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American Greetings Corp – ‘T-3’ on 4/6/06

On:  Thursday, 4/6/06, at 7:43am ET   ·   Accession #:  1193125-6-74324   ·   File #:  22-28806

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 4/06/06  American Greetings Corp           T-3                    2:148K                                   RR Donnelley/FA

Document/Exhibit                   Description                      Pages   Size 

 1: T-3         Applications for Qualification of Indentures        HTML    109K 
 2: EX-99.T3G   Statement of Eligibility and Qualification of the   HTML     34K 
                          Trustee on Form T-1                                    

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-3

FOR APPLICATIONS FOR QUALIFICATION OF INDENTURES

UNDER THE TRUST INDENTURE ACT OF 1939

AMERICAN GREETINGS CORPORATION

(Name of Applicant)

One American Road

Cleveland, Ohio 44144

(216) 252-7300

(Address of Principal Executive Offices)

SECURITIES TO BE ISSUED UNDER THE

INDENTURE TO BE QUALIFIED

Approximate date of proposed public offering:

As soon as practicable after the effective date of this Application for Qualification.

Name and address of agent for service:

Catherine M. Kilbane, Esq.

Senior Vice President, General Counsel and Secretary

American Greetings Corporation

One American Road

Cleveland, Ohio 44144

(216) 252-7300

With a copy to:

John M. Gherlein, Esq.

Baker & Hostetler LLP

3200 National City Center

1900 East 9^th Street

Cleveland, Ohio 44114-3485

The obligor hereby amends this application for qualification on such date or dates as may be necessary to delay its effectiveness until (i) the 20th day after the filing of an amendment which specifically states that it shall supersede this application, or (ii) such date as the Commission, acting pursuant to Section 307(c) of the Trust Indenture Act of 1939, as amended, may determine upon the written request of the obligor.

GENERAL

Upon the terms set forth in an Offering Memorandum dated April 6, 2006 (the “Offering Memorandum”), the Company is offering to exchange $1,000 principal amount of its 7.00% Convertible Subordinated Notes due July 15, 2006 (the “New Notes”), for each $1,000 principal amount of its currently outstanding 7.00% Convertible Subordinated Notes due July 15, 2006 (the “Old Notes”) (the “Exchange Offer”). If the Exchange Offer is completed, then (i) holders who tender their Old Notes and do not withdraw the prior to the completion will receive an exchange fee in cash in an amount equal to $3.75 for every $1,000 principal amount of the Old Notes that they tender (the “Exchange Fee”) and (ii) the New Notes will be governed by the new indenture (the “Indenture”) to be qualified under this Application for Qualification on Form T-3.

As the New Notes are proposed to be offered for exchange by the Company with its existing noteholders exclusively and solely for the Old Notes of the Company, the transaction is exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the provisions of Section 3(a)(9) thereof. No sales of securities of the same class as the New Notes have been or are to be made by the Company by or through an underwriter at or about the same time as the Exchange Offer for which the exemption is claimed. No consideration has been, or is to be, given, directly or indirectly, to any person in connection with the transaction, except for (i) the customary payments to be made in respect of preparation, printing, and mailing of the Offering Memorandum and related documents, (ii) the engagements of Global Bondholder Services Corporation, as exchange agent for the Exchange Offer and Global Bondholder Services Corporation, as information agent for the Exchange Offer and payments of the fees and expenses of its financial and legal advisors and (iii) the payment of the Exchange Fee. Neither the exchange agent nor the information agent will solicit exchanges in connection with the Exchange Offer and will not make recommendations as to acceptance or rejection of the Exchange Offer. No holder of the Old Notes has made or will be requested to make any cash payment to the Company in connection with the Exchange Offer.

AFFILIATIONS

For purposes of this Application only, the officers and directors of the Company named in response to Item 4 hereof may be deemed affiliates of the Company by virtue of the positions held by such persons with the Company.

The following is a list of all affiliates of the Company as of the date of this application.

Affiliate Companies

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MANAGEMENT AND CONTROL

The following table lists the names of all directors and executive officers of the Company as of the date hereof. The mailing address of each director and executive officer is: c/o American Greetings Corporation, One American Road, Cleveland, Ohio 44144.

