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EXHIBIT 4.4
________________________________________________________________________________
SECURITIES PURCHASE AGREEMENT
by and among
BOOTH CREEK SKI HOLDINGS, INC.,
THE GUARANTORS NAMED HEREIN
and
THE INITIAL PURCHASER NAMED HEREIN
______________________________
Dated as of March 13, 1997
________________________________________________________________________________
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Accounting Terms; Financial
Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.2. Purchase, Sale and Delivery of Notes;
Grant of Option to Purchase Additional
Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.3. Registration Rights of Holders
of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.4. Offering by the Initial Purchaser . . . . . . . . . . . . . . . . . . . . 9
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF NOTES
Section 3.1. Representations and Warranties of
the Company and the Guarantors . . . . . . . . . . . . . . . . . . . 9
Section 3.2. Resale of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations
of the Initial Purchaser . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the
Guarantors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
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ARTICLE VI
FEES
Section 6.1 Costs, Expenses and Taxes . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.2. Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 7.3. Registration Rights Agreement . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 8.2. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 8.3. No Waiver; Modifications in
Writing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 8.4 Information Supplied by the Initial
Purchaser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.5. Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.6. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.7. Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.8. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.9. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.10. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SIGNATURE PAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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SECURITIES PURCHASE AGREEMENT, dated as of March 13, 1997 (the
"Agreement"), among BOOTH CREEK SKI HOLDINGS, INC., a Delaware corporation (the
"Company"), the Guarantors (as defined herein) and CIBC WOOD GUNDY SECURITIES
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.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking
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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.
"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, (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
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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.
"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.
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"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. and Ski Lifts, Inc.
"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
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, or other title retention agreement having
substantially the same economic effect as any of the foregoing.
"Material Adverse Effect" means, with respect to the Company
and its Subsidiaries, a material adverse effect on the business, condition
(financial or otherwise), results of operations or prospects of the Company and
its Subsidiaries, 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.
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"Notes" means the 12 1/2% 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.
"Option" has the meaning provided therefor in Section 2.2(b)
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 and
the Subsidiaries of the Company, taken as a whole.
"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 or Subsidiaries of the
Company and, as used in Section 3.1(y), including land, buildings, improvements
and fixtures operated by the Company or Subsidiaries of the Company.
"Registration Rights Agreement" means the registration rights
agreement among the Company, the Guarantors and the Initial Purchaser relating
to the Notes.
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"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.
"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.
"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,
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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.
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 $110,000,000 aggregate principal amount of the Notes which are to
be issued pursuant to the Indenture. The Company has also authorized the
issuance of up to an additional $6,000,000 aggregate principal amount of the
Notes which are to be issued pursuant to the Indenture upon exercise by the
Initial Purchaser of its Option (as defined in Section 2.2(b) hereof) and to
the extent and subject to the terms thereof. 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.
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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 25,
1997 (the "Preliminary Memorandum") and prepared a final offering memorandum
dated March 13, 1997 (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 any material developments relating to the
Company and the Guarantors occurring after the date of the most recent
financial statements included therein.
Section 2.2. Purchase, Sale and Delivery of Notes; Grant of
Option to Purchase Additional Notes. (a) 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, $110,000,000 aggregate principal amount of
the Notes (the "Firm Notes") at a price equal to 97% of the principal amount
thereof.
(b) In addition, on the basis of the representations,
warranties, agreements and covenants herein contained and subject to the terms
and conditions herein set forth, the Company hereby grants an option (the
"Option") to the Initial Purchaser to purchase up to an additional $6,000,000
aggregate principal amount of the Notes (the "Option Notes"), at the price per
Note set forth in Section 2.2(a) hereof. The Option will expire thirty (30)
days after the date hereof and may be exercised in whole or in part upon notice
by the Initial Purchaser to the Company setting forth the aggregate principal
amount of Option Notes as to which the Initial Purchaser is then exercising the
Option and the time and date of payment and delivery for such Option Notes.
Such time and date of delivery, if any (any such date, a "Date of Delivery"),
shall be determined by the Initial Purchaser, but shall not be later than ten
(10) full business days after any exercise of said Option.
