Document:

Exhibit 4.1

 

BUNGE LIMITED FINANCE CORP.,

as Issuer

 

 

BUNGE LIMITED,

as Guarantor

 

 

AND

 

 

UNION BANK, N.A.,

as Trustee

 

4.10% Senior Notes Due 2016

 

 

INDENTURE

 

Dated as of March 11, 2011

 

 

TABLE OF CONTENTS

 

	
ARTICLE 1
    
	
Definitions and   Incorporation by Reference
    
	
 
    	
 
    
	
Section 1.01.   Definitions
    	
1
    
	
 
    	
 
    
	
Section 1.02.   Incorporation by Reference of Trust Indenture Act
    	
12
    
	
 
    	
 
    
	
Section 1.03.   Rules of Construction
    	
12
    
	
 
    	
 
    
	
ARTICLE 2
    
	
The Notes
    
	
 
    	
 
    
	
Section 2.01. Form,   Dating and Terms
    	
13
    
	
 
    	
 
    
	
Section 2.02.   Execution and Authentication
    	
15
    
	
 
    	
 
    
	
Section 2.03.   Registrar and Paying Agent
    	
16
    
	
 
    	
 
    
	
Section 2.04. Paying   Agent to Hold Money in Trust
    	
17
    
	
 
    	
 
    
	
Section 2.05.   Noteholder Lists
    	
17
    
	
 
    	
 
    
	
Section 2.06.   Transfer and Exchange
    	
17
    
	
 
    	
 
    
	
Section 2.07.   Mutilated, Destroyed, Lost or Stolen Notes
    	
19
    
	
 
    	
 
    
	
Section 2.08.   Outstanding Notes
    	
20
    
	
 
    	
 
    
	
Section 2.09.   Temporary Notes
    	
20
    
	
 
    	
 
    
	
Section 2.10.   Cancellation
    	
20
    
	
 
    	
 
    
	
Section 2.11. Payment   of Interest; Defaulted Interest
    	
21
    
	
 
    	
 
    
	
Section 2.12.   Computation of Interest
    	
22
    
	
 
    	
 
    
	
Section 2.13. CUSIP   and ISIN Numbers
    	
22
    
	
 
    	
 
    
	
Section 2.14. Tax   Treatment
    	
22
    
	
 
    	
 
    
	
ARTICLE 3
    
	
Covenants
    
	
 
    	
 
    
	
Section 3.01. Payment   of Notes
    	
22
    
	
 
    	
 
    
	
Section 3.02.   Limitation and Restrictions on Activities of the Company
    	
22
    

 

i

 

	
Section 3.03.   Limitation on Liens
    	
24
    
	
 
    	
 
    
	
Section 3.04.   Limitation on Sale-Leaseback Transactions
    	
24
    
	
 
    	
 
    
	
Section 3.05.   Exclusion from Limitations
    	
24
    
	
 
    	
 
    
	
Section 3.06.   Maintenance of Office or Agency
    	
25
    
	
 
    	
 
    
	
Section 3.07.   Corporate Existence
    	
25
    
	
 
    	
 
    
	
Section 3.08. Maintenance   of Properties; Insurance
    	
25
    
	
 
    	
 
    
	
Section 3.09. Payment   of Taxes and Other Claims
    	
25
    
	
 
    	
 
    
	
Section 3.10.   Payments for Consent
    	
26
    
	
 
    	
 
    
	
Section 3.11.   Compliance Certificate
    	
26
    
	
 
    	
 
    
	
Section 3.12. Further   Instruments and Acts
    	
26
    
	
 
    	
 
    
	
Section 3.13.   Statement by Officers as to Default
    	
26
    
	
 
    	
 
    
	
Section 3.14. Notice   of Change in Bermuda Law, Debt Ratings
    	
26
    
	
 
    	
 
    
	
Section 3.15. Offer   to Repurchase Upon Change of Control
    	
27
    
	
 
    	
 
    
	
ARTICLE 4
    
	
Successor   Guarantor
    
	
 
    	
 
    
	
Section 4.01.   Consolidation, Merger, Amalgamation and Sale of Assets by the Guarantor
    	
29
    
	
 
    	
 
    
	
ARTICLE 5
    
	
Optional   Redemption of Notes
    
	
 
    	
 
    
	
Section 5.01.   Optional Redemption by the Company
    	
30
    
	
 
    	
 
    
	
Section 5.02.   Applicability of Article
    	
30
    
	
 
    	
 
    
	
Section 5.03.   Election to Redeem; Notice to Trustee
    	
31
    
	
 
    	
 
    
	
Section 5.04. Selection   by Trustee of Notes to Be Redeemed
    	
31
    
	
 
    	
 
    
	
Section 5.05. Notice   of Redemption
    	
31
    
	
 
    	
 
    
	
Section 5.06. Deposit   of Redemption Price
    	
32
    
	
 
    	
 
    
	
Section 5.07. Notes   Payable on Redemption Date
    	
32
    
	
 
    	
 
    
	
Section 5.08. Notes   Redeemed in Part
    	
33
    

 

ii

 

	
ARTICLE 6
    
	
Defaults   and Remedies
    
	
 
    	
 
    
	
Section 6.01. Events   of Default
    	
33
    
	
 
    	
 
    
	
Section 6.02.   Acceleration
    	
34
    
	
 
    	
 
    
	
Section 6.03. Other   Remedies
    	
35
    
	
 
    	
 
    
	
Section 6.04. Waiver   of Past Defaults
    	
35
    
	
 
    	
 
    
	
Section 6.05. Control   by Majority
    	
35
    
	
 
    	
 
    
	
Section 6.06.   Limitation on Suits
    	
36
    
	
 
    	
 
    
	
Section 6.07. Rights   of Holders to Receive Payment
    	
36
    
	
 
    	
 
    
	
Section 6.08.   Collection Suit by Trustee
    	
36
    
	
 
    	
 
    
	
Section 6.09. Trustee   May File Proofs of Claim
    	
36
    
	
 
    	
 
    
	
Section 6.10.   Priorities
    	
37
    
	
 
    	
 
    
	
Section 6.11. Undertaking   for Costs
    	
37
    
	
 
    	
 
    
	
ARTICLE 7
    
	
Trustee
    
	
 
    	
 
    
	
Section 7.01. Duties   of Trustee
    	
37
    
	
 
    	
 
    
	
Section 7.02. Rights   of Trustee
    	
39
    
	
 
    	
 
    
	
Section 7.03.   Individual Rights of Trustee
    	
40
    
	
 
    	
 
    
	
Section 7.04.   Trustee’s Disclaimer
    	
40
    
	
 
    	
 
    
	
Section 7.05. Notice   of Defaults
    	
41
    
	
 
    	
 
    
	
Section 7.06. Report   by Trustee to Holders
    	
41
    
	
 
    	
 
    
	
Section 7.07.   Compensation and Indemnity
    	
41
    
	
 
    	
 
    
	
Section 7.08.   Replacement of Trustee
    	
42
    
	
 
    	
 
    
	
Section 7.09.   Successor Trustee by Merger
    	
43
    
	
 
    	
 
    
	
Section 7.10.   Eligibility; Disqualification
    	
43
    
	
 
    	
 
    
	
Section 7.11.   Preferential Collection of Claims Against Company
    	
43
    

 

iii

 

	
Section 7.12.   Trustee’s Application for Instruction from the Company
    	
43
    
	
 
    	
 
    
	
ARTICLE 8
    
	
Discharge   of Indenture; Defeasance
    
	
 
    	
 
    
	
Section 8.01.   Discharge of Liability on Notes; Defeasance
    	
44
    
	
 
    	
 
    
	
Section 8.02.   Conditions to Defeasance
    	
45
    
	
 
    	
 
    
	
Section 8.03.   Application of Trust Money
    	
46
    
	
 
    	
 
    
	
Section 8.04.   Repayment to Company
    	
46
    
	
 
    	
 
    
	
Section 8.05.   Indemnity for U.S. Government Securities
    	
46
    
	
 
    	
 
    
	
Section 8.06. Reinstatement
    	
47
    
	
 
    	
 
    
	
ARTICLE 9
    
	
Amendments
    
	
 
    	
 
    
	
Section 9.01. Without   Consent of Holders
    	
47
    
	
 
    	
 
    
	
Section 9.02. With   Consent of Holders
    	
48
    
	
 
    	
 
    
	
Section 9.03.   Compliance with Trust Indenture Act
    	
48
    
	
 
    	
 
    
	
Section 9.04.   Revocation and Effect of Consents and Waivers
    	
49
    
	
 
    	
 
    
	
Section 9.05.   Notation on or Exchange of Notes
    	
49
    
	
 
    	
 
    
	
Section 9.06. Trustee   to Sign Amendments
    	
49
    
	
 
    	
 
    
	
ARTICLE 10
    
	
Guarantee
    
	
 
    	
 
    
	
Section 10.01.   Guarantee
    	
49
    
	
 
    	
 
    
	
Section 10.02. No   Subrogation
    	
51
    
	
 
    	
 
    
	
Section 10.03.   Consideration
    	
51
    
	
 
    	
 
    
	
ARTICLE 11
    
	
Miscellaneous
    
	
 
    	
 
    
	
Section 11.01. Trust   Indenture Act Controls
    	
51
    
	
 
    	
 
    
	
Section 11.02.   Notices
    	
51
    
	
 
    	
 
    
	
Section 11.03.   Communication by Holders with Other Holders
    	
52
    

 

iv

 

	
Section 11.04.   Certificate and Opinion as to Conditions Precedent
    	
53
    
	
 
    	
 
    
	
Section 11.05.   Statements Required in Certificate or Opinion
    	
53
    
	
 
    	
 
    
	
Section 11.06. When   Notes Disregarded
    	
53
    
	
 
    	
 
    
	
Section 11.07.   Rules by Trustee, Paying Agent and Registrar
    	
53
    
	
 
    	
 
    
	
Section 11.08. Legal   Holidays
    	
53
    
	
 
    	
 
    
	
Section 11.09.   Governing Law
    	
54
    
	
 
    	
 
    
	
Section 11.10. No   Recourse Against Others
    	
54
    
	
 
    	
 
    
	
Section 11.11.   Successors
    	
54
    
	
 
    	
 
    
	
Section 11.12.   Consent to Jurisdiction
    	
54
    
	
 
    	
 
    
	
Section 11.13.   Appointment for Agent for Service of Process
    	
54
    
	
 
    	
 
    
	
Section 11.14. Waiver   of Immunities
    	
54
    
	
 
    	
 
    
	
Section 11.15.   Additional Amounts
    	
55
    
	
 
    	
 
    
	
Section 11.16.   Judgment Currency
    	
55
    
	
 
    	
 
    
	
Section 11.17. No   Bankruptcy Petition Against the Company; Liability of the Company
    	
55
    
	
 
    	
 
    
	
Section 11.18.   Multiple Originals
    	
56
    
	
 
    	
 
    
	
Section 11.19.   Qualification of Indenture
    	
56
    
	
 
    	
 
    
	
Section 11.20. Table   of Contents; Headings
    	
56
    
	
 
    	
 
    
	
Section 11.21. Force   Majeure
    	
56
    
	
 
    	
 
    
	
Section 11.22. U.S.A.   Patriot Act
    	
57
    
	
 
    	
 
    
	
EXHIBIT A
    	
Form of the Initial Notes and Subsequent Notes
    	
 
    
	
SCHEDULE 1.1
    	
Designated Obligors and Material Subsidiaries
    	
 
    
	
SCHEDULE 3.4
    	
Existing Liens
    	
 
    

 

v

 

CROSS-REFERENCE TABLE

 

	
Trust Indenture
    	
 
    	
 
    
	
Act Section
    	
 
    	
Indenture
    
	
310(a)(1)
    	
 
    	
Section 7.10.
    
	
(a)(2)
    	
 
    	
Section 7.10.
    
	
(a)(3)
    	
 
    	
N.A.
    
	
(a)(4)
    	
 
    	
N.A.
    
	
(b)
    	
 
    	
Section 7.08., Section 7.10.
    
	
(c)
    	
 
    	
N.A.
    
	
311(a)
    	
 
    	
Section 7.11.
    
	
(b)
    	
 
    	
Section 7.11.
    
	
(c)
    	
 
    	
N.A.
    
	
312(a)
    	
 
    	
Section 2.05.
    
	
(b)
    	
 
    	
Section 11.03.
    
	
(c)
    	
 
    	
Section 11.03.
    
	
313(a)
    	
 
    	
Section 11.06.
    
	
(b)(1)
    	
 
    	
N.A.
    
	
(b)(2)
    	
 
    	
Section 7.06.
    
	
(c)
    	
 
    	
Section 7.06.
    
	
(d)
    	
 
    	
Section 7.06.
    
	
314(a)
    	
 
    	
Section 3.10., Section 11.02.
    
	
 
    	
 
    	
Section 11.05.
    
	
(b)
    	
 
    	
N.A.
    
	
(c)(1)
    	
 
    	
Section 11.04.
    
	
(c)(2)
    	
 
    	
Section 11.04.
    
	
(c)(3)
    	
 
    	
N.A.
    
	
(d)
    	
 
    	
N.A.
    
	
(e)
    	
 
    	
Section 11.05.
    
	
315(a)
    	
 
    	
Section 7.01.
    
	
(b)
    	
 
    	
Section 7.05., Section 11.02.
    
	
(c)
    	
 
    	
Section 7.01.
    
	
(d)
    	
 
    	
Section 7.01.
    
	
(e)
    	
 
    	
Section 6.11.
    
	
316(a)(last sentence)
    	
 
    	
Section 11.06.
    
	
(a)(1)(A)
    	
 
    	
Section 6.05.
    
	
(a)(1)(B)
    	
 
    	
Section 6.04.
    
	
(a)(2)
    	
 
    	
N.A.
    
	
(b)
    	
 
    	
Section 6.08.
    
	
317(a)(1)
    	
 
    	
Section 6.08.
    
	
(a)(2)
    	
 
    	
Section 6.09.
    
	
(b)
    	
 
    	
Section 2.04.
    
	
318(a)
    	
 
    	
Section 11.01.
    

 

N.A. means Not Applicable.

Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.

 

i

 

INDENTURE dated as of March 11, 2011, among BUNGE LIMITED FINANCE CORP., a Delaware corporation (the “Company”), as issuer, BUNGE LIMITED, a company formed under the laws of Bermuda with limited liability (the “Guarantor”), as guarantor, and UNION BANK, N.A., a national banking association (the “Trustee”), as trustee.

 

Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of (i) the Company’s 4.10% Senior Notes Due 2016 issued on the date hereof and the guarantees thereof by the Guarantor (the “Initial Notes”) and (ii) if and when issued, additional 4.10% Senior Notes Due 2016 which may be offered subsequent to the Issue Date and the guarantees thereof by the Guarantor (the “Subsequent Notes” and together with the Initial Notes, the “Notes”).

 

ARTICLE 1
 DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01.  Definitions.

 

“Affiliate” means, with respect to any specified Person, any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing; provided, however, that the existence of a management contract by the Company or an Affiliate of the Company to manage another entity shall not be deemed to be control.

 

“Agent Member” has the meaning ascribed to it in Section 2.01(d)(iii) hereof.

 

“Attributable Indebtedness” means, when used with respect to any Sale-Leaseback Transaction, as at the time of determination, the present value (discounted at the rate of interest set forth in or implicit in the terms of the lease) of the total obligations of the lessee for rental payments (other than amounts required to be paid on account of property taxes, maintenance, repairs, insurance, assessments, utilities, operating and labor costs and other items that do not constitute payments for property rights) during the remaining term of the lease included in such Sale-Leaseback Transaction (including any period for which such lease has been extended).

 

“Authenticating Agent” has the meaning ascribed to it in Section 2.02 hereof.

 

“Below Investment Grade Rating Event” means the Notes are rated below an Investment Grade Rating by each of the Rating Agencies on any date from the date of the public notice of an event that would, if consummated, result in a Change of Control until the end of the sixty (60) day period following public notice of the occurrence of the Change of Control, which sixty (60) day period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by each of the Rating Agencies.

 

“Board of Directors” means, with respect to any Person, the board of directors of such Person or any duly authorized committee thereof.

 

1

 

“Bunge Master Trust” means the trust created pursuant to the Pooling Agreement, a beneficial interest in the assets of which the Company has acquired through the Series 2002-1 VFC.

 

“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banking institutions are authorized or required by law to close in The City of New York, New York.

 

“Capital Stock” means, with respect to any Person, any and all shares, interests, rights to purchase, warrants, options (whether or not currently exercisable), participations or other equivalents of or interests in (however designated) the equity (which includes, but is not limited to, common stock or shares, preferred stock or shares and partnership and joint venture interests) of such Person (excluding any debt securities convertible into, or exchangeable for, such equity).

 

“Change of Control” means the occurrence of any of the following:

 

(1)                                  the Guarantor becomes aware (by way of report or any other filing pursuant to Section 13(d) of the Exchange Act or written notice) of the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination, of 50% or more of the total voting power of the Voting Stock of the Guarantor then outstanding;

 

(2)                                  the sale, lease or transfer of all or substantially all of the assets of the Guarantor and its Subsidiaries, taken as a whole, to any Person that is not a Subsidiary of the Guarantor; or

 

(3)                                  the first day on which a majority of the members of the Guarantor’s Board of Directors are not Continuing Directors.

 

“Change of Control Offer” has the meaning ascribed to it in Section 3.15 hereof.

 

“Change of Control Payment” has the meaning ascribed to it in Section 3.15 hereof.

 

“Change of Control Payment Date” has the meaning ascribed to it in Section 3.15 hereof.

 

“Change of Control Triggering Event” means the occurrence of a Change of Control that results in a Below Investment Grade Rating Event.

 

“Code” means the U.S. Internal Revenue Code of 1986, as amended.

 

“Company” means Bunge Limited Finance Corp. or its successor.

 

“Company Order” has the meaning ascribed to it in Section 2.02 hereof.

 

“Company Permitted Lien” means:

 

2

 

(1) Liens for current taxes, assessments or other governmental charges which are not delinquent or remain payable without any penalty, or the validity of which is contested in good faith by appropriate proceedings upon stay of execution of the enforcement thereof or upon posting a bond in connection therewith;

 

(2) any Lien pursuant to any order or attachment or similar legal process arising in connection with court proceedings; provided that the execution or other enforcement thereof is effectively stayed or a sufficient bond had been posted and the claims secured thereby are being contested at the time in good faith by appropriate proceedings;

 

(3) any Liens securing bonds posted with respect to and in compliance with clauses (1) and (2) above;

 

(4) Liens to secure bonds posted in order to obtain stays of judgments, attachments or orders, the existence of which bonds would not otherwise constitute an Event of Default; and

 

(5) Liens securing obligations under a Hedge Agreement.

 

“Consolidated Net Tangible Assets” means, at any date of determination, the total amount of assets of the Guarantor and its consolidated Subsidiaries after deducting therefrom:

 

(1)                                  all current liabilities (excluding any current liabilities that by their terms are extendable or renewable at the option of the obligor thereon to a time more than 12 months after the time as of which the amount thereof is being computed);

 

(2)                                  total prepaid expenses and deferred charges; and

 

(3)                                  all goodwill, trade names, trademarks, patents, licenses, copyrights and other intangible assets, all as set forth, or on a pro forma basis would be set forth, on the consolidated balance sheet of the Guarantor and its consolidated Subsidiaries for its most recently completed fiscal quarter, prepared in accordance with U.S. GAAP.

 

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Guarantor who (1) was a member of such Board of Directors on the date of the issuance of the Initial Notes; or (2) was nominated for election, appointed or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election (either by a specific vote or by approval of the Guarantor’s proxy statement in which such member was named as a nominee for election as a director).

 

“Corporate Trust Office” has the meaning ascribed to it in Section 3.05 hereof.

 

“covenant defeasance option” has the meaning ascribed to it in Section 8.01(b) hereof.

 

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

 

“Defaulted Interest” has the meaning ascribed to it in Section 2.11 hereof.

 

3

 

“Definitive Notes” means certificated Notes.

 

“Designated Obligor” means the Guarantor and the Subsidiaries of the Guarantor set forth on Schedule 1.1 hereto and any other Subsidiary designated by the Guarantor from time to time, and each of their successors.

 

“DTC” means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depository institution hereinafter appointed by the Company.

 

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.

 

“Event of Default” has the meaning ascribed to it in Section 6.01 hereof.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

 

“Fair Market Value” means, with respect to any property, the sale value of such property that would be realized in an arms-length sale at such time between an informed and willing buyer, and an informed and willing seller, under no compulsion to buy or sell, respectively.

 

“Fiscal Year” means the fiscal year of the Company ending on December 31 of each year.

 

“Fitch” means Fitch Ratings Limited.

 

“Global Note” has the meaning ascribed to it in Section 2.01(a) hereof.

 

“guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person:

 

(1)                                  to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise); or

 

(2)                                  entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);

 

provided, however, that the term “guarantee” will not include endorsements for collection or deposit in the ordinary course of business. The term “guarantee,” when used as a verb, has a corresponding meaning.

 

4

 

“Guarantee” means any guarantee of payment of the Notes and any other obligations of the Company by the Guarantor pursuant to the terms of this Indenture.

 

“Guarantor” means Bunge Limited.

 

“Guaranty” means the Sixth Amended and Restated Guaranty, dated as of June 11, 2007, by the Guarantor to Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., JPMorgan Chase Bank, N.A. and the Master Trust Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, subject to Section 3.02(f) hereof.

 

“Hedge Agreements” means all swaps, caps or collar agreements or similar arrangements dealing with interest rates or currency exchange rates or the exchange of nominal interest obligations, either generally or under specific contingencies.

 

“Holder” or “Noteholder” means the Person in whose name a Note is registered in the Note Register.

 

“Indebtedness” means, as to any Person, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (c) all obligations of such Person to pay the deferred purchase price of property, except trade accounts payable arising in the ordinary course of business, (d) all obligations of such Person as lessee which are capitalized in accordance with U.S. GAAP, (e) all obligations of such Person created or arising under any conditional sales or other title retention agreement with respect to any property acquired by such Person (including without limitation, obligations under any such agreement which provides that the rights and remedies of the seller or lender thereunder in the event of default are limited to repossession or sale of such property), (f) all obligations of such Person with respect to letters of credit and similar instruments, including without limitation obligations under reimbursement agreements, (g) all Indebtedness of others secured by (or for which the holder of such Indebtedness has existing right, contingent or otherwise, to be secured by) a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person and (h) all guarantees of such Person (other than guarantees of obligations of direct or indirect Subsidiaries of such Person).

 

“Indenture” means this Indenture, as amended or supplemented from time to time in accordance with its terms.

 

“Initial Notes” has the meaning ascribed to it in the second introductory paragraph of this Indenture.

 

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s, BBB- (or the equivalent) by S&P, BBB- (or the equivalent) by Fitch, or an equivalent rating by any other Rating Agency.

 

“Issue Date” means the date on which the Initial Notes are originally issued.

 

“legal defeasance option” has the meaning ascribed to it in Section 8.01(b) hereof.

 

5

 

“Legal Holiday” has the meaning ascribed to it in Section 11.08 hereof.

 

“Lien” means any mortgage, lien, security interest, pledge, charge or other encumbrance.

 

“Master Trust Transaction Documents” means the collective reference to the Pooling Agreement, the Series 2002-1 Supplement, the Series 2002-1 VFC, the Sale Agreement, the Servicing Agreement and the Guaranty.

 

“Master Trust Trustee” means The Bank of New York Mellon, as trustee under, and for the purposes of, the Master Trust Transaction Documents, and any successor thereto.

 

“Material Adverse Effect” means a material adverse effect, or any development involving a prospective material adverse effect, in the condition, financial or otherwise, or in the earnings, business or operations of the Guarantor and its consolidated Subsidiaries taken as a whole.

 

“Material Subsidiary” means, at any time, any Subsidiary of the Guarantor which at such time is a “Significant Subsidiary” under Regulation S-X of the Exchange Act.  The Material Subsidiaries as of the date hereof are set forth on Schedule 1.1 hereto.

 

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency business.

 

“Note Register” means the register of Notes, maintained by the Registrar, pursuant to Section 2.03 hereof.

 

“Notes” means the collective reference to the Initial Notes and the Subsequent Notes.

 

“Obligations” has the meaning ascribed to it in Section 10.01 hereof.

 

“Officer” means the Chairman of the Board of Directors, the Chief Executive Officer, the President, the Chief Financial Officer, any Vice President, the Treasurer, the Controller or the Secretary of the Company or the Guarantor, as applicable.

 

“Officer’s Certificate” means a certificate signed by an Officer or attorney-in-fact of the Company or the Guarantor, as applicable.

 

“Opinion of Counsel” means a written opinion from legal counsel, which counsel may be an employee of or counsel to the Company, who shall be acceptable to the Trustee.  The form and substance of such Opinion of Counsel shall likewise be acceptable to the Trustee.

 

“Pari Passu Indebtedness” means Indebtedness for borrowed money, the proceeds of which are used to either purchase interests in the Series 2002-1 VFC, refinance Indebtedness originally used for such purpose and/or pay expenses incurred in connection with this Indenture or any such other Indebtedness, and indebtedness incurred in connection with Hedge Agreements, in each case which ranks not greater than pari passu (in priority of payment) with the Notes.

 

6

 

“Paying Agent” means the Person (including the Company, the Guarantor or any Subsidiary) authorized by the Company to pay the principal of (or premium, if any) or interest, if any, on any Notes on behalf of the Company.

 

“Permitted Indebtedness” means (a) Indebtedness of the Company under the Notes and (b) Pari Passu Indebtedness.

 

“Permitted Liens” means:

 

(1)                                  Liens for current taxes, assessments or other governmental charges which are not delinquent or remain payable without any penalty, or the validity of which is contested in good faith by appropriate proceedings upon stay of execution of the enforcement thereof or upon posting a bond in connection therewith;

 

(2)                                  any Lien pursuant to any order or attachment or similar legal process arising in connection with court proceedings; provided that the execution or other enforcement thereof is effectively stayed or a sufficient bond had been posted and the claims secured thereby are being contested at the time in good faith by appropriate proceedings;

 

(3)                                  any Liens securing bonds posted with respect to and in compliance with clauses (1) and (2) above;

 

(4)                                  any Liens securing the claims of mechanics, laborers, workmen, repairmen, materialmen, suppliers, carriers, warehousemen, landlords, or vendors or other claims provided for by mandatory provisions of law which are not yet due and delinquent, or are being contested in good faith by appropriate proceedings;

 

(5)                                  any Lien on any Restricted Property securing Indebtedness incurred or assumed solely for the purpose of financing all or any part of the cost of constructing or acquiring such Restricted Property, which Lien attaches to such Restricted Property concurrently with or within 120 days after construction, acquisition or completion of a series of related acquisitions thereof;

 

(6)                                  Liens existing immediately prior to the execution and delivery of this Indenture (and listed on Schedule 3.4 hereto);

 

(7)                                  Liens to secure bonds posted in order to obtain stays of judgments, attachments or orders, the existence of which bonds would not otherwise constitute an Event of Default;

 

(8)                                  Liens on Restricted Property or with respect to the shares of stock or Indebtedness of any Restricted Subsidiary, that either (i) existed prior to the acquisition of (A) such Restricted Property, (B) any Subsidiary that is the owner of such Restricted Property or (C) with respect to the shares of stock or Indebtedness of any Restricted Subsidiary, any such Restricted Subsidiary, or (ii) arises as a result of contractual commitments to grant a Lien relating to (A) such Restricted Property, (B) any Subsidiary that is the owner of such Restricted Subsidiary or (C) with respect to the shares of stock or Indebtedness of any Restricted Subsidiary, any such Restricted Subsidiary, in each of (A), (B) and (C) existing prior to such acquisition;

 

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(9)                                  Liens created by a Restricted Subsidiary in favor of the Company, the Guarantor or a Subsidiary;

 

(10)                            Liens on any accounts receivable from or invoices to export customers (including, but not limited to, Subsidiaries) and the proceeds thereof;

 

(11)                            Liens on rights under contracts to sell, purchase or receive commodities to or from export customers (including, but not limited to, Subsidiaries) and the proceeds thereof;

 

(12)                            Liens on cash deposited as collateral in connection with financings where Liens are permitted under clause (10) and (11) of this definition;

 

(13)                            Liens extending, renewing or replacing, in whole or in part Liens permitted pursuant to (i) clauses (1) through (5) and (7) through (12), so long as the principal amount of the Indebtedness secured by such Lien does not exceed its original principal amount and (ii) in the case of clause (6), so long as the principal amount of the Indebtedness secured by such Lien does not exceed the principal amount thereof outstanding immediately prior to the execution and delivery of the Indenture;

 

(14)                            minor survey exceptions or minor encumbrances, easements or reservations, or rights of others for rights-of-way, utilities and other similar purposes, or zoning or other restrictions as to the use of real properties that constitute Restricted Property, which are necessary for the conduct of the activities of the Guarantor or any Restricted Subsidiary or which customarily exist on properties of corporations engaged in similar activities and similarly situated and which do not in any event materially impair their use in the operation of the business of the Guarantor or any Restricted Subsidiary;

 

(15)                            Liens on accounts receivable and other related assets arising in connection with transfers thereof to the extent such transfers are treated as true sales of financial assets under FASB Statement No. 166, and such accounts receivable and related assets are not consolidated on the consolidated financial statements of the Guarantor and its Subsidiaries under FASB Statement No. 167;

 

(16)                            Liens on intercompany loans made to the Guarantor or its Subsidiaries or on any notes or other instruments representing an interest in such intercompany loans in each case as set forth in the Master Trust Transaction Documents;

 

(17)                            Liens securing obligations under a Hedge Agreement or swap, cap or collar agreement or similar arrangement related to equities or commodities;

 

(18)                            Liens on any checking account, saving account, clearing account, futures account, deposit account, securities account, brokerage account, custody account or other account (or on any assets held in such account), securing obligations under any agreement or arrangement related to the opening of or provision of clearing, pooling, zero-balancing, brokerage, settlement, margin or other services related to such account (or on any assets held in such account), which customarily exist on similar accounts (or on any assets held in such accounts) of corporations in connection with the opening of, or provision of clearing, pooling, zero-balancing, brokerage, settlement, margin or other services related, to such accounts; and

 

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(19)                            Liens securing any obligations related to the issuance of a letter of credit or any similar instrument, including without limitation, obligations under reimbursement agreements.

 

For purposes of this definition above, (A) the phrases “accounts receivable from or invoices to export customers” and “contracts to sell, purchase or receive commodities to (from) export customers” shall refer to invoices or accounts receivable derived from the sale of, or contracts to sell, purchase or receive wheat, soybeans or other commodities or products derived from the processing of wheat, soybeans or other commodities, by or to the Guarantor or a Restricted Subsidiary that have been or are to be exported from the country of origin whether or not such sale is made by a Restricted Subsidiary or to any of its Subsidiaries; and (B) property of a party to a corporate reorganization which is not the Guarantor or a Restricted Subsidiary shall be deemed to be or have been “acquired” by the Guarantor or such Restricted Subsidiary as part of such corporate reorganization even if the Guarantor or such Restricted Subsidiary, as the case may be, is not the surviving or continuing entity.

 

“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company, government or any agency or political subdivision hereof or any other entity.

 

“Pooling Agreement” means the Fifth Amended and Restated Pooling Agreement, dated as of June 28, 2004, among Bunge Funding, Inc., Bunge Management Services, Inc., as servicer, and The Bank of New York, in its capacity as Master Trust Trustee, as amended, modified or supplemented from time to time in accordance with its terms, subject to Section 3.02(f) hereof.

 

“Principal Trust Office” means the Corporate Trust Office or such other trust office or agency as may be designated by the Trustee in writing to the Company from time to time.  The initial Principal Trust Office shall be the office of the Trustee to which notices are to be sent as set forth in Section 11.02 hereof.

 

“Property” means any property, whether presently owned or hereafter acquired, including any asset, revenue, or right to receive income or any other property, whether tangible or intangible, real or personal.

 

“Rating Agencies” means (1) Moody’s, S&P and Fitch; and (2) if Moody’s, S&P or Fitch cease to rate the Notes or fails to make a rating of the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by Bunge Limited which shall be substituted for Moody’s, S&P or Fitch, or all of them, as the case may be.

 

“Redemption Date” means, with respect to any redemption of Notes, the date of redemption with respect thereto.

 

“Redemption Price” has the meaning ascribed to it under the section entitled “Optional Redemption by the Company” on the reverse side of the Notes, the forms of which are attached as Exhibits A and B hereto.

 

“Registrar” has the meaning ascribed to it in Section 2.03 hereof.

 

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“Representatives to the Underwriters” means Citigroup Global Markets Inc., J.P. Morgan Securities LLC and RBS Securities Inc.

 

“Restricted Property” means any building, mine, structure or other facility (together with the land on which it is erected and fixtures comprising a part thereof) and inventories now owned or hereafter acquired by the Guarantor or any Subsidiary and used for oilseed or grain origination, processing, transportation or storage, mining or fertilizer refining or storage.

 

“Restricted Subsidiary” means (a) any Subsidiary that has been designated by the Guarantor as eligible for intercompany loans to be made by the master trust under the Master Trust Transaction Documents, (b) any other Subsidiary which is a “significant subsidiary” under Regulation S-X under the Securities Act, or (c) any other Subsidiary that owns or leases any Restricted Property the aggregate Fair Market Value of which, as determined by the Board of Directors of the Guarantor, exceeds three percent of Consolidated Net Tangible Assets.

 

“Sale-Leaseback Transaction” means the sale or transfer by the Guarantor or any Restricted Subsidiary of any Restricted Property to a Person (other than the Guarantor or a Restricted Subsidiary) and the taking back by the Guarantor or any Restricted Subsidiary, as the case may be, of a lease of such Restricted Property.

 

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business, and any successor to its rating agency business.

 

“SEC” means the U.S. Securities and Exchange Commission.

 

“Securities Act” means the U.S. Securities Act of 1933, as amended.

 

“Securities Custodian” means the custodian with respect to the Global Note (as appointed by DTC), or any successor Person thereto and shall initially be the Trustee.

 

“Series 2002-1 Supplement” means the Fourth Amended and Restated Series 2002-1 Supplement to the Pooling Agreement, dated as of February 15, 2008, among the Company, Bunge Funding, Inc., Bunge Management Services, Inc. and the Master Trust Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, subject to Section 3.02(f) hereof.

 

“Series 2002-1 VFC” means the interest in the Bunge Master Trust created and authorized pursuant to a supplement to the Pooling Agreement that is designated as the “Series 2002-1 VFC Certificate” in which the Company will acquire a beneficial interest with the net proceeds of the Notes and other Permitted Indebtedness.

 

“Servicing Agreement” means the Third Amended and Restated Servicing Agreement, dated as of December 23, 2003 among Bunge Funding, Inc., Bunge Management Services, Inc., as the servicer, and The Bank of New York, in its capacity as the Master Trust Trustee, as the same may be amended, supplemented or otherwise modified from time to time in accordance with its terms, subject to Section 3.02(f) hereof.

 

“Special Interest Payment Date” has the meaning ascribed to it in Section 2.11 hereof.

 

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“Special Record Date” has the meaning ascribed to it in Section 2.11 hereof.

 

“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but shall not include any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.

 

“Subsequent Notes” has the meaning ascribed to it in the second introductory paragraph of this Indenture.

 

“Subsidiary” means any corporation, limited liability company or other business entity of which the requisite number of shares of stock or other equity ownership interests having ordinary voting power (without regard to the occurrence of any contingency) to elect a majority of the directors, managers or trustees thereof, or any partnership of which more than 50% of the partners’ equity interests (considering all partners’ equity interests as a single class) is, in each case, at the time owned or controlled, directly or indirectly, by a Person, one or more of the Subsidiaries of such Person, or combination thereof.

 

“Successor Guarantor” has the meaning ascribed to it in Section 4.01 hereof.

 

“Trust Indenture Act” means the U.S. Trust Indenture Act of 1939, as in effect on the date of this Indenture, except as provided in Section 9.03 hereof.

 

“Trust Officer” means, with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the individuals who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such individual’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

 

“Trustee” means the party named as such in this Indenture until a successor replaces it and, thereafter, such successor.

 

“Underwriters” means, collectively, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, RBS Securities LLC, BNP Paribas Securities Corp., HSBC Securities (USA) Inc., SG Americas Securities, LLC, Credit Agricole Securities (USA) Inc., ING Financial Markets LLC, Mitsubishi UFJ Securities (USA), Inc. and Standard Chartered Bank.

 

“U.S. GAAP” means generally accepted accounting principles in the United States, as in effect on the Issue Date.

 

“U.S. Government Securities” means securities that are (a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not 

 

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callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S. Government Securities or a specific payment of principal of or interest on any such U.S. Government Securities held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Securities or the specific payment of principal of or interest on the U.S. Government Securities evidenced by such depository receipt.

 

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

 

Section 1.02.  Incorporation by Reference of Trust Indenture Act.  This Indenture is subject to the mandatory provisions of the Trust Indenture Act which are incorporated by reference in and made a part of this Indenture.  The following Trust Indenture Act terms have the following meanings:

 

“Commission” means the SEC.

 

“indenture securities” means the Notes.

 

“indenture security holder” means a Noteholder.

 

“indenture to be qualified” means this Indenture.

 

“indenture trustee” or “institutional trustee” means the Trustee.

 

“obligor” on the indenture securities means the Company and any other obligor on the indenture securities.

 

All other Trust Indenture Act terms used in this Indenture that are defined by the Trust Indenture Act, defined in the Trust Indenture Act by reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.

 

Section 1.03.  Rules of Construction.  Unless the context otherwise requires:

 

(1)                                  a term has the meaning assigned to it;

 

(2)                                  an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. GAAP as in effect on the Issue Date;

 

(3)                                  “or” is not exclusive;

 

(4)                                  “including” means including without limitation;

 

(5)                                  words in the singular include the plural and words in the plural include the singular; and

 

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(6)                                  the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date and prepared in accordance with U.S. GAAP.

