisitions were
made for cash of approximately $129.3 million and payables to the sellers of
$7.9 million. The Company funds its acquisitions through its common stock
offering in April 1995, operating cash flow, issuance of additional equity
securities and borrowings under its $225 million revolving credit facility.

In April 1996, the Company's board of directors authorized a two-for-one
split of the Company's common stock in the form of a 100% stock dividend.
Each shareholder of record at the close of business on May 6, 1996, received
one additional share for each share held on that date. The new shares were
distributed on May 20, 1996. All share amounts, net income per share, and
average common shares outstanding have been restated to reflect the stock
split for each period presented.

The unaudited pro forma income statement data for the year ended
December 31, 1995, gives effect to the ten acquisitions completed by the
Company in 1995 and the five 1996 acquisitions completed by the Company
through March 31, 1996, as if they had occurred January 1, 1995. The
unaudited pro forma income statement data for the three months ended March 31,
1996, gives effect to the five 1996 acquisitions completed by the Company
through March 31, 1996, as if they had occurred January 1, 1996. The
unaudited pro forma earnings per common share of $.70 for the year ended

F-70
<PAGE>
December 31, 1995, assumes that the shares issued to BCC and to the public in
the Offerings were issued on January 1, 1995, and the shares issued to effect
various acquisitions were issued on the date of acquisition. The unaudited
pro forma earnings per common share of $.68 for the year ended December 31,
1995, assumes that the shares issued to BCC and to the public in the Offerings
and the shares issued to effect various transactions were all issued on
January 1, 1995. The unaudited actual and pro forma earnings per common share
of $.25 for the three months ended March 31, 1996, are based upon the average
number of common shares outstanding pursuant to the shares issued to BCC and
to the public in the Offerings, shares issued to effect various acquisitions,
and common shares issued as a result of stock options exercised.

The unaudited pro forma financial information does not necessarily
represent the consolidated financial position and results of operations that
actually would have occurred for the periods presented if the Company had
completed the acquisitions on the bases assumed above and are not necessarily
indicative of the results of future operations.

F-71
<PAGE>
<TABLE>
Boise Cascade Office Products Corporation
Pro Forma Condensed Statement of Income
For the Year Ended December 31, 1995
(expressed in thousands of U.S. dollars
except earnings per common share)
(unaudited)

<CAPTION>
Historical (Note 1)
Word All All Other 1996
Boise Cascade Technology Other 1995 Acquisitions
Office Systems, Neat Ideas, Acquisitions Completed
Products Inc. for Ltd. for for the Grand & Toy Through Pro Forma
Corporation the Period the Period Periods Limited for March 31, Boise
for the January 1, January 1, January 1, the Twelve 1996 For the Cascade
Year Ended 1995 through 1995 through 1995 through Months Ended Year Ended Office
December 31, September 29, December 29, the date of January 7, December 31, Pro Forma Products
1995 1995 1995 Acquisition 1996 1995 Adjustments Corporation
(Note 2)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $1,315,953 $ 56,398 $ 34,852 $ 65,764 $ 203,210 $ 59,714 $ - $1,735,891
Cost of sales 980,564 50,314 23,265 47,765 146,311 41,718 - 1,289,937
__________ __________ __________ __________ __________ __________ __________ __________
Gross profit 335,389 6,084 11,587 17,999 56,899 17,996 - 445,954
__________ __________ __________ __________ __________ __________ __________ __________

Operating expenses 263,635 5,427 9,661 16,657 50,654 14,308 - 360,342
Goodwill amortization 2,287 - - - 175 2 3,459 (b) 5,923
__________ __________ __________ __________ __________ __________ __________ __________
265,922 5,427 9,661 16,657 50,829 14,310 3,459 366,265
__________ __________ __________ __________ __________ __________ __________ __________
Income from
operations 69,467 657 1,926 1,342 6,070 3,686 (3,469) 79,689
Other income
(expense), net 1,903 (553) (92) 229 (2,895) (26) (6,778)(a) (8,212)
__________ __________ __________ __________ __________ __________ __________ __________
Income before
income taxes 71,370 104 1,834 1,571 3,175 3,660 (10,237) 71,477
Income tax expense
(benefit) 28,191 - 347 7 1,241 76 2,415 (d) 29,130
- - - - - - (3,147)(c) -
__________ __________ __________ __________ __________ __________ __________ __________
Net income $ 43,179 $ 104 $ 1,487 $ 1,564 $ 1,934 $ 3,584 $ (9,505) $ 42,347

Pro forma earnings per
common share $ .70 $ .68
Pro forma average common
shares outstanding 61,660 62,292

The accompanying notes are an integral part of this Pro Forma Financial Statement.
</TABLE>
F-72
<PAGE>
<TABLE>
Boise Cascade Office Products Corporation
Pro Forma Condensed Statement of Income
For the Three Months Ended March 31, 1996
(expressed in thousands of U.S. dollars
except earnings per common share)
(unaudited)

