1
EXHIBIT 4.21
================================================================================
$200,000,000
16% Senior Subordinated Notes due 2003
INDENTURE
between
TRANSAMERICAN REFINING CORPORATION,
as Issuer
and
First Union National Bank
as Trustee
Dated as of December 30, 1997
================================================================================
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CROSS-REFERENCE TABLE
TIA INDENTURE
SECTION SECTION
------- ---------
310(a)(1)............................................................................... 7.10
(a)(2)............................................................................ 7.10
(a)(3)............................................................................ N.A.
(a)(4)............................................................................ N.A.
(a)(5)............................................................................ 7.10
(b) ............................................................................. 7.08; 7.10
(c) ............................................................................. N.A.
311(a) ............................................................................. 7.11
(b) ............................................................................. 7.11
(c) ............................................................................. N.A.
312(a) ............................................................................. 2.05
(b) ............................................................................. 13.03
(c) ............................................................................. 13.03
313(a) ............................................................................. 7.06
(b)(1)............................................................................ 7.06
(b)(2)............................................................................ 7.06
(c) ............................................................................. 7.06; 13.02
(d) ............................................................................. 7.06
314(a) ............................................................................. 4.08; 13.02
(b) ............................................................................. 12.03(b)
(c)(1)............................................................................ 2.02; 7.02;
13.04
(c)(2)............................................................................ 7.02; 13.04
(c)(3)............................................................................ N.A.
(d) ............................................................................ 12.03(b);
12.04(b)
(e) ............................................................................. 13.05
(f) ............................................................................. N.A.
315(a) ............................................................................. 7.01(b)
(b) ............................................................................. 7.05; 13.02
(c) ............................................................................. 7.01(a)
(d) ............................................................................. 6.11; 7.01(c)
(e) ............................................................................. 6.13
316(a)(last sentence)................................................................... 2.09
(a)(1)(A)......................................................................... 6.11
(a)(1)(B)......................................................................... 6.12
(a)(2)............................................................................ N.A.
(b) ............................................................................. 6.12; 6.08
(c) ............................................................................. 10.05
317(a)(1)............................................................................... 6.03
(a)(2)............................................................................ 6.04
(b) ............................................................................. 2.04
318(a) ............................................................................. 13.01
--------------
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE......................................................1
Section 1.1 Definitions...................................................................1
Section 1.2 Incorporation by Reference of TIA............................................22
Section 1.3 Rules of Construction........................................................23
ARTICLE II THE NOTES......................................................................................23
Section 2.1 Form and Dating..............................................................23
Section 2.2 Execution and Authentication.................................................24
Section 2.3 Registrar and Paying Agent...................................................25
Section 2.4 Paying Agent to Hold Assets in Trust.........................................25
Section 2.5 Noteholder Lists.............................................................25
Section 2.6 Transfer and Exchange........................................................25
Section 2.7 Replacement Notes............................................................29
Section 2.8 Outstanding Notes............................................................29
Section 2.9 Treasury Notes...............................................................29
Section 2.10 Temporary Notes..............................................................29
Section 2.11 Cancellation.................................................................30
Section 2.12 Defaulted Interest...........................................................30
Section 2.13 Computation of Interest......................................................31
Section 2.14 Legends......................................................................31
Section 2.15 Separation of Notes and Warrants.............................................32
ARTICLE III REDEMPTION.....................................................................................32
Section 3.1 Right of Redemption..........................................................32
Section 3.2 Notices to Trustee...........................................................32
Section 3.3 Selection of Notes to Be Redeemed............................................32
Section 3.4 Notice of Redemption.........................................................33
Section 3.5 Effect of Notice of Redemption...............................................34
Section 3.6 Deposit of Redemption Price..................................................34
Section 3.7 Notes Redeemed in Part.......................................................34
ARTICLE IV COVENANTS......................................................................................35
Section 4.1 Payment of Notes.............................................................35
Section 4.2 Maintenance of Office or Agency..............................................35
Section 4.3 Limitation on Restricted Payments............................................35
Section 4.4 Corporate Existence..........................................................36
Section 4.5 Payment of Taxes and Other Claims............................................36
Section 4.6 Maintenance of Properties and Insurance......................................36
Section 4.7 Compliance Certificate; Notice of Default....................................37
Section 4.8 SEC Reports..................................................................37
Section 4.9 Limitation on Status as Investment Company
or Public Utility Company....................................................38
Section 4.10 Limitation on Transactions with Related Persons..............................38
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Section 4.11 Limitation on Incurrences of Additional Debt
and Issuances of Disqualified Capital Stock..................................39
Section 4.12 Limitations on Restricting Subsidiary Dividends..............................41
Section 4.13 Liens........................................................................41
Section 4.14 Limitation on Asset Sales....................................................42
Section 4.15 Waiver of Stay, Extension or Usury Laws......................................44
Section 4.16 Guarantee by Subsidiaries....................................................45
Section 4.17 Intentionally Omitted........................................................46
Section 4.18 Limitations on Line of Business..............................................46
Section 4.19 Separate Existence and Formalities...........................................46
Section 4.20 Accounts Receivable Subsidiary...............................................46
Section 4.21 Limitation on Ranking of Future Debt.........................................47
Section 4.22 Maintenance of Interest Reserve Account......................................47
Section 4.23 Restriction on Sale and Issuance of Subsidiary Stock.........................49
Section 4.24 [Intentionally Omitted]......................................................49
ARTICLE V SUCCESSOR CORPORATION..........................................................................49
Section 5.1 When the Company May Merge, Etc..............................................49
Section 5.2 Successor Corporation Substituted............................................50
ARTICLE VI EVENTS OF DEFAULT AND REMEDIES.................................................................51
Section 6.1 Events of Default............................................................51
Section 6.2 Acceleration of Maturity Date; Rescission and Annulment......................52
Section 6.3 Collection of Indebtedness and Suits for Enforcement by Trustee..............53
Section 6.4 Trustee May File Proofs of Claim.............................................54
Section 6.5 Trustee May Enforce Claims Without Possession of Notes.......................54
Section 6.6 Priorities...................................................................55
Section 6.7 Limitation on Suits..........................................................55
Section 6.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest.........................................................55
Section 6.9 Rights and Remedies Cumulative...............................................56
Section 6.10 Delay or Omission Not Waiver.................................................56
Section 6.11 Control by Holders...........................................................56
Section 6.12 Waiver of Past Default.......................................................56
Section 6.13 Undertaking for Costs........................................................56
Section 6.14 Restoration of Rights and Remedies...........................................57
ARTICLE VII TRUSTEE........................................................................................57
Section 7.1 Duties of Trustee............................................................57
Section 7.2 Rights of Trustee............................................................58
Section 7.3 Individual Rights of Trustee.................................................59
Section 7.4 Trustee's Disclaimer.........................................................59
Section 7.5 Notice of Default............................................................59
Section 7.6 Reports by Trustee to Holders................................................59
Section 7.7 Compensation and Indemnity...................................................59
Section 7.8 Replacement of Trustee.......................................................60
Section 7.9 Successor Trustee by Merger, Etc.............................................61
Section 7.10 Eligibility; Disqualification................................................61
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Section 7.11 Preferential Collection of Claims against Company............................61
Section 7.12 No Bond......................................................................61
Section 7.13 Condition to Action..........................................................61
Section 7.14 Investment...................................................................61
ARTICLE VIII SATISFACTION AND DISCHARGE.....................................................................61
Section 8.1 Satisfaction, Discharge of the Indenture and
Defeasance of the Notes......................................................61
Section 8.2 Termination of Obligations Upon Cancellation of the Notes....................63
Section 8.3 Survival of Certain Obligations..............................................63
Section 8.4 Acknowledgment of Discharge by Trustee.......................................63
Section 8.5 Application of Trust Assets..................................................63
Section 8.6 Repayment to the Company.....................................................63
Section 8.7 Reinstatement................................................................64
ARTICLE IX AMENDMENTS, SUPPLEMENTS AND WAIVERS............................................................64
Section 9.1 Supplemental Indentures Without Consent of Holders...........................64
Section 9.2 Amendments, Supplemental Indentures and Waivers
with Consent of Holders......................................................64
Section 9.3 Compliance with TIA..........................................................66
Section 9.4 Revocation and Effect of Consents............................................66
Section 9.5 Notation on or Exchange of Notes.............................................66
Section 9.6 Trustee to Sign Amendments, Etc..............................................66
ARTICLE X MEETINGS OF NOTEHOLDERS........................................................................67
Section 10.1 Purposes for Which Meetings May Be Called....................................67
Section 10.2 Manner of Calling Meetings...................................................67
Section 10.3 Call of Meetings by Company or Holders.......................................67
Section 10.4 Who May Attend and Vote at Meetings..........................................68
Section 10.5 Regulations May Be Made by Trustee; Conduct
of the Meeting; Voting Rights; Adjournment...................................68
Section 10.6 Voting at the Meeting and Record to Be Kept..................................68
Section 10.7 Exercise of Rights of Trustee or Noteholders May
Not Be Hindered or Delayed by Call of Meeting................................69
ARTICLE XI RIGHT TO REQUIRE REPURCHASE....................................................................69
Section 11.1 Repurchase of Notes at Option of the Holder
Upon Change of Control.......................................................69
ARTICLE XII SUBORDINATION..................................................................................71
Section 12.1 Notes Subordinated to Senior Indebtedness....................................71
Section 12.2 No Payment on Securities in Certain Circumstances............................71
Section 12.3 Notes Subordinated to Prior Payment of All Senior
Debt on Dissolution, Liquidation or Reorganization...........................72
Section 12.4 Securityholders to Be Subrogated to Rights of Holders
of Senior Debt...............................................................72
Section 12.5 Obligations of the Company Unconditional.....................................73
Section 12.6 Trustee Entitled to Assume Payments Not Prohibited
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in Absence of Notice.........................................................73
Section 12.7 Application by Trustee of Assets Deposited with It...........................73
Section 12.8 Subordination Rights Not Impaired by Acts or Omissions
of the Company or Holders of Senior Debt.....................................74
Section 12.9 Holders of Notes Authorize Trustee to Effectuate
Subordination of Securities..................................................74
Section 12.10 Right of Trustee to Hold Senior Debt.........................................74
Section 12.11 Article XII Not to Prevent Events of Default.................................75
Section 12.12 No Fiduciary Duty of Trustee to Holders of Senior Debt.......................75
ARTICLE XIII MISCELLANEOUS..................................................................................75
Section 13.1 TIA Controls.................................................................75
Section 13.2 Notices......................................................................75
Section 13.3 Communications by Holders with Other Holders.................................76
Section 13.4 Certificate and Opinion as to Conditions Precedent...........................76
Section 13.5 Statements Required in Certificate or Opinion................................76
Section 13.6 Rules by Trustee, Paying Agent, Registrar....................................76
Section 13.7 Legal Holidays...............................................................77
Section 13.8 Governing Law................................................................77
Section 13.9 No Adverse Interpretation of Other Agreements................................77
Section 13.10 No Recourse against Others...................................................77
Section 13.11 Successors...................................................................77
Section 13.12 Duplicate Originals..........................................................77
Section 13.13 Severability.................................................................77
Section 13.14 Table of Contents, Headings, Etc.............................................78
SIGNATURES.......................................................................................................79
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Unit
Exhibit C - Certificate of Transferor
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of this Indenture.
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INDENTURE, dated as of December 30, 1997, among TRANSAMERICAN REFINING
CORPORATION, a Texas corporation (the "Company"), and FIRST UNION NATIONAL BANK,
as Trustee.
Each party hereto agrees as follows for the benefit of each other party
and for the equal and ratable benefit of the Holders of the Company's 16% Senior
Subordinated Notes due 2003:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions.
"Accounts Receivable Subsidiary" means a subsidiary of TEC designated
as an Accounts Receivable Subsidiary for the purpose of financing the accounts
receivable of the Company.
"Accounts Receivable Subsidiary Notes" means the notes to be issued by
the Accounts Receivable Subsidiary for the purchase of accounts receivable.
"Adjusted Consolidated Net Income" of any Person for any period means
the net income (loss) of such Person and its consolidated Subsidiaries for such
period, determined in accordance with GAAP, excluding (without duplication) (i)
all extraordinary gains, (ii) the net income, if positive, of any other Person,
other than a consolidated Subsidiary, in which such Person or any of its
consolidated Subsidiaries has an interest, except to the extent of the amount of
any dividends or distributions actually paid in cash to such Person or a
consolidated Subsidiary of such Person during such period, (iii) the net income,
if positive, of any Person acquired in a pooling of interests transaction for
any period prior to the date of such acquisition and (iv) the net income, if
positive, of any Subsidiary of such Person to the extent that the declaration or
payment of dividends or similar distributions is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule, or governmental regulation applicable to such
Subsidiary.
"Adjusted Net Assets" of a Guarantor means the lesser of (a) the amount
by which the Guarantor's property, at a fair valuation, exceeds the sum of its
debts (including unliquidated or contingent debts), (b) the amount by which the
present fair salable value of the Guarantor's assets exceeds the amount that
will be required to pay its probable liability on its existing debts as they
become absolute and matured, (c) the amount by which the Guarantor's assets
exceed the maximum amount that would constitute unreasonably small capital for
its business or (d) the amount by which the Guarantor's assets exceed the amount
that such Guarantor should reasonably retain to pay its debts (including
unliquidated or contingent debts) as they mature.
"Affiliate" means, with respect to any specified Person, (i) any other
Person directly or indirectly controlling or controlled by, or under direct or
indirect common control with, such specified Person or (ii) any officer,
director or controlling shareholder of such other Person. For purposes of this
definition, the term "control" means (a) the power to direct the management and
policies of a Person, directly or through one or more intermediaries, whether
through the ownership of voting securities, by contract, or otherwise, or (b)
without limiting the foregoing, the beneficial ownership of 5% or more of the
voting power of the voting
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common equity of such Person (on a fully diluted basis) or of warrants or other
rights to acquire such equity (regardless of whether presently exercisable).
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Alkylation Unit" means the alkylation unit being constructed as part
of the Capital Improvement Program.
"Appraisal" means, when used with respect to the valuation of any
property, an appraisal prepared by an Appraiser as to the Appraised Value of
such property.
"Appraised Value" means, with respect to any property at any date, the
then current fair market value of such property as set forth in the most recent
Appraisal.
"Appraiser" means an independent appraiser of national recognition
qualified to appraise the property appraised.
"Asset Sale" means any direct or indirect conveyance, sale, transfer or
other disposition (including through damage or destruction for which Insurance
Proceeds are paid or by condemnation), in one transaction or a series of related
transactions, of any of the properties, businesses or assets of the Company or
any Subsidiary of the Company, whether owned on the Issue Date or thereafter
acquired; provided, however, that "Asset Sale" shall not include (i) any
disposition of Receivables, Inventory or Equipment, or (ii) any pledge or
disposition of assets (if such pledge or disposition would otherwise constitute
an Asset Sale) to the extent and only to the extent that it results in the
creation of a Permitted Lien.
"Attributable Debt" in respect of a Sale and Leaseback Transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP or,
in the event that such rate of interest is not reasonably determinable,
discounted at the rate of interest borne by the Notes) of the obligation of the
lessee for net rental payments during the remaining term of the lease included
in such Sale and Leaseback Transaction (including any period for which such
lease has been extended or may, at the option of the lessor, be extended).
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any Person, the Board of
Directors of such Person or any committee of the Board of Directors of such
Person authorized, with respect to any particular matter, to exercise the power
of the Board of Directors of such Person.
"Board Resolution" means, with respect to any Person, a duly adopted
resolution of the Board of Directors of such Person.
"Business Day" means a day that is not a Legal Holiday.
"Capital Expenditures" of a Person means expenditures (whether paid in
cash or accrued as a liability) by such Person or any of its Subsidiaries that,
in conformity with GAAP, are or would be included in "capital expenditures,"
"additions to property, plant, or equipment" or comparable items in the
consolidated financial statements of such Person consistent with prior
accounting practices.
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"Capital Improvement Program" means the expansion and improvement
program at the Company as described in the Registration Statement on Form S-4,
as amended, of TEC under the heading "Business of TARC--Capital Improvement
Program" and including both Phase I and Phase II.
"Capital Stock" means, with respect to any Person, any capital stock of
such Person and shares, interests, participations, or other ownership interests
(however designated) of such Person and any rights (other than debt securities
convertible into corporate stock), warrants or options to purchase any of the
foregoing, including without limitation, each class of common stock and
preferred stock of such Person, if such Person is a corporation, and each
general or limited partnership interest or other equity interest of such Person,
if such Person is a partnership.
"Capitalized Lease Obligation" means obligations under a lease that are
required to be capitalized for financial reporting purposes in accordance with
GAAP, and the amount of Debt represented by such obligations shall be the
capitalized amount of such obligations, as determined in accordance with GAAP.
"cash" means U.S. Legal Tender.
"Cash Equivalents" means (a) United States dollars, (b) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than one year from the date of acquisition, (c) certificates of deposit
with maturities of one year or less from the date of acquisition, bankers'
acceptances with maturities not exceeding one year, and overnight bank deposits,
in each case, with any Eligible Institution, (d) repurchase obligations with a
term of not more than seven days for underlying securities of the types
described in clauses (b) and (c) entered into with any Eligible Institution, (e)
commercial paper rated "P-1," "A-1" or the equivalent thereof by ▇▇▇▇▇'▇
Investors Service, Inc. or Standard & Poor's Corporation, Inc., respectively,
and in each case maturing within one year after the date of acquisition, (f)
shares of money market funds, including those of the Trustee, that invest solely
in United States dollars and securities of the types described in clauses (a)
through (e), (g) demand and time deposits and certificates of deposit with any
commercial bank organized in the United States not meeting the qualifications
specified in clause (c) above or an Eligible Institution, provided that such
deposits and certificates support bonds, letters of credit and other similar
types of obligations incurred in the ordinary course of business, (h) deposits,
including deposits denominated in foreign currency, with any Eligible
Institution; provided that all such deposits do not exceed $10,000,000 in the
aggregate at any one time, and (i) demand or fully insured time deposits used in
the ordinary course of business with commercial banks insured by the Federal
Deposit Insurance Corporation.
"CATOFIN(R) Unit" means certain real property currently owned by the
Company as more specifically defined in the security documents relating to the
TEC Notes, together with all personal property of the Company now or hereinafter
located on such real property but only to the extent that such property is part
of a refining unit designed to produce propane and butane mono-olefins using the
CATOFIN(R) process.
"Change of Control" means (i) the liquidation or dissolution of, or the
adoption of a plan of liquidation by, the Company, or (ii) any transaction,
event or circumstance pursuant to which any "person" or "group" (as such terms
are used for purposes of Section 13(d) and 14(d) of the Exchange Act, whether or
not applicable), other than ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (or his heirs, his estate, or any
trust in which he or his immediate family members have, directly or indirectly,
a beneficial interest in excess of 50%) and his Subsidiaries or the TEC
Indenture Trustee, is or becomes the "beneficial owner" (as that term is used in
Rules 13d-3 and 13d-5 under the Exchange Act, whether or not applicable),
directly or indirectly, of more than 50%, on a
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fully diluted basis, of the total voting power of the Company's then outstanding
Voting Stock unless, at the time of the occurrence of an event specified in
clauses (i) or (ii), the Notes have a current rating issued by a Rating Agency;
provided, however, that if, at any time within the period commencing on the date
that is immediately prior to the date of the first public announcement of such
event and ending on, but not including, the date that is 90 days after
occurrence of such event (which period shall be deemed to be extended so long as
prior to the end of such 90-days period and continuing thereafter the rating of
the Notes is under publicly announced consideration for possible downgrade by
either Rating Agency) either (a) the Notes are downgraded by either Rating
Agency to a rating at least one gradation (including a change within rating
categories, e.g., a decline in rating from BB+ to BB, or from B to B--) below
that which existed on the date immediately prior to the date of the first public
announcement of such an event, or (b) either Rating Agency withdraws its rating
of the Notes, then, in either case, such event shall be a "Change of Control."
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or if at any time after the
execution of this Indenture such Commission is not existing and performing the
duties now assigned to it under the TIA, then the body performing such duties at
such time.
"Common Stock" means the Company's common stock, $0.01 par value.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means such
successor.
"Consolidated EBITDA" of any Person for any period, unless otherwise
defined herein, means (a) the Consolidated Net Income of such Person for such
period, plus (b) the sum, without duplication (and only to the extent such
amounts are deducted from net revenues in determining such Consolidated Net
Income), of (i) the provision for income taxes for such period for such Person
and its consolidated Subsidiaries, (ii) depreciation, depletion, and
amortization of such Person and its consolidated Subsidiaries for such period
and (iii) Consolidated Fixed Charges of such Person for such period, determined,
in each case, on a consolidated basis for such Person and its consolidated
Subsidiaries in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" on any date (the
"Transaction Date") means, with respect to any Person, the ratio, on a pro forma
basis, of (i) the aggregate amount of Consolidated EBITDA of such Person
(attributable to continuing operations and businesses and exclusive of the
amounts attributable to operations and businesses discontinued or disposed of,
on a pro forma basis as if such operations and businesses were discontinued or
disposed of on the first day of the Reference Period) for the Reference Period
to (ii) the aggregate Consolidated Fixed Charges of such Person (exclusive of
amounts attributable to discontinued operations and businesses on a pro forma
basis as if such operations and businesses were discontinued or disposed of on
the first day of the Reference Period, but only to the extent that the
obligations giving rise to such Consolidated Fixed Charges would no longer be
obligations contributing to such Person's Consolidated Fixed Charges subsequent
to the Transaction Date) during the Reference Period; provided, that for
purposes of such computation, in calculating Consolidated EBITDA and
Consolidated Fixed Charges, (a) the transaction giving rise to the need to
calculate the Consolidated Fixed Charge Coverage Ratio shall be assumed to have
occurred on the first day of the Reference Period, (b) the incurrence of any
Debt or issuance of Disqualified Capital Stock or the retirement of any Debt or
Capital Stock during the Reference Period or subsequent thereto and on or prior
to the Transaction Date shall be assumed to have occurred on the first day of
such Reference Period, (c) Consolidated Interest Expense attributable to any
Debt (whether existing or being incurred) bearing a floating interest rate shall
be computed as if the rate in effect on the Transaction Date had been the
applicable rate for the entire
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period, unless such Person or any of its Subsidiaries is a party to a Swap
Obligation (that remains in effect for the 12-month period after the Transaction
Date) that has the effect of fixing the interest rate on the date of
computation, in which case such rate (whether higher or lower) shall be used.
"Consolidated Fixed Charges" of any Person for any period means
(without duplication) the sum of (i) Consolidated Interest Expense of such
Person for such period, (ii) dividend requirements of such Person and its
consolidated Subsidiaries (whether in cash or otherwise (except dividends
payable solely in shares of Qualified Capital Stock)) with respect to Preferred
Stock paid, accrued, or scheduled to be paid or accrued during such period, in
each case to the extent attributable to such period and excluding items
eliminated in consolidation and (iii) fees paid, accrued, or scheduled to be
paid or accrued during such period by such Person and its Subsidiaries in
respect of performance bonds or other guarantees of payment. For purposes of
clause (ii) above, dividend requirements shall be increased to an amount
representing the pre-tax earnings that would be required to cover such dividend
requirements; accordingly, the increased amount shall be equal to a fraction,
the numerator of which is such dividend requirements and the denominator of
which is 1 minus the applicable actual combined effective Federal, state, local,
and foreign income tax rate of such Person and its subsidiaries (expressed as a
decimal), on a consolidated basis, for the fiscal year immediately preceding the
date of the transaction giving rise to the need to calculate Consolidated Fixed
Charges.
"Consolidated Interest Expense" of any Person means, for any period,
the aggregate interest (without duplication), whether expensed or capitalized,
paid, accrued, or scheduled to be paid or accrued during such period in respect
of all Debt of such Person and its consolidated Subsidiaries (including (i)
amortization of deferred financing costs and original issue discount and
non-cash interest payments or accruals, (ii) the interest portion of all
deferred payment obligations, calculated in accordance with the effective
interest method and (iii) all commissions, discounts, other fees, and charges
owed with respect to letters of credit and banker's acceptance financing and
costs associated with Swap Obligations, in each case to the extent attributable
to such period but excluding any interest accrued on intercompany payables for
taxes to the extent the liability for such taxes has been assumed by
TransAmerican pursuant to the Tax Allocation Agreement) determined on a
consolidated basis in accordance with GAAP. For purposes of this definition, (x)
interest on a Capitalized Lease Obligation shall be deemed to accrue at an
interest rate reasonably determined to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP (including Statement of
Financial Accounting Standards No. 13 of the Financial Accounting Standards
Board), and (y) Consolidated Interest Expense attributable to any Debt
represented by the guarantee by such Person or a Subsidiary of such Person other
than with respect to Debt of such Person or a Subsidiary of such Person shall be
deemed to be the interest expense attributable to the item guaranteed.
"Consolidated Net Income" of any Person for any period means the net
income (loss) of such Person and its consolidated Subsidiaries for such period,
determined in accordance with GAAP, excluding (without duplication) (i) all
extraordinary, unusual and nonrecurring gains, (ii) the net income, if positive,
of any other Person, other than a consolidated Subsidiary, in which such Person
or any of its consolidated Subsidiaries has an interest, except to the extent of
the amount of any dividends or distributions actually paid in cash to such
Person or a consolidated Subsidiary of such Person during such period, but not
in excess of such Person's pro rata share of such other Person's aggregate net
income earned during such period or earned during the immediately preceding
period and not distributed during such period, (iii) the net income, if
positive, of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition and (iv) the net income, if
positive, of any Subsidiary of such Person to the extent that the declaration or
payment of dividends or similar distributions is not at the time permitted by
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operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule, or governmental regulation applicable to such
Subsidiary.
"Consolidated Net Tangible Assets" means, as of any date, the total
assets of the Company and its Subsidiaries on a consolidated basis as of such
date (less applicable reserves and other items properly deductible from total
assets) and after deduction therefrom: (i) total liabilities and total capital
items as of such date except the following: items constituting Debt,
paid-in-capital and retained earnings, provisions for deferred income taxes and
deferred gains, and reserves which are not reserves for any contingencies not
allocated to any particular purpose; (ii) good will, trade names, trademarks,
patents, unamortized debt discount and expense, and other intangible assets; and
(iii) all Investments other than Permitted Investments.