 

ARTICLE 2
 THE NOTES

 

Section 2.01.  Form, Dating and Terms.  (a)  The Initial Notes are being offered and sold by the Company pursuant to an Underwriting Agreement, dated March 8, 2011 among the Company, the Guarantor and Representatives to the Underwriters.

 

The Initial Notes offered and sold to the Underwriters will be issued on the Issue Date in the form of a permanent global Note, without interest coupons, substantially in the form of Exhibit A hereto, which is hereby incorporated by reference and made a part of this Indenture, including appropriate legends as set forth in Section 2.01(c) hereof (the “Global Note”), deposited with the Trustee, as custodian for DTC, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  The Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate.  The aggregate principal amount of the Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.

 

Except as described in the succeeding two sentences, the principal of and premium, if any, and interest on the Notes shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.03 hereof; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Notes represented by a Global Note (including principal, premium and interest) will be made by wire transfer of immediately available funds to the accounts specified by DTC.  Payments in respect of Notes represented by Definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least U.S.$1,000,000 aggregate principal amount of Notes represented by Definitive Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

 

Any Subsequent Notes shall be in the form of Exhibit A hereto.

 

The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage, in addition to those set forth on Exhibit A hereto and in Section 2.01(c) hereof.  The Company and the Trustee shall approve the forms of the Notes and any notation, endorsement or legend on them.  Each Note shall be dated the date of its authentication.  The terms of the Notes set forth in Exhibit A hereto are part of the terms of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to be bound by such terms.

 

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The Notes shall be subject to repurchase by the Company pursuant to a Change of Control Offer as provided in Section 3.15 hereof.  The Notes shall not be redeemable, other than as provided in Article V.

 

(b)                                 Denominations.  The Notes shall be issuable only in fully registered form, without coupons, and only in denominations of U.S.$1,000 and any integral multiple thereof.

 

(c)                                  Legends.  Each of the Global Notes, whether or not an Initial Note, shall bear the following legend on the face thereof:

 

“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE.”

 

(d)                                 Book-Entry Provisions.  (i) This Section 2.01(d) shall apply only to Global Notes deposited with the Trustee, as custodian for DTC.

 

(ii)                                  Each Global Note initially shall (A) be registered in the name of DTC or the nominee of DTC, (B) be delivered to the Trustee as custodian for DTC and (C) bear legends as set forth in Section 2.01(c) hereof.

 

(iii)                               Members of, or participants in, DTC (“Agent Members”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by DTC or by the Trustee as the custodian of DTC or under such Global Note, and DTC may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Note for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as between DTC and its Agent Members, the operation of customary practices of DTC governing the exercise of the rights of a Holder of a beneficial interest in any Global Note.

 

(iv)                              In connection with any transfer of a portion of the beneficial interest in a Global Note pursuant to Section 2.01(e) hereof to beneficial owners who are required to hold Definitive Notes, the Securities Custodian shall reflect on its books and records the 

 

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date and a decrease in the principal amount of such Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to be transferred, and the Company shall execute, and the Trustee shall authenticate and deliver, one or more Definitive Notes of like tenor and amount.

 

(v)                                 In connection with the transfer of an entire Global Note to beneficial owners pursuant to Section 2.01(e) hereof, such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by DTC in exchange for its beneficial interest in such Global Note, an equal aggregate principal amount of Definitive Notes of authorized denominations.

 

(vi)                              The registered Holder of a Global Note may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Notes.

 

(e)                                  Definitive Notes.

 

(i)                                     Except as provided below, owners of beneficial interests in Global Notes will not be entitled to receive Definitive Notes.  If required to do so pursuant to any applicable law or regulation, beneficial owners may obtain Definitive Notes in exchange for their beneficial interests in a Global Note upon written request in accordance with DTC’s and the Registrar’s procedures.  In addition, Definitive Notes shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Note if (a) DTC notifies the Company that it is unwilling or unable to continue as depositary for such Global Note or DTC ceases to be a clearing agency registered under the Exchange Act, at a time when DTC is required to be so registered in order to act as depositary, and in each case a successor depositary is not appointed by the Company within 90 days of such notice, or (b) subject to the procedures of DTC, the Company or the Guarantor executes and delivers to the Trustee and Registrar an Officer’s Certificate stating that such Global Note shall be so exchangeable or (c) an Event of Default has occurred and is continuing and the Registrar has received a request from DTC.

 

(ii)                                  In connection with the exchange of a portion of a Definitive Note for a beneficial interest in a Global Note, the Trustee shall cancel such Definitive Note, and the Company shall execute, and the Trustee shall authenticate and deliver, to the transferring Holder a new Definitive Note representing the principal amount not so transferred.

 

Section 2.02.  Execution and Authentication.  One Officer shall execute the Notes, on behalf of the Company, by manual or facsimile signature.  If an Officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.

 

A Note shall not be valid until an authorized signatory of the Trustee manually authenticates the Note.  The signature of the Trustee on a Note shall be conclusive evidence that 

 

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such Note has been duly and validly authenticated and issued under this Indenture.  A Note shall be dated the date of its authentication.

 

The Trustee shall authenticate and make available for delivery: (1) at any time and from time to time after the execution and delivery of this Indenture, the Initial Notes for original issue on the Issue Date initially in an aggregate principal amount of U.S. $500,000,000; and (2) if and when issued, the Subsequent Notes, in each case upon a written order of the Company signed by two Officers or by an Officer and an Assistant Treasurer or an Assistant Secretary of the Company (the “Company Order”).  Such Company Order shall specify the amount of the Notes to be authenticated and the date on which the original issue of Notes is to be authenticated and whether the Notes are to be Initial Notes or Subsequent Notes.  The aggregate principal amount of Notes which may be authenticated and delivered under this Indenture is initially limited to U.S. $500,000,000 outstanding (plus any Subsequent Notes), except for Notes authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Notes of the same class pursuant to Section 2.06, Section 2.07, Section 2.09, Section 5.08 or Section 9.05 hereof.  All Notes issued on the Issue Date and all Subsequent Notes shall be identical in all respects other than issue date, issue price and the date from which interest accrues and any changes relating thereto; provided that if the Subsequent Notes are not fungible with the Initial Notes for United States federal income tax purposes, the Subsequent Notes will have a separate CUSIP number.  Notwithstanding anything to the contrary contained in this Indenture, the Initial Notes and any Subsequent Notes of the same class will be treated as a single class of securities under this Indenture.  Without limiting the generality of the foregoing sentence, unless otherwise provided in this Indenture, all Notes issued under this Indenture shall vote and consent together on all matters as one class and no Notes will have the right to vote or consent as a separate class on any matter.

 

The Trustee may appoint an agent (the “Authenticating Agent”) reasonably acceptable to the Company to authenticate the Notes.  Unless limited by the terms of such appointment, any such Authenticating Agent may authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent.  An Authenticating Agent has the same rights as a Paying Agent to deal with Holders or an Affiliate of the Company.

 

Section 2.03.  Registrar and Paying Agent.  The Company shall cause to be kept a register for the Notes (the “Note Register”) in which, subject to such reasonable regulations as the Company may prescribe, the Company shall provide for the registration of the Notes and of all transfers and exchanges with respect thereto.  The Note Register shall be maintained by the Trustee or such other Person (including the Company or the Guarantor) appointed by the Company as the registrar (the “Registrar”).  The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange and an office or agency where Notes may be presented for payment (the “Place of Payment”).  The Company shall cause each of the Registrar and the Paying Agent to maintain an office or agency in the Borough of Manhattan, The City of New York.  The Company may have one or more co-registrars and one or more additional paying agents.  The term “Paying Agent” includes any additional paying agent.

 

The Company shall enter into an appropriate agency agreement with any Registrar and Paying Agent that is not a party to this Indenture, which shall incorporate the terms of the Trust 

 

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Indenture Act.  The agreement shall implement the provisions of this Indenture that relate to such agent.  The Company shall notify the Trustee of the name and address of each such agent.  If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.07 hereof.  The Company, the Guarantor or any Subsidiary of the Company or the Guarantor may act as Paying Agent, Registrar, co registrar or transfer agent.

 

The Company initially appoints DTC to act as depository with respect to the Global Notes.  The Trustee is authorized to enter into a letter of representations with DTC in the form provided to the Trustee by the Company and to act in accordance with such letter.

 

The Company initially appoints the Trustee as Registrar and Paying Agent for the Notes.

 

Section 2.04.  Paying Agent to Hold Money in Trust.  By at least 10:00 a.m. (New York City time) on the date on which any principal of and premium, if any, or interest on any Note is due and payable, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal, premium, if any, or interest when due.  The Company shall require each Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for the benefit of Noteholders or the Trustee all money held by such Paying Agent for the payment of principal of and premium, if any, or interest on the Notes and shall notify the Trustee in writing of any default by the Company or the Guarantor in making any such payment.  If the Company, the Guarantor or a Subsidiary of the Company or the Guarantor acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund.  The Company at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee and to account for any funds disbursed by such Paying Agent.  Upon complying with this Section 2.04, the Paying Agent (if other than the Company or a Subsidiary of the Company or the Guarantor) shall have no further liability for the money delivered to the Trustee.  Upon any bankruptcy, reorganization or similar proceeding with respect to the Company, the Trustee shall serve as Paying Agent for the Notes.

 

Section 2.05.  Noteholder Lists.  The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Noteholders and shall otherwise comply with Trust Indenture Act, Section 312(a).  If the Trustee is not the Registrar, or to the extent otherwise required under the Trust Indenture Act, the Company, on its own behalf and on behalf of the Guarantor, shall furnish to the Trustee, in writing at least seven Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Noteholders and the Company shall otherwise comply with Trust Indenture Act, Section 312(a).

 

Section 2.06.  Transfer and Exchange.

 

(a)                                  The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.01 hereof or this Section 2.06.  The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable prior written notice to the Registrar.

 

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(b)                                 Obligations with Respect to Transfers and Exchanges of Notes.

 

(i)                                     To permit registrations of transfers and exchanges, the Company shall, subject to the other terms and conditions of this Article 2, execute and the Trustee shall authenticate Definitive Notes and Global Notes at the Registrar’s or co-registrar’s request.

 

(ii)                                  No service charge shall be made to a Holder for any registration of transfer or exchange, but the Company or the Guarantor may require from a Holder payment of a sum sufficient to cover any transfer tax, assessments, or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant to Section 3.15 and Section 9.05 hereof).

 

(iii)                               The Registrar or co-registrar shall not be required to register the transfer of, or exchange of, any Note for a period beginning (1) 15 days before the mailing of a notice of an offer to repurchase or redeem Notes and ending at the close of business on the day of such mailing or (2) 15 days before an interest payment date and ending on such interest payment date.

 

(iv)                              Prior to the due presentation for registration of transfer of any Note, the Company, the Trustee, the Paying Agent, the Registrar or any co-registrar may deem and treat the person in whose name a Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and premium, if any, and interest on such Note and for all other purposes whatsoever, whether or not such Note is overdue, and none of the Company, the Trustee, the Paying Agent, the Registrar or any co registrar shall be affected by notice to the contrary.

 

(v)                                 All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt, and shall be entitled to the same benefits under this Indenture, as the Notes surrendered upon such transfer or exchange.

 

(vi)                              All Global Notes shall be registered in the name of DTC, or a nominee thereof, and all transfers of beneficial ownership interests therein will be made in accordance with the rules of DTC.  No investor or other party purchasing, selling or otherwise transferring beneficial ownership interests in Global Notes shall receive, hold or deliver any certificate representing the same.  The Company, the Guarantor and the Trustee shall have no responsibility or liability for transfers of beneficial ownership interests in any Global Note.

 

(c)                                  No Obligation of the Trustee.

 

(i)                                     The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Note, an Agent Member or any other Person with respect to (A) the accuracy of the records of DTC or its nominee or of any participant or member thereof, with respect to any ownership interest in the Notes, (B) the delivery to any participant, member, beneficial owner or other Person (other than DTC) of any notice (including any notice of redemption) or the payment of any amount or delivery of any Notes (or other 

 

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security or property) under or with respect to such Notes, or (C) the selection of the particular Notes or portions thereof to be redeemed or refunded in the event of a partial redemption or refunding of the Notes.  All notices and communications to be given to the Holders and all payments to be made to Holders in respect of the Notes shall be given or made only to or upon the order of the registered Holders (which shall be DTC or its nominee in the case of a Global Note).  The rights of beneficial owners in any Global Note shall be exercised only through DTC subject to the applicable rules and procedures of DTC.  The Trustee may rely and shall be fully protected in relying upon information furnished by DTC with respect to its members, participants and any beneficial owners.

 

(ii)                                  The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers between or among DTC, its Agent Members or beneficial owners in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture with respect to transfers between Holders, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

Section 2.07.  Mutilated, Destroyed, Lost or Stolen Notes.  If a mutilated Note is surrendered to the Registrar or if the Holder of a Note claims that the Note has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Note if the requirements of Section 8-405 of the New York Uniform Commercial Code are met and the Holder satisfies any other reasonable requirements of the Trustee.  Such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss which any of them may suffer if a Note is replaced, and, in the absence of notice to the Company, the Guarantor or the Trustee that such Note has been acquired by a bona fide purchaser, the Company shall execute and upon Company Order the Trustee shall authenticate and make available for delivery, in exchange for any such mutilated Note or in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount, bearing a number not contemporaneously outstanding.

 

In case any such mutilated, destroyed, lost or stolen Note has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Note, pay such Note.

 

Upon the issuance of any new Note under this Section 2.07, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) in connection therewith.

 

Every new Note issued pursuant to this Section 2.07 in lieu of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Company, the Guarantor (if applicable) and any other obligor upon the Notes, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to 

 

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all benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder.

 

The provisions of this Section 2.07 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.

 

Section 2.08.  Outstanding Notes.  Notes outstanding at any time are all Notes authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section 2.08 as not outstanding.  A Note ceases to be outstanding in the event the Company holds the Note, provided, however, that (i) for purposes of determining which are outstanding for consent or voting purposes hereunder, Notes shall cease to be outstanding in the event the Company or an Affiliate of the Company holds the Note and (ii) in determining whether the Trustee shall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Notes are present at a meeting of Holders of Notes for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Notes which a Trust Officer of the Trustee actually knows to be held by the Company or an Affiliate of the Company shall not be considered outstanding.

 

If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Note is held by a bona fide purchaser.

 

If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a redemption date or maturity date money sufficient to pay all principal, premium, if any, and interest payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Noteholders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.

 

Section 2.09.  Temporary Notes.  Until Definitive Notes are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Notes.  Temporary Notes shall be substantially in the form of Definitive Notes but may have variations that the Company considers appropriate for temporary Notes.  Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Definitive Notes.  After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at any office or agency maintained by the Company for that purpose and such exchange shall be without charge to the Holder.  Upon surrender for cancellation of any one or more temporary Notes, the Company shall execute, and the Trustee shall authenticate and make available for delivery in exchange therefor, one or more Definitive Notes representing an equal principal amount of Notes.  Until so exchanged, the Holder of temporary Notes shall in all respects be entitled to the same benefits under this Indenture as a holder of Definitive Notes.

 

Section 2.10.  Cancellation.  The Company at any time may deliver Notes to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Notes

 

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surrendered to them for registration of transfer, exchange or payment.  The Trustee, and no one else, shall cancel and dispose of all Notes surrendered for registration of transfer, exchange, payment or cancellation, in its customary manner.  The Company may not issue new Notes to replace Notes it has paid or delivered to the Trustee for cancellation for any reason other than in connection with a transfer or exchange.

 

Section 2.11.  Payment of Interest; Defaulted Interest.  Interest on any Note which is payable, and is punctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Note (or one or more predecessor Notes) is registered at the close of business on the regular record date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 2.03 hereof.

 

Any interest on any Note which is payable, but is not paid when the same becomes due and payable and such nonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder on the regular record date by virtue of having been such Holder, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Notes (such defaulted interest and interest thereon herein collectively called “Defaulted Interest”) shall be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:

 

(a)                                  The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on a Special Record Date (as defined below) for the payment of such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date (not less than 30 days after such notice) of the proposed payment (the “Special Interest Payment Date”), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a record date (the “Special Record Date”) for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the Special Interest Payment Date and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company of such Special Record Date, and in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor to be given in the manner provided for in Section 11.02 hereof, not less than 10 days prior to such Special Record Date.  Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (b).

 

(b)                                 The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, if, after notice 

 

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given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section 2.11, each Note delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.

 

Section 2.12.  Computation of Interest.  Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months.

 

Section 2.13.  CUSIP and ISIN Numbers.  The Company in issuing the Notes may use “CUSIP” and “ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP” and “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or omission of such CUSIP or ISIN numbers.  The Company shall promptly notify the Trustee in writing of any change in the CUSIP and ISIN numbers.

 

Section 2.14.  Tax Treatment.  The Company and each holder and beneficial owner intend, and will take all actions consistent with the intention, that the Notes be treated as indebtedness for all federal, state, local, and foreign income and franchise tax purposes.  The Company, by entering into this Indenture, and each holder and beneficial owner, by its acceptance of its Note, agree to treat the Notes as indebtedness for federal, state, local and foreign income and franchise tax purposes.

 

ARTICLE 3
 COVENANTS

 

Section 3.01.  Payment of Notes.  The Company shall promptly pay the principal of and premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes and in this Indenture.  Principal and interest shall be considered paid on the date due if on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Noteholders on that date.

 

The Company shall pay interest on overdue principal and premium, if any, at the rate specified therefor in the Notes, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.

 

Notwithstanding anything to the contrary contained in this Indenture and subject to Section 11.15, the Company may, to the extent it is required to do so by law, deduct or withhold income or other taxes imposed by the United States of America (or any political subdivision thereof) from principal or interest payments hereunder.

 

Section 3.02.  Limitation and Restrictions on Activities of the Company.  (a) The 

 

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Company shall not engage in any business or enterprise or enter into or be a party to any transaction or agreement other than in connection with (i) the issuance and sale of the Notes, (ii) the incurrence of other Permitted Indebtedness, (iii) the entering into of Hedge Agreements relating to the Notes or the other Permitted Indebtedness having a notional amount not exceeding the aggregate principal amount of the Notes and such other Permitted Indebtedness then outstanding and (iv) the use of the net proceeds from the issuance of the Notes or the other Permitted Indebtedness to either increase its investment in the Series 2002-1 VFC, repay the Notes or other Permitted Indebtedness outstanding from time to time or pay expenses incurred in connection with such Permitted Indebtedness.

 

(b)                                 The Company shall not acquire or own any subsidiary or other assets or property (either real or personal), except for (i) the Series 2002-1 VFC, (ii) Hedge Agreements, and (iii) instruments evidencing the interests in the foregoing.

 

(c)                                  The Company shall not create, incur, assume or suffer to exist any Indebtedness other than Permitted Indebtedness.

 

(d)                                 The Company shall not create, assume, incur or suffer to exist any Lien (other than Company Permitted Liens) upon or with respect to any of its Property; provided, however, it being understood, for the avoidance of doubt, that the Company shall not create, incur, assume or suffer to exist any Lien, including any Lien which would otherwise constitute a Permitted Lien in the case of the Guarantor or any Restricted Subsidiary, other than Company Permitted Liens.

 

(e)                                  The Company shall not enter into any consolidation, merger, amalgamation, joint venture, syndicate or other form of combination with any Person, and shall not sell, lease, convey or otherwise dispose of any of its assets or receivables, including, without limitation, the Series 2002-1 VFC or any interest in the Series 2002-1 VFC.

 

(f)                                    The Company shall not amend, supplement, waive or modify, or consent to any amendment, supplement, waiver or modification of, any Master Trust Transaction Document except in accordance with the provisions of this Section 3.02(f).  Any provision of any Master Trust Transaction Document may be amended, waived, supplemented, restated, discharged or terminated without the consent of the Holders so long as in each case, the Trustee shall have received prior notice thereof together with copies of any documentation related thereto; provided that such amendment, waiver, supplement or restatement does not (i) render the Series 2002-1 VFC subordinate in payment to any other Series under the Bunge Master Trust or otherwise adversely discriminate against the Series 2002-1 VFC relative to any other Series under the Bunge Master Trust, (ii) reduce in any manner the amount of, or delay the timing of, distributions which are required to be made on or in respect of the Series 2002-1 VFC, (iii) change the definition of, the manner of calculating, or in any way the amount of, the interest of the Company in the assets of the Bunge Master Trust, (iv) change the definition of “Eligible Loans” or, to the extent used in such definition, other defined terms used in such definition, (v) result in a Default or Event of Default, or (vi) terminate the Bunge Master Trust with respect to less than all of the then outstanding Series issued by the Bunge Master Trust; and provided, further, that, the Bunge Master Trust may be terminated at any time with respect to all Series then outstanding without the consent of the Holders.  Any amendment, waiver, supplement or 

 

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restatement of a Master Trust Transaction Document (including any exhibit thereto) of the type described in clauses (i), (ii), (iii), (iv), (v) or (vi) of this Section 3.02(f) shall require the written consent of the Holders of at least a majority in principal amount of the Notes then outstanding, including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes.

 

Section 3.03.  Limitation on Liens.  The Guarantor shall not, and shall not permit any Restricted Subsidiary to, create, assume, incur or suffer to exist any Lien, other than a Permitted Lien, upon or with respect to any Restricted Property or upon any shares of stock or Indebtedness of any Restricted Subsidiary, to secure any Indebtedness incurred or guaranteed by the Guarantor or any Restricted Subsidiary (other than the Notes), unless all of the outstanding Notes and the Guarantee are secured equally and ratably with, or prior to, such Indebtedness for so long as such Indebtedness shall be so secured.

 

Section 3.04.  Limitation on Sale-Leaseback Transactions.  The Guarantor shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale-Leaseback Transaction unless:

 

(a)                                  the Sale-Leaseback Transaction occurs within six months from the date of the acquisition of the Restricted Property subject thereto or the date of the completion of construction or commencement of full operations of such Restricted Property, whichever is later; or

 

(b)                                 the Sale-Leaseback Transaction is between the Guarantor and a Restricted Subsidiary of the Guarantor, or between Restricted Subsidiaries of the Guarantor; or

 

(c)                                  the Sale-Leaseback Transaction involves a lease for a period, including renewals, of not more than three years; or

 

(d)                                 the Sale-Leaseback Transaction constitutes a Permitted Lien for the purposes of Section 3.03 hereof; or

 

(e)                                  the Guarantor or such Restricted Subsidiary, within a one year period after such Sale-Leaseback Transaction, (i) applies or causes to be applied an amount not less than the Attributable Indebtedness from such Sale-Leaseback Transaction to the prepayment, repayment, redemption, reduction or retirement of any Indebtedness of the Guarantor or any Subsidiary having a maturity of more than one year that is not subordinated to the Notes or the Guarantee or (ii) enters into a bona fide commitment to expend an amount not less than the Attributable Indebtedness for such Sale-Leaseback Transaction during such one-year period to the acquisition, construction or development of other similar Property.

 

Section 3.05.  Exclusion from Limitations.  Notwithstanding Sections 3.03 and 3.04 hereof, the Guarantor may, and may permit any Restricted Subsidiary to, create, assume, incur or suffer to exist any Lien (other than a Permitted Lien) upon any Restricted Property or the shares of stock or Indebtedness of any Restricted Subsidiary to secure Indebtedness incurred or guaranteed by the Guarantor or any Restricted Subsidiary (other than the Notes) or effect any Sale-Leaseback Transaction of a Restricted Property that is not excepted by Section 3.04(a), (b), (c), (d) or (e) hereof, without equally and ratably securing the Notes or the Guarantee provided that, after giving effect thereto, the aggregate principal amount of outstanding Indebtedness 

 

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(other than the Notes) secured by Liens (other than Permitted Liens) upon Restricted Property and the shares of stock or Indebtedness of any Restricted Subsidiary plus the Attributable Indebtedness from Sale-Leaseback Transactions of Restricted Property not so excepted, do not exceed 20% of the Consolidated Net Tangible Assets.

 

Section 3.06.  Maintenance of Office or Agency.  The Company will maintain in The City of New York, an office or agency where the Notes may be presented or surrendered for payment, where, if applicable, the Notes may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served.  The office or agency (the “Corporate Trust Office”) used by the Trustee in The City of New York as its office or agency for receiving securities, as the same may from time to time be designated by the Trustee, shall be such office or agency of the Company, unless the Company shall designate and maintain some other office or agency for one or more of such purposes.  The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.

 

The Company may also from time to time designate one or more other offices or agencies (in or outside of The City of New York) where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in The City of New York for such purposes.  The Company will give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such other office or agency.

 

Section 3.07.  Corporate Existence.  Subject to Article 4 hereof, each of the Company and the Guarantor will do or cause to be done all things necessary to preserve, renew and keep in full force and effect its corporate existence and take all reasonable action to maintain its corporate rights (charter and statutory), licenses, privileges and franchises; provided, however, that the Company and the Guarantor shall not be required to preserve any such right, license, privilege or franchise if the Board of Directors of the Company or the Guarantor, as applicable, shall determine that the preservation thereof is no longer desirable in the conduct of its business and that the loss thereof is not, and will not be, disadvantageous in any material respect to the Holders; and provided further, the Guarantor may amalgamate or merge in accordance with Section 4.01 hereof.

 

Section 3.08.  Maintenance of Properties; Insurance.  The Guarantor shall, and shall cause each of its Subsidiaries to, keep all property useful and necessary in its business in good working order and condition, except where failure to do so would not have a Material Adverse Effect; and the Guarantor shall maintain with financially sound and reputable insurance companies insurance on all its property in at least such amounts and against at least such risks as are customary for the Guarantor’s type of business.

 

Section 3.09.  Payment of Taxes and Other Claims.  Each of the Company and the 

 

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Guarantor shall pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all federal income and other material taxes, assessments and similar governmental charges imposed on it, except where (i) the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves to the extent required by U.S. GAAP with respect thereto have been provided on the books of the Company or the Guarantor or (ii) the nonpayment of such federal income and other material taxes, assessments and claims in the aggregate could not reasonably be expected to have a Material Adverse Effect.

 

Section 3.10.  Payments for Consent.  Neither the Company, the Guarantor nor any Subsidiaries of the Company or the Guarantor will, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fees or otherwise, to any Holder of any Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid or is paid to all Holders of the Notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

 

Section 3.11.  Compliance Certificate.  The Company and the Guarantor shall deliver to the Trustee within 120 days after the end of each Fiscal Year of the Company and the Guarantor a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company and the Guarantor, respectively, stating that in the course of the performance by the signer of his or her duties as an officer of the Company and the Guarantor he or she would normally have knowledge of any Default or Event of Default and whether or not the signer knows of any Default or Event of Default that occurred during such period.  If he or she does, the certificate shall describe the Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto.  The Company also shall comply with Trust Indenture Act, Section 314(a)(4).

 

Section 3.12.  Further Instruments and Acts.  Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

 

Section 3.13.  Statement by Officers as to Default.  The Company shall deliver to the Trustee, as soon as possible and in any event within 10 days after the Company becomes aware of the occurrence of any Event of Default or an event which, with notice or the lapse of time or both, would constitute an Event of Default, an Officer’s Certificate setting forth the details of such Event of Default or default and the action which the Company proposes to take with respect thereto.

 

Section 3.14.  Notice of Change in Bermuda Law, Debt Ratings.  The Guarantor shall give written notice to the Trustee promptly after becoming aware of (i) any changes in taxes, duties or other fees of Bermuda or any political subdivision or taxing authority thereof or any change in any laws of Bermuda, in each case, that may affect any payment due under this Indenture, (ii) any change in such Guarantor’s public or private debt ratings by a “nationally recognized statistical rating organization,” as such term is defined by the SEC for purposes of Rule 436(g)(2) under the Securities Act, and (iii) any development or event which has had, or which the Guarantor in its good faith judgment believes will have, a Material Adverse Effect; 

 

26

 

provided that the Trustee shall have no responsibilities or duties with respect to any such notice.  Delivery of any such notice to the Trustee is for informational purposes only and the Trustee’s receipt of such notice shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officer’s Certificates).

 

Section 3.15.  Offer to Repurchase Upon Change of Control.  (a)  If a Change of Control Triggering Event occurs, unless the Company has previously or concurrently irrevocably exercised its right to redeem all the outstanding Notes as described under Section 5.05 hereof without such redemption being subject to any conditions precedent, the Company shall make an offer to purchase all of the Notes pursuant to the offer described below (the “Change of Control Offer”) at a price in cash (the “Change of Control Payment”) equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to, but excluding, the date of purchase, subject to the right of Holders of the Notes of record on the relevant record date to receive interest due on the relevant interest payment date.  Within 60 days following any Change of Control Triggering Event, the Company shall send notice of such Change of Control Offer by first-class mail, with a copy to the Trustee, to each Holder of Notes to the address of such Holder appearing in the security register or otherwise in accordance with the procedures of DTC with a copy to the Trustee, with the following information:

 

(i)                                     that a Change of Control Offer is being made pursuant to this Section 3.15 and that all Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment by the Company;

 

(ii)                                  the date of the Change of Control Triggering Event;

 

(iii)                               the date, which will be no earlier than 30 days nor later than 60 days from the date such notice is mailed, by which the Company must purchase the Notes (the “Change of Control Payment Date”);

 

(iv)                              the price that the Company must pay for the Notes it is obligated to purchase;

 

(v)                                 the name and address of the Trustee;

 

(vi)                              that any Note not properly tendered will remain outstanding and continue to accrue interest;

 

(vii)                           that unless the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest on the Change of Control Payment Date;

 

(viii)                        that Holders electing to have any Notes purchased pursuant to a Change of Control Offer will be required to surrender such Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of such Notes completed, to the paying agent specified in the notice at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;

 

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(ix)                                that Holders shall be entitled to withdraw their tendered Notes and their election to require the Company to purchase such Notes; provided that the paying agent receives, not later than the close of business on the 30th day following the date of the Change of Control notice, a facsimile transmission or letter setting forth the name of the Holder of the Notes, the principal amount of Notes tendered for purchase, and a statement that such Holder is withdrawing its tendered Notes and its election to have such Notes purchased;

 

(x)                                   that if the Company is repurchasing less than all of the Notes, the Holders of the remaining Notes will be issued new Notes and such new Notes will be equal in principal amount to the unpurchased portion of the Notes surrendered.  The unpurchased portion of the Notes must be equal to $1,000 or an integral multiple of $1,000 in excess thereof; and

 

(xi)                                the other instructions, as determined by the Company, consistent with this Section 3.15, that a Holder must follow.

 

The notice, if mailed in a manner herein provided, shall be conclusively presumed to have been given, whether or not the Holder receives such notice.  If (a) the notice is mailed in a manner herein provided and (b) any Holder fails to receive such notice or a Holder receives such notice but it is defective, such Holder’s failure to receive such notice or such defect shall not affect the validity of the proceedings for the purchase of the Notes as to all other Holders that properly received such notice without defect.  The Company shall comply with all federal and state securities laws, including, specifically, Rule 13e-4, if applicable, under the Exchange Act, and any related Schedule 13E-4 required to be submitted under that rule, to the extent such laws or regulations are applicable in connection with the repurchase of Notes pursuant to a Change of Control Offer.  To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 3.15, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 3.15 by virtue thereof.

 

(b)                                 On the Change of Control Payment Date, the Company shall, to the extent permitted by law,

 

(i)                                     accept for payment all Notes issued by it or portions thereof properly tendered pursuant to the Change of Control Offer,

 

(ii)                                  deposit with the Paying Agent an amount equal to the aggregate Change of Control Payment in respect of all Notes or portions thereof so tendered, and

 

(iii)                               deliver, or cause to be delivered, to the Trustee for cancellation the Notes so accepted together with an Officer’s Certificate to the Trustee stating the aggregate principal amount of such Notes or portions thereof that have been tendered to, and purchased by, the Company.

 

(c)                                  The Company shall not be required to make a Change of Control Offer following a Change of Control Triggering Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in 

 

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this Section 3.15 applicable to a Change of Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer.  Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control Triggering Event, conditional upon such Change of Control Triggering Event, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

 

(d)                                 Other than as specifically provided in this Section 3.15, any purchase pursuant to this Section 3.15 shall be made pursuant to the provisions of Section 5.04, 5.06 and 5.08 hereof.

 

(e)                                  Notwithstanding any provision to the contrary in this Indenture, the Company shall not purchase any Notes if there has occurred and is continuing an Event of Default, unless such Event of Default results from the Company’s failure to pay the Change of Control Payment following the occurrence of a Change of Control Triggering Event.

 

ARTICLE 4
 SUCCESSOR GUARANTOR

 

Section 4.01.  Consolidation, Merger, Amalgamation and Sale of Assets by the Guarantor.  The Guarantor shall not, and shall not cause or permit any Subsidiary to, consolidate with or merge or amalgamate with or into, or sell, lease, or convey all or substantially all its assets to, any Person, unless:

 

(a)                                  in the case of the Guarantor:

 

(i)                                     the resulting, surviving or transferee Person (the “Successor Guarantor”) shall be either the Guarantor or a Person organized under the laws of Bermuda, the United States of America, any State thereof or the District of Columbia, any full member state of the European Union, Canada, Australia or Switzerland, and the Successor Guarantor (if not the Guarantor) shall expressly assume, by supplemental indenture, executed and delivered to the Trustee, all the obligations of the Guarantor under the Guarantee and this Indenture; and

 

(ii)                                  immediately after giving effect to such transaction, no Event of Default or event which with notice or lapse of time would be an Event of Default has occurred and is continuing; or

 

(b)                                 in the case of any Subsidiary of the Guarantor (other than the Company):

 

(i)                                     such transaction is a merger or amalgamation of such Subsidiary with or into, or a consolidation of such Subsidiary with, the Guarantor (so long as the Guarantor is the surviving, continuing or resulting entity) or another Subsidiary or the sale or other disposition by such Subsidiary of all or substantially all of its property to the Guarantor or another Subsidiary; or

 

(ii)                                  such transaction is the merger or amalgamation of such Subsidiary with or into, the consolidation of such Subsidiary with, or the sale or other disposition by 

 

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such Subsidiary of all or substantially all of its property to, another Person (provided that such Person is not an Affiliate of such Subsidiary), so long as immediately prior to, and after giving effect to such transaction, no Default or Event of Default exists or would exist.

 

For purposes of this Section 4.01, the sale, lease, conveyance, assignment, transfer, or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Guarantor, which properties and assets, if held by the Guarantor instead of such Subsidiaries, would constitute all or substantially all of the properties and assets of the Guarantor on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Guarantor.

 

If the Guarantor engages in one of the transactions described above and complies with the conditions listed above, the Successor Guarantor will succeed to, and be substituted for, and may exercise every right and power of, the Guarantor under this Indenture, but, in the case of a lease of all or substantially all its assets, the Guarantor will not be released from the obligation to pay the principal of and premium, if any, and interest on the Notes (including additional amounts).

 

In the event that the Guarantor consolidates with or merges or amalgamates with or into, or sells, leases or conveys all or substantially all of its assets to, another Person subject to the terms of this Section 4.01 (a “Transfer”) and the Successor Guarantor is a Person organized under the laws of a member state of the European Union, Canada, Australia or Switzerland, then the Guarantor and the Successor Guarantor shall, as a condition to such Transfer, (A) enter into a supplemental indenture with the Trustee providing for full, unconditional and irrevocable indemnification of the holders and beneficial owners of the Notes and the Trustee against any tax or duty of whatever nature (other than any tax imposed by reason of the holders or beneficial owners of the Notes having some connection with any such jurisdiction, other than their participation as holders or beneficial owners of the Notes under this Indenture) which is incurred or otherwise suffered by such holders and beneficial owners and the Trustee with respect to the Notes and which would not have been incurred or otherwise suffered in the absence of such Transfer; and (B) deliver to the Trustee, for the benefit of the Holders of the Notes, legal opinions of independent legal counsel in New York and the applicable member state of the European Union, Canada, Australia or Switzerland the laws of which the Successor Guarantor is organized under, as applicable, to the effect that the Obligations of the Successor Guarantor with respect to the Guarantee, as the case may be, are legal, valid, binding and enforceable in accordance with their terms.

 

ARTICLE 5
 OPTIONAL REDEMPTION OF NOTES

 

Section 5.01.  Optional Redemption by the Company.  The Notes may be redeemed at any time as a whole or from time to time in part, subject to the conditions and at the Redemption Prices specified in the form of Notes set forth in Exhibit A hereto, which are hereby incorporated by reference and made a part of this Indenture, together with accrued and unpaid interest to the Redemption Date.

 

Section 5.02.  Applicability of Article.  Redemption of Notes at the election of the 

 

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Company or otherwise, as permitted or required by any provision of this Indenture, shall be made in accordance with such provision and this Article 5.

 

Section 5.03.  Election to Redeem; Notice to Trustee.  The election of the Company to redeem any Notes pursuant to Section 5.01 hereof shall be evidenced by a resolution of the Board of Directors of the Company.  In case of any redemption at the election of the Company, the Company shall, upon not later than the earlier of the date that is 30 days prior to the Redemption Date fixed by the Company or the date on which notice is given to the Holders (except as provided in Section 5.05 hereof or unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Notes to be redeemed and shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Notes to be redeemed pursuant to Section 5.04 hereof.

 

Section 5.04.  Selection by Trustee of Notes to Be Redeemed.  If less than all the Notes are to be redeemed at any time pursuant to an optional redemption, the particular Notes to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the outstanding Notes not previously called for redemption, in compliance with the requirements of the principal securities exchange, if any, on which such Notes are listed, or, if such Notes are not so listed, on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate, which shall comply with the procedures of DTC and which may provide for the selection for redemption of portions of the principal of the Notes; provided, however, that no such partial redemption shall reduce the portion of the principal amount of a Note not redeemed to less than U.S. $1,000.

