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EXHIBIT 2.4
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SECURITIES PURCHASE AGREEMENT
by and among
BOOTH CREEK SKI HOLDINGS, INC.,
THE GUARANTORS NAMED HEREIN
and
THE INITIAL PURCHASER NAMED HEREIN
______________________
Dated as of February 23, 1998
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1. Definitions 1
Section 1.2. Accounting Terms; Financial Statements 8
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASER
Section 2.1. Issue of Notes 8
Section 2.2. Purchase, Sale and Delivery of Notes 9
Section 2.3. Registration Rights of Holders of Notes 10
Section 2.4. Offering by the Initial Purchaser 10
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of the Company
and the Guarantors 10
Section 3.2. Resale of Notes 27
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the
Initial Purchaser 28
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the Guarantors 30
ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes 33
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ARTICLE VII
INDEMNITY
Section 7.1. Indemnity 34
Section 7.2. Contribution 37
Section 7.3. Registration Rights Agreement 38
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions 38
Section 8.2. Termination 39
Section 8.3. No Waiver; Modifications in Writing 40
Section 8.4. Information Supplied by the Initial Purchaser 40
Section 8.5. Communications 41
Section 8.6. Execution in Counterparts 41
Section 8.7. Successors 41
Section 8.8. Governing Law 42
Section 8.9. Severability of Provisions 42
Section 8.10. Headings 42
SIGNATURE PAGE 43
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SECURITIES PURCHASE AGREEMENT, dated as of February 23, 1998 (the
"Agreement"), among BOOTH CREEK SKI HOLDINGS, INC., a Delaware corporation (the
"Company"), the Guarantors (as defined herein) and CIBC XXXXXXXXXXX CORP. (the
"Initial Purchaser").
In consideration of the mutual covenants and agreements set forth herein
and for good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"Accredited Investor" has the meaning provided therefor in Section 3.2 of
this Agreement.
"Act" means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder.
"Affiliate" means, with respect to any Person, any other Person which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, the Person in question. For
purposes of this definition, "control" (including, with correlative meanings,
the terms "controlling", "controlled by" and "under common control with"), as
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities, by agreement
or otherwise; provided, however, that beneficial ownership of at least 10% of
the voting securities of a Person shall be deemed to be control.
"Agreement" means this Agreement, as the same may be amended, supplemented
or modified in accordance with the terms hereof.
"Basic Documents" means, collectively, the Indenture, the Notes, the
Guarantee, the Registration Rights Agreement and this Agreement.
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"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in the City of New York are
authorized or obligated by law to close.
"Capital Stock" of any Person means any and all shares, interests or other
participations in, and other equivalents (however designated and whether voting
or non-voting) of such Person's equity, including membership interests or units
in a limited liability company, and includes, without limitation, all series
and classes of such equity.
"Closing" has the meaning provided therefor in Section 2.2 of this
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission or any similar
agency then having jurisdiction to enforce the Act.
"Default" means any event, act or condition which, with notice or lapse of
time or both, would constitute an Event of Default.
"Effective Time" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Environmental Claim" means any written allegation, notice of violation,
claim, demand, abatement order or other order by any Tribunal or any Person for
any response or corrective action, any damage, including, without limitation,
personal injury (including sickness, disease or death), property damage,
contribution, indemnity, indirect or consequential damages, damage to the
environment, nuisance, pollution, contamination or other adverse effects on the
environment, or for fines, penalties or restrictions, in each case arising
under any Environmental Law, including without limitation, relating to,
resulting from or in connection with Hazardous Materials and relating to the
Company, any Subsidiaries of the Company or any Facilities.
"Environmental Laws" means the common law and all statutes, ordinances,
orders, rules, regulations or decrees relating to (i) fines, injunctions,
penalties, damages, contribution, cost recovery compensation, losses or
injuries resulting from the Release or threatened Release of Hazardous
Materials,
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(ii) the generation, use, storage, treatment, transportation or disposal of
Hazardous Materials, or (iii) pollution or protection of human health, safety
or the environment, including without limitation, ambient air, indoor air,
soil, surface water, ground water, land, or subsurface strata, including,
without limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9601 et seq.), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801 et seq.), the Resource Conservation
and Recovery Act (42 U.S.C. Section 6901 et seq.), the Federal Water Pollution
Control Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act (42 U.S.C.
Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. Section
2601 et seq.), the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C.
Section 136 et seq.), the Occupational Safety and Health Act (29 U.S.C.
Section 651 et seq.) and the Emergency Planning and Community Right-to-Know
Act (42 U.S.C. Section 11001 et seq.), each as amended or supplemented, and
any analogous present statutes and regulations promulgated pursuant thereto,
each as in effect as of the date of determination, provided, however, that as
used in Section 3.1(y), the term "Environmental Laws" means, Environmental Laws
in effect on the Closing Date.
"Environmental Lien" means a Lien in favor of a Tribunal or other Person
(i) for any liability under an Environmental Law or (ii) for damages arising
from or costs incurred by such Tribunal or other Person in response to a
Release or threatened Release of any Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" means any event defined as an Event of Default in the
Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission thereunder.
"Exchange Notes" has the meaning provided therefor in the Registration
Rights Agreement.
"Facilities" means any and all real property (including without
limitation, all buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by any of the Company
or Subsidiaries of the Company or any of their respective predecessors in
interest.
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"Final Memorandum" has the meaning provided therefor in Section 2.1 of
this Agreement.
"Guarantee" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Guarantors" means 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 and Targhee Ski Corp. and, at
the Effective Time, also means LMRC Holding Corp., Loon Mountain Recreation
Corporation and Loon Realty Corp. References herein to the Guarantors or a
Guarantor shall not, however, include the Loon Entities prior to the Effective
Time.
"Hazardous Materials" means any pollutant, contaminant, toxic, hazardous
or extremely hazardous substance, constituent or waste, or any other
constituent, waste, material, compound or substance including, without
limitation, petroleum including crude oil or any fraction thereof, or any
petroleum product, subject to regulation under any Environmental Law.
"Indemnified Party" has the meaning provided therefor in Section 7.1(c) of
this Agreement.
"Indemnifying Party" has the meaning provided therefor in Section 7.1(c)
of this Agreement.
"Indenture" means the indenture dated as of March 18, 1997, as amended by
Supplemental Indenture No. 1 dated as of April 25, 1997, Supplemental Indenture
No. 2 dated as of February 20, 1998 and Supplemental Indenture No. 3 to be
dated as of the date of Closing, among the Company, the Guarantors and the
Trustee, under which the Notes will be issued.
"Initial Purchaser" has the meaning set forth in the introductory
paragraph to this Agreement.
"Lien" means, with respect to any property or assets of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance,
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such property or assets
(including without limitation, any Capitalized Lease Obligations (as defined in
the Indenture)), conditional sales,
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or other title retention agreement having substantially the same economic
effect as any of the foregoing.
"LMRC" has the meaning provided therefor in Section 2.1 of this Agreement.
"Loon Entities" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Loon Mountain" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Loon Mountain Acquisition" has the meaning provided therefor in the Final
Memorandum.
"Loon Realty" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Material Adverse Effect" means, with respect to the Company, its
Subsidiaries and the Loon Entities, a material adverse effect on the business,
condition (financial or otherwise), results of operations or prospects of the
Company, its Subsidiaries and the Loon Entities, taken as a whole; provided
that, with respect to the Company and the Guarantors, "Material Adverse Effect"
shall also mean a material adverse effect on the ability of the Company and the
Guarantors to perform their respective obligations under this Agreement or the
other Basic Documents.
"Memorandum" has the meaning provided therefor in Section 2.1 of this
Agreement.
"Notes" means the 12 1/2% Series C Senior Notes due 2007 of the Company.
"Offering" has the meaning assigned thereto in the Memorandum.
"Offering Materials" has the meaning provided therefor in Section 7.1 of
this Agreement.
"Permits" means certificates, permits, licenses, franchises, consents,
approvals, authorizations and clearances that are material to the condition
(financial or otherwise), business or operations of the Company, the
Subsidiaries of the Company and the Loon Entities, taken as a whole.
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"Person" means any individual, corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint-stock company,
government (or an agency or political subdivision thereof) or other entity of
any kind.
"PORTAL" means the Private Offering, Resales, and Trading through
Automated Linkages Market.
"Preliminary Memorandum" has the meaning provided therefor in Section 2.1
of this Agreement.
"Private Exchange Notes" shall have the meaning provided therefor in the
Registration Rights Agreement.
"Proceeding" has the meaning provided therefor in Section 7.1(c) of this
Agreement.
"QIB" has the meaning provided therefor in Section 3.2 of this Agreement.
"Real Property Assets" means interests in land, buildings, improvements
and fixtures attached thereto or used in the operation thereof, in each case
owned or leased (as lessee) by the Company, Subsidiaries of the Company or the
Loon Entities and, as used in Section 3.1(y), including land, buildings,
improvements and fixtures operated by the Company, Subsidiaries of the Company
or the Loon Entities.
"Registration Rights Agreement" means the registration rights agreement
among the Company, the Guarantors and the Initial Purchaser relating to the
Notes.
"Release" means any spill, emission, leaking, pumping, pouring, injection,
escaping, deposit, disposal, discharge, dumping, leaching or migration of
Hazardous Materials (including, without limitation, the abandonment or disposal
of any barrels, containers or other closed receptacles containing any Hazardous
Materials.