The following table provides information as to each person who beneficially owned more than 10% of the Company’s outstanding voting securities as of March 31, 2006:

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UNDERWRITERS

6. Underwriters

(a) No person has acted as an underwriter of any securities of the Company within three years prior to the date hereof.

(b) No person is acting as a principal underwriter of the New Notes proposed to be offered pursuant to the Indenture.

CAPITAL SECURITIES

7. Capitalization

(a) The authorized and outstanding capital stock and debt securities of the Company as of March 29, 2006 were as follows:

(b) Each Class A Common Share is entitled to one vote upon all matters presented to shareholders. Any proposal to amend the Articles of Incorporation to increase the number of authorized Class A Common Shares or Class B Common Shares requires for its adoption the affirmative vote of at least two-thirds of the then outstanding Class A Common Shares, voting as a class. Each Class B Common Share is entitled to ten votes upon all matters presented to shareholders. Any proposal to amend the Articles of Incorporation to increase the number of authorized Class A Common Shares or Class B Common Shares requires for its adoption the affirmative vote of at least two-thirds of the then outstanding Class B Common Shares, voting as a class.

INDENTURE SECURITIES

8. Analysis of Indenture Provisions

The New Notes will be issued under the Indenture to be dated as of the consummation of the Exchange Offer and entered into between the Company and U.S. Bank National Association, as trustee (the “Trustee”). The following analysis is not a complete description of the Indenture provisions discussed and is qualified in its entirety by reference to the terms of the Indenture, a form of which is attached as Exhibit T3C hereto and incorporated by reference herein. Capitalized terms used below but not defined herein have the meanings assigned to them in the Indenture.

(a) Events of Default

The following will be Events of Default under the Indenture:

(1) the Company fails to pay principal of or premium, if any, on any of the New Notes when due, whether or not prohibited by the subordination provisions of the Indenture;

(2) the Company fails to pay any interest on any of the New Notes when due, which failure continues for 30 days, whether or not prohibited by the subordination provisions of the Indenture;

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(3) the Company fails to provide notice of a change in control, whether or not such payment is prohibited by the subordination provisions of the Indenture;

(4) the Company fails to perform any other covenant in the Indenture, which failure continues for 60 days after written notice as provided in the Indenture;

(5) any indebtedness under any bonds, debentures, notes or other evidences of indebtedness for money borrowed (or any guarantee thereof) by the Company in an aggregate principal amount in excess of $20,000,000 is not paid when due either at its stated maturity or upon acceleration thereof, and such indebtedness is not discharged, or such acceleration is not rescinded or annulled, within a period of 60 days after notice as provided in the Indenture; and

(6) certain events of bankruptcy, insolvency or reorganization involving the Company, whether through (i) the entry of such events by a court of proper jurisdiction or (ii) the commencement of such events by the Company itself.

If an Event of Default, other than an Event of Default described in clause (6) above, occurs and is continuing, either the Trustee or the holders of at least 25% in aggregate principal amount of the outstanding New Notes may declare the principal amount of the New Notes to be due and payable immediately. However, after such an acceleration, but before a judgment or decree based on the acceleration, the holders of a majority in aggregate principal amount of the outstanding new notes may, under certain circumstances, rescind and annul the acceleration if all Events of Default, other than the non-payment of principal of the New Notes which have become due solely by such declaration of acceleration, have been cured or waived as provided in the Indenture. If an Event of Default described in clause (6) above occurs, the principal amount of the New Notes will automatically become immediately due and payable.

If a default or an Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee must mail to each holder notice of the default or Event of Default within 90 days after the occurrence of the default. However, the Trustee may withhold the notice if and so long as the board of directors, the executive committee or a trust committee of directors or certain responsible officers of the Trustee determines that withholding notice is in the interests of holders, except in the case of a default or an Event of Default in payment of the principal of or interest on any New Notes.

