Principal, Maturity and Interest
Mercer will issue up to $350,000,000 in aggregate principal amount of New Notes in this exchange offer. Mercer may issue
additional Notes under the Indenture from time to time after this exchange offer. Any issuance of additional Notes is subject to all of the covenants in the Indenture, including the covenant described below under the caption Certain
Covenants Incurrence of Indebtedness and Issuance of Preferred Stock. The New Notes offered hereby and any additional Notes subsequently issued under the Indenture will be treated as a single class for all purposes under the Indenture,
including, without limitation, with respect to waivers, amendments, redemptions and offers to purchase. Mercer will issue New Notes in denominations of $2,000 and integral multiples of $1,000 in excess of $2,000. The New Notes will mature on
January 15, 2025.
Interest on the New Notes will accrue at the rate of 7.375% per annum and will be payable
semi-annually in arrears on January 15 and July 15, commencing on July 15, 2019. Interest on overdue principal and interest and Additional Interest, if any, will accrue at a rate that is 1% higher than the then applicable interest
rate on the New Notes. Mercer will make each interest payment to the holders of record of the New Notes on the immediately preceding January 15 and July 15.
Interest on the New Notes will accrue from the date of original issuance or, if interest has already been paid, from the date
interest was most recently paid. Interest will be computed on the basis of a
360-day
year comprised of twelve
30-day
months.
If an interest payment date falls on a day that is not a business day, the interest payment to be made on such interest
payment date will be made on the next succeeding business day with the same force and effect as if made on such interest payment date, and no additional interest will accrue solely as a result of such delayed payment.
Methods of Receiving Payments on the New Notes
If a holder of New Notes has given wire transfer instructions to Mercer, Mercer will pay all principal, interest and premium
and Additional Interest, if any, on that holders New Notes in accordance with those instructions at the office or agency of the paying agent and registrar within Minneapolis, MN unless Mercer elects to make interest payments by check mailed to
the holders at their address set forth in the register of holders.
Paying Agent and Registrar for the New Notes
The trustee will initially act as paying agent and registrar. Mercer may change the paying agent or registrar without prior
notice to the holders of the New Notes, and Mercer or any of its Subsidiaries may act as paying agent or registrar.
Transfer and Exchange
A holder may transfer or exchange New Notes in accordance with the provisions of the Indenture. The registrar and the trustee
may require a holder, among other things, to furnish appropriate endorsements and transfer documents in connection with a transfer of New Notes. Holders will be required to pay all taxes due on transfer. Mercer will not be required to transfer or
exchange any New Note selected for redemption. Also, Mercer will not be required to transfer or exchange any New Note for a period of 15 days before a selection of New Notes to be redeemed. In connection with any proposed transfer of New Notes other
than those held in book entry form, Mercer or DTC shall be required to provide or cause to be provided to the trustee all information necessary to allow the trustee to comply with any applicable tax reporting obligations, including without
limitation any cost basis reporting obligations under Internal Revenue Code Section 6045. The trustee may rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
Optional Redemption
Except as otherwise described below, the New Notes will not be redeemable at Mercers option prior to January 15,
2021. Mercer is not, however, prohibited from acquiring the New Notes by means other than a redemption, whether pursuant to a tender offer, open market purchase or otherwise, so long as the acquisition does not violate the terms of the Indenture.
At any time prior to January 15, 2021, Mercer may on any one or more occasions redeem up to 35% of the aggregate
principal amount of New Notes issued under the Indenture at a redemption price of 107.375% of the principal amount, plus accrued and unpaid interest and Additional Interest, if any, to (but not including) the redemption date, with the net cash
proceeds of a sale of Equity Interests (other than Disqualified Stock) of Mercer;
provided
that:
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