"Senior Credit Facility" has the meaning provided therefor in the
Indenture.
"State" means each of the states of the United States, the District of
Columbia and the Commonwealth of Puerto Rico.
"State Commission" means any agency of any State having jurisdiction to
enforce such State's securities laws.
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"Subsidiaries" means, with respect to any Person, any corporation,
partnership, joint venture, association or other business entity,
whether now existing or hereafter organized or acquired, (i) in the case of a
corporation, of which more than 50% of the total voting power of the capital
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, officers or trustees thereof is held by such
first-named Person or any of its Subsidiaries; or (ii) in the case of a
partnership, limited liability company, joint venture, association or other
business entity, with respect to which such first-named Person or any of its
Subsidiaries has the power to direct or cause the direction of the management
and policies of such entity by contract or otherwise or if in accordance with
generally accepted accounting principles such entity is consolidated with the
first-named Person for financial statement purposes. When used in any
representation, warranty or covenant contained herein, the terms "Subsidiaries"
or "Subsidiary" shall mean Subsidiaries or a Subsidiary of a Person at the time
such representation, warranty or covenant is made or deemed made.
"Taxes" has the meaning provided therefor in Section 3.1(v) of this
Agreement.
"Time of Purchase" has the meaning provided therefor in Section 2.2 of
this Agreement.
"Transaction Documents" means the material documents entered into by the
Company or any of its Subsidiaries in connection with the Transactions.
"Transactions" has the meaning provided therefor in the Final Memorandum.
"Tribunal" means any government, any arbitration panel, any court or any
governmental department, commission, board, bureau, agency authority or
instrumentality of the United States of America or any state, province,
commonwealth, nation, territory, possession, county, parish, town, township,
village or municipality, whether now or hereafter constituted and/or existing.
"Trustee" means Marine Midland Bank, as trustee under the Indenture.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and the rules and regulations of the Commission thereunder.
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Section 1.2. Accounting Terms; Financial Statements. All accounting
terms used herein not expressly defined in this Agreement shall have the
respective meanings given to them in accordance with sound accounting practice.
The term "sound accounting practice" shall mean such accounting practice as,
in the opinion of the independent accountants regularly retained by the
Company, conforms at the time to generally accepted accounting principles in
the United States applied on a consistent basis except for changes which such
accountants believe are reasonable. All determinations to which accounting
principles apply shall be made in accordance with sound accounting practice.
ARTICLE II
ISSUE OF NOTES; PURCHASE AND SALE
OF NOTES; RIGHTS OF HOLDERS OF NOTES;
OFFERING BY INITIAL PURCHASER
Section 2.1. Issue of Notes. The Company has authorized the issuance of
$17,500,000 aggregate principal amount of the Notes which are to be issued
pursuant to the Indenture. Each Note will be substantially in the form of the
Note set forth as Exhibit A to the Indenture. The Notes will be
unconditionally guaranteed, on a senior basis, as to payment of principal,
premium, if any, and interest, jointly and severally, by the Guarantors (the
"Guarantee"). Each Guarantee will be substantially in the form of the
Guarantee set forth as Exhibit G to the Indenture.
The Notes will be offered and sold to the Initial Purchaser without being
registered under the Act, in reliance on exemptions therefrom.
In connection with the sale of the Notes, the Company and the Guarantors
have prepared a preliminary offering memorandum dated February 16, 1998 (the
"Preliminary Memorandum") and prepared a final offering memorandum dated
February 23, 1998 (the "Final Memorandum" and, together with the Preliminary
Memorandum, the "Memorandum") setting forth or including a description of the
terms of the Notes and the Guarantees, the terms of the Offering, a description
of the Company and the Guarantors and LMRC Holding Corp. ("LMRC"), Loon
Mountain Recreation Corporation ("Loon Mountain") and Loon Realty Corp. ("Loon
Realty" and, together with LMRC and Loon Mountain, the "Loon Entities") and any
material developments relating to the
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Company, the Guarantors and the Loon Entities occurring after the date of the
most recent financial statements included therein.
At the time the Loon Mountain Acquisition is consummated (the "Effective
Time"), which shall occur simultaneously with the consummation of the sale of
the Notes, each of the Loon Entities shall become a direct or indirect wholly
owned subsidiary of the Company and at the Effective Time will execute and
deliver this Agreement and the Guarantee and become subject to all of the
provisions of this Agreement and the Guarantee as a Guarantor. References
herein to the Guarantors or a Guarantor shall not, however, include the Loon
Entities prior to the Effective Time.
Section 2.2. Purchase, Sale and Delivery of Notes. On the basis of the
representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees that
it will sell to the Initial Purchaser, and the Initial Purchaser agrees that it
will purchase from the Company at the Time of Purchase, $17,500,000 aggregate
principal amount of the Notes at a price equal to 97% of the principal amount
thereof.
The purchase, sale and delivery of the Notes will take place at a closing
(the "Closing") at the offices of Winston & Xxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx, at 10:00 A.M., New York time, on February 26, 1998, or such later
date and time, if any, as the Initial Purchaser and the Company shall agree.
The time at which such Closing is concluded is herein called the "Time of
Purchase."
One or more certificates in definitive form for the Notes that the Initial
Purchaser has agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the Initial Purchaser
requests upon notice to the Company at least 36 hours prior to the Closing,
shall be delivered by or on behalf of the Company to the Initial Purchaser,
against payment by or on behalf of the Initial Purchaser of the purchase price
therefor by wire transfer of immediately available funds wired in accordance
with the written instructions of the Company. The Company will make such
certificate or certificates for the Notes available for checking and packaging
by the Initial Purchaser at the offices of the Initial Purchaser, or such other
place as the Initial Purchaser may designate, at least 24 hours prior to the
Closing.
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Section 2.3. Registration Rights of Holders of Notes. The Initial
Purchaser and its direct and indirect transferees of the Notes will have such
rights with respect to the registration thereof under the Act and
qualification of the Indenture under the Trust Indenture Act as are set forth
in the Registration Rights Agreement.
Section 2.4. Offering by the Initial Purchaser. The Initial Purchaser
proposes to make an offering of the Notes at the price and upon the terms set
forth in the Final Memorandum, as soon as practicable after this Agreement is
entered into and as in the judgment of the Initial Purchaser is advisable.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of the Company and the
Guarantors. The Company and the Guarantors, jointly and severally, represent
and warrant to and agree with the Initial Purchaser as follows:
(a) The Final Memorandum, as of its date and at the Time of
Purchase, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this Section 3.1(a) do not apply to statements or omissions made in
reliance upon and in conformity with information relating to the Initial
Purchaser furnished to the Company in writing by the Initial Purchaser
expressly for use in the Final Memorandum or any amendment or supplement
thereto as set forth in Section 8.4 hereof.
(b) The audited financial statements of each of the Company; the
Resort Group of Fibreboard Corporation; Waterville Valley Ski Area Ltd.
(a subsidiary of American Skiing Company); Waterville Valley Ski Area
Ltd. (a subsidiary of S.K.I. Limited); Ski Lifts, Inc.; Grand Targhee
Incorporated (collectively, the "Audited Entities"); and Loon Mountain,
together with related notes, set forth in the Final Memorandum fairly
present the financial condition, results of operations and cash flows of
the Audited Entities and, to the best knowledge of the Company, after due
inquiry, of Loon Mountain, as of the dates indicated
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and for the periods to which they relate and have been prepared in
accordance with generally accepted accounting principles consistently
applied throughout, except as otherwise stated therein; to the best
knowledge of the Company, after due inquiry, the interim unaudited
financial statements of Loon Mountain included in the Final Memorandum
present fairly the financial condition, results of operations and cash
flows of Loon Mountain at the dates and for the periods to which they
relate subject to year-end audit adjustments and have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis with the audited financial statements of Loon Mountain
included therein (except that the interim financial statements have more
limited footnote disclosure); the summary and selected financial data in
the Final Memorandum present fairly the financial information shown
therein and have been prepared and compiled on a basis consistent with
audited financial statements included therein, except as otherwise stated
therein; and the pro forma financial information and the related notes
thereto included in the Final Memorandum have been prepared using
reasonable assumptions and (except with respect to the unaudited adjusted
pro forma financial data and note (m) to the unaudited pro forma
condensed consolidated statement of operations, which each includes
supplemental adjustments not provided for under the Act, but which are
appropriate to give effect to the transactions or circumstances referred
to therein) have been prepared in accordance with the applicable
requirements of the Act and include all adjustments necessary to present
fairly the pro forma financial information included in the Final
Memorandum at the respective dates and for the respective periods
indicated. Ernst & Young LLP, Xxxxxx Xxxxxxxx LLP, Coopers & Xxxxxxx
LLP, Xxxxxxxx & Associates, P.C. and Price Waterhouse LLP (collectively,
the "Independent Accountants"), which have reported upon the audited
financial statements included in the Memorandum, are independent public
accounting firms as required by the Act and the rules and regulations
thereunder. Neither the Company nor any of the Guarantors has been
notified by any of the Independent Accountants who provided comfort
letters in connection with the Company's March 1997 offering of 12 1/2%
Senior Notes due 2007 that there were any untrue statements in such
comfort letters or in the financial statements which are the subject of
such comfort letters.