(c) The purchase, sale and delivery of the Firm Notes
will take place at a closing (the "Closing") at the offices of Winston &
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 10:00 A.M., New York time, on
March 18, 1997, or such later date and time, if any, as the Initial Purchaser
and the Company shall
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agree. The time at which such Closing is concluded is herein called the "Time
of Purchase." In addition, in the event that any or all of the Option Notes
are purchased by the Initial Purchaser, payment of the purchase price for, and
delivery of certificates for, such Option Notes shall be made at the offices of
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such
other place as shall be agreed upon by the Initial Purchaser and the Company on
the Date of Delivery specified in the notice from the Initial Purchaser to the
Company.
(d) 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 or any Date of Delivery, as the case may be, 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 or any
Date of Delivery, as the case may be.
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,
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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 or Date of Delivery, as the case may be, 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 balance sheet of the Company together
with related notes, set forth in the Final Memorandum fairly presents
the financial condition of the Company as of the date indicated
therein. The audited financial statements of each of the Resort Group
of Fibreboard Corporation; Waterville Valley Ski Area Ltd.; Ski Lifts,
Inc.; and Grand Targhee Incorporated (collectively, the "Audited
Entities") 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, as of the dates
indicated 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;
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 (except with respect to the adjusted pro forma financial
data and note K 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) and
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
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indicated. Ernst & Young LLP, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, Coopers & ▇▇▇▇▇▇▇
LLP and ▇▇▇▇▇▇▇▇ & Associates, P.C. (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.
(c) The Company and each Subsidiary 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 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 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 contemplated by the Basic Documents), the
Company will have the authorized, issued and outstanding
capitalization as set forth in the Final Memorandum (which does not
give effect to any exercise of the Option by the Initial Purchaser).
All of the issued and outstanding shares of capital stock of the
Company and its Subsidiaries are validly issued, all of such capital
stock is fully paid and nonassessable and none of such shares or
interests were 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, (i) all of the outstanding
shares of Capital Stock of the Company and each of its Subsidiaries
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 to issue any securities and (iii) there is no agreement,
understanding or arrangement among the Company or its Subsidiaries and
their respective securityholders or any other Person relating to the
ownership or disposition of any Capital Stock in the
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Company or its Subsidiaries, the election of directors of the Company
or any of its Subsidiaries or the governance of the Company's or any
of its Subsidiaries' affairs, 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 by the Company
and each of the Guarantors and, when executed and delivered by the
Company and each of the Guarantors (assuming the due authorization,
execution and delivery by the Trustee), will constitute 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 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,
16
-13-
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 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
17
-14-
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 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, other than in the ordinary course of business, that is
material to the Company or the Guarantors, 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, governmental or
otherwise, pending or, to the best knowledge of the Company,
threatened to which the Company or the Guarantors 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
18
-15-
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 (ii) conflict with or result in a
breach of or constitute a default under the organizational documents
of the Company or the Guarantors 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, is a party or
by which the Company or the Guarantors, 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, 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, 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
19
-16-
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 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 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,
20
-17-
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 is, and
immediately after the Time of Purchase will not 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. 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 made with respect to any Employee Benefit Plan (as
defined below), and the Company and each of its Subsidiaries 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 their Subsidiaries, 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, nor any
Commonly Controlled Entity would become subject to any liability under
ERISA if the Company, any of its Subsidiaries, 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
21
-18-
liabilities of the Company, any of its Subsidiaries, 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 may, directly or indirectly (though a
Commonly Controlled Entity or otherwise), to 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 or any Subsidiary of
the Company, is 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
or any Commonly Controlled Entity or to which the Company, any of its
Subsidiaries or any Commonly Controlled Entity may have liability for
which the Company and its Subsidiaries are not fully indemnified.
(t) The Company and each of its Subsidiaries 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 and each of its Subsidiaries and under which the Company and
each of its Subsidiaries 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
22
-19-
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 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 Company 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 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 that, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect.
(w) The Company and each of its Subsidiaries 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 nor
any of its Subsidiaries 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 property which
23
-20-
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 is in compliance with all, and have
no liability under any, laws, rules and regulations (including,
without limitation, all applicable Environmental Laws, rules and
regulations) applicable to the Company, and the Company 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 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 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, or, 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
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
24
-21-
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 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 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 its Subsidiary Guarantors, there have
been no Releases of Hazardous Materials at, on, under or from any of
the Real Property Assets 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 or any Subsidiaries of the Company 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 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 or any Subsidiaries of the Company except for any such Lien
which would not reasonably be expected to have a Material Adverse
Effect;
25
-22-
(6) There have been no past or present events, conditions
or activities which could reasonably be expected to prevent the
Company or any of its Subsidiaries 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 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 or any of its Subsidiaries 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 and its Subsidiaries 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 or its Subsidiaries 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.