 

The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Notes selected for partial redemption, the principal amount thereof to be redeemed.

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to redemption of Notes shall relate, in the case of any Note redeemed or to be redeemed only in part, to the portion of the principal amount of such Note which has been or is to be redeemed.

 

Section 5.05.  Notice of Redemption.  Notice of redemption shall be given in the manner provided for in Section 11.02 hereof not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Notes to be redeemed.  The Trustee shall give notice of redemption in the Company’s name and at the Company’s expense; provided, however, that the Company shall deliver to the Trustee, at least 15 days prior to the date the notice of redemption is to be given (unless a shorter period shall be acceptable to the Trustee), an Officer’s Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the following items.

 

All notices of redemption shall state:

 

(1)                                  the Redemption Date,

 

(2)                                  the Redemption Price and the amount of accrued interest to the Redemption Date payable as provided in Section 5.07 hereof, if any,

 

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(3)                                  if less than all outstanding Notes are to be redeemed, the identification of the particular Notes (or portion thereof) to be redeemed, as well as the aggregate principal amount of Notes to be redeemed and the aggregate principal amount of Notes to be outstanding after such partial redemption,

 

(4)                                  in case any Note is to be redeemed in part only, the notice which relates to such Note shall state that on and after the Redemption Date, upon surrender of such Note, the Holder will receive, without charge, a new Note or Notes of authorized denominations for the principal amount thereof remaining unredeemed,

 

(5)                                  that on the Redemption Date the Redemption Price (and accrued interest, if any, to the Redemption Date payable as provided in Section 5.07 hereof) will become due and payable upon each such Note, or the portion thereof, to be redeemed, and, unless the Company defaults in making the redemption payment, that interest on Notes called for redemption (or the portion thereof) will cease to accrue on and after said date,

 

(6)                                  the place or places where such Notes are to be surrendered for payment of the Redemption Price and accrued interest, if any,

 

(7)                                  the name and address of the Paying Agent,

 

(8)                                  that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price,

 

(9)                                  the CUSIP number, and that no representation is made as to the accuracy or correctness of the CUSIP number, if any, listed in such notice or printed on the Notes, and

 

(10)                            any conditions applicable to such redemption.

 

Section 5.06.  Deposit of Redemption Price.  Prior to 10:00 A.M. (New York City time) on any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 2.04 hereof) an amount of money sufficient to pay the Redemption Price of, and accrued interest on, all the Notes which are to be redeemed on that date.

 

Section 5.07.  Notes Payable on Redemption Date.  Notice of redemption having been given as aforesaid, the Notes to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified (together with accrued interest, if any, to the Redemption Date), and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Notes shall cease to bear interest.  Upon surrender of any such Note for redemption in accordance with said notice, such Note shall be paid by the Company at the Redemption Price, together with accrued interest, if any, to the Redemption Date (subject to the rights of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).

 

If any Note called for redemption shall not be so paid upon surrender thereof for redemption, the principal and premium, if any, shall, until paid, bear interest from the Redemption Date at the rate borne by the Notes.

 

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Section 5.08.  Notes Redeemed in Part.  Any Note which is to be redeemed only in part (pursuant to the provisions of this Article 5) shall be surrendered at the office or agency of the Company maintained for such purpose pursuant to Section 3.05 hereof (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Note at the expense of the Company, a new Note or Notes, of any authorized denomination as requested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Note so surrendered, provided that each such new Note will be in a principal amount of U.S.$1,000 or integral multiple thereof.  Notwithstanding the foregoing, DTC shall select the Notes for redemption if evidenced by a Global Note according to DTC’s stated procedures therefor.

 

ARTICLE 6
 DEFAULTS AND REMEDIES

 

Section 6.01.  Events of Default.  With respect to the Notes, an “Event of Default” occurs if:

 

(1)                                  the Company defaults in any payment of interest on any Note when the same becomes due and payable, and such default continues for a period of 30 days;

 

(2)                                  the Company defaults in the payment of the principal or premium, if any, on any Note when the same becomes due and payable at its Stated Maturity, upon optional redemption, upon declaration of acceleration or otherwise;

 

(3)                                  the Company or the Guarantor defaults in the performance of or a breach by the Company or the Guarantor of any other covenant or agreement in this Indenture or under any Note (other than those referred to in (1) or (2) above) and such default continues for 60 days after written notice from the Trustee or the Holders of at least 25% in principal amount of the outstanding Notes;

 

(4)                                  the Company, the Guarantor or any Subsidiary shall (i) default in making any payment of any principal of any indebtedness for borrowed money, including obligations evidenced by any mortgage, indenture, bond, debenture, note, guarantee or other similar instruments to which it is a party on the scheduled or original due date with respect thereto; or (ii) default in making any payment of any interest on any such indebtedness beyond the period of grace, if any, provided in the instrument or agreement under which such indebtedness was created; or (iii) default in the observance or performance of any other agreement or condition relating to any such indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, the effect of which default or condition is to cause, or to permit the holder or beneficiary of such indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such indebtedness to become due prior to its stated maturity or (in the case of any such indebtedness constituting a guarantee) to become payable and such acceleration has not been cured within 15 days after notice of acceleration; provided, that a default, event or condition described in clause (i), (ii) or (iii) of this

 

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paragraph (4) shall not at any time constitute an Event of Default unless, at such time, one or more defaults, events or conditions of the type described in clauses (i), (ii) and (iii) of this paragraph (4) shall have occurred and be continuing with respect to such indebtedness in an amount exceeding U.S. $50,000,000; or

 

(5)                                  (i) the Company, the Guarantor, a Designated Obligor or any Material Subsidiary shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Company, the Guarantor, a Designated Obligor or any Material Subsidiary shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against the Company, the Guarantor, a Designated Obligor or any Material Subsidiary any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against the Company, the Guarantor, a Designated Obligor or any Material Subsidiary any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) the Company, the Guarantor, a Designated Obligor or any Material Subsidiary shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the Company, the Guarantor, a Designated Obligor or any Material Subsidiary shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due.

 

The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

 

The Company shall deliver to the Trustee, within 10 days after becoming aware of the occurrence thereof, written notice in the form of an Officer’s Certificate of any Default or Event of Default under clauses (3), (4) or (5) of this Section 6.01, which such notice shall contain the status thereof and a description of the action being taken or proposed to be taken by the Company in respect thereof.

 

Section 6.02.  Acceleration.  (a) If an Event of Default occurs and is continuing with respect to the Notes, the Trustee by written notice to the Company, or the Holders of at least 25% in outstanding principal amount of the Notes by written notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of and premium, if any, and accrued and unpaid interest on all the Notes to be due and payable.  Upon such a declaration, such principal, premium, if any, and accrued and unpaid interest shall be immediately due and payable.  If an Event of Default described in paragraph (5) of Section 6.01

 

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hereof occurs and is continuing with respect to the Notes, then in each and every such case, the principal amount of the Notes, the premium, if any, and all accrued and unpaid interest on all the Notes shall be immediately due and payable without any declaration or other act on the part of the Trustee or the Holders.

 

(b)                                 In the event the principal of and premium, if any, and accrued and unpaid interest on the Notes becomes due and payable pursuant to Section 6.02(a) hereof, the Trustee shall instruct the Company, and the Company shall instruct the Master Trust Trustee, to declare due and payable the principal and accrued interest in respect of the intercompany loans that had been made using the net proceeds from the sale of such Notes invested in the Series 2002-1 VFC.

 

Section 6.03.  Other Remedies.  If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal of and premium, if any, or interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture.

 

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Noteholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative.

 

Section 6.04.  Waiver of Past Defaults.  The Holders of a majority in aggregate principal amount of the outstanding Notes that have been accelerated (voting as a single class) by notice to the Trustee may (a) waive, by their consent (including, without limitation consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes), an existing Default or Event of Default and its consequences with respect to the Notes except (i) a Default or Event of Default in the payment of the principal of and premium, if any, or interest on a Note or (ii) a Default or Event of Default in respect of a provision that under Section 9.02 hereof cannot be amended without the consent of each Noteholder affected and (b) rescind any such acceleration with respect to the Notes and its consequences if (1) rescission would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, other than the nonpayment of the principal of and premium, if any, and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived.  When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right.

 

Section 6.05.  Control by Majority.  The Holders of a majority in principal amount of the outstanding Notes may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee.  However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or, subject to Section 7.01 and Section 7.02 hereof, that the Trustee determines is unduly prejudicial to the rights of other Noteholders or would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction.  Prior to taking any action hereunder, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

 

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Section 6.06.  Limitation on Suits.  Subject to Section 6.07 hereof, a Noteholder may not pursue any remedy with respect to this Indenture or any of the Notes unless:

 

(1)                                  the Holder gives to the Trustee written notice stating that an Event of Default is continuing;

 

(2)                                  the Holders of at least 25% in outstanding principal amount of the Notes make a request to the Trustee to pursue the remedy;

 

(3)                                  such Holder or Holders offer to the Trustee security or indemnity satisfactory to the Trustee against any loss, liability or expense;

 

(4)                                  the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and

 

(5)                                  the Holders of a majority in principal amount of the Notes do not give the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such request during such 60-day period.

 

A Noteholder may not use this Indenture to prejudice the rights of another Noteholder or to obtain a preference or priority over another Noteholder (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances are unduly prejudicial to such Noteholders).

 

Section 6.07.  Rights of Holders to Receive Payment.  Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.06 hereof), the right of any Holder to receive payment of principal of and premium, if any, or interest on the Notes held by such Holder, on or after the respective due dates expressed in the Notes (including in connection with a Change of Control Offer), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.

 

Section 6.08.  Collection Suit by Trustee.  If an Event of Default specified in Section 6.01 (1) or (2) hereof occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount then due and owing (together with interest on any unpaid interest to the extent lawful) and the amounts provided for in Section 6.07 hereof.

 

Section 6.09.  Trustee May File Proofs of Claim.  The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Noteholders allowed in any judicial proceedings relative to the Company, the Guarantor, any of the Subsidiaries or their respective creditors or properties and, unless prohibited by law or applicable regulations, may be entitled and empowered to participate as a member of any official committee of creditors appointed in such matter and, may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to

 

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pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.07 hereof.

 

Section 6.10.  Priorities.  If the Trustee collects any money or property pursuant to this Article 6, it shall pay out the money or property in the following order:

 

FIRST:  to the Trustee for amounts due under Section 7.07 hereof;

 

SECOND:  to Noteholders for amounts due and unpaid on the Notes for principal and premium, if any, and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal and interest, respectively; and

 

THIRD:  to the Company.

 

The Trustee may fix a record date and payment date for any payment to Noteholders pursuant to this Section 6.10.  At least 15 days before such record date, the Company shall mail to each Noteholder and the Trustee a notice that states the record date, the payment date and amount to be paid.

 

Section 6.11.  Undertaking for Costs.  In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section 6.11 does not apply to a suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to Section 6.07 hereof or a suit by Holders of more than 10% in outstanding principal amount of the Notes.

 

ARTICLE 7
 TRUSTEE

 

Section 7.01.  Duties of Trustee.  (a) If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs; provided that if an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against loss, liability or expense.

 

Except during the continuance of an Event of Default:

 

(1)                                  the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

 

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(2)                                  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

 

(b)                                 The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:

 

(1)                                  this paragraph does not limit the effect of the second paragraph of Section 7.01(a);

 

(2)                                  the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

 

(3)                                  the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof.

 

(c)                                  Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs Section 7.01(a) and (b) hereof.

 

(d)                                 The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.

 

(e)                                  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

 

(f)                                    No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(g)                                 Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.01 and to the provisions of the Trust Indenture Act.

 

(h)                                 Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of the Company.

 

(i)                                     The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to it against the costs, expenses (including reasonable attorneys’ fees and expenses) and liabilities that might be incurred by it in compliance with such request or direction.

 

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Section 7.02.  Rights of Trustee.  Subject to Section 7.01 hereof:

 

(a)                                  The Trustee may conclusively rely on any document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper person.  The Trustee need not investigate any fact or matter stated in the document.  The Trustee shall receive and retain financial reports and statements of the Company as provided herein, but shall have no duty to review or analyze such reports or statements to determine compliance under covenants or other obligations of the Company;

 

(b)                                 Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate and/or an Opinion of Counsel.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officer’s Certificate or Opinion of Counsel;

 

(c)                                  The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care;

 

(d)                                 The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers, provided however, that the Trustee’s conduct does not constitute willful misconduct or negligence;

 

(e)                                  The Trustee may consult with counsel of its selection, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Notes shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel;

 

(f)                                    The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Principal Trust Office of the Trustee, and such notice references the Notes and this Indenture;

 

(g)                                 The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder (including Registrar and Paying Agent), and each agent, custodian and other Person employed to act hereunder;

 

(h)                                 The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded;

 

(i)                                     The Trustee is not required to give any bond or surety with respect to the performance of its duties or the exercise of its powers under this Indenture;

 

(j)                                     The Trustee’s rights, powers, indemnities, immunities and protections from liability and its rights to compensation and indemnification in connection with the performance of its duties under this Indenture shall extend to (1) the Trustee, whether serving in any other

 

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capacity hereunder, including without limitation, in the capacity of Paying Agent or Registrar and (2) the Trustee’s officers, directors, agents, counsel and employees.  Such immunities and protections and rights to indemnification, together with the Trustee’s right to compensation, shall survive the Trustee’s resignation or removal, the discharge of this Indenture and final payment of the Notes;

 

(k)                                  The Trustee shall have no responsibility for any information in any offering document or other disclosure material distributed with respect to the Notes, and the Trustee shall have no responsibility for compliance with any state or federal securities laws in connection with the Notes, other than the filing of any documents required to be filed by an indenture trustee pursuant to the Trust Indenture Act or otherwise required in this Indenture;

 

(l)                                     Notwithstanding anything else herein contained, whenever any provision of this Indenture indicates that any confirmation of a condition or event is qualified by the words “to the knowledge of” or “known to” the Trustee or other words of similar meaning, said words shall mean and refer to the current awareness of one or more Trust Officers who are located at the Principal Trust Office of the Trustee or who are otherwise responsible for administering the trusts created under this Indenture;

 

(m)                               The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled, during regular business hours and upon providing reasonable advance notice to the Company, to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation; and

 

(n)                                 In no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

Section 7.03.  Individual Rights of Trustee.  The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.  Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights.  However, the Trustee must comply with Section 7.10 and Section 7.11 hereof.  In addition, the Trustee shall be permitted to engage in transactions with the Company; provided, however, that if the Trustee acquires any conflicting interest the Trustee must (i) eliminate such conflict within 90 days of acquiring such conflicting interest, (ii) apply to the Commission for permission to continue acting as Trustee or (iii) resign.

 

Section 7.04.  Trustee’s Disclaimer.  The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, shall not be accountable for the Company’s use of the proceeds from the Notes, shall not be responsible for

 

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the use or application of any money received by any Paying Agent other than the Trustee and shall not be responsible for any statement of the Company in this Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than the Trustee’s certificate of authentication.

 

Section 7.05.  Notice of Defaults.  If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall mail to each Noteholder at the address set forth in the Note Register notice of the Default or Event of Default within 90 days after it occurs.  Except in the case of a Default or Event of Default in payment of principal of and premium, if any, or interest on any Note (including payments pursuant to the optional redemption or required repurchase provisions of such Note, if any), the Trustee may withhold the notice if and so long as the Trustee in good faith determines that withholding the notice is in the interests of Noteholders.

 

Section 7.06.  Report by Trustee to Holders.  Within 60 days after each February 15 beginning with the February 15 following the date of this Indenture, and in any event prior to April 15 in each year, the Trustee shall mail to each Noteholder a brief report dated as of such February 15 that complies with Trust Indenture Act, Section 313(a), but only if required under such Section.  The Trustee also shall comply with Trust Indenture Act, Section 313(b).  The Trustee shall also transmit by mail all reports required by Trust Indenture Act, Section 313(c).

 

A copy of each report at the time of its mailing to Noteholders shall be filed with the SEC and each stock exchange (if any) on which the Notes are listed.  The Company agrees to notify promptly the Trustee in writing whenever the Notes become listed on any stock exchange and of any delisting thereof.

 

Section 7.07.  Compensation and Indemnity.  The Company shall pay to the Trustee such compensation for its acceptance of this Indenture and for its services hereunder as Trustee, Paying Agent, Registrar and in all other capacities in which it is serving hereunder as the Company and the Trustee shall from time to time agree in writing.  The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, costs of preparing and reviewing reports, certificates and other documents, costs of preparation and mailing of notices to Noteholders and reasonable costs of counsel retained by the Trustee, in addition to the compensation for its services.  Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s agents, counsel, accountants and experts.  The Company shall indemnify the Trustee, and any predecessor Trustee and their respective officers, directors, employees, counsel and agents, against any and all loss, liability, damages, claims or expense (including reasonable attorneys’ fees and expenses) incurred by it without negligence or willful misconduct on its part in connection with the administration of this trust or the performance of its duties hereunder, including the costs and expenses of enforcing this Indenture (including this Section 7.07) and of defending itself against any claims (whether asserted by any Noteholder, the Company or otherwise).  The Trustee shall notify the Company promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder.  The Company shall defend the claim and the Trustee may have separate counsel and the Company shall pay the fees and expenses of such counsel, provided that the

 

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Company shall not be required to pay such fees and expenses if it assumes the obligation for defending the Trustee, and, in the reasonable judgment of the Trustee, there is no conflict of interest between the Company and the Trustee in connection with such action and there is no defense that could not be adequately raised if the Company assumes such obligation.  The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful misconduct or negligence.

 

To secure the Company’s payment obligations in this Section 7.07, the Trustee shall have a lien prior to the Notes on all money or property held or collected by the Trustee other than money or property held in trust to pay principal of and premium, if any, and interest on particular Notes.  Such lien shall survive the satisfaction and discharge of this Indenture.  The Trustee’s right to receive payment of any amounts due under this Section 7.07 shall not be subordinate to any other liability or Indebtedness of the Company.

 

The Company’s payment obligations pursuant to this Section 7.07 shall survive the discharge of this Indenture.  When the Trustee incurs expenses after the occurrence of a Default specified in Section 6.01(5) hereof with respect to the Company, the expenses are intended to constitute expenses of administration under any bankruptcy law.

 

Section 7.08.  Replacement of Trustee.  The Trustee may resign at any time by so notifying the Company.  The Holders of a majority in principal amount of the Notes (voting as a single class) may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee.  The Company shall remove the Trustee if:

 

(1)                                  the Trustee fails to comply with Section 7.10 hereof;

 

(2)                                  the Trustee is adjudged bankrupt or insolvent;

 

(3)                                  a receiver or other public officer takes charge of the Trustee or its property; or

 

(4)                                  the Trustee otherwise becomes incapable of acting.

 

If the Trustee resigns or is removed by the Company or by the Holders of a majority in principal amount of the Notes (voting as a single class) and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of the Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee.

 

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  The successor Trustee shall mail a notice of its succession to Noteholders.  The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.07 hereof.

 

If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee or the Holders of 10% in principal amount of the

 

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Notes may petition, at the Company’s expense, any court of competent jurisdiction for the appointment of a successor Trustee.

 

If the Trustee fails to comply with Section 7.10 hereof, any Noteholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

 

Notwithstanding the replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee.

 

Section 7.09.  Successor Trustee by Merger.  If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.

 

In case at the time such successor or successors by merger, conversion, consolidation or transfer of assets to the Trustee shall succeed to the trusts created by this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor to the Trustee.

 

Section 7.10.  Eligibility; Disqualification.  The Trustee shall at all times satisfy the requirements of Trust Indenture Act, Section 310(a).  The Trustee shall have a combined capital and surplus of at least U.S. $50,000,000 as set forth in its most recent filed annual report of condition.  The Trustee shall comply with Trust Indenture Act, Section 310(b); provided, however, that there shall be excluded from the operation of Trust Indenture Act, Section 310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Company are outstanding if the requirements for such exclusion set forth in Trust Indenture Act, Section 310(b)(1) are met.

 

Section 7.11.  Preferential Collection of Claims Against Company.  The Trustee shall comply with Trust Indenture Act, Section 311(a), excluding any creditor relationship listed in Trust Indenture Act, Section 311(b).  A Trustee who has resigned or been removed shall be subject to Trust Indenture Act, Section 311(a) to the extent indicated.

 

Section 7.12.  Trustee’s Application for Instruction from the Company.  Any application by the Trustee for written instructions from the Company may, at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective.  The Trustee shall not be liable for any action taken by, or omission of, the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than three Business Days after the date any officer of the Company actually receives such application, unless any such officer shall have consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an

 

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omission), the Trustee shall have received written instructions in response to such application specifying the action to be taken or omitted.

 

ARTICLE 8
 DISCHARGE OF INDENTURE; DEFEASANCE

 

Section 8.01.  Discharge of Liability on Notes; Defeasance.  (a) Subject to Section 8.01(b) hereof, when (i)(x) the Company delivers to the Trustee all outstanding Notes (other than Notes replaced pursuant to Section 2.07 hereof) for cancellation or (y) all outstanding Notes not theretofore delivered for cancellation have become due and payable, whether at maturity or upon redemption or will become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name and at the expense of the Company and the Company or the Guarantor irrevocably deposits or causes to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders money in U.S. dollars, non-callable U.S. Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment of interest to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Trustee for cancellation for principal and premium, if any, and accrued interest to the date of maturity or redemption, (ii) no Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or the Guarantor is a party or by which the Company or the Guarantor is bound; (iii) the Company or the Guarantor has paid or caused to be paid all sums payable by it under this Indenture and the Notes; and (iv) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of such Notes at maturity or the Redemption Date, as the case may be, then the Trustee shall acknowledge satisfaction and discharge of this Indenture on demand of the Company (accompanied by an Officer’s Certificate and an Opinion of Counsel stating that all conditions precedent specified herein relating to the satisfaction and discharge of this Indenture have been complied with) and at the cost and expense of the Company.

 

(b)                                 Subject to Section 8.01(c) and Section 8.02 hereof, the Company at any time may terminate (i) all its obligations under the Notes and this Indenture (“legal defeasance option”), and after giving effect to such legal defeasance, any omission to comply with such obligations shall no longer constitute a Default or Event of Default or (ii) its obligations under, Section 3.02, Section 3.03, Section 3.04, Section 3.05, Section 3.08, Section 3.09 and Section 3.15 hereof, and the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document, and the operation of Section 6.01(3) (only with respect to the covenants terminated pursuant to this Section 8.01(b)(ii)), Section 6.01(4) and Section 6.01(5) hereof, and the events specified in such Sections shall no longer constitute an Event of Default (clause (ii) being referred to as the “covenant defeasance option”), but except as specified above, the remainder of this Indenture and the Notes shall be unaffected thereby.  The Company may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. If the Company exercises its covenant defeasance option, the Company may elect to have the Guarantee terminate.

 

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If the Company exercises its legal defeasance option with respect to the Notes, payment of the Notes may not be accelerated because of an Event of Default, and the Guarantee shall terminate.  If the Company exercises its covenant defeasance option with respect to the Notes, payment of the Notes may not be accelerated because of an Event of Default specified in Section 6.01(3) (only with respect to the covenants terminated pursuant to Section 8.01(b)(ii) above), Section 6.01(4) and Section 6.01(5) hereof.

 

Upon satisfaction of the conditions set forth herein and upon request of the Company, the Trustee shall acknowledge in writing the discharge of those obligations that the Company terminates.

 

(c)                                  Notwithstanding the provisions of Section 8.01(a) and (b) hereof, the Company’s obligations in Section 2.02, Section 2.03, Section 2.04, Section 2.05, Section 2.06, Section 2.07, Section 2.08, Section 2.09, Section 2.10, Section 3.01, Section 3.06, Section 3.07, Section 3.10, Section 3.11, Section 3.12, Section 3.13, Section 3.14, Section 3.15, Section 6.07, Section 7.07, Section 7.08 hereof and in this Article 8 shall survive until the Notes have been paid in full.  Thereafter, the Company’s obligations in Section 7.07, Section 8.04 and Section 8.05 hereof shall survive.

 

Section 8.02.  Conditions to Defeasance.  The Company may exercise its legal defeasance option or its covenant defeasance option with respect to the Notes only if:

 

(1)                                  the Company irrevocably deposits in trust with the Trustee for the benefit of the Holders money in U.S. dollars or U.S. Government Securities or a combination thereof for the payment of principal of and premium, if any, and interest on the Notes to maturity or redemption, as the case may be;

 

(2)                                  the Company delivers to the Trustee a certificate from a firm of independent accountants expressing their opinion that the payments of principal and interest when due and without reinvestment on the deposited U.S. Government Securities plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal and interest when due on all the Notes to maturity;

 

(3)                                  no Default or Event of Default shall have occurred and be continuing on the date of such deposit or, with respect to certain bankruptcy or insolvency Events of Default, on the 91st day after such date of deposit;

 

(4)                                  such legal defeasance or covenant defeasance shall not result in a breach or violation of, or constitute a Default under, this Indenture or any other material agreement or instrument to which the Company, the Guarantor or any of its Subsidiaries is a party or by which the Company, the Guarantor or any of its Subsidiaries is bound;

 

(5)                                  the Company shall have delivered to the Trustee an Opinion of Counsel (subject to customary assumptions and exclusions) to the effect that (A) the Notes and (B) assuming no intervening bankruptcy of the Company between the date of deposit and the 91st day following the deposit and that no Holder of the Notes is an insider of the Company, after the 91st day following the deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ right generally;

 

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(6)                                  the deposit does not constitute a default under any other agreement binding on the Company;

 

(7)                                  the Company delivers to the Trustee an Opinion of Counsel (subject to customary assumptions and exclusions) to the effect that the trust resulting from the deposit does not constitute, or is qualified as, a regulated investment company under the U.S. Investment Company Act of 1940, as amended;

 

(8)                                  in the case of the legal defeasance option, the Company shall have delivered to the Trustee an Opinion of Counsel (subject to customary assumptions and exclusions) in the United States stating that (i) the Company has received from, or there has been published by, the U.S. Internal Revenue Service a ruling, or (ii) since the date of this Indenture there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the beneficial owners of the Notes will not recognize income, gain or loss for federal income tax purposes as a result of such defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred;

 

(9)                                  in the case of the covenant defeasance option, the Company shall have delivered to the Trustee an Opinion of Counsel (subject to customary assumptions and exclusions) in the United States to the effect that the beneficial owners of the Notes will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and covenant defeasance and will be subject to federal income tax on the same amount, in the same manner and at the same times as would have been the case if such deposit and covenant defeasance had not occurred; and

 

(10)                            the Company delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent to the defeasance and discharge of the Notes and this Indenture as contemplated by this Article 8 have been complied with.

 

Section 8.03.  Application of Trust Money.  The Trustee shall hold in trust money or U.S. Government Securities deposited with it pursuant to this Article 8.  It shall apply the deposited money and the money from U.S. Government Securities through the Paying Agent and in accordance with this Indenture to the payment of principal of and premium, if any, and interest on the Notes.

 

Section 8.04.  Repayment to Company.  The Trustee and the Paying Agent shall promptly turn over to the Company upon request any excess money or securities held by them upon payment of all the obligations under this Indenture.

 

Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the payment of principal of and premium, if any, or interest on the Notes that remains unclaimed for two years, and, thereafter, Noteholders entitled to the money must look to the Company for payment as general creditors.

 

Section 8.05.  Indemnity for U.S. Government Securities.  The Company shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against deposited U.S. Government Securities or the principal and interest received on such U.S. Government Securities.

 

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Section 8.06.  Reinstatement.  If the Trustee or Paying Agent is unable to apply any money or U.S. Government Securities in accordance with this Article 8 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the obligations of the Company under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to this Article 8 until such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government Securities in accordance with this Article 8; provided, however, that, if the Company has made any payment of interest on or principal of any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or U.S. Government Securities held by the Trustee or Paying Agent.

 

The Trustee’s rights under this Article 8 shall survive termination of this Indenture and the resignation or removal of the Trustee.

 

ARTICLE 9
 AMENDMENTS

 

Section 9.01.  Without Consent of Holders.  The Company, the Guarantor and the Trustee may amend this Indenture or the Notes without notice to or consent of any Noteholder:

 

(1)                                  to cure any ambiguity, omission, defect or inconsistency;

 

(2)                                  to comply with Article 4 in respect of the assumption by a Successor Guarantor or Successor Issuer of the respective obligation of the Guarantor or the Company under this Indenture;

 

(3)                                  to provide for uncertificated Notes in addition to or in place of certificated Notes; provided, however, that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code or in a manner such that the uncertificated Notes are described in Section 163(f)(2)(B) of the Code;

 

(4)                                  to add guarantees with respect to the Notes;

 

(5)                                  to secure the Notes;

 

(6)                                  to add to the covenants of the Company or the Guarantor for the benefit of the Holders or to surrender any right or power herein conferred upon the Company or the Guarantor;

 

(7)                                  to make any change that does not adversely affect the interests of any Noteholder;

 

(8)                                  to provide for the issuance of any Subsequent Notes; or

 

(9)                                  to comply with any requirement of the SEC in connection with the qualification of this Indenture under the Trust Indenture Act.

 

After an amendment under this Section 9.01 becomes effective, the Company shall mail to Noteholders a notice briefly describing such amendment.  The failure to give such notice to all

 

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Noteholders at the address set forth in the Note Register, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.01.

 

Section 9.02.  With Consent of Holders.  The Company, the Guarantor and the Trustee may amend this Indenture or the Notes without notice to any Noteholder but with the written consent of the Holders of at least a majority in principal amount of the Notes then outstanding, including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes.  However, without the consent of each Noteholder affected, an amendment may not:

 

(1)                                  reduce the percentage in principal amount of outstanding Notes whose Holders must consent to an amendment of this Indenture or the Notes;

 

(2)                                  reduce the percentage in principal amount of outstanding Notes whose Holders must consent to an amendment of provisions of the Master Trust Transaction Documents pursuant to Section 3.02(f) hereof;

 

(3)                                  reduce the stated rate of or extend the stated time for payment of interest on any Note;

 

(4)                                  reduce the principal of, or extend the Stated Maturity of, any Note;

 

(5)                                  reduce the premium payable upon the redemption of any Note as described above under Article 5 hereof or any similar provision, whether through an amendment to or waiver of Article 5 hereof, a definition or otherwise;

 

(6)                                  make any Note payable in money other than that stated in the Note;

 

(7)                                  impair the right of any Holder to receive payment of principal of and premium, if any, and interest on such Holder’s Notes on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s Notes;

 

(8)                                  make any change to the amendment provisions which require each Holder’s consent or to the waiver provisions; or

 

(9)                                  release the Guarantor or modify the Guarantee other than in accordance with the provisions of this Indenture.

 

It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.

 

After an amendment under this Section 9.02 becomes effective, the Company shall mail to Noteholders a notice briefly describing such amendment.  The failure to give such notice to all Noteholders, or any defect therein, shall not impair or affect the validity of an amendment under this Section 9.02.

 

Section 9.03.  Compliance with Trust Indenture Act.  Every amendment to this Indenture

 

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or the Notes shall comply with the Trust Indenture Act as then in effect.

 

Section 9.04.  Revocation and Effect of Consents and Waivers.  A consent to an amendment or a waiver by a Holder of a Note shall bind the Holder and every subsequent Holder of that Note or portion of the Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent or waiver is not made on the Note.  However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Note or portion of the Note if the Trustee receives the notice of revocation before the date the amendment or waiver becomes effective or otherwise in accordance with any related solicitation documents.  After an amendment or waiver becomes effective, it shall bind every Noteholder.  An amendment or waiver shall become effective upon receipt by the Trustee of the requisite number of written consents under Section 9.01 or 9.02 hereof, as applicable.

 

The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Noteholders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture.  If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Noteholders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date.  No such consent shall become valid or effective more than 120 days after such record date.

 

Section 9.05.  Notation on or Exchange of Notes.  If an amendment changes the terms of a Note, the Trustee may require the Holder of the Note to deliver it to the Trustee.  The Trustee may place an appropriate notation on the Note regarding the changed terms and return it to the Holder.  Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Note shall issue and the Trustee shall authenticate a new Note that reflects the changed terms.  Failure to make the appropriate notation or to issue a new Note shall not affect the validity of such amendment.

 

Section 9.06.  Trustee to Sign Amendments.  The Trustee shall sign any amendment authorized pursuant to this Article 9 if the amendment does not affect the rights, duties, protections, privileges, indemnities, powers, liabilities or immunities of the Trustee.  If it does, the Trustee may but need not sign it.  In signing such amendment the Trustee shall be entitled to receive indemnity reasonably satisfactory to it and shall be provided with, and (subject to Sections 7.01 and 7.02 hereof), shall be fully protected in conclusively relying upon an Officer’s Certificate and an Opinion of Counsel stating that such amendment is authorized or permitted by this Indenture, that it conforms to the applicable requirements of the Trust Indenture Act and that such amendment is the legal, valid and binding obligation of the Company and any Guarantors, enforceable against them in accordance with its terms, subject to customary exceptions and complies with the provisions hereof (including Section 9.03 hereof).

 

ARTICLE 10
 GUARANTEE

 

Section 10.01.  Guarantee.  The Guarantor hereby fully, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, to each Holder of the Notes and the

 

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Trustee the full and punctual payment when due, whether at maturity, by acceleration, by redemption or otherwise, of the principal of and premium, if any, and interest on the Notes and all other obligations of the Company under this Indenture, including, without limitation, the obligations of the Company under Section 7.07 hereof (all the foregoing being hereinafter collectively called the “Obligations”).  The Guarantor further agrees (to the extent permitted by law) that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from it, and that it will remain bound under this Article 10 notwithstanding any extension or renewal of any Obligation.

 

The Guarantor waives presentation to, demand of payment from and protest to the Company of any of the Obligations and also waives notice of protest for nonpayment.  The Guarantor waives notice of any default under the Notes or the Obligations.  The obligations of the Guarantor hereunder shall not be affected by (a) the failure of the Trustee or any Holder to assert any claim or demand or to enforce any right or remedy against the Company or any other person under this Indenture, the Notes or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Notes or any other agreement; (d) the release of any security held by any Holder or the Trustee for the Obligations or any of them; or (e) any change in the ownership of the Company.

 

The Guarantor further agrees that the Guarantee herein constitutes a guarantee of payment when due (and not a guarantee of collection) and waives any right to require that any resort be had by any Holder or the Trustee to any security held for payment of the Obligations.

 

The obligations of the Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than payment of the Obligations in full), including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Obligations or otherwise.  Without limiting the generality of the foregoing, the obligations of the Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of any Holder to assert any claim or demand or to enforce any remedy under this Indenture, the Notes or any other agreement, by any waiver or modification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the Obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of the Guarantor or would otherwise operate as a discharge of the Guarantor as a matter of law or equity.

 

The Guarantor further agrees that the Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of and premium, if any, or interest on any of the Obligations is rescinded or must otherwise be restored by any Holder upon the bankruptcy or reorganization of the Company or otherwise.

 

In furtherance of the foregoing and not in limitation of any other right which any Holder has at law or in equity against the Guarantor by virtue hereof, upon the failure of the Company to pay any of the Obligations when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, the Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the

 

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Holders an amount equal to the sum of (i) the unpaid amount of such Obligations then due and owing and (ii) accrued and unpaid interest on such Obligations then due and owing (but only to the extent not prohibited by law).

 

The Guarantor further agrees that, as between the Guarantor, on the one hand, and the Holders, on the other hand, (x) the maturity of the Obligations guaranteed hereby may be accelerated as provided in this Indenture for the purposes of the Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby and (y) in the event of any such declaration of acceleration of such Obligations, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Guarantee.

 

The Guarantor also agrees to pay any and all reasonable costs and expenses (including reasonable attorneys’ fees) incurred by the Trustee or the Holders in enforcing any rights under this Section.

 

Section 10.02.  No Subrogation.  Notwithstanding any payment or payments made by the Guarantor hereunder, the Guarantor shall not be entitled to be subrogated to any of the rights of the Trustee or any Holder against the Company or any collateral security or guarantee or right of offset held by the Trustee or any Holder for the payment of the Obligations, nor shall the Guarantor seek or be entitled to seek any contribution or reimbursement from the Company in respect of payments made by the Guarantor hereunder, until all amounts owing to the Trustee and the Holders, as well as the holders of any other Permitted Indebtedness, by the Company on account of the Obligations are paid in full.  If any amount shall be paid to the Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by the Guarantor in trust for the Trustee and the Holders, segregated from other funds of the Guarantor, and shall, forthwith upon receipt by the Guarantor, be turned over to the Trustee in the exact form received by the Guarantor (duly indorsed by the Guarantor to the Trustee, if required), to be applied against the Obligations.

 

Section 10.03.  Consideration.  The Guarantor has received, or will receive, direct or indirect benefits from the making of the Guarantee.

 

ARTICLE 11
 MISCELLANEOUS

 

Section 11.01.  Trust Indenture Act Controls.  If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the Trust Indenture Act, the provision required by the Trust Indenture Act shall control.  The Guarantor in addition to performing its obligations under the Guarantee shall perform such other obligations as may be imposed upon it with respect to this Indenture under the Trust Indenture Act.

 

Section 11.02.  Notices.  Any notice or communication shall be in writing and (a) delivered in person, (b) sent by a recognized overnight delivery service (with charges prepaid), or (c) sent by telecopy if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), addressed as follows:

 

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If to the Company:

Bunge Limited Finance Corp.

11720 Borman Drive

St. Louis, Missouri 63146

Attention: John Gilsinn

Telephone No: (314) 292-2314

Telecopy: (314) 292-4314

 

with a copy to:

 

Premchand Kanneganti

Telecopy:  (914) 684-3283

 

If to the Guarantor:

 

Bunge Limited

50 Main Street

White Plains, New York  10606

Attention:  Premchand Kanneganti

Telephone:  (914) 684-3365

Telecopy:  (914) 684-3283

 

if to the Trustee:

 

Union Bank, N.A.

