Table of Contents

 

			Page
Article I Definitions			1
Section 1.1	Definitions		1
Section 1.2	Other Terms		3
Section 1.3	Computation of Time Periods		3
Article II Purchase, Conveyance and Servicing of Receivables			3
Section 2.1	Sale		3
Section 2.2	Servicing of Receivables		4
Article III Consideration and Payment; Receivables			4
Section 3.1	Conveyance Amount		4
Section 3.2	Payment of Conveyance Amount		5
Section 3.3	Settlement		6
Article IV Representations and Warranties			6
Section 4.1	Seller’s Representations and Warranties		6
Article V Covenants of the Seller			10
Section 5.1	Covenants of the Seller		10
Article VI Repurchase Obligation			13
Section 6.1	Mandatory Repurchase		13
Section 6.2	No Recourse		13
Article VII Conditions Precedent			13
Section 7.1	Conditions to the Purchaser’s Obligations Regarding Receivables		13
Article VIII Term and Termination			14
Section 8.1	Term		14
Section 8.2	Effect of Purchase Termination Date		14
Article IX Indemnification			15
Section 9.1	Indemnities by the Seller		15
Article X Miscellaneous Provisions			15
Section 10.1	Amendment		15
Section 10.2	GOVERNING LAW; Submission to Jurisdiction		15
Section 10.3	Notices		16
Section 10.4	Severability of Provisions		17
Section 10.5	Assignment		17
Section 10.6	Further Assurances		17
Section 10.7	No Waiver; Cumulative Remedies		17

 

i

 

Section 10.8	Counterparts		17
Section 10.9	Binding Effect; Third-Party Beneficiaries		18
Section 10.10	Merger and Integration		18
Section 10.11	Headings		18
Section 10.12	Exhibits		18

 

Exhibits
Exhibit A	Form of Subordinated Note
Exhibit B	Credit and Collection Policy
Schedules
Schedule 4.1(g)		List of Actions and Suits
Schedule 4.1(i)		Names, Jurisdictions of Formation, Type of Entity and Locations of Certain Offices and Records
Schedule 4.1(j)		List of Subsidiaries, Divisions and Tradenames; FEIN
Schedule 4.1(p)		List of Blocked Account Banks and Blocked Accounts

 

ii

 

RECEIVABLES PURCHASE AGREEMENT

 

This RECEIVABLES PURCHASE AGREEMENT, dated as of March 3, 2009 (as amended, supplemented or otherwise modified and in effect from time to time, this “ Agreement ”), between UNITED STATIONERS FINANCIAL SERVICES, LLC , an Illinois limited liability company, as seller (the “ Seller ”) and UNITED STATIONERS RECEIVABLES, LLC , an Illinois limited liability company, as purchaser (the “ Purchaser ”).

 

W I T N E S S E T H :

 

WHEREAS, the Purchaser desires to purchase from the Seller from time to time certain accounts receivable both currently existing and hereafter generated in the normal course of the Seller’s or the Originator’s business pursuant to written agreements or with invoices on open accounts;

 

WHEREAS, the Seller desires to sell and assign from time to time such certain accounts receivable to the Purchaser upon the terms and conditions hereinafter set forth;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by and between the Purchaser and the Seller as follows:

 

Article I

 

Definitions

 

Section 1.1            Definitions .

 

All capitalized terms used herein shall have the meanings specified herein or, if not so specified, the meaning specified in, or incorporated by reference into, the Transfer Agreement (as defined below), and shall include in the singular number the plural and in the plural number the singular:

 

Advance :  As defined in Section 3.2(a) .

 

Advance Limit :  As defined in Section 3.2(a) .

 

Conveyance Amount :  As defined in Section 3.1 hereof.

 

Discount Purchase Percentage :  A percentage determined by the Purchaser and the Seller from time to time (but at least on a quarterly basis).

 

Eligible Receivable :  As defined in the Transfer Agreement.

 

Investment Company Act : The Investment Company Act of 1940, as amended.