"Construction Supervisor" means ▇▇▇▇▇ & ▇'▇▇▇▇▇, Inc., as construction
supervisor of the Capital Improvement Program or any successor construction
supervisor appointed pursuant to the Disbursement Agreement.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Debt" means, with respect to any Person, without duplication (i) all
liabilities, contingent or otherwise, of such Person (a) for borrowed money
(whether or not the recourse of the lender is to the whole of the assets of such
Person or only to a portion thereof), (b) evidenced by bonds, notes, debentures,
or similar instruments or letters of credit, (c) representing the deferred and
unpaid balance of the purchase price of any property acquired by such Person or
services received by such Person, other than long-term service contracts or
supply contracts which require minimum periodic payments and other than any such
balance that represents an account payable or other monetary obligation to a
trade creditor created, incurred, assumed or guaranteed by such Person in the
ordinary course of business of such Person in connection with obtaining goods,
materials or services due within twelve months (or such longer period for
payment as is customarily extended by such trade creditor) of the Incurrence
thereof, which account is not overdue by more than 150 days, unless such account
payable is being contested in good faith or has been extended, (d) evidenced by
bankers' acceptances or similar instruments issued or accepted by banks or Swap
Obligations, (e) for the payment of money relating to a Capitalized Lease
Obligation or (f) the Attributable Debt associated with any Sale and Leaseback
Transaction; (ii) reimbursement obligations of such Person with respect to
letters of credit; (iii) all liabilities of others of the kind described in the
preceding clause (i) or (ii) that such Person has guaranteed or that is
otherwise its legal liability (to the extent of such guaranty or other legal
liability) other than for endorsements, with recourse, of negotiable instruments
in the ordinary course of business; (iv) all obligations secured by a Lien
(other than Permitted Liens, except to the extent the obligations secured by
such Permitted Liens are otherwise included in clause (i), (ii) or (iii) of this
definition and are obligations of such Person) to which the property or assets
(including, without limitation, leasehold interests and any other tangible or
intangible property rights) of such Person are subject, regardless of whether
the obligations secured thereby shall have been assumed by or shall otherwise be
such Person's legal liability (but, if such obligations are not assumed by such
Person or are not otherwise such Person's legal liability, the amount of such
Debt shall be deemed to be limited to the fair market value of such property or
assets determined as of the end of the preceding fiscal quarter); and (v) any
and all deferrals, renewals, extensions, refinancings, and refundings (whether
direct or indirect) of, or amendments, modifications, or supplements to, any
liability of the kind described in any of the preceding clauses (i) through (iv)
regardless of whether between or among the same parties.
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"Default" means an event or condition, the occurrence of which is, or
with the lapse of time or giving of notice or both would be, an Event of
Default.
"Definitive Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A, and that do not include the information called for
by footnotes 1 and 2 thereof.
"Delayed Coking Unit" means the delayed coking unit being constructed
as part of the Capital Improvement Program.
"Depository" means the Person specified in Section 2.3 hereof as the
Depository with respect to the Notes issuable in global form, until a successor
shall have been appointed and become such pursuant to the applicable provision
of this Indenture, and, thereafter, "Depository" shall mean or include such
successor.
"Disbursement Agreement" means the Disbursement Agreement, among TEC,
the Company, the disbursement agent named therein and the Construction
Supervisor, as amended pursuant to the terms thereof.
"Disqualified Capital Stock" means, with respect to any Person, any
Capital Stock of such Person or its subsidiaries that, by its terms or by the
terms of any security into which it is convertible or exchangeable, is, or upon
the happening of an event or the passage of time would be, required to be
redeemed or repurchased by such Person or its subsidiaries, including at the
option of the holder, in whole or in part, or has, or upon the happening of an
event or passage of time would have, a redemption or similar payment due, on or
prior to June 30, 2003.
"DTC" means The Depository Trust Company.
"Eligible Institution" means a commercial banking institution that has
combined capital and surplus of not less than $500,000,000 and that is rated "A"
(or higher) according to ▇▇▇▇▇'▇ Investors Service, Inc. or Standard & Poor's
Corporation, Inc. at the time as of which any investment or rollover therein is
made.
"Equipment" means and includes all of the Company's or any of its
Subsidiaries' now owned or hereafter acquired Vehicles, rolling stock and
related equipment and other assets accounted for as equipment by such Person in
its financial statements, all proceeds thereof, and all documents of title,
books, records, ledger cards, files, correspondence and computer files, tapes,
disks and related data processing software that at any time evidence or contain
information relating to the foregoing.
"Equity Offering" of any Person means any Public Equity Offering or any
private placement of any Capital Stock of such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"Event of Default" shall have the meaning specified in Section 6.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC thereunder.
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"Exchange Offer" means the offer that may be made by the Company
pursuant to the Registration Rights Agreement to exchange Series B Notes for
Series A Notes.
"Expense Reimbursement Agreement" means an express reimbursement
agreement pursuant to which the Company will reimburse certain expenses of TEC,
including, without limitation, registration expenses under state and federal
securities laws, franchise taxes, directors' fees and litigation support
expenses.
"GAAP" means generally accepted accounting principles as in effect in
the United States on the Issue Date applied on a basis consistent with that used
in the preparation of the audited financial statements of the Company included
in the Offering Circular.
"Gas Purchase Agreement" means the Interruptible Gas Sales Terms and
Conditions between the Company and TransTexas, as in effect on the Issue Date
and as amended from time to time, provided that any such amendment is not
adverse to the holders of the Notes in any material respect.
"Global Note" means a Note in the form of the Note attached hereto as
Exhibit A and that contains the paragraph referred to in footnote 1 and the
additional schedule referred to in footnote 2.
"Guarantor" means each of the Company's future Subsidiaries that
becomes a guarantor of the Notes and the Company's obligations under this
Indenture in compliance with the provisions of this Indenture.
"Guarantor Senior Debt" means all Debt of a Guarantor created,
incurred, assumed or guaranteed by any Guarantor (and all renewals, extensions,
increases or refundings thereof) (including the principal of, interest on and
fees, premiums, expenses (including costs of collection), indemnities and other
amounts payable in connection with such Debt, and including any
Post-Commencement Amounts), unless the instrument governing such Debt expressly
provides that such Debt is not senior or superior in right of payment to the
Guarantee. Notwithstanding the foregoing, Guarantor Senior Debt does not include
any Debt of the Guarantor to the Company or any Subsidiary or any Unrestricted
Subsidiary.
"HDS Unit" means the hydrodesulfurization unit being constructed as
part of the Capital Improvement Program.
"Holder" means the Person in whose name a Note is registered on the
Registrar's books.
"Hydrocarbons" means oil, natural gas, condensate, and natural gas
liquids.
"Incur" shall have the meaning specified in Section 4.11.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Insurance Proceeds" means the interest in and to all proceeds (net of
costs of collection, including attorney's fees) which now or hereafter may be
paid under any insurance policies now or hereafter obtained by or on behalf of
the Company, TARC, TransTexas, or any Guarantor in connection with any assets
thereof, together with interest payable thereon and the right to collect and
receive the same, including, without limitation, proceeds of casualty insurance,
title insurance, business interruption insurance and any other insurance now or
hereafter maintained with respect to such assets.
8
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"Intercompany Loan Redemption" means the redemption by the Company of
all or a portion of the principal amount then outstanding under the TARC
Intercompany Loan together with all accrued and unpaid interest, if any, to and
including the redemption date.
"Interest Payment Date" means the stated due date of an installment of
interest on the Notes.
"Interest Rate or Currency Agreement" of any Person means any forward
contract, futures contract, swap, option or other financial agreement or
arrangement (including, without limitation, caps, floors, collars, puts and
similar agreements) relating to, or the value of which is dependent upon,
interest rates or currency exchange rates.
"Inventory" means and includes feedstocks, refined products, chemicals
and catalysts, other supplies and storeroom items and similar items accounted
for as inventory by the Company on its financial statements, all proceeds
thereof, and all documents of title, books, records, ledger cards, files,
correspondence, and computer files, tapes, disks and related data processing
software that at any time evidence or contain information relating to the
foregoing.
"Investment" by any Person in any other Person means (a) the
acquisition (whether for cash, property, services, securities or otherwise) of
capital stock, bonds, notes, debentures, partnership, or other ownership
interests or other securities of such other Person or any agreement to make any
such acquisition; (b) the making by such Person of any deposit with, or advance,
loan or other extension of credit to, such other Person (including the purchase
of property from another Person subject to an understanding or agreement,
contingent or otherwise, to resell such property to such other Person) and
(without duplication) any amount committed to be advanced, loaned or extended to
such other Person; (c) the entering into of any guarantee of, or other
contingent obligation with respect to, Debt or other liability of such other
Person; (d) the entering into of any Swap Obligation with such other Person; or
(e) the making of any capital contribution by such Person to such other Person.
"Investment Grade Rating" means, with respect to any Person or issue of
debt securities or preferred stock, a rating in one of the four highest letter
rating categories (without regard to "+" or "-" or other modifiers) by any
rating agency or if any such rating agency has ceased using letter rating
categories or if the four highest of such letter rating categories are not
considered to represent "investment grade" ratings, then the comparable
"investment grade" ratings (as designated by any such rating agency).
"Issue Date" means the date of first issuance of the Notes under this
Indenture.
"Junior Security" means any Qualified Capital Stock and any Debt of the
Company or a Guarantor, as applicable, that is subordinated in right of payment
to the Notes or the Guarantees, as applicable, and has no scheduled installment
of principal due, by redemption, sinking fund payment or otherwise, on or prior
to the Stated Maturity of the Notes.
"Legal Holiday" shall have the meaning provided in Section 13.7.
"Lien" means any mortgage, lien, pledge, charge, security interest, or
other encumbrance of any kind, regardless of whether filed, recorded, or
otherwise perfected under applicable law (including any conditional sale or
other title retention agreement and any lease deemed to constitute a security
interest and any option or other agreement to give any security interest).
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"Liquidated Damages" has the meaning provided in the Registration
Rights Agreement relating to the Notes.
"Material Subsidiary" means any Subsidiary of the Company which, as of
the relevant date of determination, would be a "significant subsidiary" as
defined in Reg. ss. 230.405 promulgated pursuant to the Securities Act as in
effect on the Issue Date, assuming the Company is the "registrant" referred to
in such definition, except that the 10% amounts referred to in such definition
shall be deemed to be 5%.
"Maturity Date," when used with respect to any Note, means the date on
which the principal of such Note becomes due and payable as therein or herein
provided, whether at the Stated Maturity, Change of Control Payment Date,
Purchase Date or by declaration of acceleration, call for redemption or
otherwise.
"Mechanical Completion" means with respect to the Capital Improvement
Program, Phase I, Phase II or any specified unit or component thereof,
sufficient completion of the construction of the Capital Improvement Program,
Phase I, Phase II or any specified unit or component, as the case may be, in
accordance with the Plans, so that the Capital Improvement Program, Phase I,
Phase II or such unit or component, as the case may be, can be operated for its
intended purpose.
"Naphtha Pretreater" means the naphtha pretreater being constructed as
part of the Capital Improvement Program.
"Net Cash Proceeds" means, with respect to any Asset Sale of any
Person, an amount equal to the cash proceeds received (including any cash
proceeds received by way of deferred payment of principal pursuant to a note or
installment receivable or otherwise, but only as and when received, and
excluding any other consideration until such time as such consideration is
converted into cash) therefrom, in each case net of all legal, title and
recording tax expenses, commissions and other fees and expenses incurred, and
all federal, state or local taxes required to be accrued as a liability as a
consequence of such Asset Sale, and in each case net of all Debt secured by such
assets, in accordance with the terms of any Lien upon or with respect to such
assets, or which must, by its terms or in order to obtain a necessary consent to
such Asset Sale to prevent a default or event of default under Senior Debt or by
applicable law, be repaid out of the proceeds from such Asset Sale and that is
actually so repaid.
"Net Debt" of a Person means such Person's outstanding Debt to the
extent recorded in accordance with GAAP, less cash and Cash Equivalents of such
Person, in each case as measured on a consolidated basis and as of the last day
of the measuring period.
"Net Proceeds" means (a) in the case of any sale by a Person of
Qualified Capital Stock, the aggregate net cash proceeds received by such Person
from the sale of Qualified Capital Stock (other than to a Subsidiary) after
payment of reasonable out-of-pocket expenses, commissions and discounts incurred
in connection therewith, and (b) in the case of any exchange, exercise,
conversion or surrender of any outstanding securities or Debt of such Person for
or into shares of Qualified Capital Stock of such Person, the net book value of
such outstanding securities as adjusted on the books of such Person or Debt of
such Person to the extent recorded in accordance with GAAP, in each case, on the
date of such exchange, exercise, conversion or surrender (plus any additional
amount required to be paid by the holder of such Debt or securities to such
Person upon such exchange, exercise, conversion or surrender and less (i) any
and all payments made to the holders of such Debt or securities and (ii) all
other expenses incurred by such Person in connection therewith, in each case,
insofar as such payments or expenses are incident to such exchange, exercise,
conversion, or surrender).
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"Net Working Capital" of any Person means (i) all current assets of
such Person and its consolidated Subsidiaries, minus (ii) all current
liabilities of such Person and its consolidated Subsidiaries other than the
current portion of long term Debt, each item to be determined in conformity with
GAAP.
"Net Worth" of any Person means, at any date of determination,
stockholders' equity as set forth on the most recently available quarterly or
annual consolidated balance sheet of such Person and its Subsidiaries (which
shall be as of a date not more than 105 days prior to the date of such
computation), less any amounts included therein attributable to Disqualified
Capital Stock or any equity security convertible into or exchangeable for Debt,
the cost of treasury stock (not otherwise deducted from stockholder's equity),
and the principal amount of any promissory notes receivable from the sale of the
Capital Stock of such Person or any of its Subsidiaries, each item to be
determined in conformity with GAAP.
"NNM" means the Nasdaq National Market.
"Non-Recourse Debt" of any Accounts Receivable Subsidiary means Debt of
such Accounts Receivable Subsidiary that (a) is not guaranteed by the Company or
any of its Subsidiaries (other than a guaranty by the Company limited in
recourse to the stock of the Accounts Receivable Subsidiary), (b) is not
recourse to and does not obligate the Company or any of its Subsidiaries (other
than as described in clause (a) above), and (c) does not subject any assets of
the Company (other than Capital Stock of such Accounts Receivable Subsidiary) or
any of its Subsidiaries, to the payment thereof.
"Noteholder" means the Person in whose name a Note is registered on the
Registrar's book.
"Note Redemption" means a redemption of Notes by the Company pursuant
to the redemption provisions of this Indenture.
"Note Repurchase" means a purchase of Notes by the Company, other than
pursuant to a Note Redemption or a Change of Control Offer; provided that all
Notes purchased are delivered to the Trustee for cancellation promptly upon
their receipt by the Company.
"Notes" means the 16% Series A Senior Subordinated Notes due 2003 and
the 16% Series B Senior Subordinated Notes due 2003, in each case as
supplemented from time to time in accordance with the terms hereof, issued under
this Indenture.
"NYSE" means the New York Stock Exchange.
"Obligation" means any principal, premium, interest, penalties, fees,
reimbursements, damages, indemnification and other liabilities relating to
obligations of the Company or any Guarantor under the Notes or the Indenture,
including any liquidated damages pursuant to the registration rights agreement
relating to the Notes.
"Offer Price" shall have the meaning specified in Section 4.14.
"Offer to Purchase" means any offer made by the Company to Holders of
the Securities required by Section 4.14."
"Offering Circular" means the offering circular dated as of December
23, 1997 pursuant to which the Notes were offered.
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"Office Leases" means the existing leases of office space at ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
"Officer" means, with respect to the Company, the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the Chief
Financial Officer, the Treasurer, the Controller, or the Secretary of the
Company.
"Officers' Certificate" means, with respect to the Company, a
certificate signed by two Officers or by an Officer and an Assistant Secretary
of the Company and otherwise complying with the requirements of Sections 13.4
and 13.5.
"Old TARC Warrants" means the Common Stock Purchase Warrants of the
Company issued on February 23, 1995.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of Sections
13.4 and 13.5. Unless otherwise required by the Trustee, the counsel may be
outside counsel to the Company.
"Pari Passu Debt" means any other Debt of the Company that specifically
provides that such Indebtedness is to rank pari passu with the Notes in right of
payment.
"Paying Agent" shall have the meaning specified in Section 2.3.
"Permitted Hedging Transactions" means non-speculative transactions in
futures, forwards, swaps or option contracts (including both physical and
financial settlement transactions) engaged in by the TARC Entities as part of
their normal business operations as a risk-management strategy or hedge against
adverse changes in the prices of natural gas, feedstock or refined products;
provided, that at the time of such transaction (i) the counter party to any such
transaction is an Eligible Institution or a Person that has an Investment Grade
Rating or has an issue of debt securities or preferred stock outstanding with an
Investment Grade Rating or (ii) such counter party's obligation pursuant to such
transaction is unconditionally guaranteed in full by, or secured by a letter of
credit issued by, an Eligible Institution or a Person that has an Investment
Grade Rating or that has an issue of debt securities or preferred stock
outstanding with an Investment Grade Rating.
"Permitted Investment" means, when used with reference to the Company
or its Subsidiaries, (i) trade credit extended to persons in the ordinary course
of business; (ii) purchases of Cash Equivalents; (iii) Investments by the
Company or its wholly owned Subsidiaries in wholly owned Subsidiaries of the
Company that are engaged in a Related Business; (iv) Swap Obligations; (v) the
receipt of Capital Stock in lieu of cash in connection with the settlement of
litigation; (vi) advances to officers and employees in connection with the
performance of their duties in the ordinary course of business in an amount not
to exceed $3 million in the aggregate outstanding at any time; (vii) margin
deposits in connection with Permitted Hedging Transactions; (viii) an Investment
in one or more Unrestricted Subsidiaries of the Company in an aggregate amount
not in excess of $10,000,000 (net of returns on investment) plus the assets
comprising the CATOFIN(R) Unit owned by the Company as of the date hereof, less
the amount of any Unrestricted Non-Recourse Debt outstanding of the Company or
any of its Subsidiaries; (ix) deposits permitted by the definition of Permitted
Liens or any extension, renewal, or replacement of any of them, (x) Investments
in Accounts Receivables Notes by TARC in an Accounts Receivable Subsidiary in
amounts not to exceed the greater of $20 million or 20% of the TARC Borrowing
Base at any one time (xi) Investments by the
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Company in a reincorporation subsidiary in connection with the initial
capitalization thereof and not to exceed $1,000, (xii) Investments by the
Company or any of its wholly owned Subsidiaries in an aggregate amount not to
exceed $250,000, for the purpose of facilitating a redemption, repurchase or
other retirement for value of the Old TARC Warrants or the conversion of the Old
TARC Warrants into the right to receive cash, (xiii) a guaranty by a Subsidiary
of the Company permitted under clause (h) of Section 4.111; (xiv) deposits
permitted by of the definition of "Permitted Liens" or any extension, renewal,
or replacement of any of them; (xv) other Investments not in excess of $5
million at any time outstanding, (xvi) loans made (X) to officers, directors and
employees of the Company or any of its Subsidiaries approved by the applicable
Board of Directors (or by an authorized officer), the proceeds of which are used
solely to purchase stock or to exercise stock options received pursuant to an
employee stock option plan or other incentive plan, in a principal amount not to
exceed the purchase price of such stock or the exercise price of such stock
options, as applicable and (Y) to refinance loans, together with accrued
interest thereon made pursuant to this clause, in each case not in excess of $3
million in the aggregate outstanding at any one time and (xvii) money market
mutual or similar funds having assets in excess of $100,000,000.
"Permitted Liens" means (a) Liens imposed by governmental authorities
for taxes, assessments, or other charges not yet due or which are being
contested in good faith and by appropriate proceedings, if adequate reserves
with respect thereto are maintained on the books of the Company or any of its
Subsidiaries in accordance with GAAP; (b) statutory Liens of landlords,
carriers, warehousemen, mechanics, materialmen, repairmen, mineral interest
owners, or other like Liens arising by operation of law in the ordinary course
of business provided that (i) the underlying obligations are not overdue for a
period of more than 60 days, or (ii) such Liens are being contested in good
faith and by appropriate proceedings and adequate reserves with respect thereto
are maintained on the books of the Company or any of its Subsidiaries in
accordance with GAAP; (c) deposits of cash or Cash Equivalents to secure (i) the
performance of bids, trade contracts (other than borrowed money), leases,
statutory obligations, surety bonds, performance bonds, and other obligations of
a like nature incurred in the ordinary course of business (or to secure
reimbursement obligations or letters of credit issued to secure such performance
or other obligations) in an aggregate amount outstanding at any one time not in
excess of $5 million or (ii) appeal or supersedeas bonds (or to secure
reimbursement obligations or letters of credit in support of such bonds); (d)
easements, servitudes, rights-of-way, zoning, similar restrictions and other
similar encumbrances or title defects incurred in the ordinary course of
business which, in the aggregate, are not material in amount and which do not,
in any case, materially detract from the value of the property subject thereto
(as such property is used by any of the TARC Entities) or materially interfere
with the ordinary conduct of the business of any of the TARC Entities including
without limitation, any easement or servitude granted in connection with the
financing of the Storage Assets; (e) Liens arising by operation of law in
connection with judgments, only to the extent, for an amount and for a period
not resulting in an Event of Default with respect thereto; (f) Liens securing
Debt or other obligations not in excess of $3 million; (g) pledges or deposits
made in the ordinary course of business in connection with worker's
compensation, unemployment insurance, other types of social security
legislation, property insurance and liability insurance; (h) Liens on Equipment,
Receivables and Inventory; (i) Liens on the assets of any entity existing at the
time such assets are acquired by any of the TARC Entities, whether by merger,
consolidation, purchase of assets or otherwise so long as such Liens (i) are not
created, incurred or assumed in contemplation of such assets being acquired by
any of the TARC Entities and (ii) do not extend to any other assets of any of
the TARC Entities; (j) Liens (including extensions and renewals thereof) on real
or personal property, acquired after the Issue Date ("New Property"); provided,
however, that (i) such Lien is created solely for the purpose of securing Debt
Incurred to finance the cost (including the cost of improvement or construction)
of the item of New Property subject thereto and such Lien is created at the time
of or within six months after the later of the acquisition, the completion of
construction, or the commencement of full operation of such New Property, (ii)
the principal amount of the Debt secured by such Lien does
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not exceed 100% of such cost plus reasonable financing fees and other associated
reasonable out-of-pocket expenses and (iii) any such Lien shall not extend to or
cover any property or assets other than such item of New Property and any
improvements on such New Property; (k) leases or subleases granted to others
that do not materially interfere with the ordinary course of business of any of
the TARC Entities, taken as a whole; (l) Liens on the assets of one of the TARC
Entities in favor of another TARC Entity; (m) Liens securing reimbursement
obligations with respect to letters of credit that encumber documents relating
to such letters of credit and the products and proceeds thereof; provided, that,
such reimbursement obligations are not matured for a period of over 60 days; (n)
Liens in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods;
(o) Liens encumbering customary initial deposits and margin deposits securing
Swap Obligations or Permitted Hedging Transactions; (p) Liens on cash deposits
to secure reimbursement obligations with respect to letters of credit after the
Delayed Coking Unit is completed; (q) Liens that secure Unrestricted
Non-Recourse Debt; provided, however, that at the time of incurrence the
aggregate fair market value of the assets securing such Lien (exclusive of the
stock of the applicable Unrestricted Subsidiary) shall not exceed the amount of
allowed Unrestricted Non-Recourse Debt of the Company; (r) Liens on the proceeds
of any property subject to a Permitted Lien and Liens on the proceeds of any
Debt Incurred in accordance with the provisions hereof, or on deposit accounts
containing any such proceeds; (s) Liens imposed in connection with Debt incurred
pursuant to clause (f) of Section 4.11; provided, that such liens, if not
Permitted Liens, do not extend to property other than the Storage Assets, the
proceeds of financing related to the Storage Assets or deposit accounts
containing such proceeds; and (t) any extension, renewal or replacement of the
Liens created pursuant to any of clauses (a) through (g), (i) through (s) or (u)
provided that such Liens would have otherwise been permitted under such clauses,
and provided further that the Liens, permitted by this clause (t) do not secure
any additional Debt or encumber any additional property; (u) Liens that secure
Senior Debt; and (v) Liens on any property of the Company (or any agreement to
grant such Liens) securing the Notes.
"Person" means any corporation, individual, joint stock company, joint
venture, partnership, unincorporated association, governmental regulatory
entity, country, state, or political subdivision thereof, trust, municipality,
or other entity.
"Phase I "has the meaning given to it in the Registration Statement on
Form S-4, as amended, of TEC under the heading "Business of TARC--Capital
Improvement Program."
"Phase I Completion Date" means the date on which the Construction
Supervisor issues a written notice (the "Phase I Completion Notice") to the
Company and the Disbursement Agent certifying that (a) the process units and
supporting facilities included in the definition of "Phase I" have reached
Mechanical Completion in accordance with the Plans, and (b) for a period of at
least 15 consecutive days, the Company's refinery has sustained (i) the
successful performance of the Delayed Coking Unit, the HDS Unit and the Sulfur
Recovery System, (ii) an average feedstock throughput level of at least 150,000
barrels per day, and (iii) no net production of vacuum tower bottoms when using
as input a combined feedstock slate with an average API Gravity of 22 degrees or
less.
"Phase II" has the meaning given to it in the Registration Statement on
Form S-4, as amended, of TEC under the heading "Business of TARC--Capital
Improvement Program."
"Phase II Completion Date" means the date on which the Construction
Supervisor issues a written notice (the "Phase II Completion Notice") to the
Company and the Disbursement Agent certifying that (a) the process units and
supporting facilities included in the definition of "Phase II" have reached
Mechanical Completion in accordance with the Plans, and (b) for a period of at
least 72 uninterrupted hours, the
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Company's refinery has sustained (i) the successful performance of all of the
Phase I facilities plus the Fluid Catalytic Cracking (FCC) Unit, the FCC Flue
Gas Scrubber and the Alkylation Unit, (ii) an average feedstock throughput level
of at least 180,000 barrels per day, and (iii) average production yields
(measured as the liquid volume percent of feedstock throughput) of refined
products with a specific gravity of gasoline or lighter of at least 40% and of
middle distillates or lighter of at least 70%, when using a combined Crude Unit
feedstock slate with an average API Gravity of 22 degrees or less.
"Plans" means (a) the plans and specifications prepared by or on behalf
of the Company as used in the Disbursement Agreement, which describe and show
the proposed expansion and modification of the Company's refinery and (b) a
budget prepared by or on behalf of the Company as used in the Disbursement
Agreement.
"Post-Commencement Amounts" means all interest and fees accrued or
accruing after the commencement of any proceeding initiated under any Bankruptcy
Law in accordance with and at the contract rate (including, without limitation,
any non-usurious rate applicable upon default) and all premiums, expenses
(including costs of collection), indemnities and other amounts that would have
accrued or been incurred after the commencement of any such proceeding in any
case as specified in any agreement or instrument creating, evidencing, or
governing any Senior Debt, whether or not, pursuant to applicable law or
otherwise, the claim for such interest, fees, premiums, expenses, indemnities or
other amounts is allowed and non-avoidable as a claim in such proceeding.