26
-23-
(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, 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.
(gg) The Company and each of the Guarantors 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 know of any claims against the
Company or any of the Guarantors 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.
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, (i)
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 or (ii) a limited number of
other institutional investors reasonably believed by the Initial Purchaser to
be "Accredited Investors" (as defined in Rule 501(a)(1), (2), (3) or
27
-24-
(7) of the Act) that, prior to their purchase of the Notes, deliver to the
Initial Purchaser a letter containing the representations and agreements set
forth in Annex A to the Final Memorandum 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.
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 to the satisfaction or waiver
of the following conditions:
(a) At the Time of Purchase, the Initial Purchaser shall
have received an opinion, dated as of the Time of Purchase and
addressed to the Initial Purchaser, of Winston & ▇▇▇▇▇▇, counsel for
the Company and the Guarantors, in the form set forth on Exhibit A
hereto. 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 Ski Lifts, Inc., in form and substance satisfactory to counsel
for the Initial Purchaser.
(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 ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial Purchaser.
(c) The Initial Purchaser shall have received from each
of Ernst & Young LLP, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, Coopers & ▇▇▇▇▇▇▇ LLP and
▇▇▇▇▇▇▇▇ & Associates P.C., a comfort letter or letters dated the date
hereof and the Closing in form and substance reasonably satisfactory
to counsel to the Initial Purchaser.
28
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(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 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.
(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
Chairman of the Board, President or any Vice President and the Chief
Financial Officer of each of 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
29
-26-
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.
(k) The sale of the Notes hereunder shall not 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) In the event that the Initial Purchaser exercises its
Option provided in Section 2.2(b) hereof to purchase all or any
portion of the Option Notes, the representations and warranties of the
Company and the Guarantors contained herein and the statements in any
certificates furnished by the Company and the Guarantors hereunder
shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Initial Purchaser shall have received:
(1) A certificate, dated such Date of Delivery, of
the Chairman of the Board, President or any Vice President and
the Chief Financial Officer of each of the Company and the
Guarantors confirming that the certificate delivered at the
Time of Purchase pursuant to Section 4.1(h) hereof remains
true and correct as of such Date of Delivery.
(2) The favorable opinion of Winston & ▇▇▇▇▇▇,
counsel for the Company and the Guarantors, and of local
counsel for Trimont Land Company and for Ski Lifts, Inc., each
in form and substance satisfactory to counsel for the Initial
Purchaser, dated such Date of Delivery, relating to the Option
Notes to be purchased on such Date of Delivery and otherwise
to the same effect as the opinion required by Section 4.1(a)
hereof.
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(3) A letter from Ernst & Young LLP,, in form and
substance satisfactory to counsel to the Initial Purchaser and
dated such Date of Delivery, substantially the same in form
and substance as the letters furnished to the Initial
Purchaser pursuant to Section 4.1(c) hereof, except that the
"specified date" in the letter furnished pursuant to this
Section 4.1(m)(3) shall be a date not more than three days
prior to such Date of Delivery.
On or before the Closing or Date of Delivery, as the case may
be, 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 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
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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.
(e) The Company will apply the net proceeds from the sale
of the Notes 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
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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 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
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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) all
reasonable out-of-pocket expenses (including word processing charges, messenger
and duplicating services, research document expenses, travel expenses and other
customary expenditures) of the Initial Purchaser, plus the reasonable fees and
expenses of its legal counsel, (vi) preparation (including printing), issuance
and delivery to the Initial Purchaser of the Notes, (vii) the qualification of
the Notes under state securities and "Blue Sky" laws, including filing fees,
word processing and reproduction costs of any "Blue Sky" memoranda and
reasonable fees and disbursements of counsel to the Initial Purchaser relating
thereto, (viii) expenses in connection with any meetings with prospective
investors in the Notes, (ix) fees and expenses of the trustee, including fees
and expenses of counsel to the Trustee, (x) all expenses and listing fees
incurred in connection with the application for quotation of the Notes on
PORTAL, (xi) any fees charged by investment rating agencies for the rating of
the Notes, and (xii) 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
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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 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 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
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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 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,
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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 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
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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 material 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
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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, (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 hereunder at or prior thereto or, if at or prior to the Closing:
(1) the Company or the Guarantors 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
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aggregate, has or would be 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, 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
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
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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 paragraph and in the sixth paragraph 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 Wood Gundy Securities Corp., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, 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 and General Counsel, with copies to Winston
& ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇,
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
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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 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.
