Unassociated Document


     

    EXHIBIT
10.5

     

    
      REVOLVING
LINE NOTE

      (LIBOR
Advantage)

      


      
        	
                $1,000,000.00

              	
                February
      12, 2010

              


      

      


      FOR VALUE
RECEIVED, the undersigned, PREMIER PACKAGING CORPORATION, a New York
corporation, having a mailing address of 6 Framark Drive, Victor, New York 14564
(“Borrower”),
hereby promises to pay to the order of RBS  CITIZENS, N. A., a
national banking association (“Bank”), at its
principal office at 833 Broadway, Albany, New York 12207, or at such other place
as the holder hereof may from time to time designate in writing, the principal
sum of  ONE MILLION AND 00/100 DOLLARS U.S. ($1,000,000.00) or such
lesser amount as may be outstanding hereunder.

       

      1.           Certain
Definitions.  Unless otherwise expressly provided herein, all
capitalized terms in this Note shall have the meanings given to them in the
Credit Facility Agreement, dated on even date herewith, by and among Borrower
and Bank, as the same may be amended, extended, replaced, or modified from time
to time (the “Credit Agreement”).  The following terms shall have the
following meanings in this Note:

       

      (a)           “Business Day” means
any day which is neither a Saturday, Sunday nor a legal holiday on which
commercial banks are authorized or required to be closed in Rochester, New
York.

       

      (b)           “Event of Default”
means an Event Default under the Credit Agreement.

       

      (c)           “LA Interest Payment
Date” means, initially, the 1st day of March, 2010, and thereafter the
day of each succeeding month which numerically corresponds to such date or, if a
month does not contain a day that numerically corresponds to such date, the LA
Interest Payment Date shall be the last day of such month.

       

      (d)           “LA Interest Period”
means, with respect to any LIBOR Advantage Loan, the period commencing on (and
including) the date hereof  (the “Start Date”) and ending on (but
excluding) the date which numerically corresponds to such date one month later,
and thereafter, each one month period ending on the day of such month that
numerically corresponds to the Start Date.  If an Interest Period is
to end in a month for which there is no day which numerically corresponds to the
Start Date, the LA Interest Period will end on the last day of such
month.  Notwithstanding the date of commencement of any LA Interest
Period, interest shall only begin to accrue as of the date the initial LIBOR
Advantage Loan is made hereunder.

       

      (e)           “LA Margin” means
three and three-fourths percent (3.75%) per annum.

       

      (f)           “LIBOR Advantage
Loan” means any loan or advance for which the applicable rate of interest
is based upon the LIBOR Advantage Rate.

       

      
        
          
          

        

        
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      (g)           “LIBOR Advantage
Rate” means, relative to any LA Interest Period, the offered rate for
delivery in two London Banking Days of deposits of U.S. Dollars for a term
coextensive with the designated LA Interest Period which the British Bankers’
Association fixes as its LIBOR rate as of 11:00 a.m. London time on the day on
which such LA Interest Period commences.  If the first day of any
Interest Period is not a day which is both a (i) Business Day, and (ii) a London
Banking Day, the LIBOR Advantage Rate shall be determined by reference to the
next preceding day which is both a Business Day and a London Banking
Day.  If for any reason the LIBOR Advantage Rate is unavailable and/or
Bank is unable to determine the LIBOR Advantage Rate for any LA Interest Period,
Bank may, at its discretion, either: (a) select a replacement index based on the
arithmetic mean of the quotations, if any, of the interbank offered rate by
first class banks in London or New York for deposits with comparable maturities
or (b)  accrue interest at a rate per annum equal to Bank’s Prime Rate
as of the first day of any Interest Period for which the LIBOR Advantage Rate is
unavailable or cannot be determined.

       

      (h)           Loan Documents” means
this Note and all related documents and agreements evidencing and/or securing
the Loan including the Credit Agreement.

       

      (i)           “London Banking Day”
means any day on which dealings in US dollar deposits are transacted in the
London interbank market.

       

      (j)           “Maturity Date” means
the Revolving Line Termination Date, as defined in Article 2.2 of the Credit
Agreement.

       

      2.           Advances.

       

      (a)           Borrower
may request advances hereunder from time to time from Bank, and provided that no
Event of Default has occurred and further provided that advance requests are
received on or before the Maturity Date, Bank shall advance such funds to
Borrower so long as the aggregate principal amount outstanding at any time does
not exceed the lesser of (i) $1,000,000.00 and (ii) the Borrowing Base as
defined in Section 2.8 of the Credit Agreement.

