1
Exhibit 4.7
------------------------
BLUEGREEN CORPORATION
as Issuer,
CERTAIN OF ITS SUBSIDIARIES SPECIFIED HEREIN
as Subsidiary Guarantors
and
SUNTRUST BANK, CENTRAL FLORIDA, NATIONAL ASSOCIATION
as Notes Trustee
------------------------
$110,000,000
10 1/2% SENIOR SECURED NOTES DUE 2008
------------------------
INDENTURE
Dated as of April 1, 1998
------------------------
2
CROSS-REFERENCES TO CERTAIN SECTIONS OF THIS INDENTURE RELATING TO
SECTIONS 310 THROUGH 318 OF THE TRUST INDENTURE ACT OF 1939
TRUST INDENTURE
ACT SECTION INDENTURE SECTION(S)
--------------- --------------------
Section 310(a)(1)................................................................................................7.10
(a)(2)................................................................................................7.10
(a)(3).................................................................................................N/A
(a)(4).................................................................................................N/A
(a)(5)................................................................................................7.10
(b)...................................................................................................7.10
(c)....................................................................................................N/A
Section 311(a)...................................................................................................7.11
(b)...................................................................................................7.11
(c)....................................................................................................N/A
Section 312(a)...................................................................................................2.05
(b)..................................................................................................12.03
(c)..................................................................................................12.03
Section 313(a).............................................................................................7.05, 7.06
(b)...................................................................................................7.06
(c)...................................................................................................7.06
(d)...................................................................................................7.06
Section 314(a)......................................................................................4.03, 4.04, 12.05
(b)..................................................................................................11.07
(c)(1)...............................................................................................11.03
(c)(2)...............................................................................................11.03
(c)(3).................................................................................................N/A
(d)..................................................................................................11.03
(e)..................................................................................................12.05
(f)...................................................................................................4.19
Section 315(a)...................................................................................................7.02
(b)...................................................................................................7.05
(c)...................................................................................................7.01
(d)...................................................................................................7.01
(e)...................................................................................................6.11
Section 316(a)(1)..........................................................................................6.04, 6.05
(a)(2).................................................................................................N/A
(b).............................................................................................6.07, 9.02
(c)...................................................................................................2.19
Section 317(a).............................................................................................6.08, 6.09
(b)...................................................................................................2.04
* This table is not, and shall not be deemed for any purpose to be, a part of
the Indenture. "N/A" means not applicable.
-i-
3
TABLE OF CONTENTS
PAGE
----
ARTICLE 1: DEFINITIONS AND INCORPORATION BY REFERENCE....................................................1
Section 1.01. Definitions..........................................................................1
Section 1.02. Other Definitions...................................................................21
Section 1.03. Incorporation by Reference of Trust Indenture Act...................................23
Section 1.04. Rules of Construction...............................................................23
ARTICLE 2: THE NOTES....................................................................................23
Section 2.01. Form and Dating.....................................................................23
Section 2.02. Execution and Authentication........................................................24
Section 2.03. Registrar and Paying Agent..........................................................25
Section 2.04. Paying Agent to Hold Money in Trust.................................................25
Section 2.05. Noteholder Lists....................................................................26
Section 2.06. Transfer and Exchange...............................................................26
Section 2.07. Replacement Notes...................................................................27
Section 2.08. Outstanding Notes...................................................................27
Section 2.09. Treasury Notes......................................................................28
Section 2.10. Temporary Notes.....................................................................28
Section 2.11. Cancellation........................................................................28
Section 2.12. Defaulted Interest..................................................................28
Section 2.13. CUSIP Number........................................................................29
Section 2.14. Deposit of Moneys...................................................................29
Section 2.15. Restrictive Legends.................................................................29
Section 2.16. Book-Entry Provisions for Global Note...............................................31
Section 2.17. Special Transfer Provisions.........................................................32
Section 2.18. Persons Deemed Owners...............................................................34
Section 2.19. Record Date.........................................................................34
ARTICLE 3: REDEMPTION...................................................................................34
Section 3.01. Notices to Trustee..................................................................34
Section 3.02. Selection of Notes to be Redeemed...................................................35
Section 3.03. Notice of Redemption................................................................35
Section 3.04. Effect of Notice of Redemption......................................................36
Section 3.05. Deposit of Redemption Price.........................................................36
Section 3.06. Notes Redeemed in Part..............................................................37
Section 3.07. Optional Redemption.................................................................37
Section 3.08. Mandatory Redemption................................................................38
Section 3.09. Offer to Purchase by Application of Excess Proceeds.................................38
-ii-
4
PAGE
----
ARTICLE 4: COVENANTS....................................................................................40
Section 4.01. Payment of Notes....................................................................40
Section 4.02. Maintenance of Office or Agency.....................................................40
Section 4.03. SEC Reports.........................................................................41
Section 4.04. Compliance Certificates.............................................................42
Section 4.05. Taxes...............................................................................43
Section 4.06. Stay, Extension and Usury Laws......................................................43
Section 4.07. Limitation on Restricted Payments...................................................43
Section 4.08. Limitation on Restrictions on Distributions from Restricted
Subsidiaries......................................................................46
Section 4.09. Limitation on Indebtedness..........................................................47
Section 4.10. Limitation on Sales of Assets and Subsidiary Stock..................................51
Section 4.11. Limitation on Affiliate Transactions................................................52
Section 4.12. Limitation on Liens.................................................................53
Section 4.13. Corporate Existence.................................................................53
Section 4.14. Change of Control...................................................................54
Section 4.15. Limitation on Issuances of Capital Stock of Restricted Subsidiaries.................55
Section 4.16. Limitation on Repayment Upon a Change of Control....................................55
Section 4.17. Limitation on Sale/Leaseback Transactions...........................................56
Section 4.18. Limitation on Designations of Unrestricted Subsidiaries.............................56
Section 4.19. Further Instruments and Acts........................................................57
Section 4.20. Company to Cause Certain Subsidiaries to Become Guarantors..........................57
ARTICLE 5: SUCCESSORS...................................................................................58
Section 5.01. Limitations on Merger, Consolidation or Sale of Assets..............................58
Section 5.02. Successor Corporation Substituted...................................................59
ARTICLE 6: DEFAULTS AND REMEDIES........................................................................59
Section 6.01. Events of Default...................................................................59
Section 6.02. Acceleration........................................................................61
Section 6.03. Other Remedies......................................................................62
Section 6.04. Waiver of Past Defaults.............................................................62
Section 6.05. Control by Majority.................................................................62
Section 6.06. Limitation on Suits.................................................................63
Section 6.07. Rights of Noteholders to Receive Payment............................................63
Section 6.08. Collection Suit by Trustee..........................................................64
Section 6.09. Trustee May File Proofs of Claim....................................................64
Section 6.10. Priorities..........................................................................64
Section 6.11. Undertaking for Costs...............................................................65
-iii-
5
PAGE
----
ARTICLE 7: TRUSTEE......................................................................................65
Section 7.01. Duties of Trustee...................................................................65
Section 7.02. Rights of Trustee...................................................................67
Section 7.03. Individual Rights of Trustee........................................................68
Section 7.04. Trustee's Disclaimer................................................................68
Section 7.05. Notice of Defaults..................................................................68
Section 7.06. Reports by Trustee to Noteholders...................................................69
Section 7.07. Compensation and Indemnity..........................................................69
Section 7.08. Replacement of Trustee..............................................................70
Section 7.09. Successor Trustee by Merger, Etc. ..................................................71
Section 7.10. Eligibility; Disqualification.......................................................71
Section 7.11. Preferential Collection of Claims Against the Company...............................72
ARTICLE 8: DISCHARGE OF INDENTURE ......................................................................72
Section 8.01. Discharge of Liability on Note; Defeasance..........................................72
Section 8.02. Conditions to Defeasance............................................................73
Section 8.03. Application of Trust Money..........................................................75
Section 8.04. Repayment to the Company............................................................75
Section 8.05. Indemnity for Government Obligations................................................75
Section 8.06. Reinstatement.......................................................................75
ARTICLE 9: AMENDMENTS...................................................................................76
Section 9.01. Without Consent of Noteholders......................................................76
Section 9.02. With Consent of Noteholders.........................................................77
Section 9.03. Compliance with Trust Indenture Act.................................................79
Section 9.04. Revocation and Effect of Consents...................................................79
Section 9.05. Notation on or Exchange of Notes....................................................80
Section 9.06. Trustee to Sign Amendments, Etc.....................................................80
ARTICLE 10: SUBSIDIARY GUARANTEES OF NOTES...............................................................80
Section 10.01. Note Guarantee......................................................................80
Section 10.02. Execution and Delivery of Note Guarantee............................................82
Section 10.03. Note Guarantee Unconditional, Etc. ................................................82
Section 10.04. Limitation of Subsidiary Guarantor's Liability......................................83
Section 10.05. Contribution........................................................................83
Section 10.06. Release.............................................................................84
Section 10.07. Additional Subsidiary Guarantors....................................................84
Section 10.08. Subsidiary Guarantors May Consolidate, Etc. on Certain Terms........................84
-iv-
6
PAGE
----
Section 10.09. Successors and Assigns..............................................................85
Section 10.10. Waiver of Stay, Extension or Usury Laws.............................................85
ARTICLE 11: CREATION OF MORTGAGES........................................................................86
Section 11.01. Grant of Mortgages..................................................................86
Section 11.02. Delivery of Mortgages and Title Policies............................................86
Section 11.03. Partial Release of Pledged Properties...............................................87
Section 11.04. Delivery of Additional Documentation Required.......................................90
Section 11.05. Right to Inspect....................................................................90
Section 11.06. Compliance with the TIA.............................................................90
ARTICLE 12: MISCELLANEOUS................................................................................91
Section 12.01. Trust Indenture Act Controls........................................................91
Section 12.02. Notices.............................................................................91
Section 12.03. Communication by Noteholders with Other Noteholders.................................92
Section 12.04. Certificate and Opinion as to Conditions Precedent..................................92
Section 12.05. Statements Required in Certificate or Opinion.......................................92
Section 12.06. Rules by Trustee and Agents.........................................................93
Section 12.07. Legal Holidays......................................................................93
Section 12.08. No Recourse Against Others..........................................................93
Section 12.09. Duplicate Originals.................................................................94
Section 12.10. Governing Law.......................................................................94
Section 12.11. No Adverse Interpretation of Other Agreements.......................................94
Section 12.12. Successors..........................................................................94
Section 12.13. Severability........................................................................94
Section 12.14. Counterpart Originals...............................................................94
Section 12.15. Table of Contents, Headings, Etc. .................................................94
Exhibit A Form of Initial Note
Exhibit B Form of Exchange Note
Exhibit C Form of Certificate To Be Delivered in Connection with Transfers to Non-QIB
Accredited Investors
Exhibit D Form of Certificate To Be Delivered in Connection with Transfers Pursuant to
Regulation S
Exhibit E Escrow Letter
Exhibit F Alternative Escrow Letter
Schedule P Pledged Properties
-v-
7
INDENTURE, dated as of April 1, 1998, among Bluegreen Corporation, a
Massachusetts corporation (the "Company"), Bluegreen Resorts Management, Inc., a
Delaware corporation, Bluegreen Resorts, Inc., a Delaware corporation, Bluegreen
Holding Corporation (Texas), a Delaware corporation, Properties of Southwest
One, Inc., a Delaware corporation, Properties of the Southwest, L.P., a Delaware
limited partnership, Bluegreen Asset Management Corporation, a Delaware
corporation, Bluegreen Carolina Land, Inc., a Delaware corporation, Bluegreen
Corporation of Montana, a Montana corporation, Bluegreen Corporation of
Tennessee, a Delaware corporation, Bluegreen Corporation of the Rockies, a
Delaware corporation, Virginia Land & Forest Corporation, a Delaware
corporation, Bluegreen Communities, Inc., a Delaware corporation, Bluegreen
Resorts International, Inc., a Delaware corporation, Carolina National Golf
Club, Inc., a Delaware corporation, Leisure Capital Corporation, a Delaware
corporation, Properties of the West, Inc., a Delaware corporation, BG/RDI
Acquisition Corp., a Delaware corporation, RDI Group, Inc., a Florida
corporation, Dellona Enterprises, Inc., a Florida corporation, Resort
Development International, Inc., a Florida corporation, RDI Resort Services
Corporation, a Florida corporation, RDI Resources, Inc., a Florida corporation
(collectively, the "Subsidiary Guarantors"), and SunTrust Bank, Central Florida,
National Association, a national banking association, in its capacity as trustee
(the "Notes Trustee").
The Company has duly authorized the creation of an issue of 10 1/2%
Senior Secured Notes due 2008, Series A (the "Initial Notes") and 10 1/2% Senior
Secured Notes due 2008, Series B (the "Exchange Notes") and, to provide
therefor, the Company and the Subsidiary Guarantors have duly authorized the
execution and delivery of this Indenture. All things necessary to make the Notes
(as defined), when duly issued and executed by the Company, and authenticated
and delivered hereunder, the valid obligations of the Company and the Subsidiary
Guarantors have, and to make this Indenture a valid and binding agreement of the
Company and the Subsidiary Guarantors, have been done.
The Company, the Subsidiary Guarantors and the Notes Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders of the Notes:
ARTICLE 1: DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"Accounts Receivable" means collectively Mortgages Receivable and
Timeshare Interests Receivable."
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) in a Permitted Business; (ii) the Capital Stock
of a Person that becomes a Restricted Subsidiary as a result of the acquisition
of such Capital Stock by the Company or a Restricted Subsidiary of the Company;
(iii) Capital Stock constituting a minority interest in any Person that at such
time is a Restricted Subsidiary of the Company; or (iv) Permitted Investments of
the type and in the amounts described in clause (vii) of the definition thereof;
PROVIDED, HOWEVER, that, in
8
the case of clauses (ii) and (iii), such Restricted Subsidiary is primarily
engaged in a Permitted Business.
"Adjusted Net Assets" of a Subsidiary Guarantor at any date shall mean
the lesser of the amount by which (x) the fair value of the property of such
Subsidiary Guarantor exceeds the total amount of liabilities, including, without
limitation, the probable liability of such Subsidiary Guarantor with respect to
its contingent liabilities (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date), but excluding
liabilities under the Note Guarantee, of such Subsidiary Guarantor at such date
and (y) the present fair salable value of the assets of such Subsidiary
Guarantor at such date exceeds the amount that will be required to pay the
probable liability of such Subsidiary Guarantor on its debts (after giving
effect to all other fixed and contingent liabilities Incurred or assumed on such
date and after giving effect to any collection from any Subsidiary by such
Subsidiary Guarantor in respect of the obligations of such Subsidiary under the
Note Guarantee), excluding debt in respect of the Note Guarantees, as they
become absolute and matured.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Asset Disposition" means any sale, lease, transfer, issuance or other
disposition (or series of related sales, leases, transfers, issuances or
dispositions that are part of a common plan) of shares of Capital Stock of (or
any other equity interests in) a Restricted Subsidiary (other than directors'
qualifying shares and, to the extent required by local ownership laws in foreign
countries, shares owned by foreign shareholders) or of any other property or
other assets (each referred to for the purposes of this definition as a
"disposition") by the Company or any of its Restricted Subsidiaries (including
any disposition by means of a merger, consolidation or similar transaction)
other than (i) a disposition by a Restricted Subsidiary to the Company or by the
Company or a Restricted Subsidiary to a Wholly-Owned Subsidiary, (ii) sales or
other transfers in the ordinary course of business (including, without
limitation, bulk sales in the ordinary course of business consistent with past
practices), of Timeshare Interests, points in a points-based vacation club
system, Accounts Receivable (including, without limitation, direct sales to
financial institutions and sales or transfers in connection with securitization
transactions in the ordinary course of business) or Residential Lots or other
real property (including, without limitation, bulk sales in the ordinary course
of business consistent with past practices), (iii) a disposition of obsolete or
worn out equipment or equipment that is no longer useful in the conduct of the
business of the Company and its Restricted Subsidiaries and that is disposed of
in each case in the ordinary course of business, (iv) dispositions of property
for net proceeds which, when taken collectively with the net proceeds of any
other such dispositions under this clause
-2-
9
(iv) that were consummated since the beginning of the calendar year in which
such disposition is consummated, do not exceed $1.0 million, (v) transactions
permitted under Section 5.01 and (vi) Permitted Investments. Notwithstanding
anything to the contrary contained above, a Restricted Payment made in
compliance with Section 4.07 shall not constitute an Asset Disposition (except
for purposes of determinations of the Consolidated Coverage Ratio) to the extent
that such Restricted Payment as of the date made together with all other
Restricted Payments not constituting Asset Dispositions pursuant to this
sentence made subsequent to the Issue Date do not exceed, as of such date, 50%
of the amount calculated in accordance with Section 4.07(a)(3).
"Attributable Indebtedness" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate per annum equal to the discount rate which would be applicable to
a Capitalized Lease obligation with a like term in accordance with GAAP) of the
total obligations of the lessee for rental payments during the remaining term of
the lease included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the product of the numbers of years (rounded upwards to the nearest
month) from the date of determination to the dates of each successive scheduled
principal payment of such Indebtedness or redemption multiplied by the amount of
such payment by (ii) the sum of all such payments.
"Bankruptcy Code" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person or any committee of the Board of Directors of such
Person duly authorized, with respect to any particular matter, to exercise the
power of the Board of Directors of such Person.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Notes Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is required to
be classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP,
-3-
10
and the amount of Indebtedness represented by such obligation shall be the
capitalized amount of such obligation determined in accordance with GAAP, and
the Stated Maturity thereof shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date such lease may be
terminated without penalty.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully Guaranteed or insured by the United States
government or any agency or instrumentality thereof, (iii) certificates of
deposit, time deposits and Eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case with any commercial
bank having capital and surplus in excess of $500 million, (iv) repurchase
obligations for underlying securities of the types described in clauses (ii) and
(iii) entered into with any financial institution meeting the qualifications
specified in clause (iii) above, (v) commercial paper rated A-1 or the
equivalent thereof by Xxxxx'x or S&P and in each case maturing within one year
after the date of acquisition, (vi) investment funds investing 95% of their
assets in securities of the types described in clauses (i)-(v) above, and (vii)
readily marketable direct obligations issued by any state of the United States
of America or any political subdivision thereof having one of the two highest
rating categories obtainable from either Xxxxx'x or S&P.
"Change of Control" means (i) any sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Company and its Subsidiaries; or (ii) a
majority of the Board of Directors of the Company shall consist of Persons who
are not Continuing Directors of the Company; or (iii) the acquisition by any
Person or Group of the power, directly or indirectly, to vote or direct the
voting of securities having more than 50% of the ordinary voting power for the
election of directors of the Company or of any direct or indirect holding
company thereof.
"Commission" means the U.S. Securities and Exchange Commission or any
successor.
"Common Stock" means the common stock of the Company, par value $.01
per share.
"Company" means Bluegreen Corporation, a Massachusetts corporation,
until a successor replaces it in accordance with Article 5 hereof and thereafter
means the successor.
"Consolidated Cash Flow" for any period means the Consolidated Net
Income for such period, plus, without duplication, the following to the extent
deducted in calculating such Consolidated Net Income: (i) income tax expense,
(ii) Consolidated Interest Expense, (iii) depreciation expense, (iv)
amortization expense, and (v) all other non-cash items reducing Consolidated Net
Income (excluding any non-cash item to the extent it represents an accrual of or
reserve for cash disbursements for any subsequent period prior to the stated
maturity of the Notes) and less, (x) the aggregate amount of contingent and
"earnout" payments in respect of any Permitted Business acquired by the Company
or any Restricted Subsidiary that are paid in cash during such period and (y) to
the extent added in calculating Consolidated Net Income, non-cash items
(excluding such non-cash items to the extent they represent an accrual for cash
receipts
-4-
11
reasonably expected to be received prior to the Stated Maturity of the Notes),
in each case for such period. Notwithstanding the foregoing, the income tax
expense, depreciation expense and amortization expense of a Subsidiary of the
Company shall be included in Consolidated Cash Flow only to the extent (and in
the same proportion) that the net income of such Subsidiary was included in
calculating Consolidated Net Income.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of (i) the aggregate amount of Consolidated Cash Flow for the period of
the most recent four consecutive fiscal quarters ending prior to the date of
such determination and as to which financial statements are available to (ii)
Consolidated Interest Expense for such four fiscal quarters; PROVIDED, HOWEVER,
that (A) if the Company or any of its Restricted Subsidiaries has Incurred any
Indebtedness since the beginning of such period and through the date of
determination of the Consolidated Coverage Ratio that remains outstanding or if
the transaction giving rise to the need to calculate Consolidated Coverage Ratio
is an Incurrence of Indebtedness, or both, Consolidated Cash Flow and
Consolidated Interest Expense for such period shall be calculated after giving
effect on a pro forma basis to (1) such Indebtedness as if such Indebtedness had
been Incurred on the first day of such period (provided that if such
Indebtedness is Incurred under a revolving credit facility (or similar
arrangement or under any predecessor revolving credit or similar arrangement)
only that portion of such Indebtedness that constitutes the one year projected
average daily balance of such Indebtedness (as determined in good faith by the
Board of Directors of the Company) shall be deemed outstanding for purposes of
this calculation), and (2) the discharge of any other Indebtedness repaid,
repurchased, defeased or otherwise discharged with the proceeds of such new
Indebtedness as if such discharge had occurred on the first day of such period,
(B) if since the beginning of such period any Indebtedness of the Company or any
of its Restricted Subsidiaries has been repaid, repurchased, defeased or
otherwise discharged (other than Indebtedness under a revolving credit or
similar arrangement unless such revolving credit Indebtedness has been
permanently repaid and the underlying commitment terminated and has not been
replaced), Consolidated Interest Expense for such period shall be calculated
after giving pro forma effect thereto as if such Indebtedness had been repaid,
repurchased, defeased or otherwise discharged on the first day of such period,
(C) if since the beginning of such period the Company or any of its Restricted
Subsidiaries shall have made any Asset Disposition or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an Asset
Disposition, Consolidated Cash Flow for such period shall be reduced by an
amount equal to the Consolidated Cash Flow (if positive) attributable to the
assets which are the subject of all such Asset Dispositions for such period or
increased by an amount equal to the Consolidated Cash Flow (if negative)
attributable thereto for such period, and Consolidated Interest Expense for such
period shall be (i) reduced by an amount equal to the Consolidated Interest
Expense attributable to any Indebtedness of the Company or any of its Restricted
Subsidiaries repaid, repurchased, defeased or otherwise discharged with respect
to the Company and its continuing Restricted Subsidiaries in connection with all
such Asset Dispositions for such period (or, if the Capital Stock of any
Restricted Subsidiary of the Company is sold, the Consolidated Interest Expense
for such period directly attributable to the Indebtedness of such Restricted
Subsidiary to the extent the Company and its continuing Restricted Subsidiaries
are no longer liable for such Indebtedness after such sale) and (ii)
-5-
12
increased by interest income attributable to the assets which are the subject of
all such Asset Dispositions for such period, (D) if since the beginning of such
period the Company or any of its Restricted Subsidiaries (by merger or
otherwise) shall have made an Investment in any Restricted Subsidiary of the
Company (or any Person which becomes a Restricted Subsidiary of the Company as a
result thereof) or an acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder which constitutes all or
substantially all of an operating unit of a business, Consolidated Cash Flow and
Consolidated Interest Expense for such period shall be calculated after giving
pro forma effect thereto (including the incurrence of any Indebtedness) as if
such Investment or acquisition occurred on the first day of such period and (E)
if since the beginning of such period any Person (that subsequently became a
Restricted Subsidiary of the Company or was merged with or into the Company or
any Restricted Subsidiary of the Company since the beginning of such period)
shall have repaid, repurchased, defeased or otherwise discharged Indebtedness or
made any Asset Disposition, Investment or acquisition of assets that would have
required an adjustment pursuant to clause (B), (C) or (D) above if made by the
Company or a Restricted Subsidiary of the Company during such period,
Consolidated Cash Flow and Consolidated Interest Expense for such period shall
be calculated after giving pro forma effect thereto as if such Asset
Disposition, Investment or acquisition occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any Indebtedness
Incurred in connection therewith, the pro forma calculations shall be determined
in good faith by a responsible financial or accounting officer of the Company.
If any Indebtedness bears a floating rate of interest and is being given pro
forma effect, the interest expense on such Indebtedness shall be calculated as
if the rate in effect on the date of determination had been the applicable rate
for the entire period (taking into account any Interest Rate Agreement
applicable to such Indebtedness if such Interest Rate Agreement has a remaining
term in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its Restricted Subsidiaries determined in
accordance with GAAP, plus, to the extent not included in such interest expense
and to the extent incurred by the Company or its Restricted Subsidiaries (i)
interest expense attributable to Capitalized Lease Obligations, (ii)
amortization of debt discount, (iii) capitalized interest, (iv) non-cash
interest expense, (v) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing, (vi)
interest actually paid by the Company or any such Restricted Subsidiary under
any guarantee of Indebtedness or other obligation of any other Person, (vii) net
payments (whether positive or negative) pursuant to Interest Rate Agreements,
(viii) the cash contributions to any employee stock ownership plan or similar
trust to the extent such contributions are used by such plan or trust to pay
interest or fees to any Person (other than the Company) in connection with
Indebtedness Incurred by such plan or trust and (ix) cash and Disqualified Stock
dividends in respect of all Preferred Stock of Subsidiaries and Disqualified
Stock of the Company held by Persons other than the Company or a Wholly-Owned
Subsidiary and less (a) to the extent included in such interest expense, the
amortization of capitalized debt issuance costs and (b) interest income.
Notwithstanding the foregoing, the Consolidated Interest Expense with respect to
any Restricted Subsidiary of the Company that was not a Wholly-Owned
-6-
13
Subsidiary shall be included only to the extent (and in the same proportion)
that the net income of such Restricted Subsidiary was included in calculating
Consolidated Net Income.
"Consolidated Net Income" means, for any period, the consolidated net
income (loss) of the Company and its consolidated Subsidiaries determined in
accordance with GAAP; PROVIDED, HOWEVER, that there shall not be included in
such Consolidated Net Income: (i) any net income (loss) of any Person acquired
by the Company or any of its Restricted Subsidiaries in a pooling of interests
transaction for any period prior to the date of such acquisition, (ii) any net
income of any Restricted Subsidiary of the Company if such Restricted Subsidiary
is subject to restrictions, directly or indirectly, on the payment of dividends
or the making of distributions by such Restricted Subsidiary, directly or
indirectly, to the Company to the extent of such restriction (other than
restrictions in effect on the Issue Date with respect to a Restricted Subsidiary
of the Company and other than restrictions that are created or exist in
compliance with Section 4.08), (iii) any gain or loss realized upon the sale or
other disposition of any assets of the Company or its consolidated Restricted
Subsidiaries (including pursuant to any Sale/Leaseback Transaction) which are
not sold or otherwise disposed of in the ordinary course of business (it being
understood that direct sales of Accounts Receivable to a financial institution
or sales of Accounts Receivable in connection with securitization transactions
shall be deemed to be in the ordinary course of business) and any gain or loss
realized upon the sale or other disposition of any Capital Stock of any Person,
(iv) any extraordinary gain or loss, (v) the cumulative effect of a change in
accounting principles, (vi) the net income of any Person, other than the Company
or a Restricted Subsidiary, except to the extent of the lesser of (A) cash
dividends or distributions actually paid to the Company or any of its Restricted
Subsidiaries by such Person and (B) the net income of such Person (but in no
event less than zero), and the net loss of such Person (other than an
Unrestricted Subsidiary) shall be included only to the extent of the aggregate
Investment of the Company or any of its Restricted Subsidiaries in such Person
and (vii) any non-cash expenses attributable to grants or exercises of employee
stock options. Notwithstanding the foregoing, for the purpose of Section 4.07
only, there shall be excluded from Consolidated Net Income any dividends,
repayments of loans or advances or other transfers of assets from Unrestricted
Subsidiaries to the Company or a Restricted Subsidiary to the extent such
dividends, repayments or transfers increase the amount of Restricted Payments
permitted under such covenant pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Worth" means, the total of the amounts shown on the
balance sheet of the Company and its consolidated Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Company ending prior to the taking of any
action for the purpose of which the determination is being made and for which
financial statements are available (but in no event ending more than 135 days
prior to the taking of such action), as (i) the par or stated value of all
outstanding Capital Stock of the Company plus (ii) paid in capital or capital
surplus relating to such Capital Stock plus (iii) any retained earnings or
earned surplus less (A) any accumulated deficit and (B) any amounts attributable
to Disqualified Stock.
-7-
14
"Continuing Director" of any Person means, as of the date of
determination, any Person who (i) was a member of the Board of Directors of such
Person on the date of this Indenture or (ii) was nominated for election or
elected to the Board of Directors of such Person with the affirmative vote of a
majority of the Continuing Directors of such Person who were members of such
Board of Directors at the time of such nomination or election.
"Convertible Notes" means the Company's 8% Convertible Notes due
September 11, 2002, in the aggregate principal amount of $6,000,000, originally
issued to Xxxxxx X. Xxxxxx and Xxxxx Xxxxxxxx, Ltd.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 11.02 or such other address as to which the Trustee
may give notice to the Company.
"Credit Agreements" means any credit agreement or similar facility or
any other agreement governing Indebtedness entered into by the Company or any
Restricted Subsidiary, as any of the same may be amended, waived, modified,
refinanced with Refinancing Indebtedness or replaced from time to time (except
to the extent any such amendment, waiver, modification, replacement or
refinancing would be prohibited by the terms of this Indenture).
"Currency Agreement" means in respect of a Person any foreign exchange
contract, currency swap agreement or other similar agreement as to which such
Person is a party or a beneficiary.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depository" means The Depository Trust Company, its nominees and their
respective successors.
"Disqualified Stock" means any Capital Stock which, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event (other than an event which
would constitute a Change of Control), (i) matures (excluding any maturity as
the result of an optional redemption by the issuer thereof) or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
Stated Maturity of the Notes, or (ii) is convertible into or exchangeable
(unless at the sole option of the issuer thereof) for (a) debt securities or (b)
any Capital Stock referred to in (i) above, in each case at any time prior to
the final Stated Maturity of the Notes.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
-8-
15
"Equity Offering" means an offering for cash by the Company of its
Common Stock, or options, warrants or rights with respect to its Common Stock,
which in any case is registered with the Commission under the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto, and the rules and regulations of
the Commission promulgated thereunder.
"Exchange Notes" has the meaning set forth in the preamble to this
Indenture.
"Exchange Offer" means the registration by the Company under the
Securities Act pursuant to a registration statement of the offer by the Company
to each Noteholder of the Initial Notes to exchange all the Initial Notes held
by such Noteholder for the Exchange Notes in an aggregate principal amount equal
to the aggregate principal amount of the Initial Notes held by such Noteholder,
all in accordance with the terms and conditions of the Notes Registration Rights
Agreement.
"Existing Indebtedness" means Indebtedness of the Company or its
Restricted Subsidiaries in existence on the Issue Date, plus interest accrued
thereon, after application of the net proceeds of the Notes as described in the
Offering Memorandum.
"fair market value" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. Fair market
value shall be determined by the Board of Directors of the Company acting
reasonably and in good faith and shall be evidenced by a Board Resolution of the
Board of Directors of the Company delivered to the Trustee.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the date of this Indenture, including those
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. All ratios and computations based on GAAP contained in
this Indenture shall be computed in conformity with GAAP.
"Group" shall mean any "group" for purposes of Section 13(d) of the
Exchange Act.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise)
-9-
16
or (ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); PROVIDED, HOWEVER, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; PROVIDED, HOWEVER, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
incurred by such Restricted Subsidiary at the time it becomes a Restricted
Subsidiary; PROVIDED FURTHER that a change in GAAP that results in an obligation
of such Person that exists at such time becoming Indebtedness shall not be
deemed an incurrence of such Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the principal of and premium (if any)
in respect of indebtedness of such Person for borrowed money, (ii) the principal
of and premium (if any) in respect of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii) all obligations of
such Person in respect of letters of credit or other similar instruments
(including reimbursement obligations with respect thereto) (other than
obligations with respect to letters of credit securing obligations (other than
obligations described in clauses (i), (ii) and (v)) entered into in the ordinary
course of business of such Person to the extent that such letters of credit are
not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed
no later than the third business day following receipt by such Person of a
demand for reimbursement following payment on the letter of credit), (iv) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services (except trade payables and other accrued expenses Incurred
in the ordinary course of business, which purchase price is due more than six
months after the date of placing such property in service or taking delivery and
title thereto or the completion of such services, (v) all Capitalized Lease
Obligations and all Attributable Indebtedness of such Person, (vi) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; PROVIDED, HOWEVER,
that if such obligations have not been assumed, the amount of such Indebtedness
shall be deemed to be the lesser of the principal amount of the obligations or
the fair market value of the pledged property or assets, (vii) all Indebtedness
of other Persons to the extent Guaranteed by such Person, (viii) the amount of
all obligations of such Person with respect to the redemption, repayment or
other repurchase of any Disqualified Stock or, with respect to any Restricted
Subsidiary of the Company, any Preferred Stock of such Restricted Subsidiary to
the extent such obligation arises on or before the Stated Maturity of the Notes
(but excluding, in each case, accrued dividends) with the amount of Indebtedness
represented by such Disqualified Stock or Preferred Stock, as the case may be,
being equal to the greater of its voluntary or involuntary liquidation
preference and its maximum fixed repurchase price; provided that, for purposes
hereof the "maximum fixed repurchase price" of any Disqualified Stock or
Preferred Stock, as the case may be, which does not have a fixed repurchase
price shall be calculated in accordance with the terms of such Disqualified
Stock or Preferred Stock, as the case may be, as if such Disqualified Stock or
-10-
17
Preferred Stock, as the case may be, were purchased on any date on which
Indebtedness shall be required to be determined pursuant to the Indenture, and
if such price is based on the fair market value of such Disqualified Stock or
Preferred Stock, as the case may be, such fair market value shall be determined
in good faith by the Board of Directors of the Company and (ix) to the extent
not otherwise included in this definition, obligations under Currency Agreements
and Interest Rate Agreements. Unless specifically set forth above, the amount of
Indebtedness of any Person at any date shall be the outstanding principal amount
of all unconditional obligations as described above, as such amount would be
reflected on a balance sheet prepared in accordance with GAAP, and the maximum
liability of such Person, upon the occurrence of the contingency giving rise to
the obligation, of any contingent obligations described above at such date.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Initial Notes" has the meaning set forth in the preamble to this
Indenture.