551 Madison Avenue, 11th Floor

MC 7-11A-054

New York, New York 10022

Attention: Corporate Trust Department

Telecopy: (212) 646-2000

 

The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

 

Any notice or communication mailed to a registered Noteholder shall be mailed to the Noteholder at the Noteholder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed.

 

Failure to mail a notice or communication to a Noteholder or any defect in it shall not affect its sufficiency with respect to other Noteholders.  If a notice or communication is sent in the manner provided above, it is duly given, whether or not the addressee receives it, except that notices to the Trustee shall be effective only upon receipt.

 

Section 11.03.  Communication by Holders with Other Holders.  Noteholders may communicate pursuant to Trust Indenture Act, Section 312(b) with other Noteholders with respect to their rights under this Indenture or the Notes.  The Company, the Trustee, the Registrar and anyone else shall have the protection of Trust Indenture Act, Section 312(c).

 

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Section 11.04.  Certificate and Opinion as to Conditions Precedent.  Upon any request or application by the Company to the Trustee to take or refrain from taking any action under this Indenture, the Company shall furnish to the Trustee:

 

(1)           an Officer’s Certificate in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of the signer, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

 

(2)           an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

 

Section 11.05.  Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include:

 

(1)           a statement that the individual making such certificate or opinion has read such covenant or condition;

 

(2)           a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(3)           a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)           a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.

 

In giving such Opinion of Counsel, counsel may rely as to factual matters on an Officer’s Certificate or on certificates of public officials.

 

Section 11.06.  When Notes Disregarded.  In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company or by an Affiliate of the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded.  Also, subject to the foregoing, only Notes outstanding at the time shall be considered in any such determination.

 

Section 11.07.  Rules by Trustee, Paying Agent and Registrar.  The Trustee may make reasonable rules for action by, or a meeting of, Noteholders.  The Registrar and the Paying Agent may make reasonable rules for their functions.

 

Section 11.08.  Legal Holidays.  A “Legal Holiday” is a Saturday, a Sunday or other day on which commercial banking institutions are authorized or required to be closed in New York, New York or Hamilton, Bermuda.  If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the

 

53

 

intervening period.  If a regular record date is a Legal Holiday, the record date shall not be affected.

 

Section 11.09.  GOVERNING LAW.  THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

Section 11.10.  No Recourse Against Others.  An incorporator, director, officer, employee, affiliate or stockholder of the Company or the Guarantor, solely by reason of this status, shall not have any liability for any obligations of the Company under the Notes, this Indenture or the Guarantee or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Note, each Noteholder shall waive and release all such liability.  The waiver and release shall be part of the consideration for the issue of the Notes.

 

Section 11.11.  Successors.  All agreements of the Company in this Indenture and the Notes shall bind their respective successors.  All agreements of the Trustee in this Indenture shall bind its successors.

 

Section 11.12.  Consent to Jurisdiction.  The Guarantor irrevocably submits to the non-exclusive jurisdiction of any New York state or U.S. federal court sitting in the Borough of Manhattan, The City of New York, in any action or proceeding relating to its obligations, liabilities or any other matter arising out of or in connection with this Indenture or the Notes.  The Guarantor hereby irrevocably agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York state or U.S. federal court.  The Guarantor also hereby irrevocably waives, to the fullest extent permitted by law, any objection to venue or the defense of an inconvenient forum to the maintenance of any such action or proceeding in any such court.

 

Section 11.13.  Appointment for Agent for Service of Process.  The Guarantor hereby (i) irrevocably designates and appoints its Chief Financial Officer (from time to time) at its principal executive offices at 50 Main Street, White Plains, New York 10606 (the “Authorized Agent”), as its agent upon which process may be served in any suit, action or proceeding described in the first sentence of Section 11.12 hereof and represents and warrants that the Authorized Agent has accepted such designation and (ii) agrees that service of process upon the Authorized Agent and written notice of said service to the Guarantor mailed or delivered to its Secretary at its registered office at 2 Church Street, Hamilton, Bermuda, shall be deemed in every respect effective service of process upon the Guarantor in any such suit or proceeding.  The Guarantor further agrees to take any and all action, including the execution and filing of any and all such documents and instruments, as may be necessary to continue such designation and appointment of the Authorized Agent in full force and effect so long as any of the Notes shall be outstanding.

 

Section 11.14.  Waiver of Immunities.  To the extent that the Guarantor or any of its properties, assets or revenues may have or may hereafter become entitled to, or have attributed to them, any right of immunity, on the grounds of sovereignty, from any legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any court, from service of

 

54

 

process, from attachment upon or prior to judgment, or from attachment in aid of execution of judgment, or from execution of judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Indenture or the Notes, the Guarantor hereby irrevocably and unconditionally, to the extent permitted by applicable law, waives and agrees not to plead or claim any such immunity and consents to such relief and enforcement.

 

Section 11.15.  Additional Amounts.  In the event that payments are required to be made by the Guarantor pursuant to its obligations under the Guarantee, the Guarantor will pay to the Holder of any Note such additional amounts as may be necessary so that every net payment to a holder or beneficial owner of the principal of and premium, if any, and interest on such Note, after deducting or withholding for or on account of any present or future tax, duty, assessment or other similar governmental charge duly imposed by Bermuda, will not be less than the amount provided in that Note to be then due and payable.  The Guarantor will not be required, however, to make any payment of additional amounts for or on account of any such tax imposed by reason of the holder or beneficial owner having some connection with Bermuda, other than its participation as a holder or beneficial owner of a Note.

 

Section 11.16.  Judgment Currency.  If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent permitted by law, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee or any Holder, as the case may be, could purchase U.S. dollars with such other currency in New York City on the Business Day preceding that on which final judgment is given.  The obligation of the Guarantor with respect to any sum due from it to the Trustee or any Holder shall, notwithstanding any judgment in a currency other than U.S. dollars, be discharged only if and to the extent that on the first Business Day following receipt by the Trustee or such Holder, as the case may be, of any sum adjudged to be so due in such other currency, the Trustee or such Holder may in accordance with normal banking procedures purchase U.S. dollars with such other currency.  If the U.S. dollars so purchased are less than the sum originally due to the Trustee or such Holder hereunder, the Guarantor agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee or such Holder against such loss.  If the U.S. dollars so purchased are greater than the sum originally due to the Trustee or such Holder hereunder, the Trustee or such Holder, as the case may be, agrees to pay to the Guarantor an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee or such Holder hereunder.

 

Section 11.17.  No Bankruptcy Petition Against the Company; Liability of the Company.  Each of the Noteholders and the Trustee hereby covenants and agrees that, prior to the date which is one year and one day after the payment in full of the last maturing Note and all other Indebtedness of the Company ranking equal with or junior to the Notes in right of payment, it will not institute against, or join with or assist any other Person in instituting against, the Company, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any applicable insolvency laws.

 

55

 

Notwithstanding any other provision hereof, the sole remedy of any Noteholder, the Trustee or any other Person against the Company in respect of any obligation, covenant, representation, warranty or agreement of the Company under or related to this Indenture or the Notes shall be against the assets of the Company.  Neither the Trustee, nor any Noteholder nor any other Person shall have any claim against the Company to the extent that such assets are insufficient to meet such obligations, covenant, representation, warranty or agreement (the difference being referred to herein as a “shortfall”) and all claims in respect of the shortfall shall be extinguished; provided, however, that the provisions of this Section 11.17 apply solely to the obligations of the Company and shall not extinguish such shortfall or otherwise restrict such Person’s rights or remedies against the Guarantor for purposes of the obligations of the Guarantor to any Person under the Guarantee.

 

The provisions of this Section 11.17 shall survive the termination of this Indenture and the resignation or removal of the Trustee .

 

Section 11.18.  Multiple Originals.  The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.  One signed copy is enough to prove this Indenture.  The exchange of copies of this Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes.  Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

 

Section 11.19.  Qualification of Indenture.  The Company shall qualify this Indenture under the Trust Indenture Act and shall pay all reasonable costs and expenses (including attorneys’ fees and expenses for the Company, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes.  The Trustee shall be entitled to receive from the Company any such Officer’s Certificates, Opinions of Counsel or other documentation as it may reasonably request in connection with any such qualification of this Indenture under the Trust Indenture Act.

 

Section 11.20.  Table of Contents; Headings.  The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

 

Section 11.21         Force Majeure.  In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and also including interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services resulting therefrom; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

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Section 11.22         U.S.A. Patriot Act.  The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee.  The parties to this Indenture agree that they will provide the Trustee with such information as it may reasonably request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.

 

	
 
    	
BUNGE   LIMITED FINANCE CORP., as Issuer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Premchand   Kanneganti
    
	
 
    	
 
    	
Name:
    	
Premchand   Kanneganti
    
	
 
    	
 
    	
Title:
    	
President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
BUNGE   LIMITED, as Guarantor
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Premchand   Kanneganti
    
	
 
    	
 
    	
Name:
    	
Premchand   Kanneganti
    
	
 
    	
 
    	
Title:
    	
Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Carla L. Heiss
    
	
 
    	
 
    	
Name:
    	
Carla   L. Heiss
    
	
 
    	
 
    	
Title:
    	
Assistant   General Counsel and
    
	
 
    	
 
    	
 
    	
Assistant   Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
UNION   BANK, N.A., as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Enrico (BOBBY) Reyes
    
	
 
    	
 
    	
Name:
    	
Enrico   (BOBBY) Reyes
    
	
 
    	
 
    	
Title:
    	
Vice   President
    

 

58

 

EXHIBIT A

 

[FORM OF FACE OF INITIAL NOTE AND SUBSEQUENT NOTE]

 

[Depository Legend, if applicable]

 

	
No. [          ]
    	
Principal   Amount U.S.   $[              ],   as revised by the Schedule of Increases and Decreases in Global Note attached   hereto 

 

CUSIP NO.   [                   ]

ISIN:   [                  ]
    

 

4.10% Senior Notes Due 2016

 

Bunge Limited Finance Corp., a Delaware corporation, promises to pay to CEDE & CO., or registered assigns, the principal sum of U.S.$[                ], as revised by the Schedule of Increases and Decreases in Note attached hereto, on March 15, 2016.

 

Interest Payment Dates: March 15 and September 15

 

Record Dates: March 1 and September 1

 

Additional provisions of this Note are set forth on the reverse side hereof.

 

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

 

	
 
    	
BUNGE   LIMITED FINANCE CORP.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

 

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

 

UNION BANK, N.A.,

as Trustee, certifies that this is one of

the Notes referred to in the Indenture.

 

 

	
By:
    	
 
    	
 
    
	
 
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    
	
Date:                         ,      20    
    	
 
    

 

 

[FORM OF REVERSE SIDE OF INITIAL NOTE AND SUBSEQUENT NOTE]

 

4.10% Senior Note Due 2016

 

1.                                       General

 

Bunge Limited Finance Corp., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), issued the Notes under an Indenture, dated as of March 11, 2011, among the Company, the Guarantor and the Trustee (as such Indenture may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”).  The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the U.S. Trust Indenture Act of 1939 as in effect on the date of the Indenture (the “Trust Indenture Act”).  Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.  The Notes are subject to all such terms, and Noteholders are referred to the Indenture and the Trust Indenture Act for a statement of those terms.

 

The Notes are general unsecured senior obligations of the Company, including (a) U.S. $500,000,000 in aggregate principal amount of 4.10% Notes being offered on the Issue Date (subject to Section 2.07 of the Indenture) and (b) any Subsequent Notes.  The Notes rank equally with all other unsecured and unsubordinated indebtedness of the Company.  This Note is one of the [Initial Notes] [Subsequent Notes] referred to in the Indenture.

 

The Company may from time to time, without the consent of existing Holders, create and issue Subsequent Notes having the same terms and conditions as the Initial Notes in all respects, except for the Issue Date, issue price and first payment of interest thereon.  Subsequent Notes issued in this manner will be consolidated with and will form a single class with the previously outstanding Notes; provided, that if the Subsequent Notes are not fungible with the Initial Notes for United States federal income tax purposes, the Subsequent Notes will have a separate CUSIP number.

 

Except as otherwise provided in the Indenture, the Initial Notes and any Subsequent Notes will be treated as a single class of securities under the Indenture.  The Indenture includes various covenants that limit the ability of the Company, among other things, to engage in any business or transaction, acquire assets or subsidiaries, incur Indebtedness or Liens or enter into any consolidations, mergers, amalgamations or sales of assets. In addition, the Indenture imposes certain limitations on, among other things, (i) the incurrence of Liens by the Guarantor or any Restricted Subsidiary, (ii) Sale-Leaseback Transactions by the Guarantor or any Restricted Subsidiary and (iii) consolidations, mergers, amalgamations and sales of assets of the Guarantor, the Company or any Subsidiary.

 

To guarantee the due and punctual payment of the principal of and premium, if any, and interest on the Notes and all other amounts payable by the Company under the Indenture and the Notes when and as the same shall be due and payable, whether at maturity, by acceleration or otherwise, according to the terms of the Notes and the Indenture, the Guarantor has unconditionally guaranteed such obligations pursuant to the terms of the Indenture.  The

 

 

Guarantee is an unsecured and unsubordinated obligation of the Guarantor and ranks equally with all other unsecured and unsubordinated indebtedness and obligations of the Guarantor.

 

2.                                       Interest

 

The Company promises to pay interest on the principal amount of this Note at the rate per annum shown above.

 

The Company will pay interest semi-annually on March 15 and September 15 of each year commencing September 15, 2011.  Interest on the Notes will accrue from the most recent date to which interest has been paid on the Notes or, if no interest has been paid, from March 11, 2011.  The Company shall pay interest on overdue principal or premium, if any, plus interest on such interest to the extent lawful, at the rate borne by the Notes to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.

 

3.                                       Method of Payment

 

By at least 10:00 a.m. (New York City time) on the date on which any principal of and premium, if any, or interest on any Note is due and payable, the Company shall irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if any, and/or interest.  The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Notes at the close of business on the March 1 or September 1 next preceding the interest payment date even if Notes are cancelled, repurchased or redeemed after the record date and on or before the interest payment date.  Holders must surrender Notes to a Paying Agent to collect principal payments.  The Company will pay principal, premium, if any, and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts.  Except as described in the succeeding two sentences, the principal of and premium, if any, and interest on the Notes shall be payable at the office or agency of the Company maintained for such purpose in The City of New York, or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.03 of the Indenture; provided, however, that, at the option of the Company, each installment of interest may be paid by check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Note Register.  Payments in respect of Notes represented by a Global Note (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the account specified by The Depository Trust Company.  Payments in respect of Notes represented by Definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least U.S.$1,000,000 aggregate principal amount of Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

 

4.                                       Paying Agent and Registrar

 

Initially, Union Bank, N.A. (the “Trustee”), will act as Trustee, Paying Agent and Registrar.  The Company may appoint and change any Paying Agent, Registrar or co-registrar

 

 

without notice to any Noteholder.  The Company, the Guarantor or any Subsidiary may act as Paying Agent, Registrar or co-registrar.

 

5.                                       Optional Redemption by the Company

 

The Notes will be redeemable at the option of the Company, in whole at any time or in part from time to time, on at least 30 days but not more than 60 days’ prior notice mailed to the registered address of each Holder of Notes to be so redeemed, at a redemption price equal to (a) the greater of (i) 100% of their principal amount to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon from the date of redemption to the date of maturity (except for currently accrued but unpaid interest) discounted to the date of redemption, on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months), at the applicable Treasury Yield (as defined below), plus 30 basis points (such greater amount, the “Redemption Price”), plus (b) accrued and unpaid interest, if any, to the date of redemption.

 

For purposes of determining the Redemption Price, the following definitions are applicable:

 

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Notes that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.

 

“Comparable Treasury Price” means, with respect to any Redemption Date, (a) the bid price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) at 4:00 P.M. on the third business day preceding such Redemption Date, as set forth on “Bloomberg page PX1” (or such other page as may replace Bloomberg page PX1), or (b) if such page (or any successor page) is not displayed or does not contain such bid prices at such time, (i) the average of the Reference Treasury Dealer Quotations obtained by the Company for such date, after excluding the highest and lowest of four such Reference Treasury Dealer Quotations or (ii) if the Company is unable to obtain at least four such Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations obtained by the Company.

 

“Independent Investment Banker” means any of Citigroup Global Markets Inc., J.P. Morgan Securities LLC or RBS Securities Inc., or, if none of such firms are willing or able to select the applicable Comparable Treasury Issue, a leading independent investment banking institution appointed by the Company.

 

“Reference Treasury Dealer” means Citigroup Global Markets Inc., J.P. Morgan Securities LLC and RBS Securities Inc., and two other primary U.S. Government securities dealer in New York City selected by the Independent Investment Banker (each, a “Primary Treasury Dealer”); provided however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company will substitute another Primary Treasury Dealer.

 

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date for the Notes, an average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Notes (expressed in each case as a percentage of its principal amount) quoted in writing to the Company by such Reference Treasury Dealer at 4:00 p.m., New York City time, on the third business day preceding such Redemption Date.

 

“Treasury Yield” means, with respect to any Redemption Date applicable to the Notes, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the third Business Day immediately preceding such Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the applicable Comparable Treasury Price for such Redemption Date.

 

In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not listed, then on a pro rata basis, by lot or by such other method as the Trustee in its sole discretion shall deem to be fair and appropriate, although no Notes of U.S. $1,000 in original principal amount or less will be redeemed in part.  If any Note is to be redeemed in part only, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Note.  On and after the Redemption Date, interest will cease to accrue on Notes or portions thereof called for redemption as long as the Company has deposited with the Paying Agent funds in satisfaction of the applicable Redemption Price pursuant to the Indenture.

 

6.                                       Offers to Repurchase

 

Upon the occurrence of a Change of Control Triggering Event, the Company shall make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000 thereof) of each Holder’s Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest thereon, if any, to, but excluding, the date of purchase (the “Change of Control Payment”).  The Change of Control Offer shall be made in accordance with Section 3.15 of the Indenture.

 

7.                                       Additional Amounts

 

The Guarantor will pay to the Holder of any Note such additional amounts as may be necessary so that every net payment to a holder or beneficial owner of principal of and premium, if any, and interest on such Note, after deducting or withholding for or on account of any present or future tax, duty, fee, assessment or other similar governmental charge duly imposed by Bermuda, will not be less than the amount provided in such Note to be then due and payable.  The Guarantor will not be required, however, to make any payment of additional amounts for or on account of any such tax imposed by reason of the holder or beneficial owner having some connection with Bermuda, other than its participation as a holder or beneficial owner of a Note.

 

 

8.                                       Denominations; Transfer; Exchange

 

The Notes are in registered form without coupons in denominations of principal amount of U.S. $1,000 and whole multiples of U.S. $1,000.  A Holder may transfer or exchange Notes in accordance with the Indenture.  The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.  The Registrar need not register the transfer of or exchange (i) any Notes selected for redemption (except, in the case of a Note to be redeemed in part, the portion of the Note not to be redeemed) for a period beginning 15 days before the mailing of a notice of Notes to be redeemed and ending on the date of such mailing or (ii) any Notes for a period beginning 15 days before an interest payment date and ending on such interest payment date.

 

9.                                       Persons Deemed Owners

 

The registered Holder of this Note may be treated as the owner of it for all purposes.

 

10.                                 Unclaimed Money

 

If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another Person.  After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment.

 

11.                                 Defeasance

 

Subject to certain conditions set forth in the Indenture, the Company at any time may terminate some or all of its obligations under the Notes and the Indenture if the Company deposits with the Trustee money or U.S. Government Securities for the payment of principal and interest on such Notes to redemption or maturity, as the case may be.

 

12.                                 Amendment, Waiver

 

The Indenture or the Notes may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding Notes; provided, however, that the consent of each Noteholder affected is required to (i) reduce the amount of Notes whose Holders must consent to an amendment of the Indenture, the Notes or specified provisions of the Master Trust Transaction Documents, (ii) reduce the stated rate or extend the stated time for payment of interest on a Note, (iii) reduce the principal of or extend the Stated Maturity of a Note, (iv) reduce the premium payable upon redemption of a Note, (v) make any Note payable in money other than that stated herein, (vi) impair the right of a Holder to receive payment under the Note or institute suit for the enforcement of such payment, (vii) make any change to the amendment provisions which require each Holder’s consent or the waiver provisions, or (viii) release the Guarantor or modify the Guarantee.

 

Subject to certain exceptions set forth in the Indenture, without the consent of any Noteholder, the Company and the Trustee may amend the Indenture or the Notes to cure any ambiguity, omission, defect or inconsistency, or to comply with Article 4 of the Indenture, or to

 

 

provide for uncertificated Notes in addition to or in place of certificated Notes, or to add guarantees with respect to the Notes, or to secure the Notes, or to add additional covenants of the Company, the Guarantor or any Subsidiary, or surrender rights and powers conferred on the Company, the Guarantor or any Subsidiary, issue Subsequent Notes, or to comply with any requirement of the SEC in connection with qualifying the Indenture under the Trust Indenture Act, or to make any change that does not adversely affect the rights of any Noteholder.

 

Subject to certain exceptions set forth in the Indenture, any default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Noteholder affected) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Notes, on behalf of all Holders of the Notes.

 

13.                                 Defaults and Remedies

 

Under the Indenture, Events of Default include (1) default for 30 days in payment of interest or additional interest when due on the Notes; (2) default in payment of principal of or premium, if any, on the Notes at Stated Maturity, upon optional redemption, upon declaration or otherwise; (3)  the failure by the Company or the Guarantor to comply for 60 days after written notice with its other agreements contained in the Indenture or under the Notes (other than those referred to in (1) or (2) above); (4) the failure of the Company, the Guarantor or any Subsidiary (a) to pay the principal of any indebtedness for borrowed money, including obligations evidenced by any mortgage, indenture, bond, debenture, note, guarantee or other similar instruments, on the scheduled or original date due; (b) to pay interest on any such indebtedness beyond any provided grace period; or (c) to observe or perform any agreement or condition relating to such indebtedness, the effect of which is to cause such indebtedness to become due prior to its stated maturity and such acceleration has not been cured within 15 days after notice of acceleration; provided that an event described in clause (a), (b) or (c) above shall not constitute an Event of Default unless, at such time, one or more events of the type described in clauses (a), (b) or (c) shall have occurred or be continuing with respect to indebtedness in an amount exceeding U.S. $50,000,000; or (5) certain events of bankruptcy, insolvency or reorganization of the Company, the Guarantor, a Designated Obligor or any Material Subsidiary (the “bankruptcy events”).  However, a default under clause (3) with respect to the Notes will not constitute an Event of Default with respect to the Notes until the Trustee or the Holders of at least 25% in principal amount of the outstanding Notes notify the Company or the Guarantor, as the case may be, of the default and the Company or the Guarantor, as the case may be, does not cure such default within the time specified in clause (3) hereof after receipt of such notice.

 

If an Event of Default other than a bankruptcy event occurs and is continuing with respect to the Notes, the Trustee or the Holders of at least 25% in principal amount of the Notes may declare all the Notes by written notice to the Company to be due and payable immediately.  If an Event of Default in connection with a bankruptcy event occurs and is continuing, the principal amount of the Notes, the premium, if any, and all accrued and unpaid interest shall be immediately due and payable without any action or other act on the part of the Trustee or the Holders.

 

 

Noteholders may not enforce the Indenture or the Notes except as provided in the Indenture.  The Trustee may refuse to enforce the Indenture or the Notes unless it receives reasonable indemnity or security.  Subject to certain limitations, Holders of a majority in principal amount of the Notes (voting as a single class) may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Noteholders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal or interest) if it determines that withholding notice is in their interest.

 

14.                                 Trustee Dealings with the Company

 

Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.

 

15.                                 No Recourse Against Others

 

An incorporator, director, officer, employee, affiliate or stockholder of each of the Company or the Guarantor, solely by reason of this status, shall not have any liability for any obligations of the Company under the Notes, the Indenture or the Guarantee or for any claim based on, in respect of or by reason of such obligations or their creation.  By accepting a Note, each Noteholder waives and releases all such liability.  The waiver and release are part of the consideration for the issue of the Notes.

 

16.                                 No Petition

 

By its acquisition of this Note, each Holder hereof agrees that neither it nor the Trustee on its behalf may commence, or join with any other person in the commencement of, a bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding with respect to the Company under any applicable insolvency laws until one year and one date after the Notes and all other Indebtedness of the Company ranking equal with or junior to the Notes in right of payment, including all interest and premium thereon, if any, are paid in full.

 

17.                                 Authentication

 

This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication appearing on this Note.

 

18.                                 Abbreviations

 

Customary abbreviations may be used in the name of a Noteholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).

 

 

19.                                 CUSIP Numbers

 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Notes and has directed the Trustee to use CUSIP numbers in notices of redemption as a convenience to Noteholders.  No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

 

20.                                 Governing Law

 

This Note shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to conflicts of law principles thereof.

 

The Company will furnish to any Noteholder upon written request and without charge to the Noteholder a copy of the Indenture.  Requests may be made to:

 

Bunge Limited Finance Corp.

11720 Borman Drive

St. Louis, Missouri 63146

Attention: John Gilsinn

Telephone No: (314) 292-2314

Telecopy: (314) 292-4314

 

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to

 

_____________________________________________________

(Print or type assignee’s name, address and zip code)

 

__________________________________________

(Insert assignee’s soc. sec. or tax I.D. No.)

 

and irrevocably appoint                    agent to transfer this Note on the books of the Company.  The agent may substitute another to act for him.

 

	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
Your Signature
    	
 
    
	
 
    
	
Signature Guarantee:
    	
 
    
	
 
    	
(Signature must be guaranteed)
    
	
 
    
	
 
    
	
Sign   exactly as your name appears on the other side of this Note.
    
					

 

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.

 

 

[TO BE ATTACHED TO NOTES]

SCHEDULE OF INCREASES OR DECREASES IN NOTE

 

The following increases or decreases in this Note have been made:

 

	
Date of Exchange
    	
 
    	
Amount of decrease in
   Principal Amount of this
   Note
    	
 
    	
Amount of increase in
   Principal Amount of this
   Note
    	
 
    	
Principal Amount of this
   Note following such
   decrease or increase
    	
 
    	
Signature of authorized
   signatory of Trustee or
   Securities Custodian
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have this Note purchased by the Company pursuant to Section 3.15 of the Indenture, check the box below:

 

o Section 3.15

 

If you want to elect to have only part of this Note purchased by the Issuer pursuant to Section 3.15 of the Indenture, state the amount you elect to have purchased:

$                  

 

	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Your   Signature:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
(Sign   exactly as your name appears on the face of this Note)
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Tax   Identification No.:
    

 

	
Signature Guarantee*:
    	
 
    	
 
    

 

* Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

 

 

SCHEDULE 1.1

 

The following Subsidiaries constitute all of the Designated Obligors as of the date hereof:

 

·                  Bunge Global Markets Inc.

 

·                  Bunge N.A. Holdings, Inc.

 

·                  Bunge North America, Inc.

 

·                  Koninklijke Bunge B.V.

 

·                  Bunge Alimentos S.A.

 

·                  Bunge Argentina S.A.

 

·                  Bunge Fertilizantes International Limited

 

·                  Bunge Fertilizantes S.A. (Brazil)

 

·                  Bunge International Commerce Ltd.

 

·                  Bunge Finance B.V.

 

·                  Bunge S.A.

 

The following Subsidiaries constitute all of the Material Subsidiaries as of the date hereof:

 

·              Bunge North America, Inc.

 

·              Bunge Brasil Holdings B.V.

 

·              Koninklijke Bunge B.V.

 

 

SCHEDULE 3.4

 

Existing Liens

 

	
Subsidiary/Joint
   Ventures
    	
 
    	
Facility
    	
 
    	
Amount
   Outstanding
    	
 
    	
Description of Collateral
    
	
Terminal   6 SA (unconsolidated joint ventures in Argentina)
    	
 
    	
Bank   (Bunge’s share)
    	
 
    	
$2.8   million
    	
 
    	
Shares   of Terminal 6 SA
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Bunge   Alimentos S.A.
    	
 
    	
BNDES
    	
 
    	
$8.4   million
    	
 
    	
Land,   buildings and equipment
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
TGG   (consolidated JV)
    	
 
    	
BNDES
    	
 
    	
$71.8   million
    	
 
    	
Shares   of TGG
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Black Sea Industries Ukraine
    	
 
    	
EBRD   Loan
    	
 
    	
$30.7   million
    	
 
    	
Extraction   plant, Preparation plant and Boiler house (buildings and equipment) of BSIU   crushing plant at Illychevsk, Ukraine
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Bunge   S.A.
    	
 
    	
Bank
    	
 
    	
$17.5   million
    	
 
    	
Collateral   under CSA
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Baria   Joint Stock Co. of Services
    	
 
    	
Bank
    	
 
    	
$3.9   million
    	
 
    	
EquipmentExhibit 10.1

 

EXECUTION VERSION

 

 

 

ASSET PURCHASE AGREEMENT

 

DATED AS OF MARCH 9, 2011

 

BY AND BETWEEN

 

STATION GVR ACQUISITION, LLC,

 

AS PURCHASER,

 

AND

 

GREEN VALLEY RANCH GAMING, LLC,

 

AS THE COMPANY

 

 

 

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
PAGE
    
	
 
    
	
ARTICLE I
    
	
DEFINITIONS
    
	
 
    	
 
    	
 
    
	
1.1
    	
CERTAIN DEFINITIONS
    	
2
    
	
1.2
    	
OTHER DEFINITIONAL AND INTERPRETIVE   MATTERS
    	
12
    
	
 
    
	
ARTICLE II
    
	
PURCHASE AND SALE OF ASSETS; ASSUMPTION OF   LIABILITIES
    
	
 
    
	
2.1
    	
PURCHASE AND SALE OF ASSETS
    	
13
    
	
2.2
    	
EXCLUDED ASSETS
    	
14
    
	
2.3
    	
ASSUMPTION OF LIABILITIES
    	
15
    
	
2.4
    	
EXCLUDED LIABILITIES
    	
16
    
	
2.5
    	
DESIGNATION RIGHT PERIOD
    	
17
    
	
2.6
    	
PROCEDURES FOR ASSUMPTION OF   AGREEMENTS
    	
17
    
	
2.7
    	
FURTHER CONVEYANCES AND ASSUMPTIONS
    	
18
    
	
2.8
    	
BULK SALES LAW
    	
18
    
	
 
    
	
ARTICLE III
    
	
CONSIDERATION
    
	
 
    
	
3.1
    	
CONSIDERATION
    	
19
    
	
3.2
    	
ESCROWED FUNDS; DEPOSIT COMMITMENT
    	
19
    
	
3.3
    	
PAYMENT OF PURCHASE PRICE;   ASSUMPTION OF ASSUMED LIABILITIES
    	
19
    
	
3.4
    	
CURE COSTS
    	
20
    
	
 
    
	
ARTICLE IV
    
	
CLOSING   AND TERMINATION
    
	
 
    
	
4.1
    	
CLOSING DATE
    	
20
    
	
4.2
    	
DELIVERIES BY THE COMPANY
    	
20
    
	
4.3
    	
DELIVERIES BY PURCHASER
    	
21
    
	
4.4
    	
LICENSE AGREEMENT
    	
21
    
	
4.5
    	
TERMINATION OF AGREEMENT
    	
22
    
	
4.6
    	
PROCEDURE UPON TERMINATION
    	
23
    
	
4.7
    	
EFFECT OF TERMINATION
    	
24
    
	
 
    
	
ARTICLE V
    
	
REPRESENTATIONS   AND WARRANTIES OF THE COMPANY
    
	
 
    
	
5.1
    	
THE COMPANY’S REPRESENTATIONS AND   WARRANTIES
    	
25
    
	
5.2
    	
ORGANIZATION AND GOOD STANDING
    	
25
    
	
5.3
    	
AUTHORIZATION OF AGREEMENT
    	
25
    
	
5.4
    	
CONFLICTS; CONSENTS OF THIRD   PARTIES
    	
26
    

 

i

 

	
5.5
    	
TITLE TO PURCHASED ASSETS
    	
26
    
	
5.6
    	
FINANCIAL STATEMENTS
    	
27
    
	
5.7
    	
REAL PROPERTY
    	
27
    
	
5.8
    	
INTELLECTUAL PROPERTY
    	
27
    
	
5.9
    	
AGREEMENTS, CONTRACTS AND   COMMITMENTS
    	
28
    
	
5.10
    	
LITIGATION; ORDERS
    	
28
    
	
5.11
    	
ENVIRONMENTAL MATTERS
    	
28
    
	
5.12
    	
LABOR MATTERS
    	
29
    
	
5.13
    	
EMPLOYEE BENEFITS
    	
29
    
	
5.14
    	
FINANCIAL ADVISORS
    	
30
    
	
5.15
    	
PERMITS; COMPLIANCE WITH LAWS
    	
30
    
	
5.16
    	
TAXES
    	
31
    
	
5.17
    	
BANKRUPTCY NOTICES
    	
31
    
	
5.18
    	
SUFFICIENCY OF ASSETS
    	
31
    
	
5.19
    	
NO OTHER REPRESENTATIONS OR   WARRANTIES; SCHEDULES
    	
31
    
	
 
    
	
ARTICLE VI
    
	
REPRESENTATIONS   AND WARRANTIES OF PURCHASER
    
	
 
    
	
6.1
    	
PURCHASER’S REPRESENTATIONS AND   WARRANTIES
    	
32
    
	
6.2
    	
ORGANIZATION AND GOOD STANDING;   OWNERSHIP
    	
33
    
	
6.3
    	
AUTHORIZATION OF AGREEMENT; NO VOTE   REQUIRED
    	
33
    
	
6.4
    	
NO KNOWLEDGE OF MISREPRESENTATIONS   OR OMISSIONS
    	
33
    
	
6.5
    	
CONFLICTS; CONSENTS OF THIRD   PARTIES
    	
33
    
	
6.6
    	
LITIGATION
    	
34
    
	
6.7
    	
FINANCIAL ADVISORS
    	
34
    
	
6.8
    	
FINANCIAL CAPABILITY; FINANCING   COMMITMENTS
    	
34
    
	
6.9
    	
LICENSABILITY OF PURCHASER AND   PRINCIPALS
    	
35
    
	
6.10
    	
COMPLIANCE WITH GAMING LAWS
    	
35
    
	
6.11
    	
PURCHASED ASSETS “AS IS”;   PURCHASER’S ACKNOWLEDGMENT AND INVESTIGATION
    	
36
    
	
 
    
	
ARTICLE VII
    
	
BANKRUPTCY   COURT MATTERS
    
	
 
    
	
7.1
    	
ACTIONS OF THE COMPANY
    	
37
    
	
7.2
    	
PURCHASER ACTIONS
    	
37
    
	
7.3
    	
ADEQUATE ASSURANCES
    	
38
    
	
7.4
    	
SALE ORDER
    	
38
    
	
7.5
    	
SUPPORT OF SALE ORDER
    	
39
    
	
7.6
    	
ASSIGNMENT OF CONTRACTS
    	
39
    
	
 
    
	
ARTICLE VIII
    
	
PRE-CLOSING   COVENANTS AND AGREEMENTS
    
	
 
    
	
8.1
    	
ACCESS TO INFORMATION
    	
40
    
	
8.2
    	
CONDUCT OF THE BUSINESS PENDING THE   CLOSING
    	
40
    

 

ii

 

	
8.3
    	
CERTAIN FINANCING MATTERS
    	
42
    
	
8.4
    	
REGULATORY APPROVALS
    	
43
    
	
8.5
    	
FURTHER ASSURANCES
    	
45
    
	
8.6
    	
CONFIDENTIALITY
    	
45
    
	
8.7
    	
PRESERVATION OF RECORDS
    	
45
    
	
8.8
    	
PUBLICITY
    	
46
    
	
8.9
    	
SUPPLEMENTATION AND AMENDMENT OF   SCHEDULES
    	
46
    
	
8.10
    	
PAYMENT OF RESTRUCTURING FEE
    	
46
    
	
8.11
    	
PAYMENT OF TICKING FEE
    	
46
    
	
8.12
    	
PAYMENT OF GAMING DELAY EXTENSION   FEE
    	
47
    
	
 
    
	
ARTICLE IX
    
	
ADDITIONAL   AGREEMENTS
    
	
 
    
	
9.1
    	
EMPLOYEES
    	
47
    
	
9.2
    	
RESERVATIONS; CHIPS; CUSTOMER   INFORMATION
    	
49
    
	
9.3
    	
CERTAIN TRANSACTIONS
    	
50
    
	
9.4
    	
INSURANCE POLICIES
    	
51
    
	
9.5
    	
NO CONTROL
    	
51
    
	
9.6
    	
EMPLOYEE SOLICITATION
    	
51
    
	
 
    
	
ARTICLE X
    
	
CONDITIONS   TO CLOSING
    
	
 
    
	
10.1
    	
CONDITIONS PRECEDENT TO OBLIGATIONS   OF PURCHASER
    	
52
    
	
10.2
    	
CONDITIONS PRECEDENT TO OBLIGATIONS   OF THE COMPANY
    	
53
    
	
10.3
    	
CONDITIONS PRECEDENT TO OBLIGATIONS   OF PURCHASER AND THE COMPANY
    	
54
    
	
10.4
    	
FRUSTRATION OF CLOSING CONDITIONS
    	
54
    
	
 
    
	
ARTICLE XI
    
	
TAXES
    
	
 
    
	
11.1
    	
TRANSFER TAXES
    	
54
    
	
11.2
    	
PURCHASE PRICE ALLOCATION
    	
55
    
	
11.3
    	
COOPERATION ON TAX MATTERS
    	
55
    
	
 
    
	
ARTICLE XII
    
	
MISCELLANEOUS
    
	
 
    
	
12.1
    	
EXPENSES
    	
55
    
	
12.2
    	
SPECIFIC PERFORMANCE; OTHER   REMEDIES
    	
55
    
	
12.3
    	
SUBMISSION TO JURISDICTION; CONSENT   TO SERVICE OF PROCESS
    	
56
    
	
12.4
    	
WAIVER OF RIGHT TO   TRIAL BY JURY
    	
56
    
	
12.5
    	
ENTIRE AGREEMENT; AMENDMENTS;   WAIVERS
    	
56
    
	
12.6
    	
GOVERNING LAW
    	
57
    
	
12.7
    	
NOTICES
    	
57
    
	
12.8
    	
SEVERABILITY
    	
58
    
	
12.9
    	
BINDING EFFECT; ASSIGNMENT
    	
58
    

 

iii

 

	
12.10
    	
NON-RECOURSE
    	
59
    
	
12.11
    	
TERMINATION OF REPRESENTATIONS AND   WARRANTIES
    	
59
    
	
12.12
    	
SCHEDULES
    	
59
    
	
12.13
    	
COUNTERPARTS
    	
59
    
	
12.14
    	
NO THIRD-PARTY BENEFICIARIES
    	
59
    

 

	
Exhibits
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exhibit A
    	
-
    	
Escrow   Agreement
    
	
Exhibit B
    	
-
    	
Deposit   Commitment Letter
    
	
Exhibit C
    	
-
    	
Transition   Services Agreement
    

 

	
Schedules
    	
 
    
	
 
    	
 
    
	
Schedule 1.1(a)
    	
Acquired   IP Assets
    
	
Schedule 1.1(b)
    	
Affiliate   Agreements
    
	
Schedule 1.1(c)
    	
Assumed   Agreements
    
	
Schedule 1.1(d)
    	
Excluded   Agreements
    
	
Schedule 1.1(e)
    	
Excluded   Intellectual Property
    
	
Schedule 1.1(f)
    	
Knowledge   Parties
    
	
Schedule 1.1(g)
    	
Property   Description
    
	
Schedule 2.1
    	
Encumbrances   on Assumed Liabilities
    
	
Schedule 2.1(c)
    	
Information   Technology Assets
    
	
Schedule 2.1(o)
    	
Sales   and Use Tax Refund Claims
    
	
Schedule 2.2(h)
    	
Assets   Not Lawfully Transferrable
    
	
Schedule 2.4
    	
Excluded   Liabilities
    
	
Schedule   4.2(k)
    	
Consents   to Assignment
    
	
Schedule 4.4
    	
License   Agreement
    
	
Schedule 5.4(a)
    	
Conflicts
    
	
Schedule 5.4(b)
    	
Required   Consents
    
	
Schedule 5.5
    	
Title   to Purchased Assets
    
	
Schedule 5.6(a)
    	
Financial   Statements
    
	
Schedule 5.7
    	
Leasehold   Interests
    
	
Schedule 5.9
    	
Material   Contracts
    
	
Schedule 5.10
    	
Litigation;   Orders
    
	
Schedule 5.11
    	
Environmental   Matters
    
	
Schedule 5.12(a)
    	
Labor   Matters
    
	
Schedule 5.12(b)
    	
Labor   Matters — WARN Act Liability
    
	
Schedule 5.13
    	
Employee   Benefits
    
	
Schedule 5.14
    	
Financial   Advisors
    
	
Schedule 5.15
    	
Permits
    
	
Schedule 6.5(b)
    	
Required   Consents
    
	
Schedule 6.9
    	
Licensed   Affiliates
    
	
Schedule 10.1(c)
    	
Purchaser   Required Permits
    
	
Schedule 10.1(e)
    	
Required   Consents and Authorizations
    

 

iv

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of March 9, 2011 (the “Effective Date”), is by and between GREEN VALLEY RANCH GAMING, LLC, a Nevada limited liability company (the “Company”), and STATION GVR ACQUISITION, LLC, a Nevada limited liability company (“Purchaser”).  Each of the Company and Purchaser is a “Party” and, collectively, they are the “Parties” to this Agreement.