       

      (b)           Bank
shall maintain a record of amounts of principal and interest payable by Borrower
from time to time, and the records of Bank maintained in the ordinary course of
business shall be prima facie evidence (absent manifest error by Bank) of the
existence and amounts of Borrower’s obligations recorded therein.  In
addition, Bank may mail or deliver periodic statements to Borrower indicating
the date and amount of each advance hereunder (but any failure to do so shall
not relieve Borrower of the obligation to repay any advance).  Unless
Borrower questions the accuracy of an entry on any periodic statement within 30
calendar days after such mailing or delivery by Bank, Borrower shall be deemed
to have accepted and be obligated by the terms of each such periodic statement
as accurately representing the advances hereunder.  In the event of
transfer of this Note, or if Bank shall otherwise deem it appropriate, Borrower
hereby authorizes Bank to endorse on this Note the amount of advances and
payments to reflect the principal balance outstanding from time to
time.  Bank is hereby authorized to honor borrowing and other requests
received from Philip Jones by telecopy or otherwise in writing.

       

      3.           Interest.

       

      (a)           Interest
on the outstanding principal amounts outstanding hereunder shall accrue during
the LA Interest Period at a rate per annum equal to the sum of the LIBOR
Advantage Rate for such LA Interest Period plus the LA
Margin.  Interest shall be due and payable on each LA Interest Payment
Date and on the Maturity Date.  Interest shall be calculated for the
actual number of days elapsed on the basis of a 360-day year, including the
first date of the applicable period to, but not including, the date of
repayment.

       

      
        
          
          

        

        
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      (b)           Interest
shall continue to accrue after maturity, acceleration, and judgment at the rate
required by Section 4.3 of the Credit Agreement until this Note is paid in
full.

       

      (c)           The
rate of interest on this Note may be increased under the circumstances provided
in the Credit Agreement.  The right of Bank to receive such increased
rate of interest shall not constitute a waiver of any other right or remedy of
Bank.

       

      4.           Payments.

       

      (a)           All
accrued interest hereunder shall be due and payable on each LA Interest Payment
Date.  All remaining accrued interest and all outstanding principal
shall be due and payable in full on the Maturity Date.

       

      (b)           In
the event Borrower becomes aware, or receives notice (oral or written) from
Bank, that principal amounts outstanding under the Revolving Line exceed the
maximum available amount hereunder, Borrower promptly shall make a principal
payment to Bank sufficient to reduce outstanding principal amounts to the
maximum amount available hereunder.

       

      5.           Prepayments.  Borrower
may prepay principal outstanding under this Note at any time without premium or
charge.  Borrower acknowledges that additional obligations may be
associated with prepayment in accordance with the terms and conditions of any
applicable Hedging Contracts.

       

      6.           Events of
Default.  This Note shall become immediately due and payable in
full, without further presentment, protest, notice, or demand, upon the
happening of any Event of Default.

       

      7.           Late
Charge.  This Note is subject to the late charges provided for
in Section 4.4 of the Credit Agreement.

       

      8.           Maximum
Rate.  All agreements between Borrower and Bank are hereby
expressly limited so that in no contingency or event whatsoever, whether by
reason of acceleration or maturity of the indebtedness evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to Bank for the use or the
forbearance of the indebtedness evidenced hereby exceed the maximum permissible
under Applicable Law (the “Maximum Interest
Rate”).  As used herein, the term “Applicable Law”
shall mean the law in effect as of the date hereof, provided, however that in
the event there is a change in the law which results in a higher permissible
rate of interest, then this Note and the Loan Documents shall be governed by
such new law as of its effective date.  In this regard, it is
expressly agreed that it is the intent of Borrower and Bank in the execution,
delivery and acceptance of this Note to contract in strict compliance with the
laws of the State of New York from time to time in effect.  If, under
or from any circumstances whatsoever, fulfillment of any provision hereof or of
any of the Loan Documents at the time performance of such provision shall be
due, shall involve transcending the limit of such validity prescribed by
applicable law, then the obligation to be fulfilled shall automatically be
reduced to the limits of such validity, and if under or from any circumstances
whatsoever Bank should ever receive as interest an amount which would exceed the
highest lawful rate, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced hereby and not to
the payment of interest.  This provision shall control every other
provision of all agreements between Borrower and Bank.