Subject to the Trustee’s duties in the case of an Event of Default, the Trustee will not be obligated to exercise any of its rights or powers at the request of the holders, unless the holders have offered to the Trustee reasonable indemnity. Subject to the Indenture, applicable law and the Trustee’s indemnification, the holders of a majority in aggregate principal amount of the outstanding New Notes will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the New Notes.

No holder will have any right to institute any proceeding under the Indenture, or for any other remedy under the Indenture unless:

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(b) Authentication and Delivery of New Notes; Use of Proceeds

The New Notes to be issued under the Indenture may be executed by manual or facsimile signature on behalf of the Company by its Chairman of the Board, its Vice Chairman of the Board, its Chief Executive Officer, its President, one of its Executive Vice Presidents or one of its Vice Presidents.

The Trustee will authenticate and make available for delivery New Notes for original issue, upon receipt of a written order or orders of the Company signed on behalf of the Company by (i) its Chairman of the Board, its Vice Chairman of the Board, its Chief Executive Officer, its President, one of its Executive Vice Presidents or one of its Vice Presidents and (ii) its principal financial officer, its Treasurer, one of its Assistant Treasurers, its Secretary or one of its Assistant Secretaries. Such order of the Company must specify the amount of New Notes to be authenticated and the date on which the original issue of New Notes is to be authenticated.

The New Notes will not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the New Notes. The signature will be conclusive evidence that the New Notes have been authenticated under the Indenture.

The Company will not receive any proceeds from the issuance of the New Notes because the New Notes are being issued in exchange for the Old Notes.

(c) Release and Substitution of Property Subject to the Lien of the Indenture

The New Notes are unsecured obligations of the Company. As such, the New Notes are not secured by any lien on any property.

(d) Satisfaction and Discharge of the Indenture

The Company may discharge its obligations under the Indenture while New Notes remain outstanding if (i) either (a) all delivered and authenticated New Notes (other than those held in trust, destroyed, lost or stolen) have been delivered to the Trustee for cancellation or (b) all outstanding New Notes have or will become due and payable at their scheduled maturity within one year and the Company has deposited with the Trustee an amount sufficient to pay and discharge all outstanding New Notes on the date of their scheduled maturity, (ii) the Company has paid or caused to be paid all other sums payable by the Company under the Indenture and (iii) the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent for discharge of the Indenture have been complied with.

(e) Evidence Required to be Furnished by the Company to the Trustee as to Compliance with the Conditions and Covenants Provided for in the Indenture

The Company is required to deliver to the Trustee, within 90 days after the end of each fiscal year of the Company, an officers’ certificate, signed by the principal executive officer, principal financial officer, treasurer or principal accounting officer and one other officer, stating the signer’s knowledge of the Company’s compliance with all conditions and covenants on its part contained in the Indenture and stating whether or not the signer knows of any default or Event of Default. If such signer knows of such a default or Event of Default, the officers’ certificate must describe the default or Event of Default and the efforts to remedy the same.

9. Other Obligors

None.

CONTENTS OF APPLICATION FOR QUALIFICATION

(a) Pages numbered 1 to 10, consecutively.

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(b) The statement of eligibility and qualification on Form T-1 of U.S. Bank National Association, Trustee under the Indenture to be qualified (included as Exhibit T3G hereto).

(c) The following Exhibits in addition to those filed as part of the Form T-1 statement of eligibility and qualification of the trustee:

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SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939, the applicant, American Greetings Corporation, a corporation organized and existing under the laws of the State of Ohio, has duly caused this application to be signed on its behalf by the undersigned, thereunto duly authorized, and its seal to be hereunto affixed and attested, all in the City of Cleveland and State of Ohio, on the 6th day of April, 2006.

(SEAL)

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Exhibit T3F

CROSS-REFERENCE TABLE*

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Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘T-3’ Filing		Date		Other Filings
		7/15/06		8-K
Filed on:		4/6/06		8-K,  POS AM,  SC TO-I
		3/31/06
		3/29/06
		2/14/06		SC 13G/A
		2/13/06		SC 13G/A
		12/31/05		11-K
		12/30/05
		5/27/99		10-K405
				List all Filings

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Filing Submission 0001193125-06-074324   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

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