(c) The Company and each Subsidiary, and to the best knowledge of
the Company, after due inquiry, each of the
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Loon Entities, is a corporation duly organized, validly existing and
in good standing under the laws of its respective jurisdiction of
organization. The Company and each Subsidiary, and to the best knowledge
of the Company, after due inquiry, each of the Loon Entities, has all
requisite corporate power and authority to own its properties and conduct
its business as now conducted and as described in the Final Memorandum.
Each of the Company and its Subsidiaries, and to the best knowledge of
the Company, after due inquiry, each of the Loon Entities, is duly
qualified and in good standing as a foreign corporation and is authorized
to do business, in each jurisdiction in which the ownership or leasing of
any property or the character of its operations makes such qualification
necessary and in which the failure so to qualify would reasonably be
expected to have a Material Adverse Effect.
(d) As of the Time of Purchase (after giving pro forma effect to
the Transactions), the Company will have the authorized, issued and
outstanding capitalization as set forth in the Final Memorandum. All of
the issued and outstanding shares of Capital Stock of the Company and its
Subsidiaries and, to the best knowledge of the Company, after due
inquiry, each of the Loon Entities are validly issued, fully paid and
nonassessable and were not issued in violation of any preemptive or
similar rights. Except for the Real Estate LLC (as defined in the
Memorandum), the Company has no subsidiaries other than the Guarantors.
Except as set forth in the Final Memorandum and other than with respect
to the Real Estate LLC and matters which are immaterial, (i) all of the
outstanding shares of Capital Stock of the Company and each of its
Subsidiaries and, to the best knowledge of the Company, after due
inquiry, each of the Loon Entities will be free and clear of all liens,
encumbrances, equities and claims or restrictions on transferability
(other than those imposed by the Act and the securities or "Blue Sky"
laws of certain jurisdictions), (ii) there are no outstanding
subscriptions, options, warrants, rights, convertible securities or other
binding agreements or commitments of any character obligating the Company
or its Subsidiaries or, to the best knowledge of the Company, after due
inquiry, any of the Loon Entities to issue any securities and (iii) there
is no agreement, understanding or arrangement among the Company or its
Subsidiaries or, to the best knowledge of the Company, after due inquiry,
any of the Loon Entities and their respective securityholders or any
other Person relating to the ownership or disposition of any Capital
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Stock in the Company or its Subsidiaries or, to the best knowledge of
the Company, after due inquiry, any of the Loon Entities, the election of
directors of the Company or any of its Subsidiaries or, to the best
knowledge of the Company, after due inquiry, any of the Loon Entities or
the governance of the affairs of the Company or any of its Subsidiaries
or, to the best knowledge of the Company, after due inquiry, any of the
Loon Entities, and such agreements, arrangements or understandings will
not be breached or violated as a result of the execution and delivery of,
or the consummation of the transactions contemplated by, this Agreement
and the Basic Documents.
(e) This Agreement has been duly authorized, executed and delivered
by the Company and each of the Guarantors and (assuming the due
authorization, execution and delivery by the Initial Purchaser) is a
valid and legally binding agreement of the Company and each of the
Guarantors, enforceable against each of them in accordance with its terms
except (i) that the enforcement hereof may be subject to bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and to general principles of equity and the discretion of the
court before which any proceeding therefor may be brought and (ii) as any
rights to indemnity or contribution hereunder may be limited by federal
and state securities laws and public policy considerations.
(f) The Indenture has been duly authorized, executed and delivered
by the Company and each of the Guarantors (assuming the due
authorization, execution and delivery by the Trustee), and constitutes a
valid and legally binding agreement of the Company and each of the
Guarantors, enforceable against each of them in accordance with its terms
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity and the discretion of the
court before which any proceeding therefor may be brought.
(g) The Registration Rights Agreement has been duly authorized by
the Company and the Guarantors and, when executed and delivered by the
Company and each of the Guarantors (assuming the due authorization,
execution and delivery by the Initial Purchaser), will constitute a
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valid and legally binding agreement of the Company and each of the
Guarantors, enforceable against each of them in accordance with its terms
except (i) that the enforcement thereof may be subject to bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and to general principles of equity and the discretion of the
court before which any proceeding therefor may be brought and (ii) as any
rights to indemnity or contribution thereunder may be limited by federal
and state securities laws and public policy considerations.
(h) The Notes, the Exchange Notes and the Private Exchange Notes
have each been duly authorized by the Company and, when executed by the
Company and authenticated by the Trustee in accordance with the
provisions of the Indenture and, in the case of the Notes, delivered to
and paid for by the Initial Purchaser in accordance with the terms of
this Agreement, will be entitled to the benefits of the Indenture and
will constitute valid and legally binding obligations of the Company
enforceable in accordance with their terms, except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally, and (ii) general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought.
(i) The Guarantees endorsed on the Notes and the guarantees to be
endorsed on the Exchange Notes and the Private Exchange Notes have each
been duly authorized by the Guarantors and, when the Notes are executed
by the Company and the Guarantees are endorsed by the Guarantors and the
Notes are authenticated by the Trustee in accordance with the provisions
of the Indenture and delivered to and paid for by the Initial Purchaser
in accordance with the terms of this Agreement, the Guarantees will be
entitled to the benefits of the Indenture and will constitute valid and
legally binding obligations of the Guarantors enforceable in accordance
with their terms, except that the enforcement thereof may be subject to
(i) bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (ii) general principles of equity and
the discretion of
18
-15-
the court before which any proceeding therefor may be brought.
(j) Immediately after the consummation of the transactions
contemplated by this Agreement (including the use of proceeds from the
sale of Notes at the Time of Purchase), the fair value and present fair
saleable value of the assets of the Company (on a consolidated basis)
will exceed the sum of its stated liabilities and identified contingent
liabilities; the Company (on a consolidated basis) will not be, after
giving effect to the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby
(including the use of proceeds from the sale of Notes at the Time of
Purchase), (i) left with unreasonably small capital with which to carry
on its business as it is proposed to be conducted, (ii) unable to pay its
debts (contingent or otherwise) as they mature or (iii) otherwise
insolvent.
(k) Each of the Company and the Guarantors (to the extent a party
thereto) has all requisite corporate power and authority to (i) execute,
deliver and perform its obligations under this Agreement and each of the
other Basic Documents, (ii) execute, deliver and perform its obligations
under all other agreements and instruments executed and delivered by the
Company and the Guarantors pursuant to or in connection with this
Agreement and each of the other Basic Documents, (iii) issue the Notes
and the Guarantee, as the case may be, in the manner and for the purpose
contemplated by this Agreement and (iv) consummate each of the
transactions contemplated hereby and thereby.
(l) Subsequent to the date as of which financial information is
given in the Final Memorandum and except as disclosed in the Final
Memorandum there has not been (i) any event or condition that has had or
that could reasonably be expected to have a Material Adverse Effect, (ii)
any transaction entered into by the Company or the Guarantors, or to the
best knowledge of the Company, after due inquiry, any of the Loon
Entities, other than in the ordinary course of business, that is material
to the Company, the Guarantors and the Loon Entities, taken as a whole,
or (iii) any dividend or distribution of any kind declared, paid or made
by the Guarantors or the Company on its common equity other than to the
Company or another Guarantor.
(m) Except as set forth in the Final Memorandum, there is no
action, suit, investigation or proceeding,
19
-16-
governmental or otherwise, pending or, to the best knowledge of the
Company, threatened to which the Company or the Guarantors or to the best
knowledge of the Company, after due inquiry, any of the Loon Entities, is
or would be a party or of which the properties or assets of the Company
or the Guarantors are or may be subject that (i) seeks to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance
and sale of the Notes by the Company or the making of the Guarantee by
the Guarantors or any of the other transactions contemplated hereby, (ii)
questions the legality or validity of any such transactions or seeks to
recover damages or obtain other relief in connection with any such
transactions or (iii) would, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(n) The execution, delivery and performance by the Company and the
Guarantors (to the extent a party thereto) of this Agreement and the
other Basic Documents, and the issuance and sale by the Company of the
Notes, the making of the Guarantees by the Guarantors, and the execution,
delivery and performance by the Company and the Guarantors (to the extent
a party thereto) of all other agreements and instruments to be executed
and delivered by the Company and the Guarantors pursuant hereto or
thereto or in connection herewith or therewith, and compliance by the
Company and the Guarantors (to the extent a party thereto) with the terms
and provisions hereof and thereof, do not and will not (i) (assuming
compliance with all applicable state securities or "Blue Sky" laws and
assuming the accuracy of the representations and warranties of the
Initial Purchaser in Section 3.2 hereof) violate any provision of any
law, rule or regulation (including, without limitation, Regulation G, T,
U or X of the Board of Governors of the Federal Reserve System), order,
writ, judgment, decree, determination or award presently in effect or in
effect at the Time of Purchase having applicability to the Company or the
Guarantors or, to the best knowledge of the Company, after due inquiry,
the Loon Entities, or (ii) conflict with or result in a breach of or
constitute a default under the organizational documents of the Company or
the Guarantors or, to the best knowledge of the Company, after due
inquiry, the Loon Entities, or, as of the Time of Purchase, any indenture
or loan or credit agreement, or any other material agreement or
instrument, to which the Company or the Guarantors or, to the best
knowledge of the Company, after due inquiry, the Loon Entities, is a
party or by which the Company or the Guaran-
20
-17-
tors or, to the best knowledge of the Company, after due inquiry, the
Loon Entities, or any of their respective properties or assets may be
bound or affected, or (iii) except as contemplated by this Agreement and
the other Basic Documents or the Memorandum, result in, or require the
creation or imposition of, any Lien upon or with respect to any of the
properties now owned or hereafter acquired by the Company or the
Guarantors or, to the best knowledge of the Company, after due inquiry,
the Loon Entities, except, in the case of clauses (i), (ii) and (iii),
where such violation, conflict, default or creation or imposition of any
Lien would not (individually or in the aggregate) reasonably be expected
to have a Material Adverse Effect.
