GB PROPERTY FUNDING CORP.
CONSENT SOLICITATION STATEMENT
SOLICITATION OF CONSENTS FROM HOLDERS
OF 11% FIRST MORTGAGE NOTES DUE 2005
($110,000,000 PRINCIPAL AMOUNT OUTSTANDING)
CUSIP
(36149XAA1)
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THE SOLICITATION WILL EXPIRE AT 5:00 P.M., EASTERN TIME,
ON OCTOBER 8, 2001, UNLESS EXTENDED. THE COMPANY RESERVES
THE RIGHT TO EXTEND THE SOLICITATION AT ANY TIME AND FROM
TIME TO TIME, IN ITS SOLE AND ABSOLUTE DISCRETION. ANY SUCH EXTENSION SHALL BE
ANNOUNCED BY THE COMPANY THROUGH A PRESS
RELEASE.
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GB Property Funding Corp., a Delaware corporation (the "Company"), is
hereby soliciting, upon the terms and subject to the conditions set forth in
this Consent Solicitation Statement and in the related Consent Form, consents
(the "Solicitation") from the registered holders of the Company's 11% First
Mortgage Notes due 2005 (each a "Note" and collectively the "Notes"), to amend
certain provisions of that certain indenture (the "Original Indenture") dated as
of September 29, 2000 among the Company, GB Holdings, Inc. ("Holdings") and
Greate Bay Hotel and Casino, Inc. ("GBHC"), and Wells Fargo Bank Minnesota,
National Association as Trustee (the "Trustee"). The solicitation of proposed
amendments to the Original Indenture (the "Amendments") will continue through
5:00 p.m., Eastern Time on October 8, 2001, or such later date as may be set by
the Company in its sole and absolute discretion (the "Expiration Date"). The
term "Noteholder" as used herein means any person in whose name Notes were
registered in the register maintained by Wells Fargo Bank Minnesota, N.A., as
Trustee under the Original Indenture (the "Trustee"), as of September 11, 2001,
and, where applicable, includes participants of The Depository Trust Company or
its nominee.
A copy of a proposed Amended and Restated Indenture, which has been
marked to indicate the proposed Amendments to the Original Indenture, is
attached hereto as Annex A (as so amended, the "Proposed Amended Indenture"). In
Annex A, language proposed to be deleted from the Original Indenture is struck
through with a line and appears as follows: "{September 29, 2000}" and language
that is proposed to be added to the Original Indenture is highlighted and
appears as follows: "[Amended and Restated]". A copy of the Proposed Amended
Indenture, including all Amendments and without the markings, is attached hereto
as Annex B. A copy of the Original Indenture was filed by the Company on Form
8-K/A on October 2, 2000 with the Securities and Exchange Commission ("SEC") and
can be accessed electronically at the SEC's web site located at
http://www.sec.gov. A copy of the Proposed Amended Indenture was filed by the
Company on Form T-3 on August 29, 2001, as amended and such filing and all
amendments can be accessed at the SEC's web site.
The Company has not authorized any person to give any information or to
make any representation in connection with the Solicitation other than those
contained herein and, if given or made, such information or representation must
not be relied upon as having been authorized. Deliveries of Consents and
requests for assistance in filling out and delivering Consents or for additional
copies of this Consent Solicitation Statement or the Consent Letter should be
directed to the Company's agent for this Consent Solicitation (the "Agent")
Wells Fargo Bank Minnesota, N.A., Corporate Trust, N9303-120, Sixth & Marquette,
Minneapolis, Minnesota 55479, Attention: Ms. Jane Schweiger, Telephone: (612)
667-2344. CONSENT FORMS SHOULD BE DELIVERED ONLY TO THE AGENT. IN NO EVENT
SHOULD A HOLDER DELIVER NOTE CERTIFICATES. Notes will continue to be represented
by current certificates in the name of GB Property Funding Corp.
Capitalized terms used and not defined in this Consent Solicitation
Statement have the respective meanings assigned to them in the Proposed Amended
Indenture.
This Consent Solicitation Statement is dated September 14, 2001 and all
statements herein are made as of such date.
AVAILABLE INFORMATION
The Company is subject to the information requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and, in accordance
therewith, together with Holdings and GBHC, files reports and other information
with the SEC. Such reports and other information can be inspected and copied at
the public reference facilities of the Commission at Room 1024, Judiciary Plaza,
450 Fifth Street, N.W., Washington, DC 20549, and at the Commission's Regional
Offices at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material also can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Judiciary Plaza,
Washington, D.C. 20549, at prescribed rates. Such material may also be accessed
electronically at the SEC's site on the World Wide Web located at
http://www.sec.gov.
