AMERICAN SKIING COMPANY
$76,673,300 (plus accreted interest)
JUNIOR SUBORDINATED NOTES DUE 2012
INDENTURE
Dated as of November 24, 2004
Madeleine LLC
Trustee
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS.........................................................1
Section 1.01 Definitions.......................................1
Section 1.02 Other Definitions.................................8
Section 1.03 Rules of Construction.............................9
ARTICLE II. THE NOTES..........................................................9
Section 2.01 Form and Dating...................................9
Section 2.02 Title and Terms..................................11
Section 2.03 Execution and Authentication.....................12
Section 2.04 Registrar and Paying Agent.......................13
Section 2.05 Paying Agent to Hold Money in Trust..............13
Section 2.06 Holder Lists.....................................13
Section 2.07 Transfer and Exchange............................13
Section 2.08 Replacement Notes................................18
Section 2.09 Outstanding Notes................................18
Section 2.10 Treasury Notes...................................18
Section 2.11 Temporary Notes; Global Notes....................19
Section 2.12 Cancellation.....................................20
ARTICLE III. REDEMPTION.......................................................20
Section 3.01 Notices to Trustee...............................20
Section 3.02 Selection of Notes to be Redeemed................20
Section 3.03 Notice of Redemption.............................20
Section 3.04 Effect of Notice of Redemption...................21
Section 3.05 Deposit of Redemption Price......................21
Section 3.06 Notes Redeemed in Part...........................21
Section 3.07 Optional Redemption..............................21
Section 3.08 Mandatory Redemption.............................22
ARTICLE IV. COVENANTS.........................................................22
Section 4.01 Payment of Notes.................................22
Section 4.02 Reports..........................................22
Section 4.03 Compliance Certificate...........................22
Section 4.04 Stay, Extension and Usury Laws...................23
Section 4.05 Corporate Existence..............................23
Section 4.06 Restricted Payments..............................23
Section 4.07 Change of Control................................24
Section 4.08 Compliance with Laws.............................26
Section 4.09 Taxes............................................26
ARTICLE V. SUBORDINATION......................................................26
Section 5.01 Agreement to Subordinate.........................26
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Section 5.02 Liquidation; Dissolution, Bankruptcy.............27
Section 5.03 Default on Senior Debt; No Stock Collateral......27
Section 5.04 Acceleration of Notes............................28
Section 5.05 When Distribution Must Be Paid Over..............28
Section 5.06 Notice...........................................29
Section 5.07 Subrogation......................................29
Section 5.08 Relative Rights..................................29
Section 5.09 Subordination May Not Be Impaired by Company.....30
Section 5.10 Distribution or Notice to Representative.........31
Section 5.11 Rights of Trustee and Paying Agent...............31
Section 5.12 Authorization to Effect Subordination............32
Section 5.13 Payment..........................................32
Section 5.14 No Claims Against Subsidiaries...................32
Section 5.15 Amendments.......................................32
ARTICLE VI. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE..............33
Section 6.01 Company May Consolidate, Etc. Only On Certain
Terms.........................................33
Section 6.02 Successor Substituted............................34
ARTICLE VII. DEFAULTS AND REMEDIES............................................34
Section 7.01 Events of Default................................34
Section 7.02 Acceleration.....................................35
Section 7.03 Other Remedies...................................36
Section 7.04 Waiver of Past Defaults..........................36
Section 7.05 Control by Majority..............................36
Section 7.06 Limitation on Suits..............................36
Section 7.07 Rights of Holders to Receive Payment.............37
Section 7.08 Collection Suit by Trustee.......................37
Section 7.09 Trustee May File Proofs of Claim.................37
Section 7.10 Priorities.......................................37
Section 7.11 Undertaking for Costs............................38
Section 7.12 Additional Interest..............................38
ARTICLE VIII. TRUSTEE.........................................................39
Section 8.01 Duties of Trustee................................39
Section 8.02 Rights of Trustee................................39
Section 8.03 Individual Rights of Trustee.....................40
Section 8.04 Trustee's Disclaimer.............................40
Section 8.05 Notice of Defaults...............................40
Section 8.06 [Intentionally Omitted]..........................40
Section 8.07 Compensation and Indemnity.......................40
Section 8.08 Replacement of Trustee...........................41
Section 8.09 Successor Trustee by Merger, etc.................42
Section 8.10 Eligibility; Disqualification....................42
Section 8.11 Preferential Collection of Claims Against
Company.......................................43
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ARTICLE IX. DISCHARGE OF INDENTURE............................................43
Section 9.01 Termination of Company's Obligations.............43
Section 9.02 Repayment to Company.............................43
ARTICLE X. AMENDMENTS, SUPPLEMENTS AND WAIVERS................................44
Section 10.01 Without Consent of Holders.......................44
Section 10.02 With Consent of Holders..........................44
Section 10.03 Revocation and Effect of Consents................45
Section 10.04 Notation on or Exchange of Notes.................46
Section 10.05 Trustee Protected................................46
ARTICLE XI. MISCELLANEOUS.....................................................46
Section 11.01 [Intentionally Omitted]..........................46
Section 11.02 Notices..........................................46
Section 11.03 Communication by Holders with other Holders......48
Section 11.04 Certificate and Opinion as to Conditions
Precedent.....................................48
Section 11.05 Statements Required in Certificate or Opinion....48
Section 11.06 Rules by Trustee and Agents......................48
Section 11.07 Legal Holidays...................................49
Section 11.08 No Recourse Against Others.......................49
Section 11.09 Counterparts and Facsimile Signatures............49
Section 11.10 Governing Law, Submission to Jurisdiction........49
Section 11.11 No Adverse Interpretation of other Agreements....49
Section 11.12 Successors.......................................49
Section 11.13 Severability.....................................49
Section 11.14 Table of Contents, Headings, etc.................50
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INDENTURE, dated as of November 24, 2004, between American
Skiing Company, a Delaware corporation (the "COMPANY"), and Madeleine LLC, as
trustee (the "TRUSTEE").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders (as defined in
Section 1.01 hereof) of the Company's Junior Subordinated Notes due 2012 (the
"NOTES"):
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
"Accreted Value" means, for any Note, as of any date of
determination, the sum of (i) the Original Issue Price of the Note and (ii) any
interest in respect of such Note added to such Accreted Value pursuant to
Section 2.02 of this Indenture and the terms of such Note. Initially, upon the
Issuance Date, the amount under clause (ii) shall be zero.
"Affiliate" of any specified Person means any other Person
directly indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or otherwise;
provided, however, that beneficial ownership of 10% or more of the voting
securities of a Person shall be deemed to be control.
"Agent" means any Registrar or Paying Agent.
"Bank Credit Agreements" means (i) the Senior Credit
Agreements, (ii) any other credit, loan, reimbursement or other similar
agreements among the Company, any Subsidiary and any bank, insurance company,
finance company or other institutional lender, (iii) each instrument pursuant to
which Obligations under any of the agreements described in (i) or (ii) above,
are amended, deferred, extended, increased, renewed, replaced, refunded or
refinanced, in whole or in part, and (iv) each instrument now or hereafter
evidencing, governing, guarantying or securing any Indebtedness under any
agreements described in (i), (ii) or (iii) above, in each case, as modified,
amended, reformed, renewed, extended, restated or supplemented from time to
time.
"Board of Directors" means the Board of Directors of the
Company or any authorized committee of the Board of Directors.
"Business Day" means any day that is not a Legal Holiday.
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"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.
"Capital Stock" means any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, including, without limitation, partnership interests.
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Restricted Subsidiaries, taken as a whole, to any "person" (as such term is used
in Section 13(d)(3) of the Exchange Act) other than the Permitted Holders, or
(ii) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any "person" (as such term
is used in Section 13(d)(3) of the Exchange Act), other than the Permitted
Holders, becomes the "beneficial owner" (as such term is defined in Rule 13d-3
and Rule 13d-5 under the Exchange Act), directly or indirectly, of more than 50%
of the voting power of the Capital Stock of the Company, unless, in the case of
this clause (ii), the Permitted Holders retain the right or ability, by voting
power, contract or otherwise, to elect or designate a majority of the Board of
Directors of the Company.
"Company" means the party named as such above until a
successor replaces it in accordance with Article VI and thereafter means the
successor.
"Default" means any event that is, or with the passage of
time or the giving of notice or both would be, an Event of Default.
"Depositary" shall mean The Depository Trust Company, its
nominees and their respective successors.
"Designated Senior Debt" means the Company's Obligations under
the Bank Credit Agreements, Subordinated Convertible Notes and any other Senior
Debt of such Person permitted to be incurred by the Company the principal amount
of which is $25.0 million or more and that has been designated by the Board of
Directors as "Designated Senior Debt" by notice to the Trustee from both the
Company and the Senior Agent.
"Disqualified Capital Stock" means any Capital Stock that,
either by its terms or by the terms of any security into which it is convertible
or exchangeable or otherwise, is or upon the happening of an event or passage of
time would be, required to be redeemed prior to the one year anniversary of the
final Stated Maturity of the principal of the Notes or is redeemable at the
option of the holder thereof at any time prior to one year anniversary of the
final Stated Maturity, or is convertible into or exchangeable for debt
securities at any time prior to one year anniversary of the final Stated
Maturity at the option of the holder thereof; provided, however, that (i) any
class of Capital Stock of the Company that, by its terms, authorizes the Company
to satisfy in full its obligations with respect to the payment of dividends or
upon maturity, redemption (pursuant to a sinking fund or otherwise) or
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repurchase thereof or otherwise by the delivery of Qualified Capital Stock and
that is not convertible into, puttable or exchangeable for Disqualified Capital
Stock, shall not be deemed to be Disqualified Capital Stock so long as the
Company satisfies its obligations with respect thereto solely by the delivery of
Qualified Capital Stock and (ii) any class of Capital Stock which permits the
holders thereof to require the Company to repurchase their Capital Stock upon a
Change of Control shall not be deemed to be Disqualified Capital Stock so long
as the terms of such Capital Stock provide that no repurchase may occur until
after the Company has complied with all of its obligations under Section 4.07
hereunder.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock, but excluding any Indebtedness
that is convertible into, or exchangeable for Capital Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession, which are in effect on the Issuance Date and are applied
on a consistent basis.
"Guarantee" means a guarantee, other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner, including, without limitation, letters of credit and
reimbursement agreements in respect thereof, of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest and currency rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest or currency exchange rates.
"Holder" means a Person in whose name a Note is registered in
the register referred to in Section 2.04.
"Indebtedness" means, with respect to any Person, without
duplication, (i) any indebtedness of such Person, whether or not contingent, in
respect of borrowed money or evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in respect
thereof) or banker's acceptances or representing Capital Lease Obligations or
representing the balance deferred and unpaid of the purchase price of any
property or representing any Hedging Obligations, except any such balance that
constitutes an accrued expense or trade payable, if and to the extent any of the
foregoing indebtedness (other than letters of credit and Hedging Obligations)
would appear as a liability upon a balance sheet of such Person prepared in
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accordance with GAAP, all indebtedness of others secured by a lien on any asset
of such Person (whether or not such indebtedness is assumed by such Person) and,
to the extent not otherwise included, the Guarantee by such Person of any
indebtedness of any other Person. The amount of any Indebtedness outstanding as
of any date shall be the accreted value thereof, in the case of any Indebtedness
issued with original issue discount. Indebtedness shall not include liabilities
for taxes of any kind.
"Indenture" means this Indenture, as modified, amended,
reformed, renewed, extended, restated or supplemented from time to time.
"Insolvency or Liquidation Proceeding" means, with respect to
any Person, (i) any insolvency or bankruptcy or similar case or proceeding, or
any reorganization, receivership, liquidation, dissolution or winding up of such
Person, whether voluntary or involuntary, or (ii) any assignment for the benefit
of creditors or any other marshalling of assets and liabilities of such Person.
"Interest Accrual Date" means, with respect to any installment
of interest on any Notes, the dates specified in Section 2.02 as the fixed dates
on which such installment of interest accrues and is added to the Accreted Value
in effect immediately prior to the applicable Interest Accrual Date.
"Issuance Date" means the date on which the Notes are first
authenticated and issued.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
"Majority Holders" means, at any time, the Holders of a
majority in aggregate Accreted Value of the then outstanding Notes.
"Maturity" means, with respect to any Note, the date on which
the Accreted Value of such Note becomes due and payable as therein provided and
as provided in this Indenture, whether at the Stated Maturity, the Purchase Date
or otherwise.
"Notes" has the meaning set forth in the preamble hereto.
"Obligations" with respect to any instrument or agreement
means any and all principal, Accreted Value, interest (including Post-Petition
Interest), penalties, premiums, fees (including, without limitation, to the
extent provided for in such instrument or agreement, fees and expenses of
counsel), indemnifications, reimbursements, damages and other charges,
obligations and liabilities existing from time to time under such instrument or
agreement, whether direct or indirect, joint or several, actual, absolute or
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contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, including any
obligations or liabilities to repay, redeem, repurchase, retire, acquire or
defease any Indebtedness under such instrument or agreement, or any obligation
to establish a sinking fund for any such purpose.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Treasurer, the Secretary, any Assistant Treasurer or any
Assistant Secretary of the Company.
"Officers' Certificate" means a certificate of the Company
signed by two Officers, one of whom must be the Chairman of the Board, the
President, the Treasurer or a Vice President of the Company.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. The counsel may be an
employee of or counsel to the Company, any Subsidiary of the Company or the
Trustee.
"Original Issue Price" means, with respect to any Note, the
amount designated as original issue price on the face of such Note.
"Permitted Holders" means (a) Leslie B. Otten (or, in the
event of his incompetence or death, his estate and his estate's heirs, executor,
administrator, committee or other representative (collectively, "Heirs")), (b)
any Person in which Leslie B. Otten and his Heirs, directly or indirectly, have
an 80% controlling interest, and/or (c) Oak Hill Capital Partners, L.P. and Oak
Hill Securities Fund, L.P. and their respective affiliates and associates.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Post-Petition Interest" means, with respect to any
Indebtedness of any Person, all interest accrued or accruing on such
Indebtedness after the commencement of any Insolvency or Liquidation Proceeding
against such Person in accordance with and at the contract rate (including,
without limitation, any rate applicable upon default) specified in the agreement
or instrument creating, evidencing or governing such Indebtedness, whether or
not, pursuant to applicable law or otherwise, the claim for such interest is
allowed as a claim in such Insolvency or Liquidation Proceeding.