 

 

Net Worth :  At any time, the excess, if any, of (a) the aggregate Unpaid Balances of the Receivables at such time, plus all cash Collections, if any, on deposit in the Blocked Accounts and/or the Collection Account at such time to the extent such amounts are available for and applicable to the payment of Net Investment, over (b) the sum of (i) the Net Investment outstanding at such time, (ii) the aggregate outstanding amount of Advances (including any Advance to be made on the date of determination), (iii) the Servicing Fee Reserve and (iv) the Yield Reserve.

 

Originator :  United Stationers Supply Co., an Illinois corporation.

 

Prime Rate :  On any day, the rate of interest equal to the U.S. Prime Rate published in the “Money Rates” section of the Wall Street Journal (National Edition) on such day.

 

Purchase Termination Date :  As defined in Section 8.1 hereof.

 

Purchaser :  United Stationers Receivables, LLC, an Illinois limited liability company, and its successors and assigns.

 

Receivables Sale Agreement :  The Receivables Sale Agreement, dated March 3, 2009, by and between the Originator and the Seller, as such agreement may be amended, modified or supplemented from time to time.

 

Related Security :  As defined in the Transfer Agreement.

 

Relevant UCC :  The Uniform Commercial Code as in effect in the States of New York or Illinois, as applicable.

 

Required Capital Amount :  As of any date of determination, an amount equal to 10% of the aggregate Unpaid Balance of Receivables.

 

Securities Exchange Act :  The Securities Exchange Act of 1934, as amended.

 

Secured Obligations :  As defined in Section 2.1(d)  hereof.

 

Seller :  United Stationers Financial Services, LLC, an Illinois limited liability company, and its successors and assigns.

 

Subordinated Note :  As defined in Section 3.2(a) .

 

Transfer Agreement :  The Transfer and Administration Agreement, dated as of March 3, 2009, by and among the Purchaser, the Originator, the Servicer, the Seller, the Class Agents, the Agent and the Investors, as such agreement may be amended, modified or supplemented from time to time.

 

2

 

Section 1.2            Other Terms .

 

All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles.  All terms used in Article 9 of the Relevant UCC, and not specifically defined herein, are used herein as defined in such Article 9.

 

Section 1.3            Computation of Time Periods .

 

Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding.”

 

Article II

 

Purchase, Conveyance and Servicing of Receivables

 

Section 2.1            Sale .

 

(a)           Upon the terms and subject to the conditions set forth herein, the Seller hereby sells, conveys, transfers and absolutely assigns to the Purchaser, and the Purchaser hereby accepts such sale, conveyance, transfer and absolute assignment from the Seller, on the terms and subject to the conditions specifically set forth herein, of all of the Seller’s right, title and interest, whether now owned or hereafter acquired, in, to and under all Receivables and the Related Security, Collections and proceeds relating thereto, provided that the Purchase Termination Date has not occurred.  Any such foregoing sale, assignment, transfer and conveyance does not constitute an assumption by the Purchaser of any obligations of the Seller or any other Person to Obligors or to any other Person in connection with such Receivables and the Related Security, Collections and proceeds relating thereto or other agreement and instrument relating thereto.  On the date hereof and on each Business Day thereafter to, but including the Purchase Termination Date, the Seller shall transfer to the Purchaser, in accordance with the second preceding sentence, all Receivables then owned by the Seller.

 

(b)           In connection with any such foregoing sale, the Seller agrees to record and file on or prior to the Closing Date, at its own expense, a financing statement or statements with respect to the Receivables and the other property described in Section 2.1(a)  sold and to be sold by the Seller hereunder meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect and protect the interests of the Purchaser created hereby under the Relevant UCC against all creditors of and purchasers from the Seller, and to deliver either the originals of such financing statements or a file-stamped copy of such financing statements or other evidence of such filings to the Purchaser on the Closing Date.