(o) Each agreement or instrument (other than the Basic Documents)
executed and delivered by the Company or the Guarantors (to the extent a
party thereto) in connection with the Basic Documents has been duly and
validly authorized, executed and delivered by the Company and the
Guarantors (to the extent a party thereto) and constitutes or will
constitute a valid and legally binding obligation of the Company and the
Guarantors (to the extent a party thereto), enforceable against them in
accordance with its terms, except (i) that the enforcement thereof may be
subject to bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and to general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought and (ii) as any rights to indemnity and contribution hereunder
and thereunder may be limited by applicable law.
(p) None of the Company or the Guarantors or, to the best knowledge
of the Company, after due inquiry, the Loon Entities is currently or,
after giving effect to the consummation of the transactions contemplated
by this Agreement and the Basic Documents, will be (i) in violation of
its respective organizational documents, (ii) in default (nor will an
event occur which with notice or passage of time or both would constitute
such a default) under or in violation of any indenture or loan or credit
agreement or any other material agreement or instrument to which it is a
party or by which it or any of its properties or assets may be bound or
affected (except as set forth in the Final Memorandum), (iii) in
violation of any order of any court, arbitrator or governmental body or
(iv) in violation of or
21
-18-
will have violated any statute, rule or regulation of any governmental
authority, which default or violation (individually or in the aggregate)
would reasonably be expected to (x) affect the legality, validity or
enforceability of this Agreement or any of the other Basic Documents or
(y) have a Material Adverse Effect.
(q) Except as set forth in the Final Memorandum, no authorization,
consent, approval, license, qualification or formal exemption from, nor
any filing, declaration or registration with, any court, governmental
agency or regulatory authority or any securities exchange is required in
connection with the execution, delivery or performance by the Company or
the Guarantors of this Agreement, or any of the other Basic Documents or
any of the transactions contemplated thereby, except (i) as may be
required under state securities or "blue sky" laws or the laws of any
foreign jurisdiction in connection with the offer and sale of the Notes
or (ii) as would not (individually or in the aggregate) reasonably be
expected to have a Material Adverse Effect. All such authorizations,
consents, approvals, licenses, qualifications, exemptions, filings,
declarations and registrations set forth in the Final Memorandum (other
than as disclosed therein) which are required to have been obtained by
the date hereof have been obtained or made, as the case may be, and are
in full force and effect and not the subject of any pending or, to the
knowledge of the Company, threatened attack by appeal or direct
proceeding or otherwise.
(r) None of the Company or any of the Guarantors or, to the best
knowledge of the Company, after due inquiry, any of the Loon Entities is,
or immediately after the Time of Purchase will be, an "investment
company" or a "promoter" or "principal underwriter" for an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
(s) The execution and delivery of this Agreement and the other
Basic Documents and the sale of the Notes to the Initial Purchaser will
not involve any non-exempt prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code on the part of the
Company or any of its Subsidiaries or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities. No Reportable
Event (as defined in Section 4043 of ERISA) has occurred during the
five-year period prior to the date on which this representation is made
or deemed
22
-19-
made with respect to any Employee Benefit Plan (as defined below), and
the Company and each of its Subsidiaries and, to the best knowledge of
the Company, after due inquiry, each of the Loon Entities, and Commonly
Controlled Entities (as defined below) have complied in all material
respects with the applicable provisions of ERISA and the Code in
connection with the Employee Benefit Plans (as defined below). The
present value of all accrued benefits under each Employee Benefit Plan
subject to Title IV of ERISA (based on the current liability, interest
rate and other assumptions used in preparation of the plan's Form 5500
Annual Report) did not, as of the last annual valuation date prior to the
date on which this representation is made or deemed made, exceed the
value of the assets of such plan allocable to such accrued benefits.
Neither the Company, any of its Subsidiaries or, to the best knowledge of
the Company, after due inquiry, any of the Loon Entities nor any Commonly
Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan (as defined in Section 4001(a)(3) of ERISA), and
neither the Company, any of its Subsidiaries or, to the best knowledge of
the Company, after due inquiry, any of the Loon Entities, nor any
Commonly Controlled Entity would become subject to any liability under
ERISA if the Company, any of its Subsidiaries, any of the Loon Entities
or any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation date most closely preceding
the date on which such representation is made or deemed made. No such
Multiemployer Plan is in reorganization or insolvent. There are no
material liabilities of the Company, any of its Subsidiaries or, to the
best knowledge of the Company, after due inquiry, any of the Loon
Entities, or any Commonly Controlled Entity for post-retirement benefits
to be provided to their current and former employees under Plans which
are welfare benefit plans (as described in Section 3(1) of ERISA). With
respect to each Employee Benefit Plan, no event has occurred and there
exists no condition or set of circumstances in connection with which the
Company or any of its Subsidiaries or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities may, directly or
indirectly (though a Commonly Controlled Entity or otherwise), be subject
to material liability under the Code, ERISA or any other applicable law,
except for liability for benefit claims and funding obligations payable
in the ordinary course. "Commonly Controlled Entity" shall mean any
person or entity that, together with the Company, any Subsidiary of the
Company or any of the Loon Entities, is
23
-20-
treated as a single employer under Section 414(b), (c), (m) or (o) of
the Code. "Employee Benefit Plan" shall mean an employee benefit plan,
as defined in Section 3(3) of ERISA, which is maintained or contributed
to by the Company, any of its Subsidiaries, any of the Loon Entities or
any Commonly Controlled Entity or to which the Company, any of its
Subsidiaries, any of the Loon Entities or any Commonly Controlled Entity
may have liability for which the Company and its Subsidiaries or the Loon
Entities are not fully indemnified.
(t) The Company, each of its Subsidiaries and, to the best
knowledge of the Company, after due inquiry, each of the Loon Entities
has good and valid title to, or valid and enforceable leasehold interests
in, all properties and assets identified in the Final Memorandum as owned
or leased, respectively, by it free and clear of all Liens, except (i) to
the extent the failure to have such title or the existence of such Liens,
individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect, (ii) such Liens as are described in the
Final Memorandum or (iii) Liens created in the ordinary course of
business which are Permitted Liens (as defined in the Indenture). All of
the leases material to the business of the Company, each of its
Subsidiaries and, to the best knowledge of the Company, after due
inquiry, each of the Loon Entities and under which the Company, each of
its Subsidiaries and, to the best knowledge of the Company, after due
inquiry, each of the Loon Entities holds properties described in the
Final Memorandum, are valid and binding as leased by them, with such
exceptions as, individually and in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.
(u) No form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) was used by the
Company or the Guarantors or their agents in connection with the offer
and sale of the Notes. None of the Company or the Guarantors or any
Person authorized to act for any of them has, either directly or
indirectly, sold or offered for sale any of the Notes or any other
similar security (other than the 12 1/2% Series A Senior Notes due 2007
and the 12 1/2% Series B Senior Notes due 2007 previously issued pursuant
to the Indenture) of the Company to, or solicited any offers to buy any
thereof from, or has otherwise approached or negotiated in respect
thereof with, any Person or Persons other than with or through the
Initial Purchaser; and the Com-
24
-21-
pany and the Guarantors agree that neither they nor any Person acting
on their behalf will sell or offer for sale any Notes to, or solicit any
offers to buy any Notes from, or otherwise approach or negotiate in
respect thereof with, any Person or Persons so as thereby to bring the
issuance or sale of any of the Notes within the provisions of Section 5
of the Act.
(v) All tax returns required to be filed by each of the Company and
its Subsidiaries and, to the best knowledge of the Company, after due
inquiry, each of the Loon Entities in any jurisdiction (including foreign
jurisdictions) have been duly filed and all taxes, assessments, fees and
other charges including, without limitation, withholding taxes,
penalties, and interest ("Taxes") due or claimed to be due have been
paid, other than those Taxes being contested in good faith and those
Taxes for which adequate reserves or accruals have been established in
accordance with generally accepted accounting principles, except where
the failure to file such returns or to pay such Taxes would not
reasonably be expected to have, singly or in the aggregate, a Material
Adverse Effect. The Company knows of no actual or proposed additional
tax assessments for any fiscal period prior to the date hereof against
the Company or any of its Subsidiaries or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities that, individually
or in the aggregate, is reasonably likely to have a Material Adverse
Effect.