"Purchasers" means Madeleine LLC and its Affiliates.
"Qualified Capital Stock" of any Person means any and all
Capital Stock of such Person other than Disqualified Capital Stock.
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"Representative" means, with respect to any Senior Debt, the
agent or other representative(s), if any, of holders of such Senior Debt.
"Responsible Officer," when used with respect to the Trustee,
means (i) with respect to Madeleine LLC or any of its Affiliates as Trustee,
means Mark A. Neporent, Vice President and Chief Operating Officer of Madeleine
LLC or Kevin Genda, Vice President of Madeleine LLC, or any successor thereto
and (ii) with respect to any other Person as Trustee, any Trust Officer of the
Trustee or, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his or her knowledge of and
familiarity with the particular subject.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Agents" means, collectively, (i) (A) until all
Indebtedness under the Bank Credit Agreements is paid in full in cash, the agent
(or the institution performing similar functions) under the Bank Credit
Agreement under which the greatest aggregate principal amount of Indebtedness is
outstanding and (B) if all Indebtedness under the Bank Credit Agreements has
been paid in full, the Person (or representative of the Persons) holding the
greatest amount of Senior Debt other than Senior Notes, (ii) until all
Indebtedness under the Senior Notes has been paid in full in cash, the trustee
under the Senior Indenture, and (iii) until all Indebtedness under the
Subordinated Convertible Notes has been paid in full in cash, the trustee under
the Subordinated Convertible Notes Indenture.
"Senior Credit Agreements" means the credit agreements, dated
November 24, 2004, between the Company, as borrower, General Electric Capital
Corporation, as administrative agent, the lenders named therein, Credit Suisse
First Boston ("CSFB"), as syndication agent, GECC Capital Markets Group, Inc.
and CSFB, as co-lead arranging agents, and certain other parties named therein,
as modified, amended, increased, restated or supplemented from time to time.
"Senior Debt" of any Person means and includes all principal
of, premium and interest on and other Obligations with respect to (i) the Bank
Credit Agreements, (ii) the Senior Notes, (iii) the Subordinated Convertible
Notes, (iv) any other Indebtedness of such Person (other than as otherwise
provided in this definition), and (v) any trade payables incurred in the
ordinary course of business, whether outstanding on the date of issuance of the
Notes or thereafter incurred. Notwithstanding the foregoing, Senior Debt shall
not include (1) the portion of any Indebtedness incurred in violation of this
Indenture, (2) any Indebtedness that expressly provides that it shall rank pari
passu with, or subordinated to, in right of payment with the Notes, (3)
Indebtedness evidenced by the Notes, (4) Indebtedness which when incurred and
without respect to any election under Section 1111(b) of the United States
Bankruptcy Code is without recourse to the Company or any of its Subsidiaries,
(5) any liability for foreign, federal, state, local or other taxes owed or
owing by the Company, (6) Indebtedness of such Person to the extent such
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liability constitutes Indebtedness to a Subsidiary of the Company or (7)
Indebtedness owed by the Company for compensation to employees.
"Senior Indenture" means the Indenture, dated as of June 28,
1996, between the Company (as successor to ASC East, Inc.), and United States
Trust Company of New York as trustee, as modified, amended, restated or
supplemented from time to time.
"Senior Notes" means the 12% Series A and Series B Senior
Subordinated Notes due 2006, issued by the Company pursuant to the Senior
Indenture.
"Stated Maturity" when used with respect to any Indebtedness
or any installment of interest thereon, means the dates specified in such
Indebtedness as the fixed date on which the principal of such Indebtedness, the
Accreted Value or such installment of interest, as the case may be, is due and
payable.
"Stock Collateral" means any Equity Interests in any
Subsidiary of the Company.
"Subordinated Obligations" means all Indebtedness and other
Obligations of the Company or any of its Subsidiaries, contingent or otherwise,
now or hereafter existing under or in respect of the Notes (pursuant to the
terms thereof or any other agreement or instrument relating thereto) or this
Indenture.
"Subordinated Convertible Notes" means the 11.3025%
Convertible Subordinated Notes due 2007, issued by the Company pursuant to the
Subordinated Convertible Notes Indenture.
"Subordinated Convertible Notes Indenture" means the
Indenture, dated as of August 31, 2001, between the Company and Oak Hill Capital
Partners, L.P. as trustee, as modified, amended, restated or supplemented from
time to time.
"Subsidiary" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of such Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner of
the managing general partner of which is such Person or a Subsidiary of such
Person or (b) the only general partners of which are such Person or of one or
more Subsidiaries of such Person (or any combination thereof).
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means such successor.
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"Trust Officer" means the Chairman of the Board, the President
or any other officer or assistant officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
Section 1.02 Other Definitions.
TERM DEFINED
IN SECTION
"AGENT MEMBERS"...................... 2.01
"BANKRUPTCY LAW"..................... 7.01
"CEDEL".............................. 2.01
"CHANGE OF CONTROL PAYMENT".......... 4.07
"COMMENCEMENT DATE".................. 4.07
"CUSTODIAN".......................... 7.01
"EUROCLEAR".......................... 2.01
"EVENT OF DEFAULT"................... 7.01
"GLOBAL NOTES"....................... 2.01
"LEGAL HOLIDAY"...................... 11.07
"NON-DEFAULT COVENANT BREACH"........ 7.12
"OFFER AMOUNT"....................... 4.07
"PAYING AGENT"....................... 2.04
"PAYMENT BLOCKAGE NOTICE"............ 5.03
"PAYMENT DEFAULT".................... 7.01
"PURCHASE DATE"...................... 4.07
"PURCHASE OFFER"..................... 4.07
"QIBS"............................... 2.01
"REGISTRAR".......................... 2.04
"REGULATION S GLOBAL NOTE"........... 2.01
"REGULATION S"....................... 2.01
"RESTRICTED NOTES"................... 2.01
"RULE 144A GLOBAL NOTE".............. 2.01
"RULE 144A".......................... 2.01
"SURVIVING ENTITY"................... 6.01
"TENDER PERIOD"...................... 4.07
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Section 1.03 Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP consistently applied;
(c) "OR" is not exclusive;
(d) words in the singular include the plural, and in the plural
include the singular;
(e) provisions apply to successive events and transactions;
(f) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement or successor sections or rules
adopted by the SEC from time to time; and
(g) a reference to "$" or U.S. Dollars is to United States dollars.
ARTICLE II
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto, which is hereby
incorporated by reference and expressly made a part of this Indenture. The Notes
may have notations, legends or endorsements required by law, stock exchange
rule, agreements to which the Company is subject, if any, or usage (provided
that any such notation, legend or endorsement is in a form acceptable to the
Company). The Company shall furnish any such legend not contained in Exhibit A
to the Trustee in writing. Each Note shall be dated the date of its
authentication. The Notes shall be issued only in denominations of Accreted
Value with $100 of Original Issue Price and integral multiples thereof. The
terms and provisions of the Notes set forth in Exhibit A are part of this
Indenture and to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby. However, to the extent any provision of any
Note conflicts with the express provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.
(b) Global Notes. Notes transferred in reliance on Regulation S under the
Securities Act ("REGULATION S"), as provided in Section 2.07(a)(ii) hereof,
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shall be issued in the form of one or more permanent Global Notes in definitive,
fully registered form without interest coupons with the Global Notes Legend and
Restricted Notes Legend set forth in Exhibit A hereto (the "REGULATION S GLOBAL
NOTE"), which shall be deposited on behalf of the transferee of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of the
Euroclear System ("EUROCLEAR") or Cedelbank ("CEDEL"), duly executed by the
Company and authenticated by the Trustee as hereinafter provided. The aggregate
principal amount of the Regulation S Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee and the
Depositary or its nominee as hereinafter provided.
Notes transferred to Qualified Institutional Buyers ("QIBS") in reliance on
Rule 144A under the Securities Act ("RULE 144A"), as provided in Section
2.07(a)(ii) hereof, shall be issued in the form of one or more permanent Global
Notes in definitive, fully registered form without interest coupons with the
Global Notes Legend and Restricted Notes Legend set forth in Exhibit A hereto
("RULE 144A GLOBAL NOTE"), which shall be deposited on behalf of the purchasers
of the Notes represented thereby with the Trustee, at its New York office, as
custodian for the Depositary, and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount of the Rule 144A
Global Note may from time to time be increased or decreased by adjustments made
on the records of the Trustee and the Depositary or its nominee as hereinafter
provided.
Notwithstanding the foregoing, for so long as the Purchasers hold the
Notes, the Notes shall be held by them in certificated form.
(c) Book-Entry Provisions. This Section 2.01(c) shall apply only to the
Regulation S Global Note and the Rule 144A Global Note issued in the form of one
or more permanent Global Notes (collectively, the "GLOBAL NOTES") deposited with
or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with this
Section 2.01(c), authenticate and deliver initially one or more Global Notes
that (a) shall be registered in the name of the Depositary for such Global Note
or Global Notes or the nominee of such Depositary and (b) shall be delivered by
the Trustee to such Depositary or pursuant to such Depositary's instructions or
held by the Trustee as custodian for the Depositary.
Members of, or participants in, the Depositary ("AGENT MEMBERS") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depositary or by the Trustee as the custodian of the Depositary or
under such Global Note, and the Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Note for all purposes whatsoever. Notwithstanding the foregoing,
11
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of the
Depositary governing the exercise of the rights of an owner of a beneficial
interest in any Global Note.
Notwithstanding the foregoing, for so long as the Purchasers hold the
Notes, the Notes shall not be issued in the form of Global Notes.
(d) Certificated Notes. Notes transferred to "accredited investors" (as
defined in Rule 501 (a) (1), (2), (3), (4), (5), (6) and (7) of Regulation D
under the Securities Act), as provided in Section 2.07(a), or to any Person in a
transaction exempt from the registration requirements of the Securities Act,
other than a Person who elects to receive a Global Note as provided elsewhere in
the Indenture, shall be issued in the form of one or more certificated Notes in
definitive, fully registered form without interest coupons with the Restricted
Notes Legend set forth in Exhibit A hereto ("RESTRICTED NOTES"), which shall be
registered in the name of such Accredited Investor or its nominee, duly executed
by the Company and authenticated by the Trustee as hereinafter provided. Such
Restricted Notes may only be transferred in reliance on Regulation S or to QIBs
in reliance on Rule 144A, pursuant to another exception from registration under
the Securities Act or pursuant to an effective registration statement.
In addition to the provisions of Section 2.11, owners of beneficial
interests in Global Notes may, if the Company, at its option, notifies the
Trustee in writing that it elects to cause the issuance of certificated Notes,
receive a certificated Note, which certificated Note shall bear the Restricted
Notes Legend set forth in Exhibit A hereto unless otherwise provided in this
Section 2.01(d) and Section 2.07(b) hereof.
Section 2.02 Title and Terms.
The aggregate Original Issue Price of Notes which may be authenticated and
delivered under this Indenture is limited to $76,673,300, except for Notes
authenticated and delivered upon registration of transfer of, or in exchange for
or in lieu of, other Notes pursuant to Sections 2.03, 2.04, 2.07, 2.08, 4.07 and
10.04.
The Notes shall be known and designated as the "Junior Subordinated Notes
due 2012" of the Company. The Stated Maturity of the Accreted Value of the Notes
shall be May 24, 2012 and the Notes shall each bear interest on the Accreted
Value thereof at rates as indicated below (subject to the increase as provided
in Section 7.12 hereof) from November 24, 2004 until the Stated Maturity of the
Accreted Value.
Year Interest Rate
----------------- --------------
Remainder of 2004 11.25%
2005 11.25%
2006 11.25%
2007 11.75%
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2008 12.50%
2009 12.50%
2010 12.75%
2011 13.00%
2012 13.00%
On each January 1 on which the Notes are outstanding, commencing January 1,
2005, and at the Stated Maturity of the Accreted Value, interest on the Notes
shall accrue and be paid through the addition of such interest to the Accreted
Value in effect immediately prior to the applicable Interest Accrual Date. On
the applicable Interest Accrual Date, the Accreted Value shall increase by the
amount of such interest.
On Maturity, the Accreted Value shall be payable at the office or agency of
the Company maintained for such purpose. If a Holder so requests, Accreted
Value, accrued and unpaid interest thereon, and premium, if any, may be paid by
wire transfer of immediately available funds to an account previously specified
in writing by such Holder to the Company and the Trustee.
Holders shall have the right to require the Company to repurchase their
Notes, in whole or in part, in the event of a Change of Control, pursuant to
Section 4.07.
Section 2.03 Execution and Authentication.
One Officer shall sign the Notes for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office at
the time the Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature of an
authorized officer of the Trustee. The signature shall be conclusive evidence
that the Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by an
Officer, authenticate Notes for Original Issue Price up to an amount stated in
paragraph 4 of the Note. The aggregate Notes outstanding at any time may not
have an aggregate Original Issue Price that exceeds $76,673,300 except as
provided in Section 2.08.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Notes. An authenticating agent may authenticate Notes whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with Holders, the Company or an Affiliate.
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Section 2.04 Registrar and Paying Agent.
The Company shall maintain (i) offices or agencies where the Notes may be
presented for registration of transfer or for exchange ("REGISTRAR") and (ii)
offices or agencies where the Notes may be presented for payment ("PAYING
AGENT"); provided that if the only Holders are the Purchasers, such offices or
agencies shall be the executive offices of the Company as set forth in Section
11.02. The Company shall act initially as principal Registrar and Paying Agent.
The principal Registrar shall keep a register of the Notes and of their transfer
and exchange. The Company may appoint one or more co-registrars and, one or more
additional paying agents in such other locations as it shall determine. The term
"Registrar" includes any co-registrar and, the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without prior notice to any Holder. The Company shall notify the Trustee of the
name and address of any Agent not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Affiliates may act as
Paying Agent or Registrar.