"Initial Purchasers" means NatWest Capital Markets Limited and XxXxxxxx
& Company Securities, Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
of Regulation D under the Securities Act.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Notes, which shall be April 1 and October 1 of each year,
commencing October 1, 1998.
"Interest Rate Agreement" means with respect to any Person any interest
rate protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement as to which such Person is party or a beneficiary.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts payable on the balance sheet of such Person) or other
extension of credit (including by way of Guarantee or similar arrangement, but
excluding any debt or extension of credit represented by a bank deposit other
than a time deposit) or capital contribution to (by means of any transfer of
cash or other property to others or any payment for property or services for the
account or use of others), or any purchase or acquisition of Capital Stock,
Indebtedness or other similar instruments issued by such Person. For purposes of
Section 4.07 and the definition of "Unrestricted Subsidiary," (i) "Investment"
shall include the portion (proportionate to the Company's equity interest in a
Restricted Subsidiary to be designated as an Unrestricted Subsidiary) of the
fair market value of the net assets of such Restricted Subsidiary of the Company
at the time that such Restricted Subsidiary is designated an Unrestricted
Subsidiary; PROVIDED, HOWEVER, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have a
permanent "Investment" in an Unrestricted Subsidiary in an amount (if
-11-
18
positive) equal to (x) the Company's "Investment" in such Subsidiary at the time
of such redesignation less (y) the portion (proportionate to the Company's
equity interest in such Subsidiary) of the fair market value of the net assets
of such Subsidiary at the time that such Subsidiary is so redesignated a
Restricted Subsidiary; and (ii) any property transferred to or from an
Unrestricted Subsidiary shall be valued at its fair market value at the time of
such transfer, in each case as determined in good faith by the Board of
Directors and evidenced by a resolution of such Board of Directors certified in
an Officers' Certificate to the Trustee. Notwithstanding the foregoing, in no
event shall the issuance of Capital Stock (other than Disqualified Stock) of the
Company in exchange for Capital Stock, property or assets of another Person
constitute an Investment by the Company in such other Person.
"Issue Date" means the date on which the Notes are originally issued.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind (including any conditional sale or other title retention
agreement or lease in the nature thereof).
"Maturity Date" means April 1, 2008.
"Xxxxx'x" means Xxxxx'x Investors Service, Inc., or its successor.
"Mortgage" or "first Mortgage" means a mortgage, deed of trust, or
similar instrument granted by any applicable Subsidiary Guarantor to or for the
benefit of the Notes Trustee as security for payment and performance of the
obligations of such Subsidiary Guarantor under the Note Guarantee and this
Indenture.
"Mortgages Receivable" means the receivables of the Company and its
Restricted Subsidiaries arising from sales by the Company and its Restricted
Subsidiaries of Residential Lots, or otherwise acquired by the Company or a
Restricted Subsidiary, determined on a consolidated basis in accordance with
GAAP.
"Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
and when received, but excluding any other consideration received in the form of
assumption by the acquiring Person of Indebtedness or other obligations relating
to the properties or assets subject to such Asset Disposition) therefrom in each
case net of (i) all legal, title and recording tax expenses, commissions and
other fees and expenses incurred, and all Federal, state, foreign and local
taxes required to be paid or accrued as a liability under GAAP, as a consequence
of such Asset Disposition, (ii) all distributions and other payments required to
be made to any Person owning a beneficial interest in assets subject to sale or
minority interest holders in Subsidiaries or joint ventures as a result of such
Asset Disposition, (iii) the deduction of appropriate amounts to be provided by
the seller as a reserve, in accordance with GAAP, against any liabilities
associated with the assets disposed of in such Asset Disposition, PROVIDED,
HOWEVER, that upon any reduction in such reserves (other
-12-
19
than to the extent resulting from payments of the respective reserved
liabilities), Net Available Cash shall be increased by the amount of such
reduction to reserves, and retained by the Company or any Restricted Subsidiary
of the Company after such Asset Disposition and (iv) any portion of the purchase
price from an Asset Disposition placed in escrow (whether as a reserve for
adjustment of the purchase price, for satisfaction of indemnities in respect of
such Asset Disposition or otherwise in connection with such Asset Disposition),
PROVIDED, HOWEVER, that upon the termination of such escrow, Net Available Cash
shall be increased by any portion of funds therein released to the Company or
any Restricted Subsidiary.
"Net Cash Proceeds," with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually Incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result of such issuance or sale.
"Non-Recourse Debt" means Indebtedness (i) as to which neither the
Company nor any Restricted Subsidiary (a) provides any Guarantee or credit
support of any kind (including any undertaking, guarantee, indemnity, agreement
or instrument that would constitute Indebtedness) or (b) is directly or
indirectly liable (as a guarantor, general partner or otherwise) and (ii) no
default with respect to which (including any rights that the holders thereof may
have to take enforcement action against an Unrestricted Subsidiary) would permit
(upon notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its Stated Maturity.
"Non-U.S. Person" means a Person who is not a U.S. person, as defined
in Regulation S of the Securities Act.
"Note Guarantee" means each Guarantee of the Notes by any Subsidiary
Guarantor pursuant to Article 10 of this Indenture.
"Noteholder" or "Holder" means a registered holder of one or more
Notes.
"Note Register" means the register of names and addresses of the
Holders of the Notes maintained by the Registrar.
"Notes" means the Initial Notes the Private Exchange Notes and the
Exchange Notes treated as a single class of securities, as amended or
supplemented from time to time in accordance with the terms hereof, that are
issued pursuant to this Indenture.
"Notes Trustee" means Sun Trust Bank, Central Florida, National
Association, a national banking association, until a successor replaces it in
accordance with Article 7 and thereafter means the successor serving hereunder.
-13-
20
"Obligations" means any principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering Memorandum" means the Offering Memorandum dated March 27,
1998, pursuant to which the Initial Notes were offered, and any supplements
thereto.
"Officer" means the Chairman of the Board, the Vice-Chairman of the
Board, the Chief Executive Officer, the Chief Financial Officer, the President,
any Vice-President, the Treasurer or the Secretary or Clerk of the Company.
"Officers' Certificate" means a certificate signed by two Officers of
the Company, at least one of whom shall be the principal executive, financial or
accounting officer of the Company.
"Offshore Physical Notes" has the meaning provided in Section 2.01.
"Opinion of Counsel" means a written opinion, in form and substance
acceptable to the Notes Trustee, from legal counsel who is acceptable to the
Notes Trustee. Such legal counsel may be an employee of or counsel to the
Company or the Notes Trustee.
"Permitted Business" means any business which is the same as or
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the date hereof, as reasonably determined by the
Company's Board of Directors.
"Permitted Investment" means an Investment by the Company or any of its
Restricted Subsidiaries in (i) the Company or a Wholly-Owned Subsidiary of the
Company; PROVIDED, HOWEVER, that the primary business of such Wholly-Owned
Subsidiary is a Permitted Business; (ii) another Person if as a result of such
Investment such other Person becomes a Wholly-Owned Subsidiary of the Company or
is merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, the Company or a Wholly-Owned Subsidiary of the
Company; PROVIDED, HOWEVER, that in each case such Person's primary business is
a Permitted Business; (iii) Temporary Cash Investments; (iv) a Receivables
Subsidiary or originations, purchases or acquisitions of Accounts Receivable by
the Company or any Restricted Subsidiary created or acquired in the ordinary
course of business; (v) payroll, travel and similar advances to cover matters
that are expected at the time of such advances ultimately to be treated as
expenses for accounting purposes and that are made in the ordinary course of
business; (vi) stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Company or any of
its Restricted Subsidiaries or in satisfaction of judgments or claims; (vii) a
Person engaged in a Permitted Business or a loan or advance by the Company the
proceeds of which are used solely to make an investment in a Person engaged in a
Permitted Business or a Guarantee by the Company of Indebtedness of any Person
in which such Investment has been made PROVIDED, HOWEVER, that no Permitted
Investments may be made pursuant to this clause (vii) to the extent the amount
thereof would, when taken together with all other Permitted Investments made
pursuant to this clause (vii), exceed $3.0 million in the
-14-
21
aggregate (plus, to the extent not previously reinvested, any return of capital
realized on Permitted Investments made pursuant to this clause (vii), or any
release or other cancellation of any Guarantee constituting such Permitted
Investment); (viii) Persons to the extent such Investment is received by the
Company or any Restricted Subsidiary as consideration for asset dispositions
effected in compliance with the covenant described under "Limitations on Sales
of Assets and Subsidiary Stock"; (ix) prepayments and other credits to suppliers
made in the ordinary course of business consistent with the past practices of
the Company and its Restricted Subsidiaries; and (x) Investments in connection
with pledges, deposits, payments or performance bonds made or given in the
ordinary course of business in connection with or to secure statutory,
regulatory or similar obligations, including obligations under health, safety or
environmental obligations, (xi) Investments in Currency Agreements and Interest
Rate Protection Agreements permitted by Section 4.09; (xii) any Investment
acquired by the Company or any of its Restricted Subsidiaries (A) in exchange
for any other Investment or accounts receivable held by the Company or any such
Restricted Subsidiary in connection with or as a result of a bankruptcy,
workout, reorganization or recapitalization of the issuer of such other
Investment or accounts receivable or (B) as a result of a foreclosure (or deed
in lieu of) by the Company or any of its Restricted Subsidiaries with respect to
any secured Investment or other transfer of title with respect to any secured
Investment in default; and Investments with respect to deposits made by the
Company or any Restricted Subsidiary in connection with the acquisition of
inventory in the ordinary course of business consistent with past practices.
"Permitted Liens" means: (i) Liens granted by the Company and the
Subsidiary Guarantors which secure Indebtedness to the extent the Indebtedness
is incurred pursuant to paragraph (a) or clause (i) of paragraph (b) under the
"Limitation on Incurrence of Indebtedness" covenant and Liens granted to the
Trustee or the Pledged Properties securing the obligations of certain Subsidiary
Guarantors under their respective Note Guarantees; (ii) Liens in favor of the
Company or any Subsidiary Guarantor; (iii) Liens existing on the Issue Date;
(iv) Liens on property of a Person existing at the time such Person is acquired
by or merged into or consolidated with the Company or any Restricted Subsidiary
thereof; provided that such Liens were in existence prior to the contemplation
of such acquisition and do not extend to any assets of the Company or its
Restricted Subsidiaries other than those acquired in connection with such merger
or consolidation; (v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business; (vi) Liens in respect of
extensions, renewals, refundings or refinancings of any Indebtedness secured by
the Liens referred to in clauses (i), (ii) and (iii) above and (vii) below;
provided that the Liens in connection with such renewal, extensions, renewals,
refundings or refinancing shall be limited to all or part of the specific
property which was subject to the original Lien; (vii) Liens for taxes,
assessments or governmental charges or claims that are not yet delinquent or
that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded; provided that any reserve or other
appropriate provisions as shall be required in conformity with GAAP shall have
been made therefor; (viii) any Lien securing purchase money obligations incurred
in compliance with paragraph (b)(ii) of Section 4.09, provided that such Liens
do not extend to any property (other than the property so purchased) owned by
the Company or its Restricted Subsidiaries and is not incurred more than
-15-
22
30 days after the incurrence of such Indebtedness secured by such Lien; (ix)
Liens to secure Capitalized Lease Obligations (except in respect of
Sale/Leaseback Transactions) on real or personal property of the Company to the
extent consummated in compliance with paragraph (b)(ii) of Section 4.09,
provided that such Liens do not extend to or cover any property of the Company
or any of its Subsidiaries other than the property subject to such Capitalized
Lease Obligation; (x) Liens incurred in the ordinary course of business of the
Company or any Restricted Subsidiary thereof with respect to obligations that do
not exceed $1.0 million at any one time outstanding and that (A) are not
incurred in connection with the borrowing of money or the obtaining of advances
or credit (other than trade credit in the ordinary course of business) and (B)
do not in the aggregate materially detract from the value of the property or
materially impair the use thereof in the operation of the business by the
Company or such Restricted Subsidiary; (xi) Liens on property or assets at the
time the Company or any Restricted Subsidiary acquired such assets, including
any acquisition by means of a merger or consolidation with or into the Company
or such Restricted Subsidiary, PROVIDED, HOWEVER, that (A) if any such Lien is
incurred in anticipation of such transaction, such property or assets subject to
such Lien will have a fair market value at the date of the acquisition thereof
not in excess of the lesser of (1) the aggregate purchase price paid or owed by
the Company or such Restricted Subsidiary in connection with the acquisition
thereof and of any other property and assets acquired simultaneously therewith
and (2) the fair market value of all such property and assets acquired by the
Company or such Restricted Subsidiary and (B) any such Lien will not extend to
any other property or assets owned by the Company or any Restricted Subsidiary;
(xii) Liens on property or assets of the Company securing Interest Rate
Agreements and Currency Agreements so long as the related Indebtedness is
permitted under Section 4.09 and is secured by a Lien on the same property
securing the relevant Interest Rate Agreement or Currency Agreement; (xiii)
survey exceptions, encumbrances, easements or, reservations of, or rights of
others for, licenses, rights-of-way, sewers, electric lines, telegraph and
telephone lines and other similar purposes or zoning or other restrictions as to
the use of real property of the Company or such Restricted Subsidiary incidental
to the ordinary course of conduct of the business of the Company or such
Restricted Subsidiary or as to the ownership of properties of the Company or any
Restricted Subsidiary, which, in either case, were not incurred in connection
with Indebtedness and which do not in the aggregate materially adversely affect
the value of said properties or materially impair their use in the operation of
the business of the Company or any Restricted Subsidiary; (xiv) judgment Liens
with respect to judgments that do not cause an Event of Default under Section
6.01(a)(vii); (xv) Liens with respect to a purchase and sale agreement or other
option or right to acquire property entered into in the ordinary course of
business consistent with past practices prior to the closing date of such
purchase; (xvi) Liens with respect to deposits made by the Company or any
Restricted Subsidiary in connection with the acquisition of inventory in the
ordinary course of business consistent with past practices; and (xvii) Liens
with respect to mineral rights associated with any real property of the Company
or any Restricted Subsidiary.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
hereof or any other entity.
-16-
23
"Physical Notes" has the meaning provided in Section 2.01.
"Pledged Properties" means those parcels of real property and any
improvements thereto owned by any Subsidiary Guarantor and identified in
Schedule P.
"Preferred Stock" as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Private Exchange Notes" has the meaning provided in Section 2(b) of
the Registration Rights Agreement.
"Private Placement Legend" has the meaning provided in Section 2.15.
"Public Debentures" means the Company's 8.25% Convertible Subordinated
Debentures due May 15, 2012, issued pursuant to that certain Indenture dated as
of May 15, 1987, between Xxxxxx Corporation and Shawmut Bank, N.A., as trustee.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"RDI Note" means the Promissory Note in the aggregate principal amount
of $1,500,000 issued in the RDI Acquisition to the RDI Stockholders.
"Receivables and Related Assets" means Accounts Receivable and
instruments, chattel paper, obligations, general intangibles, mortgages, deeds,
records and other similar assets, in each case relating to such Accounts
Receivable.
"Record Date" means the record dates specified in the Notes, whether or
not a Legal Holiday.
"Receivables Subsidiary" means a Subsidiary which is established and
continues to operate for the limited purpose of acquiring, selling and financing
Receivables and Related Assets in connection with receivables securitization or
financing transactions.
"Refinancing Indebtedness" means Indebtedness that refunds, refinances,
replaces, renews, repays, prepays, reduces, defeases, retires or extends
(including pursuant to any defeasance or discharge mechanism) (collectively,
"refinances," and "refinanced" shall have a correlative meaning) any
Indebtedness existing on the date hereof or Incurred in compliance with this
Indenture (including Indebtedness of the Company that refinances Indebtedness of
any Restricted Subsidiary and Indebtedness of any Restricted Subsidiary that
refinances Indebtedness of another Restricted Subsidiary) including Indebtedness
that refinances Refinancing
-17-
24
Indebtedness; PROVIDED, HOWEVER, that (i) the Refinancing Indebtedness has a
Stated Maturity no earlier than the earlier of (A) the first anniversary of the
Stated Maturity of the Notes and (B) the Stated Maturity of the Indebtedness
being refinanced, (ii) the Refinancing Indebtedness has an Average Life at the
time such Refinancing Indebtedness is Incurred that is equal to or greater than
the lesser of (A) the Average Life of the Notes and (B) the Average Life of the
Indebtedness being refinanced and, (iii) the Refinancing Indebtedness is in an
aggregate principal amount (or if issued with original issue discount, an
aggregate issue price) that is equal to (or 101% of, in the case of a
refinancing of the Notes in connection with a Change of Control) or less than
the sum of the aggregate principal amount (or if issued with original issue
discount, the aggregate accreted value) then outstanding of the Indebtedness
being refinanced (plus the amount of any premium required to be paid in
connection therewith and reasonable fees and expenses therewith) PROVIDED,
FURTHER, that Refinancing Indebtedness shall not include Indebtedness of a
Subsidiary which refinances Indebtedness of the Company.
"Registrar" means the Trustee, or any successor thereto appointed as
registrar pursuant to the Indenture.
"Registration Rights Agreement" means the Exchange and Registration
Rights Agreement dated April 1, 1998 between the Company, the Subsidiary
Guarantors and the Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Residential Lots" means any parcel of real property held or sold by
the Company and its Restricted Subsidiaries in the ordinary course of their
residential land business.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the corporate trust department of the Trustee (or any successor
group of the Trustee) with direct responsibility for the administration of this
Indenture and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Investment" means any Investment other than a Permitted
Investment.
"Restricted Payment" has the meaning provided in Section 4.07(a).
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"S&P" and "Standard and Poor's" means Standard & Poor's Ratings
Services, a division of The XxXxxx-Xxxx Companies Inc., or any successor
organization thereto.
-18-
25
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby the Company or a Restricted Subsidiary
transfers such property to a Person and the Company or a Subsidiary leases it
from such Person.
"Secured Indebtedness" means any Senior Indebtedness of the Company or
a Subsidiary Guarantor secured by a Lien.
"Securities Act" means the Securities Act of 1933, as amended, or any
successor statute or statutes thereto, and the rules and regulations of the
Commission promulgated thereunder.
"Senior Indebtedness" means Indebtedness that is not by its terms
expressly subordinate or junior in right of payment to any other Indebtedness of
the Company or the Note Guarantee of a Subsidiary Guarantor.
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision, but excluding any provisions providing for the repurchase,
redemption or repayment of such security at the option of the holder thereof
upon the happening of any contingency unless such contingency has occurred.
"Subordinated Obligations" means Indebtedness that is expressly
subordinate or junior in right of payment to any other Indebtedness of the
Company or the Note Guarantee of a Subsidiary Guarantor.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other interests (including partnership
interests) 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 (i) such Person, (ii) such
Person and one or more Subsidiaries of such Person or (iii) one or more
Subsidiaries of such Person. Unless otherwise specified herein, each reference
to a Subsidiary shall refer to a Subsidiary of the Company.
"Subsidiary Guarantor" means each Subsidiary of the Company in
existence on the Issue Date and each Subsidiary (other than Unrestricted
Subsidiaries) created or acquired by the Company after the Issue Date, other
than BG Aruba, Resort Title Agency, Inc., any Receivables Subsidiary and any
Subsidiary which is established and continues to operate for the limited purpose
of holding a real estate broker's license and acting as a broker for the benefit
of the Company and its Subsidiaries in connection with the sale of real estate
or Timeshare Interests, and certain other Subsidiaries which have individually
less than $50,000 of assets.
-19-
26
"Temporary Cash Investments" means any of the following: (i) any
Investment in direct obligations of the United States of America or any agency
thereof or obligations Guaranteed by the United States of America or any agency
thereof; (ii) Investments in time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States of America having capital surplus and undivided
profits aggregating in excess of $250 million (or the foreign currency
equivalent thereof) and whose long-term debt, or whose parent holding company's
long-term debt, is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization (as defined in
Rule 436 under the Securities Act); (iii) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in clause
(i) above entered into with a bank meeting the qualifications described in
clause (ii) above; (iv) Investments in commercial paper, maturing not more than
180 days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America or any foreign country recognized by the United States
of America with a rating at the time as of which any investment therein is made
of "P-1" (or higher) according to Xxxxx'x or "A-1" (or higher) according to S&P;
(v) Investments in securities with maturities of six months or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least "A" by S&P or "A" by Xxxxx'x; and
(vi) Investments in mutual funds whose investment guidelines restrict such
funds' investments to those satisfying the provisions of clauses (i) through (v)
above.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) and the rules and regulations thereunder as in effect on the date
on which this Indenture is qualified under the TIA, except as provided in
Section 9.03 hereof; PROVIDED, HOWEVER, that, in the event the Trust Indenture
Act of 1939 is amended after such date, "TIA" means, to the extent required by
any such amendment, the Trust Indenture Act of 1939 as so amended.
"Timeshare Interests" means the right to use (whether arising by virtue
of a club membership or a deeded interest in real property or otherwise) a
fully-furnished vacation residence for a specified period each year or
otherwise, sold by the Company and its Restricted Subsidiaries in the ordinary
course of their resorts business.
"Timeshare Interests Receivable" means the receivables of the Company
and its Restricted Subsidiaries arising from sales by the Company and its
Restricted Subsidiaries of Timeshare Interests or otherwise acquired by the
Company or a Restricted Subsidiary (but excluding any receivables for service or
other fees in respect of such Timeshare Interests) determined on a consolidated
basis in accordance with GAAP.
"Title Policy" means an ALTA loan policy of title insurance issued by
Commonwealth Land Title Insurance Company (or such other title company approved
by the Notes Trustee)
-20-
27
insuring the liens of the mortgages as a first priority mortgage lien on the
Pledged Properties subject only to such exceptions and exclusions permitted by
the terms of this Indenture.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary
of the Company(including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary or any of its
Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, the Company or any Restricted Subsidiary of the Company
that is not a Subsidiary of the Subsidiary to be so designated; PROVIDED,
HOWEVER, that each Subsidiary to be so designated and each of its Subsidiaries
has not at the time of such designation, and does not thereafter create, Incur,
issue, assume, Guarantee or otherwise becomes liable with respect to any
Indebtedness other than Non-Recourse Indebtedness and either (A) the Subsidiary
to be so designated has total consolidated assets of $10,000 or less or (B) if
such Subsidiary has consolidated assets greater than $10,000, then such
designation would be permitted under Section 4.07. The Board of Directors may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary subject to
the limitations contained in Section 4.18.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable or redeemable at the issuer's option.
"U.S. Physical Notes" has the meaning provided in Section 2.01.
"Wholly-Owned Subsidiary" means a Restricted Subsidiary of the Company,
at least 99% of the Capital Stock of which (other than directors' qualifying
shares) is owned by the Company or another Wholly-Owned Subsidiary.
SECTION 1.02. OTHER DEFINITIONS.
TERM DEFINED
---- -------
"actual knowledge".................................................................... Section 7.02
"Affiliate Transaction"............................................................... Section 4.11
"Agent Members"....................................................................... Section 2.16
"Appraiser" .......................................................................... Section 11.03
"Asset Disposition Offer"............................................................. Section 3.09
-21-
28
"Bankruptcy Law"...................................................................... Section 6.01
"Change of Control Payment"........................................................... Section 4.14
"Change of Control Payment Date"...................................................... Section 4.14
"covenant defeasance option".......................................................... Section 8.01
"Custodian"........................................................................... Section 6.01
"Declaration"......................................................................... Section 6.02
"Default Amount"...................................................................... Section 6.02
"Designation"......................................................................... Section 4.18
"Designation Amount".................................................................. Section 4.18
"Event of Default".................................................................... Section 6.01
"Funding Subsidiary Guarantor"........................................................ Section 10.05
"Global Note"......................................................................... Section 2.01
"Guaranteed Obligations".............................................................. Section 10.01
"judgment default provision".......................................................... Section 6.01
"legal defeasance option"............................................................. Section 8.01
"Legal Holiday"....................................................................... Section 10.07
"Net Available Cash".................................................................. Section 4.10
"Notice of Default"................................................................... Section 6.01
"Offer Amount"........................................................................ Section 3.09
"Offer Period"........................................................................ Section 3.09
"Paying Agent"........................................................................ Section 2.03
"Purchase Date"....................................................................... Section 3.09
-22-
29
"Registrar".......................................................................... Section 2.03
"Revocation"......................................................................... Section 4.18
"Successor Company".................................................................. Section 5.01
"Taxes".............................................................................. Section 4.05
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
applicable provision is incorporated by reference in and made a part of this
Indenture.
The following TIA term used in this Indenture has the following
meaning:
"obligor" on the Notes means the Company, the Subsidiary
Guarantors and any successor obligor upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule under
the TIA have the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires: (i) a term has the meaning
assigned to it; (ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP; (iii) "or" is not exclusive; (iv) words
in the singular include the plural, and words in the plural include the
singular; and (v) provisions apply to successive events and transactions.
ARTICLE 2: THE NOTES
SECTION 2.01. FORM AND DATING.
The Initial Notes, the notation thereon relating to the Note Guarantees
and the Note Trustee's certificate of authentication thereon shall be
substantially in the form of Exhibit A hereto. The Exchange Notes, the notation
thereon relating to the Note Guarantees and the Notes Trustee's certificate of
authentication thereon shall be substantially in the form of Exhibit B hereto.
The Notes may have notations, legends or endorsements required by law, stock
exchange rule or Depository rule or usage. The Company, the Subsidiary
Guarantors and the Notes Trustee shall approve the form of the Notes and any
notation, legend or endorsement on them. Each Note shall be dated the date of
its authentication.
-23-
30
The terms and provisions contained in the forms of the Notes and the
Note Guarantees, annexed hereto as Exhibits A and B, shall constitute, and are
hereby expressly made, a part of this Indenture and, to the extent applicable,
the Company, the Subsidiary Guarantors and the Notes Trustee, by their execution
and delivery of this Indenture, expressly agree to such terms and provisions and
to be bound thereby.
Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global notes in registered form,
in substantially the form set forth in Exhibit A (the "Global Note"), deposited
with the Notes Trustee, as custodian for the Depository, duly executed by the
Company and authenticated by the Notes Trustee as hereinafter provided. The
aggregate principal amount of the Global Note may from time to time be increased
or decreased by adjustments made on the records of the Notes Trustee, as
custodian for the Depository, as hereinafter provided.
Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "Offshore
Physical Notes"). Notes offered and sold in reliance on any other exemption from
registration under the Securities Act other than as described in the preceding
paragraph shall be issued, and Notes offered and sold in reliance on Rule 144A
may be issued, in the form of permanent certificated Notes in registered form,
in substantially the form set forth in Exhibit A (the "U.S. Physical Notes").
The Offshore Physical Notes and the U.S. Physical Notes are sometimes
collectively herein referred to as the "Physical Notes."
SECTION 2.02. EXECUTION AND AUTHENTICATION.
(a) Two Officers of the Company (each of whom shall, in each
case, have been duly authorized by all requisite corporate actions)
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. Each Subsidiary Guarantor shall execute a Note Guarantee in the
manner set forth in Section 10.02.
(b) A Note shall not be valid until authenticated by the
manual signature of the Notes Trustee. The signature of the Notes
Trustee shall be conclusive evidence that the Note has been
authenticated under this Indenture.
(c) The Notes Trustee shall authenticate (i) Initial Notes for
original issue in the aggregate principal amount not to exceed
$110,000,000, and (ii) Exchange Notes from time to time for issue only
in exchange for a like principal amount of Initial Notes, in each case
upon receipt of a written authenticated order of the Company signed by
two Officers.
(d) The Notes Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Notes. Unless limited by the
terms of such appointment, an
-24-
31
authenticating agent may authenticate Notes whenever the Notes Trustee
may do so. Each reference in this Indenture to authentication by the
Notes Trustee includes authentication by such agent. An authenticating
agent has the same rights as an Agent to deal with the Company or an
Affiliate.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
(a) The Company shall maintain an office or agency (which
shall be located in the Borough of Manhattan in the City of New York,
State of New York) where (i) Notes may be presented for registration of
transfer or for exchange ("Registrar"); (ii) Notes may be presented for
payment ("Paying Agent") and (iii) notices and demands to or upon the
Company in respect of the Notes and this Indenture may be served. The
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. The term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent,
Registrar or co-registrar without prior notice to any Noteholder. The
Company shall notify the Notes Trustee and the Notes Trustee shall
notify the Noteholders 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 Notes Trustee shall act as
such. The Company or any Subsidiary Guarantor may act as Paying Agent,
Registrar or co-registrar. The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, which
shall incorporate the provisions of the TIA. The agreement shall
implement the provisions of this Indenture that relate to such Agent.
The Company shall notify the Notes Trustee of the name and address of
any such Agent. If the Company fails to maintain a Registrar or Paying
Agent, or fails to give the foregoing notice, the Notes Trustee shall
act as such, and shall be entitled to appropriate compensation in
accordance with Section 7.07 hereof.
(b) The Company initially appoints the Notes Trustee as
Registrar, Paying Agent and agent for service of notices and demands in
connection with the Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company, the Subsidiary Guarantors or any other obligor on the
Notes shall require each Paying Agent other than the Notes Trustee to agree in
writing that the Paying Agent shall hold in trust for the benefit of the
Noteholders and the Notes Trustee all money held by the Paying Agent for the
payment of principal of, premium, if any, and interest on the Notes, and shall
notify the Notes Trustee of any Default by the Company, any of the Subsidiary
Guarantors or any other obligor on the Notes in making any such payment. While
any such Default continues, the Notes Trustee may require a Paying Agent to pay
all money held by it to the Notes Trustee. The Company, the Subsidiary
Guarantors or any other obligor on the Notes at any time may require a Paying
Agent to pay all money held by it to the Notes Trustee. Upon payment over to the
Notes Trustee, the Paying Agent (if other than the Company or a Subsidiary
Guarantor) shall have no further liability for the money delivered to the Notes
Trustee. If the
-25-
32
Company, the Subsidiary Guarantors or any other obligor on the Notes acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Noteholders all money held by it as Paying Agent.
SECTION 2.05. NOTEHOLDER LISTS.
The Notes 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
Noteholders and shall otherwise comply with TIA Section 312(a). If the Notes
Trustee is not the Registrar, the Company, the Subsidiary Guarantors or any
other obligor on the Notes shall furnish to the Notes Trustee at least seven
Business Days before each Interest Payment Date and at such other times as the
Notes Trustee may request in writing a list in such form and as of such date as
the Notes Trustee may reasonably require of the names and addresses of
Noteholders, including the aggregate principal amount of the Notes held by each
thereof, and the Company, the Subsidiary Guarantors or any other obligor on the
Notes shall otherwise comply with TIA Section 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Where Notes are presented to the Registrar or a
co-registrar with a request to register the transfer thereof or
exchange them for an equal principal amount of Notes of other
denominations, the Registrar shall register the transfer or make the
exchange if its requirements for such transactions are met; provided,
that any Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed or accompanied by a written instruction
of transfer in form satisfactory to the Registrar and the Notes Trustee
duly executed by the Noteholder thereof or his attorney duly authorized
in writing. To permit registrations of transfer and exchanges, the
Company shall issue and the Notes Trustee shall authenticate Notes at
the Registrar's request.
(b) Neither the Registrar nor the Company shall be required
(i) to issue, to register the transfer of or to exchange Notes during a
period beginning at the opening of business on a Business Day 15 days
before the day of any selection of Notes for redemption under Section
3.02 hereof and ending at the close of business on the day of
selection, (ii) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except the unredeemed
portion of any Note being redeemed in part or (iii) to register the
transfer or exchange of a Note between the Record Date and the next
succeeding Interest Payment Date.
(c) No service charge by the Company shall be made for any
registration of a transfer or exchange (except as otherwise expressly
permitted herein), but the Company may require payment by the
Noteholder of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than such
transfer tax or similar governmental charge payable upon exchanges
pursuant to Section 2.10, 3.06 or 9.05 hereof).
