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EXHIBIT 4.1
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Supplemental Indenture
No. 2
to
Indenture dated as of March 18, 1997
Re:
Up to $200,000,000 12 1/2% Senior Notes due 2007
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This SUPPLEMENTAL INDENTURE NO. 2 to INDENTURE (the "Supplemental
Indenture") is entered into among Booth Creek Ski Holdings, Inc., a Delaware
corporation (the "Company"), Trimont Land Company, a California corporation,
Sierra-at-Tahoe, Inc., a Delaware corporation, Bear Mountain, Inc., a Delaware
corporation, Waterville Valley Ski Resort, Inc., a Delaware corporation, Mount
Cranmore Ski Resort, Inc., a Delaware corporation, Booth Creek Ski Acquisition
Corp., a Delaware corporation, Ski Lifts, Inc., a Washington corporation, Grand
Targhee Incorporated, a Delaware corporation, B-V Corporation, a Wyoming
corporation, Targhee Company, a Delaware corporation, and Targhee Ski Corp., a
Delaware corporation (collectively, the "Guarantors"), and Marine Midland Bank,
a New York banking corporation and trust company (the "Trustee").
RECITALS
WHEREAS, the Company, the Guarantors and the Trustee have entered into
that certain Indenture dated as of March 18, 1997, as supplemented by Amendment
No. 1 dated as of April 25, 1997 (the "Original Indenture") providing for the
issuance and delivery by the Company of its 12 1/2% Senior Notes due 2007;
WHEREAS, the Company is entering into certain financing and related
transactions (the "Transactions") which will benefit the Company and its
Subsidiaries; and
WHEREAS, Article 8 of the Indenture provides a manner by which the
Indenture may be amended, and by which compliance with the provisions of the
Indenture may be waived, with the consent of the Holders of a majority in
aggregate principal amount of the then outstanding Notes by written act of said
Holders delivered to the Company and the Trustee; and
WHEREAS, the Holders of a majority in aggregate principal amount of
the outstanding Notes have delivered said consents to the Trustee and the
Company; and
WHEREAS, pursuant to and in accordance with Section 8.02 of the
Indenture, and with the consent of the Holders of a majority in aggregate
principal amount of the outstanding Securities, the Company, the Guarantors and
the Trustee have agreed to enter into this Supplemental Indenture;
NOW THEREFORE, in consideration of the mutual agreements contained
herein and for other good and valuable consid-
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eration, the receipt and adequacy of which is hereby acknowledged, the parties
hereto agree as follows for the benefit of each other party and for the equal
and ratable benefit of the Holders of the Company's 12 1/2% Senior Notes due
2007:
Section 1. AMENDMENTS AND WAIVER.
1.1. Subject to Section 2.2 hereof, the definition of "Change
of Control" contained in Section 1.01 of the Indenture is hereby amended to read
in its entirety as follows:
A "Change of Control" of the Company means the occurrence of
one or more of the following events: (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 to any Person
or group of related Persons for purposes of Section 13(d) of the
Exchange Act (a "Group"), together with any Affiliates thereof;
(ii) the approval by the holders of Capital Stock of the Company of any
plan or proposal for the liquidation or dissolution of the Company;
(iii) prior to a Qualified IPO, Xxxx Xxxxxxx Mutual Life Insurance
Company and/or its Affiliates (other than its portfolio companies,
including without limitation, the Parent and its Subsidiaries) shall
cease to beneficially own (within the meaning of Rule 13d-3 under the
Exchange Act), directly or indirectly, Voting Stock representing, or
Class B Common Stock and/or warrants exercisable for shares of Class B
Common Stock representing upon conversion, at least 40% of the total
voting power of all Voting Stock of the Company or Parent on a fully
diluted basis; (iv) any Person or Group (other than the Permitted
Holders) shall become the beneficial owner, directly or indirectly, of
Voting Stock representing, or Common Stock or Warrants exercisable for
Common Stock representing upon conversion, more than 35% of the total
voting power of all Voting Stock of the Company or Parent on a fully
diluted basis; (v) prior to a Qualified IPO, Booth Creek Partners Ltd.