Section 2.05 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of the
Accreted Value at Maturity, and will notify the Trustee of any default by the
Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee
and to account for any money disbursed by it. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or an Affiliate
of the Company) shall have no further liability for the money. If the Company or
an Affiliate of the Company acts as Paying Agent, it shall segregate and hold in
a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent.
Section 2.06 Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company shall furnish to the
Trustee at such times as the Trustee may request in writing a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Holders.
Section 2.07 Transfer and Exchange.
Where Notes are presented to the Registrar or a co-registrar with a request
to register a transfer or to exchange them for one or more new Notes of any
authorized denomination or denominations, of a like aggregate Accreted Value,
the Registrar shall register the transfer or make the exchange if its
requirements for such transactions are met. To permit registrations of transfers
and exchanges, the Company shall issue and the Trustee shall authenticate Notes
at the Registrar's request. No service charge shall be made for any registration
14
of transfer or exchange (except as otherwise expressly permitted herein), but
the Company may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any such
transfer tax or similar governmental charge payable upon exchanges pursuant to
Sections 2.11 or 10.05 hereof).
(a) Notwithstanding any provision to the contrary herein, so long as a
Global Note remains outstanding and is held by or on behalf of the Depositary,
transfers of a Global Note, in whole or in part, or of any beneficial interest
therein, shall only be made in accordance with Section 2.01(b) and this Section
2.07(a); provided, however, that beneficial interests in a Global Note may be
transferred to Persons who take delivery thereof in the form of a beneficial
interest in the same Global Note in accordance with the transfer restrictions
set forth in the Restricted Notes Legend.
(i) Except for transfers or exchanges made in accordance with clauses
(ii) through (iv) of this Section 2.07(a), transfers of a Global Note shall
be limited to transfers of such Global Note in whole, but not in part, to
nominees of the Depositary or to a successor of the Depositary or such
successor's nominee.
(ii) Rule 144A Global Note to Regulation S Global Note. If an owner of
a beneficial interest in the Rule 144A Global Note deposited with the
Depositary or the Trustee as custodian for the Depositary wishes at any
time to transfer its interest in such Rule 144A Global Note to a Person who
is required to take delivery thereof in the form of an interest in the
Regulation S Global Note, such owner may, subject to the rules and
procedures of the Depositary, exchange or cause the exchange of such
interest for an equivalent beneficial interest in the Regulation S Global
Note. Upon receipt by the principal Registrar of (1) instructions given in
accordance with the Depositary's procedures from an Agent Member directing
the principal Registrar to credit or cause to be credited a beneficial
interest in the Regulation S Global Note in an amount equal to the
beneficial interest in the Rule 144A Global Note to be exchanged, (2) a
written order given in accordance with the Depositary's procedures
containing information regarding the participant account of the Depositary
and the Euroclear or Cedel account to be credited with such increase and
(3) a certificate in the form of Exhibit B attached hereto given by the
Holder of such beneficial interest, then the principal Registrar shall
instruct the Depositary to reduce or cause to be reduced the Accreted Value
of the Rule 144A Global Note and to increase or cause to be increased the
Accreted Value of the Regulation S Global Note by the aggregate Accreted
Value of the beneficial interest in the Rule 144A Global Note equal to the
beneficial interest in the Regulation S Global Note to be exchanged or
transferred, to credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Regulation S
Global Note equal to the reduction in the Accreted Value of the Rule 144A
Global Note and to debit or cause to be debited from the account of the
Person making such exchange or transfer the beneficial interest in the Rule
144A Global Note that is being exchanged or transferred.
15
(iii) Regulation S Global Note to Rule 144A Global Note. If an owner
of a beneficial interest in the Regulation S Global Note deposited with the
Depositary or with the Trustee as custodian for the Depositary wishes at
any time to transfer its interest in such Regulation S Global Note to a
Person who is required to take delivery thereof in the form of an interest
in the Rule 144A Global Note, such Holder may, subject to the rules and
procedures of Euroclear or Cedel, as the case may be, and the Depositary,
exchange or cause the exchange of such interest for an equivalent
beneficial interest in the Rule 144A Global Note. Upon receipt by the
principal Registrar of (1) instructions from Euroclear or Cedel, if
applicable, and the Depositary, directing the principal Registrar to credit
or cause to be credited a beneficial interest in the Rule 144A Global Note
equal to the beneficial interest in the Regulation S Global Note to be
exchanged or transferred, (2) a written order given in accordance with the
Depositary's procedures containing information regarding the participant
account of the Depositary and (3) a certificate in the form of Exhibit C
attached hereto given by the owner of such beneficial interest, then
Euroclear or Cedel or the principal Registrar, as the case may be, will
instruct the Depositary to reduce or cause to be reduced the Accreted Value
of the Regulation S Global Note and to increase or cause to be increased
the Accreted Value of the Rule 144A Global Note by the aggregate Accreted
Value of the beneficial interest in the Regulation S Global Note to be
exchanged or transferred, and the principal Registrar shall instruct the
Depositary, concurrently with such reduction, to credit or cause to be
credited to the account of the Person specified in such instructions a
beneficial interest in the Rule 144A Global Note equal to the reduction in
the Accreted Value of the Regulation S Global Note and to debit or cause to
be debited from the account of the Person making such exchange or transfer
the beneficial interest in the Regulation S Global Note that is being
exchanged or transferred.
(iv) Global Note to Restricted Note. If an owner of a beneficial
interest in a Global Note deposited with the Depositary or with the Trustee
as custodian for the Depositary wishes at any time to transfer its interest
in such Global Note to a Person who is required to take delivery thereof in
the form of a Restricted Note, such owner may, subject to the rules and
procedures of Euroclear or Cedel, if applicable, and the Depositary, cause
the exchange of such interest for one or more Restricted Notes of any
authorized denomination or denominations and of the same aggregate Accreted
Value. Upon receipt by the principal Registrar of (1) instructions from
Euroclear or Cedel, if applicable, and the Depositary directing the
principal Registrar to authenticate and deliver one or more Restricted
Notes of the same aggregate Accreted Value as the beneficial interest in
the Global Note to be exchanged, such instructions to contain the name or
names of the designated transferee or transferees, the authorized
denomination or denominations of the Restricted Notes to be so issued and
appropriate delivery instructions, (2) a certificate in the form of Exhibit
D attached hereto given by the owner of such beneficial interest to the
effect set forth therein, (3) a certificate in the form of Exhibit E
attached hereto given by the Person acquiring the Restricted Notes for
which such interest is being exchanged, to the effect set forth therein,
and (4) such other certifications, legal opinions or other information as
the Company may reasonably require to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act, then Euroclear or Cedel,
if applicable, or the principal Registrar, as the case may be, will
instruct the Depositary to reduce or cause to be reduced such Global Note
by the aggregate Accreted Value of the beneficial interest therein to be
16
exchanged and to debit or cause to be debited from the account of the
Person making such transfer the beneficial interest in the Global Note that
is being transferred, and concurrently with such reduction and debit the
Company shall execute, and the Trustee shall authenticate and deliver, one
or more Restricted Notes of the same aggregate Accreted Value in accordance
with the instructions referred to above.
(v) Restricted Note to Restricted Note. If a Holder of a Restricted
Note wishes at any time to transfer such Restricted Note to a Person who is
required to take delivery thereof in the form of a Restricted Note, such
Holder may, subject to the restrictions on transfer set forth herein and in
such Restricted Note, cause the exchange of such Restricted Note for one or
more Restricted Notes of any authorized denomination or denominations and
of the same aggregate Accreted Value. Upon receipt by the principal
Registrar of (1) such Restricted Note, duly endorsed as provided herein,
(2) instructions from such Holder directing the principal Registrar to
authenticate and deliver one or more Restricted Notes of the same aggregate
Accreted Value as the Restricted Note to be exchanged, such instructions to
contain the name or authorized denomination or denominations of the
Restricted Notes to be so issued and appropriate delivery instructions, (3)
a certificate from the Holder of the Restricted Note to be exchanged in the
form of Exhibit D attached hereto, (4) a certificate in the form of Exhibit
E attached hereto given by the Person acquiring the Restricted Notes for
which such interest is being exchanged, to the effect set forth therein,
and (5) such other certifications, legal opinions or other information as
the Company may reasonably require to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act, then the Registrar shall
cancel or cause to be canceled such Restricted Note and concurrently
therewith, the Company shall execute, and the Trustee shall authenticate
and deliver, one or more Restricted Notes of the same aggregate Accreted
Value, in accordance with the instructions referred to above.
(vi) Restricted Note to Rule 144A Global Note. If an owner of a
Restricted Note registered in the name of such owner wishes at any time to
transfer such Restricted Note to a Person who is required to take delivery
thereof in the form of an interest in the Rule 144A Global Note, such
Holder may, subject to the rules and procedures of the Depositary, exchange
or cause the exchange of such Restricted Note for an equivalent beneficial
interest in the Rule 144A Global Note. Upon receipt by the principal
Registrar of (1) instructions from the Company, directing the principal
Registrar (A) to credit or cause to be credited a beneficial interest in
the Rule 144A Global Note equal to the Accreted Value of the Restricted
Note to be exchanged or transferred and (B) to cancel such Restricted Note
to be exchanged or transferred, (2) a written order given in accordance
with the Depositary's procedures containing information regarding the
participant account of the Depositary and (3) a certificate in the form of
Exhibit C attached hereto given by the owner of such Restricted Note, then
the principal Registrar will instruct the Trustee to cancel such Restricted
Note and will instruct the Depositary to increase or cause to be increased
the Accreted Value of the Rule 144A Global Note by the Accreted Value of
17
the Restricted Note to be exchanged or transferred, and the principal
Registrar shall instruct the Depositary, concurrently with such
cancellation of the Restricted Note, to credit or cause to be credited to
the account of the Person specified in such instructions a beneficial
interest in the Rule 144A Global Note equal to the Accreted Value of the
Restricted Note to be canceled by the Trustee.
(vii) Restricted Note to Regulation S Global Note. If an owner of a
Restricted Note registered in the name of such owner wishes at any time to
transfer such Restricted Note to a Person who is required to take delivery
thereof in the form of an interest in the Regulation S Global Note, such
owner may, subject to the rules and procedures of the Euroclear or Cedel,
as the case may be, exchange or cause the exchange of such Restricted Note
for an equivalent beneficial interest in the Regulation S Global Note. Upon
receipt by the principal Registrar of (1) instructions from the Company,
directing the principal Registrar (A) to credit or cause to be credited a
beneficial interest in the Regulation S Global Note equal to the Accreted
Value of the Restricted Note to be exchanged or transferred and (B) to
cancel such Restricted Note to be exchanged or transferred, (2) a written
order given in accordance with the Depositary's procedures containing
information regarding the participant account of the Euroclear or Cedel
account to be credited with such increase and (3) a certificate in the form
of Exhibit B attached hereto given by the Holder of such Restricted Note,
then the principal Registrar will instruct the Trustee to cancel such
Restricted Note and will instruct the Depositary to increase or cause to be
increased the Accreted Value of the Regulation S Global Note by the
Accreted Value of the Restricted Note to be exchanged or transferred, and
the principal Registrar shall instruct the Depositary, concurrently with
such cancellation of the Restricted Note, to credit or cause to be credited
to the account of the Person specified in such instructions a beneficial
interest in the Regulation S Global Note equal to the Accreted Value of the
Restricted Note to be canceled by the Trustee.
(viii) Other Exchanges. In the event that a beneficial interest in a
Global Note is exchanged for a certificated Note in definitive registered
form pursuant to Section 2.11, such Notes may be exchanged only in
accordance with such procedures as are substantially consistent with the
provisions of clauses (ii) through (v) above (including the certification
requirements intended to ensure that such transfers comply with Rule 144A,
Rule 144, Regulation S or any other available exemption from registration,
as the case may be) and such other procedures as may from time to time be
adopted by the Company.
(b) If Notes are issued upon the transfer, exchange or replacement of Notes
bearing the Restricted Securities Legend set forth in Exhibit A hereto, or if a
request is made to remove such Restricted Notes Legend on Notes, the Notes so
issued shall bear the Restricted Notes Legend, or the Restricted Notes Legend
shall not be removed, as the case may be, unless there is delivered to the
Company such satisfactory evidence, which may include an opinion of counsel
licensed to practice law in the State of New York, as may be reasonably required
by the Company, that neither the legend nor the restrictions on transfer set
forth therein are required to ensure that transfers thereof comply with the
provisions of Rule 144A, Rule 144, Regulation S or any other available exemption
from registration under the Securities Act or, with respect to Restricted Notes,
that such Notes are not "restricted" within the meaning of Rule 144 under the
Securities Act. Upon provision of such satisfactory evidence, the Trustee, at
the direction of the Company, shall authenticate and deliver Notes that do not
bear the legend.
18
(c) Neither the Company nor the Trustee shall have any responsibility for
any actions taken or not taken by the Depositary and the Company shall have no
responsibility for any actions taken or not taken by the Trustee as agent or
custodian of the Depositary.
Section 2.08 Replacement Notes.
If the Holder of a Note claims that the Note has been lost, destroyed or
wrongfully taken or if such Note is mutilated and is surrendered to the Trustee,
the Company shall issue and the Trustee shall authenticate a replacement Note if
the Trustee's and the Company's requirements are met. If required by the Trustee
or the Company, an indemnity bond must be sufficient in the judgment of both to
protect the Company, the Trustee, any Agent or any authenticating agent from any
loss which any of them may suffer if a Note is replaced. The Company may charge
for its reasonable expenses in replacing a Note.
In case any such mutilated, destroyed, lost or stolen Note has become or is
about to become due and payable, the Company in its discretion may, instead of
issuing a new Note, pay such Note.
Every replacement Note is an additional obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.09 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
and those described in this Section as not outstanding.
If a Note is replaced, paid or purchased pursuant to Section 2.08 hereof,
it ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced, paid or purchased Note is held by a bona fide purchaser. If
the Accreted Value of any Note is considered paid under Section 4.01 hereof, it
ceases to be outstanding and interest on it ceases to accrue.
Except as set forth in Section 2.10 hereof, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.
Section 2.10 Treasury Notes.
