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Exhibit 4(c)
ESCROW AGREEMENT
Dated as of February 24, 1997
by and between
P.H. GLATFELTER COMPANY
and
THE BANK OF NEW YORK, as Trustee
Relating to the $150,000,000
5-7/8% Notes
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ESCROW AGREEMENT
AGREEMENT dated as of February 24, 1997 by and between
P.H. GLATFELTER COMPANY (the "Company") and THE BANK OF NEW YORK
(the "Trustee").
R E C I T A L S :
A. Pursuant to a Trust Indenture dated as of January 15, 1993
between the Company and the Trustee, as successor Trustee (the "Indenture"), the
Company has previously issued its 5-7/8% Notes due March 1, 1998 in the
aggregate principal amount of $150,000,000 (the "Securities").
B. The Securities will become fully due and payable on March
1, 1998.
C. The Company has requested that it be released from its
obligations under Sections 3.6, 3.7, 3.8, 3.9, and 3.10 of the Indenture with
respect to the Securities, such release to be effected in accordance with
Section 10.1(B) of the Indenture.
D. Each of the terms, unless otherwise defined herein, shall
have the meaning assigned to it in the Indenture.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto, intending to be legally bound hereby,
covenant and agree as follows:
Section 1. Deposit with Trustee. The Trustee hereby
acknowledges receipt from the Company of certain direct obligations of the
United States of America, backed by its full faith and credit ("U.S. Government
Obligations") described in Schedule A hereto and agrees to hold such U.S.
Government Obligations in an escrow account (the "Account"). The U.S. Government
Obligations described in Schedule A are hereby irrevocably deposited with the
Trustee by the Company for the purposes set forth herein.
Section 2. Application of Moneys in the Account. The Trustee
irrevocably agrees to apply the principal amount of and interest on the U.S.
Government Obligations held in the Account
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as the same become due and such other moneys in the Account available therefor
to pay the interest on the Securities as the same becomes due and to pay the
principal of the Securities at the maturity thereof on March 1, 1998. Except as
otherwise provided in Sections 3 and 6 of this Agreement, any portion of the
realized principal of and interest on the U.S. Government Obligations or other
moneys on deposit in the Account not needed at the time to make the aforesaid
payments on the Securities shall remain on deposit in the Account, uninvested,
except as provided in Section 3 hereof, in trust for the benefit of the holders
of the Securities until applied as aforesaid.
Section 3. Reinvestment of Account and Substitution
for U.S. Government Obligations.
(a) The Trustee shall, at the written direction of the
Company, reinvest any portion of the realized principal of and interest on the
U.S. Government Obligations or other moneys on deposit in the Account not needed
at the time to make the payments required under Section 2 of this Agreement in
such U.S. Government Obligations as the Company shall so direct; provided that
the Company shall determine that all such investments shall mature, or be
subject to redemption by the Trustee at not less than the principal amount
thereof or the cost of acquisition (whichever is lower), not later than the date
when such amounts will be needed for purposes of Section 2 hereof.
(b) At the written direction of the Company and upon
compliance with the conditions hereinafter stated, the Trustee shall sell,
transfer or otherwise dispose of or request the redemption of such portion of
the U.S. Government Obligations held in the Account and shall substitute such
U.S. Government Obligations therefor as the Company shall so direct, which
substituted U.S. Government Obligations may or may not permit the redemption
thereof at the option of the Company. The Trustee shall purchase such
substituted U.S. Government Obligations with the proceeds derived from the sale,
transfer, disposition or redemption of the U.S. Government Obligations held in
the Account and any other moneys available therefor in the Account. The
transactions may be effected only if the Company shall have first provided the
Trustee with a certificate from an independent certified accountant that the
aggregate principal amount of the U.S. Government Obligations to be substituted,
together with the principal amount of any U.S. Government Obligations remaining,
and the interest income to be earned thereon and other money available therefor
in the Account, will be sufficient to permit the Trustee to make all payments
required by Section 2 hereof and not theretofore paid.
(c) Except as provided in this Section 3, the Trustee shall
have no power or duty to invest any moneys held in the Account or to sell,
transfer or otherwise dispose of any U.S.
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Government Obligations except to a successor trustee under the Indenture.
Section 4. Payment of Fees and Expenses. The Company agrees to
pay the Trustee's fees and expenses, including but not limited to those related
to payment of the principal of, and interest on, the Securities and the fees and
expenses of any other paying agent due or to become due with respect to its
acting as Trustee and paying agent in connection with the Securities. The
Trustee agrees that it shall have no claim or lien whatsoever on any of the
moneys, U.S. Government Obligations on deposit in the Account for the payment of
fees and expenses for services rendered or costs incurred by the Trustee under
this Agreement or otherwise.