-26-
33
(d) Each Holder of the Global Note shall, by acceptance of
such Global Note, agree that transfers of beneficial interests in such
Global Note may be effected only through a book entry system maintained
by the Holder of such Global Note (or its agent), and that ownership of
a beneficial interest in the Global Note shall be required to be
reflected in a book entry.
SECTION 2.07. REPLACEMENT NOTES.
(a) If any mutilated Note is surrendered to the Notes Trustee,
or the Company and the Notes Trustee receive evidence to the
satisfaction of each thereof of the destruction, loss or theft of any
Note, the Company shall issue and the Notes Trustee, upon receipt by it
of the written order of the Company signed by two Officers of the
Company, shall authenticate a replacement Note if the Notes Trustee's
requirements for replacements of Notes are met. If required by the
Notes Trustee or the Company, an indemnity bond must be supplied by the
Holder that is sufficient in the judgment of the Notes Trustee and the
Company to protect the Company, the Subsidiary Guarantors, the Notes
Trustee, any Agent or any authenticating agent from any loss which any
of them may suffer if a Note is replaced. The Company and the Notes
Trustee may charge a Noteholder for reasonable out-of-pocket expenses
in replacing a Note.
(b) Every replacement Note is an obligation of the Company and
each of the Subsidiary Guarantors.
SECTION 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time are all the Notes
authenticated by the Notes Trustee, EXCEPT for those canceled by the
Company or by the Notes Trustee, those delivered to the Notes Trustee
for cancellation and those described in this Section as not
outstanding.
(b) If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Notes Trustee receives proof
satisfactory to it that the replacement Note is held by a bona fide
purchaser.
(c) If the principal amount of any Note is considered paid
under Section 4.01 hereof, it ceases to be outstanding and interest on
it ceases to accrue.
(d) Subject to Section 2.09 hereof, a Note does not cease to
be outstanding because the Company or an Affiliate of the Company or a
Subsidiary Guarantor holds the Note.
-27-
34
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, the Subsidiary Guarantors, or any of their respective Affiliates shall
be considered as though not outstanding, except that for purposes of determining
whether the Notes Trustee shall be protected in relying on any such direction,
waiver or consent, only Notes which a Responsible Officer of the Notes Trustee
has actual knowledge are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may prepare
and the Notes Trustee shall authenticate temporary Notes upon written order of
the Company signed by two Officers of the Company. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company, the Subsidiary Guarantors and the Notes Trustee consider appropriate
for temporary Notes. Without unreasonable delay, the Company shall prepare and
the Notes Trustee, upon receipt of the written order of the Company signed by
two Officers of the Company, shall authenticate definitive Notes in exchange for
temporary Notes. Until such exchange, temporary Notes shall be entitled to the
same rights, benefits and privileges under this Indenture as definitive Notes.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Notes Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Notes Trustee
any Notes surrendered to the Registrar and Paying Agent for registration of
transfer, exchange or payment. The Notes Trustee (or its Agent) shall cancel all
Notes, if not already canceled, surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall destroy canceled Notes
(subject to the record retention requirements of the Exchange Act), and deliver,
if requested by the Company, certification of their destruction to the Company,
unless by a written order, signed by two Officers of the Company, the Company
shall direct that canceled Notes be returned to it. The Company may not issue
new Notes to replace Notes that it has redeemed or paid or that have been
delivered to the Notes Trustee for cancellation. If the Company acquires any of
the Notes, such acquisition shall not operate as a redemption or satisfaction of
the indebtedness represented by such Notes unless or until the same are
surrendered to the Notes Trustee (or its Agent) for cancellation pursuant to
this Section.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Noteholders
on a subsequent special record date, which date shall be at the earliest
practicable date, but in all events at least five Business Days prior to the
payment
-28-
35
date, in each case at the rate provided in the Notes and in Section 4.01 hereof.
The Company shall, with the consent of the Notes Trustee, fix or cause to be
fixed each such special record date and payment date. At least 15 days before
the special record date, the Company (or, upon the written request of the
Company, the Notes Trustee, in the name of and at the expense of the Company)
shall mail to Noteholders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.
SECTION 2.13. CUSIP NUMBER.
The Company in issuing the Notes may use a "CUSIP" number, and if so,
the Notes Trustee shall use the CUSIP number in notices of redemption or
exchange as a convenience to Noteholders; provided that no representation shall
be deemed to be made by the Notes Trustee as to the correctness or accuracy of
the CUSIP number printed in the notice or on the Notes, and that reliance may be
placed only on the other identification numbers printed on the Notes. The
Company shall promptly notify the Notes Trustee of any change in the CUSIP
number.
SECTION 2.14. DEPOSIT OF MONEYS.
Prior to 10:00 a.m. New York City time on each Interest Payment Date
and Maturity Date, the Company shall deposit with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
in respect of the Notes on such Interest Payment Date or Maturity Date, as the
case may be.
SECTION 2.15. RESTRICTIVE LEGENDS.
Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the following legend (the "Private Placement Legend") unless
otherwise agreed by the Company and the Holder thereof:
THIS NOTE OR ITS PREDECESSORS HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
ACCORDINGLY, NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED,
SOLD OR PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS OR A
BENEFICIAL INTEREST HEREIN EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IF
IT ACQUIRED THIS NOTE FROM THE INITIAL PURCHASERS, IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT), OR, IF IT ACQUIRED THIS NOTE OTHER THAN FROM THE INITIAL
PURCHASERS, (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) or (7) OF
REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (C) IT IS NOT A U.S.
-29-
36
PERSON, IS NOT ACQUIRING THIS NOTE FOR THE ACCOUNT OR BENEFIT OF A U.S.
PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 144A UNDER REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO IN RULE
144(k) UNDER THE SECURITIES ACT AS IN EFFECT WITH RESPECT TO SUCH
TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO
BLUEGREEN CORPORATION OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED
STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE NOTES TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER
OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
TRUSTEE), AND AN OPINION OF COUNSEL ACCEPTABLE TO BLUEGREEN CORPORATION
THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D)
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT TO PERSONS OTHER THAN UNITED STATES
PERSONS ("FOREIGN PURCHASERS"), (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE
CONTAINS A PROVISION REQUIRING THE NOTES TRUSTEE TO REFUSE TO REGISTER
ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
Each Global Note shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY OR A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. 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.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
-30-
37
THE ISSUER 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 HEREON 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.
SECTION 2.16. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTE.
(a) The Global Note initially shall (i) be registered in the
name of the Depository or the nominee of such Depository, (ii) be
delivered to the Notes Trustee as custodian for such Depository and
(iii) bear legends as set forth in Section 2.15.
Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to any
Global Note held on their behalf by the Depository, or the Notes
Trustee as its custodian, or under the Global Note, and the Depository
may be treated by the Company, the Notes Trustee and any agent of the
Company or the Notes Trustee as the absolute owner of the Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Notes Trustee or any agent of the
Company or the Notes Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the
operation of customary practices governing the exercise of the rights
of a Holder of any Note.
(b) Transfers of the Global Note shall be limited to transfers
in whole, but not in part, to the Depository, its successors or their
respective nominees. Interest of beneficial owners in the Global Note
may be transferred or exchanged for Physical Notes in accordance with
the rules and procedures of the Depository and the provisions of
Section 2.17. In addition, Physical Notes shall be transferred to all
beneficial owners in exchange for their beneficial interests in the
Global Note if (i) the Depository notifies the Company that it is
unwilling or unable to continue as Depository for the Global Note and a
successor depository is not appointed by the Company within 90 days of
such notice or (ii) an Event of Default has occurred and is continuing
and the Registrar has received a written request from the Depository or
the Notes Trustee to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion
of the beneficial interest in the Global Note to beneficial owners
pursuant to paragraph (b) above, the Registrar shall (if one or more
Physical Notes are to be issued) reflect on its books and records the
date and a decrease in the principal amount of the beneficial interest
in the Global Note to be transferred, and the Company shall execute,
and the Notes Trustee shall authenticate and deliver, one or more
Physical Notes of like tenor and amount.
-31-
38
(d) In connection with the transfer of the entire Global Note
to beneficial owners pursuant to paragraph (b), the Global Note shall
be deemed to be surrendered to the Notes Trustee for cancellation, and
the Company shall execute, and the Notes Trustee shall authenticate and
deliver, to each beneficial owner identified by the Depository in
exchange for its beneficial interest in the Global Note, an equal
aggregate principal amount of Physical Notes of authorized
denominations.
(e) Any Physical Note constituting a Restricted Security
delivered in exchange for an interest in the Global Note pursuant to
paragraph (b) or (c) above shall, except as otherwise provided by
paragraphs (a)(i)(x) and (c) of Section 2.17, bear the legend regarding
transfer restrictions applicable to the Physical Notes set forth in
Section 2.15.
(f) The Holder of the 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 Noteholder is entitled to take under this Indenture or the Notes.
SECTION 2.17. SPECIAL TRANSFER PROVISIONS.
(a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS
AND NON-U.S. PERSONS. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note
constituting a Restricted Security to any Institutional Accredited
Investor which is not a QIB or to any Non-U.S. Person:
(i) the Registrar shall register the transfer of any
Note constituting a Restricted Security, whether or not such
Note bears the Private Placement Legend, if (x) the requested
transfer is after April 1, 2000 or (y)(1) in the case of a
transfer to an Institutional Accredited Investor which is not
a QIB (excluding Non-U.S. Persons), the proposed transferee
has delivered to the Registrar a certificate substantially in
the form of Exhibit C hereto or (2) in the case of a transfer
to a Non-U.S. Person, the proposed transferor has delivered to
the Registrar a certificate substantially in the form of
Exhibit D hereto; and
(ii) if the proposed transferor is an Agent Member
holding a beneficial interest in the Global Note, upon receipt
by the Registrar of (x) the certificate, if any, required by
paragraph (i) above and (y) instructions given in accordance
with the Depository's and the Registrar's procedures,
whereupon (a) the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of the
Global Note in an amount equal to the principal amount of the
beneficial interest in the Global Note to be transferred, and
(b) the Company shall execute and the Notes Trustee shall
authenticate and deliver one or more Physical Notes of like
tenor and amount.
-32-
39
(b) TRANSFERS TO QIBS. The following provisions shall apply
with respect to the registration of any proposed transfer of a Note
constituting a Restricted Security to a QIB (excluding transfers to
Non-U.S. Persons):
(i) the Registrar shall register the transfer if such
transfer is being made by a proposed transferor who has
checked the box provided for on the form of Note stating, or
has otherwise advised the Company and the Registrar in
writing, that the sale has been effected in compliance with
the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has
otherwise advised the Company and the Registrar in writing,
that it is purchasing the Note for its own account or An
account with respect to which it exercises sole investment
discretion and that any such account is a QIB within the
meaning of Rule 144A, and it 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 it 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 its foregoing representations in
order to claim the exemption from registration provided by
Rule 144A; and
(ii) if the proposed transferee is An Agent Member
and the Notes to be transferred consist of Physical Notes
which after transfer are to be evidenced by an interest in the
Global Note, upon receipt by the Registrar of instructions
given in accordance with the Depository's and the Registrar's
procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of
the Global Note in an amount equal to the principal amount of
the Physical Notes to be transferred, and the Notes Trustee
shall cancel the Physical Notes so transferred.
(c) PRIVATE PLACEMENT LEGEND. Upon the registration of the
transfer, exchange or replacement of Notes not bearing the Private
Placement Legend, the Registrar shall deliver Notes that do not bear
the Private Placement Legend. Upon the registration of the transfer,
exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement
Legend unless (i) the circumstance contemplated by paragraph (a)(i)(x)
of this Section 2.17 exists or (ii) there is delivered to the Registrar
an Opinion of Counsel reasonably satisfactory to the Company and the
Notes Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance
with the provisions of the Securities Act.
(d) GENERAL. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the
restrictions on transfer of such Note set forth in this Indenture and
in the Private Placement Legend and agrees that it will transfer such
Note only as provided in this Indenture.
-33-
40
The Registrar shall retain, for at least two years, copies of all
letters, notices and other written communications received pursuant to Section
2.16 or this Section 2.17. The Company shall have the right to inspect and make
copies of all such letters, notices or other written communications at any
reasonable time upon the giving of reasonable written notice to the Registrar.
SECTION 2.18. PERSONS DEEMED OWNERS.
Prior to due presentment of a Note for registration of transfer and
subject to Section 2.12, the Company, the Notes Trustee, any Paying Agent, any
Registrar and any co-registrar and any Agent of any of the foregoing may deem
and treat the Person in whose name any Note shall be registered upon the
register of Notes kept by the Registrar as the absolute owner of such Note
(whether or not such Note shall be overdue and notwithstanding any notation of
the ownership or other writing thereon made by anyone other than the Company,
any Registrar or any co-registrar) for the purpose of receiving payments of
principal of or interest on such Note and for all other purposes; and none of
the Company, the Notes Trustee, any Paying Agent, any Registrar or any
co-registrar or any Agent of the foregoing shall be affected by any notice to
the contrary.
SECTION 2.19. RECORD DATE.
The record date for purposes of determining the identity of Noteholders
entitled to vote or consent to any action by vote or consent authorized or
permitted under this Indenture shall be the later of (i) 30 days prior to the
first solicitation of such consent or (ii) the date of the most recent list of
Holders furnished to the Notes Trustee, if applicable, pursuant to Section 2.05
hereto.
ARTICLE 3: REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE.
(a) If the Company elects to redeem Notes pursuant to the
optional redemption provisions of Section 3.07 hereof, it shall furnish
to the Notes Trustee, at least 60 days (unless a shorter period is
acceptable to the Notes Trustee) prior to a redemption date, an
Officers' Certificate setting forth (i) the Section of this Indenture
pursuant to which the redemption shall occur, (ii) the redemption date,
(iii) the principal amount of Notes to be redeemed, (iv) the redemption
price and accrued and unpaid interest and (v) whether it requests the
Notes Trustee to give notice of such redemption.
(b) If the Company is required to make an offer to purchase
Notes pursuant to the provisions of Sections 4.10 or 4.14 hereof, it
shall furnish to the Notes Trustee at least 30 days (or such lesser
period as the Notes Trustee may agree), but not more than 60 days,
before mailing any offer to purchase pursuant to such Sections, an
Officers' Certificate setting forth (i) the Section of this Indenture
pursuant to which the offer to purchase shall occur, (ii) the proposed
purchase date, (iii) the maximum principal amount of Notes to be
-34-
41
purchased, (iv) the purchase price and accrued and unpaid interest, (v)
whether it requests the Notes Trustee to mail any offer to purchase and
(vi) further setting forth a statement to the effect that (a) the
Company or one of its Subsidiaries has effected an Asset Disposition
and the conditions set forth in Section 4.10 have been satisfied or (b)
a Change of Control has occurred and the conditions set forth in
Section 4.14 have been satisfied, as applicable.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
(a) If less than all of the Notes are to be redeemed, the
Notes Trustee shall select the Notes to be redeemed among the
Noteholders on a pro rata basis, by lot or in accordance with any other
method the Notes Trustee considers fair and appropriate (and in such
manner as complies with applicable legal and stock exchange
requirements, if any); PROVIDED, HOWEVER, that if a partial redemption
is made with the proceeds of an Equity Offering, selection of the Notes
or portion thereof for redemption shall be made by the Notes Trustee
only on a PRO RATA basis to the extent practicable, unless such method
is otherwise prohibited. In the event of partial redemption by lot, the
particular Notes to be redeemed shall be selected, unless otherwise
provided herein, not less than 45 nor more than 60 days prior to the
redemption date by the Notes Trustee from the outstanding Notes not
previously called for redemption.
(b) The Notes Trustee shall promptly notify the Company in
writing of the Notes selected for redemption and, in the case of any
Note selected for partial redemption, the principal amount thereof to
be redeemed. Notes may be redeemed in part in multiples of $1,000
principal amount only. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption
also apply to portions of Notes called for redemption.
(c) Notice of redemption will be sent, by first class mail,
postage prepaid, at least 30 days prior to the date fixed for
redemption, to each Holder whose Notes are to be redeemed at the last
address for such Holder then shown on the Notes Register.
SECTION 3.03. NOTICE OF REDEMPTION.
(a) Subject to the provisions of Section 3.09 hereof, at least
30 days but not more than 60 days before a redemption date, the Company
shall mail or cause to be mailed a notice of redemption by first class
mail, postage prepaid to each Holder whose Notes are to be redeemed at
the last address for such Holder then shown on the Notes Register.
Each notice of redemption shall identify the Notes to be redeemed and
shall state: (i) the redemption date; (ii) the redemption price; (iii)
if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued; (iv) the name and
address of the Paying
-35-
42
Agent; (v) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price; (vi) that, unless the
Company defaults in making such redemption payment, interest on Notes
called for redemption ceases to accrue on and after the redemption
date; (vii) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed;
and (viii) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Notes to be
redeemed and the aggregate principal amount of Notes to be outstanding
after such partial redemption.
(b) At the Company's request, the Notes Trustee shall give the
notice of redemption in the Company's name and at the Company's
expense; PROVIDED, HOWEVER, that the Company shall have delivered to
the Notes Trustee at least 45 days (unless a shorter period is
acceptable to the Notes Trustee) prior to the proposed redemption date
an Officers' Certificate requesting that the Notes 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 redemption price plus accrued and unpaid interest, if any.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
(a) Prior to 10:00 a.m., New York City time, on any redemption
date, the Company shall deposit with the Paying Agent (other than the
Company or any of its Subsidiaries) money sufficient to pay the
redemption price of and accrued interest on all Notes to be redeemed on
that date. The Paying Agent shall promptly return to the Company any
money deposited with the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, and accrued interest
on, all Notes to be redeemed.
(b) If the Company complies with the provisions of the
preceding paragraph, on and after the redemption date, interest ceases
to accrue on the Notes or the portions of Notes called for redemption
whether or not such Notes are presented for payment, and the only
remaining right of the Holders of such Notes shall be to receive
payment of the redemption price upon surrender to Paying Agent if the
Notes are redeemed. If a Note is redeemed on or after a Record Date,
but on or prior to the related Interest Payment Date, then any accrued
and unpaid interest shall be paid to the Person in whose name such Note
was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal,
from the redemption date until such principal is paid and, to the
extent lawful,
-36-
43
on any interest not paid on such unpaid principal, in each case at the
rate provided in the Notes and in Section 4.01 hereof.
SECTION 3.06. NOTES REDEEMED IN PART.
If any Note is to be redeemed in part only, the notice of redemption
that relates to such Note shall state the portion of the principal amount
thereof to be redeemed. A new Note in principal amount equal to the unredeemed
portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Note. On and after any redemption date, interest
will cease to accrue on the Notes or part thereof called for redemption as long
as the Company has deposited with the Paying Agent funds in satisfaction of the
redemption price pursuant to this Indenture.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as provided in Section 3.07(b), the Company may
redeem all or any portion of the Notes at any time on or after April 1,
2003, at a redemption price equal to a percentage of the principal
amount thereof, as set forth in the immediately succeeding sentence,
plus accrued and unpaid interest to the redemption date. The redemption
price as a percentage of the principal amount shall be as follows, if
the Notes are redeemed during the 12 month period commencing on April 1
of the years set forth below, plus in each case, accrued and unpaid
interest to the date of redemption (subject to the right of holders of
record on the relevant record date to receive interest on the relevant
Interest Payment Date):
PERIOD REDEMPTION PRICE
------ ----------------
2003 105.25%
2004 103.50%
2005 101.75%
2006 and thereafter 100.00%
(b) At any time, or from time to time, prior to April 1, 2001
the Company may, at its option, redeem up to 35% of the original
aggregate principal amount of the Notes with the Net Cash Proceeds of
one or more Equity Offerings by the Company at a redemption price equal
to 110.5% of the principal amount thereof, plus accrued and unpaid
interest thereon, if any, to the date of redemption; PROVIDED, HOWEVER,
that after any such redemption the aggregate principal amount of the
Notes outstanding must equal at least $65 million. In order to effect
the foregoing redemption with the proceeds of any Equity Offering, the
Company shall make such redemption not more than 90 days after the
consummation of any such Equity Offering.
-37-
44
SECTION 3.08. MANDATORY REDEMPTION.
Except as set forth in Sections 4.10 and 4.14, the Company is not
required to make mandatory redemption or sinking fund payments with respect to
the Notes.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
(a) In the event that, pursuant to Section 4.10 hereof, the
Company shall commence an offer to all Noteholders to purchase Notes
(an "Asset Disposition Offer"), it shall follow the procedures
specified below:
(i) The Asset Disposition Offer shall remain
open for a period of 30 Business Days
following its commencement and no longer,
except to the extent that a longer period is
required by applicable law (the "Offer
Period"). No later than five Business Days
after the termination of the Offer Period
(the "Purchase Date"), the Company shall
purchase the principal amount of Notes
required to be purchased pursuant to Section
4.10 hereof (the "Offer Amount") or, if less
than the Offer Amount has been tendered, all
Notes tendered in response to the Asset
Disposition Offer.
(ii) If the Purchase Date is on or after a Record
Date and on or before the related Interest
Payment Date, any accrued interest shall be
paid to the Person in whose name a Note is
registered at the close of business on such
Record Date, and no additional interest
shall be payable to Holders who tender Notes
pursuant to the Asset Disposition Offer.
(iii) Upon the commencement of any Asset
Disposition Offer the Company shall send or
cause to be sent in accordance with Section
3.03, a notice to each Noteholder. The
notice shall contain all instructions and
materials necessary to enable such Holders
to tender Notes pursuant to the Asset
Disposition Offer. The notice, which shall
govern the terms of the Asset Disposition
Offer, shall state:
(1) that the Asset Disposition Offer
is being made pursuant to this
Section 3.09 and Section 4.10 hereof
and the length of time the Asset
Disposition Offer shall remain open;
(2) the Offer Amount, the purchase
price and the Purchase Date;
-38-
45
(3) that any Note not tendered or
accepted for payment shall continue
to accrue interest;
(4) that any Note accepted for
payment pursuant to the Asset
Disposition Offer shall cease to
accrue interest after the Purchase
Date;
(5) that Holders electing to have a
Note purchased pursuant to any Asset
Disposition Offer shall be required
to surrender the Note, with the form
entitled "Option of Noteholder to
Elect Purchase" on the reverse of
the Note completed, to the Company,
a depositary, if appointed by the
Company, or a Paying Agent at the
address specified in the notice at
least three days before the Purchase
Date;
(6) that Holders shall be entitled
to withdraw their election if the
Company, depositary or Paying Agent,
as the case may be, receives, not
later than the expiration of the
Offer Period, a telegram, telex,
facsimile transmission or letter
setting forth the name of the
Holder, the principal amount of the
Note the Holder delivered for
purchase and a statement that such
Holder is withdrawing his election
to have the Note purchased;
(7) that, if the aggregate principal
amount of Notes surrendered by
Holders exceeds the Offer Amount,
the Company shall select the Notes
to be purchased on a pro rata basis
(with such adjustments as may be
deemed appropriate by the Company so
that only Notes in denominations of
$1,000, or integral multiples
thereof, shall be purchased); and
(8) that Holders whose Notes were
purchased only in part shall be
issued new Notes equal in principal
amount to the unpurchased portion of
the Notes surrendered.
(iv) On or before the Purchase Date, the Company
shall, to the extent lawful, accept for
payment, on a pro rata basis to the extent
necessary, the Offer Amount of Notes or
portions thereof tendered pursuant to the
Asset Disposition Offer or, if less than the
Offer Amount has been tendered, all Notes or
portions thereof tendered, and deliver to
the Notes Trustee an Officers' Certificate
stating that such Notes or portions thereof
were accepted for payment by the Company in
accordance with the terms of this Section
3.09. The
-39-
46
Paying Agent shall promptly (but in any case
not later than five Business Days after the
Purchase Date) mail or deliver to each
tendering Holder an amount equal to the
purchase price of the Note tendered by such
Holder and accepted by the Company for
purchase, and the Company shall promptly
issue a new Note, and at the written request
of the Company the Notes Trustee shall
authenticate and mail or deliver such new
Note, to such Holder equal in principal
amount to any unpurchased portion of the
Note surrendered. Any Note not so accepted
shall be promptly mailed or delivered by the
Company to the Holder thereof. The Company
shall publicly announce the results of the
Asset Disposition Offer on the Purchase
Date.
ARTICLE 4: COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
(a) The Company shall pay the principal of, premium, if any,
and interest on the Notes on the dates and in the manner provided in
the Notes and in this Indenture. Principal, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent,
if other than the Company or a Subsidiary Guarantor, holds as of 10:00
a.m. New York City time on the due date money deposited by the Company
in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due. Such Paying
Agent shall return to the Company, no later than five Business Days
following the date of payment, any money (including accrued interest
paid by the Company) that exceeds such amount of principal, premium, if
any, and interest paid on the Notes.
(b) The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue
principal at the rate equal to 2% per annum in excess of the then
applicable interest rate on the Notes to the extent lawful, and it
shall pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue installments of interest (without
regard to any applicable grace period) at the same rate to the extent
lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) The Company shall maintain in the Borough of Manhattan, in
the City of New York, an office or agency (which may be an office of
the Notes Trustee or an affiliate of the Notes Trustee, Registrar or
co-registrar) where Notes may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the
Company in respect of the Notes and this Indenture may be served. The
Company shall give prior written notice to the Notes Trustee of the
location, and any change in the location, of such office or agency. If
at any time the Company shall fail to maintain any
-40-
47
such required office or agency or shall fail to furnish the Notes
Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office
of the Notes Trustee.
(b) The Company may also from time to time designate one or
more other offices or agencies where the Notes may be presented or
surrendered for any or all such purposes and may from time to time
rescind such designations; PROVIDED, HOWEVER, that no such designation
or rescission shall in any manner relieve the Company of its obligation
to maintain an office or agency in the Borough of Manhattan, in the
City of New York for such purposes. The Company shall give prior
written notice to the Notes Trustee of any such designation or
rescission and of any change in the location of any such other office
or agency.
(c) The Company hereby designates the Corporate Trust Office
of the Notes Trustee as one such office or agency of the Company in
accordance with Section 2.03. The address of the Corporate Trust Office
of the Notes Trustee in the City of New York is: SunTrust Bank, c/o
First Chicago Trust Company of New York, Corporate Trust - 8th Floor,
00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
SECTION 4.03. SEC REPORTS.
(a) Upon consummation of the Exchange Offer and the issuance
of the Exchange Notes, the Company and each Subsidiary Guarantor (at
its own expense) shall file with the Commission and shall furnish to
the Notes Trustee, and , upon request, each Noteholder, within 15 days
after it files them with the Commission, copies of the quarterly and
annual reports and of the information, documents, and other reports (or
copies of such portions of any of the foregoing as the Commission may
by rules and regulations prescribe) to be filed pursuant to Section 13
or 15(d) of the Exchange Act (without regard to whether the Company is
subject to the requirements of such Section 13 or 15(d) of the Exchange
Act); PROVIDED, HOWEVER, that prior to the consummation of the Exchange
Offer and the issuance of the Exchange Notes, the Company (at its own
expense), will mail to the Notes Trustee and the Noteholders in
accordance with paragraph (b) of this Section 4.03 substantially the
same information that would have been required by the foregoing
documents within 15 days of when any such document would otherwise have
been required to be filed with the Commission. Upon qualification of
this Indenture under the TIA, the Company and each Subsidiary Guarantor
shall also comply with the provisions of TIA Section 314(a).
(b) At the Company's expense, the Company and each Subsidiary
Guarantor, as applicable, shall cause an annual report if furnished by
it to stockholders generally and each quarterly or other financial
report if furnished by it to stockholders generally to be filed with
the Notes Trustee and mailed to the Noteholders at their addresses
appearing in the register of Notes maintained by the Registrar at the
time of such mailing or furnishing to stockholders.
-41-
48
(c) The Company and each Subsidiary Guarantor shall provide to
any Holder of Initial Notes any information reasonably requested by
such Holder concerning the Company and each Subsidiary Guarantor
(including financial statements) necessary in order to permit such
Holder to sell or transfer Notes in compliance with Rule 144A under the
Securities Act.
(d) If the Company instructs the Notes Trustee to distribute
any of the documents described in Section 4.03(a) to the Noteholders,
the Company shall provide the Notes Trustee with a sufficient number of
copies of all such documents.
SECTION 4.04. COMPLIANCE CERTIFICATES.
(a) The Company and each Subsidiary Guarantor shall deliver to
the Notes Trustee, within 90 days after the end of each fiscal year, an
Officers' Certificate signed by its principal executive officer,
principal financial officer or principal accounting officer stating
that a review of the activities of the Company and its Subsidiaries or
such Subsidiary Guarantor, as the case may be, during the preceding
fiscal year has been made under the supervision of the signing Officers
with a view to determining whether each has kept, observed, performed
and fulfilled its Obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the
best of his or her knowledge each has kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is
not in default in the performance or observance of any of the terms,
provisions and conditions of this Indenture (or, if a Default or Event
of Default shall have occurred during such period, describing all such
Defaults or Events of Default of which he or she may have knowledge and
what action each is taking or proposes to take with respect thereto).
(b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public
Accountants, the year-end financial statements delivered pursuant to
Section 4.03 above shall be accompanied by a written statement of (x)
the Company's independent public accountants (who shall be a firm of
established national reputation) that in making the examination
necessary for certification of such financial statements nothing has
come to their attention which would lead them to believe that the
Company has violated any provisions of Article 4, 5 or 6 of this
Indenture insofar as they relate to accounting matters or, if any such
violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable
directly or indirectly to any Person for any failure to obtain
knowledge of any such violation and (y) if any Restricted Subsidiary's
or Subsidiary Guarantor's financial statements are not prepared on a
consolidated basis with the Company's, such Restricted Subsidiary's or
Guarantor's independent public accountants (who shall be a firm of
established national reputation) that in making the examination
necessary for certification of such financial statements nothing has
come to their attention which would lead them to believe that any of
the Restricted Subsidiaries or Subsidiary Guarantors is in Default
under this Indenture or, if any such Default has occurred, specifying
the nature and period
-42-
49
of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to
obtain knowledge of any such violation.
(c) The Company and each of the Subsidiary Guarantors shall,
so long as any of the Notes are outstanding, deliver to the Notes
Trustee, forthwith upon any Officer becoming aware of (i) any Default
or Event of Default or (ii) any event of default under any other
mortgage, indenture or instrument to which the Company is a party, an
Officers' Certificate specifying such Default, Event of Default or
event of default and what action the Company or such Subsidiary
Guarantor, as the case may be, is taking or proposes to take with
respect thereto.
(d) The Company and each of the Subsidiary Guarantors shall
also comply with TIA Section 314(a)(4).
SECTION 4.05. TAXES.
The Company will, and will cause its Restricted Subsidiaries to, pay
and discharge when due all taxes, levies, imposts, duties or other governmental
charges ("Taxes") imposed on its income or profits or on any of its properties,
except such Taxes which are being contested in good faith in appropriate
proceedings and for which adequate reserves have been established in accordance
with GAAP.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
Each of the Company and the Subsidiary Guarantors covenants (to the
extent that it may lawfully do so) that it shall 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, that may affect the covenants or the performance of this Indenture
(including, but not limited to, the payment of the principal of or interest on
the Notes); and the Company and each Subsidiary Guarantor (to the extent that
they may lawfully do so) hereby expressly waive all benefit or advantage of any
such law, and covenant that they shall not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Notes Trustee,
but shall suffer and permit the execution of every such power as though no such
law has been enacted.