42
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.
(a Delaware corporation)
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President, Finance
43
CIBC WOOD GUNDY SECURITIES CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. Phoenix
------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Phoenix
Title: Managing Director
44
EXHIBIT A
[FORM OF OPINION OF COUNSEL OF COMPANY]
CIBC Wood Gundy Securities Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as special counsel to Booth Creek Ski Holdings, Inc., a
Delaware corporation (the "Company"), Trimont Land Company, a California
corporation ("Trimont"), Sierra-at-Tahoe, Inc., a Delaware corporation, Bear
Mountain, Inc., a Delaware corporation, Booth Creek Ski Acquisition Corp., a
Delaware corporation, Waterville Valley Ski Resort, Inc., a Delaware
corporation, Mount Cranmore Ski Resort, Inc., a Delaware corporation, and Ski
Lifts, Inc., a Washington corporation ("Ski Lifts") (collectively, the
"Subsidiary Guarantors"), in connection with the issuance and sale by the
Company, pursuant to the Securities Purchase Agreement dated as of March 13,
1997 (the "Purchase Agreement") among the Company, the Subsidiary Guarantors
and CIBC Wood Gundy Securities Corp. (the "Initial Purchaser"), of $110 million
aggregate principal amount of the Company's 12 1/2% Senior Notes due 2007 (the
"Notes"), which will be issued under an Indenture dated as of March 17, 1997
(the "Indenture") among the Company, the Subsidiary Guarantors and Marine
Midland Bank, as trustee.
This opinion is furnished to you pursuant to Section 4.1(a) of the
Purchase Agreement. Except as otherwise specified, capitalized terms used
herein and not otherwise defined shall have the same meanings as are ascribed to
such terms in the Purchase Agreement.
In rendering the opinions set forth herein, we have examined:
(i) the Certificate of Incorporation and Bylaws of the Company and each of
the Subsidiary Guarantors;
(ii) resolutions of the Board of Directors of the Company and each of the
Subsidiary Guarantors with respect to the transactions referred to
herein;
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(iii) the Final Memorandum;
(iv) the Indenture;
(v) the Notes;
(vi) the Purchase Agreement; and
(vii) the Registration Rights Agreement,
(the documents identified in clauses (iv) through (vii) are collectively
hereinafter referred to as the "Transaction Documents") and such other
agreements, instruments and documents, and such questions of law as we have
deemed necessary or appropriate to enable us to render the opinions expressed
below. Additionally, we have examined originals or copies, certified to our
satisfaction, of such certificates of public officials and officers and
representatives of the Company and the Subsidiary Guarantors, and we have made
such inquiries of officers and representatives of the Company and the
Subsidiary Guarantors as we have deemed relevant or necessary, in connection
with the opinions set forth herein.
In rendering the opinions expressed below, we have, with your consent,
assumed that the signatures of persons signing all documents in connection with
which this opinion is rendered are genuine, all documents submitted to us as
originals or duplicate originals are authentic and all documents submitted to us
as copies, whether certified or not, conform to authentic original documents.
Additionally, we have, with your consent, assumed and relied upon, the
following;
(a) the accuracy and completeness of all certificates and other
statements, documents, records, financial statements and papers reviewed by us,
and the accuracy and completeness of all representations, warranties, schedules
and exhibits contained in the Transaction Documents, with respect to the factual
matters set forth therein;
(b) all parties to the documents reviewed by us (other than the Company
and the Subsidiary Guarantors (other than Trimont and Ski Lifts)) are duly
organized, validly existing and in good standing under the laws of all
jurisdictions where they are conducting their businesses or otherwise required
to be so qualified, and have full power and authority to execute, deliver and
perform under such documents and all such documents have been duly authorized,
executed and delivered by such parties; and
(c) the Notes have been delivered and paid for by the Initial Purchaser in
accordance with the terms of the Purchase Agreement, and each Transaction
Document constitutes the legal, valid and binding obligation of each party
thereto (other than the Company and the Subsidiary Guarantors) enforceable
against such party in accordance with its terms.