"Preferred Stock" means, with respect to any corporation, any class or
classes (however designated) of Capital Stock of such Person that is preferred
as to the payment of dividends, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such corporation over
shares of Capital Stock of any other class of such corporation.
"principal amount" when used with respect to a Note means the principal
amount of such Note as indicated on the face of such Note.
"Property" means any right or interest in or to property or assets of
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Public Equity Offering" means an underwritten public offering by a
nationally recognized member of the National Association of Securities Dealers
of Qualified Capital Stock of any Person pursuant to an effective registration
statement filed with the SEC pursuant to the Securities Act.
"Publicly Traded Stock" means, with respect to any Person, Capital
Stock of such Person that is registered under Section 12 of the Exchange Act and
actively traded on the New York Stock Exchange or American Stock Exchange or
quoted in the National Association of Securities Dealers Automated Quotation
System (National Market System).
"QIB" shall mean "qualified institutional buyer" as defined in Rule
144A.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Rating Agency" means Standard & Poor's Ratings Group (or any successor
thereto) and ▇▇▇▇▇'▇ Investors Service, Inc. (or any successor thereto) or, if
either of them shall have ceased to be a "nationally recognized statistical
rating organization" (as defined in Rule 436 under the Act) or shall have ceased
to make
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publicly available a rating on any outstanding securities of any company engaged
primarily in the oil and gas business, such other organization or organizations,
as the case may be, then making publicly available a rating on the Notes as is
selected by the Company.
"Receivables" means and includes, as to any Person, any and all of such
Person's now owned or hereafter acquired "accounts" as such term is defined in
Article 9 of the Uniform Commercial Code in the State of New York, all products
and proceeds thereof, and all books, records, ledger cards, files,
correspondence, and computer files, tapes, disks or software that at any time
evidence or contain information relating to the foregoing.
"Record Date" means a Record Date specified in the Notes regardless of
whether such Record Date is a Business Day.
"Redemption Date" means, when used with respect to any Note to be
redeemed, the date fixed for such redemption pursuant to this Indenture and
Paragraph 5 in the forms of Note attached hereto as Exhibit A.
"Redemption Price" when used with respect to any Note to be redeemed,
means the redemption price for such redemption pursuant to Paragraph 5 in the
forms of Note attached hereto as Exhibit A which shall include, without
duplication, in each case, accrued and unpaid interest to the Redemption Date.
"Reference Period" with regard to any Person means the four full fiscal
quarters of such Person ended on or immediately preceding any date upon which
any determination is to be made pursuant to the terms of the Notes or this
Indenture.
"Registrar" shall have the meaning specified in Section 2.3.
"Registration Rights Agreements" means the Registration Rights
Agreements in connection with the registration under federal securities laws of
the Notes.
"Related Business" means the business of (i) processing, blending,
terminalling, storing, marketing (other than through operating retail gasoline
stations), refining, or distilling crude oil, condensate, natural gas liquids,
petroleum blendstocks or refined products thereof and (ii) after the Phase II
Completion Date, the exploration for, acquisition of, development of,
production, transportation and gathering of crude oil, natural gas, condensate
and natural gas liquids from outside of the United States and retail marketing
of refined petroleum products.
"Related Person" means (i) any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company or any Subsidiary of the Company or any officer, director, or employee
of the Company or any Subsidiary of the Company or of such Person, (ii) the
spouse, any immediate family member, or any other relative who has the same
principal residence of any Person described in clause (i) above, and any Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with, such spouse, family member, or other relative, and (iii)
any trust in which any Person described in clause (i) or (ii), above, is a
fiduciary or has a beneficial interest. For purposes of this definition the term
"control" means (a) the power to direct the management and policies of a Person,
directly or through one or more intermediaries, whether through the ownership of
voting securities, by contract, or otherwise, or (b) the beneficial ownership of
10% or more of the voting common equity of such
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Person (on a fully diluted basis) or of warrants or other rights to acquire such
equity (whether or not presently exercisable).
"Restricted Investment" means any direct or indirect Investment by the
Company or any Subsidiary of the Company other than a Permitted Investment.
"Restricted Notes" means the Notes required to bear the legends set
forth in Exhibit A hereto.
"Restricted Payment" means, with respect to any Person, (i) any
Restricted Investment, (ii) any dividend or other distribution on shares of
Capital Stock of such Person or any Subsidiary of such Person, (iii) any payment
on account of the purchase, redemption, or other acquisition or retirement for
value of any shares of Capital Stock of such Person, and (iv) any defeasance,
redemption, repurchase, or other acquisition or retirement for value, or any
payment in respect of any amendment in anticipation of or in connection with any
such retirement, acquisition, or defeasance, in whole or in part, of any Pari
Passu Debt or Subordinated Debt, directly or indirectly, of such Person or a
Subsidiary of such Person prior to the scheduled maturity or prior to any
scheduled repayment of principal in respect of such Pari Passu Debt or
Subordinated Debt; provided, however, that the term "Restricted Payment" does
not include (i) any dividend, distribution, or other payment on shares of
Capital Stock of an issuer solely in shares of Qualified Capital Stock of such
issuer that is at least as junior in ranking as the Capital Stock on which such
dividend, distribution, or other payment is to be made, (ii) any dividend,
distribution, or other payment to the Company from any of its Subsidiaries,
(iii) any defeasance, redemption, repurchase, or other acquisition or retirement
for value, in whole or in part, of any Pari Passu Debt or Subordinated Debt of
such Person payable solely in shares of Qualified Capital Stock of such Person,
(iv) any payments or distributions made pursuant to and in accordance with the
Services Agreement, the Expense Reimbursement Agreement, the Office Leases, the
Transfer Agreement or the Tax Allocation Agreement, (v) any redemption,
repurchase or other retirement for value of the Old TARC Warrants by the
Company, including any premium paid thereon, (vi) the redemption, purchase,
retirement or other acquisition of any Debt including any premium paid thereon,
with the proceeds of any refinancing Debt permitted to be incurred pursuant to
clause (o) of the covenant described herein under the heading "Limitation on the
Incurrences of Additional Debt and Issuances of Disqualified Capital Stock,"
(vii) the purchase by the Company of shares of Capital Stock of the Company,
TransTexas or TTXD in connection with each of its employee benefit plans,
including without limitation any employee stock ownership plans or any employee
stock option plans, in an aggregate amount not to exceed 7% of the aggregate
market value of the voting stock held by nonaffiliates of the issuer measured
from the date of the first such purchase, (viii) distributions of common stock
of TransTexas to TEC, and (ix) any dividend or other distribution on the Capital
Stock of any Subsidiary of the Company.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule may
be amended from time to time, or under any similar rule or regulation hereafter
adopted by the Commission.
"Sale and Leaseback Transaction" means an arrangement relating to
property owned on the Issue Date or thereafter acquired whereby the Company or a
Subsidiary of the Company transfers such property to a Person and leases it back
from such Person.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
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"Senior Debt" means, all Debt of the Company, including, without
limitation, the TARC Discount Notes, the TARC Mortgage Notes, the TARC Working
Capital Note and the TARC Intercompany Loan, now or hereafter created, incurred,
assumed or guaranteed by the Company (and all renewals, extensions or refundings
thereof or of any part thereof) (including the principal of, interest on and
fees, premiums, expenses (including costs of collection), indemnities and other
amounts payable in connection with such Indebtedness, and including
Post-Commencement Amounts), unless the instrument governing such Debt expressly
provides that such Debt is not senior or superior in right of payment to the
Notes. Notwithstanding the foregoing, Senior Debt of the Company shall not
include (i) Debt evidenced by the Notes, (ii) Debt of the Company to any
Subsidiary of the Company or to any Unrestricted Subsidiary of the Company, or
(iii) any amounts payable or other Debt to trade creditors created, incurred,
assumed or guaranteed by the Company or any Subsidiary of the Company in the
ordinary course of business in connection with obtaining goods or services..
"Services Agreement" means the Services Agreement among TNGC Holdings
and its Subsidiaries, as in effect on the Issue Date and as amended from time to
time, provided that any such amendment is not materially adverse to the holders
of the Notes.
"Special Record Date" for payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 2.12.
"Stated Maturity," when used with respect to any Note, means June 30,
2003.
"Storage Assets" means the following assets existing or under
construction in or near the Company's refinery: (i) the Prospect Road tank farm
and other tanks; (ii) certain dock improvements; (iii) the dock vapor recovery
system; (iv) the coke handling system; (v) the refinery waste water treatment
facility; (vi) tankage for liquefied petroleum gas and (vii) the assets adjacent
to the refinery purchased on September 19, 1997.
"Subordinated Debt" means Debt of any Person that (i) requires no
payment of principal prior to or on the date on which all principal of and
interest on the Notes is paid in full and (ii) is subordinate and junior in
right of payment to the Notes in the event of a liquidation.
"Subsidiary" with respect to any Person, means (i) a corporation with
respect to which such Person or its Subsidiaries owns, directly or indirectly,
at least fifty percent of such corporation's Capital Stock with voting power,
under ordinary circumstances, to elect directors, or (ii) a partnership in which
such Person or a subsidiary of such Person is, at the time, a general partner of
such partnership and has more than 50% of the total voting power of partnership
interests entitled (without regard to the occurrence of any contingency) to vote
in the election of managers thereof, or (iii) any other Person (other than a
corporation or a partnership) in which such Person, one or more Subsidiaries of
such Person, or such Person and one or more Subsidiaries of such Person,
directly or indirectly, at the date of determination thereof has (x) at least a
fifty percent ownership interest or (y) the power to elect or direct the
election of the directors or other governing body of such other Person;
provided, however, that "Subsidiary" shall not include (i) for the purposes of
the Indenture provisions "Subsidiary Guarantees," and "Limitation on
Transactions with Related Persons" a joint venture an investment in which would
constitute a Permitted Investment, provided that, for purposes of the covenant
described herein under the heading "Limitation on Transactions with Related
Persons," such investment is not with a Related Person other than solely because
the party engaging in such transaction has the ability to control the Related
Person under the definition of "Control" contained within the definition of
Related Person or (ii) any Unrestricted Subsidiary of such Person.
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"Surviving Person" shall have the meaning specified in Section 5.1(a).
"Swap Obligation" of any Person means any Interest Rate or Currency
Agreement entered into with one or more financial institutions or one or more
futures exchanges in the ordinary course of business and not for purposes of
speculation that is designed to protect such Person against fluctuations in (x)
interest rates with respect to Debt Incurred and which shall have a notional
amount no greater than 105% of the principal amount of the Debt being hedged
thereby, or (y) currency exchange rate fluctuations.
"TARC" means TransAmerican Refining Corporation, a Texas corporation,
and any successor corporation pursuant to the terms of the provision described
under Article V.
"TARC Borrowing Base" means, as of any date, an amount equal to the sum
of (a) 90% of the book value of all accounts receivable owned by the Company and
its Subsidiaries (excluding any accounts receivable that are more than 90 days
past due, less (without duplication) the allowance for doubtful accounts
attributable to such current accounts receivable) calculated on a consolidated
basis and in accordance with GAAP and (b) 85% of the current market value of all
inventory owned by the Company and its Subsidiaries as of such date. To the
extent that information is not available as to the amount of accounts receivable
as of a specific date, the Company may utilize, to the extent reasonable, the
most recent available information for purposes of calculating the TARC Borrowing
Base.
"TARC Discount Notes" means the Guaranteed First Mortgage Discount
Notes due 2002 issued by TARC and guaranteed by TEC.
"TARC Entities" means TARC and each of its Subsidiaries.
"TARC Intercompany Loan" means the senior secured promissory note from
the Company to TEC in the fully accreted principal amount of $920,000,000 upon
substantially the terms described in the Registration Statement on Form S-4, as
amended, of TEC under the heading "Description of Existing Indebtedness--TARC
Intercompany Loan."
"TARC Mortgage Notes" means the Guaranteed First Mortgage Notes due
2002 issued by TARC and guaranteed by TEC.
"TARC Working Capital Note" means the promissory note from the Company
to TEC dated as of July 31, 1997.
"Tax Allocation Agreement" means the Tax Allocation Agreement, dated as
of August 24, 1993, among TNGC Holdings Corporation, the Company , TEC and other
subsidiaries of TNGC Holdings Corporation as in effect on the Issue Date and as
amended from time to time, provided that any such amendment is not materially
adverse to the holders of the Notes.
"TEC" means TransAmerican Energy Corporation, a Delaware corporation.
"TEC Indenture" means the indenture, dated as of June 13, 1997, by and
between TEC and Firstar Bank of Minnesota, N.A., as trustee, relating to the TEC
Notes.
"TEC Indenture Trustee" means the trustee under TEC Indenture.
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"TEC Notes" means TEC's 11 1/2% Senior Secured Notes due 2002 and 13%
Senior Secured Discount Notes due 2002, issued pursuant to the TEC Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code ▇▇.▇▇.
77aaa-77bbbb) as in effect on the date of the execution of this Indenture.
"Trading Day" means any day on which the securities in question are
quoted on the NYSE, or if such securities are not approved for listing on the
NYSE, on the principal national securities market or exchange on which such
securities are listed or admitted, or if not listed or admitted for trading on
any national securities market or exchange, on the NNM.
"TransAmerican" means TransAmerican Natural Gas Corporation, a Texas
corporation.
"Transfer Agreement" means the Transfer Agreement, dated as of August
24, 1993, among TransAmerican, TransTexas Transmission Corporation, and ▇▇▇▇ ▇.
▇▇▇▇▇▇▇, as in effect on the Issue Date and as amended from time to time,
provided that any such amendment is not materially adverse to the holders of the
Notes.
"TransTexas" means TransTexas Gas Corporation, a Delaware corporation.
"Trust Officer" means any officer within the corporate trust department
(or any successor group) of the Trustee including any vice president, assistant
vice president, secretary, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the Persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer of
the corporate trust department (or any successor group) of the Trustee to whom
such trust matter is referred because of his knowledge of and familiarity with
the particular subject.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"TTXD" means TransTexas Drilling Services, Inc., a Delaware corporation
or a newly formed corporation which is initially a wholly owned Subsidiary of
TransTexas formed for the purpose of receiving certain drilling assets of
TransTexas.
"Units" means the Units consisting of $175,000,000 aggregate principal
amount of Notes and 2,335,245 Warrants, issued by the Company. Each Unit
consists of one Note in the principal amount of $1000 and one Warrant to
purchase 13.344257 shares of the Company's common stock, par value $.01 per
share.
"Unrestricted Non-Recourse Debt" of the Company or any of its
Subsidiaries means (i) Debt of such Person that is secured solely (other than
with respect to clause (ii) below) by a Lien upon the stock of an Unrestricted
Subsidiary of such Person and as to which there is no recourse (other than with
respect to clause (ii) below) against such Person or any of its assets other
than against such stock (and the dollar amount of any Debt of such Person as
described in this clause (i) shall be deemed to be zero for purposes of all
other provisions of the Indenture) and (ii) guarantees of the Debt of
Unrestricted Subsidiaries of such Person; provided, that the aggregate of all
Debt of such Person Incurred and outstanding pursuant to clause (ii) of this
definition, together with all Permitted Investments (net of any return on such
Investment) in Unrestricted Subsidiaries of such Person, does not exceed 20% of
TARC's Consolidated EBITDA since the Phase II
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Completion Date in the case of TARC plus in the case of clause (ii) of this
definition of Unrestricted Non-Recourse Debt, Restricted Payments permitted to
be made pursuant to Section 4.3.
"Unrestricted Subsidiary" of any Person means any other Person ("Other
Person") that would, but for this definition of "Unrestricted Subsidiary" be a
Subsidiary of such Person organized or acquired after the Issue Date as to which
all of the following conditions apply: (i) neither such Person nor any of its
other Subsidiaries provides credit support of any Debt of such Other Person
(including any undertaking, agreement or instrument evidencing such Debt), other
than Unrestricted Non-Recourse Debt; (ii) such Other Person is not liable,
directly or indirectly, with respect to any Debt other than Unrestricted
Subsidiary Debt; (iii) neither such Person nor any of its Subsidiaries has made
an Investment in such Other Person unless such Investment was permitted by the
provisions described under Section 4.3 and (iv) the Board of Directors of such
Person, as provided below, shall have designated such Other Person to be an
Unrestricted Subsidiary on or prior to the date of organization or acquisition
of such Other Person. Any such designation by the Board of Directors of such
Person shall be evidenced to the Trustee by delivering to the Trustee a
resolution thereof giving effect to such designation and an Officers'
Certificate certifying that such designation complies with the foregoing
conditions. The Board of Directors of any Person may designate any Unrestricted
Subsidiary of such Person as a Subsidiary of such Person; provided, that, (a) if
the Unrestricted Subsidiary has any Debt outstanding or is otherwise liable for
any Debt or has a negative Net Worth, then immediately after giving pro forma
effect to such designation, such Person could incur at least $1.00 of additional
Debt pursuant to the provisions described under Section 4.11 (assuming, for
purposes of this calculation, that each dollar of negative Net Worth is equal to
one dollar of Debt), (b) all Debt of such Unrestricted Subsidiary shall be
deemed to be incurred by a Subsidiary of the Person on the date such
Unrestricted Subsidiary becomes a Subsidiary, and (c) no Default or Event of
Default would occur or be continuing after giving effect to such designation.
Any subsidiary of an Unrestricted Subsidiary shall be an Unrestricted Subsidiary
for purposes of the Indenture.
"Unrestricted Subsidiary Debt" means, as to any Unrestricted Subsidiary
of any Person, Debt of such Unrestricted Subsidiary (i) as to which neither such
Person nor any Subsidiary of such Person is directly or indirectly liable (by
virtue of such Person or any such Subsidiary being the primary obligor on,
guarantor of, or otherwise liable in any respect to, such Debt), unless such
liability constitutes Unrestricted Non-Recourse Debt and (ii) which, upon the
occurrence of a default with respect thereto, does not result in, or permit any
holder (other than the Company or any Subsidiary of the Company) of any Debt of
such Person or any Subsidiary of such Person to declare, a default on such Debt
of such Person or any Subsidiary of such Person or cause the payment thereof to
be accelerated or payable prior to its stated maturity, unless, in the case of
this clause (ii), such Debt constitutes Unrestricted Non-Recourse Debt.
"U.S. Government Obligations" means direct non-callable obligations of,
or non-callable obligations guaranteed by, the United States of America for the
payment of which obligation or guarantee the full faith and credit of the United
States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Value" means, as of any date, the outstanding principal amount of the
Notes, plus all accrued and unpaid interest thereon.
"Vehicles" means all trucks, automobiles, trailers and other vehicles
covered by a certificate of title.
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"Voting Stock" means Capital Stock of a Person having generally the
right to vote in the election of directors of such Person.
"Warrant" means any one of the warrants to purchase shares of Common
Stock issued by the Company pursuant to the Warrant Agreement, other than the
warrants issued by the Company to ▇▇▇▇▇▇▇▇▇ & Company, Inc. pursuant to the
Solicitation Agent Agreement, dated as of December 22, 1997, among the Company,
TEC and ▇▇▇▇▇▇▇▇▇ & Company, Inc.
"Warrant Agent" means First Union National Bank, in its capacity as
Warrant Agent under the Warrant Agreement, and any successor thereto.
"Warrant Agreement" means the Warrant Agreement, dated the Closing
Date, by and between the Company and the Warrant Agent.
Section 1.2 Incorporation by Reference of TIA. Whenever this Indenture
refers to a provision of the TIA, such provision is incorporated by reference in
and made a part of this Indenture. The following TIA terms used in this
Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture securityholder" means a Holder or a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the Notes means the Company and any other obligor on the
Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them thereby.
Section 1.3 Rules of Construction. Unless the context otherwise
requires:
(l) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accor dance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words
in the plural include the singular;
(5) provisions apply to successive events and
transactions;
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(6) "herein," "hereof" and other words of similar import
refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision; and
(7) references to Sections or Articles means reference to
such Section or Article in this Indenture, unless
stated otherwise.
ARTICLE II
THE NOTES
Section 2.1 Form and Dating. Subject to Section 2.15, the Notes and the
Trustee's certificate of authentication, in respect thereof, shall be
substantially in the form of Exhibit A, the terms of which are incorporated in
and made a part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Company and the
Trustee shall approve the form of the Notes and any notation, legend or
endorsement on them. Any such notations, legends or endorsements not contained
in the forms of Note attached as Exhibit A hereto shall be delivered in writing
to the Trustee. Each Note shall be dated the date of its authentication.
The terms and provisions contained in the forms of Note shall
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Company and the Trustee, by their execution and delivery
of this Indenture, expressly agree to such terms and provisions and to be bound
thereby. In the event of any inconsistency between the Notes and this Indenture,
this Indenture controls.
The Notes will be issued (i) in global form (the "Global Note"),
substantially in the form of Exhibit A attached hereto (including the text
referred to in footnotes 1 and 2 thereto) and (ii) in definitive form (the
"Definitive Notes"), substantially in the form of Exhibit A attached hereto
(excluding the text referred to in footnotes 1 and 2 thereto). The Global Note
shall represent the aggregate amount of outstanding Notes from time to time
endorsed thereon; provided, that the aggregate amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of the Global
Note to reflect the amount of any increase or decrease in the amount of
outstanding Notes represented thereby shall be made by the Trustee, in
accordance with instructions given by the Holder thereof as required by Section
2.6 hereof.
Section 2.2 Execution and Authentication. Two Officers shall sign, or
one Officer shall sign and one Officer or any Assistant Secretary shall attest
to, the Notes or the Units, as the case may be, for the Company by manual or
facsimile signature. The Company's seal shall be impressed, affixed, imprinted
or reproduced on the Notes or Units, as the case may be, and may be in facsimile
form.
If an Officer whose signature is on a Note or Unit, as the case may be,
was an Officer at the time of such execution but no longer holds that office at
the time the Trustee authenticates the Note or Unit, as the case may be, the
Note or Unit, as the case may be, shall be valid nevertheless and the Company
shall nevertheless be bound by the terms of the Notes or Units, as the case may
be and this Indenture.
A Note or Warrant, as the case may be, shall not be valid until an
authorized signatory of the Trustee manually signs the certificate of
authentication on the Note or Unit, as the case may be, but such signature
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shall be conclusive evidence that the Note or Unit, as the case may be, has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate Notes or Units, as the case may be, for
original issue in the aggregate principal amount of up to an amount that will
result in proceeds to the Company of $200,000,000, upon a written order of the
Company in the form of an Officers' Certificate. The Officers' Certificate shall
specify the amount of Notes or Units, as the case may be, to be authenticated
and the date on which the Notes or Units, as the case may be, are to be
authenticated. The aggregate principal amount of Notes or Units, as the case may
be, outstanding at any time may not exceed an amount that will result in
proceeds to the Company of $200,000,000, except as provided in Section 2.7. Upon
the written order of the Company in the form of an Officers' Certificate, the
Trustee shall authenticate Notes or Units, as the case may be, in substitution
of Notes or Units, as the case may be, originally issued to reflect any name
change of the Company.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes or Units, as the case may be. Unless otherwise
provided in the appointment, an authenticating agent may authenticate Notes or
Units, as the case may be, whenever the Trustee may do so. Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent to deal with any
Obligor, any Affiliate of any Obligor, or any of their respective Subsidiaries.
Notes shall be issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof.
Section 2.3 Registrar and Paying Agent. The Company shall maintain an
office or agency in the Borough of Manhattan in the City of New York, New York,
where Notes may be presented for registration of transfer or for exchange
("Registrar") and an office or agency in the Borough of Manhattan in the City of
New York, New York, where Notes may be presented for payment ("Paying Agent").
Notices and demands to or upon the Company in respect of the Notes may be served
as is provided in Section 13.2. The Company or any Affiliate of the Company may
act as Registrar or Paying Agent, except that, for the purposes of Articles III,
VIII and XI and Sections 4.14 and 4.16, neither the Company nor any Affiliate of
the Company shall act as Paying Agent. The Registrar shall keep a register of
the Notes and of their transfer and exchange. 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 hereby initially appoints the
Trustee as Registrar and Paying Agent, and the Trustee hereby initially agrees
so to act.
The Company shall enter into an appropriate written agency agreement
with any Agent not a party to this Indenture, which agreement shall implement
the provisions of this Indenture that relate to such Agent. The Company shall
notify the Trustee in writing in advance of the name and address of any such
Agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee
shall act as such.
The Company initially appoints DTC to act as Depository with respect to
the Global Notes. The Trustee shall act as custodian for the Depository with
respect to the Global Notes.
Section 2.4 Paying Agent to Hold Assets in Trust. The Company shall
require each Paying Agent other than the Trustee to agree in writing that each
Paying Agent shall hold in trust for the benefit of Holders or the Trustee all
assets held by the Paying Agent for the payment of principal of, or interest on,
the Notes (whether such assets have been distributed to it by the Company or any
other obligor on the Notes), and shall notify the Trustee in writing of any
Default in making any such payment. If the Company or any Affiliate
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of the Company acts as Paying Agent, it shall segregate such assets and hold
them as a separate trust fund for the benefit of the Holders or the Trustee. The
Company at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed and the Trustee may at
any time during the continuance of any payment Default, upon written request to
a Paying Agent, require such Paying Agent to distribute all assets held by it to
the Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent (if other than the Company, or any Affiliate of
the Company) shall have no further liability for such assets.
Section 2.5 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 Holders. If the Trustee is not the Registrar, the Company
shall furnish to the Trustee on or before the third Business Day preceding 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 reasonably may
require of the names and addresses of Holders.
Section 2.6 Transfer and Exchange.
(a) Transfer and Exchange of Definitive Notes. When Definitive Notes
are presented by a Holder to the Registrar with a request (1) to register the
transfer of the Definitive Notes or (2) to exchange such Definitive Notes for an
equal principal amount of Definitive Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, that the Definitive
Notes so presented (A) have been duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by his attorney, duly authorized in writing; and (B) in the case
of a Restricted Note, such request shall be accompanied by the following
additional documents:
(i) if such Restricted Note is being delivered to the
Registrar by a Holder for registration in the name of such Holder,
without trans fer, a certification to that effect (in substantially the
form of Exhibit C attached hereto); or
(ii) if such Restricted Note is being transferred to a QIB in
accordance with Rule 144A or pursuant to an effective registration
statement under the Securities Act, a certification to that effect (in
substantially the form of Exhibit C attached hereto); or
(iii) if such Restricted Note is being transferred in reliance
on another exemption from the registration requirements of the
Securities Act, a certification to that effect (in substantially the
form of Exhibit C attached hereto) and an opinion of counsel reasonably
acceptable to the Company and the Registrar to the effect that such
transfer is in compliance with the Securities Act.