 

W I T N E S S E T H:

 

WHEREAS, the Company presently contemplates that it will file voluntary petitions for relief under chapter 11 of the Bankruptcy Code (the “Bankruptcy Case”), in the United States Bankruptcy Court for the District of Nevada (the “Bankruptcy Court”);

 

WHEREAS, the Company presently operates the Green Valley Ranch Resort, Spa & Casino in Henderson, Nevada;

 

WHEREAS, following a robust and lengthy marketing process, the Company desires to sell, transfer and assign to Purchaser, and Purchaser desires to purchase, acquire and assume from the Company pursuant to, among other things, Sections 363 and 365 of the Bankruptcy Code and as part of a pre-packaged chapter 11 plan of reorganization for the Company, the Purchased Assets and the Assumed Liabilities, all as more specifically provided herein;

 

WHEREAS, the Company intends: (a) promptly following execution of this Agreement, to solicit from the lenders under the First Lien Credit Agreement acceptances of a pre-packaged chapter 11 plan of reorganization; and (b) if the lenders under the First Lien Credit Agreement vote as a class to accept such plan, promptly following such solicitation, commence the Bankruptcy Case and, request that the Bankruptcy Court promptly schedule a hearing on confirmation of the plan, including approval of Purchaser’s bid under this Agreement as the highest or otherwise best offer for the Company and authorization for the Company to pursue consummation of the transactions contemplated by this Agreement as part of a chapter 11 plan of reorganization;

 

WHEREAS, in connection with the execution and delivery of this Agreement and concurrent with the same, Fertitta Entertainment, LLC (“FE”), JPMorgan Chase Bank, N.A. (“JPM”) and German American Capital Corporation  (“GACC”, and, collectively with JPM, the “Mortgage Lenders”), the Company and American Stock Transfer & Trust Company, LLC, as escrow agent (the “Escrow Agent”) have entered into the Escrow Agreement attached hereto as Exhibit A (the “Escrow Agreement”), pursuant to which, within two (2) Business Days from the date hereof, (i) FE shall deposit $12,500,000 (the “FE Escrowed Funds”) with the Escrow Agent and (ii) the Mortgage Lenders shall enter into, and deliver to the Company (with a copy to the Escrow Agent), the commitment letter attached hereto as Exhibit B (the “Deposit Commitment Letter”), that provides that (1) at the time set forth in the Deposit Commitment Letter, each Mortgage Lender consents to the transfer to the Escrow Agent of such Mortgage Lender’s Ratable Share (as defined in the Deposit Commitment Letter) of $12,500,000 of Propco Cash (as defined in the SCI Plan) that is Cash Collateral (as defined in the Bankruptcy Code) of the Mortgage Lenders (such amount of such Propco Cash, the “Deposit Commitment Funds”) and

 

 

agrees to cause its liens to be released with respect to the Deposit Commitment Funds to accommodate the transfer of such funds to the Escrow Agent and (2) the Mortgage Lenders shall use reasonable best efforts to obtain the approval of the Bankruptcy Court of the transfer (the “Transfer Approval”) described in clause (1) (the Deposit Commitment Funds when so transferred to the Escrow Agent, the “CP Escrowed Funds”).  Upon the deposit of the CP Escrowed Funds with the Escrow Agent, the Deposit Commitment Letter shall terminate in accordance with its terms.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter contained, the Parties hereby agree as follows:

 

ARTICLE I
  DEFINITIONS

 

1.1           Certain Definitions.  For purposes of this Agreement, the following terms shall have the meanings specified or referenced below:

 

“Accounts Receivable” means all accounts receivable of the Company.

 

“Acquired IP Assets” means (i) all Intellectual Property of the Company, including the Intellectual Property set forth on Schedule 1.1(a), but excluding the Excluded Intellectual Property and (ii) any right to use the foregoing.

 

“Affiliate” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person, and the term “control” (including the terms “controlled by” and “under common control with”) 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 ownership of voting securities, by contract or otherwise.

 

“Affiliate Agreements” means the contracts listed on Schedule 1.1(b).

 

“Agreement” has the meaning set forth in the Preamble.

 

“Allocation Schedule” has the meaning set forth in Section 11.2.

 

“Alternative Financing” has the meaning set forth in Section 8.3(a).

 

“Ancillary Agreements” means the Escrow Agreement, the Transition Services Agreement, the Bill of Sale, the Assignment and Assumption Agreement and each other instrument, certificate, document or agreement of any kind or description relating to this Agreement.

 

“Antitrust Division” has the meaning set forth in Section 8.4(c).

 

“Antitrust Laws” has the meaning set forth in Section 8.4(d).

 

“Applicable Time” has the meaning set forth in Section 3.2.

 

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“Assignment and Assumption Agreement” has the meaning set forth in Section 4.2(b).

 

“Assumed Agreements” means, collectively, the Transition Services Agreement and all other Contracts to which the Company is party set forth on Schedule 1.1(c) (as such schedule may be amended from time to time, except with respect to the Transition Services Agreement, pursuant to Section 2.5).  Schedule 1.1(c) also sets forth the estimated Cure Cost which the Company expects will be payable for each Assumed Agreement.

 

“Assumed Liabilities” has the meaning set forth in Section 2.3.

 

“Audited Financial Information” has the meaning set forth in Section 5.6(a).

 

“Balance Sheet” has the meaning set forth in Section 5.6(b).

 

“Balance Sheet Date” has the meaning set forth in Section 5.6(b).

 

“Bankruptcy Case” has the meaning set forth in the Recitals.

 

“Bankruptcy Code” means Title 11 of the United States Code, 11 U.S.C. §§ 101-1532, as may be amended from time to time.

 

“Bankruptcy Court” has the meaning set forth in the Recitals.

 

“Bill of Sale” has the meaning set forth in Section 4.2(c).

 

“Business Day” means any day of the year on which national banking institutions in New York City, New York are open to the public for conducting business and are not required or authorized to close.

 

“Cage Cash” means all cash contained in the cage, slot kiosks, count rooms, and drop boxes at the Property existing at the Closing Date.

 

“Casino Business” means all of the Company’s gambling, gaming, hospitality, entertainment and related businesses, as currently conducted in Henderson, Nevada.

 

“Challenge” means, with respect to any Order, an appeal, notice of appeal, motion to amend or make additional findings of fact, motion to alter or amend judgment, motion for rehearing or motion for new trial, request for stay, motion or petition for reconsideration, application or request for review, or other similar motion, application, notice or request.

 

“Closing” has the meaning set forth in Section 4.1.

 

“Closing Date” has the meaning set forth in Section 4.1.

 

“Closing Payment” has the meaning set forth in Section 3.3.

 

“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and as codified in Section 4980B of the Code and Section 601 et seq. of ERISA.

 

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“Code” means the Internal Revenue Code of 1986, as amended.

 

“Collective Bargaining Agreement” means any Contract or other binding agreement or arrangement between the Company and any labor union or organization, works council or other similar employee representative.

 

“Commission” means the United States Securities and Exchange Commission or any successor thereto.

 

“Common Customers” has the meaning set forth in Section 9.2(c).

 

“Company” has the meaning set forth in the Preamble.

 

“Company Benefit Plans” has the meaning set forth in Section 5.13(a).

 

“Company Documents” has the meaning set forth in Section 5.3.

 

“Confidentiality Agreement” has the meaning set forth in Section 8.6.

 

“Contract” means any legally binding indenture, note, bond, mortgage, deed of trust, deed of constitution of mortgage, mortgage note pledge agreement, loan agreement, franchise agreement, lease, sublease, license, sublicense, purchase order and other contract, agreement, arrangement, commitment or instrument to which the Company is a party.

 

“CP Escrowed Funds” has the meaning set forth in the Recitals.

 

“Credit Agreements” means (i) the First Lien Credit Agreement dated as of February 16, 2007 (the “First Lien Credit Agreement”) between the Company, Bank of America, N.A., as the Administrative Agent and a Lender, Banc of America Securities, LLC, as Sole Lead Arranger and Sole Book Manager, and each person that is a “Lender” named in the First Lien Credit Agreement and (ii) the Second Lien Credit Agreement dated as of February 16, 2007 (the “Second Lien Credit Agreement”) between the Company, Bank of America, N.A., as the Administrative Agent and a Lender, Banc of America Securities, LLC, as Sole Lead Arranger and Joint Book Manager, Wachovia Capital Markets, LLC, as Joint Book Manager, and each person that is a “Lender” named in the Second Lien Credit Agreement.

 

“Cure Costs” has the meaning set forth in Section 2.6(a).

 

“Customer Database” means all customer databases, customer lists and any other similar information, in each case, collected and owned by the Company and relating to customer play at the Casino Business.

 

“Debt Financing Sources” has the meaning set forth in Section 8.3(c).

 

“Deposit Commitment Funds” has the meaning set forth in the Recitals.

 

“Deposit Commitment Letter” has the meaning set forth in the Recitals.

 

“Deposits” has the meaning set forth in Section 2.1(g).

 

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“Designation Right Period” has the meaning set forth in Section 2.5.

 

“Documents” means all files, documents, instruments, papers, books, reports, records, tapes, microfilms, photographs, letters, budgets, forecasts, ledgers, journals, title policies, customer lists, regulatory filings, operating data and plans, marketing documentation (sales brochures, flyers, pamphlets, web pages, etc.), and other similar materials of the Company, in each case whether or not in electronic form.

 

“Effective Date” has the meaning set forth in the Preamble.

 

“Employees” means all individuals who are employed by the Company (excluding, for the avoidance of doubt, any individuals who are employed by SCI or have employment contracts with SCI) as of the Effective Date, together with individuals (a) who are hired by the Company after the Effective Date and prior to the Closing or (b) who have or will have re-hire or reinstatement rights with the Company as of the Closing.

 

“Encumbrance” means any lien, encumbrance, pledge, mortgage, deed of trust, security interest, claim (including any claim as defined under Section 101(5) of the Bankruptcy Code), lease, charge (including any charge as defined under Section 101(12) of the Bankruptcy Code), option, right of first refusal, easement, servitude, proxy, voting trust or agreement, transfer restriction under any shareholder or similar agreement or encumbrance, collateral assignment, right of setoff, debt, obligation, liability, pledge, levy, escrow, conditional sale contract, title retention contract, mortgage, lease, deed of trust, hypothecation, indenture, security agreement, any other agreement, arrangement, contract, commitment, understanding or obligation of any kind whatsoever, whether written or oral, but does not include any restrictions under licenses of, or other agreements related to, Intellectual Property.

 

“Environmental Laws” means all applicable federal, state, municipal, or local laws, statutes or by laws or ordinances relating to the environment and any other applicable environmental laws, in each case as amended from time to time.

 

“Equipment” means all Gaming Equipment, machinery, equipment, furniture, fixtures, computer and computer-related hardware and firmware, copiers, telephone lines and numbers and other telecommunication equipment, all food processing and preparation and washing equipment, racks, trays, buffet tables, utensils, plates and other similar items, uniforms, napkins, linens and other tangible personal property owned by the Company.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISA Affiliate” means, with respect to any entity, any trade or business, whether or not incorporated, that together with such entity and its subsidiaries would be deemed a “single employer” within the meaning of Section 4001 of ERISA.

 

“Escrow Agent” has the meaning set forth in the Recitals.

 

“Escrow Agreement” has the meaning set forth in the Recitals.

 

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“Excluded Agreements” means the Contracts listed on Schedule 1.1(d) (as such schedule may be amended from time to time pursuant to Section 2.5).

 

“Excluded Assets” has the meaning set forth in Section 2.2.

 

“Excluded Intellectual Property” means the Intellectual Property of the Company set forth on Schedule 1.1(e).

 

“Excluded Liabilities” has the meaning set forth in Section 2.4.

 

“Excluded Matter” means any one or more of the following:  (a) the effect of any changes in applicable Law or GAAP; (b) any change, event or effect arising out of or resulting from changes in or affecting the (i) travel, hospitality or gaming industries generally (except to the extent that any change, event or effect affects the Casino Business in a disproportionate manner when compared to the effect of such change, event or effect on other Persons engaged in the travel, hospitality or gaming industries generally), (ii) travel, hospitality or gaming industries in the locals, Las Vegas or Nevada markets (except to the extent that any change, event or effect affects the Casino Business in a disproportionate manner when compared to the effect of such change, event or effect on other Persons engaged in the travel, hospitality or gaming industries in the locals, Las Vegas or Nevada markets) or (iii) financial, banking, currency or capital markets in general, the economy in general or political or regulatory conditions; (c) any change, event or effect resulting from the entering into or public announcement of the transactions contemplated by this Agreement; (d) any change, event or effect resulting from any act of terrorism, commencement, escalation, continuation or cessation of armed hostilities in the United States or internationally or declaration of war by or against or otherwise involving the United States (except, with respect to an act of terrorism, to the extent that any change, event or effect affects the Casino Business in a disproportionate manner when compared to the effect of such change, event or effect on other Persons engaged in the travel, hospitality or gaming industries generally); and (e) any failure by the Company to meet any internal or published industry analyst projections or forecasts or estimates of revenues or earnings for any period (it being agreed that the facts and circumstances giving rise to such failure that are not otherwise included within the definition of Excluded Matter may be taken into account in determining whether a Material Adverse Effect has occurred).

 

“FE” has the meaning set forth in the Recitals.

 

“FE Escrowed Funds” has the meaning set forth in the Recitals.

 

“Final Order” means an Order of the Bankruptcy Court or other court of competent jurisdiction:  (a) as to which no Challenge has been timely filed, or, if any of the foregoing has been timely filed, it has been disposed of in a manner that upholds and affirms the subject order in all material respects without the possibility for further Challenge thereon; (b) as to which the time for instituting or filing a Challenge shall have expired; and (c) as to which no stay is in effect; provided, however, the possibility that a motion under Rule 59 or Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the Bankruptcy Code or the Federal Rules of Bankruptcy Procedure, may be filed with respect to such Order shall not prevent such Order from being deemed a Final Order.

 

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“Financial Information” has the meaning set forth in Section 5.6(a).

 

“Financing” has the meaning set forth in Section 6.8(b).

 

“Financing Commitments” has the meaning set forth in Section 6.8(b).

 

“First Lien Credit Agreement” has the meaning set forth in the definition of Credit Agreements.

 

“First Lien Credit Agreement Agent” means Wilmington Trust FSB, in its capacity as administrative agent for the lenders under the First Lien Credit Agreement.

 

“First Lien Credit Agreement Claim” means claims under the First Lien Credit Agreement, including Secured Hedging Obligations (as defined therein), if any.

 

“First Lien Lender Plan Support Agreement” means that certain Letter Agreement by and between the Company and the lenders under the First Lien Credit Agreement signatories thereto, substantially in the form made available to the Parties prior to the date hereof.

 

“FTC” has the meaning set forth in Section 8.4(c).

 

“GAAP” means generally accepted accounting principles in the United States as of the date hereof.

 

“GACC” has the meaning set forth in the Recitals.

 

“Gaming Approvals” means all Permits, authorizations, registrations, franchises, entitlements, waivers and exemptions issued by any Gaming Authority required to permit the Parties to consummate the transactions contemplated by this Agreement or necessary to permit Purchaser to acquire the Purchased Assets, assume the Assumed Liabilities and operate the Casino Business, in each case, after the Closing.

 

“Gaming Authorities” means all Governmental Entities with regulatory control or jurisdiction over the conduct of lawful gaming or gambling, including, without limitation, the Nevada Gaming Commission, the Nevada State Gaming Control Board, the City of Henderson, Nevada and all other state and local regulatory and licensing bodies with authority over gaming activities and devices in the State of Nevada or the City of Henderson, Nevada.

 

“Gaming Delay” has the meaning set forth in Section 4.5(b).

 

“Gaming Delay Extension Fee” has the meaning set forth in Section 8.12.

 

“Gaming Equipment” means all gambling games, slot machines, video poker machines, tables, “gaming devices” (as defined in Section 463.0155 of the NRS), “cashless wagering systems” (as defined in Section 463.014 of the NRS) gaming devices parts inventory, and other gaming equipment of the Company, together with the Company’s inventory of gaming cards, chips, tokens, scrip, markers, gaming supplies, “associated equipment” (as defined in

 

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Section 463.0136 of the NRS) and other items that are used by the Company in the operation of the Casino Business.

 

“Gaming Law” means any Permit, Law, Order or other federal, state, local or foreign statute, ordinance, rule, regulation, permit, consent, registration, finding of suitability, approval, license, judgment, order, decree, injunction or other authorization, including any condition or limitation placed thereon, governing or relating to casino and gaming activities and operations, gaming-related manufacturing or the distribution of Gaming Equipment, in each case, of the applicable Person and its Affiliates.

 

“Governmental Approval” means any Permit, waiver, or other authorization issued, granted, given, or otherwise made available by or under the authority of any Governmental Entity or pursuant to any Law.

 

“Governmental Entity” means any government or governmental or regulatory body thereof, or quasi-governmental or quasi-regulatory body thereof, or political subdivision thereof, whether supra-national, federal, state or local, or any agency, instrumentality or authority thereof, or any court or arbitrator (public or private), including, without limitation, any Gaming Authority.

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

 

“Indebtedness” of any Person means, without duplication, (i) the principal of and premium (if any) in respect of (A) indebtedness of such Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable; (ii) indebtedness underlying swaps, caps or other derivative instruments; (iii) all obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement (but excluding trade accounts payable and other accrued current liabilities arising in the Ordinary Course of Business); (iv) all obligations of such Person under leases required to be capitalized in accordance with GAAP; (v) all obligations of such Person for the reimbursement of any obligor on any letter of credit, banker’s acceptance or similar credit transaction; (vi) the liquidation value of all redeemable preferred stock of such Person; (vii) all obligations of the type referred to in clauses (i) through (vi) of any Persons for the payment of which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety or otherwise, including guarantees of such obligations; and (viii) all obligations of the type referred to in clauses (i) through (vii) of other Persons secured by any lien on any property or asset of such Person (whether or not such obligation is assumed by such Person).

 

“Intellectual Property” means (a) patents, trademarks, trade names, copyrights, corporate names, logos, together with all goodwill associated with each of the foregoing; (b) trade secrets, confidential and proprietary information; (c) Internet domain names and (d) all other intellectual property.

 

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“Inventory” means all inventory of the Company of merchandise held for resale or use in the Casino Business and all food and beverage inventory, including rights to vending and concession inventory, held for sale or service to patrons and/or employees of the Casino Business.

 

“IRS” means the Internal Revenue Service of the United States Department of the Treasury.

 

“JPM” has the meaning set forth in the Recitals.

 

“June Ticking Fee” has the meaning set forth in Section 8.11.

 

“Knowledge of the Company” and “Company’s Knowledge” and words of similar import mean the actual knowledge of those Persons identified on Schedule 1.1(f).

 

“Land” means that certain parcel of real property located at the intersection of Interstate 215 and Green Valley Parkway as more particularly described on Schedule 1.1(g).

 

“Law” means any federal, state, provincial, local or foreign law, statute, code, ordinance, decisional authority, rule or regulation, including any Gaming Law.

 

“Legal Proceeding” means any judicial, administrative or arbitral actions, suits, proceedings (public or private) or claims by or before a Governmental Entity.

 

“Liability” means any direct or indirect liability, Indebtedness, obligation, commitment, expense, claim, deficiency, guaranty or endorsement of or by any Person of any type, whether accrued, absolute, contingent, matured, unmatured, liquidated, unliquidated, known or unknown and including all costs and expenses relating thereto.

 

“License Agreement” has the meaning set forth in Section 4.4.

 

“M&A Qualified Beneficiaries” has the meaning set forth in Section 9.1(g).

 

“Material Adverse Effect” means a material adverse effect on the Purchased Assets or the business, operations, assets, liabilities or condition of the Casino Business taken as a whole, other than an effect resulting from an Excluded Matter.

 

“Material Contract” means any Contract to which the Company is a party, including any Assumed Agreement, that (a) has a remaining obligation for payment or services by the Company in excess of two hundred fifty thousand U.S. dollars ($250,000), and (b) is not cancelable by the Company upon forty-five (45) days or less notice.

 

“May Ticking Fee” has the meaning set forth in Section 8.11.

 

“Mortgage Lenders” has the meaning set forth in the Recitals.

 

“Non-Recourse Parties” has the meaning set forth in Section 12.10.

 

“Notifying Party” has the meaning set forth in Section 8.4(a).

 

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“NRS” means the Nevada Revised Statutes.

 

“Order” means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration award of a Governmental Entity.

 

“Ordinary Course of Business” means the ordinary and usual course of normal day-to-day operations of the Casino Business, consistent with past practice.

 

“Party” or “Parties” has the meaning set forth in the Preamble.

 

“Permits” has the meaning set forth in Section 5.15.

 

“Permitted Encumbrances” means (a) all defects, exceptions, restrictions, easements, rights of way and encumbrances disclosed in the title policies previously made available to Purchaser; (b) statutory liens for current Taxes, assessments or other governmental charges not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings; (c) mechanics’, carriers’, workers’, repairers’, landlords’ and warehousemen’s and similar Encumbrances imposed by statute and arising or incurred in the Ordinary Course of Business not yet delinquent or the amount and validity of which is being contested in good faith, not material in amount, individually or in the aggregate, and that will not interfere materially with the operation of the Casino Business or its right to use, or the value of, the property subject thereto; (d) zoning, entitlement and other land use and environmental regulations by any Governmental Entity; provided that such regulations have not been violated; (e) title of a lessor under a capital or operating lease; (f) any other Encumbrances that will be irrevocably released in full in connection with the Sale Order; (g) such other imperfections in title, charges, easements, restrictions and encumbrances that would not materially interfere with the use or occupancy of the applicable property; (h) any and all matters that would be disclosed by an accurate survey or inspection of the applicable property in the operation of the Casino Business as currently conducted or the value thereof; and (i) any interests or rights of any kind or description of any lessee, with respect to the applicable property, pursuant to any lease listed on Schedule 5.7. For the avoidance of doubt, “Permitted Encumbrances” shall not include any Encumbrance in favor of any lender or agent under, or otherwise arising pursuant to or in connection with, the Credit Agreements.

 

“Person” means any individual, corporation, limited liability company, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Entity or other entity.

 

“Potential Transaction” has the meaning set forth in Section 7.1(a).

 

“Property” means the Land, and all tangible personal property, fixtures and improvements owned by the Company and placed on, attached to or located at or used in connection with the operation of the Land.

 

“Purchase Price” has the meaning set forth in Section 3.1.

 

“Purchased Assets” has the meaning set forth in Section 2.1.

 

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“Purchaser” has the meaning set forth in the Preamble.

 

“Purchaser 401(k) Plan” has the meaning set forth in Section 9.1(h).

 

“Purchaser Documents” has the meaning set forth in Section 6.3.

 

“Purchaser Knowledge Persons” means Frank Fertitta, Lorenzo Fertitta, Richard Haskins, Marc Falcone, Scott Nielson, Kevin Kelly and Thomas Friel.

 

“Purchaser Schedules” has the meaning set forth in Section 6.1.

 

“Real Property” has the meaning set forth in Section 5.7.

 

“Registered Intellectual Property” has the meaning set forth in Section 5.8.

 

“Sale Order” means those elements of an Order of the Bankruptcy Court, which shall be an Order confirming a chapter 11 plan of reorganization of the Company, (i) authorizing, among other things the sale of the Purchased Assets to Purchaser free and clear of all Encumbrances other than the Permitted Encumbrances and (ii) complying with Section 7.4.

 

“Sales and Use Tax Refund Claim” has the meaning set forth in Section 2.1(o).

 

“Schedules” has the meaning set forth in Section 5.1.

 

“SCI” means Station Casinos, Inc.

 

“SCI APA” means that certain Asset Purchase Agreement among Station Casinos, Inc., those Subsidiaries of Station Casinos Inc. listed in Annex I thereto, and FG Opco Acquisitions LLC, dated as of June 7, 2010, as amended, including by that certain First Amendment to Asset Purchase Agreement, dated as of August 26, 2010.

 

“SCI Plan” means the chapter 11 plan of SCI and its affiliated debtors.

 

“SCI Plan Effective Date” means the date on which the confirmed SCI Plan becomes effective according to its terms.

 

“Tax” and, with correlative meaning, “Taxes” mean (a) all federal, state or local taxes, charges or other assessments, including all net income, gross receipts, capital, sales, use, ad valorem, value added, goods and services, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, severance, stamp, occupation, property and estimated taxes and (b) all interest, penalties, fines, additions to tax or additional amounts imposed by any Tax Authority in connection with any item described in clause (a).

 

“Tax Authority” means any Governmental Entity, instrumentality or employee thereof, charged with the administration of any Law relating to Taxes.

 

“Tax Return” means all returns, declarations, reports, estimates, information returns and statements required to be filed in respect of any Taxes.

 

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“Termination Date” has the meaning set forth in Section 4.5(b).

 

“Transfer Approval” has the meaning set forth in the Recitals.

 

“Transfer Failure” has the meaning set forth in Section 2.6(b).

 

“Transfer Taxes” has the meaning set forth in Section 11.1.

 

“Transferred Employees” has the meaning set forth in Section 9.1(a).

 

“Transition Services Agreement” has the meaning set forth in Section 4.2(d).

 

“Unaudited Financial Information” has the meaning set forth in Section 5.6(a).

 

“Warehouse” means and refers to the storage facilities situated at 3550 West Tompkins Ave., 3345 West Tompkins Ave., 3265 West Tompkins Ave., 3325 West Tompkins Ave., 3285 West Tompkins Ave., 3225 Palms Center Drive, 3185 Palms Center Drive and 4630 Polaris Ave., Las Vegas, Nevada 89103, which storage facilities house certain Equipment owned by the Company and certain other entities.

 

“WARN Act” means the Worker Adjustment and Retraining Notification Act of 1988 and analogous state and local Law.

 

1.2                                 Other Definitional and Interpretive Matters.

 

(a)                                  Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

 

(i)                                     Calculation of Time Period.  When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded.  If the last day of such period is a non-Business Day, the period in question shall end on the next succeeding Business Day.

 

(ii)                                  Dollars.  Any reference in this Agreement to $ shall mean U.S. dollars.

 

(iii)                               Exhibits/Schedules.  All exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.  Any capitalized term used in any Schedule or Exhibit but not otherwise defined therein shall have the meaning ascribed to such term in this Agreement.

 

(iv)                              Gender and Number.  Any reference in this Agreement to gender shall include all genders, and words imparting the singular number only shall include the plural and vice versa.

 

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(v)                                 Headings.  The provision of a Table of Contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized in construing or interpreting this Agreement.  All references in this Agreement to any “Article” or “Section” are to the corresponding Article or Section of this Agreement unless otherwise specified.

 

(vi)                              Herein; Including.  Words such as “herein,” “hereinafter,” “hereof,” “hereby” and “hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words appear, unless the context otherwise requires.  The word “including” shall be deemed to be followed by the words, “without limitation” whenever used in this Agreement or the Schedules hereto.

 

(b)                                 The Parties have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the Parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

 

ARTICLE II
  PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

 

2.1                                 Purchase and Sale of Assets.  On the terms and subject to the conditions set forth in this Agreement, at the Closing, pursuant to the terms of this Agreement, Purchaser shall purchase, acquire and accept from the Company and the Company shall sell, transfer, assign, convey and deliver to Purchaser, free and clear of all Encumbrances (except for Permitted Encumbrances, or Encumbrances related to the Assumed Liabilities which are set forth on Schedule 2.1), all of the Purchased Assets.  “Purchased Assets” shall mean (excluding the Excluded Assets and subject to the qualifications contained in this Section 2.1) all of the Company’s right, title and interest in all of its properties, assets and rights (including those properties, assets and rights related to the Casino Business) which are: (i) except as expressly set forth below, located at the Property, or (ii) intangible or financial assets of the Company expressly set forth in this Section 2.1, including the following:

 

(a)                                  all rights of the Company in the Land, together with all improvements, fixtures and other appurtenances thereto and rights in respect thereof;

 

(b)                                 all Equipment, including the Gaming Equipment and any other Equipment owned by the Company that is held or maintained at the Warehouse;

 

(c)                                  all information management systems or software owned by the Company used in the Casino Business, including the information systems or software set forth on Schedule 2.1(c);

 

(d)                                 all Inventory;

 

(e)                                  all Cage Cash, unrestricted cash, cash equivalents, bank deposits and other cash of the Company;

 

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(f)                                    all rights of the Company under the Assumed Agreements;

 

(g)                                 all security, vendor, utility, and other deposits (including gaming deposits), prepayments (including prepaid gaming taxes or slot or game license fees) or rebates (collectively, “Deposits”) and prepaid payroll and withholding taxes;

 

(h)                                 all Accounts Receivable and other current assets;

 

(i)                                     human resource Documents related to all Transferred Employees, to the extent allowed under applicable Law;

 

(j)                                     all advertising, marketing and promotional materials and all other printed or written materials;

 

(k)                                  all transferable Permits, from all permitting, licensing, accrediting and certifying agencies, and the rights to all data and records held by such permitting, licensing and certifying agencies;

 

(l)                                     all landline telephone numbers;

 

(m)                               the Acquired IP Assets;

 

(n)                                 all goodwill associated with the Casino Business;

 

(o)                                 any and all rights of the Company in respect of outstanding claims for refunds of Nevada sales and use taxes for periods ending on or before the Closing Date as provided for in the petition requests submitted on behalf of the Company to the State of Nevada Department of Taxation, including the outstanding claims for refunds set forth on Schedule 2.1(o) (collectively, the “Sales and Use Tax Refund Claim”);

 

(p)                                 the Customer Database;

 

(q)                                 all rights of the Company under any insurance policies relating to the Casino Business (including health insurance, worker’s compensation insurance and life insurance), and any right of the Company to refunds due with respect to such insurance policies; and

 

(r)                                    except to the extent released pursuant to the SCI Plan, any and all rights, claims, counterclaims, defenses, demands and causes of action of the Company and its bankruptcy estate (i) arising under the Bankruptcy Code or applicable non-bankruptcy state and federal law, including all avoidance claims and related rights and defenses of the Company and its bankruptcy estate arising under Chapter 5 of the Bankruptcy Code and (ii) relating to assets, properties, business or operations of the Company arising out of events occurring on or prior to the Closing Date.

 

2.2                                 Excluded Assets.  Nothing herein contained shall be deemed to sell, transfer, assign or convey the Excluded Assets to Purchaser, and the Company shall retain all right, title

 

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and interest to, in and under the Excluded Assets.  “Excluded Assets” shall mean the following assets of the Company:

 

(a)                                  any and all rights of the Company under this Agreement;

 

(b)                                 the Excluded Agreements and any and all rights thereunder;

 

(c)                                  the Purchase Price, but excluding that portion of the Purchase Price to be held by the Escrow Agent as the FE Escrowed Funds and released in accordance with the provisions of this Agreement and the Escrow Agreement;

 

(d)                                 all rights under or pursuant to all warranties (express or implied), representations and guarantees made by third parties relating to any Excluded Assets;

 

(e)                                  any (i) human resources Documents related to any Employee who is not a Transferred Employee; (ii) Documents that the Company is required by Law to retain or that the Company determines are necessary or advisable to retain, including Tax Returns, financial statements and corporate or other entity filings; provided, that Purchaser shall have the right to make copies of any portions of such retained Documents that relate to the Casino Business or any of the Purchased Assets at Purchaser’s expense and request; and (iii) minute books, ledgers and certificates of ownership of the Company;

 

(f)                                    other than the Sales and Use Tax Refund Claim and other than any amount relating to a Tax paid by Purchaser, any claim, right or interest of the Company in or to any refund, rebate, abatement or other recovery for Taxes, together with any interest due thereon or penalty rebate arising therefrom, for any Tax period (or portion thereof) ending on or before the Closing Date (but excluding prepaid gaming taxes or slot or game license fees);

 

(g)                                 all assets associated with any Company Benefit Plan, including the Company’s rights, title and interests in any (i) assets related to a defined benefit or defined contribution retirement plan and (ii) assets related to non-qualified deferred compensation plan (except with respect to the extent related Liabilities of such Company Benefit Plans are assumed by Purchaser);

 

(h)                                 the assets that are not lawfully transferrable set forth on Schedule 2.2(h);

 

(i)                                     any Contract which the Company is unable to assign to Purchaser due to its inability to obtain any required third party consent to assignment; and

 

(j)                                     the Excluded Intellectual Property.

 

2.3                                 Assumption of Liabilities.  On the terms and subject to the conditions set forth in this Agreement, at the Closing, Purchaser shall assume, effective as of the Closing, and shall timely perform and discharge in accordance with their respective terms, the following Liabilities of the Company (the “Assumed Liabilities”):

 

(a)                                  all Liabilities of the Company under the Assumed Agreements that arise out of or relate to the period from and after the Closing Date, except as provided in Section 2.6;

 

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(b)                                 all Liabilities relating to amounts required to be paid by Purchaser hereunder;

 

(c)                                  all Transfer Taxes applicable to the transfer of the Purchased Assets pursuant to this Agreement;

 

(d)                                 Cure Costs;

 

(e)                                  all Liabilities of the Company with respect to accrued payroll obligations (including accrued payroll Taxes), bonuses, vacation, holiday and other paid time off and severance or other termination pay of the Transferred Employees and any such other Liabilities assumed by Purchaser pursuant to Section 9.1; and

 

(f)                                    all other Liabilities of the Company that arise out of or relate to the period from and after the Closing Date, except for the Excluded Liabilities.