(w) The Company and each of its Subsidiaries and, to the best
knowledge of the Company, after due inquiry, each of the Loon Entities
owns or possesses adequate licenses or other rights to use all trade
names, unregistered trademarks and service marks, brand names, patents,
registered and unregistered copyrights, registered trademarks and service
marks, and all applications for any of the foregoing, and all permits,
grants and licenses or other rights with respect thereto, the absence of
which (individually or in the aggregate) would have or could reasonably
be expected to have a Material Adverse Effect. Except as set forth in
the Final Memorandum, neither the Company, any of its Subsidiaries nor,
to the best knowledge of the Company, after due inquiry, any of the Loon
Entities has been charged with any material infringement of any
intangible property of the character described above or been notified or
advised of any material claim of any other Person relating to any of the
intangible prop-
25
-22-
erty which infringements or claims (individually or in the aggregate)
would have a Material Adverse Effect.
(x) Except as set forth in the Final Memorandum, each of the
Company and its Subsidiaries and, to the best knowledge of the Company,
after due inquiry, each of the Loon Entities is in compliance with all,
and has no liability under any, laws, rules and regulations (including,
without limitation, all applicable Environmental Laws, rules and
regulations) applicable to the Company, any of its Subsidiaries or any of
the Loon Entities, and the Company, each of its Subsidiaries and, to the
best knowledge of the Company, after due inquiry, each of the Loon
Entities owns or possesses and is operating in compliance in all material
respects with the terms, provisions, conditions, restrictions and
limitations contained in all licenses, franchises, approvals,
certificates and permits (including, without limitation, environmental
permits) from all Federal, state, territorial, foreign and local
governmental and regulatory authorities which are necessary to own or
lease their respective properties and assets and to the conduct of their
respective businesses (other than where the failure to be in compliance
with or liability under such laws, rules, regulations, licenses,
franchises, approvals, certificates or permits would not reasonably be
expected to have a Material Adverse Effect). Except as described in the
Final Memorandum, there are no citations or notices of forfeiture or
other proceedings pending or, to the best knowledge of the Company,
threatened against the Company or any of its Subsidiaries or, to the best
knowledge of the Company, after due inquiry, any of the Loon Entities or
any basis therefor which would lead to the revocation, termination,
suspension or non-renewal of any such license, franchise, approval,
certificate or permit except where all such revocations, terminations,
suspensions or non-renewals, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect. Other than as
disclosed in the Final Memorandum, (i) there are no license renewal or
rate or tariff proceedings existing, pending or, to the best knowledge of
the Company, threatened against the Company or the Guarantors or, to the
best knowledge of the Company, after due inquiry, the Loon Entities that
would have a Material Adverse Effect, and (ii) there are no restrictions
or limitations contained in any applicable license, franchise, approval,
certificate or permit of the Company, any of its Subsidiaries or, to the
best knowledge of the Company, after due inquiry, any of the Loon
Entities, or,
26
-23-
to the best knowledge of the Company, threatened or proposed in any
pending or contemplated hearing, proceeding or procedure, that would have
a Material Adverse Effect.
(y) Except as set forth in the Final Memorandum,
(1) none of the Company or any Subsidiaries of the Company or,
to the best knowledge of the Company, after due inquiry, any of the
Loon Entities has received (a) any written notice or claim to the
effect that it is or may be liable to any Person under any
Environmental Law, except as would not reasonably be expected to
have a Material Adverse Effect or (b) any written notice of
potential liability or request for information under the
Comprehensive Environmental Response, Compensation, and Liability
Act of 1980, as amended or any comparable state laws regarding any
matter except as would not reasonably be expected to have a
Material Adverse Effect, and none of the Company or any
Subsidiaries of the Company or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities, is presently
involved in any investigation, response or corrective action
relating to or in connection with any Hazardous Materials at any
location except for such of the foregoing which would not
reasonably be expected to have a Material Adverse Effect;
(2) none of the Company or any Subsidiaries of the Company or
any of their Real Property Assets or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities or any of
their Real Property Assets or, to the Company's knowledge, any
Facilities, are subject to any outstanding written order with any
governmental authority or written agreement with any Person
relating to (a) any actual or potential violation of or liability
under Environmental Laws or (b) any Environmental Claims except, in
each case, for such of the foregoing which would not reasonably be
expected to have a Material Adverse Effect;
(3) there are currently no Releases and, to the best knowledge
of the Company and the Guarantors, there have been no Releases of
Hazardous Materials at, on, under or from any of the Real Property
Assets of the Company, any of its Subsidiaries or, to the best
knowledge of the Company, after due inquiry, any
27
-24-
of the Loon Entities in a manner that could reasonably be
expected to give rise to an Environmental Claim except for Releases
which would not reasonably be expected to have a Material Adverse
Effect, and none of the Company, any Subsidiaries of the Company
or, to the best knowledge of the Company, after due inquiry, any of
the Loon Entities has reported a Release of any Hazardous Materials
that could reasonably be expected to give rise to an Environmental
Claim except for Releases which would not reasonably be expected to
have a Material Adverse Effect;
(4) no underground storage tanks or surface impoundments are
on or at any Real Property Assets of the Company, any of its
Subsidiaries or, to the best knowledge of the Company, after due
inquiry, any of the Loon Entities which require response,
corrective or other action under any applicable Environmental Law,
in each case, which would reasonably be expected to have a Material
Adverse Effect;
(5) no Environmental Lien in favor of any Person has been
filed with respect to any Real Property Assets or other assets of
the Company, any Subsidiaries of the Company or, to the best
knowledge of the Company, after due inquiry, any of the Loon
Entities, except for any such Lien which would not reasonably be
expected to have a Material Adverse Effect; and
(6) there have been no past or present events, conditions or
activities which could reasonably be expected to prevent the
Company, any of its Subsidiaries or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities from complying
with, or to give rise to any liability of any of them under, any
applicable Environmental Law which would reasonably be expected to
have a Material Adverse Effect.
(z) The Notes, the Guarantees, the Indenture, and the Registration
Rights Agreement, when executed and delivered, will conform in all
material respects to the descriptions thereof in the Final Memorandum.
(aa) Assuming the accuracy of the Initial Purchaser's
representation and warranties set forth in Section 3.2 hereof, and the
due performance by the Initial Purchaser of the covenants and agreements
set forth in
28
-25-
Section 3.2 hereof, the offer and sale of the Notes to the Initial
Purchaser in the manner contemplated by this Agreement and the Final
Memorandum does not require registration under the Act and the Indenture
does not require qualification under the Trust Indenture Act of 1939, as
amended.
(bb) Except as set forth in the Final Memorandum, there is no
strike, labor dispute, slowdown or work stoppage with the employees of
the Company, any of its Subsidiaries or, to the best knowledge of the
Company, after due inquiry, any of the Loon Entities which is pending or,
to the best knowledge of the Company or any of its Subsidiaries,
threatened, which would, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(cc) Each of the Company, its Subsidiaries and, to the best
knowledge of the Company, after due inquiry, the Loon Entities carries
insurance (including self insurance) in such amounts and covering such
risks as in its reasonable determination is adequate for the conduct of
its business and the value of its properties.
(dd) No securities of the Company or any of its Subsidiaries are of
the same class (within the meaning of Rule 144A under the Act) as the
Notes and listed on a national securities exchange registered under
Section 6 of the Exchange Act, or quoted in a U.S. automated interdealer
quotation system.
(ee) None of the Company, its Subsidiaries or, to the best
knowledge of the Company, after due inquiry, any of the Loon Entities has
taken, nor will any of them take, directly or indirectly, any action
designed to, or that might be reasonably expected to, cause or result in
stabilization or manipulation of the price of the Notes.
(ff) None of the Company, the Guarantors, any of their respective
Affiliates or any person acting on its or their behalf (other than the
Initial Purchaser) has engaged in any directed selling efforts (as that
term is defined in Regulation S under the Act ("Regulation S")) with
respect to the Notes and the Company, the Guarantors and their respective
Affiliates and any person acting on its or their behalf (other than the
Initial Purchaser) have acted in accordance with the offering
restrictions requirements of Regulation S.
29
-26-
(gg) The Company and each of the Guarantors (to the extent a party)
have duly authorized each of the transactions contemplated hereby and by
the Final Memorandum.
(hh) The statistical and market-related data included in the Final
Memorandum are based on or derived from sources which the Company
believes to be reliable and accurate or represents the Company's good
faith estimates that are made on the basis of data derived from such
sources.
(ii) Except as stated in the Final Memorandum, none of the Company
or any of the Guarantors knows of any claims against the Company, any of
the Guarantors or the Loon Entities for services, either in the nature of
a finder's fee or financial advisory fee, with respect to the offering of
the Notes and the transactions contemplated by the Final Memorandum.
(jj) Each of the Company and the Guarantors (to the extent a party
thereto) has the requisite corporate power and authority to execute,
deliver and perform its obligations under the Transaction Documents. The
Transaction Documents have been duly and validly authorized by each of
the Company and the Guarantors to the extent a party thereto and, when
executed and delivered by the Company or any Guarantor will constitute a
valid and legally binding agreement of the Company or such Guarantor,
enforceable against the Company or such Guarantor to the extent a party
thereto in accordance with their terms except (i) that the enforcement
thereof may be subject to bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally, and to general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought and (ii) as any rights to indemnity or
contribution thereunder may be limited by federal and state securities
laws and public policy considerations. Each of the Transaction Documents
conforms in all material respects to the description thereof, if any, in
the Final Memorandum (or, if the Final Memorandum is not in existence,
the most recent Preliminary Memorandum).