Section 5. Trustee's Acknowledgment of Covenant Defeasance and
Release of Covenants in the Indenture with Respect to Securities. In reliance
upon the computations in the report prepared by Bear Xxxxxxx & Co. Inc., the
mathematical accuracy of which was verified by Deloitte & Touche LLP in their
report dated February 24, 1997, the Company represents to the Trustee that the
U.S. Government Obligations shall mature at such times and shall provide
sufficient moneys, together with the cash deposit and any other moneys and
securities then on deposit in the Account, to provide for the payment of the
principal of and interest on the Securities in accordance with Section 2. The
Trustee, in reliance upon the foregoing representation of the Company, hereby
acknowledges that the principal of and interest on the U.S. Government
Obligations, as received, together with other moneys being deposited in the
Account, will provide sufficient moneys to pay the interest on the Securities as
the same becomes due on March 1, 1998. Upon receipt by the Trustee of an
Officer's Certificate and an Opinion of Counsel that the condition set forth in
Section 10.1(B)(b) of the Indenture has been satisfied, the covenants of the
Company set forth in Sections 3.6, 3.7, 3.8, 3.9 and 3.10 of the Indenture shall
be released.
Section 6. Termination. This Agreement shall terminate when
all transfers, payments and other acts required to be made or taken by the
Trustee under the provisions hereof shall have been made or taken.
Section 7. Severability. If any one or more of the covenants
or agreements provided in this Agreement on the part of the Company or the
Trustee to be performed should be determined by a court of competent
jurisdiction to be contrary to law, such covenant or agreement shall be deemed
and construed to be severable from the remaining covenants and agreements herein
contained and shall in no way affect the validity of the remaining provisions of
this Agreement.
Section 8. Successors and Assigns. All of the covenants,
promises and agreements hereunder of the Company shall
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be binding upon, and inure to the benefit of, its respective successors and
assigns. All of the covenants, promises and agreements hereunder of the Trustee
shall be binding upon, and inure to the benefit of, any successor trustee under
the Indenture.
Section 9. Governing Law. This Agreement shall be governed by
and construed in accordance with the law of the State of New York.
Section 10. Headings. Any headings preceding the text of the
several Sections hereof shall be solely for convenience of reference and shall
not constitute a part of this Agreement, nor shall they affect its meaning,
construction or effect.
Section 11. Counterparts. This Agreement may be executed in
several counterparts, all or any of which shall be regarded for all purposes as
one original and shall constitute and be but one and the same instrument.
Section 12. Trustee Not Liable for Investment Losses. The
Trustee shall not be liable for any loss resulting from any investment made
pursuant to this Agreement in compliance with the provisions hereof.
Section 13. Trustee May Rely on Signatures. The Trustee may
act in reliance upon any signature believed by it to be genuine and may assume
that any person purporting to give any notice or receipt of advice or make any
statement with respect to the provisions of this Agreement has been duly
authorized to do so. The Trustee shall not be liable for any mistake of fact or
error of judgment, or for any acts or omissions of any kind, unless caused by
its negligence or bad faith.
Section 14. Liability of Trustee. The Trustee shall not be
liable for any loss or damage, including counsel fees and expenses, resulting
from its actions or omissions to act hereunder, except for any loss or damage
arising out of its own bad faith, negligence or willful misconduct. Without
limiting the generality of the foregoing, the Trustee shall not be liable for
any action taken or omitted in reliance on any notice, direction, consent,
certificate, affidavit, statement, designation or other paper or document
reasonably believed by it to be genuine and to have been duly and properly
signed or presented to it by the Company.
Section 15. Indemnification. The Company shall indemnify and
exonerate, save and hold harmless the Trustee from and against any and all
claims, demands, expenses (including counsel fees and expenses) and liabilities
of any and every nature which the Trustee may sustain or incur or which may be
asserted against the Trustee as a result of any action taken or omitted by the
Trustee hereunder without bad faith, negligence or willful misconduct. At any
time, the Trustee may apply to the Company for written instructions with respect
to any matter
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arising under this Agreement and shall be fully protected in acting in
accordance with such instructions. In addition, the Trustee may, as reasonably
necessary, consult counsel to the Company or its own counsel, at the expense of
the Company, and shall be fully protected with respect to any action taken or
omitted in good faith in accordance with such advice or opinion of counsel to
the Company or its own counsel.
Section 16. Agents of Trustee. The Trustee may employ agents
or attorneys-in-fact, and shall not be liable for any loss or damage arising out
of, or in connection with, the actions or omissions to act of such agents or
attorneys-in-fact provided the Trustee acted without bad faith, negligence, or
willful misconduct in connection with the selection of such agents or
attorneys-in-fact.
IN WITNESS WHEREOF, the parties hereto have each caused this
Agreement to be executed by their duly authorized officers and their corporate
seals to be hereto affixed and attested as of the date first above written.
P.H. GLATFELTER COMPANY
[SEAL]
ATTEST: By
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Name:
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Title:
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Assistant Secretary
THE BANK OF NEW YORK
By
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Name:
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Title:
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Schedule A
U.S. GOVERNMENT OBLIGATIONS
United States Treasury Notes
Principal
Principal Interest Maturity
Amount Rate Date
