Pledge Agreement

Exhibit 4.7
PLEDGE AGREEMENT
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PLEDGE AGREEMENT, dated as of __________, 199_ (this "Agreement"), among Alco Standard Corporation, an Ohio corporation (the "Company"), ______________________ as collateral agent (in such capacity, together with its successors in such capacity, the "Collateral Agent"), and ___________________ ___________________, as purchase contract agent and as attorney-in-fact of the Holders (as hereinafter defined) from time to time of the Securities (as hereinafter defined) (in such capacity, together with its successors in such capacity, the "Purchase Contract Agent") under the Purchase Contract Agreement (as hereinafter defined).


RECITALS


The Company and the Purchase Contract Agent are parties to the Purchase Contract Agreement, dated as of the date hereof (as modified and supplemented and in effect from time to time, the "Purchase Contract Agreement"), pursuant to which there will be issued ____% Automatic Common Exchanged Securities (the "Securities").


Each Security consists of (a) one Purchase Contract (as hereinafter defined) and (b) __% United States Treasury Notes due ___________, 199_ ("Treasury Notes") having a principal amount equal to $__________ (the "Stated Amount") and maturing on __________, 1998 (the "Final Settlement Date"), subject to the pledge of such Treasury Notes created hereby.


Pursuant to the terms of the Purchase Contract Agreement and the Purchase Contracts, the Holders (as defined in the Purchase Contract Agreement) from time to time of the Securities have irrevocably authorized the Purchase Contract Agent, as attorney-in-fact of such Holders, among other things to execute and deliver this Agreement on behalf of such Holders and to grant the pledge provided hereby of the Treasury Notes constituting part of such Securities as provided herein and subject to the terms hereof.


Accordingly, the Company, the Collateral Agent and the Purchase Contract Agent, on its own behalf and as attorney-in-fact of the Holders from time to time of the Securities, agree as follows:


Section 1. Definitions. For all purposes of this Agreement, except
----------- as otherwise expressly provided or unless the context otherwise requires:


(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular; and


(2) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.


"Act" has the meaning specified in the Purchase Contract Agreement.


"Agreement" means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more agreements supplemental hereto entered into pursuant to the applicable provisions hereof.


"Applicable Treasury Regulations" means Subpart O-Book-Entry Procedure of Title 31 of the Code of Federal Regulations (31 CFR (S) 306.115 et. seq.) and any other regulations of the United States Treasury Department from time to time applicable to the transfer or pledge of book-entry U.S. Treasury Securities.


"Automatic Termination Event" has the meaning specified in the Purchase Contract Agreement.


"Board Resolution" has the meaning specified in the Purchase Contract Agreement.


"Business Day" means any day that is not a Saturday, a Sunday or a day on which the New York Stock Exchange or banking institutions or trust companies in The City of New York are authorized or obligated by law or executive order to be closed.


"Collateral Agent" has the meaning specified in the first paragraph of this instrument.


"Company" means the Person named as the "Company" in the first paragraph of this instrument until a successor shall have become such, and thereafter "Company" shall mean such successor.


"Early Settlement" has the meaning specified in the Purchase Contract Agreement.


"Early Settlement Amount" has the meaning specified in the Purchase Contract Agreement.


"Final Settlement Date" has the meaning specified in the Recitals.


"Holder" when used with respect to a Security, or a Purchase Contract constituting a part thereof, has the meaning specified in the Purchase Contract Agreement.


"Opinion of Counsel" has the meaning specified in the Purchase Contract Agreement.


"Optional Termination Event" has the meaning specified in the Purchase Contract Agreement.


"Outstanding Securities" has the meaning specified in the Purchase Contract Agreement.


"Outstanding Security Certificates" has the meaning specified in the Purchase Contract Agreement.


"Person" means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.


"Pledge" has the meaning specified in Section 2 hereof.


"Pledged Treasury Notes" has the meaning specified in Section 2 hereof.


"Purchase Contract" has the meaning specified in the Purchase Contract Agreement.


"Purchase Contract Agent" has the meaning specified in the first paragraph of this instrument.


"Security" has the meaning specified in the Recitals.


"Security Certificate" has the meaning specified in the Purchase Contract Agreement.


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"Stated Amount" has the meaning specified in the Recitals.


"Treasury Notes" has the meaning specified in the Recitals.