(kk) (i) The Company has delivered to the Initial Purchaser a true
and correct copy of each of the Transaction Documents that have been
executed and delivered prior to the date of this Agreement, together with
all schedules
30
-27-
and exhibits thereto, and as of the date hereof there have been no
amendments, alterations, modifications or waivers of any of the
provisions of any of such Transaction Documents; (ii) each other
Transaction Document shall be substantially as described in the Final
Memorandum; and (iii) there exists as of the date hereof (after giving
effect to the transactions contemplated by each of the Transaction
Documents) no event or condition that would constitute a default or an
event of default (in each case as defined in each of the Transaction
Documents) under any of the Transaction Documents that would result in a
Material Adverse Effect or materially adversely affect the ability of the
Company to consummate the Transactions.
Section 3.2. Resale of Notes. The Initial Purchaser represents and
warrants that it is a "qualified institutional buyer" as defined in Rule 144A
of the Act ("QIB"). The Initial Purchaser agrees with the Company and each of
the Guarantors that (a) it has not and will not solicit offers for, or offer or
sell, the Notes by any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) or in any manner involving
a public offering within the meaning of Section 4(2) of the Act; and (b) it has
and will solicit offers for the Notes only from, and will offer the Notes only
to (A) in the case of offers inside the United States, Persons whom the Initial
Purchaser reasonably believes to be QIBs or, if any such Person is buying for
one or more institutional accounts for which such Person is acting as fiduciary
or agent, only when such Person has represented to the Initial Purchaser that
each such account is a QIB, to whom notice has been given that such sale or
delivery is being made in reliance on Rule 144A, and, in each case, in
transactions under Rule 144A and (B) in the case of offers outside the United
States, to Persons other than U.S. Persons (as such term is defined in
Regulation S under the Act) ("foreign purchasers," which term shall include
dealers or other professional fiduciaries in the United States acting on a
discretionary basis for foreign beneficial owners (other than an estate or
trust)); provided, however, that, in the case of this clause (B), in purchasing
such Notes such Persons are deemed to have represented and agreed as provided
under the caption "Notice to Investors" contained in the Final Memorandum.
31
-28-
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the Initial
Purchaser. The obligation of the Initial Purchaser to purchase the Notes to be
purchased by it hereunder is subject, at the Time of Purchase, to the
satisfaction or waiver of the following conditions:
(a) At the Time of Purchase, the Initial Purchaser shall have
received the opinion, dated as of the Time of Purchase and addressed to
the Initial Purchaser, of Winston & Xxxxxx, counsel for the Company and
the Guarantors in form and substance satisfactory to counsel for the
Initial Purchaser. At the time of Purchase, the Initial Purchaser shall
have received the opinion, dated as of the Time of Purchase and addressed
to the Initial Purchaser, of local counsel for Trimont Land Company and
for Loon Mountain and Loon Realty, in form and substance satisfactory to
counsel for the Initial Purchaser. In addition, the Initial Purchaser
shall have received a letter or letters permitting it to rely on any
opinions rendered by counsel to the Company and/or the Guarantors in
connection with the Transactions.
(b) The Initial Purchaser shall have received an opinion, addressed
to the Initial Purchaser in form and substance satisfactory to the
Initial Purchaser and dated the Time of Purchase, of Xxxxxx Xxxxxx &
Xxxxxxx, counsel to the Initial Purchaser.
(c) The Initial Purchaser shall have received from each of Ernst &
Young LLP and Price Waterhouse LLP a comfort letter or letters dated the
date hereof and the Closing in form and substance reasonably satisfactory
to counsel to the Initial Purchaser.
(d) The representations and warranties made by the Company and the
Guarantors herein shall be true and correct in all material respects
(except for changes expressly provided for in this Agreement) on and as
of the Time of Purchase with the same effect as though such
representations and warranties had been made on and as of the Time of
Purchase, and the Company and the Guarantors shall have complied in all
material respects with all agreements as set forth in or contemplated
hereunder and in the Basic
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Documents required to be performed by the Company and the Guarantors at
or prior to the Time of Purchase.
(e) Subsequent to the date of the Final Memorandum, (i) there shall
not have been any change, or any development involving a prospective
change, which has had or would reasonably be expected to have a Material
Adverse Effect and (ii) the Company and its Subsidiaries shall have
conducted their respective businesses only in the ordinary course except
to the extent contemplated by the Transactions.
(f) At the Time of Purchase and after giving effect to the
consummation of the transactions contemplated by this Agreement and the
Basic Documents, there shall exist no Default or Event of Default.
(g) The purchase of and payment for the Notes by the Initial
Purchaser hereunder shall not be prohibited or enjoined (temporarily or
permanently) by any applicable law or governmental regulation (including,
without limitation, Regulation G, T, U or X of the Board of Governors of
the Federal Reserve System).
(h) At the Time of Purchase, the Initial Purchaser shall have
received a certificate, dated the Time of Purchase, from the Company and
the Guarantors stating that the conditions specified in Sections 4.1(d),
(e), (f) and (g) have been satisfied or duly waived at the Time of
Purchase.
(i) Each of the Basic Documents shall be satisfactory in form and
substance to the Initial Purchaser and shall have been executed and
delivered by all the respective parties thereto and shall be in full
force and effect.
(j) All proceedings taken in connection with the issuance of the
Notes and the transactions contemplated by this Agreement, the other
Basic Documents and all documents and papers relating thereto shall be
reasonably satisfactory to the Initial Purchaser and counsel to the
Initial Purchaser. The Initial Purchaser and counsel to the Initial
Purchaser shall have received copies of such papers and documents as they
may reasonably request in connection therewith, all in form and substance
reasonably satisfactory to them.
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(k) Neither the sale of the Notes hereunder nor any of the other
Transactions shall have been enjoined (temporarily or permanently) at the
Time of Purchase.
(l) Subsequent to the execution and delivery of this Agreement,
there shall not have been any announcement by any "nationally
recognized statistical rating organization," as defined for purposes of
Rule 436(g) under the Act, that (A) it is downgrading its rating assigned
to any debt securities of the Company or any Subsidiary, or (B) it is
reviewing its rating assigned to any debt securities of the Company or
any Subsidiary with a view to possible downgrading, or with negative
implications, or direction not determined.
(m) Each agreement or instrument executed in connection with the
Transactions shall be reasonably satisfactory in form and substance to
the Initial Purchaser and shall have been executed and delivered by all
the respective parties thereto and shall be in full force and effect.
The Transactions shall each have been consummated on or prior to the
Closing Date.
On or before the Closing, the Initial Purchaser and counsel to the Initial
Purchaser shall have received such further documents, opinions, certificates
and schedules or other instruments relating to the business, corporate, legal
and financial affairs of the Company and its Subsidiaries as they may
reasonably request.
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the Guarantors. The
Company and the Guarantors, jointly and severally, covenant and agree with
the Initial Purchaser that:
(a) None of the Company or any of the Guarantors will amend or
supplement the Final Memorandum or any amendment or supplement thereto of
which the Initial Purchaser shall not previously have been advised and
furnished a copy for a reasonable period of time prior to the proposed
amendment or supplement and as to which the Initial Purchaser shall not
have given its consent, which consent shall not be unreasonably withheld.
The Company
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and the Guarantors will promptly, upon the reasonable request of the
Initial Purchaser or counsel to the Initial Purchaser, make any
amendments or supplements to the Preliminary Memorandum or the Final
Memorandum that may be necessary or advisable in connection with the
resale of the Notes by the Initial Purchaser.
(b) The Company and the Guarantors will cooperate with the Initial
Purchaser in arranging for the qualification of the Notes for offering
and sale under the securities or "Blue Sky" laws of such jurisdictions as
the Initial Purchaser may designate and will continue such qualifications
in effect for as long as may be reasonably necessary to complete the
resale of the Notes; provided, however, that in connection therewith, the
Company and the Guarantors shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction or subject itself to taxation in excess of a nominal dollar
amount in any such jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the distribution by
the Initial Purchaser of the Notes, the Exchange Notes or the Private
Exchange Notes, any event occurs or information becomes known as a result
of which the Final Memorandum as then amended or supplemented would
include any untrue statement of a material fact, or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if for
any other reason it is necessary at any time to amend or supplement the
Final Memorandum to comply with applicable law, the Company and the
Guarantors will promptly notify the Initial Purchaser thereof (who
thereafter will not use such Final Memorandum until appropriately amended
or supplemented) and will prepare, at the expense of the Company and the
Guarantors, an amendment or supplement to the Final Memorandum that
corrects such statement or omission or effects such compliance.
(d) The Company will, without charge, provide to the Initial
Purchaser and to counsel to the Initial Purchaser as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or
supplement thereto as the Initial Purchaser may reasonably request.
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(e) The Company will apply the net proceeds from the sale of the
Notes substantially as set forth under "Use of Proceeds" in the Final
Memorandum.
(f) For and during the period commencing on the date hereof and
ending on the date no Notes are outstanding, the Company will furnish
to the Initial Purchaser copies of all reports and other communications
(financial or otherwise) furnished by the Company to the Trustee or the
holders of the Notes and, promptly after available, copies of any reports
or financial statements furnished to or filed by the Company with the
Commission or any national securities exchange on which any class of
securities of the Company may be listed.