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Whenever our opinion with respect to the existence or absence of facts is
indicated to be based on our knowledge or awareness, we are referring to the
actual present knowledge of the particular attorneys presently members of or
employed by Winston & ▇▇▇▇▇▇ who have given substantive attention to matters
involving the Company and the Subsidiary Guarantors. Except as expressly set
forth herein, we have not undertaken any independent investigation, examination
or inquiry to determine the existence or absence of any facts (and have not
caused the review of any court file or indices) and no inference as to our
knowledge concerning any facts should be drawn as a result of the limited
representation undertaken by us.
Based upon the foregoing and subject to the qualifications and assumptions
stated herein, we are of the opinion that:
1. The Company and each of the Subsidiary Guarantors (A) (other than
Trimont and Ski Lifts, as to whom we express no opinion) is duly incorporated,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite corporate power and authority to own its properties and
conduct its business as described in the Final Memorandum and (B) is duly
qualified to do business as a foreign corporation and in good standing under the
laws of each jurisdiction where its ownership or leasing of its properties or
the conduct of its business requires such qualification, except where the
failure to be so qualified would not, individually or in the aggregate, have a
Material Adverse Effect.
2. Based solely on our review of the Company's and each of the Subsidiary
Guarantors' corporate minutes and stock transfer records, the Company has the
authorized, issued and outstanding capitalization set forth in the Final
Memorandum; all of the issued and outstanding shares of capital stock of the
Company and the Subsidiary Guarantors (other than Trimont and Ski Lifts, as to
whom we express no opinion) have been duly authorized and validly issued and are
fully paid and non-assessable; all of the issued and outstanding shares of
capital stock of the Company were not issued in violation of any preemptive or
similar rights; and except as set forth in the Final Memorandum, all of the
outstanding shares of capital stock of the Subsidiary Guarantors are owned of
record by the Company or another Subsidiary Guarantor.
3. Except as set forth in the Final Memorandum, to our knowledge (A) no
options, warrants or other rights to purchase from the Company or the Subsidiary
Guarantors shares of capital stock or ownership interests in the Company or the
Subsidiary Guarantors are outstanding, (B) no agreements or other obligations to
issue, or other rights to convert any obligation into, or exchange any
securities for, shares of capital stock or ownership interests in the Company or
the Subsidiary Guarantors are outstanding and (C) no holder of securities of the
Company or the Subsidiary Guarantors is entitled to have such securities
registered under a registration statement filed by the Company or the Subsidiary
Guarantors pursuant to the Registration Rights Agreement.
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4. The Company has all requisite corporate power and authority to
execute and deliver, and to perform its obligations under, each of the
Indenture, the Notes, the Exchange Notes and the Private Exchange Notes. Each
of the Subsidiary Guarantors (other than Trimont and Ski Lifts, as to whom we
express no opinion) has all requisite corporate power and authority to execute
and deliver, and to perform its obligations under, each of the Indenture, its
Guarantee and its guarantee to be endorsed on the Exchange Notes and the
Private Exchange Notes.
5. The Indenture meets the requirements for qualification under the
TIA.
6. The Indenture has been duly and validly authorized by the
Company and each of the Subsidiary Guarantors (other than Trimont and Ski
Lifts, as to whom we express no opinion) and, when the Indenture is duly
executed and delivered by the Company and each of the Subsidiary
Guarantors (assuming due authorization, execution and delivery thereof by
Trimont, Ski Lifts and the Trustee), the Indenture will constitute the valid
and legally binding agreements of the Company and each the Subsidiary
Guarantors, enforceable against the Company and each of the Subsidiary
Guarantors in accordance with its terms.
7. The Notes are in the form contemplated by the Indenture. The
Notes have each been duly and validly authorized by the Company and, when duly
executed and delivered by the Company and paid for by the Initial Purchaser in
accordance with the terms of the Purchase Agreement (assuming the due
authorization, execution and delivery of the Indenture by the Trustee and due
authentication and delivery of the Notes by the Trustee in accordance with the
Indenture), will constitute the valid and legally binding obligations of the
Company, entitled to the benefits of the Indenture, and enforceable against the
Company in accordance with their terms. 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 each of the Subsidiary
Guarantors (other than Trimont and Ski Lifts, as to whom we express no opinion)
and, when the Notes are executed by the Company and the Guarantees are executed
by the Subsidiary 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 the Purchase Agreement
(assuming due authorization, execution and delivery of the Indenture by
Trimont, Ski Lifts and the Trustee and due authorization and delivery of the
Notes by the Trustee in accordance with the Indenture), will constitute the
valid and legally binding obligations of each of the Subsidiary Guarantors,
entitled to the benefits of the Indenture, and enforceable against each of the
Subsidiary Guarantors in accordance with their terms.