 

(c)           The Seller agrees that from time to time, at its expense, it will promptly authenticate and deliver all instruments and documents and take all actions as may be necessary or as the Purchaser may reasonably request in order to perfect or protect the interest of the Purchaser in the Receivables and other property purchased from the Seller hereunder or to enable the Purchaser to exercise or enforce any of its rights hereunder.  Without limiting the foregoing, the Seller will, in order to accurately reflect any purchase and sale transaction, authenticate and file such financing or continuation statements or amendments thereto or assignments thereof (as permitted pursuant hereto) as may be requested by the Purchaser, and upon the request of the

 

3

 

Purchaser, mark its master data processing records and other documents with a legend describing the purchase by the Purchaser of Receivables and the subsequent transfer thereof pursuant to the Transfer Agreement and stating “An interest in these accounts receivable has been conveyed to Bank of America, National Association, as agent for the benefit of certain investors, pursuant to a Transfer Agreement dated as of March 3, 2009.”  The Seller shall, upon request of the Purchaser, obtain such additional search reports as the Purchaser shall reasonably request.  To the fullest extent permitted by applicable law, the Purchaser shall be permitted to sign and file continuation statements and amendments thereto and assignments thereof without the Seller’s signature.  A reproduction of this Agreement or any financing statement shall be sufficient as a financing statement.

 

(d)           It is the express intent of the Seller and the Purchaser that any conveyance of Receivables by the Seller to the Purchaser pursuant to this Agreement be construed as a sale of such Receivables by the Seller to the Purchaser.  Further, it is not the intention of the Seller and the Purchaser that such conveyance be deemed a grant of a security interest in any Receivables by the Seller to the Purchaser to secure a debt or other obligation of the Seller.  However, in case that, notwithstanding the intent of the parties, any Receivables conveyed hereunder are construed to constitute property of the Seller, then (i) this Agreement also shall be deemed to be, and hereby is, a security agreement within the meaning of the Relevant UCC; and (ii) the conveyance by the Seller provided for in this Agreement shall be deemed to be, and the Seller hereby grants to the Purchaser, a security interest in, to and under all of the Seller’s right, title and interest in, to and under all Receivables, the Related Security, Collections and the proceeds thereof conveyed by the Seller to the Purchaser, to secure the rights of the Purchaser set forth in this Agreement or as may be determined in connection therewith by applicable law (collectively, the “ Secured Obligations ”).  The Seller and the Purchaser shall, to the extent consistent with this Agreement, take such actions as may be necessary to ensure that, if this Agreement were deemed to create a security interest in, and not a sale of, Receivables, such security interest would be deemed to be a perfected security interest in favor of the Purchaser under applicable law and will be maintained as such throughout the term of this Agreement.

 

Section 2.2            Servicing of Receivables .

 

The servicing, administering and collection of the Receivables and the Related Security, Collections and proceeds thereof conveyed hereunder shall be conducted by the Servicer as set forth and in accordance with the Transfer Agreement.  The Purchaser hereby appoints the Servicer as its agent to enforce the Purchaser’s rights and interests in, to and under the Receivables, the Related Security, Collections and proceeds with respect thereto.

 

Article III

 

Consideration and Payment; Receivables

 

Section 3.1            Conveyance Amount .

 

(a)           The consideration for any Receivable and the Related Security, Collections and proceeds thereof conveyed, transferred and assigned to the Purchaser by the Seller under this Agreement shall be a dollar amount equal to the product of (i) the aggregate Unpaid Balance of

 

4

 

the Receivables sold pursuant to such conveyance, and (ii) the Discount Purchase Percentage at such time (the “ Conveyance Amount ”).

 

Section 3.2            Payment of Conveyance Amount .

 