(g) Prior to the Time of Purchase, the Company will furnish to the
Initial Purchaser, as soon as they have been prepared, a copy of any
unaudited interim financial statements of the Company for any period
subsequent to the period covered by the most recent financial statements
appearing in the Final Memorandum.
(h) None of the Company or any of its Affiliates will sell, offer
for sale or solicit offers to buy or otherwise negotiate in respect of
any "security" (as defined in the Act) which could be integrated with the
sale of the Notes in a manner which would require the registration under
the Act of the Notes.
(i) The Company will not, and will not permit any of its
Subsidiaries to, solicit any offer to buy or offer to sell the Notes by
means of any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
(j) For so long as any of the Notes remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Act and not salable in full under Rule 144 under the Act (or any
successor provision), the Company will make available, upon request, to
any seller of such Notes the information specified in Rule 144A(d)(4)
under the Act, unless the Company is then subject to Section 13 or 15(d)
of the Exchange Act.
(k) The Company and the Guarantors will use their best efforts to
(i) permit the Notes to be included for
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quotation on PORTAL and (ii) permit the Notes to be eligible for
clearance and settlement through The Depository Trust Company.
(l) The Company and the Guarantors (to the extent a party thereto)
will use their best efforts to do and perform all things required to be
done and performed by them under this Agreement and the other Basic
Documents prior to or after the Closing and to satisfy all conditions
precedent on their part to the obligations of the Initial Purchaser to
purchase and accept delivery of the Notes.
(m) In connection with Notes offered and sold in an offshore
transaction (as defined in Regulation S) the Company will not register
any transfer of such Notes not made in accordance with the provisions of
Regulation S and will not, except in accordance with the provisions of
Regulation S, if applicable, issue any such Notes in the form of
definitive securities.
ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes. The Company and the
Guarantors, jointly and severally, agree to pay all costs and expenses incident
to the performance of their obligations under this Agreement, whether or not
the transactions contemplated herein are consummated or this Agreement is
terminated pursuant to Section 8.2 hereof, including, but not limited to, all
costs and expenses incident to (i) the negotiation, preparation, printing, word
processing, reproduction, execution and delivery of this Agreement, each of the
Basic Documents, any amendment or supplement to or modification of any of the
foregoing and any and all other documents furnished pursuant hereto or thereto
or in connection herewith or therewith, (ii) any costs of printing the
Preliminary Memorandum and the Final Memorandum and any amendment or supplement
thereto, any other marketing related materials, (iii) all arrangements relating
to the delivery to the Initial Purchaser of copies of the foregoing documents,
(iv) the fees and disbursements of the counsel, the accountants and any other
experts or advisors retained by the Company and the Guarantors, (v) preparation
(including printing), issuance and delivery to the Initial Purchaser of the
Notes, (vi) the qualification of the Notes under state securities and "Blue
Sky" laws, including filing fees,
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word processing and reproduction costs of any "Blue Sky" memoranda and
reasonable fees and disbursements of counsel to the Initial Purchaser relating
thereto, (vii) expenses in connection with any meetings with prospective
investors in the Notes, (viii) fees and expenses of the trustee, including fees
and expenses of counsel to the Trustee, (ix) all expenses and listing fees
incurred in connection with the application for quotation of the Notes on
PORTAL, (x) any fees charged by investment rating agencies for the rating of
the Notes, and (xi) except as limited by Article VII, all costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses), if
any, in connection with the enforcement of this Agreement, the Notes or any
other agreement furnished pursuant hereto or thereto or in connection herewith
or therewith. In addition, the Company and the Guarantors shall pay any and
all stamp, transfer and other similar taxes payable or determined to be payable
in connection with the execution and delivery of this Agreement, any Basic
Document or the issuance of the Notes, and shall save and hold the Initial
Purchaser harmless from and against any and all liabilities with respect to or
resulting from any delay in paying, or omission to pay, such taxes.
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity.
(a) Indemnification by the Company and the Guarantors. The Company and
the Guarantors, jointly and severally, agree and covenant to hold harmless and
indemnify the Initial Purchaser and any Affiliates thereof (including any
director, officer, employee, agent or controlling Person of any of the
foregoing) from and against any losses, claims, damages, liabilities and
expenses (including expenses of investigation) to which such Initial Purchaser
and its Affiliates may become subject arising out of or based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Memorandum and any amendments or supplements thereto, the Basic Documents or
any application or other document filed by or on behalf of the Company or any
Guarantor with the Commission or any State Commission (collectively, the
"Offering Materials") or arising out of or based upon the omission or alleged
omission to state in any of the Offering Materials a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that the Com-
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pany and the Guarantors shall not be liable under this paragraph (a) to
the extent that such losses, claims, damages or liabilities arose out of or are
based upon an untrue statement or omission made in any of the documents
referred to in this paragraph (a) in reliance upon and in conformity with the
information relating to the Initial Purchaser furnished in writing by such
Initial Purchaser for inclusion therein; provided, further, that the Company
and the Guarantors shall not be liable under this paragraph (a) to the extent
that such losses, claims, damages or liabilities arose out of or are based upon
an untrue statement or omission made in any Memorandum that is corrected in the
Final Memorandum (or any amendment or supplement thereto) if the person
asserting such loss, claim, damage or liability purchased Notes from the
Initial Purchaser in reliance on such Memorandum but was not given the Final
Memorandum (or any amendment or supplement thereto) on or prior to the
confirmation of the sale of such Notes. The Company and the Guarantors, on a
joint and several basis, further agree to reimburse the Initial Purchaser for
any reasonable legal and other expenses as they are incurred by it in
connection with investigating, preparing to defend or defending any lawsuits,
claims or other proceedings or investigations arising in any manner out of or
in connection with such Person being the Initial Purchaser; provided that if
the Company or the Guarantors reimburses the Initial Purchaser hereunder for
any expenses incurred in connection with a lawsuit, claim or other proceeding
for which indemnification is sought, the Initial Purchaser hereby agrees to
refund such reimbursement of expenses to the extent that the losses, claims,
damages or liabilities are not entitled to indemnification hereunder. The
Company and the Guarantors further agree that the indemnification, contribution
and reimbursement commitments set forth in this Article VII shall apply whether
or not the Initial Purchaser is a formal party to any such lawsuits, claims or
other proceedings. The indemnity, contribution and expense reimbursement
obligations of the Company and the Guarantors under this Article VII shall be
in addition to any liability the Company and the Guarantors may otherwise have.
(b) Indemnification by the Initial Purchaser. The Initial Purchaser
agrees and covenants to hold harmless and indemnify the Company and the
Guarantors and any Affiliates thereof (including any director, officer,
employee, agent or controlling Person of any of the foregoing) from and against
any losses, claims, damages, liabilities and expenses insofar as such losses,
claims, damages, liabilities or expenses arise out of or are based upon any
untrue statement of any material fact contained in the Offering Materials, or
upon the omission
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to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or omission was made
in reliance upon and in conformity with the information relating to the Initial
Purchaser furnished in writing by the Initial Purchaser for inclusion therein.
The indemnity, contribution and expense reimbursement obligations of the
Initial Purchaser under this Article VII shall be in addition to any liability
the Initial Purchaser may otherwise have.
(c) Procedure. If any Person shall be entitled to indemnity hereunder
(each an "Indemnified Party"), such Indemnified Party shall give prompt written
notice to the party or parties from which such indemnity is sought (each an
"Indemnifying Party") of the commencement of any action, suit, investigation or
proceeding, governmental or otherwise (a "Proceeding"), with respect to which
such Indemnified Party seeks indemnification or contribution pursuant hereto;
provided, however, that the failure so to notify the Indemnifying Parties shall
not relieve the Indemnifying Parties from any obligation or liability except to
the extent that the Indemnifying Parties have been prejudiced materially by
such failure. The Indemnifying Parties shall have the right, exercisable by
giving written notice to an Indemnified Party promptly after the receipt of
written notice from such Indemnified Party of such Proceeding, to assume, at
the Indemnifying Parties' expense, the defense of any such Proceeding, with
counsel reasonably satisfactory to such Indemnified Party; provided, however,
that an Indemnified Party or parties (if more than one such Indemnified Party
is named in any Proceeding) shall have the right to employ separate counsel in
any such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or
parties unless: (1) the Indemnifying Parties agree to pay such fees and
expenses; or (2) the Indemnifying Parties fail promptly to assume the defense
of such Proceeding or fail to employ counsel reasonably satisfactory to such
Indemnified Party or parties; or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party or
parties and the Indemnifying Party or an Affiliate of the Indemnifying Party
and such Indemnified Parties, and the Indemnified Parties shall have been
advised in writing by counsel that there may be one or more legal defenses
available to such Indemnified Party or parties that are different from or
additional to those available to the Indemnifying Parties, in which case, if
such Indemnified Party or parties notifies the Indemnifying Parties in writing
that it elects to
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employ separate counsel at the expense of the Indemnifying Parties, the
Indemnifying Parties shall not have the right to assume the defense thereof on
behalf of such Indemnified Party or parties and such counsel shall be at the
expense of the Indemnifying Parties, it being understood, however, that, unless
there exists a conflict among Indemnified Parties, the Indemnifying Parties
shall not, in connection with any one such Proceeding or separate but
substantially similar or related Proceedings in the same jurisdiction, arising
out of the same general allegations or circumstances, be liable for the fees
and expenses of more than one separate firm of attorneys (together with
appropriate local counsel) at any time for such Indemnified Party or parties,
or for fees and expenses that are not reasonable. No Indemnified Party or
parties will settle any Proceeding without the consent of the Indemnifying
Party or Parties (but such consent shall not be unreasonably withheld). No
Indemnifying Party shall, without the prior written consent of the Indemnified
Party, effect any settlement of any pending or threatened Proceeding in respect
of which any Indemnified Party is or could have been a party and indemnity
could have been sought hereunder by such Indemnified Party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability or claims that are the subject of such Proceeding.