In determining whether the Holders of the required Accreted Value of Notes
have concurred in any direction, waiver or consent, Notes owned by the Company
or a Subsidiary of the Company shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes that the Trustee knows are so owned shall be so disregarded.
19
Section 2.11 Temporary Notes; Global Notes.
(a) Until definitive Notes are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes. Holders of temporary Notes shall be entitled to
all of the benefits of this Indenture.
(b) A Global Note deposited with the Depositary or with the Trustee as
custodian for the Depositary pursuant to Section 2.01 shall be transferred to
the beneficial owners thereof in the form of certificated Notes only in
accordance with Section 2.01(d) or if such transfer complies with Section 2.07
and (i) the Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Note or if at any time such Depositary
ceases to be a "clearing agency" registered under the Exchange Act and a
successor Depositary is not appointed by the Company within 90 days after
receipt of such notice or after it becomes aware of such cessation or (ii) an
Event of Default has occurred and is continuing.
(c) Any Global Note that is transferable to the beneficial owners thereof
in the form of certificated Notes pursuant to Section 2.01(d) or to this Section
2.11 shall be surrendered by the Depositary to the Trustee to be so transferred,
in whole or from time to time in part, without charge, and the Trustee shall
authenticate and deliver, upon such transfer of each portion of such Global
Note, an equal aggregate Accreted Value of Notes of authorized denominations in
the form of certificated Notes. Any portion of a Global Note transferred
pursuant to this Section 2.11 shall be executed, authenticated and delivered
only in denominations of Accreted Value with $100 of Original Issue Price and
any integral multiple thereof and registered in such names as the Depositary
shall direct. Any Note in the form of certificated Notes delivered in exchange
for an interest in the Global Notes shall, except as otherwise provided by
Section 2.07(b), bear the Restricted Notes Legend set forth in Exhibit A hereto.
(d) The registered Holder of a Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
(e) In the event of the occurrence of either of the events specified in
Section 2.11(b), the Company will promptly make available to the Trustee a
reasonable supply of certificated Notes in definitive, fully registered form
without interest coupons.
20
Section 2.12 Cancellation.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee shall promptly cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
canceled Notes as the Company directs. The Company may not issue new Notes to
replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
ARTICLE III
REDEMPTION
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of the Notes and Section 3.07 hereof, it shall notify the Trustee of
the redemption date and the Accreted Value of Notes to be redeemed. The Company
shall give each notice provided for in this Section 3.01 at least 45 days before
the redemption date (unless a shorter notice period shall be reasonably
satisfactory to the Trustee).
Section 3.02 Selection of Notes to be Redeemed.
If less than all of the Notes are to be redeemed at any time, selection of
Notes shall be made by the Trustee on a pro rata basis or by lot or by method
that complies with the requirements of any exchange on which the Notes are
listed and that the Trustee considers fair and appropriate, provided that no
Notes with Accreted Value with Original Issue Price of less than $100 shall be
redeemed in part. The Trustee shall make the selection not more than 60 days and
not less than 30 days before the redemption date from Notes outstanding not
previously called for redemption. Notes and portions of Notes selected shall be
in amounts of Accreted Value with $100 of Original Issue Price or integral
multiples thereof. Provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption. The Trustee
shall notify the Company promptly of the Notes or portions of Notes to be called
for redemption.
Section 3.03 Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date, the
Company shall mail, by first class mail, a notice of redemption to each Holder
whose Notes are to be redeemed at its registered address. The notice shall
identify the Notes to be redeemed and shall state:
(a) the redemption date;
21
(b) the redemption price;
(c) if any Note is to be redeemed in part only, the portion of the
Accreted Value with $100 Original Issue Price thereof redeemed, and that,
after the redemption date, upon surrender of such Note, a new Note in
Accreted Value and Original Issue Price equal to the unredeemed portion
thereof shall be issued in the name of the Holder thereof upon cancellation
of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price plus accrued interest, if any;
(f) that interest on Notes called for redemption ceases to accrue on
and after the redemption date; and
(g) the paragraph of the Notes pursuant to which the Notes called for
redemption are being redeemed.
At the Company's request, the Trustee shall give notice of redemption in
the Company's name and at its expense; provided that the Company shall have
delivered to the Trustee, at least 45 days prior to the redemption date, an
Officers' Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice, as provided in the preceding
paragraph.
Section 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become due and payable on the redemption date at the
price set forth in the Notes. A notice of redemption may not be conditional.
Section 3.05 Deposit of Redemption Price.
On or before the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price of
and accrued interest on all Notes to be redeemed on that date. The Trustee or
the Paying Agent shall return to the Company any money not required for that
purpose.
Section 3.06 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and the Trustee shall authenticate for the Holder at the expense of the Company
a new Note equal in Accreted Value and Original Issue Price to the unredeemed
portion of the Note surrendered.
Section 3.07 Optional Redemption.
22
The Company may redeem all or any portion of the Notes, upon the terms and
at the redemption prices set forth in the Notes. Any redemption pursuant to this
Section 3.07 shall be made pursuant to the provisions of Section 3.01 through
3.06 hereof.
Section 3.08 Mandatory Redemption.
The Company shall not be required to make mandatory redemption payments or
sinking fund payments with respect to the Notes.
ARTICLE IV
COVENANTS
Section 4.01 Payment of Notes.
The Company shall pay the Accreted Value and any other amounts due on the
Notes, if any, at Maturity in the manner provided in the Notes. The Accreted
Value and other amounts due on the Notes, if any, shall be considered paid on
the date due if the Paying Agent (other than the Company or an Affiliate of the
Company) holds on that date money designated for and sufficient to pay all
Accreted Value and such other amounts payable on the Notes, if any, then due. To
the extent lawful, the Company shall pay interest (including Post-Petition
Interest in any proceeding under any Bankruptcy Law) on overdue Accreted Value
and any other amounts due on the Notes, if any, at the rate borne by the Notes,
compounded annually.
Section 4.02 Reports.
Whether or not required by the rules and regulations of the SEC, so long as
any Notes are outstanding, the Company shall furnish within 45 days after the
end of each fiscal quarter of the Company (90 days with respect to the end of
the Company's fiscal year) to the Trustee and to the Holders, all quarterly and
annual financial statements required to be contained in a filing with the SEC on
Forms 10-Q and 10-K and, with respect to the annual information only, a report
thereon by the Company's certified independent accountants, in each case, as
required by the rules and regulations of the SEC as in effect on the Issuance
Date.
Section 4.03 Compliance Certificate.
The Company shall deliver to the Trustee, within 90 days after the end of
each fiscal year of the Company, an Officers' Certificate stating that a review
of the activities of the Company and its Subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officers with a
view to determining whether the Company has kept, observed, performed and
fulfilled its obligations under, and complied with the covenants and conditions
contained in, this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his knowledge the Company has
kept, observed, performed and fulfilled each and every covenant, and complied
with the covenants and conditions contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions and
conditions hereof (or, if a Default or Event of Default shall have occurred,
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describing all such Defaults or Events of Default of which he may have
knowledge) and that to the best of his knowledge no event has occurred and
remains in existence by reason of which payments on account of the aggregate
Accreted Value on the Notes are prohibited.
One of the Officers signing such Officers' Certificates shall be either the
Company's principal executive officer, principal financial officer or principal
accounting officer.
The Company will, so long as any of the Notes are outstanding, deliver to
the Trustee, forthwith upon becoming aware of any Default or Event of Default or
any failure to observe or perform any covenant or agreement contained herein for
which an obligation to accrue additional interest under Section 7.12 may arise,
an Officers' Certificate specifying such Default or Event of Default or such
failure.
Section 4.04 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not, by resort to any such law, hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 4.05 Corporate Existence.
Subject to Article V hereof, to the extent permitted by law, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate, partnership or other
existence of each Subsidiary of the Company in accordance with the respective
organizational documents of each Subsidiary and the rights (charter and
statutory), licenses and franchises of the Company; provided, however, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any Subsidiary, if the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries taken as a whole.
Section 4.06 Restricted Payments.
The Company shall not, directly or indirectly, (i) pay any dividend on, or
make any distribution to holders of, any shares of the Company's Capital Stock
(other than dividends or distributions payable solely in shares of its Qualified
Capital Stock or in options, warrants or other rights to acquire shares of such
Qualified Capital Stock and other than the accretion of dividends on the
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Company's 12% Series C-1 Convertible Participating Preferred Stock and 15%
Series C-2 Preferred Stock); or (ii) purchase, redeem, defease or otherwise
acquire or retire for value, directly or indirectly, the Company's Capital Stock
or options, warrants or other rights to acquire such Capital Stock. The
foregoing provisions shall not prohibit (x) the purchase, repurchase,
redemption, or other acquisition or retirement for value of any shares of any
class of Capital Stock of the Company in exchange for other shares of Qualified
Capital Stock of the Company and (y) the purchase, redemption, acquisition or
retirement for value of shares of the Company's Capital Stock or options,
warrants or other rights to acquire such Capital Stock so long as (i) the
amounts paid to purchase, redeem or acquire such securities does not exceed $5
million in the aggregate and (ii) no amount is paid to Oak Hill Capital
Partners, L.P., Oak Hill Securities Fund, L.P. or any of their Affiliates.
Section 4.07 Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of Notes shall
have the right to require the Company to repurchase all or any part of such
Holder's Notes (with Accreted Value with $100 of Original Issue Price or
integral multiples thereof), pursuant to an offer to all Holders of the Notes to
purchase Notes (the "PURCHASE OFFER") at a purchase price equal to the Accreted
Value of such Notes plus accrued and unpaid interest to the date of purchase
(the "CHANGE OF CONTROL PAYMENT").
(b) The Purchase Offer shall remain open for a period specified by the
Company which shall be no less than 30 calendar days and no more than 40
calendar days following its commencement (the "COMMENCEMENT DATE") (as
determined in accordance with this Section 4.07 hereof), except to the extent
that a longer period is required by applicable law (the "TENDER PERIOD"). Upon
the expiration of the Tender Period (the "PURCHASE DATE"), the Company shall
irrevocably deposit with the Paying Agent an amount in immediately available
funds sufficient to pay the aggregate Change of Control Payment for all the
Notes required to be purchased pursuant to this Section 4.07 (the "OFFER
AMOUNT"), to be held for payment in accordance with the terms of this Section
4.07.
(c) The Company shall provide the Trustee with notice of the Purchase Offer
at least 10 days before the Commencement Date.
(d) Within 40 days following any Change of Control, the Company or the
Trustee (at the expense of the Company) shall send, by first class mail, a
notice to each of the Holders, which shall govern the terms of the Purchase
Offer and shall state:
(i) that the Purchase Offer is being made pursuant to which all Notes
validly tendered will be accepted for payment and the length of time the
Purchase Offer will remain open;
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(ii) the purchase price (as determined in accordance with Section
4.07(a) hereof) and the Purchase Date, and that all Notes tendered will be
accepted for payment;
(iii) that any Note or portion thereof not tendered or accepted for
payment will continue to accrue and accrete interest;
(iv) that, unless the Company defaults in the payment of the purchase
price, any Note or portion thereof accepted for payment pursuant to the
Purchase Offer will cease to accrue or accrete interest after the Purchase
Date;
(v) that Holders electing to have a Note or portion thereof purchased
pursuant to any Purchase Offer will be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, to the Paying Agent at the address specified in the
notice prior to the close of business on the third Business Day preceding
the Purchase Date;
(vi) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Purchase Date, or such longer period as may be
required by law, a letter or a telegram, telex or facsimile transmission
(receipt of which is confirmed and promptly followed by a letter) setting
forth the name of the Holder, the Accreted Value of the Note or portion
thereof the Holder delivered for purchase and a statement that such Holder
is withdrawing his election to have the Note or portion thereof purchased;
and
(vii) that Holders whose Notes were purchased only in part will be
issued new Notes equal in Accreted Value to the unpurchased portion of the
Notes surrendered.
(e) On the Purchase Date, the Company shall, to the extent lawful and
subject to Article V hereof, (i) accept for payment the Notes or portions
thereof properly tendered pursuant to the Purchase Offer, (ii) deliver or cause
the depositary or Paying Agent to deliver to the Trustee Notes so accepted and
(iii) deliver to the Trustee an Officers' Certificate stating such Notes or
portions thereof have been accepted for payment by the Company in accordance
with the terms of this Section 4.07. The Paying Agent shall promptly (but in any
case not later than ten (10) calendar days after the Purchase Date) mail or
deliver to each tendering Holder an amount equal to the purchase price of the
Notes tendered by such Holder and accepted by the Company for purchase, and the
Trustee shall promptly authenticate and mail or deliver to such Holders a new
Note equal in Accreted Value to any unpurchased portion of the Note surrendered.
Any Notes not so accepted shall be promptly mailed or delivered by or on behalf
of the Company to the Holder thereof.
(f) The Purchase Offer shall be made by the Company in compliance with all
applicable provisions of the Exchange Act, and all applicable tender offer rules
promulgated thereunder, and shall include all instructions and materials
necessary to enable such Holders to tender their Notes.
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(g) If and to the extent that a purchase of Notes required by this Section
4.07 is prohibited under the Bank Credit Agreements or the Subordinated
Convertible Notes Indenture, then notwithstanding any other provision of this
Section 4.07, such purchase shall not occur and be deferred until the first date
on which such purchase shall be permitted to be made under the terms of the Bank
Credit Agreements or the Subordinated Convertible Notes Indenture. Any Note that
is not purchased on a scheduled Purchase Date as otherwise contemplated by this
Section 4.07 shall continue to be outstanding and shall accrue interest until
such Note is purchased.
(h) The Company shall not be required to make a Purchase Offer if a third
party makes the Purchase Offer in the manner and at the times prescribed by, and
otherwise in compliance with the requirements set forth in, this Section 4.07
and purchases all Notes validly tendered and not withdrawn under such Purchase
Offer.
Section 4.08 Compliance with Laws.
The Company shall, and shall cause each of its Subsidiaries to, comply in
all respects with all laws, rules, regulations and governmental orders (whether
Federal, state or local) applicable to it and the operation of its businesses
whether now in effect or hereafter enacted if noncompliance with any such law,
rule, regulation or governmental order, either individually or in the aggregate,
would have a material adverse effect on (i) the business, assets, liabilities,
properties, operations, prospects or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or (ii) the ability of the
Company to perform its obligations in accordance with the terms hereof or of the
Notes.