SECTION 4.07. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries, directly or indirectly, to (i) declare or pay
any dividend or make any distribution on or in respect of its Capital
Stock (including any payment in connection with any merger or
consolidation involving the Company or any of its Restricted
Subsidiaries) except (A) dividends or distributions payable in its
Capital Stock (other than Disqualified Stock) or in options, warrants
or other rights to purchase such Capital Stock and (B) dividends or
distributions payable to the Company or a Restricted
-43-
50
Subsidiary of the Company which holds any equity interest in the paying
Restricted Subsidiary, (ii) purchase, redeem, retire or otherwise
acquire for value any Capital Stock of the Company held by Persons
other than a Wholly-Owned Subsidiary of the Company or any Capital
Stock of a Restricted Subsidiary of the Company held by any Affiliate
of the Company, other than a Wholly-Owned Subsidiary (in either case,
other than in exchange for its Capital Stock (other than Disqualified
Stock)), (iii) purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, any Subordinated Obligations or (iv) make
any Investment (other than a Permitted Investment) in any Person (any
such dividend, distribution, purchase, redemption, repurchase,
defeasance, other acquisition, retirement or Investment as described in
preceding clauses (i) through (iv) being referred to as a "Restricted
Payment"), if at the time the Company or such Restricted Subsidiary
makes such Restricted Payment and immediately after giving pro forma
effect to such Restricted Payment:
(1) a Default shall have occurred and be continuing (or
would result therefrom); or
(2) the Company is not able to Incur an additional $1.00
of Indebtedness pursuant to paragraph (a) under
Section 4.09; or
(3) the aggregate amount of such Restricted Payment and
all other Restricted Payments declared or made
subsequent to the Issue Date would exceed the sum,
without duplication, of (A) 50% of the Consolidated
Net Income accrued during the period (treated as one
accounting period) from the first day of the first
fiscal quarter beginning on or after the Issue Date
to the end of the most recent fiscal quarter ending
prior to the date of such Restricted Payment as to
which financial results are available (but in no
event ending more than 135 days prior to the date of
such Restricted Payment) (or, in case such
Consolidated Net Income shall be a deficit, minus
100% of such deficit); (B) the aggregate net proceeds
received by the Company from the issue or sale of its
Capital Stock subsequent to the Issue Date (other
than Disqualified Stock and other than Net Cash
Proceeds received from an issuance or sale of such
Capital Stock to a Subsidiary of the Company); (C)
the amount by which Indebtedness of the Company is
reduced on the Company's balance sheet upon the
conversion or exchange (other than by a Restricted
Subsidiary of the Company) subsequent to the Issue
Date of any Indebtedness of the Company convertible
or exchangeable for Capital Stock of the Company
(less the amount of any cash, or other property,
distributed by the Company upon such conversion or
exchange); (D) the amount equal to the net reduction
in Investments (other than Permitted Investments)
made after the Issue Date by the Company or any of
its Restricted Subsidiaries in any Person resulting
from (i) repurchases or redemptions of such
Investments by such Person, proceeds realized upon
the sale of such Investment to an
-44-
51
unaffiliated purchaser, repayments of loans or
advances or other transfers of assets by such Person
to the Company or any Restricted Subsidiary of the
Company or (ii) the redesignation of Unrestricted
Subsidiaries as Restricted Subsidiaries (valued in
each case as provided in the definition of
"Investment") not to exceed, in the case of any
Unrestricted Subsidiary, the amount of Investments
previously included in the calculation of the amount
of Restricted Payments; PROVIDED, HOWEVER, that no
amount shall be included under this clause (D) to the
extent it is already included in Consolidated Net
Income; and (E) $5 million.
(b) The provisions of paragraph (a) shall not prohibit: (i)
any purchase or redemption of Capital Stock or Subordinated Obligations
of the Company made by exchange for, conversion into or out of the
proceeds of the substantially concurrent sale of, Capital Stock of the
Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary); PROVIDED, HOWEVER, that (A) such
purchase or redemption shall be excluded in the calculation of the
amount of Restricted Payments and (B) the Net Cash Proceeds (to the
extent used for such purchase or redemption) from such sale shall be
excluded from clause (3) (B) of paragraph (a); (ii) any purchase or
redemption of Subordinated Obligations of the Company made by exchange
for, conversion into or out of the proceeds of the substantially
concurrent sale of, Subordinated Obligations constituting Refinancing
Indebtedness of the Company in compliance with Section 4.09; PROVIDED,
FURTHER, that such purchase or redemption shall be excluded in the
calculation of the amount of Restricted Payments; (iii) any purchase or
redemption of Subordinated Obligations as a result of a Change of
Control (provided that Section 4.14 is complied with); (iv) any
purchase or redemption of Subordinated Obligations from Net Available
Cash to the extent permitted under Section 4.10; PROVIDED, FURTHER,
that such purchase or redemption shall be excluded in the calculation
of the amount of Restricted Payments; (v) payment by the Company of any
scheduled sinking fund payments under the Public Debentures; provided
that the Company reduces its required sinking fund payments to the
maximum amount permitted under the Indenture pursuant to which such
Public Debentures were issued; (vi) repayment of the Convertible Notes
upon stated maturity, PROVIDED, HOWEVER, that the amount of such
payment shall be included in the calculation of the amount of
Restricted Payments subsequent to the date of such payment; (vii)
dividends paid within 60 days after the date of declaration if at such
date of declaration such dividend would have complied with this
provision; PROVIDED, HOWEVER, that such dividend shall be included in
the calculation of the amount of Restricted Payments; and (viii)
repurchases of Capital Stock deemed to occur upon the exercise of stock
options (other than options relating to Disqualified Stock) if such
Capital Stock represents a portion of the exercise price of such
options; PROVIDED, HOWEVER, that such dividend shall be included in the
calculation of the amount of Restricted Payments; PROVIDED, HOWEVER,
that in the case of clauses (i), (ii), (iii), (iv) and (v) no Default
or Event of Default shall have occurred or be continuing at the time of
such payment or as a result thereof.
-45-
52
(c) For purposes of determining compliance with the covenant
set forth in this Section 4.07, Restricted Payments may be made with
cash or non-cash assets, provided that any Restricted Payment made
other than in cash shall be valued at the fair market value
(determined, subject to the additional requirements of the immediately
succeeding proviso, in good faith by the Board of Directors) of the
assets so utilized in making such Restricted Payment, PROVIDED,
HOWEVER, that (i) in the case of any Restricted Payment made with
Capital Stock or Indebtedness, such Restricted Payment shall be deemed
to be made in an amount equal to the greater of the fair market value
thereof and the liquidation preference (if any) or principal amount of
the Capital Stock or Indebtedness, as the case may be, so utilized, and
(ii) in the case of any Restricted Payment in an aggregate amount in
excess of $2.0 million but less than $4.0 million, the fairness of the
valuation thereof (as determined by the Company) for purposes of
determining compliance with Section 4.07 shall be approved by a
majority of the disinterested members of the Board of Directors of the
Company and (iii) in the case of any Restricted Payment in an aggregate
amount of $4.0 million or more, a written opinion as to the fairness of
the valuation thereof (as determined by the Company) for purposes of
determining compliance with Section 4.07 shall be issued by an
independent investment banking, accounting or qualified appraisal firm
of national standing.
(d) Not later than the date of making any Restricted Payment,
the Company shall deliver to the Notes Trustee an Officer's Certificate
stating that such Restricted Payment complies with this Indenture and
setting forth in reasonable detail the basis upon which the required
calculations were computed, which calculations may be based upon the
Company's latest available quarterly financial statements, and a copy
of any required investment banker's, accountant's or appraiser's
opinion.
SECTION 4.08. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM
RESTRICTED SUBSIDIARIES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create or permit to exist or become effective any consensual
encumbrance or restriction on the ability of any such Restricted Subsidiary to
(i) pay dividends or make any other distributions on its Capital Stock or pay
any Indebtedness or other obligation owed to the Company, (ii) make any loans or
advances to the Company or (iii) transfer any of its property or assets to the
Company, or (iv) guarantee the Notes, except: (a) any encumbrance or restriction
pursuant to an agreement in effect at or entered into on the Issue Date,
including, without limitation, the Indenture, the Notes and the Credit
Agreements, if any; (b) any encumbrance or restriction with respect to such a
Restricted Subsidiary pursuant to an agreement relating to any Indebtedness
issued by such Restricted Subsidiary on or prior to the date on which such
Restricted Subsidiary was acquired by the Company and outstanding on such date
(other than Indebtedness Incurred in anticipation of, or to provide all or any
portion of the funds or credit support utilized to consummate, the transaction
or series of related transactions pursuant to which such Restricted Subsidiary
became a Restricted Subsidiary of the Company or was acquired by the Company)
provided that such encumbrance or restriction is not applicable to any
properties or assets other than of the types
-46-
53
owned or held by such Restricted Subsidiary at the time it became a Restricted
Subsidiary; (c) any encumbrance or restriction with respect to such a Restricted
Subsidiary effecting a refinancing of Indebtedness issued pursuant to an
agreement referred to in clauses (a) or (b) or this clause (c) or contained in
any amendment to an agreement referred to in clauses (a) or (b) or this clause
(c) (or effecting a Refinancing of such Refinancing Indebtedness pursuant to
this clause (c) or contained in any amendment, modification, restatement,
renewal or supplement to an agreement referred to in clauses (i) or (ii) or this
clause (iii)); PROVIDED, HOWEVER, that the encumbrances and restrictions with
respect to such Restricted Subsidiary contained in any of such agreement,
refinancing agreement or amendment, taken as a whole, are no less favorable to
the Holders of the Notes in any material respect, as determined in good faith by
the Board of Directors of the Company, than encumbrances and restrictions with
respect to such Restricted Subsidiary contained in agreements in effect at, or
entered into on, the Issue Date; (d) in the case of clause (iii) of this Section
4.08, any encumbrance or restriction (A) that restricts in a customary manner
the subletting, assignment or transfer of any property or asset that is a lease,
license, conveyance or contract or similar property or asset, (B) by virtue of
any transfer of, agreement to transfer, option, or right with respect to, or
Lien on, any property or assets of the Company or any Restricted Subsidiary not
otherwise prohibited by this Indenture or (C) that is included in a licensing
agreement to the extent such restrictions limit the transfer of the property
subject to such licensing agreement; (e) in the case of clause (iii) of this
Section 4.08, restrictions contained in security agreements, mortgages or
similar documents securing Indebtedness (including purchase money Indebtedness)
of a Restricted Subsidiary to the extent such restrictions restrict the transfer
of the property subject to such security agreements, mortgages or similar
documents; (f) any restriction with respect to such a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or disposition of all
or substantially all of the Capital Stock or assets of such Restricted
Subsidiary pending the closing of such sale or disposition; (g) encumbrances or
restrictions arising or existing by reason of applicable law; (h) any
encumbrance or restriction pursuant to Indebtedness of Receivables Subsidiaries
that is permitted to be Incurred subsequent to the Issue Date pursuant to
Section 4.07; and (i) restrictions on cash or other deposits imposed by
customers under contracts incurred in the ordinary course of business consistent
with past practices.
SECTION 4.09. LIMITATION ON INDEBTEDNESS.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, Incur any Indebtedness; PROVIDED, HOWEVER,
that the Company and its Restricted Subsidiaries may Incur Indebtedness
if no Default or Event of Default shall have occurred and be continuing
at the time of such Incurrence or would occur as a consequence of such
Incurrence and the Consolidated Coverage Ratio would be equal to at
least (x) 2.00 to 1.00 if such Indebtedness is Incurred prior to April
1, 2000, (y) 2.25 to 1.00 if such Indebtedness is Incurred after April
1, 2000 but prior to March 31, 2002, and (z) 2.50 to 1.00 after March
31, 2002.
(b) Notwithstanding the foregoing paragraph (a), the Company
and its Restricted Subsidiaries may Incur the following Indebtedness:
-47-
54
(i) Indebtedness Incurred under any Credit
Agreements and/or pursuant to seller
financing in connection with the acquisition
of inventory; PROVIDED, HOWEVER, after
giving effect to such Incurrence, the
aggregate principal amount of such
Indebtedness then outstanding does not
exceed $30.0 million;
(ii) Indebtedness represented by Capitalized
Lease Obligations, mortgage financings or
purchase money obligations in addition to
that specified in clause (i) above, in each
case Incurred for the purpose of financing
all or any part of the purchase price or
cost of construction or improvement of
property or equipment used in a Permitted
Business or Incurred to refinance any such
purchase price or cost of construction or
improvement, in each case Incurred no later
than 365 days after the date of such
acquisition or the date of completion of
such construction or improvement; PROVIDED,
HOWEVER, that the principal amount of any
Indebtedness Incurred pursuant to this
clause (ii) shall not exceed $2.0 million at
any time outstanding;
(iii) Indebtedness outstanding pursuant to the
Public Debentures, the Convertible Notes and
the RDI Note and other Existing Indebtedness
outstanding as of the Issue Date after the
application of the net proceeds of the
Offering;
(iv) Indebtedness of the Company owing to and
held by any Wholly-Owned Subsidiary or
Indebtedness of a Restricted Subsidiary
owing to and held by the Company or any
Wholly-Owned Subsidiary; PROVIDED, HOWEVER,
that (A) if the Company is the obligor on
such Indebtedness, such Indebtedness is
expressly subordinate to the payment in full
of all Obligations with respect to the Notes
and (B) any subsequent issuance or transfer
of any Capital Stock or any other event
which results in any such Wholly-Owned
Subsidiary ceasing to be a Wholly-Owned
Subsidiary or any subsequent transfer of any
such Indebtedness (except to the Company or
any Wholly-Owned Subsidiary) shall be
deemed, in each case, to constitute the
Incurrence of such Indebtedness by the
issuer thereof;
(v) Indebtedness represented by (A) the Notes
and any Exchange Notes issued in exchange
for the Notes of any equal principal amount,
(B) the Note Guarantees, (C) any Refinancing
Indebtedness Incurred in respect of any
Indebtedness described in clauses (i)
through (iii) or this clause (v) or Incurred
pursuant to paragraph (a) above;
-48-
55
(vi) (A) Indebtedness of a Restricted Subsidiary
Incurred and outstanding on the date on
which such Restricted Subsidiary was
acquired by the Company (other than
Indebtedness Incurred in anticipation of, or
to provide all or any portion of the funds
or credit support utilized to consummate the
transaction or series of related
transactions pursuant to which such
Restricted Subsidiary became a Subsidiary or
was otherwise acquired by the Company);
PROVIDED, HOWEVER, that at the time such
Restricted Subsidiary is acquired by the
Company, the Company would have been able to
Incur $ 1.00 of additional Indebtedness
pursuant to paragraph (a) above after giving
effect to the Incurrence of such
Indebtedness pursuant to this clause (vi)
and (B) Refinancing Indebtedness Incurred by
a Restricted Subsidiary in respect of
Indebtedness Incurred by such Restricted
Subsidiary pursuant to this clause (vi);
(vii) Indebtedness (A) in respect of performance
bonds, completion and maintenance bonds,
bankers' acceptances letters of credit and
surety or appeal bonds provided by the
Company or any of its Restricted
Subsidiaries to their customers in the
ordinary course of their business, (B) in
respect of performance bonds or similar
obligations of the Company or any of its
Restricted Subsidiaries for or in connection
with pledges, deposits or payments made or
given in the ordinary course of business in
connection with or to secure statutory,
regulatory or similar obligations, including
obligations under health, safety or
environmental obligations and (C) arising
from Guarantees to suppliers, lessors,
licensees, contractors, franchises or
customers of obligations (other than
Indebtedness) Incurred in the ordinary
course of business;
(viii) Indebtedness arising from agreements
providing for indemnification, adjustment of
purchase price or similar obligations, or
from Guarantees or letters of credit, surety
bonds or performance bonds securing any
obligations of the Company or any of its
Restricted Subsidiaries pursuant to such
agreements, in each case Incurred in
connection with the disposition of any
business assets or Restricted Subsidiary of
the Company (other than Guarantees of
Indebtedness or other obligations Incurred
by any Person acquiring all or any portion
of such business assets or Restricted
Subsidiary of the Company for the purpose of
financing such acquisition) in a principal
amount not to exceed the gross proceeds
actually received by the Company or any of
its Restricted Subsidiaries in connection
with such disposition; PROVIDED, HOWEVER,
that the principal amount of any
Indebtedness Incurred
-49-
56
pursuant to this clause (viii), when taken
together with all Indebtedness Incurred
pursuant to this clause (viii) and then
outstanding, shall not exceed $2.0 million;
(ix) Indebtedness under Currency Agreements and
Interest Rate Agreements; PROVIDED, HOWEVER,
that in the case of Currency Agreements and
Interest Rate Agreements, such Currency
Agreements and Interest Rate Agreements are
entered into for bona fide hedging purposes
of the Company or its Restricted
Subsidiaries (as determined in good faith by
the Board of Directors of the Company) and
correspond in terms of notional amount,
duration, currencies and interest rates, as
applicable, to Indebtedness of the Company
or its Restricted Subsidiaries Incurred
without violation of the Indenture or to
business transactions of the Company or its
Restricted Subsidiaries on customary terms
entered into in the ordinary course of
business;
(x) Indebtedness consisting of (A) Guarantees by
the Company (so long as the Company could
have Incurred such Indebtedness directly
without violation of this Indenture) and (B)
Guarantees by a Restricted Subsidiary of
Senior Indebtedness Incurred by the Company
without violation of this Indenture (so long
as such Restricted Subsidiary could have
Incurred such Indebtedness directly without
violation of this Indenture);
(xi) Indebtedness arising from the honoring by a
bank or other financial institution of a
check, draft or similar instrument issued by
the Company or its Restricted Subsidiaries
drawn against insufficient funds in the
ordinary course of business in an amount not
to exceed $250,000 at any time; provided
that such Indebtedness is extinguished
within two Business Days of its incurrence;
and
(xii) Indebtedness (other than Indebtedness
described in clauses (i) - (xi)) in a
principal amount which, when taken together
with the principal amount of all other
Indebtedness Incurred pursuant to this
clause (xii) and then outstanding, will not
exceed $10.0 million
For purposes of determining compliance with this Section 4.09,
in the event that an item of Indebtedness meets the criteria of more
than one of the types of Indebtedness described in the above clauses at
the time of incurrence, the Company shall, in its sole discretion,
classify such item of Indebtedness and only be required to include the
amount and type of such Indebtedness in the applicable clause(s) so
selected by the Company. No fluctuation in currency exchange rates or
interest rates following the incurrence of any
-50-
57
Indebtedness shall result in a Default hereunder, if the Indebtedness
itself was incurred in compliance with the Indenture at the time of
incurrence.
(c) Neither the Company nor any Restricted Subsidiary shall
Incur any Indebtedness under paragraph (b) above if the proceeds
thereof are used, directly or indirectly, to refinance any Subordinated
Obligations of the Company unless such Indebtedness shall be
subordinated to the Notes to at least the same extent as such
Subordinated Obligations. No Restricted Subsidiary shall Incur any
Indebtedness under paragraph (b) above if the proceeds thereof are
used, directly or indirectly, to refinance any Subordinated Obligation
of such Subsidiary Guarantor unless such Indebtedness shall be
subordinated to the obligations of such Subsidiary Guarantor under the
Note Guarantee to at least the same extent as such Subordinated
Obligation.
(d) The Company will not permit any Unrestricted Subsidiary to
Incur any Indebtedness other than Non-Recourse Debt.
SECTION 4.10. LIMITATION ON SALES OF ASSETS AND SUBSIDIARY STOCK.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, make any Asset Disposition unless (i) the
Company or such Restricted Subsidiary receives consideration at the
time of such Asset Disposition at least equal to the fair market value,
as determined in good faith by the Company's Board of Directors
(including as to the value of all non-cash consideration), of the
shares and assets subject to such Asset Disposition, (ii) at least 75%
of the consideration thereof received by the Company or such Restricted
Subsidiary is in the form of cash or Cash Equivalents and (iii) an
amount equal to 100% of the Net Available Cash from such Asset
Disposition is applied by the Company (or such Restricted Subsidiary,
as the case may be) (A) FIRST, to the extent the Company or any
Restricted Subsidiary elects (or is required by the terms of any
Secured Indebtedness), (x) to prepay, repay or purchase Secured
Indebtedness or (y) to the investment in or acquisition of Additional
Assets within 360 days from the later of the date of such Asset
Disposition or the receipt of such Net Available Cash; (B) SECOND,
within 360 days from the receipt of such Net Available Cash, to the
extent of the balance of such Net Available Cash after application in
accordance with clause (A), to make an offer to purchase Notes at 100%
of their principal amount plus accrued and unpaid interest, if any,
thereon; (C) THIRD, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A) and (B), (w) to
the investment in or acquisition of Additional Assets, (x) the making
of Temporary Cash Investments or (y) any other purpose otherwise
permitted under this Indenture, in each case within the later of 45
days after the application of Net Available Cash in accordance with
clauses (A) or (B) or the date that is one year from the receipt of
such Net Available Cash; PROVIDED, HOWEVER, that, in connection with
any prepayment, repayment or purchase of Indebtedness pursuant to
clause (A) or (B) above, the Company or such Restricted Subsidiary
shall retire such Indebtedness and shall cause the related loan
commitment (if any) to be permanently reduced in an amount equal to the
principal amount so prepaid,
-51-
58
repaid or purchased. Notwithstanding the foregoing provisions, the
Company and its Restricted Subsidiaries shall not be required to apply
any Net Available Cash in accordance herewith except to the extent that
the aggregate Net Available Cash from all Asset Dispositions which are
not applied in accordance with this covenant at any time exceeds $10.0
million. The Company shall not be required to make an offer for Notes
pursuant to this covenant if the Net Available Cash available therefor
(after application of the proceeds as provided in clause (A)) is less
than $10.0 million for any particular Asset Disposition (which lesser
amounts shall be carried forward for purposes of determining whether an
offer is required with respect to the Net Available Cash from any
subsequent Asset Disposition).
For the purposes of this covenant, the following will be deemed to be
cash: (x) the assumption by the transferee of Senior Indebtedness of the Company
or Senior Indebtedness of any Restricted Subsidiary and the release of the
Company or such Restricted Subsidiary from all liability on such Senior
Indebtedness in connection with such Asset Disposition (in which case the
Company shall, without further action, be deemed to have applied such assumed
Indebtedness in accordance with clause (A) of the preceding paragraph) and (y)
securities received by the Company or any Restricted Subsidiary of the Company
from the transferee that are promptly (and in any event within 90 days)
converted by the Company or such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the
purchase of Notes pursuant to clause (a) (iii) (B), the Company will be
required to purchase Notes tendered pursuant to an offer by the Company
for the Notes at a purchase price of 100% of their principal amount
plus accrued and unpaid interest, if any, to the purchase date in
accordance with the procedures (including prorating in the event of
oversubscription) set forth in this Indenture. If the aggregate
purchase price of the Notes tendered pursuant to the offer is less than
the Net Available Cash allotted to the purchase of the Notes, the
Company will apply the remaining Net Available Cash in accordance with
clause (a) (iii) (C) above.
SECTION 4.11. LIMITATION ON AFFILIATE TRANSACTIONS.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or
conduct any transaction or series of related transactions (including
the purchase, sale, lease or exchange of any property or the rendering
of any service) with or for the benefit of any Affiliate of the
Company, other than the Company a Wholly-Owned Subsidiary (an
"Affiliate Transaction"), unless: (i) the terms of such Affiliate
Transaction are no less favorable to the Company or such Restricted
Subsidiary, as the case may be, than those that could be obtained at
the time of such transaction in arm's length dealings with a Person who
is not such an Affiliate; (ii) in the event such Affiliate Transaction
involves an aggregate amount in excess of $1 million or is a loan,
advance or other indebtedness, the terms of such transaction have been
approved by a majority of the disinterested members of the Board, if
any (and such
-52-
59
majority determines that such Affiliate Transaction satisfies the
criteria in clause (i) above); and (iii) in the event such Affiliate
Transaction involves an aggregate amount in excess of $2.0 million, the
Company has received a written opinion from an independent investment
banking, accounting or appraisal firm of nationally recognized standing
that such Affiliate Transaction is fair to the Company or such
Restricted Subsidiary, as the case may be, from a financial point of
view.
(b) The foregoing paragraph (a) shall not apply to (i) the
Company's employee compensation and other benefit arrangements
(including, without limitation, any option grants or other equity based
awards, (ii) loans or advances to employees in the ordinary course of
business of the Company or any of its Restricted Subsidiaries in
aggregate amount outstanding not to exceed $250,000 to any employee or
$500,000 in the aggregate at any time, (iii) the payment of reasonable
and customary fees to directors of the Company who are not employees of
the Company (including without limitation the grant of stock options),
(iv) indemnification agreements with, and the payment of fees and
indemnities to, directors, officers and employees of the Company and
its Restricted Subsidiaries, in each case in the ordinary course of
business, (v) transactions pursuant to agreements in existence on the
Issue Date which are (x) described in the Offering Memorandum or (y)
otherwise, in the aggregate, immaterial to the Company and its
Restricted Subsidiaries taken as a whole, and, in either case, are
effected pursuant to the terms of agreements as in effect on the Issue
Date, and (vi) transactions with respect to the acquisition of Accounts
Receivable and/or direct sales of Accounts Receivable to financial
institutions or sales of Accounts Receivable in connection with
securitization transactions, in each case in the ordinary course of
business.
SECTION 4.12. LIMITATION ON LIENS.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume or suffer to exist any Liens,
except for Permitted Liens.
SECTION 4.13. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall 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,
in accordance with the respective organizational documents (as the same may be
amended from time to time) of each Subsidiary and the rights (charter and
statutory), licenses and franchises of the Company and its Subsidiaries;
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 Board of Directors of the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Company and its Subsidiaries, taken as a whole, and that the loss thereof
is not adverse in any material respect to the Noteholders.
-53-
60
SECTION 4.14. CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control each Holder
will have the right to require the Company to repurchase all or any
part of such Holder's Notes at a purchase price in cash equal to 101%
of the principal amount thereof plus accrued and unpaid interest, if
any, to the date of purchase (the "Change of Control Payment") (subject
to the right of Holders of record on a relevant Record Date to receive
interest due on the relevant Interest Payment Date).
(b) Within 30 days following any Change of Control, unless the
Company has mailed a redemption notice with respect to all the
outstanding Notes in connection with such Change of Control, the
Company shall mail a notice to each Holder with a copy to the Notes
Trustee or, at the Company's option, by the Notes Trustee (at the
Company's expense) stating:
(i) that a Change of Control has occurred and
that such Holder has the right to require
the Company to purchase such Holder's Notes
at a purchase price in cash equal to 101% of
the principal amount thereof plus accrued
and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of
record on a Record Date to receive interest
on the relevant Interest Payment Date);
(ii) the repurchase date (which shall be no
earlier than 30 days nor later than 60 days
from the date such notice is mailed) (the
"Change of Control Payment Date"); and
(iii) the procedures determined by the Company,
consistent with this Indenture, that a
Noteholder must follow in order to have its
Notes purchased.
The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other applicable
securities laws or regulations in connection with the repurchase of Notes
pursuant to this Section 4.14. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Indenture, the
Company will comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations described in this Indenture
by virtue thereof.
(c) Noteholders electing to have a Note repurchased will be
required to surrender the Note, with the form entitled "Option of
Noteholder to Elect Purchase" on the reverse of the Note completed, to
the Company at the address specified in the notice at least 10 Business
Days prior to the repurchase date. Noteholders will be entitled to
withdraw their election if the Notes Trustee or the Company receives,
not later than three Business Days prior to the repurchase date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Noteholder, the principal amount of the Note which was
-54-
61
delivered for repurchase by the Noteholder and a statement that such
Noteholder is withdrawing his election to have such Note purchased.
(d) On the Change of Control Payment Date, the Company will,
to the extent lawful, (i) accept for payment all Notes or portions
thereof properly tendered pursuant to the Change of Control Offer, (ii)
deposit with the Notes Trustee an amount equal to the Change of Control
Payment in respect of all Notes or portions thereof so tendered and
(iii) deliver or cause to be delivered to the Notes Trustee the Notes
so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased
by the Company. The Notes Trustee will promptly mail to each Noteholder
so tendered the Change of Control Payment for such Notes, and the Notes
Trustee will promptly authenticate and mail (or cause to be transferred
by book entry) to each Noteholder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided
that each such new Note will be in a principal amount of $1,000 or an
integral multiple thereof. Unless the Company defaults in the payment
for any Notes properly tendered pursuant to the Change of Control
Offer, any Notes accepted for payment pursuant to the Change of Control
Offer shall cease to accrue interest after the Change of Control
Payment Date.
SECTION 4.15. LIMITATION ON ISSUANCES OF CAPITAL STOCK OF RESTRICTED
SUBSIDIARIES.
The Company will not permit any of its Restricted Subsidiaries to issue
any Capital Stock to any Person (other than to the Company or a Wholly-Owned
Subsidiary of the Company) or permit any Person (other than the Company or a
Wholly-Owned Subsidiary of the Company and other than directors' qualifying
shares and, to the extent required by local ownership in foreign countries,
shares owned by foreign shareholders) to own any Capital Stock of a Restricted
Subsidiary of the Company, if in either case as a result thereof such Restricted
Subsidiary would no longer be a Restricted Subsidiary of the Company; PROVIDED,
HOWEVER, that this provision shall not prohibit (x) the Company or any of its
Restricted Subsidiaries from selling, leasing or otherwise disposing of all of
the Capital Stock of any Restricted Subsidiary, provided that the net cash
proceeds from such sale, lease or other disposition are applied in accordance
with Section 4.10 or (y) the designation of a Restricted Subsidiary as an
Unrestricted Subsidiary in compliance with this Indenture.
SECTION 4.16. LIMITATION ON REPAYMENT UPON A CHANGE OF CONTROL.
The Company will not make an offer to repurchase any Subordinated
Obligations if it is required to do so pursuant to a Change of Control until at
least 60 days after the occurrence of such Change of Control and shall not
purchase any Subordinated Obligations for 30 days following the time the Company
is required to make purchases of the Notes under this Indenture following such
Change of Control.
-55-
62
SECTION 4.17. LIMITATION ON SALE/LEASEBACK TRANSACTIONS.
The Company will not, and will not permit any Restricted Subsidiary to,
directly or indirectly, enter into, Guarantee or otherwise become liable with
respect to any Sale/Leaseback Transaction with respect to any property or assets
unless (i) the Company or such Restricted Subsidiary, as the case may be, would
be entitled pursuant to this Indenture to Incur Indebtedness secured by a
Permitted Lien on such property or assets in an amount equal to the Attributable
Indebtedness with respect to such Sale/Leaseback Transaction, (ii) the Net Cash
Proceeds from such Sale/Leaseback Transaction are at least equal to the fair
market value of the property or assets subject to such Sale/Leaseback
Transaction (such fair market value determined, in the event such property or
assets have a fair market value in excess of $1.0 million, no more than 30 days
prior to the effective date of such Sale/ Leaseback Transaction, by the Board of
Directors of the Company as evidenced by a resolution of such Board of
Directors) and (iii) the net cash proceeds of such Sale/Leaseback Transaction
are applied in accordance with the provisions described under Section 4.10.
SECTION 4.18. LIMITATION ON DESIGNATIONS OF UNRESTRICTED SUBSIDIARIES.
(a) The Company may designate any Subsidiary of the Company
(other than a Subsidiary of the Company which owns Capital Stock of a
Restricted Subsidiary) as an "Unrestricted Subsidiary" under this
Indenture (a "Designation") only if:
(i) no Default or Event of Default shall have
occurred and be continuing at the time of
or, after giving effect to such Designation;
and
(ii) except in the case of a newly organized
Subsidiary in which the Company and the
Restricted Subsidiaries have made aggregate
investments of $10,000 or less, the Company
would be permitted under this Indenture to
make an Investment at the time of
Designation (assuming the effectiveness of
such Designation) in an amount (the
"Designation Amount") equal to the sum of
(i) the fair market value of the Capital
Stock of such Subsidiary owned by the
Company and the Restricted Subsidiaries on
such date and (ii) the aggregate amount of
other Investments of the Company and the
Restricted Subsidiaries in such Subsidiary
on such date; and
(iii) the Company would be permitted to Incur
$1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to Section
4.09 at the time of Designation (assuming
the effectiveness of such Designation).
(b) In the event of any such Designation, the Company shall be
deemed to have made an Investment constituting a Restricted Payment
pursuant to the covenant described
-56-
63
under Section 4.07 for all purposes of this Indenture in the
Designation Amount. The Company shall not, and shall not permit any
Restricted Subsidiary to, at any time (i) provide direct or indirect
credit support for or a Guarantee of any Indebtedness of any
Unrestricted Subsidiary (including of any undertaking, agreement or
instrument evidencing such Indebtedness), (ii) be directly or
indirectly liable for any Indebtedness of any Unrestricted Subsidiary
or (iii) be directly or indirectly liable for any Indebtedness of any
Unrestricted which provides that the holder thereof may (upon notice,
lapse of time or both) declare a default thereon or cause the payment
thereof to be accelerated or payable prior to its final scheduled
maturity upon the occurrence of a default with respect to any
Indebtedness of any Unrestricted Subsidiary (including any right to
take enforcement action against such Unrestricted Subsidiary), except,
in the case of clause (i) or (ii), to the extent permitted under
Section 4.07.
The Company may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary (a "Revocation"), whereupon such Subsidiary shall then
constitute a Restricted Subsidiary, if:
(i) no Default or Event of Default shall have
occurred and be continuing at the time of
and after giving effect to such Revocation;
and
(ii) all Liens and Indebtedness of such
Unrestricted Subsidiary outstanding
immediately following such Revocation would,
if incurred at such time, have been
permitted to be incurred for all purposes of
this Indenture.
All Designations and Revocations must be evidenced by Board Resolutions
of the Company delivered to the Notes Trustee certifying compliance with the
foregoing provisions.
SECTION 4.19. FURTHER INSTRUMENTS AND ACTS.
The Notes Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the part
of the Company, except as otherwise set forth herein, but the Notes Trustee may
require of the Company full information and advice as to the performance of the
covenants, conditions and agreements contained herein, and upon request of the
Notes Trustee, the Company will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
SECTION 4.20. COMPANY TO CAUSE CERTAIN SUBSIDIARIES TO BECOME
GUARANTORS.
The Company shall not (i) permit any of its Restricted Subsidiaries to
incur, guarantee or secure through the granting of Liens any Indebtedness or
(ii) pledge any intercompany notes representing obligations of any of its
Restricted Subsidiaries to secure the payment of any
-57-
64
Indebtedness, in either case unless such Restricted Subsidiary is a Wholly Owned
Subsidiary which is a Subsidiary Guarantor or at such time becomes a Subsidiary
Guarantor by executing a supplemental indenture in which such Restricted
Subsidiary agrees to be bound by the terms of this Indenture as a Subsidiary
Guarantor and executes a Note Guarantee.