8. The Exchange Notes and the Private Exchange Notes have been duly
and validly authorized by the Company, and when the Exchange Notes and the
Private Exchange Notes have been duly executed and delivered by the Company in
accordance with the terms of the Registration Rights Agreement and the
Indenture (assuming the due authorization, execution and delivery of the
Indenture by the Trustee and due authentication and delivery of the Exchange
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Notes and the Private Exchange Notes by the Trustee in accordance with the
Indenture), will constitute the valid and legally binding obligations of the
Company, entitled to the benefits of the Indenture, and enforceable against the
Company in accordance with their terms.
9. The Company and each of the Subsidiary Guarantors (other than
Trimont and Ski Lifts, as to whom we express no opinion) have all requisite
corporate power and authority to execute, deliver and perform their obligations
under the Registration Rights Agreement; the Registration Rights Agreement has
been duly and validly authorized by the Company and each of the Subsidiary
Guarantors (other than Trimont and SkiLifts, as to whom we express no opinion)
and, when duly executed and delivered by each of the Company and the Subsidiary
Guarantors (assuming due authorization, execution and delivery thereof by
Trimont, Ski Lifts and the Initial Purchaser), will constitute the valid and
legally binding agreement of the Company and each of the Subsidiary Guarantors,
enforceable against the Company and each of the Subsidiary Guarantors in
accordance with its terms, except that any rights to indemnity or contribution
thereunder may be limited by federal and state securities laws and public
policy considerations.
10. The Company and each of the Subsidiary Guarantors (other than
Trimont and Ski Lifts, as to whom we express no opinion) has all requisite
corporate power and authority to execute, deliver and perform its obligations
under the Purchase Agreement and to consummate the transactions contemplated
thereby; the Purchase Agreement and the consummation by the Company and each of
the Subsidiary Guarantors of the transactions contemplated thereby have been
duly and validly authorized by the Company and each of the Subsidiary
Guarantors (other than Trimont and Ski Lifts, as to whom we express no
opinion); and the Purchase Agreement has been duly executed and delivered by
the Company and each of the Subsidiary Guarantors (other than Trimont and Ski
Lifts, as to whom we express no opinion).
11. The Indenture, the Notes, the Guarantees and the Registration
Rights Agreement conform in all material respects to the descriptions thereof
contained in the Final Memorandum.
12. None of the Company or the Subsidiary Guarantors is (A) in
violation of its certificate of incorporation or bylaws (or similar
organizational document) (except we express no opinion with respect to Trimont
and Ski Lifts), (B) to our knowledge, in breach or violation of any statute,
judgment, decree, order, rule or regulation of the United States of America, the
State of New York or the General Corporation Law of the State of Delaware
applicable to it or any of its properties or assets, except for any such
breaches or violations which would not, individually or in the aggregate, have
a Material Adverse Effect, or (C) in breach or default under (nor has any event
occurred which, with notice or passage of time or both, would constitute a
default under) or in violation of any of the terms or provisions of any
agreements or instruments identified to us by the Company in an officers'
certificate (a copy of which is attached hereto as Exhibit A) as being all of
the Company's material contracts (the "Material Contracts") (except we express
no opinion as to (i) breaches, defaults, violations or events under
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Material Contracts which would not, individually or in the aggregate, have a
Material Adverse Effect, (ii) violations resulting from cross-default
provisions relating to defaults under an agreement which is not a Material
Contract and (iii) violations of financial covenants).