       

      
        
          
          

        

        
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      9.           Business
Days.  If this Note or any payment hereunder becomes due on a
day which is not a Business Day, the due date of this Note or payment shall be
extended to the next succeeding Business Day, and such extension of time shall
be included in computing interest and fees in connection with such
payment.

       

      10.           Entire
Agreement/Modification of Terms.  This Note and the Loan
Documents are intended by the parties as the final, complete, and exclusive
statement of the transactions evidenced by this Note and the Loan
Documents.  All prior or contemporaneous promises, agreements, and
understandings, whether oral or written, are deemed to be superseded by this
Note and the Loan Documents, and no party is relying on any promise, agreement,
or understanding not set forth in this Note and the Loan
Documents.  This Note and the Loan Documents may not be amended or
modified except by a written instrument describing such amendment or
modification executed by the Borrower and the Bank.  The terms of this
Note cannot be changed, nor may this Note be discharged in whole or in part,
except by a writing executed by Bank.  In the event that Bank demands
or accepts partial payments of this Note, such demand or acceptance shall not be
deemed to constitute a waiver of the right to demand the entire unpaid balance
of this Note at any time in accordance with the terms hereof.  Any
delay or omission by Bank in exercising any rights hereunder shall not operate
as a waiver of such rights.

       

      11.           Additional Security/Set
Off.  The Borrower hereby grants to Bank a continuing lien,
security interest, and right of set off as security for all liabilities and
obligations to the Bank, whether now existing or hereafter arising, upon and
against all deposits, credits, collateral and property, now or hereafter in the
possession, custody, safekeeping or control of Bank or any entity under the
control of Citizens Financial Group and its successors and assigns or in transit
to any of them.  At any time without demand or notice (any such notice
being expressly waived by Borrower), Bank may set off the same or any part
thereof and apply the same to any liability or obligation of Borrower even
though unmatured and regardless of the adequacy of any other collateral securing
the obligation.  ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS
RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE
OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SET OFF WITH RESPECT TO SUCH
DEPOSITS, CREDITS, OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY,
VOLUNTARILY, AND IRREVOCABLY WAIVED.

       

      12.           Assignment/Participation.

       

      (a)           All
the terms and provisions of this Note shall inure to the benefit of and be
binding upon and be enforceable by the parties and their respective successors
and assigns and shall inure to the benefit of and be enforceable by any holder
hereof.

       

      (b)           Bank
may at any time pledge or assign all or any portion of its rights under this
Note to any of the twelve (12) Federal Reserve Banks organized under Section 4
of the Federal Reserve Act, 12 U.S.C. Section 341.  No such pledge or
assignment or enforcement thereof shall release Bank from its obligations under
any of the Loan Documents.

       

      
        
          
          

        

        
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      (c)           Bank
shall have the unrestricted right at any time or from time to time, and without
Borrower’s consent, to assign all or any portion of its rights and obligations
hereunder to one or more banks or other financial institutions (each an “Assignee”), and
Borrower agrees that it shall execute, or cause to be executed, such documents,
including without limitation, amendments to this Note and to any other Loan
Documents, as Bank shall deem necessary to effect the foregoing.  In
addition, at the request of Bank and any such Assignee, Borrower shall issue one
or more new promissory notes, as applicable, to any such Assignee and, if Bank
has retained any of its rights and obligations hereunder following such
assignment, to Bank, which new promissory notes shall be issued in replacement
of, but not in discharge of, the liability evidenced by the promissory note held
by Bank prior to such assignment and shall reflect the amount of the respective
commitments and loans held by such Assignee and Bank after giving effect to such
assignment.  Upon the execution and delivery of appropriate assignment
documentation, amendments, and any other documentation required by Bank in
connection with such assignment, and the payment by Assignee of the purchase
price agreed to by Bank and such Assignee, such Assignee shall be a party to
this agreement and shall have all of the rights and obligations of Bank
hereunder (and under any and all other Loan Documents) to the extent that such
rights and obligations have been assigned by Bank pursuant to the assignment
documentation between Bank and such Assignee, and Bank shall be released from
its obligations hereunder and thereunder to a corresponding extent.