ARTICLE 5: SUCCESSORS
SECTION 5.01. LIMITATIONS ON MERGER, CONSOLIDATION OR SALE OF ASSETS.
The Company shall not consolidate with or merge with or into, or
convey, transfer or lease all or substantially all of its assets to, any Person,
unless:
(i) the resulting, surviving or transferee
Person (the "Successor Company") shall be a
corporation organized and existing under the
laws of the United States of America, any
State thereof or the District of Columbia
and the Successor Company (if not the
Company) shall expressly assume, by
supplemental indenture, executed and
delivered to the Notes Trustee, in form
satisfactory to the Notes Trustee, all the
obligations of the Company under the Notes
and this Indenture;
(ii) immediately after giving effect to such
transaction (and treating any Indebtedness
that becomes an obligation of the Successor
Company or any Subsidiary of the Successor
Company as a result of such transaction as
having been incurred by the Successor
Company or such Restricted Subsidiary at the
time of such transaction), no Default or
Event of Default shall have occurred and be
continuing;
(iii) immediately after giving effect to such
transaction, the Successor Company (A) would
have a Consolidated Net Worth equal to or
greater than the Consolidated Net Worth of
the Company immediately prior to such
transaction and (B) would be able to Incur
at least an additional $1.00 of Indebtedness
pursuant to paragraph (a) of Section 4.09;
(iv) there has been delivered to the Notes
Trustee an Opinion of Counsel to the effect
that Holders of the Notes will not recognize
income, gain or loss for U.S. Federal income
tax purposes as a result of such
consolidation, merger, conveyance, transfer
or lease and will be subject to U.S. Federal
income tax on the same amount and in the
same manner and at the same times as would
have been
-58-
65
the case if such consolidation, merger,
conveyance, transfer or lease had not
occurred; and
(v) the Company shall have delivered to the
Notes Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that
such consolidation, merger or transfer and
such supplemental indenture (if any) comply
with this Indenture.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
The Successor Company will succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture, but, in the
case of a lease of all or substantially all its assets, the Company will not be
released from the obligation to pay the principal of and interest on the Notes.
Notwithstanding clauses (ii) and (iii) of Section 5.01, any Restricted
Subsidiary of the Company may consolidate with, merge into or transfer all or
part of its properties and assets to the Company or any other Restricted
Subsidiary.
ARTICLE 6: DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
(a) an "Event of Default" occurs if:
(i) there is a default in any payment of
interest on any Note when due, continued for
30 days;
(ii) there is a default in the payment of
principal of any Note when due at its Stated
Maturity, upon optional redemption, upon
required repurchase, upon declaration or
otherwise;
(iii) there is a failure by the Company to comply
with its obligations under Section 5.01
hereof;
(iv) there is failure by the Company to comply
for 30 days after notice by the trustee or
holders of not less than 25% of the
aggregate principal amount of Notes then
outstanding with any of the Company's
obligations under Sections 4.01, 4.03, 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.14, 4.15,
4.16, 4.17 or 4.18 hereof (in each case,
other than a failure to purchase Notes which
shall constitute an Event of Default under
clause (ii) above);
-59-
66
(v) there is a failure by the Company or any
Subsidiary Guarantor to comply for 60 days
after notice with its other agreements
contained in this Indenture;
(vi) Indebtedness of the Company or any
Restricted Subsidiary is not paid within any
applicable grace period after final maturity
or is accelerated by the holders thereof
because of a default and the total amount of
such Indebtedness unpaid or accelerated
exceeds $2.0 million and such default shall
not have been cured or such acceleration
rescinded after a 20-day period;
(vii) any judgment or decree for the payment of
money in excess of $2.0 million (to the
extent not covered by insurance) is rendered
against the Company or a Significant
Subsidiary and such judgment or decree shall
remain undischarged or unstayed for a period
of 60 days after such judgment becomes final
and non-appealable;
(viii) any Note Guarantee by a Significant
Subsidiary ceases to be in full force and
effect (except as contemplated by the terms
of this Indenture) or any Subsidiary
Guarantor that is a Significant Subsidiary
denies or disaffirms its obligations under
this Indenture or its Note Guarantee and
such Default continues for 10 days;
(ix) an event of default under, or if none is
specified therein, a failure to comply with
any provision of any Mortgage and the
continuance of such event of default or
failure to comply, as the case may be, for a
period of 30 days after written notice is
given by the Notes Trustee to the Company or
to the Company and the Notes Trustee by the
holders of at least 25% in aggregate
principal amount of the Notes outstanding;
or
(x) the Company or any of its Significant
Subsidiaries pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order
for relief against it in an
involuntary case,
(C) consents to the appointment of a
Custodian of it or for all or
substantially all of its property,
(D) makes a general assignment for the
benefit of its creditors,
-60-
67
(E) consents to or acquiesces in the
institution of a bankruptcy or an
insolvency proceeding against it,
or
(F) takes any corporate action to
authorize or effect any of the
foregoing; or
(xi) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law
that:
(A) is for relief against the Company
or any of its Significant
Subsidiaries in an involuntary
case,
(B) appoints a Custodian of the Company
or any of its Significant
Subsidiaries or for all or
substantially all of the property
of the Company or any of its
Significant Subsidiaries, or
(C) orders the liquidation of the
Company or any of its Significant
Subsidiaries, and the order or
decree remains unstayed and in
effect for 60 consecutive days.
(b) The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
(c) A Default under clause (iv) or (v) of Section 6.01(a)
hereof will not constitute an Event of Default until the Notes Trustee
notifies the Company or such Subsidiary Guarantor, as the case may be,
or the Holders of 25% in principal amount of the outstanding Notes
notifies the Company or such Subsidiary Guarantor, as the case may be,
and the Notes Trustee of the Default and the Company or such Subsidiary
Guarantor, as the case may be, does not cure such Default within the
time specified in such clause (iv) or (v) after receipt of the notice.
The written notice must specify the Default, demand that it be remedied
and state that the notice is a "Notice of Default."
SECTION 6.02. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clause (ix) or (x) of Section 6.01(a) with respect to the Company or any
Subsidiary Guarantor) occurs and is continuing, the Notes Trustee by notice to
the Company, or the Holders of not less than 25% in aggregate principal amount
of the then outstanding Notes by notice to the Company and the Notes Trustee,
may declare (a "Declaration") the unpaid principal of, and any accrued and
unpaid interest on, all the Notes to be due and payable (the "Default Amount").
Upon any such
-61-
68
Declaration the Default Amount shall be due and payable immediately. If an Event
of Default specified in clause (x) of Section 6.01(a) occurs with respect to the
Company or any of the Subsidiary Guarantors, the Default Amount shall ipso facto
become and be immediately due and payable without any Declaration or other act
on the part of the Notes Trustee or any Noteholder. The Holders of a majority in
aggregate principal amount of the then outstanding Notes by written notice to
the Notes Trustee and to the Company may rescind any Declaration if the
rescission would not conflict with any judgment or decree and if all Events of
Default then continuing (other than any Events of Default with respect to the
nonpayment of principal of or interest on any Note which has become due solely
as a result of such Declaration) have been cured and the Notes Trustee has been
paid all amounts due to it under Section 7.07, and may waive any Default other
than a Default with respect to a covenant or provision that cannot be modified
or amended without the consent of each Noteholder pursuant to Section 9.02
hereof.
SECTION 6.03. OTHER REMEDIES.
(a) If an Event of Default occurs and is continuing, the Notes
Trustee and the Noteholders may pursue any available remedy to collect
the payment of principal, premium, if any, or interest on the Notes or
to enforce the performance of any provision of the Notes or this
Indenture.
(b) The Notes 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 Notes Trustee or any
Noteholder 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 6.04. WAIVER OF PAST DEFAULTS.
Noteholders of not less than a majority in aggregate principal amount
of the then outstanding Notes by notice to the Notes Trustee may, on behalf of
all the Noteholders, waive an existing Default or Event of Default and its
consequences, except a continuing Default or Event of Default in the payment of
the principal, premium, if any, or interest on any Note (other than principal,
premium (if any) or interest which has become due solely as a result of a
Declaration) or a Default or Event of Default that cannot be modified or amended
without the consent of the Holder of each outstanding Note affected. Upon any
such waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Noteholders of a majority in principal amount of the Notes then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Notes
-62-
69
Trustee or exercising any trust or power conferred on it. However, the Notes
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that the Notes Trustee determines may be unduly prejudicial to the
rights of other Noteholders or that may involve the Notes Trustee in personal
liability. The Notes Trustee may take any other action deemed proper by the
Notes Trustee that is not inconsistent with such direction. Prior to taking any
action under this Indenture, the Notes Trustee shall be entitled to
indemnification satisfactory to it in its sole discretion against all losses and
expenses caused by taking or not taking such action.
SECTION 6.06. LIMITATION ON SUITS.
(a) Except to enforce the right to receive payment of
principal, premium (if any) or interest when due, a Noteholder may
pursue a remedy with respect to this Indenture or the Notes only if:
(i) the Noteholder has previously given to the
Notes Trustee written notice of a continuing
Event of Default;
(ii) the Holders of at least 25% in principal
amount of the then outstanding Notes make a
written request to the Notes Trustee to
pursue the remedy;
(iii) such Noteholder or Noteholders offer, and,
if requested, provide, to the Notes Trustee
indemnity satisfactory to the Notes Trustee
against any loss, liability or expense;
(iv) the Notes Trustee does not comply with the
request within 60 days after receipt of the
request and the offer and, if requested, the
provision of indemnity; and
(v) during such 60-day period the Holders of a
majority in principal amount of the then
outstanding Notes do not give the Notes
Trustee, in the reasonable opinion of such
Notes Trustee, a direction inconsistent with
the request.
(b) A Noteholder may not use this Indenture to prejudice the
rights of another Noteholder or to obtain a preference or priority over
another Noteholder.
SECTION 6.07. RIGHTS OF NOTEHOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Noteholder to receive payment of principal, premium, if any, interest on the
Note, 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 Noteholder.
-63-
70
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a)(i) or (ii) or an
acceleration pursuant to Section 6.02 occurs and is continuing, the Notes
Trustee is authorized to recover judgment in its own name and as trustee of an
express trust against the Company or any Subsidiary Guarantor or any other
obligor on the Notes for the whole amount of principal, premium, if any, and
accrued interest remaining unpaid on the Notes and interest on overdue
principal, premium, if any, and, to the extent lawful, interest on overdue
installments of interest and such further amount as shall be sufficient to cover
the costs and expenses of collection, including any advances made by the Notes
Trustee and the reasonable compensation, expenses and disbursements of the Notes
Trustee, its agents and counsel, and any other amounts due the Notes Trustee
under Section 7.07.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Notes Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Notes Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Notes Trustee, its agents and
counsel, and any other amounts due the Notes Trustee under Section 7.07) and the
Noteholders allowed in any judicial proceedings relative to the Company or any
Subsidiary Guarantor (or any other obligor on the Notes), its creditors or its
property and shall be entitled and empowered to collect, receive and distribute
any money or other property payable or deliverable on any such claims and any
custodian in any such judicial proceeding is hereby authorized by each
Noteholder to make such payments to the Notes Trustee, and in the event that the
Notes Trustee shall consent to the making of such payments directly to the
Noteholders, to pay to the Notes Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Notes Trustee, its
agents and counsel, and any other amounts due the Notes Trustee under Section
7.07 hereof. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Notes Trustee, its agents and counsel, and any
other amounts due the Notes Trustee under Section 7.07 hereof out of the estate
in any such proceeding, shall be denied for any reason, payment of the same
shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties which the
Noteholders may be entitled to receive in such proceeding whether in liquidation
or under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Notes Trustee to authorize or consent
to or accept or adopt on behalf of any Noteholder any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any
Noteholder thereof, or to authorize the Notes Trustee to vote in respect of the
claim of any Noteholder in any such proceeding.
SECTION 6.10. PRIORITIES.
(a) If the Notes Trustee collects any money pursuant to this
Article, it shall pay out the money in the following order:
-64-
71
(i) First: to the Notes Trustee, its agents and
attorneys for amounts due under Section
7.07, including payment of all compensation,
expenses and liabilities incurred, and all
advances made, by the Notes Trustee and the
costs and expenses of collection;
(ii) Second: if the Noteholders are forced to
proceed against the Company directly without
the Notes Trustee, to the Noteholders for
their collection costs;
(iii) Third: to the Noteholders for amounts due
and unpaid on the Notes for principal,
premium, if any, and interest, ratably,
without preference or priority of any kind,
according to the amounts due and payable on
the Notes for principal, premium, if any,
and interest, respectively; and
(iv) Fourth: to the Company or, to the extent the
Notes Trustee collects any amount pursuant
to Article 10 hereof from any Subsidiary
Guarantor, to such Subsidiary Guarantor, or
to such party as a court of competent
jurisdiction shall direct.
(b) The Notes Trustee may fix a record date and payment date
for any payment to Noteholders. At least 15 calendar days before such
record date, the Company shall mail to each Holder and the Notes
Trustee a notice that states the record date, the payment date and the
amount to be paid.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Notes Trustee for any action taken or
omitted by it as a Notes 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 does not apply to a suit by the Notes Trustee, a suit by
a Noteholder pursuant to Section 6.07 hereof, or a suit by Holders of more than
10% in principal amount of the then outstanding Notes.
ARTICLE 7: TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Notes Trustee shall exercise such of the rights and powers vested in it
by this Indenture, and use the same
-65-
72
degree of care and skill in their exercise as a prudent person would
exercise or use under the circumstances and in the conduct of his own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the Notes Trustee undertakes to perform only
those duties as are specifically set forth
in this Indenture and the duties of the
Notes Trustee shall be determined solely by
the express provisions of this Indenture,
the Notes Trustee need perform only those
duties that are specifically set forth in
this Indenture and no others, and no implied
covenants or obligations shall be read into
this Indenture against the Notes Trustee;
and
(ii) in the absence of bad faith on its part, the
Notes Trustee may conclusively rely, as to
the truth of the statements and the
correctness of the opinions expressed
therein, upon any certificates or opinions
furnished to the Notes Trustee and
conforming to the requirements of this
Indenture, but in the case of any such
certificates or opinions which by any
provision hereof are specifically required
to be furnished to the Notes Trustee, the
Notes Trustee shall examine the same to
determine whether or not they conform to the
requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained,
the Notes Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(ii) the Notes Trustee shall not be liable for
any error of judgment made in good faith by
a Responsible Officer, unless it is proved
that the Notes Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Notes 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
6.05 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Notes
Trustee is subject to paragraphs (a), (b), and (c) of this Section
7.01.
-66-
73
(e) No provision of this Indenture shall require the Notes
Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder
or in the exercise of any of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably
assured to it.
(f) The Notes Trustee shall not be liable for interest on any
money received by it except as the Notes Trustee may agree in writing
with the Company. Assets held in trust by the Notes Trustee need not be
segregated from other funds except to the extent required by law.
(g) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Notes
Trustee shall be subject to the provisions of Section 7.01 and to the
provisions of the TIA.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Notes Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by
the proper Person. The Notes Trustee need not investigate any fact or
matter stated in the document unless the Notes Trustee has reason to
believe such fact or matter is not true.
(b) Before the Notes Trustee acts or refrains from acting, it
may require an Officers' Certificate or an Opinion of Counsel or both.
The Notes Trustee shall not be liable for any action it takes or omits
to take in good faith reliance on such Officers' Certificate or Opinion
of Counsel. The Notes Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Notes Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Notes 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 conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be
sufficient if signed by an Officer of the Company.
(f) The permissive rights of the Notes Trustee to do certain
things enumerated in this Indenture shall not be construed as a duty
and the Notes Trustee shall not be
-67-
74
answerable for other than its negligence or wilful default with respect
to such permissive rights.
(g) Except for (i) an Event of Default under 6.01(a)(i)
(except with respect to Additional Interest) or (ii) hereof, or (ii)
any other event of which the Notes Trustee has "actual knowledge,"
which event, with the giving of notice or the passage of time or both,
would constitute an Event of Default, the Notes Trustee shall not be
deemed to have notice of any Default or Event of Default unless
specifically notified in writing of such event by the Company or the
Noteholders of not less than 25% in aggregate principal amount of Notes
outstanding; as used herein, the term "actual knowledge" means the
actual fact or statement of knowing, without any duty to make any
investigation with regard thereto.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Notes Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company, any
Subsidiary Guarantor or any Affiliate of the Company or any Subsidiary Guarantor
with the same rights it would have if it were not Notes Trustee. Any Agent may
do the same with like rights. However, the Notes Trustee is subject to Sections
7.10 and 7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Notes Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Notes or
the Note Guarantees or the Mortgages, it shall not be accountable for the
Company's use of the proceeds from the Notes or any money paid to the Company or
upon the Company's direction under any provision of this Indenture, it shall not
be responsible for the use or application of any money received by any Paying
Agent other than the Notes Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Notes, the Note Guarantees
or the Mortgages, or any other document (including, without limitations, an
offering document) in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if a
Responsible Officer of the Notes Trustee has knowledge thereof, the Notes
Trustee shall mail to each Noteholder in the manner and to the extent provided
in TIA Section 313(a) a notice of the Default or Event of Default within 60 days
after it occurs. Except in the case of a Default or Event of Default in any
payment of principal, premium (if any) or interest on any Note, the Notes
Trustee may withhold the notice if and so long as its Board of Directors, a
committee of its Board of Directors or a committee of its officers in good faith
determines that withholding the notice is in the interest of the Noteholders.
-68-
75
SECTION 7.06. REPORTS BY TRUSTEE TO NOTEHOLDERS.
(a) Within 60 days after each April 1 beginning with the April
1 following the date of this Indenture, and for so long as the Notes
remain outstanding, the Notes Trustee shall mail to the Noteholders a
brief report dated as of such reporting date that complies with TIA
Section 313(a) (but if no event described in TIA Section 313(a) has
occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Notes Trustee also shall comply with
TIA Section 313(b) and Section 313(c).
(b) A copy of each report at the time of its mailing to the
Noteholders shall be filed with the Commission and each stock exchange,
if any, on which the Notes are listed, in accordance with and to the
extent required by TIA Section 313(d). The Company shall promptly
notify the Notes Trustee if and when the Notes are listed on any stock
exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
(a) The Company and the each of the Subsidiary Guarantors,
jointly and severally, shall pay to the Notes Trustee from time to time
reasonable compensation for its acceptance of this Indenture and
services hereunder, including extraordinary services such as default
administration. The Notes Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The
Company and each of the Subsidiary Guarantors, jointly and severally,
shall reimburse the Notes Trustee upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition
to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Notes
Trustee's agents and counsel.
(b) The Company and each of the Subsidiary Guarantors, jointly
and severally, shall indemnify the Notes Trustee against any and all
losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under
this Indenture, including the costs and expenses of enforcing this
Indenture against the Company (including this Section 7.07) and
defending itself against any claim (whether asserted by the Company,
any Holder or any other Person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder,
except as set forth below in subparagraph (d). The Notes Trustee shall
notify the Company and each of the Subsidiary Guarantors promptly of
any claim for which it may seek indemnity. Failure by the Notes Trustee
to so notify the Company or any Subsidiary Guarantor shall not relieve
the Company or any of the Subsidiary Guarantors of their Obligations
hereunder. The Notes Trustee may have separate counsel and the Company
and each of the Subsidiary Guarantors, jointly and severally, shall pay
the reasonable fees and expenses of such counsel. Neither the Company
nor any Subsidiary Guarantor need pay for any settlement made without
its consent, which consent shall not be unreasonably withheld.
-69-
76
(c) The obligations of the Company and each of the Subsidiary
Guarantors under this Section 7.07 shall survive the resignation or
removal of the Notes Trustee and the satisfaction and discharge or
termination of this Indenture.
(d) Notwithstanding subparagraphs (a) or (b) above, neither
the Company nor any Subsidiary Guarantor need reimburse any expense or
indemnify against any loss or liability incurred by the Notes Trustee
through its own negligence, bad faith or willful misconduct.
(e) To secure the Company's and each of the Subsidiary
Guarantor's payment obligations in this Section, the Notes Trustee
shall have a Lien prior to the Notes on all money or property held or
collected by the Notes Trustee, except that held in trust to pay
principal, premium, if any, and interest on particular Notes. Such Lien
shall survive the resignation or removal of the Notes Trustee and the
satisfaction and discharge or termination of this Indenture.
(f) When the Notes Trustee incurs expenses or renders services
after an Event of Default specified in Section 6.01(ix) or (x) hereof
occurs, the expenses and the compensation for such services (including
the reasonable fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy
Law.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
(a) A resignation or removal of the Notes Trustee and
appointment of a successor Notes Trustee shall become effective only
upon the successor Notes Trustee's acceptance of appointment as
provided in this Section 7.08.
(b) The Notes Trustee may resign at any time and be discharged
from the trust hereby created by so notifying the Company. The
Noteholders of a majority in principal amount of the then outstanding
Notes may remove the Notes Trustee by so notifying the Notes Trustee
and the Company. The Company may remove the Notes Trustee if:
(i) the Notes Trustee fails to comply with
Section 7.10 hereof;
(ii) the Notes Trustee is adjudged a bankrupt or
an insolvent or an order for relief is
entered with respect to the Notes Trustee
under any Bankruptcy Law;
(iii) a Custodian, receiver or other public
officer takes charge of the Notes Trustee or
its property; or
(iv) the Notes Trustee becomes incapable of
acting.
-70-
77
(c) If the Notes Trustee resigns or is removed or if a vacancy
exists in the office of Notes Trustee for any reason, the Company shall
notify each Noteholder of such event and promptly appoint a successor
Notes Trustee. Within one year after the successor Notes Trustee takes
office, the Holders of a majority in principal amount of the then
outstanding Notes may appoint a successor Notes Trustee to replace the
successor Notes Trustee appointed by the Company.
(d) A successor Notes Trustee shall deliver a written
acceptance of its appointment to the retiring Notes Trustee and to the
Company. Thereupon, the resignation or removal of the retiring Notes
Trustee shall become effective, and the successor Notes Trustee shall
have all the rights, powers and duties of the Notes Trustee under this
Indenture. The successor Notes Trustee shall mail a notice of its
succession to each Noteholder. The retiring Notes Trustee shall
promptly transfer all property held by it as Notes Trustee to the
successor Notes Trustee, provided all sums owing to the Notes Trustee
hereunder have been paid and subject to the Lien provided for in
Section 7.07 hereof. Notwithstanding replacement of the Notes Trustee
pursuant to this Section 7.08, the Company's and each of the Subsidiary
Guarantor's obligations under Section 7.07 hereof shall continue for
the benefit of the retiring Notes Trustee.
(e) If a successor Notes Trustee does not take office within
60 days after the retiring Notes Trustee resigns or is removed, the
retiring Notes Trustee, the Company, any of the Subsidiary Guarantors
or the Noteholders of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for
the appointment of a successor Notes Trustee.
(f) If the Notes Trustee after written request by any
Noteholder who has been a Noteholder for at least six months fails to
comply with Section 7.10, such Noteholder may petition any court of
competent jurisdiction for the removal of the Notes Trustee and the
appointment of a successor Notes Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Notes Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Notes Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
(a) There shall at all times be a Notes Trustee hereunder
which shall be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof
or the District of Columbia authorized under such laws to exercise
corporate trustee power, shall be subject to supervision or examination
by Federal, State, Territorial, or District of Columbia authority and
shall have (or be a part of
-71-
78
a holding company with) a combined capital and surplus of at least $100
million as set forth in its most recent published annual report of
condition.
(b) This Indenture shall always have a Notes Trustee who
satisfies the requirements of TIA Section 310(a)(1), (2) and (5). The
Notes Trustee shall comply with TIA Section 310(b). The provisions of
TIA Section 310 shall also apply to the Company and each of the
Subsidiary Guarantors, as obligor on the Notes.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Notes Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Notes Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein. The provisions of TIA Section 311 shall apply to the Company
and each of the Subsidiary Guarantors as obligor on the Notes.
ARTICLE 8: DISCHARGE OF INDENTURE
SECTION 8.01. DISCHARGE OF LIABILITY ON NOTES; DEFEASANCE.
(a) When (i) the Company delivers to the Notes Trustee all
outstanding Notes (other than Notes replaced pursuant to Section 2.07
hereof) canceled or for cancellation or (ii) all outstanding Notes have
become due and payable and the Company irrevocably deposits with the
Notes Trustee funds sufficient to pay at maturity all outstanding
Notes, including interest thereon (other than Notes replaced pursuant
to Section 2.07 hereof), and if in either case the Company pays all
other sums payable hereunder by the Company, then this Indenture shall,
subject to Sections 8.01(e) and 8.06 hereof, cease to be of further
effect. The Notes Trustee shall acknowledge satisfaction and discharge
of this Indenture on demand of the Company accompanied by an Officers'
Certificate and an Opinion of Counsel reasonably acceptable to the
Notes Trustee and at the cost and expense of the Company.
(b) Subject to Sections 8.01(e), 8.02 and 8.06 hereof, the
Company at any time may terminate (i) all its obligations under the
Notes and this Indenture ("legal defeasance option") or (ii) all
obligations under Sections 3.09, 4.04(a), (b) and (c), 4.05, 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.15, 4.16, 4.17, 4.18 and 5.01(iii) and
(v) ("covenant defeasance option"). The Company may exercise its legal
defeasance option notwithstanding its prior exercise of its covenant
defeasance option.
(c) If the Company exercises its legal defeasance option,
payment of the Notes may not be accelerated because of an Event of
Default. If the Company exercises its covenant defeasance option,
payment of the Notes may not be accelerated because of an Event of
Default specified in Section 6.01(a)(iv), 6.01(a)(vi), 6.01(a)(vii),
6.01(a)(viii) or
-72-
79
6.01(a)(ix) (but only with respect to Significant Subsidiaries) or
6.01(a)(x) hereof (but only with respect to Significant Subsidiaries),
or because of the failure of the Company or the Subsidiary Guarantors
to comply with Sections 5.01(iii) or 5.01(v).
(d) Upon satisfaction of the conditions set forth herein and
Section 8.02 and upon request of the Company, the Notes Trustee shall
acknowledge in writing the discharge of those obligations that the
Company terminates.
(e) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 7.07, 7.08,
8.01(d), 8.04, 8.05 and 8.06 hereof and the obligations of each
Subsidiary Guarantor under Article 10 in respect thereof shall survive
until the Notes have been paid in full. Thereafter, the Company's
obligations in Sections 7.07, 8.04, 8.05 and 8.08 hereof and the
obligations of each Subsidiary Guarantor under Article 10 in respect
thereof shall survive.
SECTION 8.02. CONDITIONS TO DEFEASANCE.
(a) The Company may exercise its legal defeasance option or
its covenant defeasance option only if:
(i) the Company irrevocably deposits in trust
with the Notes Trustee money or U.S.
Government Obligations in amounts (including
interest, but without consideration of any
reinvestment of such interest) and
maturities sufficient, but in the case of
the legal defeasance option only, not more
than such amounts (as certified by a
nationally recognized firm of independent
public accountants), to pay and discharge at
their Stated Maturity (or such earlier
redemption date as the Company shall have
specified to the Notes Trustee) the
principal of, premium, if any, interest on
all outstanding Notes to maturity or
redemption, as the case may be, and to pay
all of the sums payable by it hereunder;
provided, that the Notes Trustee shall have
been irrevocably instructed to apply such
money or the proceeds of such U.S.
Government Obligations to the payment of
said principal, premium, if any, and
interest with respect to the Notes;
(ii) in the case of the legal defeasance option
only, 123 days pass after the deposit is
made and during the 123-day period no
Default or Event of Default specified in
Section 6.01(ix) or (x) hereof with respect
to the Company or any Subsidiary Guarantor
occurs which is continuing at the end of the
period;
(iii) no Default or Event of Default has occurred
and is continuing on the date of such
deposit and after giving effect thereto;
-73-
80
(iv) the deposit does not constitute a default
under any other agreement binding on the
Company;
(v) the Company delivers to the Notes Trustee an
Opinion of Counsel to the effect that the
trust resulting from the deposit does not
constitute, or is qualified as, a regulated
investment company under the Investment
Company Act of 1940, as amended;
(vi) in the case of the legal defeasance option,
the Company shall have delivered to the
Notes Trustee an Opinion of Counsel stating
that (x) the Company has received from, or
there has been published by, the Internal
Revenue Service a ruling, or (y) since the
date of this Indenture there has been a
change in the applicable Federal income tax
law, in either case to the effect that, and
based thereon such Opinion of Counsel shall
confirm that, the Noteholders will not
recognize income, gain or loss for U.S.
Federal income tax purposes as a result of
such defeasance and will be subject to U.S.
Federal income tax on the same amounts, in
the same manner and at the same times as
would have been the case if such defeasance
had not occurred;
(vii) in the case of the covenant defeasance
option, the Company shall have delivered to
the Notes Trustee an Opinion of Counsel to
the effect that the Noteholders will not
recognize income, gain or loss for Federal
income tax purposes as a result of such
covenant defeasance and will be subject to
Federal income tax on the same amounts, in
the same manner and at the same times as
would have been the case if such covenant
defeasance had not occurred; and
(viii) the Company delivers to the Notes Trustee an
Officers' Certificate and an Opinion of
Counsel, each stating that all conditions
precedent to the defeasance and discharge of
the Notes as contemplated by this Article 8
have been complied with.
(b) In order to have money available on a payment date to pay
principal, premium, if any, or interest on the Notes, the U.S.
Government Obligations deposited pursuant to preceding clause (a) shall
be payable as to principal or interest at least one Business Day before
such payment date in such amounts as shall provide the necessary money.
U.S. Government Obligations shall not be callable at the issuer's
option.
(c) Before or after a deposit, the Company may make
arrangements satisfactory to the Notes Trustee for the redemption of
Notes at a future date in accordance with Article 3 hereof.
-74-
81
SECTION 8.03. APPLICATION OF TRUST MONEY.
The Notes Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to this Article 8. It shall apply the
deposited money and the money from U.S. Government Obligations through the
Paying Agent and in accordance with this Indenture to the payment of principal,
premium, if any, and interest on the Notes.
SECTION 8.04. REPAYMENT TO THE COMPANY.
(a) The Notes Trustee and the Paying Agent shall promptly pay
to the Company upon written request any excess money or securities held
by them at any time; PROVIDED, HOWEVER, that the Notes Trustee shall
not pay any such excess to the Company unless the amount remaining on
deposit with the Notes Trustee, after giving effect to such transfer
are sufficient to pay principal, premium, if any, and interest on the
outstanding Notes, which amount shall be certified to the Notes Trustee
by independent public accountants.
(b) The Notes Trustee and the Paying Agent shall pay to the
Company upon written request any money held by them for the payment of
principal, premium, if any, 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 either caused notice of
such payment to be mailed to each Noteholder entitled thereto no less
than 30 days prior to such repayment or within such period shall have
published such notice in a financial newspaper of widespread
circulation published in the City of New York. After payment to the
Company, Noteholders entitled to the money must look to the Company and
the Subsidiary Guarantors for payment as general creditors unless an
applicable abandoned property law designates another Person, and all
liability of the Notes Trustee and such Paying Agent with respect to
such money shall cease.
SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS.
The Company and the Subsidiary Guarantors, jointly and severally, shall
pay and shall indemnify the Notes Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S.
Government Obligations.
SECTION 8.06. REINSTATEMENT.
If the Notes Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with this Article 8 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and each of the Subsidiary Guarantor's Obligations
under this Indenture and the Notes and the Note Guarantees shall be revived and
reinstated as though no deposit had occurred pursuant to this Article 8 until
such time as the Notes Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in
-75-
82
accordance with this Article 8; PROVIDED, HOWEVER, that if the Company or any
Subsidiary Guarantor has made any payment of principal of, premium, if any, or
interest on any Notes because of the reinstatement of its Obligations, the
Company or any of the Subsidiary Guarantors, as the case may be, shall be
subrogated to the rights of the Noteholders to receive such payment from the
money or U.S. Government Obligations held by the Notes Trustee or Paying Agent.
ARTICLE 9: AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF NOTEHOLDERS.
(a) Notwithstanding Section 9.02 of this Indenture, the
Company, the Subsidiary Guarantors and the Notes Trustee may amend or
supplement this Indenture or the Notes without the consent of any
Noteholder:
(i) to cure any ambiguity, omission, defect or
inconsistency; provided, that such amendment
or supplement does not, as evidenced by an
Opinion of Counsel delivered to the Notes
Trustee, adversely affect the rights of any
Noteholder in any respect;
(ii) to comply with Article 5 hereof;
(iii) to provide for uncertificated Notes in
addition to or in place of certificated
Notes (provided, that the uncertificated
Notes are issued in registered form for
purposes of Section 163(f) of the Internal
Revenue Code, or in a manner such that the
uncertificated Notes are described in
Section 163(f)(2)(B) of the Internal Revenue
Code);
(iv) to add further Guarantees with respect to
the Notes or to secure the Notes with
additional collateral;
(v) to add to the covenants of the Company for
the benefit of the Noteholders or to
surrender any right or power conferred upon
the Company or the Guarantors;
(vi) to comply with requirements of the
Commission in order to effect or maintain
the qualification of this Indenture under
the TIA;
(vii) to make any change that would provide
additional rights or benefits to the Holders
of the Notes or that does not, as evidenced
by an Opinion of Counsel delivered to the
Notes Trustee, adversely affect the rights
of any Noteholder in any respect; or
-76-
83
(viii) to evidence or provide for a replacement
Notes Trustee under Section 7.08 hereof;
provided, that the Company has delivered to the Notes Trustee an
Opinion of Counsel stating that any such amendment or supplement
complies with the provisions of this Section 9.01.