 

2.4                                 Excluded Liabilities.  Notwithstanding anything in this Agreement to the contrary, Purchaser shall not assume, and shall be deemed not to have assumed, any Liabilities of the Company, other than the Assumed Liabilities (the “Excluded Liabilities”).  For the avoidance of doubt, the Excluded Liabilities shall include the following Liabilities:

 

(a)                                  All outstanding Indebtedness and other amounts owing under, and any other Liabilities arising out of, the Credit Agreements;

 

(b)                                 all Liabilities arising out of Excluded Assets, including the Excluded Agreements;

 

(c)                                  all Liabilities of the Company under the Assumed Agreements that arise out of or relate to the period prior to the Closing Date, other than Cure Costs;

 

(d)                                 except as otherwise provided in Article XI, all Liabilities for Taxes of or payable by the Company, and any Liabilities for Taxes relating to the Purchased Assets or the Casino Business for any Tax periods (or portions thereof) ending on or before the Closing Date;

 

(e)                                  all Liabilities arising out of or relating to any Company Benefit Plan (except with respect to Liabilities assumed by Purchaser pursuant to Section 9.1);

 

(f)                                    all Liabilities of the Company with respect to accrued payroll obligations (including accrued payroll Taxes), bonuses, vacation, holiday and other paid time off and severance or other termination pay of the Employees that are not Transferred Employees;

 

(g)                                 all Liabilities of the Company under this Agreement and the Ancillary Agreements;

 

(h)                                 all Liabilities of the Company in respect of Indebtedness under any promissory notes to its members;

 

(i)                                     all Liabilities of the Company set forth on Schedule 2.4; and

 

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(j)                                     all Liabilities of the Company for which Purchaser is not liable pursuant to the express terms of Section 9.1.

 

2.5                                 Designation Right Period.

 

Notwithstanding anything herein to the contrary, but except with respect to the Transition Services Agreement, Purchaser reserves the right, at any time during the period commencing from the date hereof and ending on the earlier of (i) the ninetieth day following the date hereof and (ii) the date on which the Bankruptcy Court initiates a hearing on confirmation of the chapter 11 plan of reorganization of the Company (such period, the “Designation Right Period”), to, upon written notice to the Company, amend the applicable schedules and designate (x) any Contract listed as an Excluded Agreement on Schedule 1.1(d) as an Assumed Agreement (to be listed on Schedule 1.1(c)), and (y) any Contract listed as an Assumed Agreement on Schedule 1.1(c) as an Excluded Agreement (to be listed on Schedule 1.1(d)).

 

2.6                                 Procedures for Assumption of Agreements.

 

(a)                                  At the Closing, the Company shall assume, to the extent not previously assumed by Order of the Bankruptcy Court, and assign to Purchaser the Assumed Agreements pursuant to the Sale Order, it being understood that any Assumed Agreement that is an executory contract or an unexpired lease shall also be assigned to Purchaser pursuant to Section 365 of the Code.  In connection with such assumption and assignment, and subject to any order of the Bankruptcy Court as may be necessary or appropriate, the Company shall cure all monetary defaults under such Assumed Agreements (such amounts, “Cure Costs”) and Purchaser shall provide adequate assurance of the future performance of such Assumed Agreements, it being understood that monetary defaults under any such Assumed Agreement that is an executory contract or an unexpired lease shall be cured to the extent required by Section 365(b) of the Bankruptcy Code and adequate assurance of the future performance of any such contract or lease shall be provided, as required by the Bankruptcy Code.

 

(b)                                 Except as may otherwise be determined by an order of the Bankruptcy Court, nothing herein shall be deemed to require the conveyance, assignment or transfer of any Purchased Asset that by its terms or by operation of Law cannot be conveyed, assigned, transferred or assumed without approval or consent.  Notwithstanding anything in this Agreement to the contrary, to the extent that the sale, assignment, license, sublicense, transfer, conveyance or delivery or attempted sale, assignment, transfer, conveyance or delivery to Purchaser of any asset that would be a Purchased Asset or any claim or right or any benefit arising thereunder or resulting therefrom is prohibited by any applicable Law or would require any governmental or third party authorizations, approvals, consents or waivers and such authorizations, approvals, consents or waivers shall not have been obtained prior to the Closing (any such prohibition, or failure to obtain any such authorization, approval, consent or waiver, a “Transfer Failure”), the Closing shall proceed without the sale, assignment, transfer, conveyance or delivery of such asset unless such failure causes a failure of any of the conditions to Closing set forth in Article X, in which event the Closing shall proceed only if the failed condition is waived by the party entitled to the benefit thereof.  In the event that the failed condition is waived and the Closing proceeds without the transfer or assignment of any such asset, then following the Closing, Purchaser and the Company shall use commercially reasonable efforts,

 

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and cooperate with each other, to obtain promptly such authorizations, approvals, consents and waivers.  Pending such authorization, approval, consent or waiver, the Parties shall cooperate with each other in any mutually agreeable arrangement designed to provide Purchaser with all of the benefits of use of such asset and to the Company the benefits, including any indemnities, that they would have obtained had the asset been conveyed to Purchaser at the Closing.  Once authorization, approval, consent or waiver for the sale, assignment, transfer, conveyance or delivery of any such asset not sold, assigned, transferred, conveyed or delivered at Closing is obtained, the Company shall assign, transfer, convey and deliver such asset to Purchaser at no additional cost.  To the extent that any such asset cannot be transferred or the full benefits or use of any such asset cannot be provided to Purchaser following the Closing pursuant to this Section 2.6(b), then Purchaser and the Company shall enter into such arrangements (including subleasing, sublicensing or subcontracting) to provide to the Parties the economic (taking into account Tax costs and benefits) and operational equivalent, to the extent permitted, of obtaining such authorization, approval, consent or waiver and the performance by Purchaser of the obligations thereunder.  The Company shall hold in trust for and pay to Purchaser promptly upon receipt thereof, all income, proceeds and other monies received by the Company derived from its use of any Purchased Asset in connection with the arrangements under this Section 2.6(b).

 

(c)                                  At Closing, Purchaser shall assume liability for any and all Cure Costs not previously paid by the Company.  The Bankruptcy Court shall retain jurisdiction to determine any disputes regarding Cure Costs.  Notwithstanding the pendency of a dispute regarding any Cure Cost, the Closing may occur.

 

2.7                                 Further Conveyances and Assumptions.

 

(a)                                  From time to time following the Closing, to the extent not transferred to Purchaser and to the extent permitted under applicable Law, the Company shall and shall cause its Affiliates to, make available to Purchaser such data in personnel records of Transferred Employees as is reasonably necessary for Purchaser to effect the transition of such Employees into Purchaser’s records.

 

(b)                                 From time to time following the Closing, the Company and Purchaser shall, and shall cause their respective Affiliates to, execute, acknowledge and deliver all such further conveyances, assignments, consents, notices, assumptions, releases and acquittances and such other instruments, and shall take such further actions, as may be reasonably necessary or appropriate to assure fully to Purchaser and its respective successors or assigns, the transfer of all of the properties, rights, titles, interests, estates, remedies, powers and privileges intended to be conveyed to Purchaser under this Agreement and the Company Documents and to assure fully to the Company and its Affiliates and successors and assigns, the assumption of the liabilities and obligations intended to be assumed by Purchaser under this Agreement and the Company Documents, and to otherwise make effective the transactions contemplated hereby and thereby.

 

2.8                                 Bulk Sales Law.  Purchaser hereby waives, in connection with the transactions contemplated by this Agreement and the Company Documents, compliance by the Company with the requirements and provisions of any “bulk-transfer” provision of Article 6 of the Uniform Commercial Code as it is in effect in the states where the Company owns assets to be conveyed to Purchaser hereunder and other similar bulk transfer notice provisions or Laws of

 

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any jurisdiction that may otherwise be applicable with respect to the sale and transfer of any or all of the Purchased Assets to Purchaser other than bulk-transfer tax notice provisions.  Pursuant to Section 363(f) of the Bankruptcy Code, the transfer of the Purchased Assets shall be free and clear of any security interests in the Purchased Assets, including any liens or claims arising out of the bulk transfer laws, and the parties shall take such steps as may be necessary or appropriate to so provide in the Sale Order.

 

ARTICLE III
  CONSIDERATION

 

3.1                                 Consideration.  The aggregate consideration for the Purchased Assets shall be (a) an amount in cash equal to $500,000,000, plus, if applicable pursuant to the terms of Section 8.11, (i) an amount in cash equal to the May Ticking Fee and (ii) an amount in cash equal to the June Ticking Fee, plus, if applicable pursuant to the terms of Section 8.12, an amount in cash equal to the Gaming Delay Extension Fee (the “Purchase Price”); and (b) the assumption of the Assumed Liabilities.

 

3.2                                 Escrowed Funds; Deposit Commitment.  Pursuant to the terms of the Escrow Agreement, within two (2) Business Days of the date of this Agreement: (a) FE shall have deposited the FE Escrowed Funds with the Escrow Agent by wire transfer of immediately available funds to an account designated by the Escrow Agent; and (b) the Mortgage Lenders shall have entered into, and delivered to the Company (with a copy to the Escrow Agent), the Deposit Commitment Letter.  The FE Escrowed Funds will be released by the Escrow Agent and delivered to either FE or to or at the direction of the Company in accordance with the provisions of this Agreement and the Escrow Agreement. Unless this Agreement has terminated and Section 4.7(c) does not require payment of the Deposit Commitment Funds to the Company, effective as of the earlier of the Transfer Approval and the SCI Plan Effective Date (the earliest of such times, the “Applicable Time”), each Mortgage Lender shall consent to the transfer to the Escrow Agent of such Mortgage Lender’s Ratable Share of the Deposit Commitment Funds and releases its liens with respect to the Deposit Commitment Funds to accommodate the transfer of such funds to the Escrow Agent.  The CP Escrowed Funds shall be held by the Escrow Agent in an account designed by the Escrow Agent.  The CP Escrowed Funds will be released by the Escrow Agent and delivered to either the Mortgage Lenders or to or at the direction of the Company in accordance with the provisions of this Agreement and the Escrow Agreement.

 

3.3                                 Payment of Purchase Price; Assumption of Assumed Liabilities.  On the Closing Date, (a) Purchaser shall pay to the Company, by wire transfer of immediately available funds into an account designated by the Company, an amount equal to the Purchase Price less the amount of the FE Escrowed Funds (the “Closing Payment”), (b) the Escrow Agent shall release and deliver to the Company the FE Escrowed Funds, pursuant to the terms and conditions of the Escrow Agreement, (c) (i) if still in effect, the Deposit Commitment Letter shall terminate in accordance with the terms of the Deposit Commitment Letter and (ii) if the CP Escrowed Funds have been deposited with the Escrow Agent, the Escrow Agent shall release and deliver to the Mortgage Lenders the CP Escrowed Funds, pursuant to the terms and conditions of the Escrow Agreement and (d) Purchaser shall assume the Assumed Liabilities by executing and delivering to the Company the Assignment and Assumption Agreement, which shall be in a form reasonably satisfactory to the Company.

 

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3.4                                 Cure Costs.  (a) On or prior to the Closing, the Company shall pay to the counterparties to each Assumed Agreement all Cure Costs in connection with the assumption by the Company and assignment to Purchaser of such Assumed Agreements, in each case, in accordance with Section 2.6(a), and (b) the Parties acknowledge that the payment of such Cure Costs by the Company will reduce the amount of cash acquired by Purchaser on the Closing Date pursuant to Section 2.1(e).

 

ARTICLE IV
  CLOSING AND TERMINATION

 

4.1                                 Closing Date.  Subject to the satisfaction of the conditions set forth in Sections 10.1, 10.2 and 10.3 (or the waiver thereof by the Party entitled to waive the applicable condition), the closing of the purchase and sale of the Purchased Assets and the assumption of the Assumed Liabilities provided for in Article II (collectively, the “Closing”) shall take place at the offices of Milbank, Tweed, Hadley & McCloy LLP located at 601 South Figueroa Street, Los Angeles, California (or at such other place as the Parties may designate in writing) at 10:00 a.m. (Los Angeles time) on the second Business Day following the satisfaction or waiver of the conditions set forth in Article X (other than conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions), unless another time or date, or both, are agreed to in writing by the Parties.  The date on which the Closing shall be held is referred to in this Agreement as the “Closing Date.”

 

4.2                                 Deliveries by the Company.  At the Closing, the Company shall deliver to Purchaser (or Purchaser shall have otherwise received):

 

(a)                                  a duly executed special warranty deed (transferring the Company Real Property);

 

(b)                                 a duly executed copy of an assignment and assumption agreement (the “Assignment and Assumption Agreement”);

 

(c)                                  a duly executed copy of a bill of sale (the “Bill of Sale”);

 

(d)                                 a duly executed copy of a transition services agreement in substantially the form attached hereto as Exhibit C (the “Transition Services Agreement”);

 

(e)                                  the officer’s certificate required to be delivered pursuant to Section 10.1(b);

 

(f)                                    a duly executed non-foreign person affidavit;

 

(g)                                 a duly executed State of Nevada Declaration of Value in form and substance reasonably satisfactory to Purchaser and the Company;

 

(h)                                 an electronic copy of the Customer Database;

 

(i)                                     all other instruments of conveyance and transfer as may be necessary to convey the Purchased Assets and the Assumed Liabilities to Purchaser;

 

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(j)                                     any Intellectual Property transfer documents necessary to convey the Acquired IP Assets to Purchaser;

 

(k)                                  the consents to the assignment of the Assumed Agreements set forth on Schedule 4.2(k) and any other Assumed Agreements the failure of which to be assigned to Purchaser would, individually or in the aggregate, reasonably be expected to have a material adverse effect on Purchaser, in form and substance reasonable to Purchaser, to the extent that the Bankruptcy Court shall not have entered an order providing that such consents or authorizations are not required; and

 

(l)                                     such other documents as Purchaser may reasonably request with respect to the transactions contemplated by this Agreement.

 

4.3                                 Deliveries by Purchaser.  At the Closing, Purchaser shall deliver to the Company:

 

(a)                                  the Closing Payment, in immediately available funds, as set forth in Section 3.3;

 

(b)                                 a duly executed copy of the Assignment and Assumption Agreement;

 

(c)                                  a duly executed copy of the Bill of Sale;

 

(d)                                 a duly executed copy of the Transition Services Agreement;

 

(e)                                  the officer’s certificate required to be delivered pursuant to Section 10.2(b);

 

(f)                                    all other instruments of conveyance and transfer as may be necessary to convey the Purchased Assets and the Assumed Liabilities to Purchaser;

 

(g)                                 a duly executed State of Nevada Declaration of Value in the form and substance reasonably satisfactory to Purchaser and the Company;

 

(h)                                 any Intellectual Property transfer documents necessary to convey the Acquired IP Assets to Purchaser; and

 

(i)                                     such other documents, instruments and certificates as the Company may reasonably request with respect to the transactions contemplated by this Agreement.

 

4.4                                 License Agreement.  At the Closing, the license agreement, by and between the Company and GCR Gaming, LLC or its Affiliate (the “License Agreement”), shall be entered into by the parties thereto and the License Agreement shall (i) provide that the Company shall have the continued use of the “Green Valley Ranch” name in exchange for a license fee, (ii) include such other terms and conditions as set forth on Schedule 4.4, with such changes thereto as the parties to the License Agreement may approve, and (iii) be duly assigned and transferred by the Company to Purchaser with the written consent of GCR Gaming, LLC or its Affiliate; provided, however, that failure of GCR Gaming, LLC or its Affiliate to enter into the

 

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License Agreement or consent to its assignment to Purchaser shall not relieve Purchaser of its obligations under this Agreement.

 

4.5                                 Termination of Agreement.  This Agreement may be terminated prior to the Closing only as follows:

 

(a)                                  by mutual written consent of the Company and Purchaser;

 

(b)                                 by either the Company or Purchaser, if the transactions contemplated hereby have not been consummated on or prior to 5:00 p.m. (New York City time) on the earlier of (i) the second Business Day following the SCI Plan Effective Date and (ii) June 30, 2011 (in either case, as the same may be extended pursuant to this Section 4.5(b), the “Termination Date”); provided, however, that, if the Closing shall not have occurred due to the failure to obtain any necessary Permit, consent or approval of a Gaming Authority despite the non-terminating Party hereto having diligently performed each of its respective obligations set forth under Section 8.4 (a “Gaming Delay”) and if all other conditions to the respective obligations of the Parties to close hereunder that are capable of being fulfilled shall have been so fulfilled or waived, then, at the option of either Purchaser or, so long as the Financing Commitments or commitments for Alternative Financing are in effect (and shall remain in effect for the duration of the extension period), the Company, the Termination Date may be extended for all purposes hereunder by a reasonable period necessary to obtain such necessary Permit, consent or approval of a Gaming Authority not to exceed three (3) months and no Party may terminate this Agreement pursuant to this Section 4.5(b) until the occurrence of such Termination Date, as so extended pursuant to this proviso;

 

(c)                                  by the Company, and, if not by reason of any breach by Purchaser of its representations and warranties under Sections 6.9 and 6.10 of this Agreement or its obligations under Sections 8.4 and 8.5 of this Agreement, the Purchaser, if any Governmental Entity issues an Order or takes any other action, in either case, denying Purchaser any Gaming Approval;

 

(d)                                 by either the Company or Purchaser, if a court of competent jurisdiction or other Governmental Entity shall have issued a Final Order or taken any other nonappealable final action, in each case, having the effect of permanently restraining, enjoining or otherwise prohibiting the Closing and the transactions contemplated hereby; provided, that if such Final Order or other nonappealable final action shall have been issued or taken by such Governmental Entity due to a breach of any representation, warranty, covenant or agreement contained in this Agreement by Purchaser or the Company, then the breaching Party may not terminate this Agreement pursuant to this Section 4.5(d); provided  further, that this Section 4.5(d) does not govern the denial of a Gaming Approval to Purchaser (or any other action taken or omitted by any Gaming Authority) as specified in Section 4.5(c), which denial (or other action or omission) shall be governed instead exclusively by the terms of such Section;

 

(e)                                  by Purchaser, if the Company has breached any representation, warranty, covenant or agreement contained in this Agreement which breach (i) would result in a failure of a condition set forth in Section 10.1 to be satisfied and (ii) is not cured within thirty (30) calendar days after written notice thereof; provided, however, that if such breach cannot reasonably be cured within such thirty (30) day period but can be reasonably cured prior to the Termination

 

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Date, and the Company is diligently proceeding to cure such breach, this Agreement may not be terminated pursuant to this Section 4.5(e); provided, further, that Purchaser’s right to terminate this Agreement under this Section 4.5(e) shall not be available if, (i) at the time of such intended termination, the Company has (or would have after the passage of time) the right to terminate this Agreement under Section 4.5(f) or (ii) Purchaser or a Purchaser Knowledge Person had actual knowledge, as of the date of this Agreement, that the representation or warranty which is the subject of the intended termination was not true and correct in all material respects;

 

(f)                                    by the Company, if Purchaser has breached any representation, warranty, covenant or agreement contained in this Agreement which breach (i) would result in a failure of a condition set forth in Section 10.2 to be satisfied and (ii) is not cured within thirty (30) calendar days after written notice thereof; provided, however, that if such breach cannot reasonably be cured within such thirty (30) day period but can be reasonably cured prior to the Termination Date, and Purchaser is diligently proceeding to cure such breach, this Agreement may not be terminated pursuant to this Section 4.5(f); provided, further, that (1) no cure period shall apply to Purchaser’s obligations to pay the Closing Payment at the Closing on the Closing Date and (2) the Company’s right to terminate this Agreement under this Section 4.5(f) shall not be available if, at the time of such intended termination, Purchaser has (or would have after the passage of time) the right to terminate this Agreement under Section 4.5(e);

 

(g)                                 by either the Company or Purchaser, if the Bankruptcy Court denies the motion to enter the Sale Order;

 

(h)                                 by either the Company or Purchaser if the confirmation order in form and substance acceptable to Purchaser confirming the chapter 11 plan of reorganization of the Company has not been entered by the Bankruptcy Court by June 15, 2011; or

 

(i)                                     by Purchaser, if (i) the SCI Plan has been terminated or (ii) if there has been any material amendment or modification of the SCI Plan.

 

4.6                                 Procedure Upon Termination.  In the event of termination by the Company or Purchaser, or both, pursuant to Section 4.5, written notice thereof shall be given to the other Party or Parties, and this Agreement shall terminate (except that the provisions of Article I, this Section 4.6, Section 4.7, Section 8.8 and Article XII shall survive any such termination and shall be enforceable hereunder), without further action by the Company or the Purchaser.  If this Agreement is terminated as provided herein each Party shall redeliver or destroy all documents, work papers and other material of the other Party relating to the transactions contemplated hereby, whether so obtained before or after the execution hereof, to the Party furnishing the same; provided that a Party may retain a reasonable number of copies of all such documents, for purposes of actual or potential litigation relating to or as reasonably required by such Party to enforce its rights and remedies under this Agreement and to the extent a Party reasonably believes it is required to do so under any applicable Law, court, regulation or regulatory authority or to comply with existing internal document retention policies.

 

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4.7                                 Effect of Termination.

 

(a)                                  In the event that this Agreement is validly terminated as provided herein, then each of the Parties shall be relieved of its duties and obligations arising under this Agreement after the date of such termination (except that the provisions of Article I, Section 4.6, Section 4.7, Section 8.8 and Article XII shall survive any such termination and shall be enforceable hereunder) and, except as provided herein (including Article XII), such termination shall be without liability to Purchaser or the Company.

 

(b)                                 Upon the termination of this Agreement pursuant to Section 4.5(a), Section 4.5(b), Section 4.5(c), Section 4.5(d) (other than due to a breach of any representation, warranty, covenant or agreement contained in this Agreement by Purchaser), Section 4.5(e), Section 4.5(g) (other than due to a breach of any representation, warranty, covenant or agreement contained in this Agreement by Purchaser), Section 4.5(h), or, except as set forth below, Section 4.5(i), subject to the conditions and upon the terms set forth in the Escrow Agreement (including the provisions in Section 5(c) thereof regarding resolution of disputes of whether FE is entitled to payment of the FE Escrowed Funds and the Mortgage Lenders are entitled to the payment of the CP Escrowed Funds, if applicable) (i) the Escrow Agent shall release and pay the FE Escrowed Funds and all interest accrued thereon to FE in accordance with the terms of the Escrow Agreement and (ii) (A) if still in effect, the Deposit Commitment Letter shall terminate in accordance with the terms of the Deposit Commitment Letter and (B) if the CP Escrowed Funds have been deposited with the Escrow Agent, the Escrow Agent shall release and pay to each Mortgage Lender its Ratable Share of the CP Escrowed Funds and all interest accrued thereon in accordance with the terms of the Escrow Agreement.

 

(c)                                  Upon the termination of this Agreement pursuant to Section 4.5(d) (if due to a breach of any representation, warranty, covenant or agreement contained in this Agreement by Purchaser), Section 4.5(f), Section 4.5(g) (if due to a breach of any representation, warranty, covenant or agreement contained in this Agreement by Purchaser), Section 4.5(i)(i) if the SCI Plan is terminated by the Sellers (as defined in the SCI APA) under Section 4.4(f) of the SCI APA, or Section 4.5(i)(ii), if, notwithstanding any material amendment or modification to the SCI Plan, Purchaser acquires the New Opco Acquired Assets (as defined in the SCI Plan), subject to the conditions and upon the terms set forth in the Escrow Agreement (including the provisions in Section 5(b) thereof regarding resolution of disputes of whether the Company is entitled to payment of the FE Escrowed Funds and the CP Escrowed Funds) (i) the Escrow Agent shall release and pay the FE Escrowed Funds and all interest accrued thereon to or at the direction of the Company in accordance with the terms of the Escrow Agreement and (ii) (A) if the Deposit Commitment Letter is still in effect, the Escrow Agent shall accept the Deposit Commitment Funds pursuant to the Deposit Commitment Letter and each Mortgage Lender shall, at the Applicable Time, consent to the transfer following the Applicable Time to the Escrow Agent of such Mortgage Lender’s Ratable Share of the Deposit Commitment Funds and release its liens with respect to the Deposit Commitment Funds to accommodate the transfer of such funds to the Escrow Agent (it being understood and agreed that such Deposit Commitment Funds will be delivered and paid only if and when funds are or have been paid to fund such amounts under the SCI Plan, as contemplated by the Deposit Commitment Letter) and upon receipt by the Escrow Agent of the Deposit Commitment Funds, the Escrow Agent shall distribute such funds and all interest accrued thereon to or at the direction of the Company in

 

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accordance the terms of the Escrow Agreement or (B) if the Deposit Commitment Letter has been terminated in accordance with its terms due to the deposit of the CP Escrowed Funds with the Escrow Agent, the Escrow Agent shall release and pay the CP Escrowed Funds and all interest accrued thereon to or at the direction of the Company in accordance with the terms of the Escrow Agreement, and the payment of the CP Escrowed Funds, together with the payment of the FE Escrowed Funds, shall (subject to Section 12.2) constitute the Company’s sole and exclusive remedy hereunder.

 

(d)                                 Nothing in this Section 4.7 shall relieve the Company of any liability for a breach of this Agreement.  The Company will remain liable for any such breach and Purchaser may seek such remedies, including damages, against the other with respect to any such breach as are provided in this Agreement (including Article XII) or as are otherwise available at law.

 

(e)                                  The Confidentiality Agreement shall survive any termination of this Agreement in accordance with the terms thereof and nothing in this Section 4.7 shall relieve Purchaser or its Affiliates of their respective obligations under the Confidentiality Agreement.

 

ARTICLE V
  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

5.1                                 The Company’s Representations and Warranties.  The Company represents and warrants to Purchaser that the statements contained in this Article V are correct and complete as of the date of this Agreement and as of the Closing Date, except, as expressly set forth in the disclosure schedules delivered by the Company to Purchaser on the date hereof (the “Schedules”).  The information disclosed in any numbered part shall be deemed to relate to and to qualify only the particular representation or warranty set forth in the corresponding numbered section in this Agreement; provided, however, any matter disclosed in a Schedule by the Company shall be deemed to constitute disclosure against any other representation and warranty of the Company to the extent it is reasonably apparent on the face of such disclosure that the matter disclosed is relevant to such other representation and warranty of the Company.

 

5.2                                 Organization and Good Standing.  The Company is a limited liability corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has all requisite limited liability company power and authority to own, lease and operate its properties and to carry on its business as now conducted.  The Company has delivered to Purchaser true, complete and correct copies of its organizational documents as in effect on the date hereof.

 

5.3                                 Authorization of Agreement.  The Company has all requisite limited liability company power and authority to execute and deliver this Agreement and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by the Company in connection with the consummation of the transactions contemplated by this Agreement (the “Company Documents”), to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.  The execution and delivery of this Agreement and the Company Documents and the consummation of the transactions contemplated hereby and thereby will be duly authorized by all requisite limited liability company action on the part of the Company prior to the Closing.  This Agreement has

 

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been, and each of the Company Documents will be at or prior to the Closing, duly executed and delivered by the Company and (assuming the due authorization, execution and delivery by the other Parties hereto and thereto, the approval of the Bankruptcy Court and entry of the Sale Order), this Agreement constitutes, and each of the Company Documents when so executed and delivered will constitute, legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

 

5.4                                 Conflicts; Consents of Third Parties.

 

(a)                                  Except as set forth on Schedule 5.4(a), none of the execution and delivery by the Company of this Agreement or the Company Documents, the consummation of the transactions contemplated hereby or thereby, or compliance by the Company with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a material benefit under, or give rise to any obligation of the Company to make any payment under, or to the increased, additional, accelerated or guaranteed rights or entitlements of any Person under, or result in the creation of any Encumbrances upon any of the properties or assets of the Company, under any provision of (i) the certificate of formation and operating agreement of the Company, (ii) any Material Contract to which the Company is a party or by which any of the Purchased Assets is bound or (iii) any applicable Law, except, in the case of clauses (ii) and (iii), where such conflicts, violations, defaults, terminations or cancellations would not, individually and in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

(b)                                 Except as set forth on Schedule 5.4(b), no consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any Governmental Entity is required on the part of the Company in connection with (i) the execution and delivery of this Agreement or the Company Documents, the compliance by the Company with any of the provisions hereof or thereof, the consummation of the transactions contemplated hereby or the taking by the Company of any other action contemplated hereby, or (ii) the continuing validity and effectiveness immediately following the Closing of any Material Contract or material Permit of the Company, except for (i) compliance with the applicable requirements of the HSR Act or any other applicable Antitrust Law and (ii) for such other consents, waivers, approvals, Orders, Permits, authorizations, declarations, filings and notifications, where the failure of which to be obtained or made would not, individually and in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

5.5                                 Title to Purchased Assets.  Except as set forth on Schedule 5.5, the Company has good and marketable title to, or a valid leasehold interest in, all of the tangible personal property constituting Purchased Assets (other than the Company Real Property and Intellectual Property, representations with respect to which are made in Sections 5.7 and 5.8).  Immediately prior to Closing, the Company will have, and, upon delivery to Purchaser on the Closing Date of the instruments of transfer contemplated by Section 4.2, and subject to the terms of the Sale Order

 

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and except as otherwise contemplated in Section 2.6(b), the Company will thereby transfer to Purchaser, good title to, or, in the case of property leased or licensed by the Company, a valid leasehold or licensed interest in, all of the Purchased Assets, free and clear of all Encumbrances, except (a) as set forth on Schedule 5.5, (b) for the Assumed Liabilities, and (c) for Permitted Encumbrances.

 

5.6                                 Financial Statements.

 

(a)                                  Schedule 5.6(a) contains a true and complete copy of (i) the audited balance sheet of the Company as of, and statement of income and cash flow for the twelve (12) month periods ending, December 31, 2009 (the “Audited Financial Information”) and (ii) the unaudited balance sheets of the Company as of, and statements of income and cash flow for the three (3) month periods ending, March 31, 2010, June 30, 2010 and September 30, 2010 (collectively, the “Unaudited Financial Information” and together with the Audited Financial Information, the “Financial Information”).  Except as noted therein, the Financial Information was prepared in accordance with GAAP in effect at the time of such preparation applied on a consistent basis throughout the periods involved (except as may be indicated in the notes to the Audited Financial Information and for the lack of normal year-end adjustments, notes, and other presentation items in the Unaudited Financial Information) and fairly presented in all material respects the consolidated financial position and results of operations of the Company as of each such date and for the periods covered thereby.

 

(b)                                 For the purposes hereof, the audited balance sheet of the Company as of December 31, 2009 is referred to as the “Balance Sheet” and December 31, 2009 is referred to as the “Balance Sheet Date”.

 

(c)                                  Except as reflected or reserved against in the Balance Sheet or in the notes thereto, there are no Liabilities against, relating to or affecting the Company or any of its assets and properties, other than Liabilities incurred in the Ordinary Course of Business that individually and in the aggregate are not material to the Company.

 

5.7                                 Real Property.

 

(a)                                  Schedule 1.1(g) sets forth an accurate and complete list and description of the real property and interests in real property owned in fee by the Company (the “Real Property”).  The Company has fee simple title to the Real Property, free and clear of all Encumbrances, except for (i) Permitted Encumbrances, (ii) the Assumed Liabilities and (iii) other Encumbrances that will be released or discharged at or prior to the Closing.  The Company has not received any written or oral notices that any condemnation, eminent domain or similar proceeding affecting all or any material portion of the Real Property is pending or threatened.  Except as set forth in Schedule 5.7 and other than rights to possession granted to overnight guests at the Property, the Company has not leased or otherwise granted to any person any leasehold interest in any Real Property.

 

(b)                                 The Company does not lease any real property or interests in real property.

 

5.8                                 Intellectual Property.  Schedule 1.1(a) sets forth the Intellectual Property registered with the United States Patent and Trademark Office and applications therefor and

 

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Internet domain names (collectively, the “Registered Intellectual Property”) that are owned by the Company and that shall be transferred to Purchaser pursuant to the transactions contemplated by this Agreement.  The Company owns or possesses adequate and enforceable rights to use each item of Registered Intellectual Property set forth in Schedule 1.1(a), and to the Company’s Knowledge, no item of such Registered Intellectual Property is being infringed by any other Person.  To the Knowledge of the Company, the Company has not entered into any contract, taken any action or failed to take any action that gives (or would give, with the delivery of notice or passage of time) a third party any valid claim against any item of Registered Intellectual Property.

 

To the Knowledge of the Company, neither the Company nor its business operations is infringing any Intellectual Property of any other Person in connection with the conduct of the Casino Business.

 

5.9                                 Agreements, Contracts and Commitments.

 

(a)                                  All Contracts that are Material Contracts are listed in Schedule 5.9.

 

(b)                                 Except as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Material Contracts are valid and binding obligations of the Company, enforceable by the Company in accordance with their respective terms, subject, as to enforcement, to (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and (ii) general principles of equity (regardless of whether enforcement is sought in equity or at law).

 

(c)                                  Except as set forth in Schedule 5.9, (i) the Company is not (with or without the lapse of time or the giving of notice, or both) in default under any of the Material Contracts and (ii) to the Knowledge of the Company, no other party to any of the Material Contracts is (with or without the lapse of time or the giving of notice, or both) in default under any of the Material Contracts.

 

(d)                                 The Company has provided or made available to Purchaser a true and correct copy of all Material Contracts disclosed on Schedule 5.9.

 

(e)                                  All Contracts that are Affiliate Agreements are listed on Schedule 1.1(b).

 

5.10                           Litigation; Orders.  Except as set forth in Schedule 5.10, (a) there is no Legal Proceeding pending or, to the Knowledge of the Company, threatened against the Company or any of its properties or assets (other than the Excluded Assets) that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and (b) there is no Order outstanding against the Company that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  The Company is not in default under any Order, except for any such default or defaults that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

5.11                           Environmental Matters.  Except as set forth in Schedule 5.11, and except as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect (a) the Company is in compliance with all applicable Environmental Laws, (b) the Company has

 

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obtained, maintains and complies in all material respects with all permits, licenses and approvals required under applicable Environmental Laws for its business and operations, (c) in the past three (3) years the Company has not received any written notice with respect to the business of, or any property owned or leased by, the Company from any Governmental Entity or third party alleging that the Company is not in compliance with any Environmental Law or has any material liability under any Environmental Law and (d) to the Knowledge of the Company, the Company has not caused any “release” of a “hazardous substance,” as such terms are defined under the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et  seq., as amended, on any of the Real Property that requires remediation or investigation under Environmental Laws.  The representations and warranties in this Section 5.11 constitute the sole representations and warranties of the Company concerning environmental matters.

 

5.12                           Labor Matters.

 

(a)                                  Except as set forth in Schedule 5.12(a), (i) there are no Collective Bargaining Agreements or employment agreements to which the Company is a party or by which the Company is bound, (ii) to the Knowledge of the Company, there is no labor strike, slowdown, work stoppage or lockout pending or threatened against the Company which would be reasonably likely to have, individually or in the aggregate, a Material Adverse Effect and (iii) there is no Legal Proceeding related to the Company’s employment practices pending or, to the Knowledge of the Company, threatened against the Company, that would be reasonably likely to have, individually or in the aggregate, a Material Adverse Effect.

 

(b)                                 Except as set forth in Schedule 5.12(b), to the Company’s Knowledge, the Company has not taken any action, corporate or otherwise, that could reasonably be expected to result in an involuntary termination of employment of a enough Employees (beyond normal turnover) prior to the Closing Date to give rise to any Liability under the WARN Act.

 

5.13                           Employee Benefits.

 

(a)                                  Schedule 5.13 sets forth an accurate and complete list of all (i) “employee welfare benefit plans,” within the meaning of Section 3(1) of ERISA; (ii) “employee pension benefit plans,” within the meaning of Section 3(2) of ERISA; and (iii) bonus, stock option, stock purchase, restricted stock, incentive, fringe benefit, profit-sharing, pension or retirement, deferred compensation, medical, life insurance, disability, accident, salary continuation, severance, accrued leave, vacation, sick pay, sick leave, supplemental retirement, unemployment and other material employee benefit plans, programs, agreements and arrangements (whether or not insured) maintained by (i) the Company or (ii) an ERISA Affiliate of the Company for the benefit of employees or former employees of the Company.  The plans, programs, agreements and arrangements described in the preceding sentence are referred to herein individually as a “Company Benefit Plan” or, collectively, as the “Company Benefit Plans.”

 

(b)                                 With respect to each Company Benefit Plan, the Company has, to the extent applicable, made available to Purchaser a complete copy of:  (i) each Company Benefit Plan; (ii) the most recent Annual Return/Report (Form 5500 Series) document and amendments thereto, if any; (iii) the current summary plan description and any material modifications thereto,

 

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if any; (iv) the most recent annual financial and/or actuarial report, if any; and (v) the most recent determination letter from the IRS, if any.

 

(c)                                  No Company Benefit Plan is a “qualified plan” within the meaning of Section 401(a) of the Code.

 

(d)                                 Except as set forth in Schedule 5.13, neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby could reasonably be expected (either alone or in conjunction with any other event) result in, cause the accelerated vesting, funding or delivery of, or increase the amount or value of, any payment or benefit to any employee, officer or director of the Company.

 

(e)                                  No Company Benefit Plan is subject to Title IV of ERISA.  No Purchased Assets are subject to any lien under the Code or ERISA with respect to any “employee benefit plan” as set forth in Section 3(3) of ERISA that is sponsored or maintained by the Company or any of its ERISA Affiliates.  No ERISA Affiliate of the Company maintains or otherwise has any liability with respect to an employee benefit plan that is subject to Title IV of ERISA.

 

(f)                                    No Company Benefit Plan is an “employee welfare benefit plan” (as defined in Section 3(1) of ERISA) that provides or would provide benefits to or on behalf of any current or former employee following retirement or other termination of employment (other than to the extent required by Section 4980B of the Code).

 

5.14                           Financial Advisors.  Except as set forth on Schedule 5.14, no Person has acted, directly or indirectly, as a broker, finder or financial advisor for the Company in connection with the transactions contemplated by this Agreement and no Person acting on behalf of the Company is entitled to any fee or commission or like payment from Purchaser in respect thereof.  The Company shall be liable for any fees paid to any Persons in connection with any arrangement set forth on Schedule 5.14.