Section 7.2. Contribution. If for any reason the indemnification
provided for in Section 7.1 of this Agreement is unavailable to an Indemnified
Party, or insufficient to hold it harmless, in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then each applicable
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and the Indemnified Party on the other from
the Offering of the Notes, but also the relative fault of the Indemnifying and
Indemnified Parties in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the
Indemnifying and Indemnified Parties shall be deemed to be in the same
proportion as the total proceeds from the offering of the Notes (before
deducting expenses) received by the Company bear to the total discounts and
commissions received by the Initial Purchaser. The relative fault of the
Indemnifying and Indemnified Parties shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a ma-
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terial fact or the omission or alleged omission to state a material
fact relates to information supplied by the Indemnifying or Indemnified
Parties and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid
or payable by a party as a result of the losses, claims, damages and
liabilities referred to above shall be deemed to include any legal or other
fees or expenses incurred by such party in connection with investigating or
defending any such claim.
The Company and the Guarantors and the Initial Purchaser agree that it
would not be just and equitable if contribution pursuant to the
immediately preceding paragraph were determined pro rata or per capita or by
any other method of allocation which does not take into account the equitable
considerations referred to in such paragraph. Notwithstanding any other
provision of this Section 7.2, the Initial Purchaser shall not be obligated to
make contributions hereunder that in the aggregate exceed the total discounts,
commissions and other compensation received by the Initial Purchaser under this
Agreement, less the aggregate amount of any damages that the Initial Purchaser
has otherwise been required to pay by reason of the untrue or alleged untrue
statements or the omissions or alleged omissions to state a material fact. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.
Section 7.3. Registration Rights Agreement. Notwithstanding anything to
the contrary in this Article 7, the indemnification and contribution provisions
of the Registration Rights Agreement shall govern any claim with respect
thereto.
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions. The representations, warranties and
covenants of the Company, the Guarantors, their respective officers and the
Initial Purchaser made herein, the indemnity and contribution agreements
contained herein and each of the provisions of Articles VI, VII and VIII shall
remain operative and in full force and effect regardless of (a) any
investigation made by or on behalf of the Company, the Guarantors, the Initial
Purchaser or any Indemnified Party,
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(b) acceptance of any of the Notes and payment therefor, (c) any
termination of this Agreement, or (d) disposition of the Notes by the Initial
Purchaser whether by redemption, exchange, sale or otherwise.
Section 8.2. Termination. (a) This Agreement may be terminated in the
sole discretion of the Initial Purchaser by notice to the Company given prior
to the Time of Purchase in the event that the Company or the Guarantors shall
have failed, refused or been unable to perform all obligations and satisfy all
conditions on their part to be performed or satisfied here under at or prior
thereto or, if at or prior to the Closing:
(1) the Company or the Guarantors or any of the Loon Entities
shall have sustained any loss or interference with respect to their
businesses or properties from fire, flood, hurricane, accident or
other calamity, whether or not covered by insurance, or from any
strike, labor dispute, slow down or work stoppage or any legal or
governmental proceeding, which loss or interference, in the sole
judgment of the Initial Purchaser, has had or has a Material
Adverse Effect, or there shall have been, in the sole judgment of
the Initial Purchaser, any event or development that, individually
or in the aggregate, has or would reasonably be expected to have a
Material Adverse Effect (including without limitation a Change of
Control (as defined in the Indenture) of the Company or the
Guarantors), except in each case as described in the Final
Memorandum (exclusive of any amendment or supplement thereto);
(2) trading in securities of the Company generally on the New
York Stock Exchange, American Stock Exchange or the Nasdaq National
Market shall have been suspended or minimum or maximum prices shall
have been established on any such exchange or market;
(3) a banking moratorium shall have been declared by New York
or United States authorities;
(4) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power (other
than Iraq), or (B) an outbreak or escalation of any other
insurrection or armed conflict involving the United States or any
other national or international calamity or emergency, or (C) any
material change in the financial
43
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markets of the United States which, in the case of (A), (B) or
(C) above and in the sole judgment of the Initial Purchaser, makes
it impracticable or inadvisable to proceed with the offering or the
delivery of the Notes as contemplated by the Final Memorandum; or
(5) any securities of the Company shall have been downgraded
or placed on any "watch list" for possible downgrading by any
nationally recognized statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 8.2 shall be
without liability of any party to any other party except as provided in Section
8.1 hereof.
Section 8.3. No Waiver; Modifications in Writing. No failure or delay on
the part of the Company, the Guarantors or the Initial Purchaser in exercising
any right, power or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. The remedies provided for herein are cumulative and
are not exclusive of any remedies that may be available to the Company or the
Guarantors or the Initial Purchaser at law or in equity or otherwise. No
waiver of or consent to any departure by the Company or the Guarantors from any
provision of this Agreement shall be effective unless signed in writing by the
party entitled to the benefit thereof, provided that notice of any such waiver
shall be given to each party hereto as set forth below. Except as otherwise
provided herein, no amendment, modification or termination of any provision of
this Agreement shall be effective unless signed in writing by or on behalf of
each of the Company, the Guarantors and the Initial Purchaser. Any amendment,
supplement or modification of or to any provision of this Agreement, any waiver
of any provision of this Agreement, and any consent to any departure by the
Company or the Guarantors from the terms of any provision of this Agreement,
shall be effective only in the specific instance and for the specific purpose
for which made or given. Except where notice is specifically required by this
Agreement, no notice to or demand on the Company or the Guarantors in any case
shall entitle the Company or the Guarantors to any other or further notice or
demand in similar or other circumstances.
Section 8.4. Information Supplied by the Initial Purchaser. The
statements set forth in the first paragraph on page (i), the fourth and the
fifth sentences of the third para-
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graph and in the seventh, eighth and ninth paragraphs under the heading "Plan
of Distribution" in the Final Memorandum (to the extent such statements relate
to the Initial Purchaser) constitute the only information furnished by the
Initial Purchaser to the Company for the purposes of Sections 3.1(a) and 7.1(a)
and (b) hereof.
Section 8.5. Communications. All notices, demands and other
communications provided for hereunder shall be in writing, and, (a) if
to the Initial Purchaser, shall be given by registered or certified mail,
return receipt requested, telex, telegram, telecopy, courier service or
personal delivery, addressed to CIBC Xxxxxxxxxxx Corp., 000 Xxxxxxxxx Xxxxxx,
0xx xxxxx, Xxx Xxxx, Xxx Xxxx 00000, with a copy to Xxxxxx Xxxxxx & Xxxxxxx, 00
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: Xxxxx Xxxxxxx, Esq. and (b)
if to the Company or the Guarantors, shall be given by similar means to Booth
Creek Ski Holdings, Inc., Highway 267 and Northstar Drive, Truckee, California,
Attention: Chief Financial Officer, with copies to Winston & Xxxxxx, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxx, Esq. In each case
notices, demands and other communications shall be deemed given when received.
Section 8.6. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original and all of which counterparts, taken together,
shall constitute but one and the same Agreement.
Section 8.7. Successors. This Agreement shall inure to the benefit of
and be binding upon the Initial Purchaser, the Company, the Guarantors and
their respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
Person any legal or equitable right, remedy or claim under or in respect of
this Agreement, or any provisions herein contained; this Agreement and all
conditions and provisions hereof being intended to be and being for the sole
and exclusive benefit of such Persons and for the benefit of no other Person
except that (i) the indemnities of the Company and the Guarantors contained in
Section 7.1(a) of this Agreement shall also be for the benefit of the
directors, officers, employees and agents of the Initial Purchaser and any
Person or Persons who control the Initial Purchaser within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act and (ii) the
indemnities of the Initial Purchaser contained in Section 7.1(b) of this
Agreement shall also be for the benefit of
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the directors of the Company and the Guarantors, their officers and any
Person or Persons who control the Company or the Guarantors within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act. No purchaser of
Notes from the Initial Purchaser will be deemed a successor because of such
purchase.
Section 8.8. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
Section 8.9. Severability of Provisions. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 8.10. Headings. The Article and Section headings and Table of
Contents used or contained in this Agreement are for convenience of reference
only and shall not affect the construction of this Agreement.
46
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
BOOTH CREEK SKI HOLDINGS, INC.
By: /s/ Xxxxxxx Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President,
Finance
TRIMONT LAND COMPANY
SIERRA-AT-TAHOE
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
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President,
Finance
At the Effective Time:
LMRC HOLDING CORP.
LOON MOUNTAIN RECREATION CORPORATION
LOON REALTY CORP.
By: /s/ Xxxxxxx Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President,
Finance
47
CIBC XXXXXXXXXXX CORP.
By: /s/Xxxxxx Xxxx
------------------------------
Name: Xxxxxx Xxxx
Title: Managing Director