The Company filed a Form T-3 on August 29, 2001, as amended, and such
filing and all amendments can be accessed at the SEC's web site. The Form T-3
and the amendment thereto provide certain information regarding the Company and
the Proposed Amended Indenture and include a copy of the Proposed Amended
Indenture as an exhibit. Noteholders are urged to review the information
available through the public filings referred to above.
PURPOSE OF THE AMENDMENTS
The Solicitation is being made for the purpose of amending the Original
Indenture, dated as of September 29, 2000, among the Company, as issuer,
Holdings and GBHC, as guarantors, and Wells Fargo Bank Minnesota, N.A., as
Trustee, to, among other things, provide financial flexibility to the Company,
Holdings and GBHC. The Amendments would, among other things, allow the Company
to borrow additional money and grant liens to secure such indebtedness and
permit the release or subordination of the existing liens and mortgages that
secure the Notes. This would provide financial flexibility under the indenture
governing the Notes and facilitate potential improvements and expansion of the
Sands Hotel and Casino and the Company to, among other things, meet competition.
There can be no assurance that the Company, Holdings or GBHC will (i) determine
to proceed with any improvement or expansion or (ii) be able to obtain financing
on satisfactory terms to facilitate any improvement or expansion.
REQUIRED CONSENT
Under Section 902 of the Original Indenture, the consent of holders of
not less than a majority in principal amount of the Notes (the "Requisite
Consent") is required for the proposed Amendments to be approved.
THE AMENDMENTS
The Amendments, if approved, will be effected by means of an amended
and restated indenture that will amend and restate the Original Indenture. A
copy of a proposed amended and restated indenture, which has been marked to
indicate the proposed Amendments to the Original Indenture, is attached hereto
as Annex A (as so amended, the "Proposed Amended Indenture"). In Annex A,
language proposed to be deleted from the Original Indenture is struck through
with a line and appears as follows: "{September 29, 2000}" and language that is
proposed to be added to the Original Indenture is highlighted and appears as
follows: "[Amended and Restated]". A copy of the Proposed Amended Indenture,
including all Amendments and without the markings, is attached hereto as Annex
B. A copy of the Original Indenture was filed by the Company on Form 8-K/A on
October 2, 2000 with the Securities and Exchange Commission ("SEC") and can be
accessed electronically at the SEC's web site located at http://www.sec.gov. A
copy of the Proposed Amended Indenture was filed by the Company on Form T-3 on
August 29, 2001 with the SEC, as amended, and such filing and amendments can
also be accessed electronically at the SEC's web site.
SET FORTH BELOW IS A DESCRIPTION OF THE PROPOSED AMENDMENTS FOR WHICH
THE CONSENTS OF THE REGISTERED HOLDERS OF NOTES ARE BEING SOLICITED. SUCH
DESCRIPTION IS A SUMMARY OF THE MATERIAL AMENDMENTS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO THE FULL PROVISIONS OF THE PROPOSED AMENDED INDENTURE,
WHICH HAS BEEN MARKED TO SHOW CHANGES AGAINST THE ORIGINAL INDENTURE AND
INCLUDED AS ANNEX A HERETO. NOTEHOLDERS ARE URGED TO REVIEW THE PROPOSED AMENDED
INDENTURE IN ITS ENTIRETY.
Limitation on Indebtedness.
Section 1011 of the Original Indenture generally restricts Holdings
from incurring Indebtedness other than certain Allowed Indebtedness, Working
Capital Indebtedness and Indebtedness incurred to refinance Indebtedness
otherwise permitted by Section 1011. The Amendments would delete Section 1011 in
its entirety.
Section 1012 of the Original Indenture generally restricts Holdings
from permitting any Subsidiary from incurring Indebtedness or issuing certain
Preferred Stock other than certain Permitted GBHC Indebtedness, Allowed
Indebtedness, Working Capital Indebtedness and Indebtedness incurred to
refinance indebtedness otherwise permitted by Section 1012. The Amendments would
delete Section 1012 in its entirety.
These modifications would permit Holdings and its Subsidiaries to incur
any additional Indebtedness without restriction and to issue any Preferred Stock
without restriction.
Limitation on Restricted Payments.
Section 1013 of the Original Indenture generally restricts Holdings
from making, and permitting any Subsidiary to make, Restricted Payments unless
certain financial performance criteria are met. Under the Original Indenture
Restricted Payments include dividends, redemptions or other distributions in
respect of capital stock and the prepayment of certain Indebtedness. The
Amendments would modify the definition of Restricted Payments so that the
restrictions of Section 1013 would not apply to Preferred Stock or Indebtedness.