(b) Transfer of a Definitive Note for a Beneficial Interest in a Global
Note. A Definitive Note may be exchanged for a beneficial interest in a Global
Note only upon receipt by the Trustee of a Definitive Note, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory to the
Trustee, together with:
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(i) written instructions directing the Trustee to make an
endorsement on the Global Note to reflect an increase in the aggregate
principal amount of the Notes represented by the Global Note, and
(ii) if such Definitive Note is a Restricted Note, a
certification (in substantially the form of Exhibit C attached hereto)
to the effect that such Definitive Note is being transferred to a QIB
in accordance with Rule 144A;
in which case the Trustee shall cancel such Definitive Note and cause the
aggregate principal amount of Notes represented by the Global Note to be
increased accordingly. If no Global Note is then outstanding, the Company shall
issue and the Trustee shall authenticate a new Global Note in the appropriate
principal amount.
(c) Transfer and Exchange of Global Notes. The transfer and exchange of
Global Notes or beneficial interests therein shall be effected through the
Depository in accordance with this Indenture and the procedures of the
Depository therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act.
(d) Transfer of a Beneficial Interest in a Global Note for a Definitive
Note. Upon receipt by the Trustee of written transfer instructions (or such
other form of instructions as is customary for the Depository), from the
Depository (or its nominee) on behalf of any Person having a beneficial interest
in a Global Note, the Trustee shall, in accordance with the standing
instructions and procedures existing between the Depository and the Trustee,
cause the aggregate principal amount of Global Notes to be reduced accordingly
and, following such reduction, the Company shall execute and the Trustee shall
authenticate and make available for delivery to the transferee a Definitive Note
in the appropriate principal amount; provided, that in the case of a Restricted
Note, such instructions shall be accompanied by the following additional
documents:
(i) if such beneficial interest is being transferred to the
Person designated by the Depository as being the beneficial owner, a
certification to that effect (in substantially the form of Exhibit C
attached hereto); or
(ii) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A or pursuant to an effective
registration statement under the Securities Act, a certification to
that effect (in substantially the form of Exhibit C attached hereto);
or
(iii) if such beneficial interest is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act, a certification to that effect (in substantially the
form of Exhibit C attached hereto) and, if the Trustee deems it
appropriate, an opinion of counsel reasonably acceptable to the Company
and to the Registrar to the effect that such transfer is in compliance
with the Securities Act.
Definitive Notes issued in exchange for a beneficial interest in a
Global Note shall be registered in such names and in such authorized
denominations as the Depository shall instruct the Trustee.
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(e) Transfer and Exchange of Global Notes. Notwithstanding any other
provision of this Indenture, the Global Note may not be transferred as a whole
except by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee of such
successor Depository; provided, that if:
(i) the Depository notifies the Company that the Depository
is unwilling or unable to continue as Depository and a successor
Depository is not appointed by the Company within 90 days after
delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Trustee
in writing that it elects to cause the issuance of Definitive Notes
under this Indenture,
then the Company shall execute and the Trustee shall authenticate and make
available for delivery, Definitive Notes in an aggregate principal amount equal
to the aggregate principal amount of the Global Note in exchange for such Global
Note.
(f) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in the Global Note have either been exchanged for
Definitive Notes, redeemed, repurchased or cancelled, the Global Note shall be
returned to or retained and cancelled by the Trustee. At any time prior to such
cancellation, if any beneficial interest in the Global Note is exchanged for
Definitive Notes, redeemed, repurchased or cancelled, the aggregate principal
amount of Notes represented by such Global Note shall be reduced accordingly and
an endorsement shall be made on such Global Note by the Trustee to reflect such
reduction.
(g) General Provisions Relating to Transfers and Exchanges of Notes. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Definitive Notes and Global Notes at the
Registrar's request. All Definitive Notes and Global Notes issued upon any
registration of transfer or exchange of Definitive Notes or Global Notes shall
be legal, valid and binding obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Definitive
Notes or Global Notes surrendered upon such registration of transfer or
exchange.
No service charge shall be made to a Holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchange (without transfer to another person) pursuant to Sections
2.10, 3.1, 4.14, 4.21, 4.24, Article XI and 9.5 of this Indenture).
The Company shall not be required to (i) issue, register the transfer
of or exchange Notes during a period beginning at the opening of business 15
days before the day of any selection of Notes for redemption under Section 3.2
hereof and ending at the close of business on the day of selection; or (ii)
register the transfer of or exchange any Note so selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed in
part; or (iii) register the transfer of or exchange a Note between a record date
and the next succeeding interest payment date.
Prior to due presentment for the registration of a transfer of any
Note, the Trustee, any Agent and the Company may deem and treat the Person in
whose name any Note is registered as the absolute owner of
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such Note for all purposes, and neither the Trustee, any Agent nor the Company
shall be affected by notice to the contrary.
(h) Exchange of Series A Notes for Series B Notes. The Series A Notes
may be exchanged for Series B Notes pursuant to the terms of the Exchange Offer.
The Trustee and Registrar shall make the exchange as follows:
The Company shall present the Trustee with an Officers' Certificate
certifying the following:
(A) upon issuance of the Series B Notes, the transactions
contemplated by the Exchange Offer have been consummated; and
(B) the principal amount of Series A Notes properly tendered in
the Exchange Offer that are represented by a Global Note and
the principal amount of Series A Notes properly tendered in
the Exchange Offer that are represented by Definitive Notes,
the name of each Holder of such Definitive Notes, the
principal amount at maturity properly tendered in the Exchange
Offer by each such Holder and the name and address to which
Definitive Notes for Series B Notes shall be registered and
sent for each such Holder.
The Trustee, upon receipt of (i) such Officers' Certificate and (ii) an
Opinion of Counsel (x) to the effect that the Series B Notes have been
registered under Section 5 of the Securities Act and this Indenture has been
qualified under the TIA and (y) with respect to the matters set forth in Section
6 of the Registration Rights Agreement, shall authenticate (A) a Global Note for
Series B Notes in an aggregate principal amount equal to the aggregate principal
amount of Series A Notes represented by a Global Note indicated in such
Officers' Certificate as having been properly tendered and (B) Definitive Notes
representing Series B Notes registered in the names of, and in the principal
amounts indicated in such Officers' Certificate.
If the principal amount at maturity of the Global Note for the Series B
Notes is less than the principal amount at maturity of the Global Note for the
Series A Notes, the Trustee shall make an endorsement on such Global Note for
Series A Notes indicating a reduction in the principal amount at maturity
represented thereby.
The Trustee shall deliver such Definitive Notes for Series B Notes to
the Holders thereof as indicated in such Officers' Certificate.
Section 2.7 Replacement Notes. If a mutilated Note is surrendered to
the Trustee or if the Holder of a Note claims and submits an affidavit or other
evidence, satisfactory to the Company and Trustee, to the Trustee to the effect
that the Note has been lost, destroyed or wrongfully taken, the Company shall
issue and the Trustee shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, such Holder
must provide an indemnity bond or other indemnity, sufficient in the judgment of
both the Company and the Trustee, to protect the Company, the Trustee or any
Agent from any loss which any of them may suffer if a Note is replaced. The
Company and the Trustee may charge such Holder for its reasonable, out-of-pocket
expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company.
Section 2.8 Outstanding Notes. Notes outstanding at any time are all
the Notes that have been authenticated by the Trustee except those cancelled by
it, those delivered to it for cancellation, those
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reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section 2.8
as not outstanding. A Note does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Note, except as provided in Section
2.9.
If a Note is replaced pursuant to Section 2.7 (other than a mutilated
Note surrendered for replacement), it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Note is held by a
bona fide purchaser. A mutilated Note ceases to be outstanding upon surrender of
such Note and replacement thereof pursuant to Section 2.7.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Company or an Affiliate of the Company) holds U.S. Legal Tender or U.S.
Government Obligations sufficient to pay all of the principal and interest due
on the Notes payable on that date, then on and after that date such Notes cease
to be outstanding and interest on them ceases to accrue.
Section 2.9 Treasury Notes. In determining whether the Holders of the
required Value of Notes have concurred in any direction, amendment, supplement,
waiver or consent, Notes owned by the Company and Affiliates of the Company
shall be disregarded, except that, for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, amendment,
supplement, waiver or consent, only Notes that the Trustee knows or has reason
to know are so owned shall be disregarded.
Section 2.10 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 reasonably and in good faith considers
appropriate for temporary Notes. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive Notes in exchange for
temporary Notes. Until so exchanged, the temporary Notes shall in all respects
be entitled to the same benefits under this Indenture as permanent Notes
authenticated and delivered hereunder.
Section 2.11 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 surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent (other than the Company or any Affiliate of the Company, and no one else,
shall cancel and, at the written direction of the Company, shall dispose of all
Notes surrendered for transfer, exchange, payment or cancellation. Subject to
Section 2.7, the Company may not issue new Notes to replace Notes it has paid or
delivered to the Trustee for cancellation. No Notes shall be authenticated in
lieu of or in exchange for any Notes cancelled as provided in this Section 2.11,
except as expressly permitted in the forms of Note and as permitted by this
Indenture.
Section 2.12 Defaulted Interest. Interest on any outstanding 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 that Note (or one or more
predecessor Notes) is registered at the close of business on the Record Date for
such interest.
Any interest on any outstanding Note which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date plus, to the
extent lawful, any interest payable on the defaulted interest (herein called
"Defaulted Interest") shall forthwith cease to be payable to the registered
holder on the relevant Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
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(1) 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 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 of the proposed payment, 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
provided in this clause (1). Thereupon the Trustee shall fix a 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 date of the proposed payment 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
therefor to be mailed, first-class postage prepaid, to each Holder at his
address set forth upon the registry books of the Company on the 10th day prior
to such Special Record Date. The Trustee may, in its discretion, in the name and
at the expense of the Company, cause a similar notice to be published at least
once in a newspaper, customarily published in the English language on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, but such publication shall not be a condition precedent to the
establishment of such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the persons in whose
names the Notes (or their respective predecessor Notes) are registered on such
Special Record Date and shall no longer be payable pursuant to the following
clause (2).
(2) 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 given by the Company to the Trustee of the
proposed payment pursuant to this clause accompanied by an Opinion of Counsel
stating that the manner of payment complies with this clause, such manner shall
be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Note
delivered under this Indenture upon 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 2.13 Computation of Interest. Interest on the Notes will be
computed on the basis of a 360- day year consisting of twelve 30-day months.
Section 2.14 Legends.
(a) Except as permitted by subsections (b) or (c) hereof, each Note
shall bear legends relating to restrictions on transfer pursuant to the
securities laws in substantially the form set forth on Exhibit A or Exhibit B
attached hereto, as applicable.
(b) Upon any sale or transfer of a Restricted Note (including any
Restricted Note represented by a Global Note) pursuant to Rule 144 under the
Securities Act or pursuant to an effective registration statement under the
Securities Act:
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(i) in the case of any Restricted Note that is a
Definitive Note, the Registrar shall permit the Holder
thereof to exchange such Restrict ed Note for a Definitive
Note that does not bear the legends required by subsection
(a) above; and
(ii) in the case of any Restricted Note represented
by a Global Note, such Restricted Note shall not be required
to bear the legends required by subsection (a) above, but
shall continue to be subject to the provisions of Section
2.6(c) or (k), as applicable, hereof; provided, that with
respect to any request for an exchange of a Restricted Note
that is represented by a Global Note for a Definitive Note
that does not bear the legends required by subsection (a)
above, which request is made in reliance upon Rule 144, the
Holder thereof shall certify in writing to the Registrar that
such request is being made pursuant to Rule 144.
(c) The Company shall issue and the Trustee shall authenticate Series B
Notes in exchange for Series A Notes accepted for exchange in the Exchange
Offer. The Series B Notes shall not bear the legends required by subsection (a)
above unless the Holder of such Series B Notes is either (A) a broker-dealer who
purchased such Series B Notes directly from the Company to resell pursuant to
Rule 144A or any other available exemption under the Securities Act, (B) a
Person participating in the distribution of the Series B Notes or Series B or
(C) a Person who is an affiliate (as defined in Rule 144A) of the Company.
Section 2.15 Separation of Notes and Warrants. The Notes and
the Warrants that comprise the Units shall not be separately transferable until
the earlier of (i) one year from the date hereof, (ii) commencement of the
Exchange Offer and (iii) such other date as may be determined by ▇▇▇▇▇▇▇▇▇ &
Company, Inc.
The Units and the beneficial interest in the Notes and the Warrants
that comprise the Units shall be evidenced only by one or more certificates in
substantially the form of Exhibit B hereto, the terms of which are incorporated
in and made a part of this Indenture. The terms of the Warrants are governed by
the Warrant Agreement and are subject to the terms and provisions contained
therein. If any Units are presented for registration of transfer or exchange in
accordance with the terms of this Indenture and the Warrant Agreement, or if the
Warrants evidenced thereby are exercised, the Company shall cause the Trustee,
the Registrar or the Warrant Agent, as appropriate, to issue certificates
evidencing the Notes and the Warrants (to the extent unexercised) in lieu of
such Units. In accordance with the Warrant Agreement, fractional Warrants will
not be issued upon separation of the Notes and Warrants, but in lieu thereof, a
cash adjustment will be paid.
The provisions of Section 2.1 through 2.14, to the extent applicable to
the Notes, shall also apply to the Notes evidenced by any Units.
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ARTICLE III
REDEMPTION
Section 3.1 Right of Redemption. Redemption of Notes, as permitted or
required by any provision of this Indenture, shall be made in accordance with
such provision and this Article III. The Company may redeem at its election, at
any time on or after the Issue Date, any or all of the Notes in cash at the
applicable Redemption Prices specified in Paragraph 5 of the forms of Note
attached as Exhibit A hereto, set forth therein under the caption "Optional
Redemption," including accrued and unpaid interest, if any, to the Redemption
Date.
Section 3.2 Notices to Trustee. If the Company elects to redeem Notes
pursuant to Paragraph 5 of the Notes, it shall notify the Trustee in writing of
the Redemption Date and the principal amount of Notes to be redeemed and whether
it wants the Trustee to give notice of redemption to the Holders.
The Company shall give each notice to the Trustee provided for in this
Section 3.2 at least 30 days before the Redemption Date (unless a shorter notice
shall be satisfactory to the Trustee).
Section 3.3 Selection of Notes to Be Redeemed. If less than all of the
Notes are to be redeemed pursuant to Paragraph 5 thereof, the Trustee shall
select the Notes to be redeemed pro rata, by lot or in such other manner as in
its sole discretion it deems appropriate and fair, and in such manner as
complies with any applicable legal and stock exchange requirements.
The Trustee shall make the selection from the Notes outstanding and not
previously called for redemption and shall promptly notify the Company in
writing of the Notes selected for redemption and, in the case of any Note
selected for partial redemption, the principal amount thereof to be redeemed.
Notes in denominations of $1,000 may be redeemed only in whole. The Trustee may
select for redemption portions (equal to $1,000 or any integral multiple
thereof) of the principal of Notes that have denominations larger than $1,000.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.4 Notice of Redemption. At least 15 days but not more than 60
days before a Redemption Date, the Company shall mail a notice of redemption by
first class mail, postage prepaid, to the Trustee and each Holder whose Notes
are to be redeemed. At the Company's request, the Trustee shall give the notice
of redemption in the Company's name and at the Company's expense. The date fixed
for redemption contained in any notice of redemption and the obligation of the
Company to redeem any Notes upon such date may be subject to the satisfaction or
waiver of conditions determined by the Company in its sole discretion. Each
notice for redemption shall identify the Notes to be redeemed and shall state
the following and such other matters as the Trustee shall deem proper:
(1) the Redemption Date;
(2) the Redemption Price, including the amount of accrued
and unpaid interest to be paid upon such redemption;
(3) the name, address and telephone number of
the Paying Agent;
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(4) that Notes called for redemption must be surrendered
to the Paying Agent at the address specified in such
notice to collect the Redemption Price;
(5) that, unless the Company defaults in its obligation
to deposit U.S. Legal Tender with the Paying Agent in
accordance with Section 3.6, interest on Notes called
for redemption ceases to accrue and/or the original
issue discount ceases to accrete on Notes called for
redemption on and after the Redemption Date and the
only remaining right of the Holders of such Notes is
to receive payment of the Redemption Price, including
accrued and unpaid interest, upon surrender to the
Paying Agent of the Notes called for redemption and
to be redeemed;
(6) if any Note is being redeemed in part, the portion of
the principal amount, equal to $1,000 or any integral
multiple thereof, of such Note that will not be
redeemed and that, after the Redemption Date, and
upon surrender of such Note, a new Note or Notes in
aggregate principal amount equal to the unredeemed
portion thereof will be issued;
(7) if less than all the 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 such Notes to be redeemed and the
aggregate principal amount of Notes to be outstanding
after such partial redemption;
(8) the CUSIP number of the Notes to be redeemed; and
(9) that the notice is being sent pursuant to
this Section 3.4 and pursuant to the re
demption provisions of Paragraph 5 of the
Notes.
Section 3.5 Effect of Notice of Redemption. Once notice of redemption
is mailed in accordance with Section 3.4, Notes called for redemption become due
and payable on the Redemption Date and at the Redemption Price, including
accrued and unpaid interest; provided, however, that the date fixed for
redemption contained in any notice of redemption and the obligation of the
Company to redeem any Notes upon such date may be subject to the satisfaction or
waiver of conditions determined by the Company in its sole discretion. Upon
surrender to the Trustee or Paying Agent, such Notes called for redemption shall
be paid at the Redemption Price, including interest, if any, accrued and unpaid
on the Redemption Date; provided that if the Redemption Date is after a regular
Record Date and on or prior to the Interest Payment Date, the accrued interest
through the date of redemption shall be payable to the Holder of the redeemed
Notes registered on the relevant Record Date; and provided, further, that if a
Redemption Date is a Legal Holiday, payment shall be made on the next succeeding
Business Day and no interest shall accrue for the period from such Redemption
Date to such succeeding Business Day.
Upon compliance by the Company with the provisions of this Article III,
including but not limited to Section 3.6, and upon satisfaction or waiver of any
conditions precedent to the Company's obligation to effect such redemption
contained in the related notice of redemption, interest on the Notes called for
redemption will cease to accrue, and/or the original issue discount will cease
to accrete on the Notes called for redemption, on and after the Redemption Date,
regardless of whether such Notes are presented for payment.
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Section 3.6 Deposit of Redemption Price. On or prior to the Redemption
Date, the Company shall deposit with the Paying Agent (other than the Company or
an Affiliate of the Company) U.S. Legal Tender sufficient to pay the Redemption
Price of, including accrued and unpaid interest on, all Notes to be redeemed on
such Redemption Date (other than Notes or portions thereof called for redemption
on that date that have been delivered by the Company to the Trustee for
cancellation). The Paying Agent shall promptly return to the Company any U.S.
Legal Tender so deposited which is not required for that purpose upon the
written request of the Company.
If the Company complies with the preceding paragraph and the other
provisions of this Article III, interest on the Notes to be redeemed will cease
to accrue on the applicable Redemption Date, and/or the original issue discount
will cease to accrete on the Notes to be redeemed on the applicable Redemption
Date, regardless of whether such Notes are presented for payment.
Notwithstanding anything herein to the contrary, if any Note surrendered for
redemption in the manner provided in the Notes shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall continue to accrue and be paid from the
Redemption Date until such payment is made on the unpaid principal and, to the
extent lawful, on any interest not paid on such unpaid principal, in each case
at the rate and in the manner provided in Section 4.1 and the Note.
Section 3.7 Notes Redeemed in Part. Upon surrender of a Note that is to
be redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder, without service charge, a new Note or
Notes equal in principal amount to the unredeemed portion of the Note
surrendered.
ARTICLE IV
COVENANTS
Section 4.1 Payment of Notes. The Company shall pay the principal of
and interest on the outstanding Notes on the dates and in the manner provided in
the Notes to the Trustee at its New York agent's office unless otherwise
instructed in writing by the Trustee. An installment of principal of or interest
on the Notes shall be considered paid on the date it is due if the Trustee or
Paying Agent (other than the Company or an Affiliate of the Company) holds for
the benefit of the Holders, on or before 11:00 a.m. Houston, Texas time on that
date, U.S. Legal Tender deposited and designated for and sufficient to pay the
installment. The Company shall pay any and all amounts, including without
limitation, Liquidated Damages, if any, on the dates and in the manner required
under the Registration Rights Agreement.
The Company shall pay interest on overdue principal and on overdue
installments of interest at the rate specified in the Notes compounded
semi-annually, to the extent lawful.
Notwithstanding anything to the contrary contained in this Indenture,
the Company or the Trustee may, to the extent required by law, deduct or
withhold income or other similar taxes imposed by the United States of America
from principal, premium or interest payments on the Notes.
Section 4.2 Maintenance of Office or Agency. The Company shall maintain
in the Borough of Manhattan in the City of New York, New York, an office or
agency where Notes may be presented or surrendered for payment, where 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 Company shall give prior written notice to the Trustee of the
location, and any change in the location, of such
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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 address of the Trustee set forth in Section 13.2.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; 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 Borough of
Manhattan in the City of New York, New York, for such purposes. The Company
shall give prior written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby initially designates the corporate trust office of the
Trustee in the Borough of Manhattan in the City of New York, New York, as such
office of the Company.
Section 4.3 Limitation on Restricted Payments. The Company shall not,
and shall not permit any of its Subsidiaries to, directly or indirectly, make
any dividend or other distribution on shares of Capital Stock of the Company or
any Subsidiary of the Company or make any payment on account of the purchase,
redemption, or other acquisition or retirement for value of any such shares of
Capital Stock unless such dividends, distributions, or payments are made in cash
or Capital Stock or a combination thereof. In addition, the Company shall not,
and shall not permit any of its Subsidiaries to, directly or indirectly, make
any Restricted Payment; provided, however, that the Company may make a
Restricted Payment if, at the time or after giving effect thereto on a pro forma
basis no Default or Event of Default would occur or be continuing, and:
(a) the Company's Consolidated Fixed Charge Coverage
Ratio exceeds 2.25 to 1; and
(b) the aggregate amount of all Restricted Payments made by
all of the TARC Entities, including such proposed Restricted Payment and all
payments that may be made pursuant to the proviso at the end of this sentence
(if not made in cash, then the fair market value of any property used therefor),
from and after the Issue Date and on or prior to the date of such Restricted
Payment, would not exceed an amount equal to (x) 50% of Adjusted Consolidated
Net Income of the Company accrued for the period (taken as one accounting
period) from the first full fiscal quarter that commenced after the Issue Date
to and including the fiscal quarter ended immediately prior to the date of each
calculation for which financial statements are available (or, if the Company's
Adjusted Consolidated Net Income for such period is a deficit, then minus 100%
of such deficit), plus (y) the aggregate Net Proceeds received by the Company
from the issuance or sale (other than to a Subsidiary of the Company) of its
Qualified Capital Stock from and after the Issue Date and on or prior to the
date of such Restricted Payment, minus (z) 100% of the amount of any
write-downs, write-offs, other negative revaluations, and other negative
extraordinary charges not otherwise reflected in the Company's Adjusted
Consolidated Net Income during such period; and
provided, that nothing in this Section 4.3 shall prohibit the payment
of any dividend within 60 days after the date of its declaration if such
dividend could have been made on the date of its declaration in compliance with
the foregoing provisions.
Section 4.4 Corporate Existence. Subject to Article V, the Company
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate or other existence of
each of its Subsidiaries in accordance with the respective organizational
documents of each of them and the rights (charter and statutory) and corporate
franchises of the Company and each of its Subsidiaries; provided, however, that
the Company shall not be required to preserve, with respect to itself,
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any right or franchise, and with respect to any of its Subsidiaries, any such
existence, right or franchise, if (a) the Board of Directors of the Company
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and (b) the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 4.5 Payment of Taxes and Other Claims. The Company shall, and
shall cause each of its Subsidiaries to, pay or discharge or cause to be paid or
discharged, before the same shall become delinquent all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon the Company or any of its
Subsidiaries or any of their respective properties and assets; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment or charge whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings and for which disputed amounts adequate reserves have been
established in accordance with GAAP.
Section 4.6 Maintenance of Properties and Insurance.
(a) Each of the Company and its Subsidiaries shall cause the properties
used or useful to the conduct of its business and the business of each of its
Subsidiaries to be maintained and kept in good condition, repair and working
order (reasonable wear and tear excepted) and supplied with all necessary
equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in its reasonable
judgment may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times.
(b) Each of the Company and its Subsidiaries shall provide, or shall
cause to be provided, for itself and each of its Subsidiaries, insurance
(including appropriate self-insurance) against loss or damage of the kinds that,
in its reasonable, good faith opinion, are adequate and appropriate for the
conduct of its business and the business of such Subsidiaries in a prudent
manner, with reputable insurers or with the government of the United States of
America or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as is customary, in its reasonable, good faith
opinion, and adequate and appropriate for the conduct of its business and the
business of its Subsidiaries in a prudent manner for companies engaged in a
similar business.
Section 4.7 Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee within 60 days after the
end of each of its fiscal quarters, or 105 days after the end of a fiscal
quarter that is also the end of a fiscal year, an Officers' Certificate
complying with Section 314(a)(4) of the TIA and stating that a review of its
activities and the activities of its Subsidiaries during the preceding fiscal
quarter has been made under the supervision of the signing Officers with a view
to determining whether the Company and its Subsidiaries have kept, observed,
performed and fulfilled its obligations (excluding those obligations addressed
by Section 12.3) under this Indenture and further stating, as to each such
Officer signing such certificate, regardless of whether the signer knows of any
failure by the Company or any Subsidiary of the Company to comply with any
conditions or covenants in this Indenture, or of the occurrence of any Default,
and, if such ▇▇▇▇▇▇ does know of such a failure to comply or Default, the
certificate shall describe such failure or Default with particularity.
(b) The Company shall deliver to the Trustee within 105 days after the
end of each of its fiscal years a written report of a firm of independent
certified public accountants with an established national reputation stating
that in conducting their audit for such fiscal year, nothing has come to their
attention that caused them
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to believe that the Company or any Subsidiary of the Company was not in
compliance with the provisions set forth in Section 4.3, 4.11 or 4.14.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, immediately upon becoming aware of any Default or Event
of Default under this Indenture, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto. The Trustee shall not be deemed to have knowledge of
a Default or an Event of Default unless one of its trust officers receives
notice of the Default giving rise thereto from the Company or any of the
Holders.
(d) The Company shall deliver to the Trustee an Officers' Certificate
specifying any changes in the composition of the Board of Directors of the
Company or any of its Subsidiaries or of any amendment to the charter or bylaws
of the Company or any of its Subsidiaries. The Officers' Certificate shall
include a description in reasonable detail of such amendment or change and an
explanation why such amendment or change does not constitute a Default or Event
of Default.