Section 4.09 Taxes.
The Company shall, and shall cause each of its Subsidiaries to, pay prior
to delinquency all material taxes, assessments and governmental levies, except
as contested in good faith and by appropriate proceedings.
ARTICLE V
SUBORDINATION
Section 5.01 Agreement to Subordinate.
The Company, for itself and its successors, and each Holder of Notes by
accepting a Note agrees, that the Subordinated Obligations are subordinated in
right of payment, to the extent and in the manner provided in this Article, to
the prior payment in full in cash of all Obligations with respect to Senior Debt
of the Company (whether outstanding on the date hereof or hereafter created,
incurred, assumed or guaranteed), and that the subordination is for the benefit
of the holders of Senior Debt.
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Section 5.02 Liquidation; Dissolution, Bankruptcy.
Upon any distribution of cash, securities or other property to creditors of
the Company in a liquidation or dissolution of the Company or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property, in an assignment for the benefit of creditors or any
marshalling of the Company's assets and liabilities;
(a) holders of Senior Debt of the Company shall be entitled to receive
payment in full in cash of all Obligations due in respect of such Senior Debt
before Holders of the Notes shall be entitled to receive any payment with
respect to the Notes (except that, so long as the holders of Senior Debt do not
receive any equity securities in exchange for their Senior Debt, Holders may
receive securities that are subordinated to the Indebtedness or debt securities
received, or Senior Debt retained by the holders of the Senior Debt at least the
same extent as the Notes are subordinated to the Senior Debt of the Company);
and
(b) until all Obligations with respect to Senior Debt of the Company (as
provided in subsection (a) above) are paid in full in cash, any distribution to
which Holders of Notes would be entitled but for this Article shall be made to
holders of such Senior Debt (except that, so long as the holders of Senior Debt
do not receive any equity securities in exchange for their Senior Debt, Holders
may receive securities that are subordinated to the Indebtedness or debt
securities received, or Senior Debt retained by the holders of the Senior Debt
at least the same extent as the Notes to (i) Senior Debt of the Company and (ii)
any securities issued in exchange for Senior Debt of the Company), as their
interests may appear.
Section 5.03 Default on Senior Debt; No Stock Collateral.
The Company may not make any payment or distribution to the Trustee or any
Holder in respect of Obligations with respect to the Notes and may not acquire
from the Trustee or any Holder any Notes for cash or property (other than
securities that are subordinated to the Indebtedness or debt securities
received, or Senior Debt retained by the holders of the Senior Debt, at least
the same extent as the Notes to Senior Debt of the Company, so long as the
holders of Senior Debt do not receive any equity securities in exchange for
their Senior Debt) until all principal and other Obligations with respect to
such Senior Debt have been paid in full in cash if:
(1) a default in the payment of the principal of or premium or
interest on Senior Debt of the Company occurs and in continuing; or
(2) a default, other than a payment default, under the agreement,
indenture, or other document governing Designated Senior Debt occurs
and is continuing that permits holders of the Designated Senior Debt
as to which such default relates to accelerate its maturity and the
Trustee receives a notice of such default (a "PAYMENT BLOCKAGE
NOTICE") from a Senior Agent. If the Trustee receives any such Payment
Blockage Notice, no subsequent Payment Blockage Notice shall be
effective for purposes of this Section unless until at least 360 days
shall have elapsed since the effectiveness of the immediately prior
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Payment Blockage Notice. No nonpayment default that existed or was
continuing on the date of delivery of any Payment Blockage Notice to
the Trustee shall be, or made, the basis for a subsequent Payment
Blockage Notice.
The Company may and shall resume payments on and distributions in respect
of the Notes and it may acquire them upon:
(A) in the case of a default referred to in Section 5.03(1) hereof,
the date upon which such default is cured or waived, or
(B) in the case of a default referred to in Section 5.03(2) hereof,
the earlier of the date upon which the default is cured or waived or 179
days after the date on which the applicable Payment Blockage Notice is
received, unless the maturity of such Senior Debt has been accelerated,
if this Article otherwise permits the payment, distribution or acquisition
at the time of such payment or acquisition.
The Company agrees that it will not, directly or indirectly, transfer or
pledge or grant any security interests in any Stock Collateral for any of the
Subordinated Obligations, and the Trustee and the Holders agree that neither the
Trustee nor any Holder will demand or accept any such Stock Collateral, and
should any transfer or pledge of or security interest in any Stock Collateral at
any time be made to or received by the Trustee or any such Holder, such Stock
Collateral shall be held for the benefit of the holders of Senior Debt of the
Company and, upon request, delivered and transferred to the Senior Agent for the
benefit of the holders of such Senior Debt.
Section 5.04 Acceleration of Notes.
If payment of the Notes is accelerated because of an Event of Default, the
Company shall promptly notify holders of Senior Debt of the Company of the
acceleration.
Section 5.05 When Distribution Must Be Paid Over.
In the event that the Trustee or any Holder of Notes receives any payment
of any Obligations with respect to the Notes at a time when such payment is
prohibited by Section 5.03 hereof, such payment shall be held by the Trustee or
such Holder, in trust for the benefit of, and shall be paid forthwith over and
delivered, upon written request, to the holders of Senior Debt of the Company as
their interests may appear under the indenture or other agreement (if any)
pursuant to which such Senior Debt may have been issued, as their respective
interests may appear as set forth in a writing provided to the Trustee and
consented to by all Representatives of the holders of Senior Debt of the
Company, for application to the payment of all Obligations with respect to such
Senior Debt remaining unpaid to the extent necessary to pay such Obligations in
full in accordance with their terms, after giving affect to any concurrent
payment or distribution to or for the holders of such Senior Debt.
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With respect to the holders of Senior Debt of the Company, the trustee
undertakes to perform such obligations on the part of the Trustee as are
specifically set forth in this Article V, and no implied covenants or
obligations with respect to the holders of such Senior Debt shall be read into
this Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt of the Company, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Holders of Notes of the Company or any other Person money or assets to
which any holders of such Senior Debt shall be entitled by virtue of this
Article V, except if such payment is made at a time when a Responsible Officer
has actual knowledge that the terms of this Article V prohibit such payment.
Section 5.06 Notice.
The Company shall promptly notify the Trustee and the Paying Agent in
writing of any facts known to the Company that would cause a payment of any
Obligations with respect to the Notes to violate this Article, but failure to
give such notice shall not affect the subordination of the Notes to the Senior
Debt of the Company as provided in this Article V.
Section 5.07 Subrogation.
After all Senior Debt of the Company is paid in full in cash and until the
Notes are paid in full, Holders of Notes shall be subrogated (equally and
ratably with all other Indebtedness pari passu with the Notes) to the rights of
holders of such Senior Debt to receive distributions applicable to such Senior
Debt to the extent that distributions otherwise payable to the Holders have been
applied to the payment of such Senior Debt. A distribution made under this
Article V to holders of Senior Debt of the Company that otherwise would have
been made to Holders of Notes is not, as between the Company and Holders of
Notes, a payment by the Company on the Notes.
Section 5.08 Relative Rights.
This Article V defines the relative rights of Holders of Notes and holders
of Senior Debt of the Company. Nothing in this Indenture shall:
(i) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
Accreted Value of and premium and interest on the Notes in accordance with
their terms;
(ii) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of such Senior
Debt; or
(iii) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders of owners of such Senior Debt to receive distributions
and payments otherwise payable to Holders of Notes.
30
If the Company fails because of this Article V to pay Accreted Value of or
premium or interest on a Note on the due date, the failure is still a Default or
Event of Default.
Section 5.09 Subordination May Not Be Impaired by Company.
(a) No right of any holder of Senior Debt of the Company to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or any Holder or the failure of the
Company or any Holder to comply with this Indenture.
(b) Without in any way limiting Section 5.09(a), the holders of any Senior
Debt of the Company may, at any time and from time to time, without the consent
of or notice to any Holders, without incurring any liabilities to any Holder and
without impairing or releasing the subordination and other benefits provided in
this Indenture or the Holders' obligations to the holders of such Senior Debt,
even if any Holder's right of reimbursement or subrogation or other right or
remedy is affected, impaired or extinguished thereby, but subject to the second
sentence, of the definition of "Senior Debt," do any one or more of the
following: (i) amend, renew, exchange, extend, modify, increase or supplement in
any manner such Senior Debt or any instrument evidencing or guaranteeing or
securing such Senior Debt or any agreement under which such Senior Debt is
outstanding (including, but not limited to, changing the manner, place or terms
of payment or changing or extending the time of payment of, or renewing,
exchanging, amending, increasing, releasing, terminating or altering, (A) the
terms of such Senior Debt, (B) any security for, or any guarantee of, such
Senior Debt, (C) any liability of any obligor on such Senior Debt (including any
guarantor) or any liability incurred in respect of such Senior Debt); (ii) sell,
exchange, release, surrender, realize upon, enforce or otherwise deal with in
any manner and in any order any property pledged, mortgaged or otherwise
securing such Senior Debt or any liability of any obligor thereon, to such
holder, or any liability incurred in respect thereof; (iii) settle or compromise
any such Senior Debt or any other liability of any obligor of such Senior Debt
to such holder or any security therefor or any liability incurred in respect
thereof and apply any sums by whomsoever paid and however realized to any
liability (including, without limitation, payment of any Senior Debt) in any
manner or order; and (iv) release, terminate or otherwise cancel, or fail to
take or to record or otherwise perfect, for any reason or for no reason, any
lien or security interest securing such Senior Debt by whomsoever granted,
exercise or delay in or refrain from exercising any right or remedy against any
obligor or any guarantor or any other Person, elect any remedy and otherwise
deal freely with any obligor and any security for such Senior Debt or any
liability of any obligor to the holders of such Senior Debt or any liability
incurred in respect to such Senior Debt.
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Section 5.10 Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of
Senior Debt of the Company, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets of the Company referred to in
this Article V, the Trustee and the Holders of Notes shall be entitled, to rely
upon any order or decree made by any court of competent jurisdiction or upon any
certificate of such Representative or of the liquidating trustee or agent or
other Person making any distribution to the Trustee or to the Holders of Notes
for the purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of the Senior Debt and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article V.
Section 5.11 Rights of Trustee and Paying Agent.
Neither the Trustee nor any Paying Agent shall at any time be charged with
the knowledge of the existence of any facts that would prohibit the making of
any payment to or by the Trustee or Paying Agent under this Article V, unless
and until the Trustee or Paying Agent shall have received written notice thereof
from the Company, the Senior Agent, one or more holders of Senior Debt of the
Company or a Representative of any holders of Senior Debt of the Company; and,
prior to the receipt of any such written notice, the Trustee or Paying Agent
shall be entitled to assume conclusively that no such facts exist. The Trustee
shall be entitled to rely on the delivery to it of written notice by a Person
representing itself to be a holder of Senior Debt (or a Representative thereof)
to establish that such notice has been given. In the event that the Trustee or
Paying Agent determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Debt to participate in
any payment or distribution pursuant to this Article V, the Trustee or Paying
Agent may request such Person to furnish evidence to the reasonable satisfaction
of the Trustee or Paying Agent as to the amount of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article V, and if such evidence is not furnished, the Trustee
or Paying Agent may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment. Only the
Company, a Representative or a holder of Senior Debt of the Company that has no
Representative may give the notice. Nothing in this Article V shall impair the
claims of, or payments to, the Trustee under or pursuant to Section 8.07 hereof.
The Trustee in its individual or any other capacity may hold Senior Debt
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights.
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Section 5.12 Authorization to Effect Subordination.
Each Holder of Notes by the Holder's acceptance thereof authorizes and
directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article V, and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes. If the Trustee does not file a proper proof of claim
or proof of debt in the form required in any proceeding referred to in Section
7.09 hereof at least 30 days before the expiration of the time to file such
claim, a Senior Agent is hereby authorized to file an appropriate claim for and
on behalf of the Holders of the Notes.
Section 5.13 Payment.
For all purposes of this Article V, a "payment or distribution on account
of Subordinated Obligations" shall include, without limitation, any direct or
indirect payment or distribution on account of the purchase, prepayment,
redemption, retirement, defeasance or acquisition of any Note, any recovery by
the exercise of any right of set-off, any direct or indirect payment of
principal, premium or interest with respect to or in connection with any
mandatory or optional redemption or purchase provisions, any direct or indirect
payment or distribution payable or distributable by reason of any other
Indebtedness or Obligation being subordinated or any Subordinated Obligations,
and any direct or indirect payment or recovery on any claim relating to or
arising out of this Indenture, any Note or the issuance of the Notes.
Section 5.14 No Claims Against Subsidiaries.
The Company and the Holders acknowledge and agree as follows: (a) the Notes
are an obligation of the Company only, and the Holders have and will have no
claim, right or demand against any Subsidiary of the Company or any assets or
properties of any Subsidiary of the Company on or in respect of the Notes; (b)
the Company is, and is capitalized as, a separate legal entity such that any
claim, right or demand by the Holders with respect to the assets and properties
of any Subsidiary of the Company would be solely as a creditor of a direct or
indirect shareholder of such Subsidiary, and that such arrangement has been
relied upon by and is for the benefit of holders of Senior Debt of the Company
or any such guarantor; and (c) the Company's direct and indirect Subsidiaries
have no obligation to pay dividends to or to make investments in the Company,
for the purpose of funding payment obligations of the Company to the Holders or
otherwise.
Section 5.15 Amendments.
The provisions of this Article V shall not be amended or modified without
the written consent of the holders of all Senior Debt of the Company.
ARTICLE VI
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CONSOLIDATION, MERGER,
CONVEYANCE, TRANSFER OR LEASE
Section 6.01 Company May Consolidate, Etc. Only On Certain Terms.