II, L.L.L.P. or any Affiliate thereof that is a Permitted Holder shall
cease to have the right to appoint a majority of the Board of Directors
of Parent; (vi) the replacement of a majority of the Board of Directors
of Parent over a two-year period from the directors who constituted the
Board of Directors of Parent at the beginning of such period, and such
re-
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placement shall not have been approved or recommended by a vote
of at least two-thirds of the Board of Directors of Parent then still
in office who either were members of such Board of Directors at the
beginning of such period or whose election as a member of such Board
of Directors was previously so approved; (vii) there shall be
consummated any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant to
which the Common Stock of the Company would be converted into cash,
securities or other property, other than a merger or consolidation of
the Company in which holders of the Common Stock of the Company
outstanding immediately prior to the consolidation or merger hold,
directly or indirectly, at least a majority of the Common Stock of the
surviving corporation immediately after such consolidation or merger;
(viii) Xxxxxx X. Xxxxxxx, Xx. ceases, other than by death or
disability, to have an executive management position with the Company;
or (ix) any creditor of Parent shall foreclose on any Capital Stock of
the Company.
1.2. Subject to Section 2.2 hereof, the definition of
"Permitted Indebtedness" contained in Section 1.01 of the Indenture is hereby
amended to read in its entirety as follows:
"Permitted Indebtedness" means:
(i) Indebtedness of the Company or any Restricted
Subsidiary arising under or in connection with the Senior
Credit Facility in a principal amount at any time not to exceed
$25,000,000, less each permanent reduction of commitments to extend
credit thereunder as provided for under this Indenture;
(ii) Indebtedness under Notes issued by the Company
pursuant to this Indenture in an aggregate principal amount of
up to $133,500,000 and Indebtedness evidenced by the Guarantees;
(iii) Indebtedness not covered by any other clause of
this definition which is outstanding on the date of this
Indenture;
(iv) Indebtedness of the Company to any Restricted
Subsidiary and Indebtedness of any Re-
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stricted Subsidiary to the Company or another Restricted
Subsidiary;
(v) Purchase Money Indebtedness and Capitalized Lease
Obligations incurred to acquire property in the ordinary course
of business, which Purchase Money Indebtedness and Capitalized Lease
Obligations do not in the aggregate exceed $2,500,000 at any time
outstanding;
(vi) Obligations of the Company or any Restricted
Subsidiary under (A) Interest Rate Agreements designed to
protect against fluctuations in interest rates in respect of
Indebtedness of the Company and its Restricted Subsidiaries
permitted to be incurred under this Indenture, which obligations do
not exceed the aggregate principal amount of such Indebtedness, and
(B) Currency Agreements designated to protect the Company and its
Subsidiaries against fluctuations in foreign currency exchange rates
in respect of foreign exchange exposures incurred by the Company and
its Restricted Subsidiaries;
(vii) Indebtedness incurred by the Company or any of its
Restricted Subsidiaries constituting reimbursement obligations
with respect to letters of credit issued in the ordinary course of
business, including, without limitation, letters of credit in
respect of workers' compensation claims or self-insurance, or other
Indebtedness with respect to reimbursement type obligations
regarding workers' compensation claims; provided, however, that upon
the drawing of such letters of credit or the incurrence of such
Indebtedness, such obligations are reimbursed within 30 days
following such drawing or incurrence;
(viii) Indebtedness arising from agreements of the
Company or a Restricted Subsidiary providing for
indemnification, adjustment of purchase price or similar
obligations, in each case, incurred or assumed in connection with
the acquisition or disposition of any business, assets or a
Subsidiary;
(ix) obligations in respect of performance and surety
bonds and completion guarantees pro-
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vided by the Company or any Restricted Subsidiary in the
ordinary course of business;
(x) any guarantee by the Company of Indebtedness or
other obligations of any of its Restricted Subsidiaries, and
any guarantee by any Restricted Subsidiary of Indebtedness of the
Company or any other Restricted Subsidiary, so long as the
incurrence of such Indebtedness is permitted under the terms of the
Indenture;
(xi) additional Indebtedness of the Company and its
Restricted Subsidiaries not to exceed $2,500,000 in principal
amount outstanding at any time;
(xii) Refinancing Indebtedness; and
(xiii) Indebtedness assumed and subsequently repaid on
the Issue Date in connection with the acquisition of Grand Targhee
Incorporated.