 

5.15                           Permits; Compliance with Laws.  The Company holds all permits, findings of suitability, licenses, orders and approvals of all Governmental Entities (including all authorizations under Gaming Laws) (collectively, “Permits”), necessary to conduct the Casino Business in the manner in which it is currently conducted, except for such Permits, the failure of which to hold, would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, each of which is in full force and effect in all material respects, and, except as set forth on Schedule 5.15, to the Company’s Knowledge, no event has occurred that permits, or upon the giving of notice or passage of time or both, would permit revocation, non-renewal, modification, suspension, limitation or termination of any Permit of the Company that currently is in effect, the loss of which, either individually or in the aggregate, would be reasonably likely to have a Material Adverse Effect.  Except as set forth on Schedule 5.15, the Company is in compliance with the terms of its Permits, except for such failures to comply which would not, individually and in the aggregate, be reasonably likely to have a Material Adverse Effect.  To the Company’s knowledge, and except as set forth in Schedule 5.15, the businesses conducted by the Company are not being conducted in violation of any applicable Law of any Governmental Entity (including any Gaming Laws or labor Laws), except for possible violations which, individually and in the aggregate, do not and would not be reasonably

 

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likely to have a Material Adverse Effect.  Except as set forth on Schedule 5.15, the Company has not received a notice of any investigation or review by any Governmental Entity with respect to the Company or the Casino Business that is pending, and, to the Knowledge of the Company, no investigation or review is threatened, nor has any Governmental Entity indicated any intention to conduct the same, other than those the outcome of which would not, individually or in the aggregate, be reasonably likely to have a Material Adverse Effect.

 

5.16                           Taxes.

 

(a)                                  The Company is a partnership for federal income tax purposes.

 

(b)                                 (i) With respect to the Company and its assets and Liabilities, all Tax Returns required to be filed during the five (5) year period preceding the Closing Date were or will be timely filed and all such Tax Returns are true, complete and correct in all material respects; and (ii) all Taxes required by Law to be paid have been timely paid.

 

(c)                                  There is no action, suit, proceeding, investigation, audit, written claim or assessment pending or, to the Knowledge of the Company, proposed with respect to Taxes of the Company or its assets and Liabilities, and the Company has not received any written notice from any taxing authority or Governmental Entity that it intends to conduct an audit or investigation.

 

(d)                                 There are no waivers or extensions of, or agreements that have the effect of waiving or extending, any applicable statute of limitations for the assessment or collection of Taxes with respect to any Tax Return regarding the Company or its assets and Liabilities that remain in effect.

 

(e)                                  The Company has complied in all material respects with all Laws relating to the payment and withholding of any and all Taxes and all such withholding Taxes have been or shall be duly and timely paid to the proper taxing authority or Governmental Entity.

 

5.17                           Bankruptcy Notices.  Subject to the entry of the Sale Order and any order approving the assumption and assignment of the Assumed Agreements, the Company will make commercially reasonable efforts to comply with all requirements of the Bankruptcy Code and Federal Rules of Bankruptcy Procedure in connection with obtaining approval of the sale of the Purchased Assets (including the assumption and assignment to Purchaser of any Assumed Agreements) to Purchaser pursuant to this Agreement.

 

5.18                           Sufficiency of Assets.  The Purchased Assets, together with the services contemplated under the Transition Services Agreement and the rights under the License Agreement, are sufficient for Purchaser to conduct the Casino Business in all material respects from and after the Closing Date without interruption and in the Ordinary Course of Business as it has been conducted by the Company.

 

5.19                           No Other Representations or Warranties; Schedules.  (a) Except for the representations and warranties contained in this Article V (as modified by the Schedules hereto), neither the Company nor any other Person makes any other express or implied representation or warranty with respect to the Company, the Casino Business, the Purchased Assets (including the value, condition or use of any Purchased Asset), the Assumed Liabilities or the transactions

 

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contemplated by this Agreement, and the Company disclaim any other representations or warranties, whether made by the Company, any Affiliate of the Company or any of their respective officers, directors, employees, agents or representatives.  Except for the representations and warranties contained in this Article V (as modified by the Schedules hereto), the Company (i) expressly disclaims and negates any representation or warranty, expressed or implied, at common law, by statute or otherwise, relating to the condition of the Purchased Assets (including any implied or expressed warranty of merchantability or fitness for a particular purpose, or of the probable success or profitability of the ownership, use or operation of the Purchased Assets by Purchaser after the Closing), and (ii) disclaims all liability and responsibility for any representation, warranty, projection, forecast, statement or information made, communicated or furnished (orally or in writing) to Purchaser or its Affiliates or representatives (including any opinion, information, projection or advice that may have been or may be provided to Purchaser by any director, officer, employee, agent, consultant or representative of the Company or any of its Affiliates).  The Company makes no representations or warranties to Purchaser regarding the probable success or future profitability of the Casino Business.  The disclosure of any matter or item in any Schedule hereto shall not be deemed in and of itself to constitute an acknowledgment that any such matter is required to be disclosed or is material or that such matter would result in a Material Adverse Effect.

 

(b)                                 In connection with Purchaser’s review of the Company and the Purchased Assets, Purchaser has received or may receive from the Company certain projections, forward-looking statements and other forecasts and certain business plan information.  Purchaser acknowledges that (i) there are uncertainties inherent in attempting to make such estimates, projections and other forecasts and plans, (ii) Purchaser is familiar with such uncertainties, (iii) Purchaser is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections and other forecasts and plans so furnished to it (including the reasonableness of the assumptions underlying such estimates, projections, forecasts or plans), and (iv) Purchaser shall have no claim against the Company with respect thereto.  Accordingly, Purchaser acknowledges that the Company makes no representation or warranty with respect to such estimates, projections, forecasts or plans (including the reasonableness of the assumptions underlying such estimates, projections, forecasts or plans).

 

ARTICLE VI
  REPRESENTATIONS AND WARRANTIES OF PURCHASER

 

6.1                                 Purchaser’s Representations and Warranties.  Purchaser represents and warrants to the Company that the statements contained in this Article VI are correct and complete as of the date of this Agreement and as of the Closing Date, except as expressly set forth in (i) this Article VI and (ii) the disclosure schedules delivered by Purchaser to the Company on the date hereof (the “Purchaser Schedules”).  The information disclosed in any numbered part shall be deemed to relate to and to qualify only the particular representation or warranty set forth in the corresponding numbered section in this Agreement; provided, however, any matter disclosed in a Purchaser Schedule by Purchaser shall be deemed to constitute disclosure against any other representation and warranty of Purchaser to the extent it is readily apparent on the face of such disclosure that the matter disclosed is relevant to such other representation and warranty of Purchaser.

 

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6.2                                 Organization and Good Standing; Ownership.

 

(a)                                  Purchaser is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Nevada and has all requisite limited liability company power and authority to own, lease and operate its properties and to carry on its business as now conducted.

 

(b)                                 Purchaser is either directly or indirectly owned by Station Casinos LLC.

 

6.3                                 Authorization of Agreement; No Vote Required.  Purchaser has full power and authority to execute and deliver this Agreement and each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by Purchaser in connection with the consummation of the transactions contemplated by this Agreement (the “Purchaser Documents”), to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.  This Agreement has been, and each Purchaser Document will be at or prior to the Closing, duly authorized by all requisite limited liability company action and executed and delivered by Purchaser, and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each Purchaser Document when so executed and delivered will constitute, the legal, valid and binding obligations of Purchaser, enforceable against Purchaser in accordance with their respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).  Except as may have already been obtained, no vote of the Board of Directors for similar governing body), equity holders or investment committee of Purchaser or any of its Affiliates is required by law, applicable organizational documents or otherwise in order for Purchaser to duly consummate the transactions contemplated by this Agreement.

 

6.4                                 No Knowledge of Misrepresentations or Omissions.  As of the date of this Agreement, neither Purchaser nor any of the Purchaser Knowledge Persons has any actual knowledge (i) that any representation or warranty of the Company contained in this Agreement or any Ancillary Agreement is not true and correct in all material respects or (ii) of any material errors in, or material omissions from the Schedules.  Each of the Purchaser Knowledge Persons shall be presumed to have reviewed and understood such representations, warranties and Schedules.

 

6.5                                 Conflicts; Consents of Third Parties.

 

(a)                                  None of the execution and delivery by Purchaser of this Agreement or the Purchaser Documents, the consummation of the transactions contemplated hereby or thereby, or compliance by Purchaser with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination or cancellation under any provision of (i) the certificate of formation and operating agreement of Purchaser, (ii) any contract or Permit to which Purchaser is a party or by which Purchaser or its properties or assets is bound or subject to or (iii) any applicable Law, other than, in the case of clauses (ii) and (iii), such conflicts, violations, defaults, terminations or

 

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cancellations as would not reasonably be expected to have an adverse effect on the ability of Purchaser to perform its obligations under this Agreement or the Purchaser Documents or to consummate the transactions contemplated hereby or thereby.

 

(b)                                 Except as set forth on Schedule 6.5(b), no consent, waiver, approval, Order, Permit or authorization of, or declaration or filing with, or notification to, any Person or Governmental Entity is required on the part of Purchaser in connection with the execution and delivery of this Agreement or the Purchaser Documents, the compliance by Purchaser with any of the provisions hereof or thereof, the consummation of the transactions contemplated hereby or the taking by Purchaser of any other action contemplated hereby, or for Purchaser to conduct the Casino Business, except for compliance with the applicable requirements of the HSR Act or any other applicable Antitrust Law, and except to the extent the same would not reasonably be expected to have an adverse effect on the ability of Purchaser to perform its obligations under this Agreement or the Purchaser Documents or to consummate the transactions contemplated hereby or thereby.

 

6.6                                 Litigation.  There are no Legal Proceedings pending or, to the knowledge of Purchaser, threatened against Purchaser, or to which Purchaser is otherwise a party before any Governmental Entity, which, if adversely determined, would reasonably be expected to have an adverse effect on the ability of Purchaser to perform its obligations under this Agreement or the Purchaser Documents or to consummate the transactions hereby or thereby.  Purchaser is not subject to any Order of any Governmental Entity except to the extent the same would not reasonably be expected to have an adverse effect on the ability of Purchaser to perform its obligations under this Agreement or the Purchaser Documents or to consummate the transactions contemplated hereby or thereby.

 

6.7                                 Financial Advisors.  No Person has acted, directly or indirectly, as a broker, finder or financial advisor for Purchaser in connection with the transactions contemplated by this Agreement and no Person acting on behalf of Purchaser is entitled to any fee or commission or like payment from the Company in respect thereof.

 

6.8                                 Financial Capability; Financing Commitments.

 

(a)                                  Purchaser (i) has, and at Closing shall have, sufficient financial resources, taking into account the Financing Commitments, available to pay the Purchase Price and any expenses incurred by Purchaser in connection with the transactions contemplated by this Agreement, and (ii) has, and at Closing shall have, the resources and capabilities (financial or otherwise) to perform its obligations hereunder.

 

(b)                                 Purchaser’s financial resources include written commitments for equity and debt financing (the “Financing Commitments”) for the financing (which financing may include or be comprised exclusively of, without limitation, debt or equity financing to be provided by third parties, the “Financing”) reasonably necessary to consummate the transactions contemplated hereby.  Purchaser has provided true, accurate and complete copies of such Financing Commitments to the Company.  Neither Purchaser nor any of its Affiliates has made any material misrepresentation in connection with obtaining such Financing Commitments.  None of the Financing Commitments has been amended, modified or terminated prior to the date

 

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of this Agreement, and the respective commitments contained in the Financing Commitments have not been modified, withdrawn or rescinded in any respect.  As of the date hereof, the Financing Commitments, if in the form of Contracts, are in full force and effect and no event has occurred which, with or without notice, lapse of time (other than the expiration of the term thereof) or both, would constitute a default on the part of Purchaser or any of its Affiliates under any of the Financing Commitments.

 

(c)                                  The Deposit Commitment Letter is valid, binding and enforceable, and the parties thereto have been duly authorized to perform their obligations thereunder, except, to the extent necessary or appropriate, by Order of the Bankruptcy Court.

 

6.9                                 Licensability of Purchaser and Principals.  Schedule 6.9 sets forth a list of each Affiliate of Purchaser that will be required to be licensed, found suitable or qualified under all applicable Gaming Laws in order to own or operate the Casino Business.  Neither Purchaser nor any of its current representatives or Affiliates has been denied, or had revoked, a gaming license by a Governmental Entity or Gaming Authority.  Purchaser and each of its applicable representatives and its Affiliates are in good standing and are licensed, suitable and qualified under all applicable Gaming Laws in each of the jurisdictions in which Purchaser or any of its Affiliates owns or operates gaming facilities.  There are no facts, which if known to any Gaming Authority, would (a) be reasonably likely to result in the delay, denial, revocation, limitation or suspension of a gaming license currently held, or which may be sought pursuant to, or in connection with the transactions contemplated by, this Agreement, by Purchaser or any of its Affiliates or (b) be reasonably likely to result in a negative outcome in connection with any finding of suitability or similar qualification proceedings currently pending, or under any future suitability or similar qualification proceedings necessary for the consummation of this Agreement or any transaction contemplated hereby, including with respect to Purchaser or any of its Affiliates or any of their respective officers, directors, key employees or Persons performing management functions similar to an officer, partner or limited partner under any Gaming Laws.

 

6.10                           Compliance with Gaming Laws.

 

(a)                                  Neither Purchaser nor any of its Affiliates has received written notice of any material investigation or review by any Governmental Entity under any Gaming Law with respect to Purchaser or any of its Affiliates that is unresolved, and, to the knowledge of Purchaser, no such investigation or review is threatened, nor has any Governmental Entity indicated any intention to conduct the same.

 

(b)                                 To the knowledge of Purchaser, there are no facts, which if known to the Gaming Authorities, will or would reasonably be expected to result in the revocation, limitation or suspension of an existing material license, finding of suitability or similar qualification, registration, permit or approval of Purchaser or any of its Affiliates, or any of their respective officers, directors, key employees or Persons performing management functions similar to an officer, partner or limited partner under any Gaming Laws or a denial of an application for the any such Gaming Approval.  None of Purchaser, its Affiliates or any officer, director, key employee or Person performing any management functions similar to an officer or partner of Purchaser or its Affiliates, has suffered a suspension or revocation of any license held under any applicable Gaming Laws or a denial of an application for the same.

 

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6.11                           Purchased Assets “AS IS”; Purchaser’s Acknowledgment and Investigation.  Notwithstanding anything contained in this Agreement to the contrary, Purchaser acknowledges and agrees that the Company is not making any representations or warranties whatsoever, express or implied, beyond those expressly given by the Company in Article V (as modified by the Schedules thereto), and Purchaser acknowledges and agrees that, except for the representations and warranties contained therein, the Purchased Assets and the Casino Business will, should the Closing occur, be transferred on a “WHERE IS” and, as to condition, “AS IS” basis.  Purchaser agrees, warrants, and represents that, except as set forth in the representations and warranties of the Company contained in Article V of this Agreement, Purchaser has relied, and shall rely, solely upon Purchaser’s own investigation of all such matters, and that Purchaser assumes all risks with respect thereto.  EXCEPT AS SET FORTH IN THIS AGREEMENT, THE COMPANY MAKES NO EXPRESS WARRANTY, NO WARRANTY OF MERCHANTABILITY, NO WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, NOR ANY IMPLIED OR STATUTORY WARRANTY WHATSOEVER WITH RESPECT TO ANY REAL OR PERSONAL PROPERTY OR ANY FIXTURES OR THE PURCHASED ASSETS.  Any claims Purchaser may have for breach of representation or warranty shall be based solely on the representations and warranties of the Company set forth in Article V (as qualified by the Schedules thereto).  Purchaser further represents that neither the Company nor any of its Affiliates nor any other Person has made any representation or warranty, express or implied, as to the accuracy or completeness of any information regarding the Company, the Casino Business, the Purchased Assets, the Assumed Liabilities or the transactions contemplated by this Agreement not expressly set forth in this Agreement, and neither the Company nor any of its Affiliates or any other Person will have or be subject to any liability to Purchaser or any other Person resulting from the distribution to Purchaser or its representatives or Purchaser’s use of, any such information, including any confidential memoranda distributed on behalf of the Company relating to the Casino Business or other publications or data room information provided to Purchaser or its representatives, or any other document or information in any form provided to Purchaser or its representatives in connection with the sale of the Casino Business and the transactions contemplated hereby.  Purchaser represents that it is a sophisticated entity that was advised by knowledgeable counsel and other advisors and hereby acknowledges that has conducted its own independent investigation of the Casino Business, the Purchased Assets and the Assumed Liabilities.  In making its determination to proceed with the transactions contemplated by this Agreement, Purchaser has relied solely on the results of its own independent investigation and the express representations and warranties of the Company in this Agreement and the Schedules.  Purchaser has been furnished with and has had access to all such information concerning the Company and its respective assets, properties and liabilities as Purchaser considers relevant in connection with its determination to enter into this Agreement and to consummate the transactions contemplated hereby.  Without limiting the foregoing in any respect, Purchaser acknowledges that the Purchase Price has been negotiated based on Purchaser’s express agreement that there would be no contingencies (financial or otherwise) to Closing other than the conditions set forth in Article X.

 

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ARTICLE VII
  BANKRUPTCY COURT MATTERS

 

7.1                                 Actions of the Company.

 

(a)                                  The Company acknowledges that Purchaser and its affiliates have devoted and will devote substantial time and have incurred and will incur significant out-of-pocket expenses in connection with this Agreement and the transactions contemplated thereby.  To induce Purchaser to incur such time and expenses, the Company hereby agrees that from and after the date of signing of this Agreement by the Company and Purchaser and until the Closing Date, except as contemplated by this Agreement, the Company will not, and will not permit its Affiliates, directors, officers, employees, advisors or agents (A) initiate, solicit, negotiate or accept any inquiries, proposals or offers (whether initiated by them or otherwise)  with respect to (i) the acquisition of any shares of capital stock or any other voting securities or debt securities of the Company or any interests therein, (ii) the acquisition of all or a material portion of the assets and properties of the Company or interests therein, (iii) the merger, consolidation or combination of the Company, (iv) the financing or refinancing of the Company, (v) the liquidation, dissolution or reorganization of the Company or (vi) the acquisition, directly or indirectly, by the Company of capital stock or assets and properties of any other Person (any of the foregoing clauses (i) through (vi), a “Potential Transaction”), or (B) enter into any contract, agreement or arrangement with any Person, concerning or relating to a Potential Transaction.

 

(b)                                 The Company acknowledges that this Agreement is the culmination of an extensive process undertaken by the Company to identify and negotiate a transaction with a bidder who was prepared to pay the highest and/or best purchase price for the Purchased Assets while assuming or otherwise satisfying the Assumed Liabilities to maximize the value of those assets.

 

(c)                                  The Company shall use its reasonable best efforts to have the Bankruptcy Court enter the Sale Order.  Furthermore, the Company shall use its reasonable best efforts to obtain any other approvals or consents from the Bankruptcy Court that may be reasonably necessary to consummate the transactions contemplated by this Agreement.

 

(d)                                 Notwithstanding anything to the contrary in this Agreement, the Company’s Transaction Committee may discuss unsolicited inquiries, proposals and offers for Potential Transactions, and if necessary may apply to the Bankruptcy Court for authority to negotiate and present to the Bankruptcy Court such Potential Transactions, provided that in each case the Company’s Transaction Committee reasonably believes in good faith that such action (i) would result in a transaction more favorable to the Company’s stakeholders from a financial point of view and (ii) based on the advice of its legal advisors, is required in order to comply with its fiduciary duties under law.

 

7.2                                 Purchaser Actions.  Purchaser agrees that it will promptly take any and all such actions as are reasonably requested by the Company from time to time to assist in obtaining the Sale Order, including furnishing affidavits or other documents or information for filing with the Bankruptcy Court for the purposes, among others, of providing necessary assurances of

 

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performance by Purchaser under this Agreement and demonstrating that Purchaser is a “good faith” purchaser under Section 363(m) of the Bankruptcy Code.

 

7.3                                 Adequate Assurances.  With respect to each Assumed Agreement, Purchaser shall use commercially reasonably efforts to provide adequate assurance of the future performance of such Assumed Agreement by Purchaser.

 

7.4                                 Sale Order.  The Sale Order shall be acceptable to Purchaser in form and substance and, among other provisions required by Purchaser, shall:

 

(a)                                  approve this Agreement and the transactions contemplated hereby in all respects;

 

(b)                                 find that, as of the Closing Date, the transactions contemplated by this Agreement effect a legal, valid, enforceable and effective sale and transfer of the Purchased Assets required to be sold to Purchaser on the Closing Date and shall vest Purchaser with valid title to the Purchased Assets, and valid, record, marketable and insurable title to the Land free and clear of all Encumbrances except (a) as set forth on Schedule 5.5, (b) for the Assumed Liabilities, and (c) for Permitted Encumbrances;

 

(c)                                  find that the total consideration provided by Purchaser for the Purchased Assets is the highest and best offer received by the Company, is a fair and reasonable price for the Purchased Assets, and the Purchase Price constitutes reasonably equivalent value, fair consideration and fair value under applicable state and federal law;

 

(d)                                 find that the transactions contemplated by this Agreement are in the best interests of the Company and its estate, are undertaken by Purchaser and the Company at arm’s length and in good faith, such parties are entitled to the protections of Section 363(m) of the Bankruptcy Code, satisfy the provisions of Section 363(f) of the Bankruptcy Code, and that Purchaser is not an “insider” of the Company, as that term is defined in section 101(31) of the Bankruptcy Code, and is a good faith purchaser of the Purchased Assets pursuant to Section 363(m) of the Bankruptcy Code;

 

(e)                                  approve any other agreement to the extent provided by this Agreement;

 

(f)                                    find that the Company gave good and sufficient notice of the assumption and assignment of the Assumed Agreements and all Assumed Agreements shall be assumed by the Company and assigned to Purchaser pursuant to Section 365 of the Bankruptcy Code;

 

(g)                                 provide that transactions contemplated by this Agreement do not constitute a fraudulent transfer under the Bankruptcy Code or any similar law of the United States, and state, territory possession thereof, or the District of Columbia, and that the Purchaser will not have any successor or transferee liability for liabilities of the Company (whether under federal or state law or otherwise) as a result of the sale of the Purchased Assets;

 

(h)                                 authorize and direct the Company to consummate the transactions contemplated hereby;

 

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(i)                                     enjoin any person or entity with notice thereof from interfering with Purchaser’s use and enjoyment of the Purchased Assets; and

 

(j)                                     provide that any and all valid liens and other interests in the Purchased Assets other than (i) as set forth on Schedule 5.5, (ii)  the Assumed Liabilities, and (iii) for Permitted Encumbrances, shall attach to the proceeds of the sale of the Purchased Assets to Purchaser.

 

7.5                                 Support of Sale Order.  The Company and Purchaser shall not, without the prior written consent of the other party, file, join in, or otherwise support in any manner whatsoever any motion or other pleading relating to the sale of the Purchased Assets hereunder, other than in support of this Agreement.  In the event the entry of the Sale Order shall be appealed, the Company and Purchaser shall use their respective reasonable best efforts to defend against such appeal.

 

7.6                                 Assignment of Contracts.

 

(a)                                  The Company and Purchaser shall use commercially reasonable efforts to have included in the Sale Order an authorization for the Company to assume and assign or otherwise transfer to Purchaser all Assumed Agreements.  Without limiting the foregoing, the Company shall use commercially reasonable efforts to ensure that the Sale Order provides that:  (i) all right, title, and interest of the Company under each of the applicable Assumed Agreements shall, upon Closing, be transferred and assigned to and fully and irrevocably vest in Purchaser; (ii) each Assumed Agreement is in full force and effect; (iii) the Company may assume each Assumed Agreement and may assume each Assumed Agreement that is an executory contract or an unexpired lease pursuant to Section 365 of the Bankruptcy Code; (iv) the Company may assign each Assumed Agreement to Purchaser, pursuant to Section 365 of the Bankruptcy Code or otherwise, free and clear of all Encumbrances (other than Permitted Encumbrances) and any provisions in any such Assumed Agreement that purport to prohibit or condition the assignment of such contract or lease constitute unenforceable anti-assignment provisions that are void and of no force or effect; (v) all other requirements and conditions of Section 365 of the Bankruptcy Code for the assumption by the Company and assignment to Purchaser of each Assumed Agreement that is an executory contract or an unexpired lease have been satisfied; (vi) upon Closing, in accordance with Section 365 of the Bankruptcy Code with respect to Assumed Agreements that are executory contracts or unexpired leases, Purchaser shall be fully and irrevocably vested in all right, title, and interest in each Assumed Agreement and that following the Closing, each such contract or lease shall remain in full force and effect; (vii) the assignment of each Assumed Agreement to Purchaser is in good faith under Sections 363(b) and 363(m) of the Bankruptcy Code; and (viii) the Company gave due and proper notice of such assumption and assignment to each counterparty to an Assumed Agreement.

 

(b)                                 At Closing, pursuant to Section 363 of the Bankruptcy Code (and Section 365 with respect to Assumed Agreements that are executory contracts or unexpired leases), the Company shall assume, assign and sell to Purchaser and Purchaser shall assume and purchase from the Company, the Assumed Agreements.

 

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ARTICLE VIII

PRE-CLOSING COVENANTS AND AGREEMENTS

 

8.1                                 Access to Information.  The Company agrees that, prior to the Closing Date, Purchaser and its officers, employees and representatives (including its legal advisors and accountants), shall have reasonable access to the properties, businesses and operations of the Casino Business, the Purchased Assets and the Assumed Liabilities.  Access to the properties shall be conducted during regular business hours, upon reasonable advance notice, under reasonable circumstances and subject to the supervision of the Company (including a Company escort, if the Company so determines).  The Company shall cause the officers, employees, consultants, agents, accountants, attorneys and other representatives of the Company to cooperate with Purchaser and Purchaser’s representatives, and Purchaser and its representatives shall cooperate with the Company and its representatives and shall not disrupt the Casino Business.  Notwithstanding the foregoing, Purchaser will not contact any employee, customer or supplier of the Company or the Casino Business with respect to this Agreement without the prior written consent of the Company.  Purchaser agrees to repair at its sole cost any damage to the Real Property or any of the Purchased Assets or the Excluded Assets caused by Purchaser’s or its Affiliates’ examination.  The Company shall consult with Purchaser reasonably in advance of the filing of, and give Purchaser reasonable opportunity to comment on, all pleadings, motions, notices, statements, schedules, applications, reports and other papers filed (i) by the Company in the Bankruptcy Case and (ii) in any other judicial or administrative proceeding by or relating to the Company as Purchaser may reasonably request.

 

8.2                                 Conduct of the Business Pending the Closing.

 

(a)                                  Prior to the Closing, subject to any obligations as debtor and debtor in possession under the Bankruptcy Code (including the prosecution of the Bankruptcy Case) and except (i) as required by applicable Law, (ii) as otherwise expressly contemplated by this Agreement, or (iii)  with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall:

 

(i)                                     conduct the Casino Business only in the Ordinary Course of Business;

 

(ii)                                  use its commercially reasonable efforts to (A) preserve its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve the present relationships with Persons having business dealings with the Company (including without limitation customers and suppliers);

 

(iii)                               maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the assets and properties of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;

 

(iv)                              (A) maintain the books, accounts and records of the Company and its in the Ordinary Course of Business, (B) continue to collect accounts receivable and

 

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pay accounts payable utilizing normal procedures and without discounting or accelerating payment of such accounts, and (C) comply with all contractual and other obligations applicable to the operation of the Company;

 

(v)                                 comply in all material respects with applicable Laws, including, without limitation, Gaming Laws; and

 

(vi)                              not take any action which would materially and adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.

 

(b)                                 Except as otherwise expressly contemplated by this Agreement or with the prior written consent of Purchaser, the Company shall not:

 

(i)                                     (A) materially increase the annual level of compensation of any employee of the Company, (B) increase the annual level of compensation payable or to become payable by the Company to any of its executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company is a party or involving a director, officer or employee of the Company in his or her capacity as a director, officer or employee of the Company;

 

(ii)                                  make any loan or advance to any Person or incur or assume any Indebtedness, other than casino credit lines to customers of the Casino Business in the Ordinary Course of Business;

 

(iii)                               make or rescind any election relating to Taxes, settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes, or except as may be required by applicable Law or GAAP, make any material change to any of its methods of accounting or methods of reporting income or deductions for Tax or accounting practice or policy from those employed in the preparation of its most recent Tax Returns;

 

(iv)                              subject to any lien or otherwise encumber or permit, allow or suffer to be encumbered, any material portion of the properties or assets (whether tangible or intangible) of the Company;

 

(v)                                 enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities of any other Person;

 

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(vi)                              cancel or compromise any material debt or claim or waive or release any material right of the Company;

 

(vii)                           enter into, modify or terminate any labor or collective bargaining agreement or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization;

 

(viii)                        enter into any transaction or enter into, modify or renew any Contract which by reason of its size or otherwise is not in the Ordinary Course of Business;

 

(ix)                                enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Casino Business, or the ability of Purchaser, to compete with or conduct any business or line of business in any geographic area;

 

(x)                                   terminate, amend, restate, supplement or waive any rights under any (A) Material Contract, Real Property lease, Intellectual Property licenses or (B) Permit;

 

(xi)                                amend the organizational documents of the Company; or

 

(xii)                             agree to do anything prohibited by this Section 8.2 or anything which would make any of the representations and warranties of the Company in this Agreement untrue or incorrect in any material respect.

 

8.3                                 Certain Financing Matters.  (a)  Purchaser will use its commercially reasonable efforts to take, or cause to be taken, all actions necessary or advisable to satisfy on a timely basis all conditions applicable to the Financing that are within its control and, upon satisfaction of such conditions, to obtain the Financing, including using its commercially reasonable efforts to (x) satisfy on a timely basis all terms, covenants and conditions set forth in the Financing Commitments; (y) enter into definitive agreements with respect thereto on the terms and conditions contemplated by the Financing Commitments; and (z) consummate the Financing on the terms and conditions set forth in the Financing Commitments at or prior to Closing.  Purchaser shall keep the Company informed on a reasonably current basis of the status of its efforts to arrange the Financing.  If any Financing Commitments shall be terminated or cease to be available for any reason, or if any notice of termination shall be given thereunder, Purchaser will use its commercially reasonable efforts to secure alternative financing upon terms that are not less favorable to Purchaser than those set forth in the Financing Commitments as in effect on the date of this Agreement (any such alternative financing arrangement, the “Alternative Financing”). References to the Financing in this Section 8.3 shall include any Alternative Financing (and the new financing commitment related thereto) entered into in accordance with this Section 8.3.

 

(b)  In order to assist with obtaining the Financing, the Company shall provide such assistance and cooperation as Purchaser and its Affiliates may reasonably request, including, but not limited to, commercially reasonable cooperation in the preparation of any offering memorandum or similar document, cooperating with initial purchasers, lenders, placements

 

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agents or arrangers, making senior management of the Company reasonably available for customary “roadshow” and lender presentations and cooperation with prospective lenders in performing their due diligence, entering into customary agreements with underwriters, initial purchasers or placement agents, performing environmental assessments, and entering into pledge and security documents, other definitive financing documents or other requested certificates or documents, including a customary certificate of the chief financial officer of the Company with respect to solvency matters, comfort letters of accountants, legal opinions and real estate title documentation.

 

(c)  The debt financing sources under the Financing Commitments (and their respective Affiliates and their and their respective Affiliates’ officers, directors, employees, shareholders, representatives and agents) (collectively, the “Debt Financing Sources”) shall not have any Liability to the Company under this Agreement or any transaction contemplated hereby.

 

8.4                                 Regulatory Approvals.

 

(a)                                  Purchaser and the Company shall cooperate with each other and use commercially reasonable efforts to (and, with respect to the Gaming Laws shall use commercially reasonable efforts to cause their respective directors and officers to) promptly prepare and file all necessary documentation, to effect all applications, notices, petitions and filings, to obtain as promptly as practicable all Gaming Approvals, and to comply (and, with respect to the Gaming Laws, to cause their respective directors and officers to comply) with the terms and conditions of all such Gaming Approvals.  Purchaser and its Affiliates, directors and officers shall (i) promptly following the commencement of the Bankruptcy Case, file all required initial applications and documents in connection with obtaining the Gaming Approvals under the Gaming Laws, (ii) as soon as reasonably practicable after the date hereof file all required initial applications and documents in connection with all Governmental Approvals other than those required under clause (i), and (iii) diligently and promptly respond thereafter to additional requests and comments therewith and pursue all such Governmental Approvals as promptly as possible.  The Parties acknowledge that this Agreement and the transactions contemplated hereby are subject to the review and approval of the Gaming Authorities.  Each of the Company and Purchaser shall have the right to reasonably consult with the other on, in each case subject to applicable Laws relating to the exchange of information (including Gaming Laws), all the information relating to the other Person and any of its Affiliates that appears in any filing made with, or written materials submitted to, any third Person or Gaming Authority in connection with the transactions contemplated by this Agreement.  Without limiting the foregoing, each of the Company and Purchaser (the “Notifying Party”) shall notify the other Party promptly of the receipt of comments or requests from any Gaming Authority relating to the Gaming Approvals and shall supply the other Party with copies of all correspondence between the Notifying Party or any of its representatives and the Gaming Authority with respect to the Gaming Approvals; provided, however, that neither the Company nor Purchaser shall be required to supply the other Party with copies of communications relating to the personal applications of individual applicants (except for evidence of filing) or with any documents that are the subject of a confidentiality agreement barring the same; provided further that each of the Company and Purchaser shall promptly notify the other Party upon receiving any communication from the Gaming Authority that causes such Party to reasonably believe that there is a reasonable

 

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likelihood that such Gaming Approval from such Gaming Authority will not be obtained or that the receipt of any such Gaming Approval will be materially delayed.

 

(b)                                 Prior to Closing, each of the Company and Purchaser shall use its commercially reasonable efforts to (i) obtain all other Permits of all Governmental Entities and all other Persons required to be obtained by Purchaser to effect the transactions contemplated by this Agreement and (ii) take, or cause to be taken, all action, and to do, or cause to be done, all things necessary or proper, consistent with applicable Law, to consummate and make effective in an expeditious manner the transactions contemplated hereby.

 

(c)                                  If necessary, Purchaser and the Company shall (i) make or cause to be made all filings required of each of them or any of their respective subsidiaries or Affiliates under the HSR Act or other Antitrust Laws with respect to the transactions contemplated hereby as promptly as practicable, (ii) comply at the earliest practicable date with any request under the HSR Act or other Antitrust Laws for additional information, documents or other materials received by each of them from the Federal Trade Commission (the “FTC”), the Antitrust Division of the United States Department of Justice (the “Antitrust Division”), in respect of such filings or such transactions, (iii) seek early termination of filings under the HSR Act, and (iv) cooperate with each other in connection with any such filing and in connection with resolving any investigation or other inquiry of any of the FTC, the Antitrust Division, or other Governmental Entity under any Antitrust Laws with respect to any such filing or any such transaction.  Purchaser and the Company shall each be responsible for paying one-half of the filing fees required to be paid by under the HSR Act and other Antitrust Laws in connection with such filings.  Each such Party shall use commercially reasonable efforts to furnish to each other all information required for any application or other filing to be made pursuant to any applicable Law in connection with the transactions contemplated by this Agreement.  Each such Party shall promptly inform the other Parties of any material oral communication with any Governmental Entity regarding any such filings or any such transactions.  No Party hereto shall independently participate in any formal meeting with any Governmental Entity in respect of any such filings, investigation or other inquiry without giving the other Party prior notice of the meeting and, to the extent permitted by such Governmental Entity, the opportunity to attend and/or participate.  Subject to applicable Law, the Parties will consult and cooperate with one another in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any Party relating to proceedings under the HSR Act or other Antitrust Laws.  The Company and Purchaser may, as each deems advisable and necessary, reasonably designate any competitively sensitive material provided to the other under this Section 8.4 as “outside counsel only.”  Such materials and the information contained therein shall be given only to the outside legal counsel of the recipient and will not be disclosed by such outside counsel to employees, officers or directors of the recipient, unless express written permission is obtained in advance from the source of the materials (the Company or Purchaser, as the case may be).

 

(d)                                 Each of Purchaser and the Company shall use its commercially reasonable efforts to resolve such objections, if any, as may be asserted by any Governmental Entity with respect to the transactions contemplated by this Agreement under the HSR Act, the Sherman Act, as amended, the Clayton Act, as amended, the Federal Trade Commission Act, as amended, and any other United States federal or state or foreign statutes, rules, regulations, orders, decrees,

 

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administrative or judicial doctrines or other laws that are designed to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade (collectively, the “Antitrust Laws”).  In connection therewith, if any Legal Proceeding is instituted (or threatened in writing to be instituted) challenging that any transaction contemplated by this Agreement is in violation of any Antitrust Law, each of Purchaser and the Company shall cooperate and use its commercially reasonable efforts to contest and resist any such Legal Proceeding, and to have vacated, lifted, reversed or overturned any decree, judgment, injunction or other order whether temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts consummation of the transactions contemplated by this Agreement, including by pursuing all reasonably available avenues of administrative and judicial appeal and all reasonably available legislative action, unless either Purchaser or the Company reasonably decides that litigation is not in its best interests.  Each of Purchaser and the Company shall use its commercially reasonable efforts to take such action as may be required to cause the expiration of the notice periods under the HSR Act or other Antitrust Laws with respect to such transactions as promptly as possible after the execution of this Agreement.  Notwithstanding any other provision herein, in no event will Purchaser or any of its Affiliates be required hereunder or otherwise (i) to agree to any hold-separate, divestiture or other order, decree or restriction on the Casino Business or any other business of Purchaser or its Affiliates, the conduct thereof or future transactions or (ii) to pay any amount or agree to any action to obtain any consent or approval required or contemplated hereby.

 

8.5                                 Further Assurances.  Each of the Company and Purchaser shall use its commercially reasonable efforts to (a) take all actions necessary or appropriate to consummate the transactions contemplated by this Agreement and (b) cause the fulfillment at the earliest practicable date of all of the conditions to their respective obligations to consummate the transactions contemplated by this Agreement; and, in connection with the foregoing, respond to inquiries from the other Party regarding the status of such actions or conditions.