<CAPTION>
Historical (Note 1)
Boise Cascade All Other 1996
Office Products Acquisitions
Corporation Grand & Toy for Periods Pro Forma
for the Three Limited for the January 1, 1996 Boise Cascade
Months Ended One Month Ended through the date Pro Forma Office Products
March 31, 1996 February 4, 1996 of Acquisition Adjustments Corporation
(Note 2)
<S> <C> <C> <C> <C> <C>
Net sales $ 461,423 $ 21,108 $ 8,133 $ - $ 490,664
Cost of sales 338,526 15,549 5,668 - 359,743
__________ __________ __________ __________ __________
Gross profit 122,897 5,559 2,465 - 130,921
__________ __________ __________ __________ __________

Operating expenses 93,949 5,150 2,046 - 101,145
Goodwill amortization 1,380 14 - 204 (b) 1,598
__________ __________ __________ __________ __________
95,329 5,164 2,046 204 102,743
__________ __________ __________ __________ __________
Income from operations 27,568 395 419 (204) 28,178
Other expense, net (1,241) (70) 14 (645)(a) (1,942)
__________ __________ __________ __________ __________
Income before income taxes 26,327 325 433 (849) 26,236
Income tax expense 10,764 153 15 166 (d) 10,824
- - - (274)(c) -
__________ __________ __________ __________ __________
Net income $ 15,563 $ 172 $ 418 $ (741) $ 15,412

Pro forma earnings per
common share $ .25 $ .25
Pro forma average common
shares outstanding 62,306 62,306

The accompanying notes are an integral part of this Pro Forma Financial Statement.
</TABLE>
F-73
<PAGE>
BOISE CASCADE OFFICE PRODUCTS CORPORATION

NOTES TO PRO FORMA CONDENSED FINANCIAL STATEMENTS

1. DESCRIPTION OF ACQUISITIONS

The following lists the acquisitions made by the Company in 1995 and 1996
included in the pro forma financial information.

<TABLE>
<CAPTION>
Historical Sales
From January 1, 1995
Through the Date
of 1995 Acquisitions
and Through
December 31, 1995
Date of Acquisition Business Location for 1996 Acquisitions
(expressed in thousands
of U.S. Dollars)

<C> <S> <C> <C>
February 17, 1995 Wasserstrom Columbus, OH $ 1,779
April 3, 1995 Allied Office Supply Norfolk, VA 5,957
July 28, 1995 Office Resources, Inc. (ORI) Louisville, KY 11,751
August 25, 1995 PBM, Inc. Cleveland, OH 8,124
September 1, 1995 Fisher's Office Products Boise, ID 4,129
September 29, 1995 Macke Business Products Rochester, NY 17,420
September 29, 1995 Word Technology Systems,
Inc. (WTS) St. Louis, MO 56,398
October 31, 1995 Tampa Office Supplies Tampa, FL 4,131
December 29, 1995 Neat Ideas, Ltd. Doncaster, Great Britain 34,852
December 1, 1995 Premiere Business Products Pittsburgh, PA 12,473
January 31, 1996 Sierra Vista Office
Products, Inc. Albuquerque, NM 9,625
February 5, 1996 Grand & Toy, Limited Canada 203,210
February 9, 1996 Loring, Short & Harmon, Inc. Portland, ME
39,619
February 9, 1996 McAuliffe's Burlington, VT
March 29, 1996 Office Essentials Milwaukee, WI 10,470

</TABLE>

For more information regarding 1995 and 1996 acquisitions, see Note 9,
Notes to Financial Statements for the year ended December 31, 1995, and
Note 6, Notes to Financial Statements for the three months ended March
31, 1996, in this registration statement, which information is
incorporated herein by this reference.

On February 5, 1996, the Company completed the acquisition of 100% of
the shares of Grand & Toy Limited (Grand & Toy) from Cara Operations
Limited (Toronto). The negotiated purchase price was approximately
C$140 million (US$104 million). In addition, the Company recorded
liabilities of approximately $7.4 million, which are included in the
recorded purchase price of Grand & Toy, to modify and transition
activities such as distribution, marketing, and other functions.
Further adjustments to the preliminary allocation of the purchase price
may be made within one year of the acquisition date. The acquisition
was funded primarily from borrowings under the Company's $225 million
revolving credit agreement. Grand & Toy owns and operates six office
products distribution centers and approximately 80 retail stores across
Canada.

Other 1996 acquisitions completed through March 31, 1996, were made by
purchasing the net assets or the stock of the businesses acquired for a
combination of $27.2 million in cash and $7.9 million payable to
sellers.

2. PRO FORMA INCOME STATEMENTS

The pro forma condensed income statements give effect to the adjustments
described below:
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a. To record interest expense assuming that the amounts borrowed
under the Company's revolving credit agreement to fund the
acquisitions were outstanding for the year ended December 31,
1995, and the three months ended March 31, 1996.

b. To increase goodwill amortization for the amount of goodwill
recorded in the preliminary allocations of the acquisition costs.

c. To record the tax effects of the above pro forma adjustments.

d. To record income tax expense for those businesses acquired where
taxes were not provided.

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