(a)           (x) The Conveyance Amount for any Receivables and related property conveyed hereunder shall be paid in the following manner:  (i) by payment of cash in immediately available funds, or (ii) if Purchaser does not have sufficient cash to pay the Conveyance Amount owed to the Seller, by means of an advance under the Subordinated Note owed to the Seller (each such advance and any other advance under the Subordinated Note, an “ Advance ”) and/or (y) all or a portion of any transfer of Receivables and the related Conveyance Amount may be made in the form of capital contributed by the Seller to Purchaser in the form of a contribution of the additional Receivables or (iii) any combination of the foregoing, as determined by the Seller and the Purchaser at such time.  In the event the Purchaser does not have sufficient cash to pay the Conveyance Amount owed to the Seller due on any sale date and the Seller is not willing to consent to the payment of such insufficiency by means of a capital contribution, such insufficiency shall be evidenced by the making of an Advance on such date of a purchase hereunder in an original principal amount equal to such cash shortfall owed to the Seller; provided , however , that the Seller shall not make an Advance to the Purchaser in an aggregate amount outstanding exceeding the lesser of (i) the remaining unpaid portion of such Conveyance Amount and (ii) the maximum Advance that could be made without rendering the Purchaser’s Net Worth less than the Required Capital Amount (the “ Advance Limit ”).  All Advances made by the Seller to Purchaser shall be evidenced by a single subordinated note, duly executed on behalf of Purchaser, in substantially the form of Exhibit A annexed hereto, delivered and payable to the Seller in a principal amount equal to the Advance Limit (the “ Subordinated Note ”).  The Seller is hereby authorized by the Purchaser to endorse on the schedule attached to the Subordinated Note (or a continuation of such schedule attached thereto and made a part thereof) an appropriate notation evidencing the date and amount of each Advance, as well as the date and amount of each payment with respect thereto; provided , however , that the failure of any Person to make such a notation shall not affect any obligations of Purchaser thereunder.  Any such notation shall be conclusive and binding as to the date and amount of such Advance, or payment of principal or interest thereon, absent manifest error.

 

(b)           The terms and conditions of the Subordinated Note and all Advances thereunder shall be as follows:

 

(i)            Repayment of Advances .  All amounts paid by the Purchaser with respect to the Advances shall be allocated first to the repayment of accrued interest until all such interest is paid, and then to the outstanding principal amount of the Advances.  Subject to the provisions of this Agreement, the Purchaser may borrow, repay and reborrow Advances on and after the Closing Date and prior to the termination of this Agreement.

 

(ii)           Interest .  The Subordinated Note shall bear interest from its date on the outstanding principal balance thereof at a rate per annum equal to the Prime Rate in effect on the first Business Day of each month .   Interest on each Advance shall be computed based on the number of days elapsed in a year of 360 days.

 

5

 

(iii)          Sole and Exclusive Remedy/Subordination .  The Purchaser shall be obligated to repay Advances to the Seller only to the extent of funds available to the Purchaser from Collections on Receivables and, to the extent that such payments are insufficient to pay all amounts owing to the Seller under the Subordinated Note, the Seller shall not have any claim against the Purchaser for such amounts and no further or additional recourse shall be available against the Purchaser.  The Subordinated Note shall be fully subordinated to any rights of the Agent, the Class Agents, the Investors and their permitted assigns pursuant to the Transfer Agreement, and shall not evidence any rights in the Receivables.

 

(iv)          Offsets, etc.   The Purchaser may offset any amount due and owing by the Seller against any amount due and owing by Purchaser to the Seller under the terms of the Subordinated Note.

 

Section 3.3            Settlement .

 

(a)           Dilutions .  If on any day any Receivable becomes subject to any Dilution, the Seller shall be deemed to have received on such day a Collection of such Receivable in the amount of the Unpaid Balance (as determined immediately prior to such Dilution) of such Receivable (if such Receivable is canceled) or otherwise in the amount of such reduction.

 

(b)           Payment of Deemed Collections .  Not later than the Business Day immediately following the date on which the Seller is deemed to have received a Collection under this Section 3.3 , the Seller shall pay such amount of Deemed Collections to the Purchaser (i) prior to the Termination Date, in the following order: (a) first, by a reduction in Conveyance Amount paid by the Purchaser for new Receivables on such day, (b) second, by a reduction of the outstanding Advances, such reduction to occur once per month, and (c) third, by a cash payment in immediately available funds (or any combination of the foregoing as reasonably determined by the Seller and the SPV at such time); and (ii) following the Termination Date, by a cash payment, in immediately available funds.

 

Article IV

 

Representations and Warranties

 

Section 4.1            Seller’s Representations and Warranties .