1.3. Subject to Section 2.2 hereof, the definition of
"Restricted Subsidiary" contained in Section 1.01 of the Indenture is hereby
amended to read in its entirety as follows:
"Restricted Subsidiary" means a Subsidiary of the
Company other than an Unrestricted Subsidiary and includes all of
the Subsidiaries of the Company existing as of the Issue Date,
except the Real Estate LLC. The Board of Directors of the Company
may designate any Unrestricted Subsidiary or any Person that is to
become a Subsidiary as a Restricted Subsidiary if immediately
after giving effect to such action (and treating any Acquired
Indebtedness as having been incurred at the time of such action),
(i) the Company could have incurred at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.06 of this Indenture or (ii) the ratio of the Company's
EBITDA to the Company's Consolidated Interest Expense (determined
on a pro forma basis for the last four fiscal quarters of the
Company for which financial statements are available at the date
of determination in accordance with Section 4.06 of this
Indenture) does not decrease and the Company does not incur any
Indebt-
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edness (other than Indebtedness under the Notes permitted
under clause (ii) of the definition of "Permitted Indebtedness"
and up to $1.5 million of additional Permitted Indebtedness) in
connection with such action.
1.4. Subject to Section 2.2 hereof, the first paragraph of
Section 2.01 of the Indenture is hereby amended to read in its entirety as
follows:
The Trustee shall authenticate (i) Notes for original issue
on the Issue Date in the aggregate principal amount of
$110,000,000, (ii) in the event of an exercise by the Initial
Purchaser pursuant to Section 2.2(b) of the Purchase Agreement of its
option to purchase up to an additional $6,000,000 aggregate principal
amount of Notes (the "Option Notes"), Option Notes for original issue
in the aggregate principal amount not to exceed $6,000,000, which
Option Notes may not be issued after April 25, 1997 and (iii) Notes
(other than Option Notes) for original issue subsequent to the Issue
Date in an aggregate principal amount not to exceed $90,000,000 (minus
the aggregate principal amount of any Option Notes authenticated
pursuant to the terms hereof) in one or more series ("Subsequent
Series Notes"), in each case upon a written order of the Company in
the form of an Officers' Certificate of the Company; provided,
however, that no Subsequent Series Notes may be authenticated and
delivered in an aggregate principal amount of less than $15,000,000;
and provided, further, that the Company must, in issuing any
Subsequent Series Notes, comply with Section 4.06. Each such written
order shall specify the amount of Notes to be authenticated, the date
on which the Notes are to be authenticated and the title of the Notes
of the series (which shall distinguish the Notes of the series from
Notes of any other series). All Notes issued on the Issue Date, Option
Notes and Subsequent Series Notes shall be identical in all respects
other than issue dates and the date from which interest accrues and
except as provided in this Section 2.01 and except that any Subsequent
Series Notes may contain any notations, legends or endorsements
permitted under Section 2.02. The aggregate principal amount of Notes
outstanding at any time may not exceed $200,000,000, except as
provided in Section 2.08.