 

8.6                                 Confidentiality.  Purchaser acknowledges that the Confidential Information (as defined in the Confidentiality Agreement) provided to it and its Agents (as defined in the Confidentiality Agreement) in connection with this Agreement (including under Section 8.1) and the contemplation and consummation of the transactions contemplated hereby, is subject to the terms of the confidentiality agreement previously dated as of June 25, 2010, entered into between Fertitta Gaming LLC and the Company (the “Confidentiality Agreement”).  Effective upon, the Closing, the Confidentiality Agreement shall terminate.

 

8.7                                 Preservation of Records.  For a period ending on the later of (a) the closing of the Bankruptcy Case and (b) seven (7) years after the Closing Date (or such longer period as may be required by any Governmental Entity or ongoing claim), to the extent allowed by applicable Law, Purchaser shall allow the Company (including, for clarity, any trustee for the estate of the Company, any trust plan administrator or other entity established under a chapter 11 plan of the Company or any other successor of the Company) and any of its directors, officers, employees, counsel, representatives, accountants and auditors, at the Company’s sole cost and expense, reasonable access during normal business hours, and upon reasonable advance notice, to all employees and files of Purchaser and any books and records and other materials included in the Purchased Assets relating to periods prior to the Closing Date in connection with the general business purposes of the Casino Business, whether or not relating to or arising out of this

 

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Agreement or the transactions contemplated hereby, including the preparation of Tax Returns, amended Tax Returns or claims for refund (and any materials necessary for the preparation of any of the foregoing), financial statements for periods ending on or prior to the Closing Date, the management and handling of any audit, investigation, litigation or other proceeding), and complying with the rules and regulations of the IRS, the Commission or any other Governmental Entity, provided that commencing one (1) year following the Closing Date, Purchaser may dispose of books and records and other materials that are the subject of this Section 8.7 after it gives the Company a reasonable opportunity, at the Company’s expense, to segregate and remove such books and records and other materials as the Company may select.  Purchaser hereby agrees that it shall use its commercially reasonable efforts to make Transferred Employees available to participate in any claim, litigation or investigation brought by any Governmental Entity or any other Person against the Company or any of its Affiliates or any former officer, director, or employee of the Company to the extent that such participation has been requested by the Company or any of its Affiliates or any Governmental Entity.

 

8.8                                 Publicity.  Except as required by Law or any filings by the Company or its Affiliates with the Bankruptcy Court or the Commission, neither the Company nor Purchaser shall issue any press release or public announcement concerning this Agreement or the transactions contemplated hereby without obtaining the prior written approval of the other Party hereto, which approval will not be unreasonably withheld or delayed, provided that the Party intending to make any such release it deems required by Law shall use its commercially reasonable efforts consistent with such applicable Law to consult with the other Party with respect to the text thereof.

 

8.9                                 Supplementation and Amendment of Schedules.  From time to time prior to Closing, the Company shall have the obligation to supplement or amend its Schedules with respect to any matter hereafter arising or discovered after the delivery of the Schedules pursuant to this Agreement that, if existing or known at, or occurring prior to, the date hereof, would have been required to be set forth or described in such Schedules.  Any such supplement or amendment shall have no effect on the representations and warranties, covenants or agreements contained in this Agreement for the purposes of determining satisfaction of any condition herein or shall in any way limit Purchaser’s rights under this Agreement.

 

8.10                           Payment of Restructuring Fee.  No later than the fifth (5th) Business Day following the date on which not less than (i) a majority of the lenders under the First Lien Credit Agreement and (ii) two-thirds of the First Lien Credit Agreement Claims, each as determined pursuant to the First Lien Credit Agreement, have entered into that certain First Lien Lender Plan Support Agreement, the Company shall deliver an amount equal to $5,000,000 by wire transfer of immediately available funds to an account designated by the First Lien Credit Agreement Agent in accordance with the terms of the First Lien Lender Plan Support Agreement.

 

8.11                           Payment of Ticking Fee.

 

(a)  If the Closing has not occurred by April 30, 2011, then as of May 1, 2011 an amount equal to $750,000 (the “May Ticking Fee”) shall be added to the Purchase Price, and (b) if the Closing has not occurred by May 31, 2011, then as of June 1, 2011 an amount equal to $1,000,000 (the “June Ticking Fee”) shall be added to the Purchase Price.

 

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8.12                           Payment of Gaming Delay Extension Fee.  If the Closing has not occurred by June 30, 2011 and Purchaser elects to extend the Termination Date pursuant to Section 4.5(b), then as of July 1, 2011, an amount equal to the product of (a) the number of days included in the extension period elected by the Purchaser times (b) $33,333.33 shall be added to the Purchase Price (the “Gaming Delay Extension Fee”).

 

ARTICLE IX

ADDITIONAL AGREEMENTS

 

9.1                                 Employees.

 

(a)                                  Effective as of the Closing Date, the Company shall terminate all the Employees, and Purchaser shall offer to all or substantially all of such Employees at will full-time employment (or at will part-time employment if an Employee was employed on a part-time basis as of the Closing Date) on the terms set forth in Section 9.1(b) to be effective immediately, without interruption, as of the Closing.  Such Employees who accept Purchaser’s offer of employment shall be referred to as the “Transferred Employees.”  To facilitate Purchaser’s obligations under this Section 9.1(a), upon request and to the extent permitted by Law, the Company shall provide Purchaser within a reasonable period prior to the Closing a true and correct list of all Employees, including with respect to any inactive Employee, the reason for such inactive status and, if applicable, the anticipated date of return to active employment.

 

(b)                                 To the extent permitted by Law, Purchaser shall offer the at will employment contemplated in Section 9.1(a) to each Transferred Employee on terms such that the base wages or base salary and other compensation (including bonus and incentive opportunity) offered to each such Transferred Employee are substantially equivalent in the aggregate to the base wage, or base salary and other compensation provided to such Transferred Employee as of the Closing Date and employee benefits that are, in the aggregate, substantially comparable to the employee benefits provided to each such Transferred Employee immediately prior to the Closing Date.  The parties hereto agree that nothing in this Agreement shall limit Purchaser’s ability after the Closing Date to modify or terminate, as applicable (i) the employment of any Transferred Employee, (ii) any benefit policy, plan or program offered to or covering any Transferred Employee or (iii) the compensation of any Transferred Employee.

 

(c)                                  With respect to any employee benefit plan, program or arrangement maintained, sponsored or administered by Purchaser on or after the Closing Date under which the Transferred Employees may be eligible to participate, for all purposes of determining eligibility to participate and vesting, and, with respect only to any severance, vacation or sick time plan, program or arrangement for purposes of benefit accrual, a Transferred Employee’s service with the Company or an Affiliate of the Company shall, to the extent reasonably practicable, be treated as service with Purchaser to the same extent such service was recognized under a similar Company Benefit Plan; provided, however, that such service need not be recognized to the extent that such recognition would result in any duplication of benefits.

 

(d)                                 Effective as of the Closing Date, the Company or its Affiliates shall take all actions reasonably necessary to terminate the participation of each Transferred Employee in any Company Benefit Plan.  Purchaser shall use its commercially reasonable efforts to waive, or

 

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cause to be waived any pre-existing condition limitation under any “employee welfare benefit plans” (within the meaning of Section 3(1) of ERISA (including medical, life insurance and other such employee welfare benefit plans)) maintained by Purchaser or any of its Affiliates in which Transferred Employees (and their eligible dependents) will be eligible to participate from and after the Closing, except to the extent such pre-existing condition limitation or exclusion would have been applicable under any comparable Company Benefit Plan immediately prior to the Closing.  Purchaser shall use its commercially reasonable efforts to recognize the dollar amount of all expenses incurred by each Transferred Employee (and his or her eligible dependents) during the calendar year in which the Closing occurs for purposes of satisfying such year’s deductible and co-payment limitations or exclusions under any relevant welfare benefit plans in which they will be eligible to participate from and after the Closing.

 

(e)                                  Purchaser acknowledges and agrees that any employment loss within the meaning of the WARN Act suffered by any Employee immediately upon or within ninety (90) days after the Closing Date shall have been caused by Purchaser’s decision not to continue the employment of such Employee, and not by the sale of the Purchased Assets.  Purchaser shall be responsible for and shall indemnify and hold harmless the Company and its Affiliates against any and all claims asserted under the WARN Act because of a “plant closing” or “mass layoff,” as defined therein, due in whole or in part to the actions or omissions of Purchaser.  For purposes of this Agreement, the Closing Date is and shall be the same as the “effective date” of the sale within the meaning of the WARN Act.  The Company shall give all notices that may be required under and otherwise required to comply with all provisions of the WARN Act for all terminations of the Employees that occur prior to Closing based on any termination decisions made by the Company (other than the terminations required by Section 9.1(a)).  Purchaser shall give all notices required under and otherwise required to comply with all provisions of the WARN Act for all involuntary terminations of the Employees that occur on or after Closing.  The Company agrees to cooperate with Purchaser so that Purchaser may comply with the WARN Act, including providing Purchaser with information regarding the Employees’ status as full-time or part- time as defined by the WARN Act, providing Purchaser with information regarding involuntary Employee terminations during the ninety (90) days prior to Closing, and giving Purchaser access to the Employees to disseminate any notices pursuant to the WARN Act in the event Purchaser determines in its sole discretion that such notice must be given to the Employees prior to Closing due to terminations it intends to execute during the ninety (90) days immediately following Closing.  If Purchaser determines in its sole discretion that notice must be given to the Employees prior to Closing pursuant to the WARN Act, the providing of such notice shall not be deemed to violate any of the confidentiality or publicity provisions contained in this Agreement.

 

(f)                                    The provisions of this Section 9.1 are for the sole benefit of the Parties and nothing herein, expressed or implied, is intended or shall be construed to confer upon or give to any Person (including, for the avoidance of doubt, any Employees), other than the Parties and their respective permitted heirs, executors, administrators, successors and assigns, any legal or equitable or other rights or remedies (with respect to the matters provided for in this Section 9.1) under or by reason of any provision of this Agreement.

 

(g)                                 Purchaser or its Affiliates, shall be responsible for and shall reimburse the Company for all claims that are unpaid as of the Closing Date under any Company Benefit Plan that is a self-insured “employee welfare benefit plan,” within the meaning of Section 3(1) of

 

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ERISA associated with any Transferred Employee (including any dependents thereof).  For purposes of this paragraph, a claim is deemed incurred when the services that are subject to such claim are performed or the materials are supplied, regardless of when such claim is submitted for reimbursement.  Purchaser and the “buying group” (as defined in Treasury Regulation Section 54.4980B-9, Q&A-2(c)) of which it is a part shall be solely responsible for providing COBRA continuation coverage pursuant to (i) Section 4980B(f) of the Code, Part 6 of Subtitle B of Title I of ERISA and similar state Law to all Employees and those individuals who are M&A qualified beneficiaries (as defined in Treasury Regulation Section 54.4980B-9, Q&A-4(b)) with respect to the transactions contemplated by this Agreement (collectively, the “M&A Qualified Beneficiaries”), and (ii) Title III of Division B of the American Recovery and Reinvestment Act of 2009, as amended, and all guidance promulgated thereunder, to the extent applicable with respect to the M&A Qualified Beneficiaries.

 

(h)                                 Subject to the consummation of the transactions contemplated by this Agreement, Purchaser shall take commercially reasonable efforts to permit or cause an Affiliate of Purchaser to permit each Transferred Employee to enroll as soon as administratively practicable after the Closing Date and become a participant in any Purchaser or its Affiliate-sponsored 401(k) plan or other similar retirement plan for which such employee is eligible (a “Purchaser 401(k) Plan”) (disregarding any service requirements or waiting periods to the extent service requirements or waiting periods were satisfied by the Transferred Employee with respect to a similar Company Benefit Plan prior to Closing).  Purchaser shall permit or cause an Affiliate of Purchaser to permit the Transferred Employees who are participants in the Company’s or its Affiliate’s 401(k) plan to roll over any distributions from such plan (including a rollover of outstanding participant loans) into a Purchaser 401(k) Plan.

 

(i)                                     Pursuant to the “Standard Procedure for Predecessors and Successors” provided in Section 4 of Revenue Procedure 2004-53, 2004-2 C.B. 320, (i) Purchaser and the Company shall report on a predecessor/successor basis as set forth therein, (ii) the Company will file (or cause to be filed) a Form W-2 for each Transferred Employee with respect to wages paid prior to the Closing Date, and (iii) Purchaser will file (or cause to be filed) a Form W-2 for each Transferred Employee with respect wages paid after the Closing Date.

 

9.2                                 Reservations; Chips; Customer Information.

 

(a)                                  Reservations.  Following Closing, Purchaser shall honor the terms and rates of all pre-Closing reservations (in accordance with their terms) with respect to the Casino Business by customers, including advance reservation cash deposits, for services confirmed by the Company for any time subsequent to the Closing, provided, however, that the terms of such reservations shall be consistent with the Ordinary Course of Business of the Casino Business.  Prior to the Closing Date, the Company may continue to accept reservations for periods after the Closing in the Ordinary Course of Business in operating the Casino Business.  Purchaser recognizes that such reservations may include discounts or other benefits, including benefits extended under the Company’s or its Affiliates’ player loyalty program or any other frequent player or casino awards programs, group discounts, or other discounts or requirements that food, beverage or other benefits be delivered by the Company to the guest or guests, as the case may be, holding such reservations.  Purchaser shall honor all banquet facility and service agreements that have been granted to groups, persons or other customers for periods after the Closing Date at

 

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the rates and on the terms provided in such agreements, provided, however, that the terms of such agreements shall be consistent with the Ordinary Course of Business of the Casino Business.  Purchaser agrees that the Company cannot and does not make any representation or warranty that any party holding a reservation or agreement for facilities or services shall utilize such reservation or honor such agreement.  Purchaser, by the execution hereof, solely assumes the risk of non-utilization of reservations and non-performance of such agreements from and after the Closing.

 

(b)           Destruction of Chips.  From and after (i) the date that is one hundred eighty (180) days after the Closing Date, Purchaser shall cease to issue or use and shall not reissue or reuse any of the Company’s gaming chips, tokens or plaquemines and (ii) the Closing Date, Purchaser shall be solely responsible and liable for compliance with all applicable Gaming Laws or any applicable Order with respect to any of the Company’s gaming chips, tokens or plaquemines.  During the one hundred eighty (180) period described in clause (i) of the immediately preceding sentence, Purchaser shall (a) redeem all of the Company’s gaming chips, tokens and plaquemines pursuant to a plan of redemption of discontinued chips, tokens or plaquemines approved by the Gaming Authorities, and (b) destroy all of the Company’s gaming chips, tokens and plaquemines pursuant to a plan of destruction approved by the Gaming Authorities.

 

(c)           Customer Data.  Purchaser acknowledges and agrees that (i) customers whose information is contained in the Customer Database may, from time to time, also be customers of, or otherwise play at, casino properties other than the Casino Business (including, without limitation, casino properties presently owned or operated by SCI or its Affiliates) (such customers, the “Common Customers”), (ii) the Customer Database contains only records of the Common Customers’ play at the Casino Business and (iii) except with respect to the obligations of the Company hereunder in connection with the Customer Database, neither SCI nor any Affiliate thereof is required pursuant to the terms of this Agreement or any Ancillary Agreement to furnish to Purchaser any information which SCI and its Affiliates may have with respect to the activity of the Common Customers at any casino property presently owned or operated by SCI or any of its Affiliates.  Nothing contained in this Agreement, express or implied, shall prohibit or in any way limit any third party (including, without limitation, SCI, any of its Affiliates or any acquirers of any of the casino properties presently owned by any of the foregoing) which holds information concerning any Common Customer in a database of its own from marketing to such Common Customer for any purpose, including, without limitation, in order to induce any such Common Customer to patronize such third party’s casino properties.

 

9.3           Certain Transactions.  Prior to the Closing, neither Purchaser nor its Affiliates shall take, or agree to commit to take, any action that (or fail to take, or agree to fail to take, any action, which failure to take) would or is reasonably likely to delay the receipt of, or to adversely impact the ability of Purchaser to obtain, any Governmental Approval necessary for the consummation of the transactions contemplated by this Agreement or necessary to permit Purchaser to acquire the Purchased Assets and operate the Casino Business, in each case, after the Closing in substantially the same manner as owned and operated by the Company prior to the Closing.  Without limiting the foregoing:

 

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(a)           Neither Purchaser nor any of its Affiliates shall withdraw, rescind, revoke or otherwise terminate or cancel any applications, filings or other submissions made in connection with obtaining any Governmental Approvals (or cause any of the foregoing to occur); and

 

(b)           if (i) any Governmental Entity has issued an Order or taken any other action denying Purchaser any necessary Governmental Approvals or determining or indicating that such Governmental Entity will not issue to Purchaser all necessary Governmental Approvals, or (ii) a court of competent jurisdiction or other Governmental Entity shall have issued an Order or taken any other action having the effect of permanently restraining, enjoining or otherwise prohibiting the Closing and the transactions contemplated hereby, Purchaser, and its Affiliates shall use their respective commercially reasonable efforts to have vacated, lifted, reversed or overturned any such order, decree, ruling or action and to have issued such Governmental Approvals (including exhausting all available remedies, challenges and appeals).

 

9.4           Insurance Policies.  The Company’s fire and casualty insurance and other insurance policies shall be cancelled by the Company or its applicable Affiliate as of the Closing Date, and any refunded premiums shall be retained by the Company.  Purchaser shall be solely responsible for acquiring and placing its casualty insurance, business interruption insurance, liability insurance and other insurance policies for periods after the Closing.

 

9.5           No Control.  Except as permitted by the terms of this Agreement, prior to the Closing, Purchaser shall not directly or indirectly control, supervise, direct or interfere with, or attempt to control, supervise, direct or interfere with, the Casino Business or the Employees.  Until the Closing, the operations and affairs of the Casino Business and the Purchased Assets are under the Company’s complete control, except as otherwise provided in this Agreement, including as provided in Section 8.2.

 

9.6           Employee Solicitation.

 

(a)           Beginning on the Closing Date and ending on the date that is the first anniversary of the Closing Date, neither the Company nor any of its Affiliates shall, without Purchaser’s written consent, solicit, entice, or encourage any Transferred Employee or any other employee employed by Purchaser to leave such person’s employment with Purchaser; provided, however, that the foregoing shall not apply to (i) a general solicitation of the public for employment so long as such general solicitation is not specifically targeted to employees, officers or directors of Purchaser or (ii) to individuals who initiate contact with the Company or any of the Company’s Affiliates regarding such employment without any encouragement or solicitation by the Company or any of its Affiliates.

 

(b)           Beginning on the date of this Agreement and ending on the date that is one year following the earlier of the termination of this Agreement and the Closing, neither Purchaser nor any of its Affiliates shall, directly or indirectly, without the written consent of the Company, as applicable, solicit, entice, or encourage any Employee that is not a Transferred Employee or any other person who shall have been an employee of the Company (or any other individual devoting the majority of his or her working time to service at or with the Company who is not an employee thereof) or its Affiliates (other than with respect to the Transferred

 

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Employees) during such time to leave such person’s employment with his or her employer, including, without limitation, the Company or its Affiliates (other than with respect to the Transferred Employees); provided, however, that the foregoing shall not apply to (i) a general solicitation of the public for employment so long as such general solicitation is not specifically targeted to employees, officers or directors of the Company or any of its Affiliates, as the case may be, or (ii) to individuals who initiate contact with Purchaser or any of its Affiliates regarding such employment without any encouragement or solicitation by Purchaser or any of its Affiliates.

 

ARTICLE X
  CONDITIONS TO CLOSING

 

10.1         Conditions Precedent to Obligations of Purchaser.  The obligation of Purchaser to consummate the transactions contemplated by this Agreement is subject to the satisfaction, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived by Purchaser in writing in whole or in part to the extent permitted by applicable Law):

 

(a)           each of the representations and warranties of the Company set forth in this Agreement, other than representations or warranties as to which any of the Purchaser Knowledge Persons had actual knowledge as of the date of this Agreement were not true and correct in all material respects, shall be true and correct in all respects (without regard to any “material” or “materially” or “Material Adverse Effect” qualification contained therein) as of the date of this Agreement and as of the Closing as though made as of the Closing, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all respects (without regard to any “material” or “materially” or “Material Adverse Effect” qualification contained therein), on and as of such earlier date), in each case, except to the extent that the failure of such representations and warranties to be true and correct would not, individually and in the aggregate, have a Material Adverse Effect;

 

(b)           the Company shall have performed and complied in all material respects with all obligations and agreements required in this Agreement to be performed by or complied with it prior to the Closing Date, and Purchaser shall have received a certificate signed by an authorized officer of the Company (in form and substance reasonably satisfactory to Purchaser), dated the Closing Date, certifying to the matters set forth in Section 10.1(a) and this Section 10.1(b);

 

(c)           Purchaser shall have obtained all Permits (including under the Gaming Laws), filings, consents, and approvals necessary to consummate the transactions contemplated hereby, which are set forth on Schedule 10.1(c);

 

(d)           the Company shall have delivered, or caused to be delivered, to Purchaser all of the items set forth in Section 4.2;

 

(e)           all licenses, consents, authorization, clearances, orders and approvals of, and filings and registrations with, any Governmental Entity or other Person, to the extent that the Bankruptcy Court shall not have entered an order providing that such consents or authorizations are not required, listed on Schedule 10.1(e) shall have been obtained;

 

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(f)            no Transfer Failure shall have occurred, except for Transfer Failures which would not be reasonably likely to result in, individually or in the aggregate, a Material Adverse Effect.

 

(g)           no Legal Proceeding shall be pending before any court or Governmental Entity of competent jurisdiction seeking to restrain or prohibit or declare illegal the transactions contemplated by this Agreement or seeking damages in respect thereof;

 

(h)           since the Balance Sheet Date, there shall not have occurred any facts, conditions, changes, violations, inaccuracies, circumstances, effects or events constituting, or which would be reasonably likely to result in, individually or in the aggregate, a Material Adverse Effect; and

 

(i)            the SCI Plan Effective Date shall have occurred.

 

10.2         Conditions Precedent to Obligations of the Company.  The obligations of the Company to consummate the transactions contemplated by this Agreement are subject to the satisfaction, prior to or on the Closing Date, of each of the following conditions (any or all of which may be waived by the Company in whole or in part to the extent permitted by applicable Law):

 

(a)           each of the representations and warranties of Purchaser set forth in this Agreement qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, at and as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties relate to an earlier date (in which case such representations and warranties qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, on and as of such earlier date);

 

(b)           Purchaser shall have performed and complied in all material respects with all obligations and agreements required by this Agreement to be performed or complied with by Purchaser on or prior to the Closing Date, and the Company shall have received a certificate signed by an authorized officer of Purchaser (in form and substance satisfactory to the Company, dated the Closing Date, certifying to the matters set forth in Section 10.2(a) and this Section 10.2(b);

 

(c)           Purchaser shall have delivered, or caused to be delivered, to the Company all of the items set forth in Section 4.3;

 

(d)           no Legal Proceeding shall be pending by a Governmental Entity before any court or Governmental Entity of competent jurisdiction seeking to restrain or prohibit or declare illegal the transactions contemplated by this Agreement or seeking damages in respect thereof; and

 

(e)           Within ten (10) days of the Effective Date, the Propco Lenders and Propco Debtors (each as defined in the SCI Plan)  shall seek an Order of the Bankruptcy Court to permit the use of the cash collateral of Propco (as defined in the SCI Plan) (i) to fund the Deposit Commitment Funds in accordance with the Deposit Commitment Letter and (ii) as a deposit to

 

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be held by the Escrow Agent in accordance with the provisions of this Agreement and the Escrow Agreement.

 

10.3         Conditions Precedent to Obligations of Purchaser and the Company.  The respective obligations of Purchaser and the Company to consummate the transactions contemplated by this Agreement are subject to the satisfaction, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived by Purchaser and the Company in whole or in part to the extent permitted by applicable Law):

 

(a)           there shall not be in effect any Order restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby;

 

(b)           a confirmation order in form and substance acceptable to Purchaser confirming the chapter 11 plan of reorganization of the Company that (i) includes the Sale Order, (ii) shall have been entered by the Bankruptcy Court, and (iii) unless waived in writing by Purchaser, shall be a Final Order; and

 

(c)           the waiting period applicable to the transactions contemplated by this Agreement under any Antitrust Laws shall have expired or early termination shall have been granted without any conditions thereto and no Governmental Entity shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, injunction or other order (whether temporary, preliminary or permanent) which is in effect and which has the effect of making the transactions contemplated hereby illegal or otherwise prohibiting consummation of the transactions contemplated hereby, substantially on the terms contemplated by this Agreement.

 

10.4         Frustration of Closing Conditions.  Neither the Company nor Purchaser may rely on the failure of any condition set forth in Section 10.1, 10.2 or 10.3, as the case may be, if such failure was caused by such Party’s failure to comply with any provision of this Agreement.

 

ARTICLE XI
  TAXES

 

11.1         Transfer Taxes.  Purchaser shall be responsible for (and shall indemnify and hold harmless the Company and its directors, officers, employees, Affiliates, agents, successors and permitted assigns against) any sales, value added, excise, use, stamp, documentary stamp, filing, recording, transfer or similar fees or taxes or governmental charges (including any interest and penalty thereon) in connection with the transfer of the Purchased Assets (collectively, “Transfer Taxes”).  To the extent that any Transfer Taxes are required to be paid by the Company (or such Transfer Taxes are assessed against the Company), Purchaser shall promptly reimburse the Company for such Transfer Taxes.  The Company will cooperate with Purchaser to minimize any Transfer Taxes, including, but not limited to, implementing the transfer of the Purchased Assets pursuant to a chapter 11 plan.  The Company and Purchaser shall cooperate and consult with each other prior to filing any Tax Returns in respect of Transfer Taxes.  The Company and Purchaser shall cooperate and otherwise take commercially reasonable efforts to obtain any available refunds for Transfer Taxes.

 

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11.2         Purchase Price Allocation.  The Purchase Price (including any Assumed Liabilities properly taken into account for tax purposes) shall be allocated, apportioned and adjusted among the Purchased Assets in a manner consistent with applicable Tax Law as set forth on a reasonably detailed schedule (the “Allocation Schedule”) to be provided by Purchaser to the Company within sixty (60) days following the Closing Date, subject to any reasonable objections thereto by the Company, which objections shall be provided to Purchaser within thirty (30) days following the Company’s receipt from Purchaser of a full and complete copy of the Allocation Schedule.  The Parties agree that in case of any such objection to the Allocation Schedule by the Company, (a) Purchaser and the Company shall negotiate in good faith to promptly resolve such dispute, (b) in any event the allocation of the Purchase Price will be agreed to by the Parties no later than ninety (90) days following the Closing Date and (c) the Parties shall abide by such agreed allocation of the Purchase Price for all Tax reporting purposes; provided, however, that in the event that the Parties are unable to reach agreement with respect to such allocation of the Purchase Price within ninety (90) days following the Closing Date, each Party will thereafter be entitled to make any Tax submissions it deems appropriate to any Governmental Entity reflecting its good faith determination of the correct allocation of the Purchase Price.

 

11.3         Cooperation on Tax Matters.  Purchaser and the Company shall furnish or cause to be furnished to each other, as promptly as practicable, such information and assistance relating to the Purchased Assets and the Assumed Liabilities as is reasonably necessary for the preparation and filing of any Tax Return, claim for refund or other required or optional filings relating to Tax matters, for the preparation for any Tax audit, for the preparation for any Tax protest, for the prosecution or defense of any suit or other proceeding relating to Tax matters.

 

ARTICLE XII
  MISCELLANEOUS

 

12.1         Expenses.  Except as otherwise provided in this Agreement, the Company and Purchaser shall bear their own expenses, including attorneys’ fees, incurred in connection with the negotiation and execution of this Agreement and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby; provided that, Purchaser and the Company shall each be responsible for paying one-half of all HSR Act filing fees occasioned by the transactions contemplated hereby and any filing fees under any other Antitrust Laws; provided, further, that in the event of a Legal Proceeding by any Party to enforce obligations under this Agreement, the prevailing party shall be entitled to recover from the non-prevailing Party its expenses of litigation, including reasonable attorney’s fees.

 

12.2         Specific Performance; Other Remedies.  (a) Subject to clause (b) below, the Company and Purchaser acknowledge and agree that the breach of this Agreement would cause irreparable damage to the other party and that the other party will not have an adequate remedy at law.  Therefore, the obligations of the Company and Purchaser under this Agreement, including, without limitation, the Company’s obligation to sell, and Purchaser’s obligation to buy, the Purchased Assets, shall, subject to clause (b) below, be enforceable by a decree of specific performance issued by any court of competent jurisdiction, and appropriate injunctive relief may be applied for and granted in connection therewith.  Such remedies shall, however, be

 

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cumulative and not exclusive and shall be in addition to any other remedies which any party may have under this Agreement or otherwise.  Notwithstanding the foregoing, in the event that specific performance is not available to Purchaser as a remedy, for any reason, Purchaser shall be entitled to any and all other remedies available to it, including damages at law, provided that in no event shall damages be less than 5% of the Purchase Price.  The rights set forth in this Section 12.2 shall be in addition to any other rights which Purchaser may have at law or in equity pursuant to this Agreement.

 

(b)           Notwithstanding anything in this Agreement to the contrary, the Company’s sole and exclusive remedy under this Agreement shall be to terminate this Agreement in accordance with Section 4.5 and, if applicable, to receive payment of the FE Escrowed Funds and the Deposit Commitment Funds in accordance with Section 4.7(c); without limiting the foregoing, the Company shall have no right, whether under clause (a) above or otherwise, to a decree of specific performance or any other remedy at law or in equity.

 

12.3         Submission to Jurisdiction; Consent to Service of Process.

 

(a)           Upon the commencement of the Bankruptcy Case, the Bankruptcy Court shall have jurisdiction over all matters, including any legal action, suit or proceeding arising out of or relating to this Agreement, any related agreements, or the proposed transactions and the interpretation, implementation and enforcement of this Agreement, and the parties hereto irrevocably submit and consent to such jurisdiction.  Until the commencement of the Bankruptcy Case or if the Bankruptcy Case has closed, the Parties agree to unconditionally and irrevocably submit to the exclusive jurisdiction of any state or federal court located in the State of Nevada and any appellate court from any thereof, for the resolution of any such claim or dispute.  The Parties hereby irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of venue of any such dispute brought in such court or any defense of inconvenient forum for the maintenance of such dispute, waiving thereby their right to any other jurisdiction to which they may be entitled to by reason of their present or future domiciles or otherwise.  Each of the Parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

 

(b)           Each of the Parties hereby consents to process being served by any Party in any suit, action or proceeding by delivery of a copy thereof in accordance with the provisions of Section 12.7.

 

12.4         WAIVER OF RIGHT TO TRIAL BY JURY.  EACH PARTY TO THIS AGREEMENT WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION, MATTER OR PROCEEDING REGARDING THIS AGREEMENT OR ANY PROVISION HEREOF.

 

12.5         Entire Agreement; Amendments; Waivers.  This Agreement (including the Schedules and exhibits hereto and the certificates delivered hereunder) and the Confidentiality Agreement represent the entire understanding and agreement between the Parties with respect to the subject matter hereof.  This Agreement can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this

 

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Agreement signed by the Party against whom enforcement of any such amendment, supplement, modification or waiver is sought.  No action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representation, warranty, covenant or agreement contained herein.  The waiver by any Party of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach.  No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  All remedies hereunder are cumulative and are not exclusive of any other remedies provided by law.

 

12.6         Governing Law.  This Agreement shall be governed by and construed in accordance with the Bankruptcy Code and to the extent not inconsistent with the Bankruptcy Code, the laws of the State of Nevada applicable to contracts made and performed in such State, without giving effect to conflict of laws principles thereof.

 

12.7         Notices.  All notices and other communications under this Agreement shall be in writing and shall be deemed given (a) when delivered personally by hand (with written confirmation of receipt), (b) when sent by facsimile (with written confirmation of transmission) or (c) one (1) Business Day following the day sent by overnight courier (with written confirmation of receipt), in each case at the following addresses and facsimile numbers (or to such other address or facsimile number as a Party may have specified by notice given to the other Party pursuant to this provision):

 

If to the Company, to:

 

Green Valley Ranch Gaming, LLC

C/o:  GV Ranch Station, Inc., its Manager

1505 South Pavilion Center Drive

Las Vegas, NV 89135

Attn:  Mr. Richard Haskins

Facsimile:  (702) 495-4260

 

with a copy (which shall not constitute notice) to:

 

Kirkland & Ellis LLP

300 North LaSalle

Chicago, Illinois 60654

Attn:       David Seligman

David Agay

R. Henry Kleeman

Facsimile:  (312) 862-2200

 

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with a copy (which shall not constitute notice or service of process) to:

 

Dewey & LeBoeuf LLP

333 South Grand Avenue, Suite 2600

Los Angeles, CA 90071

Attn:       Bennett J. Murphy

Jason R. Wolf

Facsimile:  (213) 621-6100

 

If to Purchaser, to:

 

Station GVR Acquisition, LLC

c/o Fertitta Entertainment LLC

10801 W. Charleston Boulevard, Suite 600

Las Vegas, NV 89135

Attn:  Mr. Marc J. Falcone

Facsimile:  (702) 495-3290

 

With a copy (which shall not constitute notice) to:

 

Milbank, Tweed, Hadley & McCloy LLP

601 South Figueroa St., Ste. 3000

Los Angeles, CA 90017

Attn:  Kenneth J. Baronsky and Alexander M. Kaye

Facsimile:  (212) 530-5219

 

12.8         Severability.  If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any law or public policy, all other terms or provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any Party.  Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

 

12.9         Binding Effect; Assignment.  This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns, including in the case of the Company, as applicable, the Company as a debtor in possession under the Bankruptcy Code or any trusts created under any chapter 11 plan in the Bankruptcy Case.  Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any Person or entity not a Party to this Agreement except as provided below.  No assignment of this Agreement or of any rights or obligations hereunder may be made by the Company or Purchaser (by operation of law or otherwise) without the prior written consent of the other Parties hereto and any attempted assignment without the required consents shall be void; provided, however, that Purchaser may freely assign this Agreement and any or all rights or obligations hereunder (including, without limitation, Purchaser’s rights to purchase the

 

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Purchased Assets and assume the Assumed Liabilities and Purchaser’s rights to seek indemnification hereunder) to any Affiliate of Purchaser.  Upon any such permitted assignment, the references in this Agreement to Purchaser shall also apply to any such assignee unless the context otherwise requires.

 

12.10       Non-Recourse.  The Parties acknowledge that (i) none of the members of the Company, (ii) none of the members of the Company’s Executive Committee, (iii) none of the members of the Company’s Transaction Committee or Special Committee, (iv) no past, present or future director, officer, committee member, employee, incorporator, member, partner or direct or indirect equity holder of the Company and (v) no past, present or future director, officer, committee member, employee, incorporator, member, partner, Affiliate or direct or indirect equity holder of Purchaser (such individuals described in clauses (i)-(v) above, the “Non-Recourse Parties”) is a party to this Agreement or any Ancillary Agreement.  The Parties further acknowledge that none of the Non-Recourse Parties, whether individually or collectively, shall have any liability whatsoever of any kind or description for any obligations or liabilities of the Company under this Agreement or any Ancillary Agreement or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby or thereby.  Accordingly, the Parties hereby agree that in the event (a) there is any alleged breach or alleged default or breach or default by any Party under this Agreement or any of the Ancillary Agreements or (b) any Party has or may have any claim arising from or relating to the terms of this Agreement or any Ancillary Agreement, no Party shall, or shall have any right to, commence any proceedings or otherwise seek to impose any liability or obligation whatsoever of any kind or description on or against the Non-Recourse Parties, whether collectively or individually, by reason of such alleged breach, default or claim.

 

12.11       Termination of Representations and Warranties.  All representations and warranties made by the Company and Purchaser in this Agreement shall terminate on the Closing Date upon the purchase of the Purchased Assets by Purchaser and neither the Company nor Purchaser shall have any liability after the Closing Date for any breach of any representation or warranty.

 

12.12       Schedules.  The Parties may, at their respective options, include in the Schedules or the Purchaser Schedules, as the case may be, items that are not material to avoid any misunderstanding or for any other reason, and such inclusion, or any references to dollar amounts, shall not be deemed to be an acknowledgment or representation that such items are material, to establish any standard of materiality or to define further the meaning of such terms for purposes of this Agreement.

 

12.13       Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement.

 

12.14       No Third-Party Beneficiaries.  (a) Except as provided in clause (b) below and as otherwise expressly provided in this Agreement (including, without limitation, in Section 12.10), this Agreement is for the sole benefit of the Parties and their permitted assigns and nothing herein, express or implied, is intended to or will confer upon any other Person any legal or

 

59

 

equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

(b) Notwithstanding anything in this Agreement to the contrary, the Debt Financing Sources shall be express third party beneficiaries of Section 4.7(c), Section 8.3(c), Section 12.2(b), Section 12.3, Section 12.4, Section 12.6 and this Section 12.14.

 

[signature page follows]

 

60

 

IN WITNESS WHEREOF, the Parties hereto have caused this Asset Purchase Agreement to be executed by their respective officers, as of the date first written above.

 

	
 
    	
PURCHASER
    
	
 
    	
 
    	
 
    
	
 
    	
STATION   GVR ACQUISITION, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Marc J. Falcone
    
	
 
    	
Name:
    	
Marc   J. Falcone
    
	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
COMPANY
    
	
 
    	
 
    	
 
    
	
 
    	
GREEN   VALLEY RANCH GAMING, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
GV   Ranch Station, Inc., its Manager
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Thomas M. Friel
    
	
 
    	
Name:
    	
Thomas   M. Friel
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

Signature Page to Asset Purchase Agreement

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