The Company shall not, in a single transaction or through a series of
related transactions, consolidate with or merge with or into any other Person or
sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets to any Person or group of
affiliated Persons, or permit any of its Subsidiaries to enter into any such
transaction or transactions if such transaction or transactions, in the
aggregate, would result in a sale, assignment, conveyance, transfer, lease or
disposition of all or substantially all of the properties and assets of the
Company and its Subsidiaries on a consolidated basis to any other Person or
group of affiliated Persons, unless at the time and after giving effect thereto:
(a) either (i) the Company shall be the continuing corporation or (ii) the
Person (if other than the Company) formed by such consolidation or into which
the Company is merged or the Person which acquires by sale, assignment,
conveyance, transfer, lease or disposition all or substantially all of the
properties and assets of the Company and its Subsidiaries on a consolidated
basis (the "SURVIVING ENTITY") shall be a corporation, partnership, limited
liability company, business trust or other entity duly organized and validly
existing under the laws of the United States of America, any state thereof or
the District of Columbia and such Person expressly assumes, by a supplemental
indenture, executed and delivered to the Trustee, in a form satisfactory to the
Trustee, all the obligations of the Company under the Notes and this Indenture,
and this Indenture shall remain in full force and effect;
(b) immediately before and immediately after giving effect to such
transaction on a pro forma basis, no Default or Event of Default shall have
occurred and be continuing; and
(c) at the time of the transaction, the Company or the Surviving Entity
shall have delivered, or caused to be delivered, to the Trustee, in form and
substance reasonably satisfactory to the Trustee, an Officers' Certificate and
an Opinion of Counsel, each to the effect that such consolidation, merger,
transfer, sale, assignment, conveyance, transfer, lease or other transaction and
the supplemental indenture in respect thereof comply with this Indenture and
that all conditions precedent herein provided for relating to such transaction
have been complied with.
Paragraph (b) of this Section 6.01 shall not apply to any merger of the
Company with or into any wholly owned Subsidiary of the Company. This Section
6.01 shall not apply to the transfer or lease of all or substantially all of the
assets of the Company to any of its wholly owned Subsidiaries.
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Section 6.02 Successor Substituted.
Upon any consolidation or merger, or any sale, assignment, conveyance,
transfer, lease or disposition of all or substantially all of the properties and
assets of the Company in accordance with Section 6.01, the successor Person
formed by such consolidation or into which the Company is merged or the
successor Person to which such sale, assignment, conveyance, transfer, lease or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture and the Notes, with
the same effect as if such successor had been named as the Company herein or in
the Notes. When a successor (other than a successor that is an Affiliate of the
Company) assumes all the Obligations of its predecessor under this Indenture or
the Notes, as the case may be, the predecessor shall be released from those
Obligations; provided that in the case of a transfer of substantially all of the
Company's assets (but not all of the assets), the predecessor shall not be
released from the payment of the aggregate Accreted Value and any other payments
due on the Notes.
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.01 Events of Default.
An "EVENT OF DEFAULT" occurs if:
(a) the Company defaults in the payment of the aggregate Accreted Value of
or premium on the Notes when the same becomes due and payable at Maturity, in
connection with a Purchase Offer, upon declaration or otherwise (whether or not
such payment is prohibited by the provisions of Article V hereof);
(b) the Company defaults for 30 days in the payment when due of any other
amounts payable on any Note (whether or not such payment is prohibited by the
provisions of Article V hereof);
(c) the Company fails to observe or perform for a period of 30 days after
notice any covenant or agreement contained in Sections 4.07 and 6.01 hereof
(other than, in the case of Section 4.07, a failure to purchase Notes in
connection with a Purchase Offer);
(d) the Company fails to observe or perform any covenant or agreement
contained in Section 4.06 hereof;
(e) the Company pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case;
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(ii) consents to the entry of an order for relief against it in an
involuntary case;
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property; (iv) makes a general assignment for the
benefit of its creditors; or
(v) admits in writing its inability generally to pay its debts as they
become due; and
(f) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company in an involuntary case;
(ii) appoints a Custodian of the Company or for all or substantially
all of the property of the Company;
(iii) orders the liquidation of the Company and the order or decree
remains unstayed and in effect for 60 consecutive days.
The term "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors or the protection of creditors.
The term "CUSTODIAN" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
Section 7.02 Acceleration.
If an Event of Default (other than an Event of Default specified in clauses
(e) and (f) of Section 7.01 hereof) occurs and is continuing, the Trustee by
notice to the Company, or the Holders of at least 25% in aggregate Accreted
Value of the then outstanding Notes by notice to the Company and the Trustee,
may declare all the Notes to be due and payable. Upon such declaration, the
aggregate Accreted Value plus accrued and unpaid interest thereon, and any other
amounts payable on the Notes shall be due and payable immediately. If an Event
of Default specified in clauses (e) or (f) of Section 7.01 hereof occurs, such
amounts shall become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Holder.
Notwithstanding the foregoing, the Trustee and the Holders may not declare
the Notes to be due and payable under the first sentence of this Section 7.02
until five Business Days after receipt by the Senior Agent of written notice of
the acceleration of the Notes.
The Majority Holders by notice to the Trustee may rescind an acceleration
and its consequences (i) if the rescission would not conflict with any judgment
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or decree of a court of competent jurisdiction and (ii) if all existing Events
of Default have been cured or waived except nonpayment of Accreted Value or
interest on the Notes that has become due solely because of the acceleration of
the Notes.
Section 7.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the aggregate Accreted Value plus accrued and unpaid
interest thereon and any other amounts payable on the Notes, if any, or to
enforce the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.
Section 7.04 Waiver of Past Defaults.
The Majority Holders by notice to the Trustee may on behalf of all of the
Holders of the Notes waive an existing Default or Event of Default and its
consequences except a continuing Default or Event of Default in the payment of
the aggregate Accreted Value, accrued and unpaid interest thereon, and any other
amount payable on any Note, if any. When a Default or Event of Default is
waived, it is cured and ceases; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereon.
Section 7.05 Control by Majority.
The Majority Holders may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, is unduly prejudicial to
the rights of other Holders, or would involve the Trustee in personal liability.
Section 7.06 Limitation on Suits.
A Holder may pursue a remedy with respect to this Indenture or the Notes
only if:
(a) the Holder gives to the Trustee notice of a continuing Event of
Default;
(b) the Holders of at least 25% in aggregate Accreted Value of the then
outstanding Notes make a request to the Trustee to pursue the remedy;
(c) such Holder or Holders offer to the Trustee indemnity satisfactory to
the Trustee against any loss, liability or expense;
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(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Majority Holders do not give the Trustee
a direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
Section 7.07 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of the Accreted Value, accrued and unpaid
interest thereon, and other amounts payable on the Note, if any, on or after the
respective due dates expressed in the Note, or to bring suit for the enforcement
of any such payment on or after such respective dates, shall not be impaired or
affected without the consent of the Holder made pursuant to this Section 7.07.
Section 7.08 Collection Suit by Trustee.
If an Event of Default specified in Section 7.01(a) or (b) hereof occurs
and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of the
aggregate Accreted Value, accrued and unpaid interest thereon, remaining unpaid
on the Notes and interest on overdue Accreted Value and such further amounts as
shall be sufficient to cover the costs and, to the extent lawful, expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 7.09 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and the
Holders allowed in any judicial proceedings relative to the Company, its
creditors or its property. Nothing contained herein shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 7.10 Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 8.07 hereof;
Second: to the holders of Senior Debt to the extent required by Article V;
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Third: to Holders for amounts due and unpaid on the Notes for the Accreted
Value, accrued and unpaid interest thereon, and other amounts payable under the
Notes in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according to the
amounts due and payable on the Notes for the aggregate Accreted Value, accrued
and unpaid interest thereon, and other amounts, if any, respectively; and
Fourth: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders made pursuant to this Section 7.10.
Section 7.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 7.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
7.07 hereof, or a suit by Holders of more than 10% in aggregate Accreted Value
of the then outstanding Notes.
Section 7.12 Additional Interest.
If the Company fails to observe or perform any covenant or agreement
contained herein (other than any failure which may result in a Default or an
Event of Default as provided in Section 7.01 (a), (b), (c) and (d)) and such
failure continues for a period of 60 days after notice from the Trustee to the
Company or from Holders of at least 25% in aggregated Accreted Value of then
outstanding Notes to the Trustee and the Company (each, a "Non-default Covenant
Breach"), additional interest will accrue on the Notes over and above the rates
set forth in the Notes and this Indenture at a rate of 2% per annum for the
period immediately following the end of the 60 day cure period until such
failure is cured or waived; provided that the Company shall in no event be
required to pay any additional interest for more than one Non-default Covenant
Breach at any one time.
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ARTICLE VIII
TRUSTEE
Section 8.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default: (i) the Trustee
need perform only those duties that are specifically set forth in this Indenture
and no others and (ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture and to confirm the
correctness of all mathematical computations.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that: (i) this subsection does not limit the effect of subsection (b) of this
Section 8.01; (ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts and (iii) the Trustee
shall not be liable with respect to any action it takes or omits to take in good
faith in accordance with a direction received by it pursuant to Section 7.05
hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section 8.01.
(e) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 8.02 Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and
to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
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(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for the
misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee shall not be charged with knowledge of any Event of Default
under subsection (c), (d), (e) or (f) (and subsection (a) or (b) if the Trustee
does not act as Paying Agent) of Section 7.01 unless either (i) a Responsible
Officer shall have actual knowledge thereof, or (ii) the Trustee shall have
received notice thereof in accordance with Section 11.02 hereof from the Company
or any Holder.
Section 8.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or an Affiliate with
the same rights it would have if it were not Trustee. Any Agent may do the same
with like rights. However, subject to the exceptions set forth therein, the
Trustee is subject to Sections 8.10 and 8.11 hereof.
Section 8.04 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Notes, it shall not be accountable for the Company's use of the
proceeds from the Notes, and it shall not be responsible for any statement of
the Company in the Indenture or any statement in any Note other than its
authentication. Section 8.05......Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders a notice of the Default
or Event of Default within 90 days after it occurs. Except in the case of a
Default or Event of Default in payment on any Note, the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Holders.
Section 8.06 [Intentionally Omitted]
Section 8.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services hereunder. The Trustee's compensation shall not be
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limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Trustee upon request for all reasonable disbursements,
expenses and advances incurred or made by it. Such disbursements and expenses
may include the reasonable disbursements, compensation and expenses of the
Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it except as set forth in the next paragraph. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity. The
Company shall defend the claim and the Trustee shall cooperate in the defense.
The Trustee may have separate counsel and the Company shall pay the reasonable
fees, disbursements and expenses of such counsel. The Company need not pay for
any settlement made without its consent, which consent shall not be unreasonably
withheld.
The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee through negligence or bad faith.
To secure the Company's payment obligations in this Section 8.07, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, except money or property held in trust to pay Accreted
Value and interest on particular Notes.
Without prejudice to any other rights available to the Trustee under
applicable law, when the Trustee incurs expenses or renders services after an
Event of Default specified in Section 7.01(g) or (h) hereof occurs, the expenses
and the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
All amounts owing to the Trustee under this Section 8.07 shall be payable
by the Company in United States dollars. This Section 8.07 shall not apply so
long as Madeleine LLC or any of its Affiliates is the Trustee.
Section 8.08 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 8.08.
The Trustee may resign by so notifying the Company. The Majority Holders
may remove the Trustee by so notifying the Trustee and the Company. If Madeleine
LLC or any of its Affiliates is not the Trustee, the Company may remove the
Trustee if:
(a) the Trustee fails to comply with Section 8.10 hereof,;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
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(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Majority
Holders may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% of the aggregate Accreted Value of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 8.10 hereof, any Holder who has
been a bona fide Holder of a Note for at least six months may petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of
a successor Trustee; provided, that the foregoing shall not apply if the Trustee
is Madeleine LLC or any of its Affiliates.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Holders. The retiring
Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided for in Section 8.07 hereof.
Notwithstanding replacement of the Trustee pursuant to this Section 8.08 hereof,
the Company's obligations under Section 8.07 hereof shall continue for the
benefit of the retiring trustee with respect to expenses and liabilities
incurred by it prior to such replacement.
Section 8.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 8.10 Eligibility; Disqualification.
Except for Madeleine LLC or any of its Affiliates is acting as Trustee, the
Trustee shall always have a combined capital and surplus of at least
$100,000,000 as set forth in its most recent published annual report of
condition.
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Section 8.11 Preferential Collection of Claims Against Company.
If the Trustee shall be, or shall become, a creditor, directly or
indirectly, secured or unsecured, of the Company, within three months prior to a
Default, or subsequent to such a Default, then, unless and until such Default
shall be cured, the Trustee shall set apart and hold in a special account for
the benefit of the Trustee individually and the Holders:
(a) an amount equal to any and all reductions in the amount due and owing
upon any claim as such creditor in respect of principal or interest, effected
after the beginning of such three months' period and valid as against the
Company and its other creditors, except any such reduction resulting from the
receipt or disposition of any property described in paragraph (b) below, or from
the exercise of any right of setoff which the Trustee could have exercised if a
petition in bankruptcy had been filed by or against the Company upon the date of
such Default; and
(b) all property received in respect of any claim as such creditor, either
as security therefor, or in satisfaction or composition thereof, or otherwise,
after the beginning of such three months' period, or an amount equal to the
proceeds of any such property, if disposed of, subject, however, to the rights,
if any, of the Company and its other creditors in such property or such
proceeds.
This Section 8.11 shall not apply if Madeleine LLC or any of its Affiliates
is acting as Trustee.
ARTICLE IX
DISCHARGE OF INDENTURE
Section 9.01 Termination of Company's Obligations.
This Indenture shall cease to be of further effect (except that the
Company's obligations under Sections 8.07 and 9.02 hereof shall survive) when
all outstanding Notes theretofore authenticated and issued have been delivered
to the Trustee for cancellation and the Company has paid all sums payable
hereunder.
Section 9.02 Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the Company upon
request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon request any
money held by them for the payment of Accreted Value or interest that remains
unclaimed for two years after the date upon which such payment shall have become
due; provided, however, that the Company shall have first caused notice of such
payment to the Company to be mailed to each Holder entitled thereto no less than
30 days prior to such payment. After payment to the Company, the Trustee and the
Paying Agent shall have no further liability with respect to such money and
Holders entitled to the money must look to the Company for payment as general
creditors unless any applicable abandoned property law designates another
Person.