 

The Seller represents and warrants to the Purchaser, the Agent, the Class Agents, and the Investors, as to itself, that, on the Closing Date and on each date that Receivables are transferred by it pursuant to Section 2.1 :

 

(a)           Corporate Existence and Power .  It (i) is a limited liability company duly organized, validly existing and in good standing under the laws of Illinois, which is its sole jurisdiction of formation, (ii) has all corporate power and all licenses, authorizations, consents and approvals of all Official Bodies required to carry on its business in each jurisdiction in which its business is now and proposed to be conducted (except where the failure to have any such licenses, authorizations, consents and approvals would not individually or in the aggregate have a Material Adverse Effect) and (iii) is duly qualified to do business and is in good standing in

 

6

 

every other jurisdiction in which the nature of its business requires it to be so qualified, except where the failure to be so qualified or in good standing would not have a Material Adverse Effect.

 

(b)           Corporate and Governmental Authorization; Contravention .  The execution, delivery and performance by it of this Agreement and the other Transaction Documents to which it is a party are (i) within the its organizational powers, (ii) have been duly authorized by all necessary organizational action, (iii) require no action by or in respect of, or filing with, any Official Body or official thereof (except as contemplated by Sections 5.1(f), 5.1(g) and 7.7 of the Transfer Agreement, all of which have been (or as of the Closing Date will have been) duly made and in full force and effect), (iv) do not contravene or constitute a default under (A) its organizational documents, (B) any Law applicable to it, (C) any contractual restriction binding on or affecting it or its property or (D) any order, writ, judgment, award, injunction, decree or other instrument binding on or affecting it or its property, or (v) result in the creation or imposition of any Adverse Claim upon or with respect to its property or the property of any of its Subsidiaries (except as contemplated hereby), for purposes of clause (iv) hereof except to the extent such failure would not be reasonably expected to have a Material Adverse Effect.

 

(c)           Binding Effect .  Each of this Agreement and the other Transaction Documents to which it is a party has been duly executed and delivered and constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, moratorium or other similar laws affecting the rights of creditors generally.

 

(d)           Perfection .  It is the owner of all of the Receivables and the other Affected Assets, free and clear of all Adverse Claims (other than any Adverse Claim arising hereunder) and upon the making of the initial sale to the Purchaser on the Closing Date and at all times thereafter until the Final Payout Date, all financing statements and other documents required to be recorded or filed in order to perfect and protect the interest of the Purchaser in the Asset Interest against all creditors of and purchasers from the Seller will have been duly filed in each filing office necessary for such purpose and all filing fees and taxes, if any, payable in connection with such filings shall have been paid in full.

 

(e)           Accuracy of Information .  All information heretofore furnished by it to the Purchaser, any Investor, any Class Agent or the Agent for purposes of or in connection with this Agreement or any Transaction Document or any transaction contemplated thereby, taken as a whole, is, and all such information hereafter furnished by it to the Purchaser, any Investor, any Class Agent or the Agent will be, true, complete and accurate in every material respect, on the date such information is stated or certified, and no such item contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading.

 

(f)            Tax Status .  It has (i) timely filed all tax returns (federal, state and local) required to be filed, (ii) paid or made adequate provision for the payment of all taxes, assessments and other governmental charges except with respect to clauses (i) and (ii), for taxes which are being

 

7

 

contested in good faith and for which appropriate reserves are maintained in accordance with GAAP.

 

(g)           Action, Suits .  It is not in violation of any order of any Official Body or arbitrator, except where such violation would not be reasonably expected to have a Material Adverse Effect.  Except as set forth on Schedule 4.1(g) , there are no actions, suits, litigation or proceedings pending, or to its knowledge, threatened, against or affecting it or any of its Affiliates or their respective properties, in or before any Official Body or arbitrator, which may, individually or in the aggregate, have a Material Adverse Effect on the Seller.

 

(h)           Use of Proceeds .  No proceeds of any sale hereunder will be used by it (i) to acquire any security in any transaction which is subject to Section 13 or 14 of the Securities Exchange Act of 1934, (ii) to acquire any equity security of a class which is registered pursuant to Section 12 of such act or (iii) for