       

      (d)           Bank
shall have the unrestricted right at any time and from time to time, and without
the consent of or notice to Borrower, to grant to one or more banks or other
financial institutions (each a “Participant”)
participating interests in Bank’s obligation to lend hereunder and/or any or all
of the loans held by Bank hereunder.  In the event of any such grant
by Bank of a participating interest to Participant, whether or not upon notice
to Borrower, Bank shall remain responsible for the performance of its
obligations hereunder and Borrower shall continue to deal solely and directly
with Bank in connection with Bank’s rights and obligations
hereunder.

       

      (e)           Bank
may furnish any information concerning Borrower in its possession from time to
time to prospective Assignees and Participants, provided that Bank shall require
any such prospective Assignee or Participant to agree in writing to maintain the
confidentiality of such information.

       

      13.           Loss or
Mutilation.  Upon receipt of an affidavit of an officer of Bank
as to the loss, theft, destruction, or mutilation of this Note or any other Loan
Document which is not of public record, and, in the case of any such loss,
theft, destruction or mutilation, upon cancellation of this Note or other Loan
Document, Borrower will issue, in lieu thereof, a replacement note or other Loan
Document in the same principal amount thereof and otherwise of like
tenor.

       

      14.           Enforcement/Waiver of Jury
Trial.

       

      (a)           BORROWER
AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS NOTE OR ANY OF THE OTHER LOAN
DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL
COURT SITTING THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH
COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON BORROWER BY MAIL
AT THE ADDRESS FIRST SET FORTH ABOVE IN THIS NOTE.  BORROWER HEREBY
WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
FORUM.

       

      
        
          
          

        

        
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      (b)           BORROWER
AND BANK (BY ACCEPTANCE OF THIS NOTE) MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED
HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR ANY OTHER LOAN
DOCUMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING WITHOUT LIMITATION, ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF BANK RELATING TO
THE ADMINISTRATION OF THE LOAN OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE
THAT NEITHER PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER
ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.  EXCEPT
AS PROHIBITED BY LAW, BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL
DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES.  BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR
ATTORNEY OF BANK HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER.  THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR BANK TO
ACCEPT THIS AGREEMENT AND MAKE THE LOANS CONTEMPLATED HEREUNDER.

       

      15.           Miscellaneous.

       

      (a)           To
the fullest extent permissible by law, Borrower waives presentment, demand for
payment, protest, notice of nonpayment, and all other demands or notices
otherwise required by law in connection with the delivery, acceptance,
performance, default, or enforcement of this Note.  Borrower consents
to extensions, postponements, indulgences, amendments to notes and agreements,
substitutions or releases of collateral, and substitutions or releases of other
parties primarily or secondarily liable herefor, and agrees that none of the
same shall affect Borrower’s obligations under this Note which shall be
unconditional.

       

      (b)           This
Note and the Loan Documents are intended by the parties as the final, complete
and exclusive statement of the transactions evidenced by this Note and the Loan
Documents.  All prior or contemporaneous promises, agreements, and
understandings, whether oral or written, are deemed to be superseded by this
Note and the Loan Documents, and no party is relying on any promise, agreement,
or understanding not set forth in this Note and the Loan
Documents.  This Note may not be amended or modified except by a
written instrument describing such amendment or modification executed by the
Borrower and the Bank.

       

      
        
          
          

        

        
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      (c)           No
portion of the proceeds of this Note shall be used, in whole or in part, for the
purpose of purchasing or carrying any “margin stock” as such term is defined in
Regulation U of the Board of Governors of the Federal Reserve
System.

       

      (d)           This
Note and the Loan Documents, and the rights and obligations of the parties
hereunder, shall be construed, interpreted, governed and enforced in accordance
with the internal laws of the State of New York (excluding the laws applicable
to conflicts or choice of law).

       

       

      PREMIER
PACKAGING CORPORATION

       

       

      By:


        
          

        

      

      Name:

      Title:

      


      


      
        	
                STATE
      OF NEW YORK

              	
                )

              	 
      
	
                COUNTY
      OF MONROE

              	
                )

              	
                ss.:

              


      

      


      On the
____ day of February , in the year 2010, before me, the undersigned, a Notary
Public in and for said State, personally appeared personally known to me or
proved to me on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument and acknowledged to me that he/she
executed the same in his/her capacity, and that by his/her signature on the
instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.

       

       

       

      
        
          

        

      

      Notary
Public

       

       

       

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