13. The execution, delivery and performance of the Purchase Agreement, the
Indenture and the Registration Rights Agreement and the consummation of the
transactions contemplated thereby (including, without limitation, the issuance
and sale of the Notes to the Initial Purchaser and the making of the Guarantees
by the Subsidiary Guarantors) will not conflict with or constitute or result in
a breach or a default under (or an event which with notice or passage of time
or both would constitute a default under) or violation of any of (A) the terms
or provisions of any Material Contract, except for any such conflicts,
breaches, violations, defaults or events which would not, individually or in
the aggregate, have a Material Adverse Effect, (B) the certificate of
incorporation or bylaws (or similar organizational document) of the Company or
any of the Subsidiary Guarantors (except we express no opinion with respect to
Trimont and Ski Lifts), or (C) (assuming compliance with all applicable state
securities or "Blue Sky" laws, as to which we render no opinion, and assuming
the accuracy of the representations and warranties of the Initial Purchaser in
Section 3.2 of the Purchase Agreement) any statute, judgement, decree, order,
rule or regulation of the United States of America, the State of New York or
the General Corporation Law of the State of Delaware known to us to be
applicable to the Company or any of the Subsidiary Guarantors or any of their
respective properties or assets, except for any such conflicts, breaches or
violations which would not, individually or in the aggregate, have a Material
Adverse Effect.
14. Assuming the accuracy of the representations and warranties of the
Company, the Subsidiary Guarantors and the Initial Purchaser in the Purchase
Agreement, no consent, approval, authorization or order of any governmental
authority is required for (A) the issuance and sale by the Company of the Notes
to the Initial Purchaser or the consummation by the Company of the other
transactions contemplated in the Purchase Agreement or (B) the issuance and sale
by the Subsidiary Guarantors of the Guarantees or the consummation by the
Subsidiary Guarantors of the other transactions contemplated in the Purchase
Agreement, except such as may be required under state securities or "Blue Sky"
laws, as to which we express no opinion, and those which have previously been
obtained; provided, however that we express no opinion as to any consent,
approval, authorization or order of any governmental authority that may be
required by virtue of the Initial Purchaser's legal or regulatory status.
15. To the best of our knowledge, the Company and the Subsidiary
Guarantors own or possess adequate licenses or other rights to use all patents,
trademarks, service marks, trade names, copyrights and know-how (collectively,
"Intellectual Property") necessary to conduct the business now operated by them
as described in the Final Memorandum, except where the failure to own or possess
adequate licenses or other rights to such Intellectual Property would not
reasonably be expected to have a Material Adverse Effect.
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16. To our knowledge, no legal or governmental proceedings are pending
or threatened to which any of the Company or the Subsidiary Guarantors is a
party or to which the property or assets of the Company or any of the
Subsidiary Guarantors is subject which, if determined adversely to the
Company or the Subsidiary Guarantors, would result, individually or in the
aggregate, in a Material Adverse Effect, or which seeks to restrain, enjoin,
prevent the consummation of or otherwise challenge the issuance or sale of the
Notes or the consummation of the other transactions in the Final Memorandum
under the caption "Use of Proceeds."
17. To our knowledge, there are no legal or governmental proceedings
involving or affecting the Company or any of the Subsidiary Guarantors or any
of their respective properties or assets which would be required to be
described in a prospectus pursuant to the Act that are not described in the
Final Memorandum, nor are there any material contracts or other documents which
would be required to be described in a prospectus pursuant to the Act that are
not described in the Final Memorandum.
18. None of the Company or the Subsidiary Guarantors is, or
immediately after the sale of the Notes and the Guarantees to be sold under the
Purchase Agreement and the application of the proceeds from such sale (as
described in the Final Memorandum under the caption "Use of Proceeds") will
be, in "investment company" as such term is defined in the Investment Company
Act of 1940, as amended.
19. No registration under the Act of the Notes or the Guarantees is
required in connection with the Notes to the Initial Purchaser as contemplated
by the Purchase Agreement and the Final Memorandum or in connection with the
initial resale of the Notes by the Initial Purchaser in accordance with Section
3.2 of the Purchase Agreement, and prior to the commencement of the Exchange
Offer (as defined in the Registration Rights Agreement) or the effectiveness of
the Shelf Registration Statement (as defined in the Registration Rights
Agreement), and the Indenture is not required to be qualified under the TIA, in
each case assuming (A)(i) that the purchasers who buy such Notes in the
initial resale thereof are qualified institutional buyers as defined in Rule
144A promulgated under the Act ("QIBs") or accredited investors as defined in
Rule 501(a)(1), (2), (3) or (7) promulgated under the Act ("Accredited
Investors") or (ii) that the offer or sale of the Notes is made to a non-U.S.