This modification would allow Holdings and its Subsidiaries to make
distributions in respect of Preferred Stock and to pay or prepay Indebtedness
without restriction.
Limitation on Liens.
Section 1014 of the Original Indenture generally restricts Holdings
from incurring, and permitting any Subsidiary to incur, any Lien upon its
property or assets other than certain Permitted Liens, Liens existing on the
Issue Date of the Notes and certain other liens that are exceptions to the
restriction. The Amendments would delete Section 1014 in its entirety.
Section 1015 of the Original Indenture generally restricts the Company
from incurring any Lien upon its property or assets. The Amendments would delete
Section 1015 in its entirety.
The ability of the Company to incur Permitted Liens has been preserved
in Section 1405(e) of the Proposed Amended Indenture. Section 1405(e) has also
been added to make clear that the deletion of the references to Permitted Liens
that would occur by deleting Sections 1014 and 1015 from the Original Indenture
is not intended to prevent the incurrence of Permitted Liens. Rather, when taken
together with the other Amendments, particularly those in Sections 1405(a) and
1405(b) discussed below under "Release and Subordination of Liens", the
modifications in Sections 1014 and 1015 would permit Holdings and its
Subsidiaries to incur any Liens without restriction including, but not limited
to, Permitted Liens.
Limitation on Sale Leaseback Transactions.
Section 1016 of the Original Indenture generally restricts Holdings and
its Subsidiaries from entering into, and permitting any Subsidiary to enter
into, any Sale Leaseback Transaction subject to certain exceptions specified
therein. The Amendments would delete Section 1016 in its entirety.
This modification would permit Holdings and its Subsidiaries to enter
into Sale Leaseback Transactions without restriction.
Asset Sale Definition and Section 1017.
Section 1017 of the Original Indenture generally restricts Holdings and
each of its Subsidiaries from making "Asset Sales" of Collateral unless Fair
Market Value is received, consideration for such sale is paid 85% in cash and,
in certain circumstances, the Net Cash Proceeds of such sale are made available
to Noteholders through an offer to purchase outstanding Notes at a purchase
price equal to 100% of the principal amount thereof plus accrued and unpaid
interest, if any. The Amendments would modify the definition of "Asset Sale"
contained in Section 101 of the Original Indenture to exclude the following from
the definition of Asset Sale (in addition to those items already excluded in the
definition of Asset Sale in the Original Indenture): (i) Sale Leaseback
Transactions, (ii) conveyances or contributions to any entity in which Holdings
or its Subsidiaries has or obtains equity or debt interests and (iii)
transactions (including the granting of liens) made in accordance with the
collateral release and subordination provisions of Section 1405 of the Proposed
Amended Indenture, or any documents entered into in connection with any Approved
Project (such as the incurrence of Indebtedness or the transfer of assets to any
person if Holdings or any of its subsidiaries has or obtains debt or equity
interests in the transferee) in respect of which a release or subordination has
occurred in accordance with the provisions of Section 1405 of the Proposed
Amended Indenture, including, without limitation, any sale or other disposition
resulting from any default or foreclosure.
This modification to the Original Indenture would permit Holdings and
its subsidiaries to engage in the transactions excluded from the definition of
"Asset Sale" including permitting Holdings and its Subsidiaries to contribute
assets to entities in which Holdings or its Subsidiaries has or obtains equity
or debt interests or to engage in Sale Leaseback Transactions without being
required to comply with Section 1017, including, without limitation, without any
obligation to receive 85% of the transfer proceeds in cash or to offer to
purchase Notes. This modification would also permit a sale or transfer of assets
in connection with any default or foreclosure under documents relating to any
Approved Project, in respect of which a release or subordination has occurred in
accordance with the provision of Section 1405 of the Proposed Amended Indenture
without any obligation to comply with Section 1017, including, without
limitation, any obligation to receive 85% of the transfer proceeds in cash or to
offer to purchase Notes.
The Amendments would also modify Section 1017 to make the provisions
thereof subject to the terms of the Proposed Amended Indenture, and the terms of
any release or subordination contemplated in Section 1405 of the Proposed
Amended Indenture. This modification to the Original Indenture would permit
Holdings and its Subsidiaries to exclude from the applicability of Section 1017
any assets and any proceeds thereof that have been the subject of a release or
subordination contemplated in Section 1405 of the Proposed Amended Indenture.
Section 1017 is also affected by the addition of Section 1405(f) to the
Proposed Amended Indenture. (See "Section 1405(f)" below).
Section 1018.