(b) Upon the request of the Company and the Subsidiary
Guarantors accompanied by Board Resolutions of their respective Boards
of Directors authorizing the execution of any such supplemental
indenture, and upon receipt by the Notes Trustee of the documents
described in Section 7.02, Section 9.06 and Section 12.04 hereof, the
Notes Trustee shall join with the Company and the Subsidiary Guarantors
in the execution of any supplemental indenture authorized or permitted
by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the
Notes Trustee shall not be obligated to enter into such supplemental
indenture which affects its own rights, duties or immunities under this
Indenture or otherwise.
(c) After an amendment or supplement under this Section 9.01
becomes effective, the Company shall mail to all Noteholders a notice
briefly describing such amendment or supplement. The failure to give
such notice to all Noteholders, or any defect therein, shall not impair
or affect the validity of an amendment or supplement under this
Section.
SECTION 9.02. WITH CONSENT OF NOTEHOLDERS.
(a) Except as provided below in this Section 9.02, the Company
and the Notes Trustee may amend or supplement this Indenture or the
Notes with the written consent of the Noteholders of not less than a
majority in aggregate principal amount of the Notes then outstanding
(including consents obtained in connection with a purchase of, or
tender offer or exchange offer for the Notes) and subject to Section
6.04 and 6.07 any existing Default or Event of Default and its
consequences (other than a Default or Event of Default in the payment
of principal premium, if any, or interest, if any, on the Notes except
a payment default resulting from an acceleration of the Notes that has
been rescinded) or compliance with any provision of this Indenture or
the Notes may be waived with the consent of the Holders of a majority
in principal amount of the then outstanding Notes (including consents
obtained in connection with a purchase of, or tender offer or exchange
offer for the Notes). However, without the consent of each Noteholder
affected, an amendment, supplement or waiver under this Section 9.02
may not (with respect to any Notes held by a non-consenting Holder):
(i) reduce the principal amount of Notes whose
Holders must consent to an amendment,
supplement or waiver;
-77-
84
(ii) reduce the stated rate of or extend the
stated time for payment of any interest on
any Note;
(iii) reduce the principal of or extend the Stated
Maturity of any Note or alter the redemption
provisions (including without limitation
Sections 3.07, 3.09, 4.11 and 4.14 hereof)
with respect thereto;
(iv) reduce the premium payable upon the
redemption or repurchase of any Note or
change the time at which any Note may be
redeemed in accordance with Section 3.07;
(v) make any Note payable in money other than
that stated in the Note;
(vi) make any change in Section 6.04 or 6.07
hereof or in this Section 9.02(a);
(vii) waive a Default or Event of Default in the
payment of principal of premium, if any, or
interest, if any, on, or redemption payment
with respect to, any or Note (except a
rescission of acceleration of the Notes by
the Holders of at least a majority in
aggregate principal amount of the Notes and
a waiver of the payment default that
resulted from such acceleration);
(viii) impair the right of any Holder to receive
payment of principal of and interest on such
Holder's Notes on or after the due dates
therefor or to institute suit for the
enforcement of any payment on or with
respect to such Holder's Notes;
(ix) make any change in the amendment provisions
which require each Holder's consent or in
the waiver provisions; or
(b) Upon the request of the Company and the Subsidiary
Guarantors accompanied by Board Resolutions of their respective Boards
of Directors authorizing the execution of any such supplemental
indenture, and upon the filing with the Notes Trustee of evidence
satisfactory to the Notes Trustee of the consent of the Noteholders as
aforesaid, and upon receipt by the Notes Trustee of the documents
described in Section 7.02, Section 9.06 and Section 12.04 hereof, the
Notes Trustee shall join with the Company and the Subsidiary Guarantors
in the execution of such supplemental indenture unless such
supplemental indenture affects the Notes Trustee's own rights, duties
or immunities under this Indenture or otherwise, in which case the
Notes Trustee may in its discretion, but shall not be obligated to,
enter into such supplemental indenture.
-78-
85
(c) It shall not be necessary for the consent of the
Noteholders under this Section 9.02 to approve the particular form of
any proposed amendment, supplement or waiver, but it shall be
sufficient if such consent approves the substance thereof.
(d) After an amendment, supplement or waiver under this
Section 9.02 becomes effective, the Company shall mail to all
Noteholders a notice briefly describing the amendment, supplement or
waiver. Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity
of any such amendment, supplement or waiver.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall
comply with the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
(a) Until an amendment, supplement or waiver becomes
effective, a consent to it by a Noteholder is a continuing consent by
the Noteholder and every subsequent Noteholder 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
Noteholder or subsequent Noteholder may revoke the consent as to its
Note if the Notes Trustee receives written notice of revocation before
the date the waiver, supplement or amendment becomes effective. an
amendment, supplement or waiver becomes effective when approved by the
requisite Holders and executed by the Notes Trustee (or, if otherwise
provided in such waiver, amendment or supplement, in accordance with
its terms) and thereafter binds every Noteholder, unless it makes a
change described in any of clauses (i) through (x) of Section 9.02, in
which case, the amendment, supplement or waiver shall bind only each
Holder of a Note who has consented to it and every subsequent Holder of
a Note or portion of a Note that evidences the same indebtedness as the
consenting Holder's Note.
(b) The Company may fix a record date for determining which
Noteholders must consent to such amendment, supplement or waiver. If
the Company fixes a record date, the record date shall be fixed at (i)
the later of 30 days prior to the first solicitation of such consent or
the date of the most recent list of Noteholders furnished to the Notes
Trustee prior to such solicitation pursuant to Section 2.05 hereof, or
(ii) such other date as the Company shall designate. If a record date
is fixed, then notwithstanding the last sentence 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 or waiver or 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 except to the extent that the
requisite number of consents to the amendment, supplement or waiver
-79-
86
have been obtained within such 90-day period or as set forth in the
preceding paragraph of this Section 9.04.
SECTION 9.05. NOTATION ON OR EXCHANGE OF NOTES.
(a) Notes authenticated and delivered after the execution of
any supplemental indenture may bear a notation in form approved by the
Notes Trustee as to any matter provided for in such amendment,
supplement or waiver on any Note thereafter authenticated. The Company
in exchange for all Notes may issue and the Notes Trustee shall
authenticate new Notes that reflect the amendment, supplement or
waiver.
(b) Failure to make the appropriate notation or issue a new
Note shall not affect the validity and effect of such amendment,
supplement or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Notes Trustee shall sign any amendment, waiver or supplemental
indenture authorized pursuant to this Article 9 if the amendment, waiver or
supplemental indenture does not adversely affect the rights, duties, liabilities
or immunities of the Notes Trustee. If it does, the Notes Trustee may, but need
not, sign it. In signing or refusing to sign such amendment, waiver or
supplemental indenture, the Notes Trustee shall be entitled to receive and,
subject to Section 7.01, shall be fully protected in relying upon, in addition
to the documents required by Section 7.02 and Section 12.04, an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that such
amendment, waiver or supplemental indenture is authorized or permitted by this
Indenture, that it is not inconsistent herewith, and that it will be valid and
binding upon the Company in accordance with its terms.
ARTICLE 10: SUBSIDIARY GUARANTEES OF NOTES
SECTION 10.01. NOTE GUARANTEE
(a) Each Subsidiary Guarantor hereby jointly and severally
irrevocably and unconditionally guarantees, as a primary obligor and
not a surety, to each Noteholder of a Note now or hereafter
authenticated and delivered by the Notes Trustee and to the Notes
Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Notes or the Obligations of
the Company hereunder or thereunder, (i) the due and punctual payment
of the principal, premium, if any, interest (including post-petition
interest in any proceeding under any Bankruptcy Law whether or not an
allowed claim in such proceeding) on overdue principal, premium, if
any, and interest, if lawful on such Note, and (ii) all other monetary
Obligations payable by the Company under this Indenture (including
under Section 7.07 hereof) and the Notes (all of the foregoing being
hereinafter collectively called the "Guaranteed Obligations"), when and
as the same shall become due and payable, whether by acceleration
thereof, call for redemption or
-80-
87
otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy
Code), in accordance with the terms of any such Note and of this
Indenture, subject, however, in the case of (i) and (ii) above, to the
limitations set forth in Section 10.04 hereof. Each Subsidiary
Guarantor hereby agrees that its Obligations hereunder shall be
absolute and unconditional, irrespective of, and shall be unaffected
by, the validity or enforceability of the Notes or obligations of the
Company under the Indenture, any failure to enforce the provisions of
any such Note or this Indenture, other than waivers granted by
Noteholders, the recovery of any judgment against the Company, any
action to enforce the same, by the Noteholders or the Notes Trustee, or
any other circumstances which may otherwise constitute a legal or
equitable discharge of a surety or guarantor. Each Subsidiary Guarantor
hereby waives diligence, presentment, filing of claims with a court in
the event of a merger or bankruptcy of the Company, any right to
require a proceeding first against the Company, the benefit of
discussion, protest or notice with respect to any such Note or the
Indebtedness evidenced thereby and all demands whatsoever, and
covenants that this Note Guarantee shall not be discharged as to any
such Note except by payment in full of the principal thereof, premium,
if any, and all accrued interest thereon.
(b) Each Subsidiary Guarantor further agrees that this Note
Guarantee herein constitutes a guarantee of payment, performance and
compliance when due (and not a guarantee of collection) and waives any
right to require that any resort be had by any Noteholder or the Notes
Trustee to any Note held for payment of the Guaranteed Obligations.
(c) Each Subsidiary Guarantor agrees that it shall not be
entitled to, and hereby irrevocably waives, any right of subrogation in
relation to the Noteholders or the Notes Trustee in respect of any
Guaranteed Obligations. Each Subsidiary Guarantor further agrees that,
as between such Subsidiary Guarantor, on the one hand, and the
Noteholders and the Notes Trustee, on the other hand, (x) the maturity
of the Guaranteed Obligations may be accelerated as provided in Article
6 for the purposes of such Subsidiary Guarantor's Note Guarantee
herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Guaranteed Obligations,
and (y) in the event of any Declaration of acceleration of such
Guaranteed Obligations as provided in Article 6 hereof, such Guaranteed
Obligations (whether or not due and payable) shall forthwith become due
and payable by such Subsidiary Guarantor for the purpose of this
Article 10.
(d) Each Subsidiary Guarantor also agrees to pay any and all
costs and expenses (including reasonable attorneys' fees) incurred by
the Notes Trustee or any Noteholder in enforcing any rights under this
Article 10.
(e) The Note Guarantee set forth in this Article 10 shall not
be valid or become obligatory for any purpose with respect to a Note
until the certificate of authentication on such Note shall have been
signed by or on behalf of the Notes Trustee.
-81-
88
SECTION 10.02. EXECUTION AND DELIVERY OF NOTE GUARANTEE.
(a) To evidence each Subsidiary Guarantor's Note Guarantee set
forth in this Article 10, each Subsidiary Guarantor hereby agrees that
a notation of such Note Guarantee shall be placed on each Note
authenticated and delivered by the Notes Trustee.
(b) This Indenture shall be executed on behalf of each
Subsidiary Guarantor, and an Officer of each Subsidiary Guarantor shall
sign the notation of the Note Guarantee on the Notes by manual or
facsimile signature. If an Officer whose signature is on this Indenture
or the notation of Note Guarantee no longer holds that office at the
time the Notes Trustee authenticates the Note on which the Note
Guarantee is endorsed, the Note Guarantee shall be valid nevertheless.
Each Subsidiary Guarantor hereby agrees that the Note Guarantee set
forth in Section 10.01 hereof shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of the
Note Guarantee.
(c) The delivery of any Note by the Notes Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Note Guarantee set forth in this Indenture on behalf of each Subsidiary
Guarantor.
SECTION 10.03. NOTE GUARANTEE UNCONDITIONAL, ETC.
Upon failure of payment when due of any Guaranteed Obligation for
whatever reason, each Subsidiary Guarantor will be obligated to pay the same
immediately. Each Subsidiary Guarantor hereby agrees that its obligations
hereunder shall be continuing, absolute and unconditional, irrespective of: (a)
the recovery of any judgment against the Company or any Subsidiary Guarantor;
(b) any extension, renewal, settlement, compromise, waiver or release in respect
of any obligation of the Company under this Indenture or any Note, by operation
of law or otherwise; (c) any modification or amendment of or supplement to this
Indenture or any Note; (d) any change in the corporate existence, structure or
ownership of the Company, or any insolvency, bankruptcy, reorganization or other
similar proceeding affecting the Company or its assets or any resulting release
or discharge of any obligation of the Company contained in this Indenture or any
Note; (e) the existence of any claim, set-off or other rights which any
Subsidiary Guarantor may have at any time against the Company, the Notes
Trustee, any Noteholder or any other Person, whether in connection herewith or
any unrelated transactions; provided, that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory counterclaim; any
invalidity or unenforceability relating to or against the Company for any reason
of this Indenture or any Note, or any provision of applicable law or regulation
purporting to prohibit the payment by the Company of the principal, premium, if
any, or interest on any Note or any other Guaranteed Obligation; or any other
act or omission to act or delay of any kind by the Company, the Notes Trustee,
any Noteholder or any other Person or any other circumstance whatsoever which
might, but for the provisions of this paragraph, constitute a legal or equitable
discharge of the Subsidiary Guarantors' obligations hereunder. Each Subsidiary
Guarantor hereby waives diligence, presentment, demand of payment, filing of
claims with a court in the event of insolvency or bankruptcy of the Company, any
right to require a proceeding
-82-
89
first against the Company, protest, notice and all demand whatsoever and
covenants that this Note Guarantee will not be discharged except by the complete
performance of the obligations contained in the Notes, this Indenture and in
this Article 10. Each Subsidiary Guarantor's obligations hereunder shall remain
in full force and effect until the Indenture shall have terminated and the
principal of and interest on the Notes and all other Guaranteed Obligations
shall have been paid in full. If at any time any payment of the principal of or
interest on any Note or any other payment in respect of any Guaranteed
Obligation is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of the Company or otherwise, each
Subsidiary Guarantor's obligations hereunder with respect to such payment shall
be reinstated as though such payment had been due but not made at such time, and
this Article 10, to the extent theretofore discharged, shall be reinstated in
full force and effect. Each Subsidiary Guarantor irrevocably waives any and all
rights to which it may be entitled, by operation of law or otherwise, upon
making any payment hereunder to be subrogated to the rights of the payee against
the Company with respect to such payment or otherwise to be reimbursed,
indemnified or exonerated by the Company in respect thereof.
SECTION 10.04. LIMITATION OF SUBSIDIARY GUARANTOR'S LIABILITY.
Each Subsidiary Guarantor and by its acceptance hereof each Noteholder
hereby confirms that it is the intention of all such parties that the guarantee
by such Subsidiary Guarantor pursuant to its Note Guarantee not constitute a
fraudulent transfer or conveyance for purposes of the Bankruptcy Law, Federal
and state fraudulent conveyance laws or other legal principles. To effectuate
the foregoing intention, the Noteholders and each Subsidiary Guarantor hereby
irrevocably agree that the obligations of such Subsidiary Guarantor under the
Note Guarantee shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Subsidiary
Guarantor and after giving effect to any collections from or payments made by or
on behalf of any other Subsidiary Guarantor in respect of the obligations of
such other Subsidiary Guarantor under its Note Guarantee or pursuant to Section
10.05 hereof, result in the obligations of such Subsidiary Guarantor under the
Note Guarantee not constituting such fraudulent transfer or conveyance under
federal or state law.
SECTION 10.05. CONTRIBUTION.
In order to provide for just and equitable contribution among the
Subsidiary Guarantors, the Subsidiary Guarantors agree, INTER SE, that in the
event any payment or distribution is made by any Subsidiary Guarantor (a
"Funding Subsidiary Guarantor") under the Note Guarantee, such Funding
Subsidiary Guarantor shall be entitled to a contribution from all other
Subsidiary Guarantors in a pro rata amount based on the Adjusted Net Assets of
each Subsidiary Guarantor (including the Funding Subsidiary Guarantor) for all
payments, damages and expenses incurred by that Funding Subsidiary Guarantor in
discharging the Company's obligations with respect to the Notes or any other
Subsidiary Guarantor's obligations with respect to the Note Guarantee.
-83-
90
SECTION 10.06. RELEASE.
Upon the sale or disposition of all of the Equity Interests of a
Subsidiary Guarantor to a Person which is not the Company or a Subsidiary of the
Company, which is otherwise in compliance with this Indenture, such Subsidiary
Guarantor shall be deemed released from all its obligations under the Indenture
without any further action required on the part of the Notes Trustee or any
Noteholder; PROVIDED, HOWEVER, that any such termination shall occur if and only
to the extent that all Obligations of each Subsidiary Guarantor under all of its
guarantees of, and under all of its pledges of assets or other security
interests which secure, Indebtedness of the Company and the other Subsidiary
Guarantors shall also terminate upon such release, sale or transfer; provided
further, that without limiting the foregoing, any proceeds received by the
Company or any Subsidiary of the Company from such transaction shall be applied
as provided in Section 4.10 and Section 3.09. The Notes Trustee shall execute an
appropriate instrument prepared by the Company evidencing such release upon
receipt of a request by the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section 10.06. Any Subsidiary
Guarantor not so released remains liable for the full amount of principal,
premium, if any, and interest on the Notes as provided in this Article 10.
SECTION 10.07. ADDITIONAL SUBSIDIARY GUARANTORS.
Any Person that was not a Subsidiary Guarantor on the date of this
Indenture may become a Subsidiary Guarantor by executing and delivering to the
Notes Trustee a supplemental indenture in form and substance satisfactory to the
Notes Trustee, which subjects such Person to the provisions (including, without
limitation, the representations and warranties in this Article 10 and Article
12) of this Indenture as a Subsidiary Guarantor. The Note Guarantee of each
Person described in this Section 10.07 shall apply to all Notes theretofore
executed and delivered, notwithstanding any failure of such Notes to contain a
notation of such Note Guarantee thereon.
SECTION 10.08. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON
CERTAIN TERMS.
(a) Nothing contained in this Indenture or in any of the Notes
shall prevent any consolidation or merger of a Subsidiary Guarantor
with or into the Company or another Subsidiary Guarantor that is a
Wholly-Owned Subsidiary of the Company or shall prevent any sale or
conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety to the Company or another Subsidiary
Guarantor that is a Wholly-Owned Subsidiary of the Company. Upon any
such consolidation, merger, sale or conveyance, the Note Guarantee
given by such Subsidiary Guarantor shall no longer have any force or
effect.
(b) Nothing contained in this Indenture or in any of the Notes
shall prevent any consolidation or merger of a Subsidiary Guarantor
with or into a Person or Persons other than the Company or another
Subsidiary Guarantor (whether or not affiliated with the Subsidiary
Guarantor), or successive consolidations or mergers in which a
Subsidiary
-84-
91
Guarantor or its successor or successors shall be a party or parties,
or shall prevent any sale or conveyance of the property of a Subsidiary
Guarantor as an entirety or substantially as an entirety, to a Person
other than the Company or another Subsidiary Guarantor (whether or not
affiliated with the Subsidiary Guarantor); PROVIDED, HOWEVER, that,
subject to Sections 10.06 and 10.08(a), (x) (i) immediately after such
transaction, and giving effect thereto, no Default or Event of Default
shall have occurred as a result of such transaction and be continuing,
or (ii) such transaction does not violate any covenants set forth in
this Indenture, and (y) (i) the respective transaction is treated as an
Asset Disposition for purposes of Section 4.10 and Section 3.09 hereof
or (ii) if the surviving Person is not the Subsidiary Guarantor, each
Subsidiary Guarantor hereby covenants and agrees that, upon any such
consolidation, merger, sale or conveyance, the Note Guarantee set forth
in this Article 10, and the due and punctual performance and observance
of all of the covenants and conditions of this Indenture to be
performed by such Subsidiary Guarantor, shall be expressly assumed (in
the event that the Subsidiary Guarantor is not the surviving Person in
the merger), by supplemental indenture satisfactory in form to the
Notes Trustee of the due and punctual performance of all of the
covenants and conditions of this Indenture to be performed by the
Subsidiary Guarantor, and such successor Person shall succeed to, and
be substituted for, the Subsidiary Guarantor with the same effect as if
it had been named herein as a Subsidiary Guarantor.
SECTION 10.09. SUCCESSORS AND ASSIGNS.
This Article 10 shall be binding upon each Subsidiary Guarantor and its
successors and assigns and shall inure to the benefit of the successors and
assigns of the Notes Trustee and the Noteholders and, in the event of any
transfer or assignment of rights by any Noteholder or the Notes Trustee, the
rights and privileges conferred upon that party in this Indenture and in the
Notes shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
SECTION 10.10. WAIVER OF STAY, EXTENSION OR USURY LAWS.
Each Subsidiary Guarantor 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 or extension law
or any usury law or other law that would prohibit or forgive each such
Subsidiary Guarantor from performing its Note Guarantee as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) each such Subsidiary Guarantor hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Notes Trustee,
but will suffer and permit the execution of every such power as though no such
law had been enacted.
-85-
92
ARTICLE 11: CREATION OF MORTGAGES.
SECTION 11.01. GRANT OF MORTGAGES.
(a) Each Subsidiary Guarantor shall grant to the Notes Trustee
a first Mortgage (subject to encumbrances of the type referred to in
paragraph (c) below) encumbering each of the Pledged Properties owned
by such Subsidiary Guarantor and which is identified on Schedule P
attached hereto in order to secure any and all obligations of such
Subsidiary Guarantor under the Subsidiary Guaranty made by such
Subsidiary Guarantor and in order to secure prompt performance by such
Subsidiary Guarantor of its covenants and duties under this Indenture.
Anything contained in this Indenture to the contrary notwithstanding,
and other than sales to buyers in the ordinary course of business, and
bulk sales permitted pursuant to this Indenture, no Subsidiary
Guarantor has the authority, express or implied, to dispose of any item
or portion of the Pledged Properties.
(b) Each Mortgage shall be recorded in the real property
records of the county in which the Pledged Property to which it
pertains is located.
(c) As promptly as possible following the recording of the
Mortgage, each Subsidiary Guarantor shall cause to be issued to the
Notes Trustee a Title Policy with respect thereto, which Title Policy
shall be in the amount identified on Schedule P attached hereto and
shall insure the Mortgage as being a valid first lien on the Pledged
Property subject only to (i) the printed exclusions of the Title
Policy, (ii) the lien of taxes and assessments not yet due and payable,
(iii) such covenants, conditions, and restrictions of record (other
than liens for payment of money) as existed at the time of the
acquisition thereof by the Subsidiary Guarantor executing the Mortgage
as evidenced by the owner's policy of title insurance obtained by the
Subsidiary Guarantor at the time of such acquisition, (iv) portions of
the Pledged Property dedicated to public use for roads, utility
easements, and open areas in connection with the plotting and
subdivision thereof, and (v) such other covenants, conditions,
easements, and restrictions of record thereafter executed by, or
consented to by, the Subsidiary Guarantor executing the Mortgage which
do not affect adversely the marketability of title to, or the value of,
such Pledged Property.
SECTION 11.02. DELIVERY OF MORTGAGES AND TITLE POLICIES.
Each Subsidiary Guarantor shall cause each Mortgage to be filed for
record in the real property records of the county in which the Pledged Property
is located and, as soon as available following recording, cause to be delivered
promptly to the Notes Trustee each original recorded Mortgage along with the
original of each Title Policy pertaining thereto.
-86-
93
SECTION 11.03. PARTIAL RELEASES OF PLEDGED PROPERTIES.
(a) Each Subsidiary Guarantor shall have the right to enter
into contracts of sale for Residential Lots constituting portions of
the Pledged Properties upon the following terms and conditions:
(i) there shall not have occurred and be
continuing at the time of entry into such
contract of sale any Event of Default for
which the Notes Trustee has given notice to
the Noteholders as provided in Section 7.05
above;
(ii) the contract of sale for the Residential Lot
shall be entered into at arms-length with a
bona fide purchaser (including any employee
of the Company or any Subsidiary Guarantor
who purchases a Residential Lot pursuant to
the Company's employee purchase discount
policy, up to one (1) such residential
purchase per calendar year (an "Employee
Purchase")) in the ordinary course of
business which is not an affiliate of the
Company or any Subsidiary Guarantor;
(iii) the Residential Lot has been lawfully
subdivided and may be legally conveyed using
the legal description set forth in the
contract of sale;
(iv) the sale price of the Residential Lot shall
be acceptable to the Subsidiary Guarantor
acting in good faith and shall represent, in
the good faith opinion of the Subsidiary
Guarantor, the fair market value thereof;
(v) the contract of sale shall provide for
offset against, or deduction from, the sales
price only such closing costs, commissions,
and fees as are usual and customary in
transactions involving the sales of
undeveloped Residential Lots in the
jurisdiction in which the Residential Lot is
located; provided, however, that in the case
of an Employee Purchase, the contract of
sale shall provide for an offset against, or
deduction from the sale price of not more
than fifteen (15) percent; and
(vi) the contract of sale shall provide that the
entire net proceeds of sale shall be payable
at the time of conveyance of the Residential
Lot to the purchaser thereunder, with any
portion thereof not being paid in cash being
secured by a first mortgage or deed of trust
encumbering the Residential Lot or such
other collateral which in the good faith
judgment of the Subsidiary Guarantor selling
the
-87-
94
Residential Lot has a fair market value
reasonably equivalent to the fair market
value of the Residential Lot being sold.
During the continuance of any Event of Default as to which the Notes
Trustee has given notice to the Noteholders as provided in Section 7.05 above,
no Subsidiary Guarantor shall have the right to enter into contracts of sale for
Residential Lots.
(b) The Notes Trustee shall release, or cause to be released,
the lien of the Mortgage encumbering the Residential Lot in connection
with the conveyance of the Residential Lot pursuant to the contract of
sale upon receipt by the Notes Trustee of a written notice from an
Escrow Agent (defined below) stating that each of the following
conditions has been satisfied:
(i) an officer or partner of the Subsidiary
Guarantor has delivered a certificate to the
Escrow Agent certifying that each of the
conditions set forth in Section 11.03(a) was
true and correct as of the date of entry
into the contract of sale for the
Residential Lot;
(ii) the Subsidiary Guarantor has delivered to
the Escrow Agent a preliminary settlement
statement showing the contract sales price
for the Residential Lot and all closing
costs and prorations attributable to, or
charged against, the Subsidiary Guarantor,
the amount of any purchase money mortgage
taken back by the Subsidiary Guarantor or
any affiliate of the Company or the
Subsidiary Guarantor, and the net proceeds
payable to the Subsidiary Guarantor in cash
as a result of the sale;
(iii) the Subsidiary Guarantor has delivered to
the Escrow Agent a legal description of the
Residential Lot being sold.
The Notes Trustee may rely conclusively without inquiry or
investigation on any notice from the Escrow Agent received by it
pursuant to this paragraph (b).
(c) In order to expedite such partial release of Residential
Lots, the Notes Trustee, from time to time, upon written request by a
Subsidiary Guarantor, and no later than two Business Days following the
Notes Trustee's receipt of the related notice from the Escrow Agent
received by it pursuant to paragraph (b), above, shall cause multiple
partial releases or deeds of reconveyance for Residential Lots (to be
provided by the Subsidiary Guarantor with such request) to be deposited
in escrow with such title company, financial institution, or other
escrow agent (an "Escrow Agent") designated by the Subsidiary
Guarantor. The Notes Trustee shall deliver such instruments of release
or reconveyance, executed in blank, to the Escrow Agent with a covering
letter in form identical to EXHIBIT E attached hereto (the "Escrow
Letter"), with bracketed language therein being replaced by the
appropriate information. If, in connection with its appointment as
Escrow Agent,
-88-
95
any Escrow Agent requires that it be indemnified with respect to its
activities in connection with any Residential Lot releases pursuant to
this paragraph (c), then the Company and/or the appropriate Subsidiary
Guarantor shall indemnify such Escrow Agent to the extent usual and
customary in similar transactions. The Notes Trustee shall have no
obligation to determine, inquire, or investigate as to whether the
Escrow Agent complies with the terms of the Escrow Letter. Upon the
request of any Escrow Agent, the Trustee may agree to modify the terms
of the Escrow Letter, PROVIDED, HOWEVER, that the Trustee shall have
received an opinion of counsel acceptable to the Trustee opining that
the proposed modifications would not materially adversely affect the
Noteholders.
(d) Provided there then exists no Event of Default for which
the Notes Trustee has given notice to the Noteholders as provided in
Section 7.05, each Subsidiary Guarantor shall have the right to sell
portions of the Pledged Properties owned by it in bulk (I.E., multiple
lots) or as unsubdivided acreage at a price not less than its fair
market value as evidenced by a certificate of an officer or partner of
the Subsidiary Guarantor.
(e) In the event of such a sale in bulk, the Notes Trustee
shall release, or cause to be released, the lien of the Mortgage
encumbering such land upon receipt by the Notes Trustee of a written
notice from the Escrow Agent charged with closing the sale, stating
that each of the following conditions has been satisfied:
(i) The Escrow Agent has received a copy of the
executed purchase and sale agreement.
(ii) The Escrow Agent has received the
certification referenced in Section 11.03
(d).
(iii) The sales price set forth in the purchase
and sale agreement shall be not less than
the fair market value certified as provided
in Section 11.03(d).
(iv) The Escrow Agent has been provided with a
legal description of the property being
sold.
(v) The Escrow Agent has been provided with a
preliminary closing statement.
Upon receipt of the foregoing notice from the Escrow Agent, upon which
the Notes Trustee may rely conclusively without inquiry or investigation, the
Notes Trustee, within ten days, shall cause to be deposited in escrow with the
Escrow Agent, a partial release pertaining to such property with instructions
that it shall be delivered and recorded only at such time as the entire net cash
proceeds of sale are payable to or for the benefit of the seller thereof. The
Notes Trustee shall deliver such partial release (which may be executed in
blank) to the Escrow Agent with a covering letter in the form identical to
EXHIBIT F attached hereto (the "Alternative Escrow
-89-
96
Letter"), with bracketed language therein being replaced by the appropriate
information. If, in connection with its appointment as Escrow Agent, any Escrow
Agent requires that it be indemnified with respect to its activities in
connection with any releases pursuant to this paragraph (e), then the Company
and/or the appropriate Subsidiary Guarantor shall indemnify such Escrow Agent to
the extent usual and customary in similar transactions. The Notes Trustee shall
have no obligation to determine, inquire, or investigate as to whether the
Escrow Agent complies with the terms of the Alternative Escrow Letter. Upon the
request of any Escrow Agent, the Trustee may agree to modify the terms of the
Alternative Escrow Letter, PROVIDED, HOWEVER, that the Notes Trustee shall have
received an opinion of counsel acceptable to the Notes Trustee opining that the
proposed modifications would not materially adversely effect the Noteholders.
SECTION 11.04. DELIVERY OF ADDITIONAL DOCUMENTATION REQUIRED.
At any time upon the request of the Notes Trustee, each Subsidiary
Guarantor shall execute and deliver to the Notes Trustee all reports, notices,
schedules of accounts, letters of authority, and all other documents of any kind
whatsoever as the Notes Trustee may reasonably request, in form satisfactory to
the Notes Trustee, to perfect and continue perfected the Mortgages and in order
to fully consummate all of the transactions contemplated hereby.
SECTION 11.05. RIGHT TO INSPECT.
The Notes Trustee (through any of its officers, employees or agents)
shall have the right, from time to time hereafter to inspect any Subsidiary
Guarantor's books and to check, test, and appraise the Pledged Properties in
order to verify any Subsidiary Guarantor's financial condition or the amount,
quality, value, condition of, or any other matter relating to the Pledged
Properties.
SECTION 11.06. COMPLIANCE WITH THE TIA.
Pursuant to Section 314(b) of the TIA, in connection with the creation
of the Mortgages, the Company and each Subsidiary Guarantor as obligor of the
Notes shall furnish to the Notes Trustee:
(a) Promptly following the execution and delivery of this
Indenture, an opinion of counsel for the Company and each Subsidiary
Guarantor as obligor of the Notes, opining that the Indenture has been
properly recorded and filed so as to make effective the lien intended
to be created thereby or stating that in the opinion of such counsel,
no such action is necessary to make such lien effective; and
(b) At least annually following the execution and delivery of
this Indenture, but only so long as any Pledged Properties remain
subject to this Article 11, an opinion of counsel for the Company and
each Subsidiary Guarantor as obligor of the Notes, stating that either
(i) in the opinion of such counsel, such action has been taken with
respect to the recording, filing, re-recording and refiling of this
Indenture as is necessary to
-90-
97
maintain the lien of this Indenture and reciting the details of such
action, or (ii) in the opinion of such counsel, no such action is
necessary to maintain such lien.