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1.5. Subject to Section 2.2 hereof, paragraph 5 of Exhibit A,
the Form of Notes, is hereby amended to read in its entirety as follows:
5. Optional Redemption. The Company, at its option, may
redeem the Notes, in whole or in part, at any time on or after
March 15, 2002 upon not less than 30 nor more than 60 days' notice, at
the redemption prices (expressed as percentages of principal amount),
set forth below, together, in each case, with accrued and unpaid
interest to the Redemption Date, if redeemed during the twelve month
period beginning on March 15 of each year listed below:
YEAR REDEMPTION PRICE
---- ----------------
2002....................... 106.250%
2003....................... 104.167%
2004....................... 102.083%
2005 and thereafter........ 100.000%
Notwithstanding the foregoing, the Company may redeem in the
aggregate up to 30% of the original principal amount of Notes at any
time and from time to time on or prior to March 15, 2000 at a
redemption price equal to 112.5% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon to the Redemption
Date with the Net Proceeds of one or more Public Equity Offerings;
provided, that at least $93.5 million of the principal amount of Notes
originally issued remains outstanding immediately after the occurrence
of any such redemption and that any such redemption occurs within 90
days following the closing of any such Public Equity Offering.
1.6. Subject to Section 2.2 hereof, compliance by the Company
with Sections 5.01 and 5.02 of the Indenture are hereby waived to the extent any
default would occur under such Sections as a result of the transactions
contemplated by the Loon Mountain Acquisition (as defined in the Offering
Memorandum relating to the Company's 12 1/2% Series C Senior Notes due 2007).
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Section 2. MISCELLANEOUS.
2.1. GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE.
2.2. Operative Time. Upon the execution and delivery of this
Supplemental Indenture by the Company, the Guarantors and the Trustee, the
Indenture shall be supplemented in accordance herewith, and this Supplemental
Indenture shall form a part of the Indenture for all purposes, and every Holder
of Notes heretofore or hereafter authenticated and delivered under the Indenture
shall be bound thereby; provided, however, that Section 1 hereof shall become
operative upon the satisfaction (or waiver by the Company) of the Conditions (as
defined in the Consent Solicitation Statement, dated February 16, 1998, that was
provided to Holders of Notes in connection with the Company's solicitation of
consents by such Holders to the waiver and amendments set forth herein). Upon
the receipt by the Trustee of (i) an Officers' Certificate certifying that such
conditions have been satisfied, or waived by the Company, and (ii) an Opinion of
Counsel to the effect set forth in Section 8.06 of the Indenture, the amendments
set forth herein shall become operative.
2.3. Confirmation of the Original Indenture. Except as
amended hereby, the Original Indenture shall remain in full force and effect and
is hereby ratified and confirmed in all respects.
2.4. Multiple Counterparts. The parties may sign multiple
counterparts of this Supplemental Indenture. Each signed counterpart shall be
deemed an original, but all of them together represent one and the same
agreement.
2.5. Separability. Each provision of this Supplemental
Indenture shall be considered separable and if for any reason any provision
which is not essential to the effectuation of the basic purpose of this
Supplemental Indenture 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.
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2.6. Headings. The captions of the various section headings
of this Supplemental Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
2.7. The Trustee. The Trustee shall not be responsible in any
manner whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Company and the Guarantors.
2.8. Definitions. All terms defined in the Indenture shall
have the same meaning in this Supplemental Indenture unless otherwise defined
herein.
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IN WITNESS WHEREOF, the parties hereto caused this
Supplemental Indenture to be duly executed as of this 20th day of
February, 1998.
BOOTH CREEK SKI HOLDINGS, INC.
TRIMONT LAND COMPANY
SIERRA-AT-TAHOE, INC.
BEAR MOUNTAIN, INC.
WATERVILLE VALLEY SKI RESORT, INC.
MOUNT CRANMORE SKI RESORT, INC.
BOOTH CREEK SKI ACQUISITION CORP.
SKI LIFTS, INC.
GRAND TARGHEE INCORPORATED
B-V CORPORATION
TARGHEE COMPANY
TARGHEE SKI CORP.
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Executive
Vice President, Finance
MARINE MIDLAND BANK, as Trustee
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Vice President