Section 4.8 SEC Reports. The Company shall deliver to the Trustee and
each Holder, within 15 days after it files the same with the SEC, copies of all
reports and information (or copies of such portions of any of the foregoing as
the SEC may by rules and regulations prescribe), if any, which the Company is
required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange
Act. The Company shall include in all such reports and information a summary of
the status of the Company's Capital Improvement Program, including a description
of sources of funds available for the completion of the Capital Improvements
Program. The Company agrees to continue to be subject to and comply with the
filing and reporting requirements of the Commission as long as any of the Notes
are outstanding.
Concurrently with the reports delivered pursuant to the preceding
paragraph, the Company shall deliver to the Trustee and to each Holder annual
and quarterly financial statements with appropriate footnotes of the Company and
its Subsidiaries, all prepared and presented in a manner substantially
consistent with those of the Company required by the preceding paragraph. The
Company shall also comply with the other provisions of TIA ss. 314(a).
So long as is required for an offer or sale of the Notes to qualify for
an exemption under Rule 144A, the Company shall, upon request, provide the
information required by clause (d)(4) thereunder to each Holder and to each
beneficial owner and prospective purchaser of Notes identified by any Holder of
Restricted Notes.
Section 4.9 Limitation on Status as Investment Company or Public
Utility Company. The Company shall not, and shall not permit any of its
Subsidiaries to, become an "investment company" (as that term is defined in the
Investment Company Act of 1940, as amended), or a "holding company," or "public
utility company" (as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended) or otherwise become subject to regulation under
the Investment Company Act or the Public Utility Holding Company Act.
Section 4.10 Limitation on Transactions with Related Persons.
(a) The Company shall not, and shall not permit any of its Subsidiaries
to, enter directly or indirectly into, or permit to exist, any transaction or
series of related transactions with any Related Person (including, without
limitation: (i) the sale, lease, transfer or other disposition of properties,
assets or
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securities to such Related Person, (ii) the purchase or lease of any property,
assets or securities from such Related Person, (iii) an Investment in such
Related Person (excluding Investments permitted to be made pursuant to clauses
(iii), (vi), (viii), (x), (xi), (xii), and (xvi) of the definition of "Permitted
Investment"), and (iv) entering into or amending any contract or agreement with
or for the benefit of a Related Person (each, a "Related Person Transaction")),
except for (A) permitted Restricted Payments, including for this purpose the
transactions excluded from the definition of Restricted Payments by the proviso
contained in the definition of "Restricted Payments", (B) transactions made in
good faith, the terms of which are (x) fair and reasonable to the Company or
such Subsidiary, as the case may be, and (y) at least as favorable as the terms
which could be obtained by the Company or such Subsidiary, as the case may be,
in a comparable transaction made on an arm's length basis with Persons who are
not Related Persons, (C) transactions between the Company and any of its Wholly
Owned Subsidiaries or transactions between Wholly Owned Subsidiaries of the
Company, (D) transactions pursuant to the Services Agreement, the Transfer
Agreement, the Tax Allocation Agreement, the Gas Purchase Agreement, the Expense
Reimbursement Agreement, the TARC Intercompany Loan and related security
documents, and the Registration Rights Agreement (E) the lease of office space
to the Company or an Affiliate of the Company by TransAmerican or an Affiliate
of TransAmerican, provided that payments thereunder do not exceed in the
aggregate $200,000 per year, (F) any employee compensation arrangement in an
amount which together with the amount of all other cash compensation paid to
such employee by the Company and its Subsidiaries does not provide for cash
compensation in excess of $5,000,000 in any fiscal year of the Company or any
Subsidiary and which has been approved by a majority of the Company's
Independent Directors and found in good faith by such directors to be in the
best interests of the Company or such Subsidiary, as the case may be, (G) loans
to the Company which are permitted to be Incurred pursuant to the terms of
Section 4.11; (H) the amounts payable by the TEC and its Subsidiaries to
Southeast Contractors for employee services provided to the Company not
exceeding the actual costs to Southeast Contractors of the employees, which
costs consist solely of payroll and employee benefits, plus related
administrative costs and an administrative fee, not exceeding $2,000,000 per
year in the aggregate; and (I) the Company and its Subsidiaries may pay a
management fee to TransAmerican in an amount not to exceed $2,500,000 per year.
(b) Without limiting the foregoing, except for sales of accounts
receivable to an Accounts Receivable Subsidiary in accordance with Section 4.20,
(i) with respect to any Related Person Transaction or series of Related Person
Transactions (other than any Related Person Transaction described in clause (A)
(with respect to Permitted Restricted Payments by virtue of clauses (i), (ii),
(iv), (vii), (ix), (x) or (xi) of the proviso contained in the definition of
"Restricted Payments"), (C), (D), (E), or (G) of Section 4.10(a)) with an
aggregate value in excess of $5,000,000, such transaction must first be approved
by a majority of the Board of Directors of the Company or its Subsidiary which
is the transacting party and a majority of the directors of such entity who are
disinterested in the transaction pursuant to a Board Resolution, as (x) fair and
reasonable to the Company or such Subsidiary, as the case may be, and (y) on
terms which are at least as favorable as the terms which could be obtained by
the Company or such Subsidiary, as the case may be, on an arm's length basis
with Persons who are not Related Persons, and (ii) with respect to any Related
Person Transaction or series of related Person Transactions (other than any
Related Person Transaction described in clause (A) (with respect to permitted
Restricted Payments by virtue of clauses (i), (ii), (iv), (vii), (ix), (x) or
(xi) of the proviso contained in the definition of "Restricted Payments") (C),
(D), (E) or (G) of Section 4.10(a)) with an aggregate value in excess of
$10,000,000, the Company must first obtain a favorable written opinion as to the
fairness of such transaction to the Company or such Subsidiary, as the case may
be, from a financial point of view, from a "big 6 accounting firm" or a
nationally recognized investment banking firm; provided that such opinion shall
not be necessary if approval of the Board of Directors to such Related Person
Transaction has been obtained after receipt of bona fide bids of at least two
other independent parties and such Related Person Transaction is in the ordinary
course of business.
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Section 4.11 Limitation on Incurrences of Additional Debt and Issuances
of Disqualified Capital Stock. Except as set forth in this Section 4.11, from
and after the Issue Date, the Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume, guarantee, or
otherwise become liable for, contingently or otherwise (to "Incur" or, as
appropriate, an "Incurrence"), any Debt or issue any Disqualified Capital Stock,
except : (a) Debt evidenced by the Notes and the Guarantees in an aggregate
amount not to exceed $200 million in proceeds to the Company less the aggregate
amount of proceeds to the Company pursuant to Debt incurred under clause (p)
below; (b) Debt evidenced by the TARC Intercompany Loan and any other Debt at
any time owing by any of the TARC Entities to TEC in an aggregate outstanding
principal amount, when added to the then outstanding principal amount of the
TARC Intercompany Loan and any other Debt incurred pursuant to this clause (b)
or pursuant to clause (o) below to replace, extend, renew or refund Debt
incurred pursuant to this clause (b), at any one time outstanding not in excess
of $920 million less any amount repaid pursuant to paragraph (c) (i) of the
covenant described herein under Section 4.14 hereof; (c) Subordinated Debt of
the Company solely to any wholly owned Subsidiary of the Company, or Debt of any
wholly owned Subsidiary of the Company solely to the Company or to any wholly
owned Subsidiary of the Company; (d) Debt of the Company outstanding at any time
in an aggregate principal amount not to exceed the greater of (x) $100 million
or (y) the TARC Borrowing Base, less, in each case, the amount of any Debt of an
Accounts Receivable Subsidiary (other than Debt owed to the Company); (e) Debt
in an aggregate principal amount not to exceed at any one time $50 million; (f)
Debt secured by the Storage Assets in an aggregate amount outstanding at any one
time not to exceed $115 million; (g) Debt secured by a Permitted Lien that meets
the requirements of clause (c), (g), (m), (o) and (r) of the definition of
"Permitted Liens," to the extent that such Liens would give rise to Debt under
clauses (i), (ii), or (iii) of the definition of "Debt;" (h) Any guaranty of
Debt incurred pursuant to clauses (d), (e), (g) or (n) hereof which guaranty
shall not be included in the determination of the amount of Debt which may be
Incurred pursuant to (d), (e), (g) or (n) hereof; (i) Swap Obligations of the
Company; (j) Unrestricted Non-Recourse Debt of the Company; (k) Debt evidenced
by the TARC Mortgage Notes; (l) letters of credit and reimbursement obligations
relating thereto to the extent collateralized by cash or Cash Equivalents; (m)
Debt evidenced by the TARC Discount Notes; (n) Debt of TARC or any of its
Subsidiaries owed to TEC which is loaned pursuant to terms of the fourth
paragraph of either of the covenants contained under the headings "--Excess
Cash" and "--Additional Interest Excess Cash Offer" under the TEC Indenture in
the aggregate not in excess of $50 million; (o) the Company may Incur Debt as an
extension, renewal, replacement, or refunding of any of the Debt permitted to be
Incurred by clauses (b), (p) or (r) hereof, or this clause (o) (such Debt is
collectively referred to as "Refinancing Debt"), provided, that (1) the maximum
principal amount of Refinancing Debt (or, if such Refinancing Debt is issued
with original issue discount, the original issue price of such Refinancing Debt)
permitted under this clause (o) may not exceed the lesser of (x) the principal
amount of the Debt being extended, renewed, replaced, or refunded plus
Refinancing Fees or (y) if such Debt being extended, renewed, replaced, or
refunded was issued at an original issue discount, the original issue price,
plus amortization of the original issue discount as of the time of the
Incurrence of the Refinancing Debt plus Refinancing Fees and (2) the Refinancing
Debt shall rank with respect to the Notes to an extent no less favorable in
respect thereof to the Holders than the Debt being refinanced; (p) Pari Passu
Debt or Subordinated Debt of the Company with initial net proceeds to the
Company not in excess of $25 million in the aggregate less the aggregate amount
of proceeds to the Company pursuant to Debt incurred under clause (a) above
after the Issue Date; (q) Debt secured by Liens permitted pursuant to clauses
(h) and (j) of Permitted Liens, in an aggregate principal amount not to exceed
$35 million; (r) Debt of the Company Incurred in connection with the
acquisition, construction or improvement of a CATOFIN(R) Unit not in excess of
20% of the Company's Consolidated EBITDA accrued for the period (taken as one
accounting period) commencing with the first full fiscal quarter that commenced
after the Phase I Completion Date, to and including the fiscal quarter ended
immediately prior to the date of such calculation, provided, that, no such Debt
may be Incurred unless (i) the Phase II Completion Date has occurred or (ii) the
Construction
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Supervisor shall have provided the Trustee with written certification that,
based upon its bi-monthly evaluation of the Capital Improvement Program, the
amounts remaining in the disbursement accounts to complete Phase II are
sufficient to complete Phase II in accordance with the Plans approved by the
Construction Supervisor, and (s) Debt of the Company owed to TEC that does not
in the aggregate exceed $50 million principal amount outstanding at any one
time.
For the purpose of determining the amount of outstanding Debt that has
been Incurred pursuant to this covenant, there shall be included in each such
case the principal amount then outstanding of any Debt originally Incurred
pursuant to such clause and, after any refinancing or refunding of such Debt,
any outstanding Debt Incurred pursuant to clause (o) above so as to refinance or
refund such Debt Incurred pursuant to such clause and any subsequent
refinancings or refundings thereof.
Notwithstanding the foregoing provisions of this covenant, (a) the
Company may Incur Senior Debt and the Company may issue Disqualified Capital
Stock if, at the time such Senior Debt is Incurred or such Disqualified Capital
Stock is issued, (i) no Default or Event of Default shall have occurred and be
continuing at the time or immediately after giving effect to such transaction on
a pro forma basis, and (ii) immediately after giving effect to the Consolidated
Fixed Charges in respect of such Debt being Incurred or such Disqualified
Capital Stock being issued and the application of the proceeds therefrom to the
extent used to reduce Debt or Disqualified Capital Stock, on a pro forma basis,
the Consolidated Fixed Charge Coverage Ratio of the Company for the Reference
Period is greater than 2.25 to l, and (b) the Company may Incur Subordinated
Debt if, at the time such Subordinated Debt is incurred, (i) no Default or Event
of Default shall have occurred and be continuing at the time or immediately
after giving effect to such transaction on a pro forma basis, and (ii)
immediately after giving effect to the Consolidated Fixed Charges in respect of
such Subordinated Debt being incurred and the application of the proceeds
therefrom to the extent used to reduce Debt, on a pro forma basis, the
Consolidated Fixed Charge Coverage Ratio of the Company for the Reference Period
is greater than 2.0 to I.
Debt Incurred and Disqualified Capital Stock issued by any Person that
is not a Subsidiary of the Company as the case may be, which Debt or
Disqualified Capital Stock is outstanding at the time such Person becomes a
Subsidiary of, or is merged into, or consolidated with the Company or one of its
Subsidiaries, as the case may be, shall be deemed to have been Incurred or
issued, as the case may be, at the time such Person becomes a Subsidiary of, or
is merged into, or consolidated with or one of its Subsidiaries.
For the purpose of determining compliance with this covenant, (A) if an
item of Debt meets the criteria of more than one of the types of Debt described
in the above clauses, the Company or the Subsidiary in question shall have the
right to determine in its sole discretion the category to which such Debt
applies and shall not be required to include the amount and type of such Debt in
more than one of such categories and may elect to apportion such item of Debt
between or among any two or more of such categories otherwise applicable, and
(B) the amount of any Debt which does not pay interest in cash or which was
issued at a discount to face value shall be deemed to be equal to the amount of
the liability in respect thereof determined in accordance with GAAP.
Section 4.12 Limitations on Restricting Subsidiary Dividends. The
Company shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, create, assume, or suffer to exist any consensual encumbrance or
restriction on the ability of any Subsidiary of the Company to pay dividends or
make other distributions on the Capital Stock of any Subsidiary of the Company,
except encumbrances and restrictions existing under this Indenture and any
agreement of a Person acquired by the Company or a Subsidiary of the Company,
which restrictions existed at the time of acquisition, were not put in place in
anticipation of such
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acquisition and are not applicable to any Person or property, other than the
Person or any property of the Person so acquired. Notwithstanding anything
contained herein to the contrary, the Company may not create an encumbrance or
restriction on their ability to pay premium, if any, principal of, or interest
on, the TARC Intercompany Loan.
Section 4.13 Liens. The Company shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, Incur, or suffer to exist any Lien
upon any of its respective property or assets, whether now owned or hereafter
acquired, other than Permitted Liens. For the purpose of determining compliance
with this Section 4.13, if a Lien meets the criteria of more than one of the
types of Permitted Liens, the Company or the Subsidiary in question shall have
the right to determine in its sole discretion the category of Permitted Lien to
which such Lien applies, shall not be required to include such Lien in more than
one of such categories, and may elect to apportion such Lien between or among
any two or more categories otherwise applicable. The Company covenants to grant
to the Trustee on behalf of the Holders a Lien on the assets of the Company
currently subject to a Lien in favor of TEC; provided, that the Company shall
not be required to grant such Lien until the TARC Intercompany Loan has been
paid in full and has not been refinanced, refunded or replaced with the proceeds
of Other Debt ("Other Debt"), which Other Debt has a lower cost of capital to
TARC than the TARC Intercompany Loan and the principal amount of such Other Debt
(or, if such Other Debt is issued with original issue discount, the original
issue amount of such Other Debt) is equal to or less than the original issue
price of, plus amortization of the original issue discount on, the TARC
Intercompany Loan at the time of the incurrence of such Other Debt.
Section 4.14 Limitation on Asset Sales.
(a) The Company shall not, and shall not permit any of its Subsidiaries
to, consummate an Asset Sale unless:
(i) the Company (or its Subsidiaries, as the case may be)
receives consideration at the time of such sale or other disposition at
least equal to the fair market value thereof (as determined in good
faith by the Company's Board of Directors and evidenced by a board
resolution in the case of any Asset Sales or series of related Asset
Sales having a fair market value of $15 million or more);
(ii) at least 85% of the proceeds received by the Company (or
its Subsidiaries, as the case may be) from each such Asset Sale
consists of (A) cash, (B) Cash Equivalents, (C) Publicly Traded Stock
or (D) any combination of the foregoing; provided, however, that (l)
the amount of (x) any liabilities (as shown on the Company's or such
Subsidiary's most recent balance sheet or in the notes thereto) of the
Company or such Subsidiary (other than liabilities that are by their
terms expressly subordinated to the Notes or any guarantee thereof)
that are assumed by the transferee of any such assets and (y) any notes
or other obligations received by the Company or any such Subsidiary
from such transferee that, within 90 days following the closing of such
sale or disposition, are converted by the Company or such Subsidiary
into cash (to the extent of the cash received), shall be deemed to be
cash for purposes of this provision and (2) the aggregate fair market
value (as determined in good faith by the Board of Directors of the
Company, evidenced by a board resolution) of all consideration of the
type specified in clause (C) above received by the Company and its
Subsidiaries from all Asset Sales after the Issue Date shall not exceed
15% of Consolidated Net Tangible Assets at the time of such Asset Sale;
and
(iii) the Net Cash Proceeds received by the Company (or its
Subsidiaries, as the case may be) from such Asset Sales are applied in
accordance with subsection (c) below.
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(b) Notwithstanding the foregoing limitations on Asset Sales and
restrictions on the use of Net Cash Proceeds therefrom:
(A) The Company or any Guarantor may convey, sell, lease,
transfer, or otherwise dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Company or any Guarantor;
(B) the Company and its Subsidiaries may engage in Asset Sales
in the ordinary course of business;
(C) the Company and its Subsidiaries may engage in Asset Sales
not otherwise permitted in clauses (A), (B) or (D) through (K) of this
sentence provided that the aggregate proceeds from all such Asset Sales
do not exceed $10 million in any twelve-month period;
(D) the Company and its Subsidiaries may engage in Asset Sales
pursuant to and in accordance with the provisions described under
Article V hereof;
(E) the Company and its Subsidiaries may sell, assign, lease,
license, transfer, abandon or otherwise dispose of (a) damaged, worn
out, unserviceable or other obsolete property in the ordinary course of
business or (b) other property no longer necessary for the proper
conduct of their business;
(F) The Company and its Subsidiaries may sell accounts
receivable to an Accounts Receivable Subsidiary in accordance with the
provisions described under Section 4.20;
(G) The Company and its Subsidiaries may convey, sell,
transfer or otherwise dispose of crude oil and refined products in the
ordinary course of business;
(H) The Company and its Subsidiaries may engage in Asset Sales
(a) the Net Cash Proceeds of which are used for (i) payment of cash
interest on the Notes or (ii) a one-time payment of cash interest on
the TARC Intercompany Loan, (b) in connection with the settlement of
litigation or the payment of judgments or (c) the Net Cash Proceeds of
which are used in connection with the settlement of litigation or for
the payment of judgments; provided, that the aggregate value of assets
transferred pursuant to clauses (b) and (c) above from and after the
Issue Date does not exceed $25,000,000;
(I) The Company may transfer the Storage Assets in connection
with the financing thereof pursuant to clause (f) of the covenant
described herein under Section 4.11 hereof;
(J) The Company and its Subsidiaries may dispose of assets of
the Company or its Subsidiaries in exchange for capital assets that (i)
are for use in a Related Business and (ii) have an aggregate fair
market value which, when added to the fair market value of any cash,
Cash Equivalents or Publicly Traded Stock received by the Company or
any of its Subsidiaries in exchange for such capital assets, is equal
to or greater than the aggregate fair market value of the property and
assets being disposed of, provided, however, that (A) in no event may
the Company and its Subsidiaries, in any 12-month period, dispose of
assets pursuant to this paragraph having an aggregate fair market value
of in excess of $10 million;
(K) The Company may sell common stock of TransTexas
to TransTexas; and
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(L) Unless otherwise required by the foregoing clauses (A)
through (K), the proceeds of any Asset Sale permitted thereby shall be
used by the Company or its Subsidiaries for purposes not otherwise
prohibited by the Indenture.
(c) The Company may, within 360 days following the receipt of Net Cash
Proceeds from any Asset Sale, apply an amount equal to such Net Cash Proceeds
to: (i) the repayment of Senior Debt of the Company or any Guarantor that
results in a permanent reduction in the principal amount of such Senior Debt in
an amount equal to the principal amount so repaid or (ii) make Capital
Expenditures for use in a Related Business or (iii) make cash payments in the
ordinary course of business that are not otherwise prohibited by the Indenture,
provided that the aggregate amount so used from and after the Issue Date does
not exceed $20,000,000 (without duplication of amounts used for Capital
Expenditures in clause (ii) above).
If, upon completion of the 360-day period (the "Trigger Date"), an
amount equal to any portion of the Net Cash Proceeds of any Asset Sale shall not
have been applied by the Company as described in clauses (i), (ii) or (iii) of
the preceding paragraph and such amount together with an amount equal to any
remaining net cash proceeds from any prior Asset Sale (such aggregate
constituting "Excess Proceeds"), exceeds $10 million, then the Company shall
make an offer (the "Offer to Purchase") to purchase from all Holders of the
Notes and holders of any then outstanding Pari Passu Debt required to be
repurchased or repaid on a permanent basis in connection with an Asset Sale, an
aggregate principal amount of Notes and any then outstanding Pari Passu Debt
equal to such Excess Proceeds as follows:
(l) the Company shall make an offer to purchase from all
Holders of the Notes in accordance with the procedures set forth in the
Indenture the maximum principal amount (expressed as a multiple of
$1000) of Notes that may be purchased out of an amount (the "Offer
Amount") equal to the product of such Excess Proceeds multiplied by a
fraction, the numerator of which is the outstanding principal amount of
the Notes and the denominator of which is the sum of the outstanding
principal amount of the Notes and such Pari Passu Debt, if any and (ii)
to the extent required by such Pari Passu Debt and provided there is a
permanent reduction in the principal amount of such Pari Passu Debt and
a corresponding permanent reduction in the Company's ability to incur
Pari Passu Debt or Subordinated Debt, the Company shall make an offer
to purchase such Pari Passu Debt (the "Pari Passu Offer') in an amount
(the "Pari Passu Debt Amount") equal to the excess of the Excess
Proceeds over the Offer Amount.
(2) The offer price for the Notes shall be payable in cash in
an amount equal to 100% of the principal amount of the Notes tendered
pursuant to an Offer to Purchase, plus accrued and unpaid interest, if
any, to the date such Offer to Purchase is consummated (the "Offer
Price"), in accordance with the procedures set forth in the Indenture.
To the extent that the aggregate Offer Price of the Notes tendered
pursuant to an Offer to Purchase is less than the Offer Amount relating
thereto or the aggregate amount of the Pari Passu Debt that is
purchased or repaid pursuant to the Pari Passu Offer is less than the
Pari Passu Debt Amount (such shortfall constituting a "Net Proceeds
Deficiency"), the Company may use such Net Proceeds Deficiency, or any
portion thereof, for general corporate purposes, subject to the
"Limitation on Restricted Payments" covenant.
(3) If the aggregate Offer Price of Notes validly tendered and
not withdrawn by Holders thereof exceeds the Offer Amount, Notes to be
purchased will be selected on a pro rata basis. Upon completion of an
Offer to Purchase and a Pari Passu Offer, the amount of Excess Proceeds
shall be reset to zero.
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The Company, to the extent applicable and if required by law, will
comply with Section 14 of the Exchange Act and the provisions of Regulation 14E
and any other tender offer rules under the Exchange Act and any other federal
and state securities laws, rules and regulations which may then be applicable to
any offer by the Company to purchase the Notes at the option of the holders
pursuant to an Offer to Purchase.
It is expected that agreements with respect to Senior Debt the Company
may enter into would prohibit, and the TARC Intercompany Loan currently
prohibits, the repurchase of Debt subordinated to such Senior Debt, which would
include the Notes. Failure of the Company to repurchase the Notes validly
tendered to the Company pursuant to an Offer to Purchase would create an Event
of Default with respect to the Notes. In addition, the subordination provisions
of the Indenture prohibit, subject to certain conditions, the repurchase or
repayment of the Notes if there is a default under Senior Debt. As a result, the
Company may be prohibited from making payment pursuant to an Offer to Purchase
in connection with an Asset Sale.
Section 4.15 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law which
would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on the Notes as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
the Company hereby expressly waives all benefit or advantage of any such law,
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
It is the intention of the parties hereto to comply strictly with
applicable usury laws; accordingly, not withstanding any provision to the
contrary in this Indenture or in any of the documents securing the payment of
the Notes or otherwise relating thereto, in no event shall this Indenture or
such documents require or permit the payment, charging, taking, reserving, or
receiving of any sums constituting interest under applicable laws which exceed
the maximum amount permitted by such laws. If any such excess interest is
contracted for, charged, taken, reserved, or received in connection with the
Notes or in any of the documents securing the payment thereof or otherwise
relating thereto, or in any communication by the Holders or any other person to
the Company or any other person, or in the event all or part of the principal or
interest on the Notes shall be prepaid or accelerated, so that under any of such
circumstances or under any other circumstance whatsoever the amount of interest
contracted for, charged, taken, reserved, or received on the amount of principal
actually outstanding from time to time under the Notes shall exceed the maximum
amount of interest permitted by applicable usury laws, then in any such event it
is agreed as follows: (i) the provisions of this paragraph shall govern and
control, (ii) any such excess shall be deemed an accidental and bona fide error
and canceled automatically to the extent of such excess, and shall not be
collected or collectible, (iii) any such excess which is or has been paid or
received notwithstanding this para graph shall be credited against the then
unpaid principal balance on the Notes or refunded to the Company, at the
Holders' option, and (iv) the effective rate of interest shall be automatically
reduced to the maximum lawful rate allowed under applicable laws as construed by
courts having jurisdiction hereof or thereof. Without limiting the foregoing,
all calculations of the rate of interest contracted for, charged, taken,
reserved, or received in connection herewith which are made for the purpose of
determining whether such rate exceeds the maximum lawful rate shall be made to
the extent permitted by applicable laws by amortizing, prorating, allocating and
spreading during the period of the full term of the Notes, including all prior
and subsequent renewals and extensions, all interest at any time contracted for,
charged, taken, reserved, or received. The terms of this paragraph shall be
deemed to be incorporated in every document, security instrument, and
communication relating to this Indenture and the Notes.