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ARTICLE X
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 10.01 Without Consent of Holders.
The Company and the Trustee may amend or supplement this Indenture or the
Notes without the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to comply with Sections 5.12 and 6.01 hereof;
(c) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(d) to make any change that provides additional rights or benefits to the
Holders of the Notes; or
(e) to make any change that does not adversely affect the interests
hereunder of any Holder.
Section 10.02 With Consent of Holders.
Subject to Section 7.07 hereof, the Company and the Trustee may amend or
supplement this Indenture or the Notes with the written consent of the Majority
Holders. Subject to Sections 7.04 and 7.07 hereof, the Majority Holders may also
waive compliance in a particular instance by the Company with any provision of
this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment, supplement or waiver under this Section 10.02 may not:
(a) reduce the percentage in aggregate Accreted Value of the then
outstanding Notes the consent of whose Holders is required for any amendment,
supplement to this Indenture or waiver of any provision of this Indenture;
(b) change the Stated Maturity of the Accreted Value of any Note or alter
the Accreted Value thereof or any amounts payable thereon under this Indenture,
if any;
(c) reduce the rate of or change the time for payment of interest on any
Note;
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(d) waive a default in the payment of the Accreted Value or any other
amounts payable on any Note, if any, or impair the right to institute suit for
the enforcement of any such payment on or after the Maturity thereof, except a
rescission of acceleration of the Notes by the Majority Holders and a waiver of
the payment default that resulted from such acceleration;
(e) make any Note payable in money other than that stated in the Note;
(f) make any change in Sections 7.04 or 7.07 hereof;
(g) modify Article V in a manner adverse to the Holders of Notes;
(h) except as provided by Article VI, consent to the assignment or transfer
by the Company of any of its rights and obligations under the Indenture; and
(i) make any change in the foregoing amendment and waiver provisions of
this Article X.
To secure a consent of the Holders under this Section 10.02, it shall not
be necessary for the Holders to approve the particular form of any proposed
amendment, supplement or waiver, but it shall be sufficient if such consent
approves the substance thereof.
After an amendment, supplement or waiver under this Section 10.02 becomes
effective, the Company shall mail to Holders a notice briefly describing the
amendment or waiver.
Section 10.03 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder or subsequent Holder may revoke the consent as to
his Note or portion of a Note if the Trustee receives the notice of revocation
before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite Accreted Value of Notes have
consented to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such amendment, supplement or waiver or
to revoke any consent previously given, whether or not such Persons continue to
be Holders after such record date. No consent shall be valid or effective for
more than 90 days after such record date unless consents from Holders of the
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Accreted Value of Notes required hereunder for such amendment or waiver to be
effective shall have also been given and not revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective it shall bind every
Holder, unless it is of the type described in any of clauses (a) through (i) of
Section 10.02 hereof. In such case, the amendment or waiver shall bind each
Holder who has consented to it and every subsequent Holder that evidences the
same debt as the consenting Holder's Note.
Section 10.04 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment or waiver
on any Note thereafter authenticated. The Company in exchange for all Notes may
issue and the Trustee shall authenticate new Notes that reflect the amendment or
waiver.
Failure to make such notation on a Note or to issue a new Note as aforesaid
shall not affect the validity and effect of such amendment or waiver.
Section 10.05 Trustee Protected.
The Trustee shall sign all supplemental indentures, except that the Trustee
may, but need not, sign any supplemental indenture that adversely affects its
rights.
ARTICLE XI
MISCELLANEOUS
Section 11.01 [Intentionally Omitted]
Section 11.02 Notices.
Any notice or communication by the Company or the Trustee to the other is
duly given if in writing and delivered in Person or mailed by first class mail
to the other's address stated in this section. The Company or the Trustee by
notice to the other may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication to a Holder shall be mailed by first class mail
to his address shown on the register kept by the Registrar. Failure to mail a
notice or communication to a Holder or any defect in it shall not affect its
sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
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All other notices or communications shall be in writing.
In case by reason of the suspension of regular mail service, or by reason
of any other cause, it shall be impossible to mail any notice as required by the
Indenture, then such method of notification as shall be made with the approval
of the Trustee shall constitute a sufficient mailing of such notice.
The address of the Company's executive office is:
American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Telecopy: (435) 615 0340
Attention: Chief Financial Officer
with a copy to:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
and a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019
Telecopy: (212) 373-2377
Attention: John C. Kennedy, Esq.
The Trustee's address is:
Madeleine LLC
299 Park Avenue
New York, NY 10171
Attention: Mark A. Neporent
with a copy to:
Stuart D. Freedman, Esq.
Schulte Roth & Zabel LLP
919 Third Avenue
New York, NY 10022
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Section 11.03 Communication by Holders with other Holders.
Holders may communicate with other Holders with respect to their rights
under this Indenture or the Notes and may have access to information held by the
Trustee. The disclosure of any such information as to the names and addresses of
the Holders by the Trustee or the Company is hereby authorized and permitted and
the Trustee or Company shall not be held accountable by reason of mailing any
material pursuant to a request made by the Holders.
Section 11.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such counsel, all
such conditions precedent have been complied with.
Section 11.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than pursuant to Section 4.03)
shall include:
(a) a statement that the Person signing such certificate or rendering such
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, such Person has made
such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been complied with.
Section 11.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by, or a meeting of,
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
49
Section 11.07 Legal Holidays.
A "LEGAL HOLIDAY" is a Saturday, a Sunday or a day on which banking
institutions in the State of New York are not required to be open. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period. If any other operative date for purposes of
this Indenture shall occur on a Legal Holiday then for all purposes the next
succeeding day that is not a Legal Holiday shall be such operative date.
Section 11.08 No Recourse Against Others.
A director, officer, employee, incorporator or shareholder of the Company,
as such, shall not have any liability for any Obligations of the Company under
the Notes or this Indenture or for any claim based on, in respect of or by
reason of such Obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Notes.
Se ction 11.09 Counterparts and Facsimile Signatures.
This Indenture may be executed by manual or facsimile signature in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
Section 11.10 Governing Law, Submission to Jurisdiction.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND
THE NOTES, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
Section 11.11 No Adverse Interpretation of other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or an Affiliate. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 11.12 Successors.
All agreements of the Company in this Indenture and the Notes shall bind
its successor. All agreements of the Trustee in this Indenture shall bind its
successor.
Section 11.13 Severability.
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
50
Section 11.14 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table, and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, all as of the date first written above.
AMERICAN SKIING COMPANY, as Company
By: /s/ Foster A Stewart, Jr
-----------------------------------------
Name: Foster A Stewart, Jr
Title: Senior Vice President
Madeleine LLC, as Trustee
By: /s/ Mark A Neporent
------------------------------------------------
Name: Mark A Neporent
Title: Vice President and Chief Operating Officer
EXHIBIT A
[FORM OF FACE OF NOTE]
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Notes Legend]
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE
SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE
SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a)
TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE, (c)
OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (d) TO AN ACCREDITED
INVESTOR (AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT)THAT, PRIOR
A-1
TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES (IN
SUBSTANTIALLY FORM OF EXHIBIT E OF THE INDENTURE) AND, IF SUCH TRANSFER IS
IN RESPECT OF AN ACCRETED VALUE WITH AN ORIGINAL ISSUE PRICE (AS DEFINED IN
THE TERMS OF NOTES) LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT OR
(e) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY
SO REQUESTS), (2) TO THE COMPANY OR ANY SUBSIDIARY THEREOF OR (3) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
ANY OTHER APPLICABLE JURISDICTION AND (B) THE PURCHASER WILL, AND EACH
SUBSEQUENT PURCHASER IS REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER FROM
IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN
(A) ABOVE.
A-2
No. ________
$76,673,300 Original Issue Price
or such other amount as is indicated on Schedule A hereof*
CUSIP No. [ ]/CINS No. [ ]**
JUNIOR SUBORDINATED NOTE DUE 2012
American Skiing Company, a Delaware corporation (the
"COMPANY"), promises to pay to Madeleine LLC or registered assigns, the Accreted
Value of this Note (as defined on the reverse hereof) on May 24, 2012, subject
to the further provisions of this Note set forth on the reverse hereof which
further provisions shall for all purposes have the same effect as if set forth
at this place.
Interest Accrual Dates: Each January 1, commencing January 1, 2005
IN WITNESS WHEREOF, American Skiing Company has caused this
Note to be signed manually or by facsimile by one of its duly authorized
officers.
Dated:
----------------------------
AMERICAN SKIING COMPANY
By:
--------------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Junior Subordinated Notes due
2012 described in the within-mentioned Indenture.
Madeleine LLC, as Trustee
By:
--------------------------------------
Authorized Officer
* Applicable to Global Notes Only
** To be included only if there is a CUSIP number
or CINS number for the Notes
A-3
[FORM OF REVERSE OF NOTE]
AMERICAN SKIING COMPANY
Junior Subordinated Note due 2012
1. Interest. American Skiing Company, a Delaware corporation (the
"COMPANY," which term includes any successor Person under the Indenture
hereinafter referred to), is the issuer of Junior Subordinated Notes due 2012
(the "NOTES"). The Company promises to pay the Accreted Value of this Note on
May 24, 2012. The Notes will accrue interest, compounded annually, as provided
in Section 2.02 of the Indenture on the Accreted Value of the Note, at a rate as
indicated below (subject to the increase as provided in Section 7.12 of the
Indenture):
Year Interest Rate
----------------- --------------
Remainder of 2004 11.25%
2005 11.25%
2006 11.25%
2007 11.75%
2008 12.50%
2009 12.50%
2010 12.75%
2011 13.00%
2012 13.00%
Interest on the Notes will accrue from November 24, 2004 and will be computed on
the basis of a 360-day year of twelve 30-day months. The "ACCRETED VALUE" of
this Note is defined as the sum of (i) the Original Issue Price of this Note,
and (ii) any interest or premium in respect to this Note added to each Accreted
Value pursuant to Section 2.02 of the Indenture and the terms of this Note.
2. Method of Payment. Interest on the Notes shall be payable through the
addition of such interest to the Accreted Value in effect immediately prior to
the applicable Interest Accrual Date. On the applicable Interest Accrual Date,
the Accreted Value shall increase by the amount of such interest. On maturity,
Holders must surrender Notes to a Paying Agent to collect the Accreted Value on
such Notes. The Company will pay the Accreted Value, accrued and unpaid interest
thereon, and premium, if any, in money of the United States that at the time of
payment is legal tender for payment of public and private debts. If a Holder so
requests, Accreted Value, accrued and unpaid interest thereon, and premium, if
any, may be paid by wire transfer of immediately available funds to an account
previously specified in writing by such Holder to the Company and the Trustee.
A-4
3. Paying Agent and Registrar. The Company will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without prior
notice. The Company or any of its Affiliates may act in any such capacity.
4. Indenture. The Company issued the Notes under the Indenture. The terms
of the Notes include those stated in the Indenture. The Notes are subject to,
and qualified by, all such terms, certain of which are summarized hereon, and
Holders are referred to the Indenture. The Notes are unsecured general
obligations of the Company limited (except as otherwise provided in the
Indenture) to $76,673,300 in aggregate Original Issue Price and subordinated in
right of payment to all existing and future Senior Debt of the Company.
5. Optional Redemption. At any time, the Notes are subject to redemption at
the option of the Company, in whole or in part, upon not less than 30 nor more
than 60 days' notice, at a redemption price equal to the Accreted Value of such
Notes plus accrued and unpaid interest thereon to the applicable redemption
date.
Notice of redemption will be mailed at least 30 but not more than 60 days
before the redemption date to each Holder of the Notes to be redeemed at his
address of record. The Company may redeem Notes in whole or in part in
denominations of Accreted Value with $100 of Original Issue Price or integral
multiples thereof. In the event of a redemption of less than all of the Notes,
the Notes will be chosen for redemption by the Trustee in accordance with the
Indenture. On and after the redemption date, interest ceases to accrue on the
Notes or portions of them called for redemption.
6. Mandatory Redemption. The Company will not be required to make mandatory
redemption or repurchase payments with respect to the Notes. There are no
sinking fund payments with respect to the Notes.
7. Repurchase at Option of Holder. If there is a Change of Control, the
Company shall be required to offer to purchase all outstanding Notes on the
Purchase Date at the purchase price equal to the Accreted Value of such Notes,
plus accrued and unpaid interest thereon to the Purchase Date.
Holders of Notes that are subject to an offer to purchase will receive a
Change of Control offer from the Company prior to any related Purchase Date and
may elect to have such Notes or portions thereof in authorized denominations
purchased by completing the form entitled "Option of Holder to Elect Purchase"
appearing below.
8. Subordination. The payment of the Accreted Value, accrued and unpaid
interest thereon or any other amounts due on the Notes is subordinated in right
of payment to all existing and future Senior Debt of the Company, as described
in the Indenture. Each Holder, by accepting a Note, agrees to such subordination
and authorizes and directs the Trustee on its behalf to take such action as may
be necessary or appropriate to effectuate the subordination so provided and
appoints the Trustee as its attorney-in-fact for such purpose.
A-5
9. Denominations, Transfer, Exchange. The Notes are in registered form,
without coupons, in denominations of Accreted Value with $100 of Original Issue
Price and any integral multiples thereof. The transfer of Notes may be
registered, and Notes may be exchanged, as provided in the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture.
10. Persons Deemed Owners. The registered Holder of a Note may be treated
as its owner for all purposes.
11. Unclaimed Money. If money for the payment of Accreted Value or interest
remains unclaimed for two years, the Trustee and the Paying Agent shall pay the
money back to the Company at its written request. After that, Holders of Notes
entitled to the money must look to the Company for payment unless an abandoned
property law designates another Person and all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
12. Defaults and Remedies. The Notes shall have the Events of Default set
forth in Section 7.01 of the Indenture. Subject to certain limitations in the
Indenture, if an Event of Default occurs and is continuing, the Trustee by
notice to the Company or the Holders of at least 25% in aggregate Accreted Value
of the then outstanding Notes by notice to the Company and the Trustee may
declare all the Notes to be due and payable immediately, except that in the case
of an Event of Default arising from certain events of bankruptcy or insolvency,
all unpaid Accreted Value, accrued and unpaid interest thereon and other amounts
payable on the Notes, if any, shall become due and payable immediately without
further action or notice. The Majority Holders by written notice to the Trustee
may rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of Accreted Value, and other amounts due
on the Notes, if any, that has become due solely because of the acceleration.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. Subject to certain limitations, the Majority may direct the Trustee
in its exercise of any trust or power. The Company must furnish annually
compliance certificates to the Trustee. The above description of Events of
Default and remedies is qualified by reference, and subject in its entirety, to
the more complete description thereof contained in the Indenture.