Section 1018 of the Original Indenture generally requires that in the
event that Holdings or any subsidiary suffers an event of loss to any
Collateral, the Company shall, in certain circumstances, use all of the Net Cash
Proceeds to offer to purchase outstanding Notes at a purchase price equal to
100% of the principal amount thereof plus accrued and unpaid interest, if any.
The Amendments would modify Section 1018 to make those provisions subject to the
terms of the Proposed Amended Indenture, and the terms of any release or
subordination contemplated in Section 1405 of the Proposed Amended Indenture.
This modification to the Original Indenture would permit Holdings and
its Subsidiaries to exclude from the applicability of Section 1018, including,
without limitation, any obligation to offer to purchase Notes, any assets and
any proceeds thereof that have been the subject of a release or subordination
contemplated in Section 1405 of the Proposed Amended Indenture.
Section 1018 is also affected by the addition of Section 1405(f) to the
Proposed Amended Indenture. (See "Section 1405(f)" below).
CRDA Investments.
Section 1023 of the Original Indenture generally restricts Holdings and
its Subsidiaries from, among other things, selling or otherwise conveying any of
its investments in securities issued by, and monies deposited with, the Casino
Reinvestments Development Authority of the State of New Jersey ("CRDA
Investments") other than for fair value. The Amendments would add language to
permit such sales or conveyances if they were made in accordance with the terms
of any security interests granted in CRDA Investments. This modification to the
Original Indenture would permit the sale or other conveyance of CRDA Investments
in accordance with the terms of a permitted security interest, whether or not
such sale was made at fair value.
Collateral Account.
Section 1404 of the Original Indenture generally requires that all of
the Net Cash Proceeds of any Asset Sale pursuant to Section 1017 that involves a
sale of Collateral or any Event of Loss that involves a loss of Collateral be
deposited into the Collateral Account. Section 1404 further provides that any
such proceeds may be released from the Collateral Account only to: (x) pay the
principal amount of Notes tendered pursuant to an Asset Sale Offer or Event of
Loss Offer; or (y) make a Permitted Related Investment. The Amendments would
modify Section 1404 to make those provisions subject to the terms of the
Proposed Amended Indenture and the terms of any release or subordination
contemplated in Section 1405 of the Proposed Amended Indenture.
This modification to the Original Indenture would permit Holdings and
its Subsidiaries to exclude from the applicability of Section 1404 any assets
(and any proceeds thereof) that have been subject to a release or subordination
as contemplated in Section 1405 of the Proposed Amended Indenture.
Section 1404 is also affected by the addition of Section 1405(f) to the
Proposed Amended Indenture (See "Section 1405 (f) below).
Release and Subordination of Liens.
The Amendments would add Section 1405(a) and (b) to the Proposed
Amended Indenture. Section 1405(a) and (b) indicate that, in connection with, in
anticipation of, as a result of or in relation to, an Approved Project (such as
the incurrence of Indebtedness or the transfer of assets to any person if
Holdings or its Subsidiaries has or obtains debt or equity interests in the
transferee) and at the request of Holdings or a Subsidiary and upon the delivery
of certain documents, certificates and legal opinions, the Trustee will execute
and deliver documents necessary to release the security interests of the Trustee
under the indenture and the related security documents, or subordinate such
security interests, to other liens to be granted on such assets, and in
connection therewith, to release the liens of the Trustee of record and
terminate the security documents.
These modifications to the Original Indenture would permit Holdings and
its Subsidiaries to eliminate the security interest of the Trustee in all or any
portion of the assets of Holdings and its Subsidiaries or to subordinate that
security interest to liens to be granted to others. If such security interest
was eliminated then the Notes would cease to be secured obligations and the
holders of the Notes would become general unsecured creditors of Holdings and
its Subsidiaries. If such security interest was subordinated, then the security
interest securing the Notes would be junior to the liens in respect of which
such subordination had been granted and the holders of such senior liens would
have a claim with respect to such assets superior to that of the holders of the
Notes.
Section 1405(f)
The Amendments would add Section 1405(f) to the Proposed Amended
Indenture. Section 1405(f) indicates that, to the extent contemplated in the
documents relating to a release or subordination permitted in Section 1405 of
the Proposed Amended Indenture, the terms of Sections 1017 and 1018 and of
related Section 1404 will cease to apply, or be restricted in their application
to, those assets that are subject to any such release or subordination. The
modifications to Sections 1017, 1018, and 1404 and to the definition of "Asset
Sale" and the addition of Section 1405(f), would permit Holdings and its
Subsidiaries to engage in transactions that would eliminate assets selected by
Holdings and its Subsidiaries (and any proceeds thereof) from the requirements
of Sections 1017 and 1018 and related Section 1404 of the Original Indenture.