ARTICLE 12: MISCELLANEOUS
SECTION 12.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control. Until such time as this Indenture becomes
qualified under the TIA, the Company, the Subsidiary Guarantors and the Notes
Trustee shall be deemed subject to and governed by the TIA as if the Indenture
were so qualified on the date hereof.
SECTION 12.02. NOTICES.
(a) Any notice or communication by the Company, any Subsidiary
Guarantor or the Notes Trustee to the other is duly given if in writing
and delivered in person or mailed by first class mail (registered or
certified, return receipt requested), confirmed facsimile transmission
or overnight air courier guaranteeing next day delivery, to the other's
address:
If to the Company or any of the Subsidiary Guarantors:
Bluegreen Corporation
0000 Xxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Facsimile No.: (000) 000-0000
If to the Notes Trustee:
SunTrust Bank, Central Florida, National Association
000 Xxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Corporate Trust Administration
Facsimile No.: (000) 000-0000
(b) The Company or the Notes Trustee, by notice to the other,
may designate additional or different addresses for subsequent notices
or communications.
(c) All notices and communications (other than those sent to
Noteholders) shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when
-91-
98
receipt acknowledged, if by facsimile transmission; and the next
Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery.
(d) Any notice or communication to a Noteholder shall be
mailed by first class mail, postage prepaid, to its address shown on
the register kept by the Registrar. Any notice or communication shall
also be so mailed to any Person described in TIA Section 313(c), to the
extent required by the TIA. Failure to mail a notice or communication
to a Noteholder or any defect in it shall not affect its sufficiency
with respect to other Noteholders.
(e) If a notice or communication is mailed to any Person in
the manner provided above within the time prescribed, it is duly given,
whether or not the addressee receives it.
(f) If the Company mails a notice or communication to
Noteholders, it shall mail a copy to the Notes Trustee and each Agent
at the same time.
SECTION 12.03. COMMUNICATION BY NOTEHOLDERS WITH OTHER
NOTEHOLDERS.
Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Company, the Subsidiary Guarantors, the Notes Trustee, the Registrar and anyone
else shall have the protection of TIA Section 312(c).
SECTION 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company and/or any of the
Subsidiary Guarantors to the Notes Trustee to take any action under this
Indenture, the Company and/or any of the Subsidiary Guarantors, as the case may
be, shall furnish to the Notes Trustee:
(a) an Officer's Certificate in form and substance reasonably
satisfactory to the Notes Trustee (which shall include the statements
set forth in Section 12.05 hereof) stating that, in the opinion of the
signers, all conditions precedent and covenants, if any, provided for
in this Indenture relating to the proposed action have been satisfied
(except with regard to an authentication order pursuant to Section
2.02(c) hereof, which shall require a certificate of two Officers); and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Notes Trustee (which shall include the statements
set forth in Section 12.05 hereof) stating that, in the opinion of such
counsel, all such conditions precedent and covenants have been
satisfied.
-92-
99
SECTION 12.05. 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 a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e), shall comply with the definition of the term "Officers'
Certificate" and shall include:
(a) a statement that the person making such certificate or
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, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been satisfied; and
(d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been satisfied.
SECTION 12.06. RULES BY TRUSTEE AND AGENTS.
The Notes Trustee may make reasonable rules for action by or at a
meeting of Noteholders. The Registrar or Paying Agent may make reasonable rules
and set reasonable requirements for its functions.
SECTION 12.07. LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in New York City, Orlando, Florida, or at a place of payment are
authorized or obligated by law, regulation or executive order to remain closed.
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.
SECTION 12.08. NO RECOURSE AGAINST OTHERS.
No past, present or future director, officer, employee, agent, manager,
shareholder or partner of the Company or any Subsidiary or any of their
predecessors, as such, shall have any liability for any Obligations of the
Company or any Subsidiary under the Note, or this Indenture, the Note Guarantee,
the Mortgages or for any claim based on, in respect of, or by reason of such
Obligations or their creation. Each Noteholder by accepting a Note waives and
releases all such liability. This waiver and release are part of the
consideration for issuance of the Notes and the Note Guaranteed the grant of the
Mortgages. Such waiver may not be effective to waive
-93-
100
liabilities under the Federal securities laws and it is the view of the
Commission that such a waiver is against public policy.
SECTION 12.09. DUPLICATE ORIGINALS.
The parties may sign any number of copies of this Indenture. One signed
copy is enough to prove this Indenture.
SECTION 12.10. GOVERNING LAW.
This Indenture and the Notes shall be governed by, and construed in
accordance with, the internal, substantive laws of the State of New York,
without giving effect to applicable principles of conflicts of law to the extent
that the application of the laws of another jurisdiction would be required
thereby.
SECTION 12.11. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Subsidiary Guarantors, the Company or their
respective Subsidiaries. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture.
SECTION 12.12. SUCCESSORS.
All agreements of the Company and the Subsidiary Guarantors in this
Indenture and the Notes shall bind its successors. All agreements of the Notes
Trustee in this Indenture shall bind its successor.
SECTION 12.13. 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.
SECTION 12.14. COUNTERPART ORIGINALS.
This Indenture may be executed in any number of counterparts, each of
which so executed shall be an original, but all of them together represent the
same agreement.
SECTION 12.15. 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 of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
-94-
101
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the date first written above.
SIGNATURES
BLUEGREEN CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
BLUEGREEN RESORTS MANAGEMENT, INC.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN RESORTS, INC.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN HOLDING CORPORATION (TEXAS)
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
PROPERTIES OF THE SOUTHWEST ONE, INC.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President
PROPERTIES OF THE SOUTHWEST, L.P.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President of Its General
Partner, PROPERTIES OF THE
SOUTHWEST ONE, INC.
102
BLUEGREEN ASSET MANAGEMENT CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN CAROLINA LAND, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN CORPORATION OF MONTANA
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN CORPORATION OF TENNESSEE
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN CORPORATION OF THE ROCKIES
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
VIRGINIA LAND & FOREST CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
103
BLUEGREEN COMMUNITIES, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BLUEGREEN RESORTS INTERNATIONAL,
INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
CAROLINA NATIONAL GOLF CLUB, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
LEISURE CAPITAL CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
PROPERTIES OF THE WEST, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
BG/RDI ACQUISITION CORP.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
104
RDI GROUP, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
DELLONA ENTERPRISES, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
RESORT DEVELOPMENT INTERNATIONAL,
INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
RDI RESORT SERVICES CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
RDI RESOURCES, INC.
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
000
XXXXXXXX XXXX, XXXXXXX XXXXXXX,
NATIONAL ASSOCIATION
By: /s/ XXXXXXXX X. XXX
----------------------------------
Name: Xxxxxxxx X. Xxx
Title: Sr. Vice President
106
EXHIBIT A
FORM OF INITIAL NOTE
THIS NOTE OR ITS PREDECESSORS HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
ACCORDINGLY, NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED,
SOLD OR PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, UNITED STATES PERSONS OR A
BENEFICIAL INTEREST HEREIN EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IF
IT ACQUIRED THIS NOTE FROM THE INITIAL PURCHASERS, IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT), OR, IF IT ACQUIRED THIS NOTE OTHER THAN FROM THE INITIAL
PURCHASERS, (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) or (7) OF
REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (C) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS NOTE
FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS NOTE
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 144A UNDER
REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT,
WITHIN THE TIME PERIOD REFERRED TO IN RULE 144(k) UNDER THE SECURITIES
ACT AS IN EFFECT WITH RESPECT TO SUCH TRANSFER, RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO BLUEGREEN CORPORATION OR ANY
SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE NOTES TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF
WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), AND AN OPINION OF
COUNSEL ACCEPTABLE TO BLUEGREEN CORPORATION THAT SUCH TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES
ACT TO PERSONS OTHER THAN UNITED STATES PERSONS ("FOREIGN PURCHASERS"),
(E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT
WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS
A-1
107
LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO
THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE NOTES TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE
FOREGOING RESTRICTIONS.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY OR A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. 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.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
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 HEREON 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.
CUSIP No: ____________
(Front of Note)
No. ___ $_______________
BLUEGREEN CORPORATION
10 1/2% Senior Secured Notes due 2008, Series A
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
A-2
108
BLUEGREEN CORPORATION, a Massachusetts corporation promises to pay to CEDE &
Co., or its registered assigns, the principal sum of $__________________ on
April 1, 2008. Interest Payment Dates: April 1 and October 1, commencing October
1, 1998. Record Dates: March 15 and September 15 (whether or not a Business
Day). Additional provisions of this Note are set forth on the other side of this
Note.
Dated:
BLUEGREEN CORPORATION
By: ____________________________
Name:
Title:
By: ____________________________
Name:
Title:
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes referred
to in the within-mentioned Indenture
SUNTRUST BANK, CENTRAL FLORIDA, NATIONAL ASSOCIATION
By:_________________________________
Authorized Signatory
A-3
109
(Reverse of Note)
10 1/2% SENIOR SECURED NOTE DUE 2008, Series A
Capitalized terms used herein have the meanings assigned to them in the
Indenture (as defined below) unless otherwise indicated.
1. INTEREST. Bluegreen Corporation, a Massachusetts
corporation (the "Company"), promises to pay interest on the principal amount of
this Note at the rate and in the manner specified below. The Company shall pay,
in cash, interest on the principal amount of this Note at the rate per annum of
10 1/2%. The Company will pay interest semiannually in arrears on April 1 and
October 1 of each year (each an "Interest Payment Date"), commencing October 1,
1998, or if any such day is not a Business Day on the next succeeding Business
Day. Interest will be computed on the basis of a 360-day year consisting of
twelve 30-day months. Interest shall accrue from the most recent Interest
Payment Date to which interest has been paid or, if no interest has been paid,
from the date of the original issuance of the Notes. To the extent lawful, the
Company shall pay interest on overdue principal at the rate of 2% per annum in
excess of the then applicable interest rate on the Notes; it shall pay interest
on overdue installments of interest (without regard to any applicable grace
periods) at the same rate to the extent lawful. The rate of interest payable on
this Note shall be subject to the assessment of additional interest (the
"Additional Interest") as follows:
(i) if the Exchange Offer Registration Statement (as defined
below) or Shelf Registration Statement (as defined below) is
not filed within 75 days following the Issue Date or, in the
case of the Shelf Registration Statement, 75 days following a
Shelf Request, (as defined in the Registration Rights
Agreement) Additional Interest shall accrue on the Notes over
and above the stated interest at a rate of 0.50% per annum for
the first 30 days commencing on the 75th day after the Issue
Date or the Shelf Request, respectively, such Additional
Interest rate increasing by an additional 0.50% per annum at
the beginning of each subsequent 30-day period;
(ii) if the Exchange Offer Registration Statement or Shelf
Registration Statement is not declared effective within, in
the case of the Exchange Offer Registration Statement, 135
days following the Issue Date or, in the case of the Shelf
Registration Statement, 135 days following a Shelf Request,
Additional Interest shall accrue on the Notes over and above
the stated interest at a rate of 0.50% per annum for the first
30 days commencing on the 135th day after the Issue Date or
the Shelf Request, respectively, such Additional Interest rate
increasing by an additional 0.50% per annum at the beginning
of each subsequent 30-day period; or
(iii) if (A) the Company and the Subsidiary Guarantors have
not exchanged all Notes validly tendered in accordance with
the terms of the Exchange Offer on or prior to 165 days after
the Issue Date or (B) the Exchange Offer Registration
A-4
110
Statement ceases to be effective at any time prior to the time
that the Exchange Offer is consummated or (C) if applicable,
the Shelf Registration Statement has been declared effective
and such Shelf Registration Statement ceases to be effective
at any time prior to the first anniversary of the Issue Date
(unless all the Notes have been sold thereunder), then
Additional Interest shall accrue on the Notes over and above
the stated interest at a rate of 0.50% per annum for the first
30 days commencing on (x) the 165th day after the Issue Date
with respect to the Notes validly tendered and not exchanged
by the Company, in the case of (A) above, or (y) the day the
Exchange Offer Registration Statement ceases to be effective
or usable for its intended purpose in the case of (B) above,
or (z) the day such Shelf Registration Statement ceases to be
effective in the case of (C) above, such Additional Interest
rate increasing by an additional 0.50% per annum at the
beginning of each subsequent 30-day period; PROVIDED, HOWEVER,
that the Additional Interest rate on the Notes under clauses
(i), (ii) and (iii) above may not exceed in the aggregate 1.5%
per annum; and provided further, that (1) upon the filing of
the Exchange Offer Registration Statement or Notes Shelf
Registration Statement (in the case of clause (i) above), (2)
upon the effectiveness of the Exchange Offer Registration
Statement or Shelf Registration Statement (in the case of (ii)
above), or (3) upon the exchange of Exchange Notes for all
Notes tendered (in the case of clause (iii)(A) above), or upon
the effectiveness of the Exchange Offer Registration Statement
which had ceased to remain effective (in the case of clause
(iii)(B) above), or upon the effectiveness of the Shelf
Registration Statement which had ceased to remain effective
(in the case of clause (iii)(C) above), Additional Interest on
the Notes as a result of such clause (or the relevant
subclause thereof), as the case may be, shall cease to accrue.
The Company and each of the Subsidiaries will use their best efforts
and will assist counsel for the Initial Purchasers, to obtain title insurance
policies, in each case in form and content reasonably satisfactory to the
Initial Purchasers, for each of the Pledged Properties as soon as reasonably
practicable after the Closing Date. It is understood that such title insurance
policies will reflect customary exceptions which are acceptable to mortgage
lenders generally and that any encumbrance on mortgaged property which existed
at the time the Company or one of its Subsidiaries acquired the property shall
be acceptable. Each policy obtained shall be in an amount not less than the cost
basis of Th applicable property as of January 25, 1998 (minus any land which has
been sold since that date). The Company and each of the Subsidiaries agree that
the Initial Purchasers and any subsequent holders of the Notes will suffer
damages if such title insurance policies are not obtained for all of the Pledged
Properties by the 60th day following the Closing Date, and further agree that it
would not be feasible to ascertain the extent of such damages with precision.
Accordingly, the Company and the Subsidiaries agree to pay, as liquidated
damages and as the sole and exclusive remedy therefor, additional interest on
the Notes ("Title Insurance Additional Interest") at the rate of 0.50% per annum
commencing on the 61st day after the Closing Date. The Title Insurance
Additional Interest rate on the Notes shall be in addition to any Additional
Interest that may be accruing pursuant to the Registration Rights Agreement.
Title Insurance Additional Interest on the Notes will cease to accrue upon the
earlier to occur of (a) date on which a title insurance policy, in form and
content reasonably satisfactory
A-5
111
to the Initial Purchasers, for the last of the Pledged Properties is delivered
to and received by the Initial Purchasers or (b) the date on which the last of
the Pledged Properties has been sold.
The Company shall pay any Title Insurance Additional Interest due on
the Notes by depositing with the Paying Agent (which shall not be the Company
for these purposes) for the Notes, in trust, for the benefit of the holders
thereof, prior to 11:00 A.M. on the next Interest Payment Date specified by the
Indenture, sums sufficient to pay the Title Insurance Additional Interest then
due. Any amounts of Title Insurance Additional Interest due will be payable in
cash, semi-annually on each Interest Payment Date to the record holders entitled
to receive the interest payment to be made on such date, commencing with the
first such date occurring after any such Title Insurance Additional Interest
commences to accrue. The amount of Title Insurance Additional Interest will be
determined by multiplying the applicable Title Insurance Additional Interest
rate by the principal amount of the affected Notes of such holders, multiplied
by a fraction, the numerator of which is the number of days such Title Insurance
Additional Interest rate was applicable during such period (determined on the
basis of a 360-day year comprised of twelve 30-day months and, in the case of a
partial month, the actual number of days elapsed), and the denominator of which
is 360.
"Exchange Offer" shall mean the exchange offer by the Company of
Initial Notes for Exchange Notes pursuant to Section 2(a) of the Registration
Rights Agreement.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form) and all amendments and supplements to such registration statement, in each
case including the Offering Memorandum or prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
"Record Date" shall have the meaning provided on the front of this
Note.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Subsidiary Guarantors pursuant to the
provisions of the Registration Rights Agreement which covers all of the Initial
Notes on an appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the Commission, and all amendments and
supplements to such registration statement, including post-effective amendments,
in each case including the Offering Memorandum contained therein, all exhibits
thereto and all material incorporated by reference therein.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the Record Date immediately preceding the Interest
Payment Date, even if such Notes are canceled after such Record Date and on or
before such Interest Payment Date. Noteholders must surrender Notes to a Paying
Agent to collect principal payments. The Company shall pay principal, premium,
if any, and interest in money of the United States that at the time of payment
is legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal, premium, if any, and interest by its
check payable in such U.S.
A-6
112
Legal Tender. The Company may deliver any such interest payment to the Paying
Agent or to a Noteholder at the Noteholder's registered address.
3. PAYING AGENT AND REGISTRAR. Initially, the Notes Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-registrar without prior notice to any Noteholder. The Company or any
Subsidiary Guarantor may act in any such capacity, except that none of the
Company, its Subsidiaries or their Affiliates shall act (i) as Paying Agent in
connection with any redemption, offer to purchase, discharge or defeasance, as
otherwise specified in the Indenture, and (ii) as Paying Agent or Registrar if a
Default or Event of Default has occurred and is continuing.
4. INDENTURE. The Company issued the Notes under an Indenture, dated as
of April 1, 1998 (the "Indenture"), between the Company and SunTrust Bank,
Central Florida, National Association, as Trustee (the "Trustee"). The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the TIA as in effect on the date the Indenture is
qualified, except as otherwise provided in the Indenture. The Notes are subject
to all such terms, and Noteholders are referred to the Indenture and the TIA for
a statement of such terms. The terms of the Indenture shall govern any
inconsistencies between the Indenture and the Notes. The Notes are senior
secured Obligations of the Company limited to $110,000,000 in aggregate
principal amount.
5.(a) OPTIONAL REDEMPTION. Except as indicated in the next succeeding
paragraph, the Notes are not redeemable at the Company's option prior to April
1, 2003. Thereafter, the Notes will be redeemable, at the option of the Company,
in whole or in part, at the redemption prices (expressed as percentages of the
principal amount of the Notes) set forth below, plus accrued interest to the
redemption date:
PERIOD REDEMPTION PRICE
2003.......................................................105.25%
2004.......................................................103.50%
2005.......................................................101.75%
2006 and thereafter........................................100.00%
(b) OPTIONAL REDEMPTION UPON EQUITY OFFERINGS. At any time, or
from time to time, on or prior to April 1, 2001, the Company may, at
its option, redeem up to 35% of the original aggregate principal amount
of the Notes, with the Net Cash Proceeds of one or more Equity
Offerings by the Company, at a redemption price equal to 110.5% of the
principal amount thereof, plus accrued and unpaid interest thereon, if
any, to the date of redemption; PROVIDED, HOWEVER, that after any such
redemption, the aggregate principal amount of the Notes outstanding
must equal at least $65 million. In order to effect the foregoing
redemption with the proceeds of any Equity Offering, the Company shall
make such redemption not more than 90 days after the consummation of
any such Equity Offering.
A-7
113
6. MANDATORY REDEMPTION. Except as set forth in Section 7, the Notes
are not subject to mandatory redemption or sinking fund payments.
7. REPURCHASE AT OPTION OF NOTEHOLDER. (a) If there is a Change of
Control, each Holder of Notes will have the right to require the Company to
repurchase all or any part of such Holder's Notes at a repurchase price equal to
101% of the principal amount thereof, plus accrued and unpaid interest, if any,
to the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant Interest Payment
Date). Within 30 days following any Change of Control, the Company will mail a
notice to each Noteholder stating (i) that a Change of Control has occurred and
that such Noteholder has the right to require the Company to repurchase all or
any part of such Noteholder's Notes at a repurchase price in cash equal to 101%
of the principal amount thereof plus accrued and unpaid interest, if any, to the
date of repurchase (subject to the right of Holders of record on the relevant
Record Date to receive interest due on the relevant Interest Payment Date); (ii)
the repurchase date (which will be no earlier then 30 days nor later than 60
days from the date such notice is mailed); and (iii) the procedures, determined
by the Company consistent with the Indenture, that a Noteholder must follow in
order to have its Notes repurchased. Noteholders that are subject to an offer to
repurchase may elect to have such Notes repurchased by completing the form
entitled "Option of Noteholder to Elect Purchase" appearing below.
(b) If the Company or a Restricted Subsidiary consummates any
Asset Disposition, and when the aggregate amount of Net Available Cash
from such an Asset Disposition exceeds $10.0 million, the Company shall
be required to offer to purchase the maximum principal amount of Notes,
that is in an integral multiple of $1,000, that may be purchased out of
the Net Available Cash at 100% of the principal amount thereof, plus
accrued and unpaid interest, if any, to the date fixed for the closing
of such offer in accordance with the procedures set forth in the
Indenture. If the aggregate principal amount of Notes surrendered by
Holders thereof exceeds the amount of Net Available Cash, the Notes to
be redeemed shall be selected on a pro rata basis. Noteholders that are
the subject of an offer to purchase will receive an Asset Disposition
Offer from the Company prior to any related purchase date and may elect
to have such Notes purchased by completing the form entitled "Option of
Noteholder to Elect Purchase" appearing below.
8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least
45 (unless a shorter period is acceptable to the Notes Trustee) before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address. Notes may be redeemed in part but only in whole multiples of $1,000,
unless all of the Notes held by a Noteholder are to be redeemed. On and after
the redemption date, interest ceases to accrue on Notes or portions of them
called for redemption.
9. REGISTRATION RIGHTS. Pursuant to the Registration Rights Agreement,
and subject to certain terms and conditions stated therein, the Company will be
obligated to consummate an Exchange Offer pursuant to which the Holders of the
Initial Notes shall have the right to
A-8
114
exchange this Note for Exchange Notes, which have been registered under the
Securities Act, in like principal amount and having terms identical in all
material respect to the Initial Note.
10. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Notes Trustee may require a Noteholder
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. The
Registrar need not exchange or register the transfer of any Note or portion of a
Note selected for redemption. Also, it need not exchange or register the
transfer of any Notes during a period beginning at the opening of business on a
Business Day 15 days before the day of any selection of Notes to be redeemed and
ending at the close of business on the day of selection or during the period
between a Record Date and the corresponding Interest Payment Date.
11. PERSONS DEEMED OWNERS. Prior to due presentment to the Notes
Trustee for registration of the transfer of this Note, the Notes Trustee, any
Agent and the Company may deem and treat the Person in whose name this Note is
registered as its absolute owner for the purpose of receiving payment of
principal of, premium, if any, and interest on this Note and for all other
purposes whatsoever, whether or not this Note is overdue, and neither the Notes
Trustee, any Agent nor the Company shall be affected by notice to the contrary.
The registered Noteholder shall be treated as its owner for all purposes.
12. AMENDMENTS AND WAIVERS. Subject to certain exceptions provided in
the Indenture, the Indenture or the Notes may be amended with the consent of the
Holders of a majority in principal amount of the then outstanding Notes, and any
existing Default or Event of Default (except a payment default) may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes. Without the consent of any Noteholder the Indenture or the
Notes may be amended to, among other things, cure any ambiguity, defect or
inconsistency, to comply with the requirements of the Commission in order to
effect or maintain qualification of the Indenture under the TIA or to make any
change that does not adversely affect the rights of any Noteholder.
13. DEFAULTS AND REMEDIES. If an Event of Default occurs and is
continuing, the Notes Trustee or the Holders of at least 25% in principal amount
of the then outstanding Notes may declare the unpaid principal of, and any
accrued and unpaid interest on, all the Notes to be due and payable immediately;
provided, that in the case of an Event of Default arising from certain events of
bankruptcy or insolvency with respect to the Company or any Subsidiary
Guarantor, all outstanding Notes shall become due and payable immediately
without further action or notice. Noteholders may not enforce the Indenture or
the Notes except as provided in the Indenture. The Notes Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Notes.
Subject to certain limitations, Holders of a majority in principal amount of the
then outstanding Notes may direct the Notes Trustee in its exercise of any trust
or power. The Notes Trustee may withhold from Noteholders notice of any
continuing default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interests. The Company must
furnish an annual compliance certificate to the Notes Trustee.
X-0
000
00. NOTES TRUSTEE DEALINGS WITH THE COMPANY. The Notes Trustee under
the Indenture, in its individual or any other capacity may make loans to, accept
deposits from, and perform services for the Company, the Subsidiary Guarantors
or any Affiliate of the Company or the Subsidiary Guarantors, and may otherwise
deal with the Company, the Subsidiary Guarantors and their respective Affiliates
as if it were not Notes Trustee.
15. RESTRICTIVE COVENANTS. The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of its Capital
Stock or certain Indebtedness, enter into transactions with Affiliates, create
dividend or other payment restrictions affecting Subsidiaries, merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions provided for in the Indenture. The Company must
annually report to the Notes Trustee on compliance with such limitations.
16. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Notes Trustee or an authenticating agent.
17. NOTE GUARANTEE. Each Subsidiary Guarantor has jointly and severally
irrevocably and unconditionally guaranteed the payment of principal, premium, if
any, and interest (including interest on overdue principal and overdue interest,
if lawful) on the Notes; PROVIDED, HOWEVER, each Subsidiary Guarantor that makes
a payment or distribution under a Note Guarantee shall be entitled to a
contribution from each other Subsidiary Guarantor in a pro rata amount based on
the Adjusted Net Assets of each Subsidiary Guarantor.
18. DEFEASANCE. Subject to certain conditions provided for in the
Indenture, the Company at any time may terminate some or all of its obligations
under the Notes and the Indenture if the Company deposits with the Notes Trustee
money or U.S. Government Obligations for the payment of principal, premium (if
any) and interest on the Notes to redemption or maturity, as the case may be.
19. GOVERNING LAW. The laws of the State of New York shall govern this
Note and the Indenture, without regard to the principles of conflict of laws of
such State.
20. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Noteholder 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 U/G/M/A
(= Uniform Gifts to Minors Act).
21. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Note Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and has directed the Notes Trustee to
use CUSIP numbers in notices of redemption as a convenience to Noteholders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
A-10
116
The Company will furnish to any Noteholder upon written request and
without charge a copy of the Indenture. Request may be made to:
Bluegreen Corporation
0000 Xxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Chief Financial Officer
FORM OF NOTATION ON SECURITY
RELATING TO NOTE GUARANTEE
NOTE GUARANTEE
The Subsidiary Guarantors (as defined in the Indenture referred to in
the Note upon which this notation is endorsed and each hereinafter referred to
as a "Subsidiary Guarantor," which term includes any successor person under the
Indenture) (i) have jointly and severally irrevocably and unconditionally
guaranteed as a primary obligor and not a surety, (such guarantee by each
Subsidiary Guarantor being referred to herein as the "Note Guarantee") (a) the
due and punctual payment of the principal, premium, if any, and interest on the
Notes, whether at Stated Maturity or interest payment date, by acceleration,
call for redemption or otherwise, (b) the due and punctual payment of interest
on the overdue principal of and interest, if any, on the Notes, to the extent
lawful, (c) the due and punctual performance of all other monetary Obligations
of the Company under the Indenture and the Notes to the Noteholders or the Notes
Trustee, all in accordance with the terms set forth in Article 10 of the
Indenture and (d) in case of any extension of time of payment or renewal of any
Notes or any such Obligations, the same will be promptly paid in full when due
or performed in accordance with the terms of the extension or renewal, whether
at Stated Maturity, by acceleration or otherwise and (ii) have agreed to pay any
and all costs and expenses (including reasonable attorneys' fees) incurred by
the Notes Trustee or any Noteholders in enforcing any rights under this Note
Guarantee.
The Obligations of each Subsidiary Guarantor to the Holders of Notes
and to the Notes Trustee pursuant to this Note Guarantee and the Indenture are
expressly set forth in Article 10 of the Indenture and reference is hereby made
to such Indenture for the precise terms of this Note Guarantee.
No stockholder, officer, director or incorporator, as such, past,
present or future of any Subsidiary Guarantor shall have any liability under
this Note Guarantee by reason of his or its status as such stockholder, officer,
director or incorporator.
This is a continuing Note Guarantee and, except as otherwise expressly
provided for in Section 10.06 of the Indenture, shall remain in full force and
effect and shall be binding upon the Subsidiary Guarantor and its successors and
assigns until full and final payment of all of the Company's Obligations under
the Notes and the Indenture and shall inure to the benefit of the successors and
assigns of the Notes Trustee and the Noteholders and, in the event of any
transfer
A-11
117
or assignment of rights by any Noteholder or the Notes Trustee, the rights and
privileges herein conferred upon that party shall automatically extend to and be
vested in such transferee or assignee, all subject to the terms and conditions
hereof. This is a Note Guarantee of payment and not of collectability.
This Note Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Note upon which this Note
Guarantee is noted shall have been executed by the Notes Trustee under the
Indenture by the manual signature of one of its authorized officers.
THE TERMS OF ARTICLE 10 OF THE INDENTURE ARE INCORPORATED
HEREIN BY REFERENCE.
Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
Guarantors:
BLUEGREEN RESORTS MANAGEMENT, INC.
By:
---------------------------------------
Name:
Title:
BLUEGREEN RESORTS, INC.
By:
---------------------------------------
Name:
Title:
BLUEGREEN HOLDING CORPORATION
(TEXAS)
By:
---------------------------------------
Name:
Title:
PROPERTIES OF THE SOUTHWEST ONE, INC.
By:
---------------------------------------
Name:
Title:
A-12
118
PROPERTIES OF THE SOUTHWEST, L.P.
By:
----------------------------
Name:
Title:
BLUEGREEN ASSET MANAGEMENT
CORPORATION
By:
----------------------------
Name:
Title:
BLUEGREEN CAROLINA LAND, INC.
By:
----------------------------
Name:
Title:
BLUEGREEN CORPORATION OF MONTANA
By:
----------------------------
Name:
Title:
BLUEGREEN CORPORATION OF TENNESSEE
By:
----------------------------
Name:
Title:
BLUEGREEN CORPORATION OF THE
ROCKIES
By:
----------------------------
Name:
Title:
A-13
000
XXXXXXXX XXXX & XXXXXX XXXXXXXXXXX
By:
----------------------------------
Name:
Title:
BLUEGREEN COMMUNITIES, INC.
By:
----------------------------------
Name:
Title:
BLUEGREEN RESORTS INTERNATIONAL,
INC.
By:
----------------------------------
Name:
Title:
CAROLINA NATIONAL GOLF CLUB, INC.
By:
----------------------------------
Name:
Title:
LEISURE CAPITAL CORPORATION
By:
----------------------------------
Name:
Title:
PROPERTIES OF THE WEST, INC.
By:
----------------------------------
Name:
Title:
X-00
000
XX/XXX ACQUISITION CORP.
By:
---------------------------------------
Name:
Title:
RDI GROUP, INC.
By:
---------------------------------------
Name:
Title:
DELLONA ENTERPRISES, INC.
By:
---------------------------------------
Name:
Title:
RESORT DEVELOPMENT INTERNATIONAL,
INC.
By:
---------------------------------------
Name:
Title:
RDI RESORT SERVICES CORPORATION
By:
---------------------------------------
Name:
Title:
RDI RESOURCES, INC.
By:
---------------------------------------
Name:
Title:
A-15
121
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
------------------------------------------------------
(Insert assignee's soc. sec. 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.
Date:______________
Your Signature:
-----------------------------------
(Sign exactly as your name appears
on the face of this Note)
A-16
122
In connection with any transfer of this Note occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act") covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) April 1, 2000, the undersigned confirms that it has not
utilized any general solicitation or general advertising in connection with the
transfer and that this Note is being transferred:
CHECK ONE
(1) ___ to the Company or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the
Securities Act; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) that has
furnished to the Notes Trustee a signed letter containing
certain representations and agreements (the form of which
letter can be obtained from the Notes Trustee); or
(4) ___ outside the United States to a "foreign person" in compliance
with Rule 904 of Regulation S under the Securities Act; or
(5 ___ pursuant to the exemption from registration provided by Rule
144 under the Securities Act; or
(6) ___ pursuant to an effective registration statement under the
Securities Act; or
(7) ___ pursuant to another available exemption from the registration
requirements of the Securities Act.
Unless one of the boxes is checked, the Notes Trustee will refuse to register
any of the Notes evidenced by this certificate in the name of any Person other
than the registered Noteholder thereof; provided that if box (3), (4), (5) or
(7) is checked, the Company or the Notes Trustee may require, prior to
registering any such transfer of the Notes, in its sole discretion, such legal
opinions, certifications (including an investment letter in the case of box (3)
or (4)) and other information as the Notes Trustee or the Company has reasonably
requested 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. If none of the foregoing boxes is checked, the Notes Trustee or
Registrar shall not be obligated to register this Note in the name of any person
other than the Noteholder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 2.17 of the Indenture
shall have been satisfied.
Dated:__________________________ Signed:_________________________________
(Sign exactly as name appears on
the other side of this Note)
A-17
123
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
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.
