NOTE
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD,
UNLESS IT HAS BEEN REGISTERED UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE AND
THEN ONLY IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFER SET FORTH IN THE
SECURITIES PURCHASE AGREEMENT DATED AS OF NOVEMBER 25, 1998, A COPY OF
WHICH MAY BE OBTAINED FROM THE ISSUER OF THIS SECURITY AT ITS PRINCIPAL
EXECUTIVE OFFICE.
No. 1 $10,000,000.00
UNIDIGITAL INC.
Senior Subordinated Increasing Rate Note
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UNIDIGITAL INC., a Delaware corporation (together with its successors, the
"Company"), for value received hereby promises to pay to CIBC WOOD GUNDY CAPITAL
CORP. and registered assigns (the "Holder") the principal sum of TEN MILLION
DOLLARS by wire transfer of immediately available funds to the Holder's account
at such bank in the United States as may be specified in writing by the Holder
to the Company, on the Maturity Date in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts, and to pay interest on the unpaid principal
amount hereof on the dates and at the rate or rates provided for in the
Securities Purchase Agreement. Reference is made to the Securities Purchase
Agreement for provisions for the prepayment hereof and the acceleration of the
maturity hereof.
This Note is one of a duly authorized issue of Senior Subordinated
Increasing Rate Notes of the Company (the "Notes") referred to in the Securities
Purchase Agreement, dated as of November 25, 1998, among the Company, the
Guarantors named therein and the Purchaser named therein (as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
its terms, the "Securities Purchase Agreement"). The Notes are transferable and
assignable to one or more purchasers, in accordance with the limitations set
forth in the Securities Purchase Asgreement. The Company agrees to issue from
time to time replacement Notes in the form hereof to facilitate such transfers
and assignments.
The payment of the principal amount of the Notes, premium (if any) and
interest thereon, and any claim for rescission or damages in respect thereof
under any applicable law by the
Company is subordinated to the prior payment of Senior Debt to the extent and in
the manner provided in Article 9 of the Securities Purchase Agreement, and each
Holder of Notes, by his acceptance hereof, accepts and agrees to be bound by
such provisions.
The Company shall keep at its principal office a register (the "Register")
in which shall be entered the names and addresses of the registered holders of
the Notes and particulars of the respective Notes held by them and of all
transfers of such Notes. References to the "Holder" or "Holders" shall mean the
Person listed in the Register as the payee of any Note. The ownership of the
Notes shall be proven by the Register.
This Note shall be deemed to be a contract under the laws of the State of
New York, and for all purposes shall be construed in accordance with the laws of
said State. The parties hereto, including all guarantors or endorsers, hereby
waive presentment, demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance and enforcement of this
Note, except as specifically provided herein, and assent to extensions of the
time of payment, or forbearance or other indulgence without notice.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated: November 30, 1998
UNIDIGITAL INC.
By:/s/ William E. Dye
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Name: William E. Dye
Title: Chief Executive Officer
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