The Offer is being made pursuant to an Offer to Purchase, dated as of June 18, 2014, and a related Letter of Transmittal, which more fully sets forth the terms and conditions of the Offer.

 

On June 26, 2013, Packaging Dynamics closed its acquisition of 100 percent of the issued and outstanding membership interests of Thilmany LLC, in an all cash transaction.  In accordance with the indenture governing the Notes, pursuant to a covenant titled "Limitation on Sales of Assets and Subsidiary Stock," the Offer to Purchase constitutes a Collateral Disposition Offer and an Asset Disposition Offer under the Asset Sale Covenant, and will be funded with the $64,912,000.00 of "Excess Collateral Proceeds" and "Excess Proceeds," which is required under the Indenture for any Excess Sale Proceeds that have not been applied to repay certain debt, fund certain asset acquisitions or make certain capital expenditures prior to the date that is 366 days following the closing of the Thilmany sale.

 

The Offer will remain open for a period of twenty business days, and will expire at 11:59 p.m., New York City time, on July 17, 2014, unless extended or earlier terminated by Packaging Dynamics (such date and time, as the same may be extended or earlier terminated. Holders who tender Notes on or prior to the Offer Expiration Date will be eligible to receive the Offer Consideration.  Tendered Notes may be withdrawn at any time on or prior to 11:59 p.m., New York City time, on July 17, 2014.  The Offer is subject to the satisfaction or waiver of certain conditions, as set for in the Offer to Purchase.

 

Holders who validly tender will receive offer consideration equal to $1,000 per $1,000 principal amount of the Notes tendered, plus accrued and unpaid interest on such Notes to the Settlement Date (as defined below), in accordance with the procedures set forth in the Indenture, provided that no Notes of $2,000 or less may be repurchased in part.  Interest will cease to accrue on all Notes purchased by the Company pursuant to the Offer. Subject to the terms and conditions of the Offer, each Holder that validly tenders Notes on or prior to the Offer Expiration Date will receive the Offer Consideration. The settlement date is the date of payment for the Notes accepted for purchase in the Offer, which will occur promptly following our acceptance for purchase of Notes validly tendered in the Offer.

 

Subject to the terms and conditions set forth in this Offer, the Company is offering to purchase an aggregate principal amount up $64,912,000 (the Tender Cap).  In no event will the aggregate principal amount of Notes purchased by the Company exceed the Tender Cap.  In the event that the aggregate principal amount of Notes that are validly tendered and not withdrawn prior to the Offer Expiration Date exceeds the Tender Cap, the Company (subject to the terms and conditions of the Offer) will purchase an amount of Notes up to the Tender Cap on a pro rata basis.  The Company will round the principal amount of the prorated Notes to be accepted down to the nearest $1,000.  In the event tendered Notes are not purchased due to proration or otherwise, they will be promptly returned or credited to the holder's account. 

 

Questions regarding the Offer may be directed to U.S. Bank National Association, as the Tender Agent:  111 Fillmore Avenue, St. Paul, MN 55107, Attn: Specialized Finance, Fax: (651) 466-7372.

 

 

Packaging Dynamics Corp.

(773) 843-8000

www.pkdy.com