Dated:_______________________ ______________________________________________
NOTICE: To be executed by an executive officer
OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 4.10 or Section 4.14 of the Indenture check the
appropriate box:
[ ] Section 4.10 [ ] Section 4.14
If you want to have only part of the Note purchased by the Company
pursuant to Section 4.10 or Section 4.14 of the Indenture, state the amount you
elect to have purchased:
$______________________
Date:__________________
Your Signature__________________________________
(Sign exactly as your name appears
on the face of this Note)
A-18
124
EXHIBIT B
FORM OF EXCHANGE NOTE
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY OR A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. 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.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
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 HEREON 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.
CUSIP No: __________
(Front of Note)
No. __ $_______________
BLUEGREEN CORPORATION
10 1/2% Senior Secured Notes due 2008, Series B
BLUEGREEN CORPORATION, a Massachusetts corporation promises to pay to CEDE &
CO., or its registered assigns, the principal sum of $__________________ on
April 1, 2008. Interest Payment Dates: April 1 and October 1, commencing October
1, 1998. Record Dates: March 15 and September 15 (whether or not a Business
Day). Additional provisions of this Note are set forth on the other side of this
Note.
B-1
125
Dated:
BLUEGREEN CORPORATION
By: _______________________
By: _______________________
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Notes referred
to in the within-mentioned Indenture
SUNTRUST, CENTRAL FLORIDA, NATIONAL ASSOCIATION
By:_________________________________
Authorized Signatory
B-2
126
(Reverse of Note)
10 1/2% SENIOR SECURED NOTE DUE 2008, Series B
Capitalized terms used herein have the meanings assigned to them in the
Indenture (as defined below) unless otherwise indicated.
1. INTEREST. Bluegreen Corporation, a Massachusetts corporation (the
"Company"), promises to pay interest on the principal amount of this Note at the
rate and in the manner specified below. The Company shall pay, in cash, interest
on the principal amount of this Note at the rate per annum of 10 1/2%. The
Company will pay interest semiannually in arrears on April 1, and October 1, of
each year (each an "Interest Payment Date"), commencing October 1, 1998, or if
any such day is not a Business Day on the next succeeding Business Day. Interest
will be computed on the basis of a 360-day year consisting of twelve 30-day
months. Interest shall accrue from the most recent Interest Payment Date to
which interest has been paid or, if no interest has been paid, from the date of
the original issuance of the Notes. To the extent lawful, the Company shall pay
interest on overdue principal at the rate of 2% per annum in excess of the then
applicable interest rate on the Notes; it shall pay interest on overdue
installments of interest (without regard to any applicable grace periods) at the
same rate to the extent lawful.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the Record Date immediately preceding the Interest
Payment Date, even if such Notes are canceled after such Record Date and on or
before such Interest Payment Date. Noteholders must surrender Notes to a Paying
Agent to collect principal payments. The Company shall pay principal, premium,
if any, and interest in money of the United States that at the time of payment
is legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal, premium, if any, and interest by its
check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Noteholder at the Noteholder's
registered address.
3. PAYING AGENT AND REGISTRAR. Initially, the Notes Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-registrar without prior notice to any Noteholder. The Company or any
Guarantor of the Company may act in any such capacity, except that none of the
Company, its Subsidiaries or their Affiliates shall act (i) as Paying Agent in
connection with any redemption, offer to purchase, discharge or defeasance, as
otherwise specified in the Indenture, and (ii) as Paying Agent or Registrar if a
Default or Event of Default has occurred and is continuing.
4. INDENTURE. The Company issued the Notes under an Indenture, dated as
of April 1, 1998 (the "Indenture"), between the Company and SunTrust, Central
Florida, National Association, as Trustee (the "Trustee"). The terms of the
Notes include those stated in the Indenture and those made part of the Indenture
by reference to the TIA as in effect on the date the Indenture is qualified,
except as otherwise provided in the Indenture. The Notes are subject to all such
terms, and Noteholders are referred to the Indenture and the TIA for a statement
of
B-3
127
such terms. The terms of the Indenture shall govern any inconsistencies between
the Indenture and the Notes. The Notes are senior secured Obligations of the
Company limited to $100,000,000 in aggregate principal amount.
5.(a) OPTIONAL REDEMPTION. Except as indicated in the next succeeding
paragraph, the Notes are not redeemable at the Company's option prior to April
1, 2003. Thereafter, the Notes will be redeemable, at the option of the Company,
in whole or in part, at the redemption prices (expressed as percentages of the
principal amount of the Notes) set forth below, plus accrued interest to the
redemption date:
PERIOD REDEMPTION PRICE
2003......................................................105.25%
2004......................................................103.50%
2005......................................................101.75%
2006 and thereafter.......................................100.00%
(b) OPTIONAL REDEMPTION UPON EQUITY OFFERINGS. At any time, or
from time to time, on or prior to April 1, 2001, the Company may, at
its option, redeem up to 35% of the original aggregate principal amount
of the Notes, with the Net Cash Proceeds of one or more Equity
Offerings by the Company, at a redemption price equal to 100% of the
principal amount thereof, plus accrued and unpaid interest thereon, if
any, to the date of redemption; PROVIDED, HOWEVER, that after any such
redemption, the aggregate principal amount of the Notes outstanding
must equal at least $65 million. In order to effect the foregoing
redemption with the proceeds of any Equity Offering, the Company shall
make such redemption not more than 90 days after the consummation of
any such Equity Offering.
6. MANDATORY REDEMPTION. Except as set forth in Section 7, the Notes
are not subject to mandatory redemption or sinking fund payments.
7. REPURCHASE AT OPTION OF NOTEHOLDER. (a) If there is a Change of
Control, each Holder of Notes will have the right to require the Company to
repurchase all or any part of such Holder's Notes at a repurchase price equal to
101% of the principal amount thereof, plus accrued and unpaid interest, if any,
to the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant Interest Payment
Date). Within 30 days following any Change of Control, the Company will mail a
notice to each Noteholder stating (i) that a Change of Control has occurred and
that such Noteholder has the right to require the Company to repurchase all or
any part of such Noteholder's Notes at a repurchase price in cash equal to 101%
of the principal amount thereof plus accrued and unpaid interest, if any, to the
date of repurchase (subject to the right of Holders of record on the relevant
Record Date to receive interest due on the relevant Interest Payment Date); (ii)
the repurchase date (which will be no earlier then 30 days nor later than 60
days from the date such notice is mailed); and (iii) the procedures, determined
by the Company consistent with the Indenture, that a Noteholder must follow in
order to have its Notes repurchased. Noteholders that are subject to an offer to
B-4
128
repurchase may elect to have such Notes repurchased by completing the form
entitled "Option of Noteholder to Elect Purchase" appearing below.
(b) If the Company or a Restricted Subsidiary consummates any
Asset Disposition, and when the aggregate amount of Net Available Cash
from such an Asset Disposition exceeds $10.0 million, the Company shall
be required to offer to purchase the maximum principal amount of Notes,
that is in an integral multiple of $1,000, that may be purchased out of
the Net Available Cash at 100% of the principal amount thereof, plus
accrued and unpaid interest, if any, to the date fixed for the closing
of such offer in accordance with the procedures set forth in the
Indenture. If the aggregate principal amount of Notes surrendered by
Holders thereof exceeds the amount of Net Available Cash, the Notes to
be redeemed shall be selected on a pro rata basis. Noteholders that are
the subject of an offer to purchase will receive an Asset Disposition
Offer from the Company prior to any related purchase date and may elect
to have such Notes purchased by completing the form entitled "Option of
Noteholder to Elect Purchase" appearing below.
8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least
45 (unless a shorter period is acceptable to the Notes Trustee) before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address. Notes may be redeemed in part but only in whole multiples of $1,000,
unless all of the Notes held by a Noteholder are to be redeemed. On and after
the redemption date, interest ceases to accrue on Notes or portions of them
called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Notes Trustee may require a Noteholder
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. The
Registrar need not exchange or register the transfer of any Note or portion of a
Note selected for redemption. Also, it need not exchange or register the
transfer of any Notes during a period beginning at the opening of business on a
Business Day 15 days before the day of any selection of Notes to be redeemed and
ending at the close of business on the day of selection or during the period
between a Record Date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. Prior to due presentment to the Notes
Trustee for registration of the transfer of this Note, the Notes Trustee, any
Agent and the Company may deem and treat the Person in whose name this Note is
registered as its absolute owner for the purpose of receiving payment of
principal of, premium, if any, and interest on this Note and for all other
purposes whatsoever, whether or not this Note is overdue, and neither the Notes
Trustee, any Agent nor the Company shall be affected by notice to the contrary.
The registered Noteholder shall be treated as its owner for all purposes.
B-5
129
11. AMENDMENTS AND WAIVERS. Subject to certain exceptions provided in
the Indenture, the Indenture or the Notes may be amended with the consent of the
Holders of a majority in principal amount of the then outstanding Notes, and any
existing Default or Event of Default (except a payment default) may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes. Without the consent of any Noteholder the Indenture or the
Notes may be amended to, among other things, cure any ambiguity, defect or
inconsistency, to comply with the requirements of the Commission in order to
effect or maintain qualification of the Indenture under the TIA or to make any
change that does not adversely affect the rights of any Noteholder.
12. DEFAULTS AND REMEDIES. If an Event of Default occurs and is
continuing, the Notes Trustee or the Holders of at least 25% in principal amount
of the then outstanding Notes may declare the unpaid principal of, and any
accrued and unpaid interest on, all the Notes to be due and payable immediately;
provided, that in the case of an Event of Default arising from certain events of
bankruptcy or insolvency with respect to the Company or any Subsidiary
Guarantor, all outstanding Notes shall become due and payable immediately
without further action or notice. Noteholders may not enforce the Indenture or
the Notes except as provided in the Indenture. The Notes Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Notes.
Subject to certain limitations, Holders of a majority in principal amount of the
then outstanding Notes may direct the Notes Trustee in its exercise of any trust
or power. The Notes Trustee may withhold from Noteholders notice of any
continuing default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interests. The Company must
furnish an annual compliance certificate to the Notes Trustee.
13. NOTES TRUSTEE DEALINGS WITH THE COMPANY. The Notes Trustee under
the Indenture, in its individual or any other capacity may make loans to, accept
deposits from, and perform services for the Company, the Subsidiary Guarantors
or any Affiliate of the Company or the Subsidiary Guarantors, and may otherwise
deal with the Company, the Subsidiary Guarantors and their respective Affiliates
as if it were not Notes Trustee.
14. RESTRICTIVE COVENANTS. The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of its Capital
Stock or certain Indebtedness, enter into transactions with Affiliates, create
dividend or other payment restrictions affecting Subsidiaries, merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions provided for in the Indenture. The Company must
annually report to the Notes Trustee on compliance with such limitations.
15. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Notes Trustee or an authenticating agent.
16. NOTE GUARANTEE. Each Subsidiary Guarantor has jointly and severally
irrevocably and unconditionally guaranteed the payment of principal, premium, if
any, and interest (including interest on overdue principal and overdue interest,
if lawful) on the Notes; PROVIDED,
B-6
130
HOWEVER, each Subsidiary Guarantor that makes a payment or distribution under a
Note Guarantee shall be entitled to a contribution from each other Subsidiary
Guarantor in a pro rata amount based on the Adjusted Net Assets of each
Subsidiary Guarantor.
17. DEFEASANCE. Subject to certain conditions provided for in the
Indenture, the Company at any time may terminate some or all of its obligations
under the Notes and the Indenture if the Company deposits with the Notes Trustee
money or U.S. Government Obligations for the payment of principal, premium (if
any) and interest on the Notes to redemption or maturity, as the case may be.
18. GOVERNING LAW. The laws of the State of New York shall govern this
Note and the Indenture, without regard to the principles of conflict of laws of
such State.
19. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Noteholder 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 U/G/M/A
(= Uniform Gifts to Minors Act).
20. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Note Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and has directed the Notes Trustee to
use CUSIP numbers in notices of redemption as a convenience to Noteholders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
The Company will furnish to any Noteholder upon written request and
without charge a copy of the Indenture. Request may be made to:
Bluegreen Corporation
0000 Xxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Chief Financial Officer
B-7
131
FORM OF NOTATION ON SECURITY
RELATING TO NOTE GUARANTEE
NOTE GUARANTEE
The Subsidiary Guarantors (as defined in the Indenture referred to in
the Note upon which this notation is endorsed and each hereinafter referred to
as a "Subsidiary Guarantor," which term includes any successor person under the
Indenture) (i) have jointly and severally irrevocably and unconditionally
guaranteed as a primary obligor and not a surety, (such guarantee by each
Subsidiary Guarantor being referred to herein as the "Note Guarantee") (a) the
due and punctual payment of the principal, premium, if any, and interest on the
Notes, whether at Stated Maturity or interest payment date, by acceleration,
call for redemption or otherwise, (b) the due and punctual payment of interest
on the overdue principal of and interest, if any, on the Notes, to the extent
lawful, (c) the due and punctual performance of all other monetary Obligations
of the Company under the Indenture and the Notes to the Noteholders or the Notes
Trustee, all in accordance with the terms set forth in Article 10 of the
Indenture and (d) in case of any extension of time of payment or renewal of any
Notes or any such Obligations, the same will be promptly paid in full when due
or performed in accordance with the terms of the extension or renewal, whether
at Stated Maturity by acceleration or otherwise and (ii) have agreed to pay any
and all costs and expenses (including reasonable attorneys' fees) incurred by
the Notes Trustee or any Noteholders in enforcing any rights under this Note
Guarantee.
The Obligations of each Subsidiary Guarantor to the Holders of Notes
and to the Notes Trustee pursuant to this Note Guarantee and the Indenture are
expressly set forth in Article 10 of the Indenture and reference is hereby made
to such Indenture for the precise terms of this Note Guarantee.
No stockholder, officer, director or incorporator, as such, past,
present or future of any Subsidiary Guarantor shall have any liability under
this Note Guarantee by reason of his or its status as such stockholder, officer,
director or incorporator.
This is a continuing Note Guarantee and, except as otherwise expressly
provided for in Section 10.06 of the Indenture, shall remain in full force and
effect and shall be binding upon the Subsidiary Guarantor and its successors and
assigns until full and final payment of all of the Company's Obligations under
the Notes and the Indenture and shall inure to the benefit of the successors and
assigns of the Notes Trustee and the Noteholders and, in the event of any
transfer or assignment of rights by any Noteholder or the Notes Trustee, the
rights and privileges herein conferred upon that party shall automatically
extend to and be vested in such transferee or assignee, all subject to the terms
and conditions hereof. This is a Note Guarantee of payment and not of
collectability.
This Note Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Note upon which this Note
Guarantee is noted shall have been executed
B-8
132
by the Notes Trustee under the Indenture by the manual signature of one of its
authorized officers.
THE TERMS OF ARTICLE 10 OF THE INDENTURE ARE INCORPORATED
HEREIN BY REFERENCE.
Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
Guarantors:
BLUEGREEN RESORTS MANAGEMENT, INC.
By:
------------------------------------
Name:
Title:
BLUEGREEN RESORTS, INC.
By:
------------------------------------
Name:
Title:
BLUEGREEN HOLDING CORPORATION
(TEXAS)
By:
------------------------------------
Name:
Title:
PROPERTIES OF THE SOUTHWEST ONE, INC.
By:
------------------------------------
Name:
Title:
PROPERTIES OF THE SOUTHWEST, L.P.
By:
------------------------------------
Name:
Title:
X-0
000
XXXXXXXXX XXXXX MANAGEMENT CORPORATION
By:
------------------------------------
Name:
Title:
BLUEGREEN CAROLINA LAND, INC.
By:
------------------------------------
Name:
Title:
BLUEGREEN CORPORATION OF MONTANA
By:
------------------------------------
Name:
Title:
BLUEGREEN CORPORATION OF TENNESSEE
By:
------------------------------------
Name:
Title:
BLUEGREEN CORPORATION OF THE ROCKIES
By:
------------------------------------
Name:
Title:
VIRGINIA LAND & FOREST CORPORATION
By:
------------------------------------
Name:
Title:
B-10
134
BLUEGREEN COMMUNITIES, INC.
By:
------------------------------------
Name:
Title:
BLUEGREEN RESORTS INTERNATIONAL,
INC.
By:
------------------------------------
Name:
Title:
CAROLINA NATIONAL GOLF CLUB, INC.
By:
------------------------------------
Name:
Title:
LEISURE CAPITAL CORPORATION
By:
------------------------------------
Name:
Title:
PROPERTIES OF THE WEST, INC.
By:
------------------------------------
Name:
Title:
BG/RDI ACQUISITION CORP.
By:
------------------------------------
Name:
Title:
X-00
000
XXX GROUP, INC.
By:
----------------------------------------
Name:
Title:
DELLONA ENTERPRISES, INC.
By:
----------------------------------------
Name:
Title:
RESORT DEVELOPMENT INTERNATIONAL,
INC.
By:
----------------------------------------
Name:
Title:
RDI RESORT SERVICES CORPORATION
By:
----------------------------------------
Name:
Title:
RDI RESOURCES, INC.
By:
----------------------------------------
Name:
Title:
B-12
136
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
------------------------------------------------------
(Insert assignee's soc. sec. 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.
Date:______________
Your Signature:
----------------------------------
(Sign exactly as your name appears
on the face of this Note)
B-13
137
OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 4.10 or Section 4.14 of the Indenture check the
appropriate box:
[ ] Section 4.10 [ ] Section 4.14
If you want to have only part of the Note purchased by the company
pursuant to Section 4.10 or Section 4.14 of the Indenture, state the amount you
elect to have purchased:
$______________________
Date:__________________
Your Signature:__________________________
(Sign exactly as your name appears on the
face of this Note)
B-14
138
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
------------, ----
SunTrust, Central Florida, National Association
000 Xxxx Xxxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Bluegreen Corporation
10 1/2% Senior Notes due 2008
Ladies and Gentlemen:
In connection with our proposed purchase of 10 1/2% Senior Secured
Notes due 2008 (the "Notes") of Bluegreen Corporation (the "Company"), we
confirm that:
1. We have received a copy of the Offering Memorandum (the
"Offering Memorandum"), dated March 27, 1998 relating to the
Notes and such other information as we deem necessary in order
to make our investment decision. We acknowledge that we have
read and agreed to the matters stated on pages (ii) and (iii)
of the Offering Memorandum and in the section entitled
"Transfer Restrictions" of the Offering Memorandum including
the restrictions on duplication and circulation of the
Offering Memorandum. We acknowledge that we have had access to
such financial and other information, and have been offered
the opportunity to ask such questions of representatives of
the Company and receive answers thereto, as we have deemed
necessary.
2. We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in
the Indenture relating to the Notes (as described in the
Offering Memorandum) and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer the Notes
except in compliance with, such restrictions and conditions
and the Securities Act of 1933, as amended (the "Securities
Act"). We are not acquiring the Notes with a view to any
distribution thereof in a transaction that would violate the
Securities Act.
3. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes
may not be offered or sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated,
that if we should sell
C-1
139
or otherwise transfer any Notes prior to the date which is two
years after the original issuance of the Notes, we will do so
only (i) to the Company or any of its subsidiaries, (ii)
inside the United States in accordance with Rule 144A under
the Securities Act to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act), (iii) inside
the United States to an institutional "accredited investor"
(as defined below) that, prior to such transfer, furnishes (or
has furnished on its behalf by a U.S. broker-dealer) to the
Notes Trustee (as defined in the Indenture relating to the
Notes), a signed letter containing certain representations and
agreements relating to the restrictions on transfer of the
Notes and an opinion (the form of which can be obtained from
the Notes Trustee) and on opinion of counsel satisfactory to
the Company that such transfer is in compliance with the
Securities Act, (iv) outside the United States in accordance
with Rule 904 of Regulation S under the Securities Act to
persons other than U.S. persons (as defined in Regulation S),
(v) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act (if available), or (vi)
pursuant to an effective registration statement under the
Securities Act, and we further agree to provide to any person
purchasing any of the Notes from us a notice advising such
purchaser that resales of the Notes are restricted as stated
herein.
4. We are not acquiring the Notes for or on behalf of, and will
not transfer the Notes to, any pension or welfare plan (as
defined in Section 3 of the Employee Retirement Income
Security Act of 1974), except as permitted in the section
entitled "Transfer Restrictions" of the Offering Memorandum.
5. We understand that, on any proposed resale of any Notes, we
will be required to furnish to the Notes Trustee and the
Company such certification, legal opinions and other
information as the Notes Trustee and the Company may
reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that
the Notes purchased by us will bear a legend to the foregoing
effect.
6. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the
Securities Act) and have such knowledge and experience in
financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Notes, and we
and any accounts for which we are acting are each able to bear
the economic risk of our or their investment, as the case may
be.
7. We are acquiring the Notes purchased by us for our account or
for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole
investment discretion.
C-2
140
You, the Company and other interested parties 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 proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
By:________________________________
Name:
C-3
141
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
---------------, ----
SunTrust Bank, Central Florida, National Association
000 Xxxx Xxxxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Bluegreen Corporation
(the "Company") 10 1/2% Senior
Notes due 2008 (the "Notes")
Ladies and Gentlemen:
In connection with our proposed sale of $_____________ aggregate
principal amount of the Notes, we confirm and represent that such sale has been
effected pursuant to and in accordance with Regulation S under the U.S.
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
further represent that:
(1) We have received a copy of the Offering Memorandum (the
"Offering Memorandum"), dated March 27, 1998 relating to the
Notes and such other information as we deem necessary in order
to make our investment decision. We acknowledge that we have
read and agreed to the matters stated on pages (ii) and (iii)
of the Offering Memorandum and in the section entitled
"Transfer Restrictions" of the Offering Memorandum including
the restrictions on duplication and circulation of the
Offering Memorandum. We acknowledge that we have had access to
such financial and other information, and have been offered
the opportunity to ask such questions of representatives of
the Company and receive answers thereto, as we have deemed
necessary.
(2) We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in
the Indenture relating to the Notes (as described in the
Offering Memorandum) and the undersigned agrees to be bound
by, and not to resell, pledge or otherwise transfer the Notes
except in compliance with, such restrictions and conditions
and the Securities Act of 1933, as amended
D-1
142
(the "Securities Act"). We are not acquiring the Notes with a
view to any distribution thereof in a transaction that would
violate the Securities Act.
(3) the offer of the Notes was not made to a Person in the United
States;
(4) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person
acting on our behalf reasonably believed that the transferee
was outside the United States, or (b) the transaction was
executed in, on or through the facilities of a designated
off-shore securities market and neither we nor any person
acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(5) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or
Rule 904(b) of Regulation S, as applicable;
(6) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(7) we have advised the transferee of the transfer restrictions
applicable to the Notes.
(8) we understand that the Notes have not been registered under
the Securities Act and no transfer thereof may be made, except
when such Notes are registered or are transferred pursuant to
an applicable exemption.
You, the Company and others 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. Terms used in this certificate have
the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:__________________________
Authorized Signature
D-2
143
EXHIBIT E
[Letterhead of Notes Trustee]
[Date]
[Name and Address of Escrow Agent]
Re: Indenture Dated as of April 1, 1998,
By and Among Bluegreen Corporation,
as Issuer, Certain of its Subsidiaries as
Subsidiary Guarantors, and SunTrust Bank,
Central Florida, National Association,
as Notes Trustee (the "Indenture")
$110,000,000 at 10 1/2% Senior Secured
Notes Due 2008 (the "Notes")
----------------------------
Ladies and Gentlemen:
As Notes Trustee under the Indenture and pursuant to a request
made by [name of subsidiary guarantor] ("Subsidiary Guarantor") pursuant to
Section 11.03(c) thereof, we are delivering to you, in escrow, subject to your
strict compliance with the terms and conditions of this letter, [number]
executed counterparts of a [partial release of mortgage/partial reconveyance of
deed of trust] (the "Release Instruments") pertaining to Residential Lots (the
"Residential Lots") in the [name of project] in [name of County], County,
[State] (the "Project"), each of which has been executed in blank.
You are authorized and directed, as escrow agent, to file, or
cause to be filed for record, in the county and state aforesaid, a Release
Instrument pertaining to each Residential Lot at the time of its conveyance by
the Subsidiary Guarantor provided that you have received a certification from
the Subsidiary Guarantor, certifying that each of the following terms and
conditions has been satisfied with respect to such Residential Lot:
(i) Subsidiary Guarantor has entered into a contract
of sale (the "Contract of Sale") pertaining to Lot No. _____
in the Project;
(ii) Subsidiary Guarantor had not received notice
from SunTrust, Central Florida, National Association, or any
successor trustee thereunder, that it has
E-1
144
notified the holders of the Notes of any Event of Default as provided
in Section 7.05 of the Indenture at the time of entry into such
Contract of Sale;
(iii) the Contract of Sale for the Residential Lot
was entered into at arms-length with a bona fide purchaser in
the ordinary course of business with a purchaser which is not
an affiliate of Bluegreen Corporation or Subsidiary Guarantor;
(iv) the Residential Lot has been lawfully subdivided
and may be legally conveyed using the legal description set
forth in the Contract of Sale;
(v) the sale price of the Residential Lot represents,
in the good faith opinion of Subsidiary Guarantor, the fair
market value thereof; and
(vi) the Contract of Sale only provides such offsets
against, or deductions from, the sales price, including
closing costs, commissions, and fees, as are usual and
customary in transactions involving the sales of undeveloped
Residential Lots in [State].
Upon receipt of a written notice from the undersigned
indicating that the undersigned has sent a notice of an Event of Default to the
holders of the Notes in accordance with Section 7.05 of the Indenture, you are
not to deliver any further Release Instruments, but, instead, shall return all
Release Instruments then in your possession to the undersigned at once.
Please indicate your agreement to the terms and conditions set
forth in this letter by countersigning and returning to us a copy hereof.
Very truly yours,
SUNTRUST BANK, CENTRAL FLORIDA,
NATIONAL ASSOCIATION, TRUSTEE
By:
------------------------------------
Name:
Title:
The undersigned hereby agrees to the terms and conditions of the above letter.
[NAME OF ESCROW AGENT]
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
E-2
145
EXHIBIT F
[Letterhead of Notes Trustee]
[Date]
[Name and Address of Escrow Agent]
Re: Indenture Dated as of April 1, 1998,
By and Among Bluegreen Corporation,
as Issuer, Certain of its Subsidiaries as
Subsidiary Guarantors, and SunTrust Bank,
Central Florida, National Association,
as Notes Trustee (the "Indenture")
$110,000,000 at 10 1/2% Senior Secured
Notes Due 2008 (the "Notes")
----------------------------
Ladies and Gentlemen:
As Notes Trustee under the Indenture and pursuant to a request
made by [name of subsidiary guarantor] ("Subsidiary Guarantor") pursuant to
Section 11.03(e) thereof, we are delivering to you, in escrow, subject to your
strict compliance with the terms and conditions of this letter, [number]
executed counterparts of a [partial release of mortgage/partial reconveyance of
deed of trust] (the "Release Instruments") pertaining to certain parcels of
property to be transferred in bulk (the "Bulk Transfer Property") in the [name
of project] in [name of County], County, [State] (the "Project"), each of which
has been executed in blank.
You are authorized and directed, as escrow agent, to file, or
cause to be filed for record, in the county and state aforesaid, a Release
Instrument pertaining to each parcel of Bulk Transfer Property at the time of
its conveyance by the Subsidiary Guarantor provided that you have received a
certification from the Subsidiary Guarantor, certifying that each of the
following terms and conditions has been satisfied with respect to such Bulk
Transfer Property:
(i) Subsidiary Guarantor has entered into a contract
of sale (the "Contract of Sale") pertaining to such Bulk
Transfer Property;
(ii) Subsidiary Guarantor had not received notice
from SunTrust, Central Florida, National Association, or any
successor trustee thereunder, that it has
F-1
146
notified the holders of the Notes of any Event of Default as provided
in Section 7.05 of the Indenture at the time of entry into such
Contract of Sale;
(iii) the Contract of Sale for the Bulk Transfer
Property was entered into at arms-length with a bona fide
purchaser in the ordinary course of business with a purchaser
which is not an affiliate of Bluegreen Corporation or
Subsidiary Guarantor;
(iv) the Bulk Transfer Property has been lawfully
subdivided and may be legally conveyed using the legal
description set forth in the Contract of Sale;
(v) the sale price of the Bulk Transfer Property
represents, in the good faith opinion of Subsidiary Guarantor,
the fair market value thereof; and
(vi) the Contract of Sale only provides such offsets
against, or deductions from, the sales price, including
closing costs, commissions, and fees, as are usual and
customary in transactions involving the sales of undeveloped
property such as to the Bulk Transfer Property in [State].
Upon receipt of a written notice from the undersigned
indicating that the undersigned has sent a notice of an Event of Default to the
holders of the Notes in accordance with Section 7.05 of the Indenture, you are
not to deliver any further Release Instruments, but, instead, shall return all
Release Instruments then in your possession to the undersigned at once.
Please indicate your agreement to the terms and conditions set
forth in this letter by countersigning and returning to us a copy hereof.
Very truly yours,
SUNTRUST BANK, CENTRAL FLORIDA,
NATIONAL ASSOCIATION, TRUSTEE
By:
------------------------------------
Name:
Title:
The undersigned hereby agrees to the terms and conditions of the above letter.
[NAME OF ESCROW AGENT]
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
F-2
147
SCHEDULE P
AMOUNT OF
PROPERTY OWNER TITLE INSURANCE
-------- ----- ---------------
CROSSROADS RANCH PROPERTIES OF THE WEST, INC. $2,300,000
YAVAPAI COUNTY
ARIZONA
EAGLES LANDING BLUEGREEN CORPORATION OF THE 900,000
LAS ANIMAS COUNTY ROCKIES
COLORADO
XXXXXXX AT CASTLEWOOD BLUEGREEN CORPORATION OF THE 2,000,000
XXXXXXX COUNTY ROCKIES
COLORADO
WHITEWATER WILDERNESS RANCH BLUEGREEN CORPORATION OF 675,000
IDAHO COUNTY MONTANA
IDAHO
GRASSY MOUNTAIN RANCH BLUEGREEN CORPORATION OF 1,500,000
XXXXXXX/XXXXXXXXXX COUNTIES MONTANA
MONTANA
RANCHES OF SONTERRA PROPERTIES OF THE SOUTHWEST, 2,340,000
LINCOLN COUNTY L.P.
NEW MEXICO
HICKORY BLUFF BLUEGREEN CAROLINA LAND, INC. 329,000
ONSLOW COUNTY
NORTH CAROLINA
WINDING RIVER PLANTATION BLUEGREEN CAROLINA LAND, INC. 9,124,000
BRUNSWICK COUNTY
NORTH CAROLINA
SEASIDE AT WINDING RIVER BLUEGREEN CAROLINA LAND, INC. 300,000
BRUNSWICK COUNTY
NORTH CAROLINA
SOUTHPORT BLUEGREEN CAROLINA LAND, INC. 1,274,000
BRUNSWICK COUNTY
NORTH CAROLINA
BAY HARBOR BLUEGREEN CAROLINA LAND, INC. 1,358,000
BEAUFORT COUNTY
XXXXX XXXXXXXX
X-0
000
XXXX XXXXX PROPERTIES OF THE SOUTHWEST, 6,181,000
DALLAS COUNTY L.P.
TEXAS
BENT WATER PROPERTIES OF THE SOUTHWEST, 3,400,000
HOOD COUNTY L.P.
TEXAS
HIDDEN LAKES PROPERTIES OF THE SOUTHWEST, 2,780,000
XXXXXXX COUNTY L.P.
TEXAS
XXX XXXXXXX RANCH PROPERTIES OF THE SOUTHWEST, 888,000
XXXX COUNTY L.P.
TEXAS
RIVER MOUNTAIN RANCH PROPERTIES OF THE SOUTHWEST, 3,500,000
XXXXXXX COUNTY L.P.
TEXAS
TAMARON PROPERTIES OF THE SOUTHWEST, 870,000
BEXAR/XXXXXX COUNTIES L.P.
TEXAS
SUMMER VALLEY PROPERTIES OF THE SOUTHWEST, 800,000
XXXX COUNTY L.P.
TEXAS
CLEAR CREEK ESTATES PROPERTIES OF THE SOUTHWEST, 330,000
XXXXXXXXXX COUNTY L.P.
TEXAS
LAKE HOUSTON PROPERTIES OF THE SOUTHWEST, 1,947,000
XXXXXX COUNTY L.P.
TEXAS
WHITE OAK ESTATES PROPERTIES OF THE SOUTHWEST, 900,000
XXXXXXXXXX COUNTY L.P.
TEXAS
XXXXXXX AT XXXXXXXX VIRGINIA LAND & FOREST 920,000
KING XXXXXX COUNTY CORPORATION
XXXXXXXX
XXXXX OF THE POTOMAC VIRGINIA LAND & FOREST 830,000
NORTH UMBERLAND COUNTY CORPORATION
VIRGINIA
P-2
149
SOUTHGATE VIRGINIA LAND & FOREST 744,000
NORTH UMBERLAND COUNTY CORPORATION
VIRGINIA
TWIN HARBORS VIRGINIA LAND & FOREST 249,000
NORTH UMBERLAND COUNTY CORPORATION
VIRGINIA
P-3