13. Amendments, Supplements and Waivers. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Majority Holders (including consents obtained in connection with a tender offer
or exchange offer for Notes), and any existing default may be waived with the
consent of the Majority Holders. Without the consent of any Holder, the
Indenture or the Notes may be amended among other things, to cure any ambiguity,
defect or inconsistency, to provide for uncertificated Notes in addition to or
in place of certificated Notes, to provide for assumption of the Company's
obligations to Holders or to make any change that does not adversely affect the
rights of any Holder.
A-6
14. Trustee Dealings with the Company. The Trustee, in its individual or
any other capacity may become the owner or pledgee of the Notes and may
otherwise deal with the Company or an Affiliate with the same rights it would
have, as if it were not Trustee, subject to certain limitations provided for in
the Indenture. Any Agent may do the same with like rights.
15. No Recourse Against Others. A director, officer, employee, incorporator
or shareholder of the Company, as such, shall not have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. Each
Holder of the Notes by accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for the issue of the Notes.
16. Governing Law. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN
THE INDENTURE AND THE NOTES WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS
THEREOF.
17. Authentication. The Notes shall not be valid until authenticated by the
manual signature of an authorized officer of the Trustee or an authenticating
agent.
18. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and UGMA (= Uniform Gifts to
Minors Act).
The Company will furnish to any Holder of the Notes upon written request
and without charge a copy of the Indenture. Request may be made to:
American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Telecopy: (435) 615 0340
Attention: Chief Financial Officer
with a copy to:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
A-7
ASSIGNMENT FORM
To assign this Note, fill in the
form below:
(I) or (we) assign and transfer this Note to
(Insert assignee's social security or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint _________________________________ agent to
transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Your Signature:
-------------------------------
(Sign exactly as your name
appears on the other side of
this Note)
Date:
---------------
Signature Guarantee: *
---------------------------
In connection with any transfer of any of the Notes evidenced by this
certificate occurring prior to the date that is two years after the later of the
date of original issuance of such Notes and the last date, if any, on which such
Notes were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Notes are being transferred:
CHECK ONE BOX BELOW
(1) to the Company or any subsidiary thereof,
(2) to a qualified institutional buyer in compliance with Rule 144A,
(3) outside the United States in compliance with Rule 904 under the
Securities Act,
(4) pursuant to the exemption from registration provided by Rule 144 under
the Securities Act (if available),
(5) to an Accredited Investor (as defined in Regulation D under the
Securities Act) in a transaction exempt from registration under the
Securities Act,
(6) pursuant to any other exemption from registration under the Securities
Act or
A-8
(7) pursuant to an effective registration statement under the Securities
Act.
* Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange. However, such guarantee is not required so
long as a Purchaser holds the Note.
A-9
Signature
Signature Guarantee*
Signature must be guaranteed
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933, and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Date: _____________________
* Signature must be guaranteed by a commercial bank, trust company or member
firm of the New York Stock Exchange. However, such guarantee is not required so
long as a Purchaser holds the Note.
NOTICE: To be executed by an executive officer
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note or a portion thereof repurchased by
the Company pursuant to Section 4.07 of the Indenture, check the box: [ ]
If the purchase is in part, indicate the portion of Accreted Value with
Original Issue Price in denominations of $100 or any integral multiple thereof
to be purchased:
Your Signature:
--------------------------------------
(Sign exactly as your name appears on
the other side of this Note)
Date:
------------------
Signature Guarantee:**/
-------------------------------------
**/ Signature must be guaranteed by a
commercial bank, trust company or
member firm of the New York Stock
Exchange. However, this guarantee is
not required so long as a Purchaser
holds the Note.
A-11
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE A
SCHEDULE OF ORIGINAL ISSUE PRICE
The original issue price of this Global Note shall be $_______. The
following increases or decreases in the Original Issue Price (as defined in the
Indenture) of this Global Note have been made:
Amount of increase Signature of Date of exchange
Amount of decrease in in Original Issue Original Issue authorized officer following such
Original Issue Price Price of this Price of this of Trustee or Notes decrease or
of this Global Note Global Note Global Note Custodian increase
- ---------------------- ------------------- --------------- ------------------- ------------------
A-12
EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM RULE 144A GLOBAL NOTE OR RESTRICTED NOTE
TO REGULATION S GLOBAL NOTE
(Transfers pursuant to Section 2.07(a)(ii) or 2.07(a)(vii) of the Indenture)
[Name of Trustee]
as Trustee
[Address]
Attn:
Re: American Skiing Company Junior Subordinated
Notes due 2012 (the "NOTES")
Reference is hereby made to the Indenture, dated as of November 24, 2004
(the "INDENTURE"), between American Skiing Company, as Issuer, and Madeleine
LLC, as Trustee.
This letter relates to $[ ] [check one] (i) [ ] aggregate Accreted Value of
Notes which are held in the form of the Rule 144A Global Note (CUSIP No. ) with
the Depositary or (ii) [ ] Accreted Value of Restricted Note (CUSIP No. )
registered, in either case, in the name of [name of transferor] (the
"TRANSFEROR") to effect the transfer of the Notes in exchange for an equivalent
beneficial interest in the Regulation S Global Notes. The Original Issue Price
of such Notes is $________.
In connection with such request, the Transferor does hereby certify that
such transfer has been effected in accordance with (i) the transfer restrictions
set forth in the Notes and (ii) that:
(1) the offer of the Notes was not made to a Person in the United States;
(2) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither the Transferor nor any Person
acting on its behalf knows that the transaction was pre-arranged with a buyer in
the United States;
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the United States Securities Act of 1933, as
amended (the "SECURITIES ACT").
In addition, if the sale is made during a distribution compliance period
and the provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1) of Regulation S
are applicable thereto, we confirm that such sale has been made in accordance
with the applicable provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1), as
the case may be.
B-1
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Capitalized terms used in this
certificate and not otherwise defined in the Indenture have the meanings set
forth in Regulation S.
[Name of Transferor]
By:
__________________________
Name:
Title:
Dated:
-------------------
cc: American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Telecopy: (435) 615 0340
Attention: Chief Financial Officer
and:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
B-2
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM REGULATION S GLOBAL NOTE OR RESTRICTED NOTE
TO RULE 144A GLOBAL NOTE
(Transfers pursuant to Section 2.07(a)(iii) or 2.07(a)(vi) of the Indenture)
[Trustee]
as Trustee
[Address]
Attn:
Re: American Skiing Company Junior Subordinated
Notes due 2012 (the "NOTES")
Reference is hereby made to the Indenture, dated as of November 24, 2004
(the "INDENTURE"), between American Skiing Company, as Issuer, and Madeleine
LLC, as Trustee. Capitalized terms used but not defined herein shall have the
respective meanings given them in the Indenture.
This letter relates to $[ ] [check one] (i) [ ] aggregate Accreted Value of
Notes which are held in the form of the Regulation S Global Note (CUSIP No.
____) with the Depositary or (ii) [ ] Accreted Value of Restricted Note (CUSIP
No. ) registered, in each case, in the name of [name of transferor] (the
"TRANSFEROR") to effect the transfer of the Notes in exchange for an equivalent
beneficial interest in the Rule 144A Global Note. The Original Issue Price of
such Notes is $_____.
In connection with such request, and in respect of such Notes the
Transferor does hereby certify that such Notes are being transferred in
accordance with (i) the transfer restrictions set forth in the Notes and (ii)
Rule 144A under the United States Securities Act of 1933, as amended, to a
transferee that the Transferor reasonably believes is purchasing the Notes for
its own account or an account with respect to which the transferee exercises
sole investment discretion and the transferee and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in a
transaction meeting the requirements of Rule 144A and in accordance with
applicable securities laws of any state of the United States or any other
jurisdiction.
Dated: [Name of Transferor],
------------------------
By:
----------------------------
Name:
Title:
C-1
cc: American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Telecopy: (435) 615 0340
Attention: Chief Financial Officer
and:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
C-2
EXHIBIT D
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM GLOBAL NOTE OR RESTRICTED
NOTE TO RESTRICTED NOTE
(Transfers pursuant to Section 2.07(a)(iv) or Section 2.07(a)(v) of
the Indenture)
[Name of Trustee],
as Trustee
[Address]
Attn:
Re: American Skiing Company Junior Subordinated
Notes due 2012 (the "NOTES")
Reference is hereby made to the Indenture, dated as of November 24, 2004
(the "INDENTURE"), between American Skiing Company, as Issuer, and Madeleine
LLC, as Trustee. Capitalized terms used but not defined herein shall have the
respective meanings given them in the Indenture.
This letter relates to $[ ] aggregate Accreted Value of Notes which are
held [in the form of the [Rule 144A/Regulation S]. [Global] [Restricted] Note
(CUSIP No. [ ] CINS No. [ ]) [with the Depositary] in the name of [name of
transferor] (the "TRANSFEROR") to effect the transfer of the Notes. The Original
Issue Price of such Notes is $_________.
D-1
In connection with such request, and in respect of such Notes, the
Transferor does hereby certify that such Notes are being transferred (i) in
accordance with the transfer restrictions set forth in the Notes and (ii) in
accordance with applicable securities laws of any state of the United States or
any other jurisdiction.
*Insert, if appropriate.
[Name of Transferor],
By:
----------------------------------
Name:
Title:
Dated:
-------------------
cc: American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Telecopy: (435) 615 0340
Attention: Chief Financial Officer
and:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
D-2
APPENDIX E
FORM OF LETTER TO BE DELIVERED BY INVESTORS OR OTHER PERSONS IN A
TRANSACTION EXEMPT FROM REGISTRATION
American Skiing Company
P. O. Box 4552
136 Heber Ave.
Park City, UT 84060
Ladies and Gentlemen:
We are delivering this letter in connection with our acquisition of Junior
Subordinated Notes due 2012 (the "Notes") of American Skiing Company, a Delaware
corporation (the "Company").
We hereby confirm that:
[(i) we are an "accredited investor" within the meaning of Rule 501 (a)
(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act"), or an entity in which all of the equity owners are accredited
investors within the meaning of Rule 501 (a) (1), (2), (3) or (7) under the
Securities Act (an "Institutional Accredited Investor");]
[(ii) (A) any purchase of the Notes by us will be for our own account or
for the account of one or more other Institutional Accredited Investors or as
fiduciary for the account of one or more trusts, each of which is an "accredited
investor" within the meaning of Rule 501 (a) (7) under the Securities Act and
for each of which we exercise sole investment discretion or (B) we are a "bank,"
within the meaning of Section 3 (a) (2) of the Securities Act, or a "savings and
loan association" or other institution described in Section 3 (a) (5) (A) of the
Securities Act that is acquiring the Notes as fiduciary for the account of one
or more institutions for which we exercise sole investment discretion;]
(iii) in the event that we purchase any of the Notes, we will acquire Notes
having a minimum Original Issue Price of not less than $250,000 for our own
account or for any separate account for which we are acting;
(iv) we have such knowledge and experience in financial and business
matters that we are capable of evaluating the merits and risks of purchasing the
Notes;
(v) we are not acquiring the Notes with a view to distribution thereof or
with any present intention of offering or selling any of the Notes, except
pursuant to an effective registration statement under the Securities Act or
pursuant to an exemption from the registration requirements thereof, as provided
below, provided that the disposition of our property and the property of any
accounts for which we are acting as fiduciary shall remain at all times within
our control; and
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(vi) we acknowledge that we have had access to such financial and other
information, and have been afforded the opportunity to ask such questions of
representatives of the Company and receive answers thereto, as we deem necessary
in connection with our decision to acquire the Notes.
We understand that the Notes are being offered in a transaction not
involving any public offering within the United States within the meaning of the
Securities Act and that the Notes have not been registered under the Securities
Act, and we agree, on our own behalf and on behalf of each account for which we
acquire any Notes, that if in the future we decide to resell, pledge or
otherwise transfer such Notes, such Notes may be offered, resold, pledged or
otherwise transferred only: (a) to the Company or any of its subsidiaries, (b)
to a person whom the seller reasonably believes is a Qualified Institutional
Buyer or "QIB" (as defined in Rule 144A under the Securities Act) purchasing for
its own account or for the account of a QIB in a transaction meeting the
requirements of Rule 144A, (c) in an offshore transaction meeting the
requirements of Rule 904 of the Securities Act, (d) in a transaction meeting the
requirements of Rule 144 under the Securities Act, (e) to an Accredited Investor
that, prior to such transfer, furnishes the trustee a signed letter containing
certain representations and agreements relating to the transfer of the Notes (in
substantially this form) and, if such transfer is in respect of an Accreted
Value with an Original Issue Price (as defined in the terms of Notes) less than
$250,000, an opinion of counsel acceptable to the Company that such transfer is
in compliance with the Securities Act, (f) in accordance with another exemption
from the registration requirements of the Securities Act (and based upon an
opinion of counsel acceptable to the Company) or (g) pursuant to an effective
registration statement and, in each case, in accordance with the applicable
securities laws of any state of the United States, or any other applicable
jurisdiction. We understand that the registrar and transfer agent for the Notes
will not be required to accept for registration of transfer any Notes acquired
by us, except upon presentation of evidence satisfactory to the Company and the
transfer agent that the foregoing restrictions on transfer have been complied
with. We further understand that any Notes acquired by us will be in the form of
definitive physical certificates and will bear a legend reflecting the substance
of this paragraph.
We acknowledge that the Company and others will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
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THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.
Dated:
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(Name of Purchaser)
By:
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Name:
Title:
Address:
cc:
American Skiing Company
One Monument Way
Portland, ME 04101
Attention: Foster Stewart
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