Definitions.
Various terms set forth in the definitions in Section 101 of the
Original Indenture have been modified and additional terms have been added. In
particular, these changes include but are not limited to:
(i) in Section 101(d) the Amendments would make it clear that: (x) the
security interests granted to the Trustee as contemplated in the
Original Indenture and the related security documents, would be subject
to any release or subordination contemplated in Section 1405 of the
Proposed Amended Indenture; and (y) any reference in the Proposed
Amended Indenture to the "terms of any release or subordination
contemplated in Section 1405 hereof" or "any release or subordination"
or words of similar import shall be deemed to refer to and include,
without limitation, any and all terms, provisions and conditions of any
such release or subordination and of all agreements, documents and
instruments related thereto, associated therewith or arising from or in
connection with any such release or subordination or any related or
associated transaction.
(ii) the term "Collateral" has been modified to make it clear that the
term does not include assets that have ceased to be subject to the
security interests in favor of the Trustee pursuant to Section 1405 of
the Proposed Amended Indenture.
(iii) the term "Collateral Proceeds" has been modified to make it clear
that such proceeds do not include those arising from assets of Holdings
or its Subsidiaries to the extent set forth in any documents relating
to any release or subordination contemplated in Section 1405 of the
Proposed Amended Indenture.
Additional Matters
The foregoing constitutes a discussion of the Amendments to the
Original Indenture which the Company believes are material. Additional
Amendments are reflected in Annex A, many of which further implement the
Amendments discussed above or otherwise modify the Original Indenture.
NOTEHOLDERS ARE URGED TO REVIEW THE PROPOSED AMENDED INDENTURE IN ITS ENTIRETY.
THE SOLICITATION
Terms of the Solicitation; Consent Payment
The Company has fixed the close of business on September 11, 2001 as
the record date (the "Record Date") for holders of Notes ("Noteholders")
entitled to consent to the Amendments. The Solicitation is made only to persons
that were Noteholders as of the Record Date. A Noteholder who delivers a
properly completed and executed Consent in favor of the Amendments on or prior
to the Expiration Date (such Noteholders are referred to collectively as
"Consenting Noteholders") and does not thereafter timely revoke such Consent
will be entitled to receive the Consent Fee if the Requisite Consent is granted
in favor of the Amendments (and not revoked) and the other conditions of the
Solicitation are satisfied (see "The Solicitation - Conditions" below), even if
the Noteholder thereafter transfers the Notes to another person, unless such
transferor also duly transfers its right to execute a Consent to the transferee
and the transferee timely revokes such Consent. See "The Solicitation -
Revocation of Consents" below. Consents, once they become effective, will be
binding on any transferee(s) whether or not any notation with respect to the
Consent is made on the Notes transferred. A transferee Noteholder who wishes to
deliver or revoke a Consent with respect to a Note as to which he is not the
Noteholder of record on the Record Date or a beneficial holder that desires to
deliver or revoke a Consent, must obtain a proxy in the form of Annex C hereto
or otherwise acceptable to the Company from the Noteholder on the Record Date.
It is anticipated that The Depository Trust Company or its nominee ("DTC") will
authorize DTC participants to execute Consents in respect of Notes of which DTC
is the registered holder as of the Record Date. The Consent Fee will only be
paid to record holders of Notes on the Record Date or, in accordance with
directions received by the Company or the Agent from DTC, to DTC participants
that properly complete the "Special Payment Instructions" included in the
Consent Form.
Noteholders who do not timely deliver a Consent will receive no Consent
Fee even though the Amendments, if they are approved and become effective, will
be binding on them. The payment of the Consent Fee is subject to the
satisfaction of the terms and conditions of the Solicitation (See "The
Solicitation - Conditions" below).
The Solicitation is scheduled to expire at 5:00 p.m., Eastern Time, on
October 8, 2001. However, the Company reserves the right to extend the
Solicitation at any time and from time to time, in its sole and absolute
discretion. Any such extension shall be announced by the Company through a press
release, a copy of which will be delivered to the Agent. The failure of a
Noteholder to deliver a Consent will have the same effect as if such Noteholder
had voted "Against" the Amendments.
Subject to the conditions contained herein, the Consent Fee will be
paid by check to Consenting Noteholders. No interest will accrue on any Consent
Fee due to Consenting Noteholders.
As of the date hereof, entities affiliated with Carl C. Icahn
collectively hold in the aggregate approximately 58% of the Notes outstanding.
Mr. Icahn has indicated that he anticipates that the Icahn Entities will vote in
favor of the Amendments.