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Section 4.16 Guarantee by Subsidiaries. All future Material
Subsidiaries and Subsidiaries that guarantee any pari passu Debt or Subordinated
Debt of the Company or of any other Subsidiary of the Company shall jointly and
severally guarantee irrevocably and unconditionally all principal, premium, if
any, and interest on the Notes on a senior subordinated unsecured basis. The
Company covenants to cause each of such Subsidiaries promptly to execute and
deliver to the Trustee a Guarantee pursuant to which such Subsidiary will
guarantee payment of the Notes and the performance of the Company's other
obligations under this Indenture to the extent set forth in this Section 4.16.
The liability of each Guarantor under its Guarantee will be limited to
the amount of its Adjusted Net Assets.
Section 4.17 Intentionally Omitted.
Section 4.18 Limitations on Line of Business. The Company shall not
directly or indirectly engage to any substantial extent in any line or lines of
business activity other than a Related Business and, such other business
activities as are reasonably related or incidental thereto.
Section 4.19 Separate Existence and Formalities. The Company
hereby covenants and agrees that:
(a) it will maintain procedures designed to prevent commingling of the
funds of the Company, its Subsidiaries' and TransAmerican, other than pursuant
to the Services Agreement;
(b) all actions taken by the Company and its Subsidiaries will be taken
pursuant to authority granted by the Board of Directors of the Company and its
Subsidiaries, to the extent required by law or the Company's and its
Subsidiaries' Certificate of Incorporation or By-laws;
(c) the Company and its Subsidiaries will maintain separate records and
books of account and such records and books of account shall be separate from
those of TransAmerican in each case in accordance with generally accepted
accounting principles;
(d) the Company and its Subsidiaries will maintain correct minutes of
the meetings and other corporate proceedings of the owners of its capital stock
and the Board of Directors and otherwise comply with requisite corporate
formalities required by law;
(e) the Company and its Subsidiaries will not knowingly mislead any
other Person as to the identity or authority of the Company and its
Subsidiaries; and
(f) the Company and its Subsidiaries will provide for all of their
operating expenses and liabilities from their own separate funds, other than
pursuant to the Services Agreement.
Section 4.20 Accounts Receivable Subsidiary.
(a) Notwithstanding the provisions of Section 4.3, the Company may, and
may permit any of its Subsidiaries to, make Investments in an Accounts
Receivable Subsidiary (i) the proceeds of which are applied within five Business
Days of the making thereof solely to finance the purchase of accounts receivable
of the Company and its Subsidiaries and (ii) in the form of Accounts Receivable
Subsidiary Notes to the extent permitted by clause (b) below; provided that the
aggregate amount of such Investments shall not exceed the greater of $20 million
or 20% of the TARC Borrowing Base at any time;
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(b) The Company may not, nor may it permit any of its Subsidiaries to,
sell accounts receivable to an Accounts Receivable Subsidiary except for
consideration in an amount not less than that which would be obtained in an
arm's length transaction and solely in the form of cash or Cash Equivalents;
provided that an Accounts Receivable Subsidiary may pay the purchase price for
any such accounts receivable in the form of Accounts Receivable Subsidiary Notes
so long as, after giving effect to the issuance of any such Accounts Receivable
Subsidiary Notes, the aggregate principal amount of all Accounts Receivable
Subsidiary Notes outstanding shall not exceed the greater of $20 million or 20%
of the aggregate purchase price paid for all outstanding accounts receivable
purchased by an Accounts Receivable Subsidiary since the date of this Indenture
(and not written off or required to be written off in accordance with the normal
business practice of an Accounts Receivable Subsidiary);
(c) The Company may not, nor may it permit any of its Subsidiaries to,
enter into any guarantee, subject any of their respective properties or assets
(other than the accounts receivable sold by them to an Accounts Receivable
Subsidiary) to the satisfaction of any liability or obligation or otherwise
incur any liability or obligation (contingent or otherwise), in each case, on
behalf of an Accounts Receivable Subsidiary or in connection with any sale of
accounts receivable or participation interests therein by or to an Accounts
Receivable Subsidiary, other than obligations relating to breaches of
representations, warranties, covenants, and other agreements of the Company or
any of its Subsidiaries with respect to the accounts receivable sold by the
Company or any of its Subsidiaries to an Accounts Receivable Subsidiary or with
respect to the servicing thereof; provided that neither the Company nor any of
its Subsidiaries shall at any time guarantee or be otherwise liable for the
collectibility of accounts receivable sold by them; and
(d) The Company may not, nor may it permit any of its Subsidiaries to,
sell accounts receivable to, or enter into any such transaction with or for the
benefit of, an Accounts Receivable Subsidiary (i) if such Accounts Receivable
Subsidiary pursuant to or within the meaning of any Bankruptcy Law (A) commences
a voluntary case, (B) consents to the entry of an order for relief against it in
an involuntary case, (C) consents to the appointment of a Custodian of it or for
all or substantially all of its property, (D) makes general assignment for the
benefit of its creditors, or (E) generally is not paying its debts as they
become due; or (ii) if a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that (A) is for relief against such Accounts
Receivable Subsidiary in an involuntary case, (B) appoints a Custodian of such
Accounts Receivable Subsidiary or for all or substantially all of the property
of such Accounts Receivable Subsidiary, or (C) orders the liquidation of such
Accounts Receivable Subsidiary, and, with respect to clause (ii) hereof, the
order or decree remains unstayed and in effect for 60 consecutive days.
Section 4.21 Limitation on Ranking of Future Debt. The Company shall
not, directly or indirectly, incur, create, or suffer to exist any Debt which is
contractually subordinate or junior in right of payment (to any extent) to any
Debt of the Company and which is not expressly by the terms of the instrument
creating such Debt made pari passu with, or subordinated and junior in right of
payment to, the Notes. The Guarantors will not, directly or indirectly, issue,
assume, guarantee, incur or otherwise become liable for any Debt which is both
subordinate or junior in right of payment to any Guarantor Senior Debt and
senior or superior in right of payment to the Guarantees.
Section 4.22 Maintenance of Interest Reserve Account.
(a) The Company shall establish and maintain with and at the Trustee a
custodial account in the name of the Trustee (or any agent thereof) (the
"Interest Reserve Account"), under the sole dominion and control of the Trustee.
Funds shall be released from the Interest Reserve Account only in accordance
with this Section 4.22.
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(b) The Company shall, out of the proceeds received by it from the
issuance of the Notes, make an initial deposit into the Interest Reserve Account
in the amount of $42,000,000 (the "Interest Reserve Amount"), such deposit being
of sufficient amount to pay for the first three (3) semi-annual interest
payments on the Notes issued on the date hereof that will become due and payable
on June 30, 1998, December 30, 1998 and June 30, 1999 (the "Subject Interest
Payment Dates"). If, after the date hereof and prior to June 30, 1999, the
Company issues additional Notes (the "Additional Notes") pursuant to the
Indenture (other than Notes issued upon transfer of or to replace Notes issued
on the date hereof) the Company shall, out of the proceeds received by it from
the issuance of the Additional Notes, deposit into the Interest Reserve Account
an amount sufficient to pay the interest that will become due and payable on
such Additional Notes on the Subject Interest Payment Dates.
(c) The Interest Reserve Account will be held in trust by the Trustee
for the equal and ratable benefit of the Holders and not commingled with any
ordinary deposit or commercial bank account, will be maintained with the
corporate trust department of the Trustee for the equal and ratable benefit of
the Holders and, to the extent expressly provided herein, for the Company, and
will be subject to the provisions of this Agreement. In accordance with written
instructions received from the Company, the Trustee shall, subject to the
Trustee's rights under this Section 4.22, (i) invest amounts on deposit in the
Interest Reserve Account in Cash Equivalents in the name of the Trustee as the
Company may select, (ii) invest interest paid on the Cash Equivalents referred
to in clause (i) above, and reinvest other proceeds of any such Cash Equivalents
that may mature or be sold, in Cash Equivalents in the name of the Trustee as
the Company may select (the Cash Equivalents referred to in clauses (i) and (ii)
above being, collectively, "Reserve Account Investments") and (iii) deposit and
hold in the Interest Reserve Account all interest and proceeds that are not
invested or reinvested in Reserve Account Investments. All disbursements made to
the Holders pursuant to this Agreement shall be made by the Trustee irrespective
of, and without deduction for, any counterclaim, defense, recoupment or setoff
and shall be final, and the Trustee will not seek to recover from any Holder for
any reason any such payment once made. All service charges and fees with respect
to the Interest Reserve Account shall be paid by the Company.
(d) The Company has no right to direct the Trustee to disburse the
funds in the Interest Reserve Account, other than the rights, exercisable upon
the giving by the Company of not less than one Business Day prior written notice
to the Trustee, (i) from time to time during the term of this Agreement, to
direct the Trustee to disburse to or for the account of the Company all or any
portion of the interest and other earnings on the funds on deposit in the
Interest Reserve Account and on Reserve Account Investments and (ii) if the
Company optionally redeems the Notes, from time to time during the term of this
Agreement, to direct the Trustee to disburse to or for the account of the
Company all or any portion of the funds on deposit in the Interest Reserve
Account in an aggregate amount that bears the same proportion to the aggregate
amount of funds in the Interest Reserve Account immediately prior to the release
of such proceeds as the aggregate principal amount of the Notes so redeemed by
the Company bears to the aggregate principal amount of Notes outstanding
immediately prior to such redemption; provided, however, that the Trustee shall
not be required to disburse any funds pursuant to this paragraph (d) after the
occurrence and during the continuance of an Event of Default. The amount of
funds that may be released by the Trustee to the Company in connection with any
such optional redemption shall be net of any costs, fees and expenses (such as
breakage costs) incurred to permit such release.
(e) The Trustee shall liquidate part or all of the Reserve Account
Investments, as necessary, to provide the availability of such funds in the
Investment Reserve Account as may be necessary to pay (and shall to the extent
funds are in the Interest Reserve Account pay therefrom) each of the first three
(3) semi-annual interest payments on the Notes, when and as they come due, and
to make such disbursements as may from time to time be requested by the Company
as permitted hereby. The Trustee shall disburse funds from the Interest Reserve
Account solely for the purposes of making the payments and distributions
described hereunder.
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(f) Promptly after the payment in full of the interest accrued through
and including the installment of interest payable on the June 30, 1999 interest
payment, the Trustee shall liquidate all Reserve Account Investments remaining
and shall disburse the full amount of the funds then on deposit in the Interest
Reserve Account to or for the account of the Company, whereupon the Interest
Reserve Account shall be closed; provided, however, that the Trustee shall not
disburse any funds pursuant to this paragraph (f) after the occurrence and
during the continuance of an Event of Default. If any such Event of Default is
continuing at the Interest Payment Date following the Subject Interest Payment
Dates, the funds in the Interest Reserve Account shall be applied to (and the
Trustee shall, to the extend of such funds, pay therefrom) the interest payment
due on such Interest Payment Date.
Section 4.23 Restriction on Sale and Issuance of Subsidiary Stock. The
Company shall not sell, and shall not permit any of its Subsidiaries to, issue
or sell, any shares of Capital Stock of any Subsidiary of the Company to any
Person other than the Company or a Wholly Owned Subsidiary of the Company unless
an amount equal to the net proceeds of such sale is used by the Company within
180 days after the date of such sale for one or more of the purposes specified
in Section 4.14(a).
Section 4.24 [Intentionally Omitted].
ARTICLE V
SUCCESSOR CORPORATION
Section 5.1 When the Company May Merge, Etc.
(a) The Company shall not, and shall not permit any Guarantor to,
consolidate with or merge with or into any other Person, or, directly or
indirectly, sell, lease, assign, transfer or convey all or substantially all of
its assets (computed on a consolidated basis), to another Person or group of
Persons acting in concert, whether in a single transaction or through a series
of related transactions, unless:
(1) either (a) the Company or the Guarantor, as the case may be, shall
be the continuing Person, or (b) the Person (if other than the Company) formed
by such consolidation or into which the Company or the Guarantor, as the case
may be, is merged or to which all or substantially all of the properties and
assets of the Company, or the Guarantor, as the case may be, are transferred as
an entirety or substantially as an entirety (the Company or the Guarantor, as
the case may be, or such other Person being hereinafter referred to as the
"Surviving Person") shall be a corporation or partnership organized and validly
existing under the laws of the United States, any State thereof or the District
of Columbia, and shall expressly assume, by an indenture supplemental hereto
executed and delivered to the Trustee on or prior to the consummation of such
transaction, in form satisfactory to the Trustee, all the obligations of the
Company or the Guarantor, as the case may be, under the Notes and this
Indenture;
(2) No Default or Event of Default shall exist or shall occur
immediately after giving effect to such transaction;
(3) on a pro forma consolidated basis, immediately after giving effect
to such transaction and the assumption of the obligations contemplated by clause
(1), above, and the incurrence or anticipated incurrence of any Debt or
Disqualified Capital Stock to be incurred or issued in connection therewith, (x)
the Net Worth of the Surviving Person is at least equal to the Net Worth of such
predecessor or transferring entity immediately prior to such transaction and (y)
except for a merger of the Company into a wholly owned Subsidiary of TEC or its
wholly owned Subsidiary incorporated in the State of Delaware solely for the
purpose of facilitating a
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reincorporation in Delaware or a repurchase of the Old TARC Warrants into a
right to receive cash, which conversion or reincorporation would not require
cash payments by the Company in excess of $250,000 in the aggregate, the
Surviving Person could incur $1.00 of additional Senior Debt pursuant to the
third paragraph of Section 4.11, as applicable (in all cases for this purpose
only, as if the Phase I Completion Date has occurred);
(4) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
assignment, or transfer and such supplemental indenture comply with this Article
V and that all conditions precedent herein provided relating to such transaction
have been satisfied; and
(5) except for a merger of the Company into a wholly owned Subsidiary
of TEC or its wholly owned Subsidiary incorporated in the State of Delaware
solely for the purpose of facilitating a reincorporation in Delaware or a
repurchase of the Old TARC Warrants into a right to receive cash, which
conversion or reincorporation would not require cash payments by the Company in
excess of $250,000 in the aggregate, at the time of or within 45 days after the
occurrence of the event specified above, the Notes, if then rated, have not been
or are not downgraded by Standard & Poor's Corporation, Inc., ▇▇▇▇▇'▇ Investors
Service, Inc. or any successor rating agencies to either entity to a rating
below that which existed immediately prior to the time the event specified above
is first publicly announced.
For purposes of this Section 5.1, the Consolidated Fixed Charge
Coverage Ratio shall be determined on a pro forma consolidated basis (giving
effect to such transaction) for the four fiscal quarters immediately preceding
such transaction.
(b) For purposes of clause (a), 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 Company, which
properties and assets, if held by the Company, instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the
Company, on a consolidated basis, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.
(c) Notwithstanding anything contained in the foregoing to the
contrary, any Subsidiary of the Company with a Net Worth greater than zero, may
merge into the Company (or a wholly owned Subsidiary of the Company) at any
time, provided, that the Company, shall have delivered to the Trustee an
Officers' Certificate stating that such Subsidiary has a Net Worth greater than
zero and such merger does not result in a Default or an Event of Default
hereunder. Notwithstanding anything contained in the foregoing, an Accounts
Receivable Subsidiary may merge into the Company, provided, that such merger
does not result in a Default or Event of Default hereunder.
Section 5.2 Successor Corporation Substituted. Upon any consolidation
or merger, or any transfer of assets in accordance with Section 5.1, the
Surviving Person formed by such consolidation or into which the Company, or a
Guarantor, as the case may be, is merged or to which such transfer is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company, or such Guarantor, as the case may be, under this Indenture with
the same effect as if such Surviving Person had been named as the Company, or
such Guarantor, as the case may be, herein. When a Surviving Person duly assumes
all of the obligations of the Company pursuant hereto and pursuant to the Notes,
the predecessor shall be released from such obligations.
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ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Section 6.1 Events of Default. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be caused voluntarily or involuntarily or
effected, without limitation, 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):
(a) default in the payment of any interest upon any Note as and when
the same becomes due and payable, and the continuance of such default for a
period of 30 days;
(b) default in the payment of all or any part of the principal of (or
premium, if any, applicable to), the Notes when and as the same becomes due and
payable at maturity, redemption, by acceleration, or otherwise, including
default in the payment of the Offer Price in accordance with Section 4.14 or the
Change of Control Purchase Price in accordance with Article XI;
(c) default in the observance or performance of, or breach of, any
covenant, agreement or warranty of the Company or any of its Subsidiaries
contained in the Notes or this Indenture, and continuance of such default or
breach for the period and after the notice, if any, specified below;
(d) a default which extends beyond any stated period of grace
applicable thereto, including any extension thereof, under any mortgage,
indenture or instrument under which there is outstanding any Debt of the Company
or any of its Subsidiaries with an aggregate principal amount in excess of
$20,000,000, or failure to pay such Debt at its stated maturity, if either (a)
such default results from the failure to pay principal of, premium, if any, or
interest on any such Debt when due and such default continues beyond any
applicable cure, forebearance or notice period; provided that a waiver by the
lenders of such Debt of such default shall constitute a waiver hereunder for the
same period or (b) as a result of such default, the maturity of such Debt has
been accelerated prior to its scheduled maturity, and such default or
acceleration continues for a period of 10 days; provided, that a rescission or
annulment of such default or acceleration (prior to any action taken by the
Trustee with respect to the acceleration of the Obligations under the Notes)
pursuant to the agreement governing such Debt shall constitute a waiver
hereunder for the same period;
(e) a decree, judgment, or order by a court of competent jurisdiction
shall have been entered adjudging the Company or any of its Subsidiaries as
bankrupt or insolvent, or ordering relief against the Company or any of its
Subsidiaries in response to the commencement of an involuntary bankruptcy case,
or approving as properly filed a petition seeking reorganization or liquidation
of the Company or any of its Subsidiaries under any bankrupt cy or similar law,
and such decree or order shall have continued undischarged and unstayed for a
period of 60 days; or a decree or order of a court of competent jurisdiction
over the appointment of a receiver, liquidator, trustee, or assignee in
bankruptcy or insolvency of the Company, any of its Subsidiaries, or of the
property of any such Person, or for the winding up or liquidation of the affairs
of any such Person, shall have been entered, and such decree, judgment, or order
shall have remained in force undischarged and unstayed for a period of 60 days;
(f) the Company or any of its Subsidiaries shall institute voluntary
bankruptcy proceedings, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent seeking
reorganization or liquidation under any bankruptcy or similar law or similar
statute, or shall consent to the filing of any such petition, or shall consent
to the appointment of a Custodian, receiver, liquidator, trustee, or assignee in
bankruptcy or insolvency of it or any of its assets or property, or shall make a
general assignment for the benefit
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of creditors, or shall admit in writing its inability to pay its debts generally
as they become due, or shall, within the meaning of any Bankruptcy Law, become
insolvent, fail generally to pay its debts as they become due, or take any
corporate action in furtherance of or to facilitate, conditionally or otherwise,
any of the foregoing;
(g) final judgments not covered by insurance for the payment of money,
or the issuance of any warrant of attachment against any portion of the property
or assets of the Company or any Subsidiary, which, in the aggregate, equal or
exceed $25,000,000 at any one time shall be entered against the Company or any
of its Subsidiaries by a court of competent jurisdiction and not be stayed,
bonded or discharged for a period (during which execution shall not be
effectively stayed) of 60 days (or, in the case of any such final judgment which
provides for payment over time, which shall so remain unstayed, unbonded or
undischarged beyond any applicable payment date provided therein); or
(h) a Guarantee shall cease to be in full force and effect (other than
a release of a Guarantee by designation of a Guarantor as an Unrestricted
Subsidiary or otherwise in accordance with this Indenture) or any Guarantor
shall deny or disaffirm its obligations with respect thereto.
If a default occurs and is continuing and if it is known to the
Trustee, the Trustee must, within 90 days after the occurrence of such default,
give to the Holders notice of such default; provided, that, except in the case
of default in payment of principal of, premium, if any, or interest on the
Notes, including a default in the payment of the Offer Price or the Change of
Control Purchase Price as required by this Indenture, the Trustee will be
protected in withholding such notice if it in good faith determines that the
withholding of such notice is in the interest of the Holders.
A Default under clause (c) above (other than in the case of any
Defaults under Sections 4.3, 4.11, 4.14, or 5.1, which Defaults shall be Events
of Default without the notice specified in this paragraph or Section 4.7(c) and
upon the passage of 10 days) is not an Event of Default until the Trustee
notifies the Company, or the Holders of at least 25% in principal amount of the
outstanding Notes notify the Company and the Trustee of the Default, and the
Company does not cure the Default within 30 days after receipt of the notice.
The notice must specify the Default, demand that it be remedied and state that
the notice is a "Notice of Default." Such notice shall be given by the Trustee
if so requested by the Holders of at least 25% in principal amount of the Notes
then outstanding.
In the case of any Event of Default pursuant to the provisions of this
Section 6.1 occurring by reason of any willful action (or inaction) taken (or
not taken) by or on behalf of the Company or any Subsidiary with the intention
of avoiding the period of time the Notes are not optionally redeemable or the
payment of the premium which the Company would have to pay if the Company then
had elected to redeem the Notes pursuant to Paragraph 5 of the Notes, an
equivalent premium (or, in the case of an Event of Default prior to the time
optional redemptions are permitted, to the extent permitted by law, a premium
equal to the stated interest rate of the Notes multiplied by the quotient of (i)
the number of full years left to maturity plus one, divided by (ii) seven) shall
also become and be immediately due and payable to the extent permitted by law,
anything in this Indenture or in the Notes to the contrary notwithstanding.
Section 6.2 Acceleration of Maturity Date; Rescission and Annulment. If
an Event of Default (other than an Event of Default specified in Section 6.1(e)
or (f) relating to the Company or its Subsidiaries) occurs and is continuing,
then, and in every such case, unless the principal of all of the Notes shall
have already become due and payable, either the Trustee or the Holders of not
less than 25% in aggregate Value of then outstanding Notes, by a notice in
writing to the Company (and to the Trustee if given by Holders) (an
"Acceleration Notice"), may declare all of the principal of the Notes (or the
Change of Control Purchase Price if the Event of Default includes failure to pay
the Change of Control Purchase Price), determined as set forth below, including
in each case accrued
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interest thereon, to be due and payable immediately. If an Event of Default
specified in Section 6.1(e) or (f) relating to the Company or its Subsidiaries
occurs, all principal and accrued interest on the Notes shall be immediately due
and payable on all outstanding Notes without any declaration or other act on the
part of the Trustee or the Holders.
At any time after such a declaration of acceleration being made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter provided in this Article VI, the Holders of a
majority in aggregate Value of then outstanding Notes, by written notice to the
Company and the Trustee, may waive, on behalf of all Holders, any such
declaration of acceleration if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(1) all accrued but unpaid interest on all Notes,
(2) the principal of (and premium, if any, applicable to) any Notes
which would become due otherwise than by such declaration of acceleration, and
accrued but unpaid interest thereon at the rate borne by the Notes,
(3) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate borne by the Notes,
(4) all sums paid or advanced by the Trustee hereunder and the
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and
(b) all Events of Default, other than the non-payment of the principal
of, premium, if any, and interest on Notes which have become due solely by such
declaration of acceleration, have been cured or waived as provided in Section
6.12, including, if applicable, any Event of Default relating to the covenants
contained in Section 11.1.
Notwithstanding the previous sentence of this Section 6.2, no waiver
shall be effective for any Event of Default or event which with notice or lapse
of time or both would be an Event of Default with respect to any covenant or
provision which cannot be modified or amended without the consent of (x) 662/3%
in aggregate Value of the Notes or (y) the affected Holder of each of the
outstanding Notes, unless (x) 662/3% in aggregate Value of the Notes or (y) all
such affected Holders, respectively, agree, in writing, to waive such Event of
Default or event. No such waiver shall cure or waive any subsequent default or
impair any right consequent thereon.
Section 6.3 Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that if an Event of Default in payment of
principal, premium or interest specified in clause (1) or (2) of Section 6.1
occurs and is continuing, the Company shall, upon demand of the Trustee, pay to
it, for the benefit of the Holders of such Notes, the whole amount then due and
payable on such Notes for principal, premium (if any) and interest, and, to the
extent that payment of such interest shall be legally enforceable, interest on
any overdue principal (and premium, if any) and on any overdue interest, at the
rate borne by the Notes, and, in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection, including
compensation to, and expenses, disbursements and advances of the Trustee, its
agents and counsel.
If the Company fails to pay such amounts within 10 days of such demand,
the Trustee, in its own name and as trustee of an express trust in favor of the
Holders, may institute a judicial proceeding for the collection of the sums so
due and unpaid, may prosecute such proceeding to judgment or final decree and
may enforce the same against the Company or any other obligor upon the Notes and
collect the moneys adjudged or decreed to be
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payable in the manner provided by law out of the property of the Company or any
other obligor upon the Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effective to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
The Trustee shall also be authorized to take whatever additional action
at law or in equity may appear to be necessary or desirable to collect the
monies necessary to pay the principal, premium (if any) and interest on the
Notes.
Section 6.4 Trustee May File Proofs of Claim. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Notes or the property of the Company
or of such other obligor or their creditors, the Trustee (irrespective of
whether the principal of the Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company or any obligor for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise to take any and all actions under the TIA,
including
(a) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Notes and to
file such 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 agent and
counsel) and of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any debtor-in-possession or Custodian or other similar official in any such
judicial proceeding is hereby authorized by each Holder to make such payments
to the Trustee and, in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment, or composition affecting the Notes or
the rights of any Holder thereof or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
Section 6.5 Trustee May Enforce Claims Without Possession of Notes. All
rights of action and claims under this Indenture or the Notes may be prosecuted
and enforced by the Trustee without the possession of any of the Notes or the
production thereof in any proceeding relating thereto, and any such proceeding
instituted by the Trustee shall be brought in its own name as trustee of an
express trust in favor of the Holders, and any recovery of judgment shall, after
provision for the payment of compensation to, and expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Notes in respect of which such judgment has been recovered.
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Section 6.6 Priorities. Any money collected by the Trustee pursuant to
this Article VI shall be applied in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on account
of principal, premium (if any) or interest, upon presentation of the Notes and
the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the Trustee in payment of all amounts due pursuant
to Section 7.7;
SECOND: To the Holders in payment of the amounts then due and unpaid
for principal of, premium (if any) and interest on, the Notes in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Notes for principal, premium (if any) and interest respectively;
and
THIRD: To whomsoever may be lawfully entitled thereto, the
remainder, if any.
Section 6.7 Limitation on Suits. No Holder of any Note shall have any
right to order or direct the Trustee to institute any proceeding, judicial or
otherwise, with respect to this Indenture, or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of then
outstanding Notes shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities to be incurred
or reasonably probable to be incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the outstanding Notes;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
Section 6.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest. Notwithstanding any other provision of this Indenture, the
Holder of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of, and premium (if any) and interest on, such
Note on the Maturity Dates of such payments as expressed in such Note and to
institute suit for the enforcement of any such payment after such respective
dates, and such rights shall not be impaired without the consent of such Holder.