Person in an offshore transaction as such terms are defined in Regulation S
under the Act, (B) the accuracy of the Initial Purchaser's representations and
those of the Company contained in the Purchase Agreement regarding the absence
of a general solicitation in connection with the sale of such Notes to the
Initial Purchaser and the initial resale thereof and (C) the due performance by
the Initial Purchaser of the agreements set forth in Section 3.2 of the
Purchase Agreement.
20. Neither the consummation of the transactions contemplated by the
Purchase Agreement nor the sale, issuance, execution or delivery of the Notes
will violate Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System.
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In addition, we have participated in conferences with officers and
representatives of the Company and the Subsidiary Guarantors, representatives
of Ernst & Young LLP, the independent public accountants for the Company and
the Subsidiary Guarantors, representatives of the Initial Purchaser and counsel
for the Initial Purchaser, at which conferences the contents of the Final
Memorandum and related matter were discussed, and, although we have not
independently verified and are not passing upon and assume no responsibility
for the accuracy, completeness or fairness of the statements contained in the
Final Memorandum (except to the extent specified in paragraph 11 hereof), no
facts have come to our attention which lead us to believe that the Final
Memorandum, on the date thereof or at the Closing Date, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements contained therein, in light
of the circumstances under which they were made, not misleading (it being
understood that we express no opinion with respect to the financial statements
and related notes thereto and the other financial, statistical and accounting
data included in the Final Memorandum).
The opinions as expressed herein are subject to the following
qualifications and assumptions:
(a) the enforceability of the Indenture, the Notes, the Exchange
Notes, the Private Exchange Notes, the Purchase Agreement, the Registration
Rights Agreement and the obligations of the Company and the Subsidiary
Guarantors thereunder and the availability of certain rights and remedial
provisions provided for in such documents are subject to the effect of
bankruptcy, fraudulent conveyance or transfer, insolvency, reorganization,
arrangement, liquidation, conservatorship, and moratorium laws and are subject
to limitations imposed by other laws and judicial decisions relating to or
affecting the rights of creditors generally, and general principles of equity
(regardless of whether enforcement is considered in proceedings at law or in
equity) and upon the availability of injunctive relief or other equitable
remedies, including, without limitation, where (i) the breach of convenants or
provisions imposes restrictions or burdens upon a debtor and it cannot be
demonstrated that the enforcement of such remedies, restrictions or burdens is
reasonably necessary for the protection of a creditor; (ii) a creditor's
enforcement of remedies, covenants or provisions under the circumstances, or
the manner or procedures of such enforcement, would violate such creditor's
implied covenant of good faith and fair dealing, or would be commercially
unreasonable; or (iii) a court having jurisdiction finds that remedies,
covenants or provisions were, at the time made, or are in application,
unconscionable as a matter of law or contrary to public; and
(b) with respect to the Indenture, the Notes, the Exchange Notes,
the Private Exchange Notes, the Purchase Agreement and the Registration Rights
Agreement, we express no opinion as to (i) the enforceability of cumulative
remedies to the extent such cumulative remedies purport to or would have the
effect of compensating the party entitled to the benefits thereof in amounts in
excess of the actual loss suffered by such party or (ii) the severability
provisions contained in such documents; and
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(c) requirements in the Transaction Documents specifying that
provisions thereof may only be waived in writing may not be valid, binding or
enforceable to the extent that an oral agreement or an implied agreement by
trade practice or course of conduct has been created modifying any provision of
such documents.
The opinions expressed herein are based upon and are limited to the
laws of the State of New York, the General Corporation Law of the State of
Delaware and the laws of the United States of America and we express no opinion
with respect to the laws of any other state or jurisdiction.
Our opinions set forth in this letter are based upon the facts in
existence and laws in effect on the date hereof and we expressly disclaim any
obligation to update our opinions herein, regardless of whether changes in such
facts or laws come to our attention after the delivery hereof.
We understand that you will receive opinion letters from ▇▇▇▇▇, ▇'▇▇▇▇▇,
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special California counsel to the Company, and ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special Washington counsel to the Company, and believe
that you are justified in relying on such opinion letters.
This opinions is solely for the benefit of the addressee hereof in
connection with the consummation of the transactions contemplated by the
Purchase Agreement. This opinion may not be relied upon in any manner by any
other person and may not be disclosed, quoted, filed with a governmental agency
or otherwise referred to without our express prior written consent.
Very truly yours,