Conditions
The payment of the Consent Fee is subject to the occurrence of the
following in a manner satisfactory to the Company, Holdings and GBHC in their
sole and absolute discretion:
i. the Requisite Consent must be obtained and not revoked;
ii. the Proposed Amended Indenture must be qualified under the Trust
Indenture Act of 1939, as amended, and such qualification must
remain in full force and effect; and
iii. the Proposed Amended Indenture must be executed by each of the Company,
Holdings, GBHC and the Trustee.
The Company may, at any time prior to the execution of the Proposed
Amended Indenture determine in its sole discretion not to proceed with the
Solicitation or complete the Amendments, in which case the Original Indenture
would not be amended and no Consent Fee would be paid.
Amendments to Solicitation
The Company may, in its sole and absolute discretion, amend or
supplement the terms of the Solicitation. Any such amendment will be announced
by a press release.
Procedures for Consent
Noteholders wishing to consent to the Amendments must complete, sign
and date the accompanying Consent Form in accordance with the instructions
contained therein and mail or deliver by hand such Consent and any other
required documentation to the Agent, so that it is received by the Agent on or
before the Expiration Date.
The method of delivering Consents is at the election and risk of the
Noteholder, but the Company suggests that any mail delivery be made far enough
in advance of October 8, 2001 to permit timely delivery to the Agent. Delivery
will be effective only upon actual receipt by the Agent. Consents also may be
delivered by hand to the Agent at its address set forth herein. Consents may be
delivered via facsimile, but must be followed by an executed original which must
be delivered to the Agent not more than 6 business days following the Expiration
Date.
Any beneficial owner whose Notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who wishes
to deliver a Consent must contact such registered Noteholder promptly and
instruct such registered Noteholder to deliver such Consent on his or her
behalf. It is anticipated that DTC will authorize DTC participants to execute
Consents in respect of Notes of which DTC is the registered holder as of the
Record Date.
All Consents that are properly completed, signed and delivered to the
Agent prior to the Expiration Date and not revoked will be given effect in
accordance with the specifications thereof. If none of the boxes on the Consent
Form are marked, but the Consent Letter is otherwise properly completed and
signed, the Noteholder will be deemed to have consented to the Amendments in
respect of all Notes held by such Noteholder (or in the case of a DTC
participant, all Notes in respect of which it is a DTC participant) as of the
Record Date.
Consents by the Noteholders as of the Record Date must be executed in
exactly the same manner as such Noteholder's name appears on the Notes. If Notes
to which a Consent relates are held of record by two or more joint Noteholders,
all such Noteholders must sign the Consent. If a Consent is signed by a trustee,
partner, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person must so indicate when signing and must submit with the Consent Form
appropriate evidence of authority to execute the Consent satisfactory to the
Agent. In addition, if a Consent relates to less than the total principal amount
of Notes registered in the name of such Noteholder, the Noteholder must list the
serial numbers and principal amount of Notes registered in the name of such
Noteholder to which the Consent relates. If Notes are registered in different
names, separate Consents must be executed covering each form of registration.
The ownership of registered Notes shall be proved in accordance with
the terms of the Original Indenture. The Company may require such additional
proof of execution or ownership as it deems necessary. All questions as to the
validity, form, eligibility (including time of receipt), revocations and
acceptance of Consents, and entitlement to the Consent Fee, will be resolved by
the Company. The Company reserves the absolute right to reject any or all
Consents, revocations of Consents or proxies that are not in proper form or are
otherwise unacceptable or the acceptance of which could, in the opinion of the
Company or its counsel, be unlawful.
The Company also reserves the right to waive any irregularities or
conditions of delivery as to any particular Consent. The Company's
interpretation of the terms and conditions of the Solicitation (including the
instructions in the Consent) will be final and binding. Unless waived, any
irregularities in connection with deliveries must be cured within such time as
the Company determines. The Company and the Agent will be under no duty to give
notification of any such irregularities or waiver and will incur no liability
for failure to give such notification. Deliveries of Consents as to which
irregularities exist will not be deemed to have been made until such
irregularities have been cured or waived. However, the Company may, in its
discretion, accept such cures or grant such waivers after the Expiration Date.