Section 6.9 Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes in Section 2.7, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every
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other right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 6.10 Delay or Omission Not Waiver. No delay or omission by the
Trustee or by any Holder of any Note to exercise any right or remedy arising
upon any Event of Default shall impair the exercise of any such right or remedy
or constitute a waiver of any such Event of Default. Every right and remedy
given by this Article VI or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be.
Section 6.11 Control by Holders. The Holder or Holders of a majority in
aggregate Value of then outstanding Notes shall 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 upon the Trustee,
provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture,
(b) the Trustee shall not determine that the action so directed would
be unjustly prejudicial to the Holders not taking part in such direction or that
such action may involve the Trustee in personal liability, and
(c) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Section 6.12 Waiver of Past Default. Subject to Section 6.8, the Holder
or Holders of not less than a majority in aggregate Value of the outstanding
Notes may, on behalf of all Holders, prior to the declaration of the maturity of
the Notes, waive any past default hereunder and its consequences, except a
default
(a) in the payment of the principal of, premium, if any, or interest
on, any Note as specified in clauses (a) and (b) of Section 6.1, or
(b) in respect of a covenant or provision hereof which, under Article
IX, cannot be modified or amended without the consent of the Holder of each
outstanding Note affected or 662/3% in aggregate Value of the Notes at the time
outstanding, as the case may be; provided that such a default may be waived by
the consent of Holders of each outstanding Note affected or 662/3% in aggregate
value of the Notes outstanding, as the case may be.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair the exercise of any right arising therefrom.
Section 6.13 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Note by his acceptance thereof shall be deemed to
have agreed, that any court may in its discretion require, 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, suffered or omitted to be taken by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to any suit instituted by the Company, to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in aggregate principal amount of
the outstanding Notes, or to any suit instituted by any Holder for enforcement
of the payment of principal of, or premium (if any) or interest on, any
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Note on or after the respective Maturity Date expressed in such Note (including,
in the case of redemption, on or after the Redemption Date).
Section 6.14 Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every case, subject to any determination in such proceeding, the Company, the
Trustee and the Holders shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of the Trustee
and the Holders shall continue as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
Section 7.1 Duties of Trustee.
(a) If a Default or an Event of Default has occurred and is continuing,
the Trustee shall exercise such of 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
his own affairs.
(b) Except during the continuance of a Default or an Event of Default:
(1) The Trustee need perform only those duties as are specifically set
forth in this Indenture and no others, and no covenants or obligations shall be
implied in or read into this Indenture which are adverse to the Trustee.
(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, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) 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 paragraph (b) of this
Section 7.1.
(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.
(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 6.2 or Section 6.11.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
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under this Indenture or at the request, order or direction of the Holders or in
the exercise of any of its rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c), (d) and (f) of this Section 7.1.
(f) The Trustee shall not be liable for interest on any assets received
by it except as the Trustee may agree in writing with the Company. Assets held
in trust by the Trustee need not be segregated from other assets except to the
extent required by law.
(g) The Trustee shall execute and deliver the Intercreditor Agreements
and any Subordination Agreements as provided in Section 12.2.
Section 7.2 Rights of Trustee. Subject to Section 7.1:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting on any document 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.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of Counsel,
which shall conform to Sections 13.4 and 13.5. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
certificate or opinion.
(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.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, notice, request, direction, consent, order, bond, debenture, 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.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Whenever by the terms of this Indenture, the Trustee shall be
required to transmit notices or reports to any or all Holders, the Trustee shall
be entitled to rely on the information provided by the Registrar as to the names
and addresses of the Holders as being correct. If the Registrar is other than
the Trustee, the Trustee shall not be responsible for the accuracy of such
information.
Section 7.3 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, its Subsidiaries, or their respective
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Affiliates with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee must comply with Sections
7.10 and 7.11.
Section 7.4 Trustee's Disclaimer. The Trustee makes no representation
as to the validity or adequacy of this Indenture or the Notes and it shall not
be accountable for the Company's use of the proceeds from the Notes, and it
shall not be responsible for (i) the use or application of any funds received by
a Paying Agent other than the Trustee, (ii) any statement in the Notes, other
than the Trustee's certificate of authentication or (iii) the sufficiency of the
collateral for the Notes.
The Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the
part of the Company hereunder or in any Security Documents, except as
specifically set forth herein or therein.
Section 7.5 Notice of Default. If a Default or an Event of Default
occurs and is continuing and if it is known to the Trustee pursuant to Section
4.7(c), the Trustee shall mail to each Noteholder notice of the uncured Default
or Event of Default within 90 days after such Default or Event of Default
occurs. Except in the case of a Default or an Event of Default in payment of
principal (or premium, if any,) of, or interest on, any Note (including all
payments due on any Maturity Date), the Trustee may withhold the notice if and
so long as the board of directors, the executive committee or a trust committee
of directors and/or responsible officers of the Trustee in good faith determines
that withholding the notice is in the interest of the Holders.
Section 7.6 Reports by Trustee to Holders. Within 60 days after each
[May 15] beginning with the May 15 following the date of this Indenture, the
Trustee shall, if required, mail to each Noteholder a brief report dated as of
such May 15 that complies with TIA ss. 313(a). The Trustee also shall comply
with TIA ▇▇.▇▇. 313(b) and 313(c).
A copy of each report at the time of its mailing to Noteholders shall
be mailed to the Company and filed with the SEC and each stock exchange, if any,
on which the Notes are listed.
Section 7.7 Compensation and Indemnity. The Company shall pay to the
Trustee from time to time compensation for its services (in whatever capacity
rendered) in accordance with the Trustee's fee schedule, as may be amended from
time to time. 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 disbursements, expenses and advances
incurred or made by it. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents, accountants, experts and
counsel.
The Company shall indemnify the Trustee (in its capacity as Trustee)
and each of its officers, directors, attorneys-in-fact and agents for, and hold
it harmless against, any claim, demand, expense (including but not limited to,
compensation, disbursements and expenses of the Trustees' agents and counsel),
loss or liability incurred by it without negligence or bad faith on its part,
arising out of or in connection with the administration of this trust and its
rights or duties hereunder including the reasonable costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder. The Trustee shall
notify the Company promptly of any claim asserted against the Trustee for which
it may seek indemnity. The Company shall defend the claim and the Trustee shall
provide reasonable cooperation at the Company's expense in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel; provided that the Company will not be required to
pay such fees and expenses if it assumes the Trustee's defense and there is no
conflict of interest as reasonably determined by the Trustee between the Company
and the Trustee in connection with such defense. The Company need not pay for
any settlement made without its written consent, which shall not be unreasonably
withheld. The Company need not
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reimburse any expense or indemnify against any loss or liability to the extent
incurred by the Trustee through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Notes on all assets held or collected by
the Trustee, in its capacity as Trustee, except assets held in trust to pay
principal (and premium, if any,) or interest on particular Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(e) or (f) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Company's obligations under this Section 7.7 and any lien arising
hereunder shall survive the resignation or removal of the Trustee, the discharge
of the Company's obligations pursuant to Article VIII and any rejection or
termination of this Indenture under any Bankruptcy Law.
Section 7.8 Replacement of Trustee. The Trustee may resign by so
notifying the Company in writing. The Holder or Holders of a majority in
principal amount of the outstanding Notes may remove the Trustee by so notifying
the Company and the Trustee in writing and may appoint a successor trustee with
the Company's consent.
The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver, Custodian, or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holder or
Holders of a majority in principal amount of the Notes may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the Trustee provided for in Section 7.7 have
been paid, the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided in Section 7.7,
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. A successor Trustee shall mail notice of its
succession to each Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holder or Holders of at least 10% in principal amount of the outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Noteholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
Section 7.9 Successor Trustee by Merger, Etc. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the resulting,
surviving or transferee corporation without any further act shall, if such
resulting, surviving or transferee corporation is otherwise eligible hereunder,
be the successor Trustee.
Section 7.10 Eligibility; Disqualification. The Trustee shall at all
times satisfy the requirements of TIA ss. 310(a)(1), (a)(2) and (a)(5). The
Trustee shall comply with TIA ss. 310(b).
Section 7.11 Preferential Collection of Claims against Company. The
Trustee shall comply with TIA ss. 311(a), excluding any creditor relationship
listed in TIA ss. 311(b). A Trustee who has resigned or been removed shall be
subject to TIA ss. 311(a) to the extent indicated.
Section 7.12 No Bond. The Trustee shall not be required to give any
bond or surety in respect to the execution of its trusts, powers, rights and
duties under this Indenture or otherwise in respect of the premises.
Section 7.13 Condition to Action. Notwithstanding anything elsewhere in
this Indenture to the contrary, the Trustee shall have the right, but shall not
be required, to demand, in respect of the authentication of any Notes or any
other action within the purview of this Indenture, any showings, certificates,
opinions, or other information, or corporate action or evidence thereof in
addition to that by the terms hereof required, as a condition of such action by
the Trustee if reasonably deemed desirable by the Trustee for the purpose of
establishing the right to the authentication of any Notes or the taking of any
other action by the Trustee.
Section 7.14 Investment. The Trustee shall not be responsible or liable
for any loss suffered in connection with any investment of funds made by it at
the direction of the Company.
ARTICLE VIII
SATISFACTION AND DISCHARGE
Section 8.1 Satisfaction, Discharge of the Indenture and Defeasance of
the Notes. The Company shall be deemed to have paid and discharged the entire
Debt on the Notes and the provisions of this Indenture shall cease to be of
further effect (subject to Sections 8.3 and 8.7), if:
(a) The Company irrevocably deposits in trust for the benefit of the
Holders of the Notes with the Trust ee, pursuant to an irrevocable trust
agreement in form and substance reasonably satisfactory to the Trustee, (i) U.S.
Legal Tender, (ii) U.S. Government Obligations or (iii) a combination thereof
which, after payment of all Federal, state and local taxes or other charges or
assessments in respect thereof payable by the Trustee, through the payment of
principal and interest will provide, not later than one day before the due date
of payment in respect of the Notes, U.S. Legal Tender in an amount which, in the
opinion of a nationally recognized firm of independent certified public
accountants expressed in a written certification thereof (in form and substance
reasonably satisfactory to the Trustee) delivered to the Trustee, is sufficient
to pay the principal of, premium, if any, and each installment of principal and
interest on the Notes then outstanding, on the stated maturity or on the
applicable redemption date, as the case may be, and the Company must specify
whether the Notes are being defeased to maturity or to a particular redemption
date;
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(b) Such deposits shall not cause the Trustee to have a conflicting
interest as defined in and for purposes of the TIA;
(c) No Default or Event of Default relating to clauses (e) or (f) of
Section 6.1 shall have occurred or be continuing on the date of such deposit or
shall occur on or before the 91st day (or one day after such greater period of
time in which any such deposit of trust funds may remain subject to set aside or
avoidance under bankruptcy or insolvency laws) after the date of such deposit,
and such deposit will not result in a Default or Event of Default under this
Indenture or a breach or violation of, or constitute a default under, any other
instrument to which the Company or any Subsidiary of the Company is a party or
by which it or its property is bound;
(d) The deposit, defeasance and discharge will not be deemed, or result
in, a Federal income taxable event to the Holders of the Notes and the Holders
will be subject to Federal income tax in the same amounts and in the same manner
and at the same times as would have been the case if such deposit and defeasance
had not occurred;
(e) The deposit shall not result in the Company, the Trustee or the
trust being subject to regulation under the Investment Company Act of 1940;
(f) After the passage of 90 days (or any greater period of time in
which any such deposit of trust funds may remain subject to set aside or
avoidance under Bankruptcy Laws insofar as those laws apply to the Company)
following the irrevocable deposit of the trust funds, such funds will not be
subject to any set aside or avoidance under Bankruptcy Laws affecting creditors'
rights generally; and
(g) The Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel (who may be outside counsel to the Company, but not
in-house counsel to the Company), each in form and substance satisfactory to the
Trustee, stating that all conditions precedent specified herein relating to the
defeasance contemplated by this Section 8.1 have been complied with.
In the event all or any portion of the Notes are to be redeemed through
such irrevocable trust, the Company must make arrangements satisfactory to the
Trustee, at the time of such deposit, for the giving of the notice of such
redemption or redemptions by the Trustee in the name and at the expense of the
Company.
In the event that the Company takes the necessary action to comply with
the provisions described in this Section 8.1 and the Notes are declared due and
payable because of the occurrence of an Event of Default within the time period
specified in Section 8.1(c), or at any time under Section 8.3, the Company will
remain liable for all amounts due on the Notes at the time of acceleration
resulting from such Event of Default in excess of the amount of U.S. Legal
Tender and U.S. Government Obligations deposited with the Trustee pursuant to
this Section 8.1 at the time of such acceleration.
Section 8.2 Termination of Obligations Upon Cancellation of the Notes.
In addition to the Company's rights under Section 8.1, the Company may terminate
all of its respective obligations under this Indenture (subject to Sections 8.3
and 8.7) when:
(a) all Notes theretofore authenticated and delivered (other than Notes
which have been destroyed, lost or stolen and which have been replaced or paid
as provided in Section 2.7) have been delivered to the Trustee for cancellation;
(b) the Company has paid or caused to be paid all sums payable
hereunder by the Company; and
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(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent specified
herein relating to the satisfaction and discharge of this Indenture have been
complied with.
Section 8.3 Survival of Certain Obligations. Notwithstanding the
satisfaction and discharge of this Indenture and of the Notes referred to in
Section 8.1 or 8.2, the respective obligations of the Company and the Trustee
under Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.11, 2.12, Article III, 4.1, 4.2,
4.4, 6.8, 7.7, 7.8, 8.5, 8.6, 8.7 and this Section 8.3 shall survive until the
Notes are no longer outstanding, and thereafter the obligations of the Company
and the Trustee under Sections 6.8, 7.7, 7.8, 8.5, 8.6, 8.7 and this Section 8.3
shall survive. Nothing contained in this Article VIII shall abrogate any of the
obligations or duties of the Trustee under this Indenture.
Section 8.4 Acknowledgment of Discharge by Trustee. After (i) the
conditions of Section 8.1 or 8.2 have been satisfied, (ii) the Company has paid
or caused to be paid all other sums payable hereunder by the Company and (iii)
the Company has delivered to the Trustee an Officers' Certificate and an Opinion
of Counsel, each stating that all conditions precedent referred to in clause
(i), above, relating to the satisfaction and discharge of this Indenture have
been complied with, the Trustee upon request shall acknowledge in writing the
discharge the Company's obligations under this Indenture except for those
surviving obligations specified in Section 8.3.
Section 8.5 Application of Trust Assets. The Trustee shall hold any
U.S. Legal Tender or U.S. Government Obligations deposited with it in the
irrevocable trust established pursuant to Section 8.1. The Trustee shall apply
the deposited U.S. Legal Tender or U.S. Government Obligations, together with
earnings thereon, through the Paying Agent (other than the Company or any
Subsidiary of the Company), in accordance with this Indenture and the terms of
the irrevocable trust agreement, to the payment of principal of and interest on
the Notes.
Section 8.6 Repayment to the Company. Upon termination of the trust
established pursuant to Section 8.1, the Trustee and the Paying Agent shall
promptly pay to the Company upon request any excess U.S. Legal Tender or U.S.
Government Obligations held by them.
The Trustee and the Paying Agent shall pay to the Company upon request,
and, if applicable, in accordance with the irrevocable trust established
pursuant to Section 8.1, any U.S. Legal Tender or U.S. Government Obligations
held by them for the payment of principal of or interest on the Notes that
remain unclaimed for two years after the date on which such payment shall have
become due; provided, however, that the Trustee or such Paying Agent, before
being required to make any such repayment, may, at the expense of the Company,
cause to be published once, in a newspaper customarily published on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining shall be repaid
to the Company. After payment to the Company, Holders entitled to such payment
must look to the Company for such payment as general creditors unless an
applicable abandoned property law designates another Person.
Section 8.7 Reinstatement. If the Trustee or Paying Agent is unable to
apply any U.S. Legal Tender or U.S. Government Obligations in accordance with
Section 8.1 or 8.2 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 Company's obligations under this
Indenture, the Security Documents and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.1 or 8.2 until such time
as the Trustee or Paying Agent is permitted to apply all such U.S. Legal Tender
or U.S. Government Obligations in accordance with Section 8.1 or 8.2; provided,
however, that if the Company has made any payment of principal of or interest on
any Notes because of the reinstatement of its obligations, the Company shall be
surrogated to the
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rights of the Holders of such Notes to receive such payment from the U.S. Legal
Tender or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1 Supplemental Indentures Without Consent of Holders. Without
the consent of any Holder, the Company and the Guarantors, if any, when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto in form
satisfactory to the Trustee, for any of the following purposes:
(a) to cure any ambiguity, defect, or inconsistency, or to make any
other provisions with respect to matters or questions arising under this
Indenture which shall not be inconsistent with the provisions of this Indenture,
provided such action pursuant to this clause (a) shall not adversely affect the
interests of any Holder in any respect;
(b) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the Company or
to make any other change that does not adversely affect the rights of any
Holder, provided that the Company has delivered to the Trustee an Opinion of
Counsel stating that such change does not adversely affect the rights of any
Holder;
(c) to evidence the succession of another Person to the Company and the
assumption by any such successor of the obligations of the Company herein and in
the Notes in accordance with Article V; or
(d) to comply with the TIA.
Section 9.2 Amendments, Supplemental Indentures and Waivers with
Consent of Holders. Subject to Section 6.8, with the consent of the Holders of
not less than a majority in aggregate Value of then outstanding Notes, by
written act of said Holders (including an electronic mechanism utilized by the
Depository Trust Company as a means of receiving consents or tenders of
securities) delivered to the Company and the Trustee, the Company, when
authorized by Board Resolutions, and the Trustee may amend or supplement this
Indenture, the Notes or enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or the Notes or of modifying
in any manner the rights of the Holders under this Indenture or the Notes;
provided, that no such modification may, without the consent of the Holders of
not less than 662/3 in aggregate Value of the Notes at the time outstanding, (i)
prior to a Change of Control, reduce the Change of Control Purchase Price or
alter the provisions of Article XI or (ii) prior to the date upon which an Offer
to Purchase is required to be made, reduce the Offer Price or alter the
provisions of Section 4.14 in a manner adverse to the Holders. Subject to
Section 6.8, the Holder or Holders of not less than a majority, in aggregate
Value of then outstanding Notes may waive compliance by the Company with any
provision of this Indenture or the Notes; provided, that no such waiver may,
without the consent of the Holders of not less than 662/3 in aggregate Value of
the Notes at the time outstanding, have the effect of (i) prior to a Change of
Control, reducing the Change of Control Purchase Price or altering the
provisions of Article XI or (ii) prior to the date upon which an Offer to
Purchase is required to be made, reduce the Offer Price or alter the provisions
of Section 4.14 in a manner adverse to the Holders. Notwithstanding any of the
above, however, no
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such amendment, supplemental indenture or waiver shall, without the consent of
the Holder of each outstanding Note affected thereby:
(a) reduce the percentage of Value of Notes whose Holders must consent
to an amendment, supplement or waiver of any provision of this Indenture or the
Notes;
(b) reduce the rate or extend the time for payment of interest on any
Note;
(c) (i) reduce the principal amount of any Note or (ii) after the date
upon which a Change of Control Offer is required to be made, reduce the Change
of Control Purchase Price or (iii) after the date upon which an Offer to
Purchase is required to be made, reduce the to Purchase Offer Price or (iv)
reduce the Redemption Price;
(d) change the Stated Maturity or the payment date of any installment
of principal of, or the payment date of any installment of interest on, any
Note;
(e) (i) alter the redemption provisions of Article III or of paragraph
5 of the Notes or (ii) after the date upon which a Change of Control Offer is
required to be made, alter the terms or provisions of Article XI;
(f) make any changes in the provisions concerning waivers of Defaults
or Events of Default by Holders of the Notes (except to increase any required
percentage or to provide that certain other provisions hereof cannot be modified
or waived without the consent of the Holders of each outstanding Note affected
thereby) or the rights of Holders to recover the principal or premium of,
interest on, or redemption payment with respect to, any Note;
(g) make any changes in Section 6.4, 6.7 or this third sentence of this
Section 9.2; or
(h) make the principal of, or the interest on, any Note payable with
anything or in any manner other than as provided for in this Indenture
(including changing the place of payment where, or the coin or currency in
which, any Note or any premium or the interest thereon is payable) and the Notes
as in effect on the date hereof.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
After an amendment, supplement or waiver under this Section 9.2 or 9.4
becomes effective, it shall bind each Holder.
In connection with any amendment, supplement or waiver under this
Article IX, the Company may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment, supplement or waiver.
Section 9.3 Compliance with TIA. Every amendment, waiver or supplement
of this Indenture or the Notes shall comply with the TIA as then in effect.
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Section 9.4 Revocation and Effect of Consents. Until an amendment,
waiver or supplement becomes effective, a consent to it by a Holder is a
continuing consent by the Holder and every subsequent Holder of a Note or
portion of a Note that evidences the same debt as the consenting Holder's Note,
even if notation of the consent is not made on any Note. However, any such
Holder or subsequent Holder may revoke the consent as to his Note or portion of
his Note by written notice to the Company or the Person designated by the
Company as the Person to whom consents should be sent if such revocation is
received by the Company or such Person before the date on which the Trustee
receives an Officers' Certificate certifying that the Holders of the requisite
principal amount of Notes have consented (and not theretofore revoked such
consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be the date so fixed by the
Company notwithstanding the provisions of the TIA. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those Persons who were Holders at such record date, and only those Persons (or
their duly designated proxies), shall be entitled to revoke any consent
previously given, regardless of whether such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Noteholder; provided that any such waiver shall not impair or affect
the right of any Holder to receive payment of principal and premium of and
interest on a Note, on or after the respective dates set for such amounts to
become due and payable expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates.
Section 9.5 Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Trustee may require the
Holder of the Note to deliver it to the Trustee or require the Holder to put an
appropriate notation on the Note. The Trustee may place an appropriate notation
on the Note about 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. Any failure to make the appropriate notation or to issue a new
Note shall not affect the validity of such amendment, supplement or waiver.
Section 9.6 Trustee to Sign Amendments, Etc. The Trustee shall execute
any amendment, supplement or waiver authorized pursuant to this Article IX,
provided that the Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture. The Trustee at the expense of the Company
shall be entitled to receive, and shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article IX is authorized or permitted by this
Indenture.
ARTICLE X
MEETINGS OF NOTEHOLDERS
Section 10.1 Purposes for Which Meetings May Be Called. A meeting of
Noteholders may be called at any time and from time to time pursuant to the
provisions of this Article X for any of the following purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to waive or to consent to the waiving of any
Default or Event of Default hereunder and its consequences, or to take any other
action authorized to be taken by Noteholders pursuant to any of the provisions
of Article VI;
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(b) to remove the Trustee or appoint a successor Trustee pursuant to
the provisions of Article VII;
(c) to consent to an amendment, supplement or waiver pursuant to the
provisions of Section 9.2; or
(d) to take any other action (i) authorized to be taken by or on behalf
of the Holder or Holders of any specified aggregate principal amount of the
Notes under any other provision of this Indenture, or authorized or permitted by
law or (ii) which the Trustee deems necessary or appropriate in connection with
the administration of this Indenture.
Section 10.2 Manner of Calling Meetings. The Trustee may at any time
call a meeting of Noteholders to take any action specified in Section 10.1, to
be held at such time and at such place in the City of New York, New York or
elsewhere as the Trustee shall determine. Notice of every meeting of
Noteholders, setting forth the time and place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be mailed by the
Trustee, first-class postage prepaid, to the Company and to the Holders at their
last addresses as they shall appear on the registration books of the Registrar,
not less than 10 nor more than 60 days prior to the date fixed for a meeting.
Any meeting of Noteholders shall be valid without notice if the Holders
of all Notes then outstanding are present in Person or by proxy, or if notice is
waived before or after the meeting by the Holders of all Notes outstanding, and
if the Company and the Trustee are either present by duly authorized
representatives or have, before or after the meeting, waived notice.
Section 10.3 Call of Meetings by Company or Holders. In case at any
time the Company, pursuant to a Board Resolution, or the Holders of not less
than 10% in aggregate principal amount of the Notes then outstanding, shall have
requested the Trustee to call a meeting of Noteholders to take any action
specified in Section 10.1, by written request setting forth in reasonable detail
the action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting within 20 days after receipt of such request,
then the Company or the Holders of Notes in the amount above specified may
determine the time and place in the City of New York, New York or elsewhere for
such meeting and may call such meeting for the purpose of taking such action, by
mailing or causing to be mailed notice thereof as provided in Section 10.2, or
by causing notice thereof to be published at least once in each of two
successive calendar weeks (on any Business Day during such week) in a newspaper
or newspapers printed in the English language, customarily published at least
five days a week of a general circulation in the City of New York, State of New
York, the first such publication to be not less than 10 nor more than 60 days
prior to the date fixed for the meeting.
Section 10.4 Who May Attend and Vote at Meetings. To be entitled to
vote at any meeting of Noteholders, a Person shall (a) be a registered Holder of
one or more Notes, or (b) be a Person appointed by an instrument in writing as
proxy for the registered Holder or Holders of Notes. The only Persons who shall
be entitled to be present or to speak at any meeting of Noteholders shall be the
Persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
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Section 10.5 Regulations May Be Made by Trustee; Conduct of the
Meeting; Voting Rights; Adjournment. Notwithstanding any other provision of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any action by or any meeting of Noteholders, in regard to proof of
the holding of Notes and of the appointment of proxies, and in regard to the
appointment and duties of inspectors of votes, and submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall think appropriate.
Such regulations may fix a record date and time for determining the Holders of
record of Notes entitled to vote at such meeting, in which case those and only
those Persons who are Holders of Notes at the record date and time so fixed, or
their proxies, shall be entitled to vote at such meeting regardless of whether
they shall be such Holders at the time of the meeting.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Noteholders as provided in Section 10.3, in which case the Company
or the Noteholders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by vote of the Holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote.
At any meeting each Noteholder or proxy shall be entitled to one vote
for each $1,000 Value of Notes held or represented by him; provided, however
that no vote shall be cast or counted at any meeting in respect of any Notes
challenged as not outstanding and ruled by the chairman of the meeting to be not
then outstanding. The chairman of the meeting shall have no right to vote other
than by virtue of Notes held by him or instruments in writing as aforesaid duly
designating him as the proxy to vote on behalf of other Noteholders. Any meeting
of Noteholders duly called pursuant to the provisions of Section 10.2 or Section
10.3 may be adjourned from time to time by vote of the Holder or Holders of a
majority in aggregate Value of the Notes represented at the meeting and entitled
to vote, and the meeting may be held as so adjourned without further notice.