Section 2. The Pledge. The Holders from time to time of the
---------- Securities acting through the Purchase Contract Agent, as their attorney-in- fact, hereby pledge and grant to the Collateral Agent, as collateral security for the performance when due by such Holders of their respective obligations under the Purchase Contracts constituting part of such Securities, for the benefit of the Company, a security interest in all of the right, title and interest of such Holders in the Treasury Notes constituting a part of such Securities. Prior to or concurrently with the execution and delivery of this Agreement, the initial Holders and the Collateral Agent shall (i) cause the Treasury Notes to be delivered to the Collateral Agent by Federal Reserve Bank- Wire to the account of the Collateral Agent designated by it for such purpose and (ii) take appropriate action so that the applicable Federal Reserve Bank through which such Treasury Notes have been purchased will reflect such transfer and the Pledge by appropriate entries in its records in accordance with Applicable Treasury Regulations. In addition, the execution and delivery hereof by the Purchase Contract Agent and the Collateral Agent shall constitute (i) the notification to the Collateral Agent (as bailee or otherwise) of the Pledge and (ii) an acknowledgment by the Collateral Agent (as third party in possession or otherwise) of the Pledge and of its holding of such Treasury Notes subject to the Pledge, in each case, for purposes of perfecting the Pledge under Applicable Treasury Regulations and other applicable law, including, to the extent applicable, the Uniform Commercial Code as adopted and in effect in any applicable jurisdiction. The pledge provided in this Section 2 is herein referred to as the "Pledge" and the Treasury Notes subject to the Pledge, excluding any Treasury Notes released from the Pledge as provided in Section 4 hereof, are hereinafter referred to as the "Pledged Treasury Notes." Subject to the Pledge, the Holders from time to time of the Securities shall have full beneficial ownership of the Treasury Notes constituting a part of such Securities.


Section 3. Distribution of Principal and Interest. (a) All payments
-------------------------------------- of principal of, or interest on, any Treasury Notes constituting part of the Securities received by the Collateral Agent shall be paid by the Collateral Agent by wire transfer in same day funds no later than ____________, New York City time on the Business Day such interest payment is received by the Collateral Agent (provided that in the event such interest payment is received by the Collateral Agent on a day that is not a Business Day or after ____________, New York City time, on a Business Day, then such payment shall be made no later than ____________, New York City time, on the next succeeding Business Day) (i) in the case of (A) interest payments and (B) any principal payments with respect to any Treasury Notes that have been released from the Pledge pursuant to Section 4 hereof, to the Purchase Contract Agent to the account designated by it for such purpose and (ii) in the case of principal payments on any Pledged Treasury Notes, to the Company, in full satisfaction of the respective obligations of the Holders of the Securities of which such Pledged Treasury Notes are a part under the Purchase Contracts forming a part of such Securities. All such payments received by the Purchase Contract Agent as provided herein shall be applied by the Purchase Contract Agent pursuant to the provisions of the Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase Contract Agent shall receive any payments of principal on account of any Pledged Treasury Notes, the Purchase Contract Agent shall hold the same as trustee of an express trust for the benefit of the Company (and promptly deliver over to the Company) for application to the obligations of the Holders of the Securities of which such Treasury Notes are a part under the Purchase Contracts relating to the Securities of which such Treasury Notes are a part, and such Holders shall acquire no right, title or interest in any such payments of principal so received.


Section 4. Release of Pledged Treasury Notes.
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(a) Upon notice to the Collateral Agent by the Company or the Purchase Contract Agent that (i) there has occurred, an Automatic Termination Event, the Collateral Agent shall release all Pledged Treasury Notes from the Pledge and shall transfer all such Treasury Notes, free and clear of any lien, pledge or security interest created hereby, to the Purchase Contract Agent or (ii) one or more Holders of Securities have, upon the occurrence of an Optional Termination Event, elected to terminate the Purchase Contracts forming a part of such Securities in accordance with the terms of the Purchase Contract and the Purchase Contract Agreement and that all conditions to such termination have been satisfied, then the Collateral Agent shall release from the Pledge Pledged Treasury Notes with a principal amount equal to the product of (A) the


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Stated Amount times (B) the number of such Purchase Contracts as to which such
----- Holders have elected to such termination.


(b) Upon notice to the Collateral Agent by the Purchase Contract Agent that one or more Holders of Securities have elected to effect Early Settlement of their respective obligations under the Purchase Contracts forming a part of such Securities in accordance with the terms of the Purchase Contracts and the Purchase Contract Agreement, and that the Purchase Contract Agent has received from such Holders, and paid to the Company, the related Early Settlement Amounts pursuant to the terms of the Purchase Contracts and the Purchase Contract Agreement and that all conditions to such Early Settlement have been satisfied, then the Collateral Agent shall release from the Pledge Pledged Treasury Notes with a principal amount equal to the product of (i) the Stated Amount times (ii) the number of such Purchase Contracts as to which such
----- Holders have elected to effect Early Settlement.


(c) Transfers of Treasury Notes pursuant to Section 4(a) or (b) shall be by Federal Reserve Bank-Wire or in another appropriate manner, (i) if the Collateral Agent shall have received such notification at or prior to ____________, New York City time, on a Business Day, then no later than ____________, New York City time, on such Business Day and (ii) if the Collateral Agent shall have received such notification on a day that is not a Business Day or after ____________, New York City time, on a Business Day, then no later than ____________, New York City time, on the next succeeding Business Day.


Section 5. Rights and Remedies. (a) The Collateral Agent shall have
------------------- all of the rights and remedies with respect to the Pledged Treasury Notes of a secured party under the Uniform Commercial Code as in effect in the State of New York (the "Code") (whether or not said Code is in effect in the jurisdiction where the rights and remedies are asserted) and such additional rights and remedies to which a secured party is entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be a ...