Effect of Consents
BY GRANTING ITS CONSENT, A NOTEHOLDER IS AND SHALL BE DEEMED TO BE CONSENTING TO
(I) ALL OF THE MODIFICATIONS TO THE ORIGINAL INDENTURE THAT ARE REFLECTED IN
ANNEX A AND (II) THE ENTRY BY THE COMPANY, HOLDINGS, GBHC AND THE TRUSTEE INTO
AN AMENDED AND RESTATED INDENTURE SUBSTANTIALLY IN THE FORM OF ANNEX B TO THE
CONSENT SOLICITATION STATEMENT, WITH SUCH ADDITIONS AND DELETIONS AS SHALL BE
APPROPRIATE TO CARRY OUT THE INTENT OF OR ARE CONSISTENT WITH THE AMENDMENTS, OR
DO NOT VARY THE SUBSTANCE OF THE PROPOSED AMENDED INDENTURE. IN ADDITION, THE
NOTEHOLDER IS AND SHALL BE DEEMED TO BE AGREEING AND ACKNOWLEDGING THAT BY
GRANTING ITS CONSENT IT APPROVES OF THE AMENDMENTS AND THE PROPOSED AMENDED
INDENTURE, THE EXECUTION AND DELIVERY THEREOF, THE CONSENT FEE, THE ADOPTION AND
IMPLEMENTATION THEREOF AND ALL RELATED MATTERS AND WAIVES AND RELEASES ANY
OBJECTIONS, CLAIMS AND CAUSES OF ACTION IN RESPECT THEREOF OR RELATED THERETO
AGAINST ANY OF THE COMPANY, HOLDINGS, GBHC AND THEIR RESPECTIVE OFFICERS,
EMPLOYEES, ATTORNEYS, ADVISORS, DIRECTORS AND AFFILIATES.
Revocation of Consents
Consents may be revoked at any time prior to 5:00 P.M. Eastern Time on
the day immediately prior to the day on which the Proposed Amended Indenture is
executed by the Company, Holdings, GBHC and the Trustee. To revoke a Consent, a
written notice of revocation must be timely received by the Agent prior to such
time at its address set forth below. Notice of revocation of a Consent must
contain the description of the Notes to which it relates (including the
certification number or numbers and principal amount of such Notes) and be
signed by the Noteholder in the same manner as the Consent by which such
Noteholder consented. Any Consent so revoked will be deemed not to have been
validly given for the purposes of the Solicitation and no Consent Fee will be
made with respect thereto unless another Consent is executed and delivered prior
to the Expiration Date and not likewise revoked.
Each Consent Form and revocation of Consent should be sent to the
Agent, as follows:
Hand Delivery US Mail or Overnight Courier
------------- ----------------------------
Wells Fargo Bank Minnesota, N. A. Wells Fargo Bank Minnesota, N. A.
Corporate Trust Corporate Trust
12th Floor - Northstar East Building N9303-120
608 2nd Avenue South Sixth & Marquette
Minneapolis, Minnesota 55402 Minneapolis, Minnesota 55479
Attention: Ms. Jane Schweiger
Telephone: (612) 667-2344
Facsimile: (612) 667-9825
PERSONS WHO DESIRE TO FURNISH THEIR CONSENT SHOULD MAIL, HAND DELIVER,
SEND BY OVERNIGHT COURIER COMPLETED AND EXECUTED CONSENT FORMS TOGETHER WITH ALL
OTHER REQUIRED DOCUMENTS TO THE AGENT IN ACCORDANCE WITH THE INSTRUCTIONS SET
FORTH HEREIN AND THEREIN.
IN NO EVENT SHOULD A HOLDER TENDER OR DELIVER ANY SECURITIES TO THE
COMPANY, OR THE AGENT WITH THEIR CONSENT FORMS OR OTHERWISE.
Information; Assistance; Additional Materials
Questions relating to the procedure for delivering Consent Forms, as
well as requests for assistance or for additional copies of this Consent
Solicitation Statement or the Consent Form, should be directed to the Agent at
the address set forth above. Questions relating to the Consent Solicitation
Statement should be directed to the Company by calling Frederick Kraus, General
Counsel, at (609) 441-4517.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
THE FOLLOWING IS A SUMMARY DISCUSSION OF CERTAIN OF THE ANTICIPATED
U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE AMENDMENTS AND THE CONSENT FEE. THIS
SUMMARY IS BASED UPON THE RELEVANT PROVISIONS OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), AND RELATED REGULATIONS, REVENUE RULINGS AND
DECISIONS NOW IN EFFECT, ALL OF WHICH ARE SUBJECT TO CHANGE. THIS SUMMARY DOES
NOT ATTEMPT TO ADDRESS THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF ALL
CATEGORIES OF HOLDERS OF NOTES, SOME OF WHICH MAY BE SUBJECT TO SPECIAL RULES
(E.G., LIFE INSURANCE COMPANIES, TAX-EXEMPT ENTITIES AND FOREIGN TAXPAYERS). NO
RULING HAS BEEN OR WILL BE SOUGHT FROM THE INTERNAL REVENUE SERVICE (THE
"SERVICE") REGARDING ANY MATTER DISCUSSED BELOW. ACCORDINGLY, NO ASSURANCE CAN
BE GIVEN THAT THE SERVICE WILL NOT CHALLENGE ANY OF THE FEDERAL INCOME TAX
CONSEQUENCES DESCRIBED BELOW OR THAT ANY SUCH CHALLENGE, IF MADE, WOULD NOT BE
SUSTAINED BY A COURT. ALL HOLDERS OF NOTES ARE URGED TO CONSULT WITH THEIR OWN
TAX ADVISERS IN DETERMINING THE FEDERAL, STATE, LOCAL AND ANY OTHER TAX
CONSEQUENCES OF THE AMENDMENTS AND THE CONSENT FEE.
The Amendments and the Consent Fee
The Company believes that the only federal income tax consequence of
the adoption of the Amendments to holders of Notes will be that the full amount
of the Consent Fee will be subject to tax as ordinary income to those holders
who receive it. This conclusion is based upon the view that such adoption will
not be treated as a constructive exchange of the Notes for new Notes.
Alternatively, even if the adoption of the Amendments were treated as an
exchange by the Service, any such exchange may be a tax-free exchange under
Section 368 of the Code.
If the adoption of the Amendments were considered to be a constructive
exchange of the Notes for new securities for federal income tax purposes and
such exchange did not qualify for tax-free treatment under Section 368 of the
Code, holders would recognize gain or loss upon such deemed exchange, equal to
the difference between (i) the issue price of the Notes deemed received in
exchange for the old securities (or possibly the sum of such issue price and the
amount of the Consent Fee received) less (ii) the adjusted basis of the Notes
deemed surrendered. Any gain or loss recognized on the deemed exchange would
generally be capital gain or loss if the Notes were held by a holder as a
capital asset (and long-term capital loss if the holder of the Notes held the
Notes for more than one year at the time of such deemed exchange) except to the
extent of any accrued but unrecognized market discount, which would be treated
as ordinary income to the extent of any gain. If the issue price of the new
Notes is less than the principal amount thereof, then such new Notes may be
treated as issued with original issue discount, which the holder would generally
include in income as it accrues on a constant yield basis over the remaining
term of the new Notes.
Withholding
Under the U.S. federal income tax laws, a holder of Notes may, under
certain circumstances, be subject to backup withholding at the rate of 30.5%
with respect to the Consent Fee, unless such holder (i) is a corporation or is
otherwise exempt and, when required, demonstrates this fact or (ii) provides a
correct taxpayer identification number, certifies as to no loss of exemption
from backup withholding and otherwise complies with applicable requirements of
the backup withholding rules. See the instructions with respect to backup
withholding for U.S. holders of Notes contained in the accompanying Consent
Form. Backup withholding and information reporting will not apply to a Consent
Fee made to a non-U.S. holder of Notes provided such holder certifies on federal
Form W-8 BEN as to its non-U.S. holder status under penalties of perjury or
otherwise establishes an exemption (provided that we have no actual knowledge
that the holder is a U.S. person or that the conditions of any other exemptions
are not in fact satisfied). With respect to non-U.S. holders of Notes, the
Company intends to withhold tax at a rate of 30% of the Consent Fee in
accordance with federal income tax law unless the rate is reduced by applicable
treaty.
Other Tax Considerations
There may be other U.S. federal, state, local or foreign tax
considerations applicable to the circumstances of a holder of a Note.
Accordingly, all holders of Notes should consult with their own tax advisers as
to any particular tax consequences to them of the Amendments and the Consent
Fee.
THE PRECEDING DISCUSSION OF CERTAIN U.S. FEDERAL INCOME TAX
CONSEQUENCES IS INCLUDED HEREIN FOR GENERAL INFORMATION ONLY, AND DOES NOT
CONSTITUTE AND IS NOT A SUBSTITUTE FOR PROFESSIONAL TAX ADVICE. EACH HOLDER OF A
NOTE SHOULD CONSULT HIS, HER OR ITS OWN TAX ADVISOR AS TO THE U.S. FEDERAL,
STATE, LOCAL AND FOREIGN TAX CONSEQUENCES TO HIM, HER OR IT OF THE SOLICITATION.
HOLDINGS OF ICAHN ENTITIES
The Icahn Entities are the beneficial owners of approximately 58% of
the Notes and 77% of the outstanding common stock of Holdings. Mr. Icahn has
indicated that he anticipates that the Icahn Entities will vote in favor of the
Amendments.
YOUR CONSENT TO THE PROPOSED AMENDMENTS IS HEREBY REQUESTED.