Section 10.6 Voting at the Meeting and Record to Be Kept. The vote upon
any resolution submitted to any meeting of Noteholders shall be by written
ballots on which shall be subscribed the signatures of the Holders of Notes or
of their representatives by proxy and the principal amount of the Notes voted by
the ballot. The permanent chairman of the meeting shall appoint two inspectors
of votes, who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Noteholders shall be prepared
by the secretary of the meeting and there shall be attached to such record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more Persons having knowledge of the facts, setting
forth a copy of the notice of the meeting and showing that such notice was
mailed as provided in Section 10.2 or published as provided in Section 10.3. The
record shall be signed and verified by the affidavits of the permanent chairman
and the secretary of the meeting and one of the duplicates shall be delivered to
the Company and the other to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
Section 10.7 Exercise of Rights of Trustee or Noteholders May Not Be
Hindered or Delayed by Call of Meeting. Nothing contained in this Article X
shall be deemed or construed to authorize or permit, by reason of any call of a
meeting of Noteholders or any rights expressly or impliedly conferred hereunder
to make such call, any hindrance or delay in the exercise of any right or rights
conferred upon or reserved to the Trustee or to the Noteholders under any of the
provisions of this Indenture or of the Notes.
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ARTICLE XI
RIGHT TO REQUIRE REPURCHASE
Section 11.1 Repurchase of Notes at Option of the Holder Upon Change of
Control.
(a) In the event that a Change of Control occurs, each Holder of Notes
shall have the right, at such Holder's option, upon the terms and conditions of
this Article XI, to require the Company to repurchase all or any part of such
Holder's Notes (provided that the principal amount of such Notes at maturity
must be $1,000 or an integral multiple thereof) on a date that is no later than
60 Business Days after the occurrence of a Change of Control (the date on which
the repurchase is effected being referred to herein as the "Change of Control
Payment Date"), at a cash purchase price (the "Change of Control Purchase
Price") equal to 101% of the principal amount thereof, plus accrued and unpaid
interest, if any, on and including the Change of Control Payment Date.
(b) Within 20 Business Days after the Company knows, or reasonably
should know, of the occurrence of a Change of Control, the Company shall make an
irrevocable unconditional offer (a "Change of Control Offer") to the Holders to
purchase for U.S. Legal Tender all of the Notes pursuant to the offer described
in clause (c) of this Section 11.1 at the Change of Control Purchase Price.
Within five Business Days after each date upon which the Company knows, or
reasonably should know, of the occurrence of a Change of Control requiring the
Company to make a Change of Control Offer pursuant to this Section 11.1, the
Company shall so notify the Trustee.
(c) Notice of a Change of Control Offer shall be sent, at least 20
Business Days prior to the Final Change of Control Put Date (as defined below),
by first class mail, by the Company to each Holder at its registered address,
with a copy to the Trustee. The notice to the Holders shall contain all
instructions and materials required by applicable law and shall contain or make
available to Holders other information material to such Holders' decision to
tender Notes pursuant to the Change of Control Offer. The notice, which shall
govern the terms of the Offer, shall state:
(1) that the Change of Control Offer is being made pursuant to such
notice and this Section 11.1 and that all Notes, or portions thereof, tendered
will be accepted for payment;
(2) the Change of Control Purchase Price, the Change of Control Payment
Date and the Final Change of Control Put Date (as defined below);
(3) that any Note, or portion thereof, not tendered or accepted for
payment will continue to accrue interest, if interest is then accruing;
(4) that, unless the Company defaults in depositing U.S. Legal Tender
with the Paying Agent in accor dance with the last paragraph of this clause (c),
or payment is otherwise prevented, any Note, or portion thereof, accepted for
payment pursuant to the Change of Control Offer shall cease to accrue interest
after the Change of Control Payment Date;
(5) that Holders electing to have a Note, or portion thereof, purchased
pursuant to a Change of Control Offer will be required to surrender the Note,
with the form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, to the Paying Agent (which may not for purposes of this
Section 11.1, notwithstanding anything in this Indenture to the contrary, be the
Company or any Affiliate of the Company) at
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the address specified in the notice prior to the close of business on the third
Business Day prior to the Change of Control Payment Date (the "Final Change of
Control Put Date");
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, prior to the close of business on the Final Change of
Control Put Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Notes the Holder is
withdrawing and a statement containing a facsimile signature that such Holder is
withdrawing his election to have such principal amount of Notes purchased;
(7) that Holders whose Notes were purchased only in part will be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered; and
(8) a brief description of the events resulting in such Change of
Control.
On or before the Change of Control Payment Date, the Company shall (i)
accept for payment Notes or portions thereof properly tendered pursuant to the
Change of Control Offer prior to the close of business on the Final Change of
Control Put Date, (ii) deposit with the Paying Agent U.S. Legal Tender
sufficient to pay the Change of Control Purchase Price (including accrued and
unpaid interest) of all Notes so tendered and (iii) deliver or cause to be
delivered to the Trustee Notes so accepted together with an Officers'
Certificate listing the Notes or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to the Holders of Notes so
accepted payment in an amount equal to the Change of Control Purchase Price
(including accrued and unpaid interest), and the Trustee shall promptly
authenticate and mail or deliver to such Holders a new Note equal in principal
amount, to any unpurchased portion of the Note surrendered. Any Notes not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date. Any such Change of Control Offer shall comply with all applicable
provisions of Federal and state laws, rules and regulations, including those
regulating tender offers, if applicable, and, if such laws, rules or regulations
require or prohibit any action inconsistent with the foregoing, compliance by
the Company with such laws, rules and regulations will not constitute a breach
of the Company's obligations with respect to the foregoing.
ARTICLE XII
SUBORDINATION
Section 12.1 Notes Subordinated to Senior Indebtedness.
The Company and each Holder, by its acceptance of Notes, agree that (a)
the payment of the principal of and interest on the Notes and (b) any other
payment in respect of the Notes, including on account of the acquisition or
redemption of the Notes by the Company (including, without limitation, pursuant
to Article XI) is subordinated, to the extent and in the manner provided in
this Article XII, to the prior payment in full of all Senior Debt of the
Company, whether outstanding at the date of this Indenture or thereafter
created, incurred, assumed or guaranteed, and that these subordination
provisions are for the benefit of the holders of Senior Debt.
This Article XII shall constitute a continuing offer to all Persons
who, in reliance upon such provisions, become holders of, or continue to hold,
Senior Debt, and such provisions are made for the benefit of the holders of
Senior Debt, and such holders are made obligees hereunder and any one or more of
them may enforce such provisions.
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Section 12.2 No Payment on Securities in Certain Circumstances.
(a) No payment may be made by the Company or on behalf of the Company
on account of principal of or interest on the Notes or to acquire or repurchase
any of the Notes or on account of the redemption provisions of the Notes (i)
upon the maturity of any Senior Debt by lapse of time, acceleration or
otherwise, unless and until all such Senior Debt is first paid in full or (ii)
upon the happening of any default in payment of any principal of or interest on
any Senior Debt when the same becomes due and payable (a "Payment Default"),
unless and until such Payment Default shall have been cured or waived or shall
have ceased to exist.
(b) Upon (i) the happening of an event of default (other than a Payment
Default) that permits the holders of Senior Debt to declare such Senior Debt to
be due and payable (or, in the case of letters of credit, require cash
collateralization thereof) and (ii) written notice of such event of default
given to the Company and the Trustee by the lenders' agent under the Company's
working capital facility, if any, secured by Receivables and Inventory (provided
that such working facility constitutes Senior Debt) or holders of an aggregate
of at least $30 million principal amount outstanding of any Senior Debt or their
representative (a "Payment Notice"), then, unless and until such event of
default has been cured or waived or otherwise has ceased to exist, no payment
(by set-off or otherwise) may be made by or on behalf of the Company or any
Guarantor which is an obligor under such Senior Debt on account of any
Obligation in respect of the Notes, including the principal of, premium, if any,
or interest on the Notes, or to repurchase any of the Notes, or on account of
the redemption provisions of the Notes (or liquidated damages pursuant to the
registration rights agreement relating to the Notes), in any such case, other
than payments made with Junior Securities. Notwithstanding the foregoing, unless
the Senior Debt in respect of which such event of default exists has been
declared due and payable in its entirety within 179 days after the Payment
Notice is delivered as set forth above (the "Payment Blockage Period") (and such
declaration has not been rescinded or waived), at the end of the Payment
Blockage Period, the Company and the Guarantors shall be required to pay all
sums not paid to the Holders of the Notes during the Payment Blockage Period due
to the foregoing prohibitions and to resume all other payments as and when due
on the Notes. Any number of Payment Notices may be given; provided, however,
that (i) not more than one Payment Notice shall be given within a period of any
360 consecutive days, and (ii) no default that existed upon the date of such
Payment Notice or the commencement of such Payment Blockage Period (whether or
not such event of default is on the same issue of Senior Debt) shall be made the
basis for the commencement of any other Payment Blockage Period unless such
other Payment Blockage Period is commenced by a Payment Notice from the
Representative and such event of default shall have been cured or waived for a
period of at least 90 consecutive days.
(c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company or any Guarantor (other than Junior
Securities) shall be received by the Trustee or the Holders at a time when such
payment or distribution is prohibited by the foregoing provisions, such payment
or distribution shall be held in trust for the benefit of the holders of such
Senior Debt, and shall be paid or delivered by the Trustee or such Holders, as
the case may be, to the holders of such Senior Debt remaining unpaid or
unprovided for or to their representative or representatives, or to the trustee
or trustees under any indenture pursuant to which any instruments evidencing any
of such Senior Debt may have issued, ratably according to the aggregate
principal amounts remaining unpaid on account of such Senior Debt held or
represented by each, for application to the payment of all such Senior Debt
remaining unpaid, to the extent necessary to pay or to provide for the payment
of all such Senior Debt in full in cash or Cash Equivalents or otherwise to the
extent holders accept satisfaction of amounts due by settlement in other than
cash or Cash Equivalents after giving effect to any concurrent payment or
distribution to the holders of such Senior Debt.
Section 12.3 Notes Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization.
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Upon any distribution of assets of the Company or any Guarantor upon
any dissolution, winding up, total or partial liquidation or reorganization of
the Company or a Guarantor, whether voluntary or involuntary, in bankruptcy,
insolvency, receivership or a similar proceeding or upon assignment for the
benefit of creditors or any marshalling of assets or liabilities, (i) the
holders of all Senior Debt of the Company or such Guarantor, as applicable, will
first be entitled to receive payment in full in cash or Cash Equivalents or
otherwise to the extent holders accept satisfaction of amounts due by settlement
in other than cash or Cash Equivalents (or have such payment duly provided for)
before the Holders are entitled to receive any payment on account of any
Obligation in respect of the Notes, including the principal of, premium, if any,
and interest on the Notes (or liquidated damages pursuant to the registration
rights agreement relating to the Notes) (other than Junior Securities) and (ii)
any payment or distribution of assets of the Company or such Guarantor of any
kind or character from any source, whether in cash, property or securities
(other than Junior Securities) to which the Holders or the Trustee on behalf of
the Holders would be entitled (by set-off or otherwise) but for the
subordination provisions contained in the Indenture, will be paid by the
liquidating trustee or agent or other person making such a payment or
distribution directly to the holders of such Senior Debt or their representative
to the extent necessary to make payment in full in Cash or Cash Equivalents (or
have such payment duly provided for) on all such Senior Debt remaining unpaid,
after giving effect to any concurrent payment or distribution to the holders of
such Senior Debt.
Section 12.4 Securityholders to Be Subrogated to Rights of Holders of
Senior Debt.
Subject to the payment in full of all Senior Debt of the
Company as provided herein, the Holders of Notes shall be subrogated to the
rights of the holders of such Senior Debt to receive payments or distributions
of assets of the Company applicable to the Senior Debt until all amounts owing
on the Notes shall be paid in full, and for the purpose of such subrogation no
such payments or distributions to the holders of such Senior Debt by the
Company, or by or on behalf of the Holders by virtue of this Article XII, which
otherwise would have been made to the Holders shall, as between the Company and
the Holders, be deemed to be payment by the Company or on account of such Senior
Debt, it being understood that the provisions of this Article XII are and are
intended solely for the purpose of defining the relative rights of the Holders,
on the one hand, and the holders of such Senior Debt, on the other hand.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article XII shall
have been applied, pursuant to the provisions of this Article XII, to the
payment of amounts payable under Senior Debt of the Company, then the Holders
shall be entitled to receive from the holders of such Senior Debt any payments
or distributions received by such holders of Senior Debt in excess of the amount
sufficient to pay all amounts payable under or in respect of such Senior Debt in
full.
Section 12.5 Obligations of the Company Unconditional.
Nothing contained in this Article XII or elsewhere in this
Indenture or in the Notes is intended to or shall impair as between the Company
and the Holders, the obligation of each such Person, which is absolute and
unconditional, to pay to the Holders the principal of, premium, if any, interest
on, and Liquidated Damages with respect to, the notes as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders and creditors of the Company
other than the holders of the Senior Debt, nor shall anything herein or therein
prevent the Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article XII, of the holders of Senior Debt in respect
of cash, property or securities of the Company received upon the exercise of any
such remedy. Notwithstanding anything to the contrary in this Article XII or
elsewhere in this Indenture or in the Notes, upon any distribution of assets of
the Company referred to in this Article XII, the Trustee, subject to the
provisions of Sections 7.1 and 7.2, and the Holders shall be entitled to rely
upon any order
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or decree made by any court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending, or a
certificate of the liquidating trustee or agent or other Person making any
distribution to the Trustee or to the Holders for the purpose of ascertaining
the Persons entitled to participate in such distribution, the holders of the
Senior Debt and other Indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article XII so long as such court has been apprised
of the provisions of, or the order, decree or certificate makes reference to,
the provisions of this Article XII. Nothing in this Section 12.5 shall apply to
the claims of, or payments to, the Trustee under or pursuant to Section 7.7.
Section 12.6 Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice.
The Trustee shall not at any time be charged with knowledge of
the existence of any facts which would prohibit the making of any payment to or
by the Trustee unless and until a Trust Officer of the Trustee or any Paying
Agent shall have received, no later than one Business Day prior to such payment,
written notice thereof from the Company or from one or more holders of Senior
Indebtedness or from any representative therefor and, prior to the receipt of
any such written notice, the Trustee, subject to the provisions of Sections 7.1
and 7.2, shall be entitled in all respects conclusively to assume that no such
fact exists.
Section 12.7 Application by Trustee of Assets Deposited with It.
Amounts deposited in trust with the Trustee pursuant to and in
accordance with Article VIII shall be for the sole benefit of the Holders of the
Notes and, to the extent allocated for the payment of Notes, shall not be
subject to the subordination provisions of this Article XII. Otherwise, any
deposit of assets with the Trustee or the Agent (whether or not in trust) for
the payment of principal of or interest on any Notes shall be subject to the
provisions of Sections 12.1, 12.2, 12.3 and 12.4; provided that, if prior to one
Business Day preceding the date on which by the terms of this Indenture any such
assets may become distributable for any purpose (including, without limitation,
the payment of either principal of or interest on any Note) the Trustee or such
Paying Agent shall not have received with respect to such assets the written
notice provided for in Section 12.6, then the Trustee or such Paying Agent shall
have full power and authority to receive such assets and to apply the same to
the purpose for which they were received, and shall not be affected by any
notice to the contrary which may be received by it on or after such date.
Section 12.8 Subordination Rights Not Impaired by Acts or Omissions of
the Company or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt
to enforce subordination provisions contained in this Article XII shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of the Company or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may have or be
otherwise charged with. The holders of Senior Debt may extend, renew, modify or
amend the terms of the Senior Debt or any security therefor and release, sell or
exchange such security and otherwise deal freely with the Company, all without
affecting the liabilities and obligations of the parties to this Indenture or
the Holders.
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Section 12.9 Holders of Notes Authorize Trustee to Effectuate
Subordination of Securities.
Each Holder of the Notes by his acceptance thereof authorizes
and expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provisions contained
in this Article XII and to protect the rights of the Holders pursuant to this
Indenture, and appoints the Trustee his attorney-in-fact for such purpose,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors of the Company),
the immediate filing of a claim for the unpaid balance of his Notes in the form
required in said proceedings and cause said claim to be approved. If the Trustee
does not file a proper claim or proof of debt in the form required in such
proceeding prior to 30 days before the expiration of the time to file such claim
or claims, then the holders of the Senior Debt or their representative are or is
hereby authorized to have the right to file and are or is hereby authorized to
file an appropriate claim for and on behalf of the Holders of said Notes.
Nothing herein contained shall be deemed to authorize the Trustee or the holders
of Senior Debt or their representative to authorize or consent to or accept or
adopt on behalf of any Holder of Notes any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof, or to authorize the Trustee or the holders of Senior Debt or their
representative to vote in respect of the claim of any Holder of Note in any such
proceeding.
Section 12.10 Right of Trustee to Hold Senior Debt.
The Trustee shall be entitled to all of the rights set forth
in this Article XII in respect of any Senior Debt at any time held by it to the
same extent as any other holder of Senior Debt, and nothing in this Indenture
shall be construed to deprive the Trustee of any of its rights as such holder.
Section 12.11 Article XII Not to Prevent Events of Default.
The failure to make a payment on account of principal of,
premium, if any, interest on, or Liquidated Damages with respect to, the Notes
by reason of any provision of this Article XII shall not be construed as
preventing the occurrence of a Default or an Event of Default under Section 6.1
or in any way prevent the Holders from exercising any right hereunder other than
the right to receive payment on the Notes.
Section 12.12 No Fiduciary Duty of Trustee to Holders of Senior Debt.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Debt, and shall not be liable to any such holders (other
than for its willful misconduct or negligence) if it shall in good faith
mistakenly pay over or distribute to the Holders of Securities or the Company or
any other Person, cash, property or securities to which any holders of Senior
Debt shall be entitled by virtue of this Article XII or otherwise. Noth ing in
this Section 12.12 shall affect the obligation of any other such Person to hold
such payment for the benefit of, and to pay such payment over to, the holders of
Senior Debt or their representative.
ARTICLE XIII
MISCELLANEOUS
Section 13.1 TIA Controls. If any provision of this Indenture limits,
qualifies, or conflicts with the duties imposed by operation of the TIA, the
imposed duties, upon qualification of this Indenture under the TIA, shall
control.
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Section 13.2 Notices. Any notices or other communications to the
Company or the Trustee required or permitted hereunder shall be in writing, and
shall be sufficiently given if made by hand delivery, by telex, by telecopier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
if to the Company:
TransAmerican Refining Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
if to the Trustee:
First Union National Bank
Corporate Trust Department
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
The Company or the Trustee by notice to each other party may designate
additional or different addresses as shall be furnished in writing by such
party. Any notice or communication to the Company or the Trustee shall be deemed
to have been given or made as of the date so delivered, if personally delivered;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
five Business Days after mailing if sent by registered or certified mail,
postage prepaid (except that a notice of change of address shall not be deemed
to have been given until actually received by the addressee).
Any notice or communication mailed to a Noteholder shall be mailed to
him by first class mail or other equivalent means at his address as it appears
on the registration books of the Registrar and shall be sufficiently given to
him 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 mailed in the manner provided above, it is duly
given, regardless of whether the addressee receives it.
Section 13.3 Communications by Holders with Other Holders. Noteholders
may communicate pursuant to TIA ss. 312(b) with other Noteholders with respect
to their rights under this Indenture or the Notes. The Company, the Trustee, the
Registrar and any other Person shall have the protection of TIA ss. 312(c).
Section 13.4 Certificate and Opinion as to Conditions Precedent. Upon
any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of the signers, 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.
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Section 13.5 Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(1) a statement that the Person 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 Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to regardless of whether such covenant or condition has been
complied with; and
(4) a statement as to whether, in the opinion of each such Person, such
condition or covenant has been complied with; provided, however, that with
respect to matters of fact an Opinion of Counsel may rely on an Officers'
Certificate or certificates of public officials.
Section 13.6 Rules by Trustee, Paying Agent, Registrar. The Trustee may
make reasonable rules for action by or at a meeting of Noteholders. The Paying
Agent or Registrar may make reasonable rules for its functions.
Section 13.7 Legal Holidays. A "Legal Holiday" used with respect to a
particular place of payment is a Saturday, a Sunday or a day on which banking
institutions at such place are not required to be open. If a payment date is a
Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
Section 13.8 Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY HEREBY IRREVOCABLY SUBMITS
TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF
MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF
MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE AND THE NOTES AND IRREVOCABLY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW,
TRIAL BY JURY AND ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING HEREIN SHALL AFFECT THE
RIGHT OF THE TRUSTEE OR ANY NOTEHOLDER TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE COMPANY IN ANY OTHER JURISDICTION.
Section 13.9 No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret another indenture, loan or debt agreement
of any of the Company or any of its Subsidiaries. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
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Section 13.10 No Recourse against Others. A director, officer,
employee, stockholder or incorporator, as such, of the Company or any of its
Subsidiaries shall not have any liability for any obligations of the Company or
such Subsidiary under the Notes or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creations. Each Noteholder
by accepting a Note waives and releases all such liability. Such waiver and
release are part of the consideration for the issuance of the Notes.
Section 13.11 Successors. All agreements of the Company in this
Indenture and the Notes shall bind its successor. All agreements of the Trustee
in this Indenture shall bind its successor.
Section 13.12 Duplicate Originals. All parties may sign any number of
copies or counterparts of this Indenture. Each signed copy or counterpart shall
be an original, but all of them together shall represent the same agreement.
Section 13.13 Severability. In case any one or more of the provisions
in this Indenture or in the Notes shall be held invalid, illegal or
unenforceable, in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions shall not in any way be affected or impaired thereby, it being
intended that all of the provisions hereof shall be enforceable to the full
extent permitted by law.
Section 13.14 Table of Contents, Headings, Etc. The Table of Contents,
Cross-Reference Table and headings of the Articles and the Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof and shall in no way modify or restrict any of the terms
or provisions hereof.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
TRANSAMERICAN REFINING CORPORATION
By:
-----------------------------------
Name:
Title:
[Seal]
Attest:
-----------------------------------
FIRST UNION NATIONAL BANK
as Trustee
By:
-----------------------------------
Name:
Title:
84
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Unit
Exhibit C - Certificate of Transferor
85
EXHIBIT A
(FACE OF NOTE)
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST
COMPANY (THE "DEPOSITORY") TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY 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 SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DEPOSITORY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR
SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DEPOSITORY), 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.]1
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE 144(K) AS PERMITTING
RESALES BY NON-AFFILIATES OF RESTRICTED SECURITIES WITHOUT RESTRICTION) AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY
PREDECESSOR OF SUCH NOTE) ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,
TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT THAT IS PURCHASING THE NOTE FOR ITS OWN ACCOUNT, OR FOR
THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE.
--------
1 This paragraph should be included only if the Note is issued in global form.
A-1
86
[FORM OF NOTE]
TRANSAMERICAN REFINING CORPORATION
16% SENIOR SUBORDINATED NOTE DUE 2003
No.
$
[THIS NOTE WILL BE ISSUED WITH ORIGINAL ISSUE DISCOUNT ("OID") WITHIN THE
MEANING OF SECTION 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. THE
ISSUE DATE OF THIS NOTE IS DECEMBER 30, 1997. THE ISSUE PRICE PER $1000.00 OF
STATED PRINCIPAL AMOUNT OF THIS NOTE WILL BE $953.2951. THE ISSUE PRICE OF
THIS NOTE REPRESENTS A YIELD TO MATURITY OF 17.35% PER ANNUM COMPUTED ON A
SEMI-ANNUAL BOND EQUIVALENT BASIS AND CALCULATED FROM DECEMBER 30, 1997. THE
AMOUNT OF OID PER $1000.00 OF STATED PRINCIPAL AMOUNT OF ON THIS NOTE
WILL BE $46.7049.
CUSIP [ ]
TransAmerican Refining Corporation, a Texas corporation
(hereinafter called the "Company," which term includes any successor corporation
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to ______________________, or registered assigns, the principal
sum of ________________ Dollars, on June 30, 2003.
Interest Payment Dates: June 30 and December 30, commencing
June 30, 1998
Record Dates: June 15 and December 15
Reference is made to the further provisions of this Note on
the reverse side, which will, for all purposes, have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be
signed manually or by facsimile by its duly authorized officers.
Dated:
TRANSAMERICAN REFINING CORPORATION
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
A-2
87
Trustee's Certificate of Authentication:
This is one of the Notes referred to
in the within-mentioned Indenture:
First Union National Bank
By:
-----------------------------------
Authorized Signature
A-3
88
(BACK OF NOTE)
TRANSAMERICAN REFINING CORPORATION
16% SENIOR SUBORDINATED NOTE DUE 2003
1. Interest.
TransAmerican Refining Corporation, a Texas corporation (the
"Company"), promises to pay interest on the principal amount of this Note at a
rate of 16% per annum. To the extent it is lawful, the Company promises to pay
interest on any interest payment due but unpaid on such principal amount at a
rate of 18% per annum compounded semi-annually.
The Company will pay interest semi-annually on June 30 and December 30
of each year (each, an "Inter est Payment Date"), commencing June 30, 1998.
Interest on the Notes will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from the date of issuance of the
Notes. Interest on the Notes will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
The Company shall pay interest on the Notes (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date. Holders must
surrender Notes to a Paying Agent to collect principal payments. Except as
provided below, the Company shall pay principal and interest in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal and interest by wire transfer of Federal
funds, or interest by its check payable in such U.S. Legal Tender. The Company
shall deliver any such interest payment to the Paying Agent who shall remit such
payment to a Holder at the Holder's registered address.
3. Paying Agent and Registrar.
Initially, First Union National Bank (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders. The Company or an Affiliate of it
may, subject to certain exceptions, act as Paying Agent, Registrar or
co-Registrar.
4. Indenture.
The Company issued the Notes under an Indenture, dated as of December
30, 1997 (the "Indenture"), between the Company and the Trustee. Capitalized
terms herein are used as defined in the Indenture unless otherwise defined
herein. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
in effect on the date of the Indenture. The Notes are subject to all such terms,
and Holders of Notes are referred to the Indenture and said Act for a statement
of them. The Notes are senior subordinated obligations of the Company limited in
aggregate principal amount to an amount that yields proceeds to the Company of
$200,000,000.
A-4
89
5. Optional Redemption.
The Notes may be redeemed in whole or from time to time in part at any
time at the option of the Company, at the Redemption Price (expressed as a
percentage of principal amount) set forth below with respect to the indicated
Redemption Date, in each case, together with any accrued but unpaid interest to
the Redemption Date.
If redeemed during
the period
indicated below Redemption Price
--------------- ----------------
December 30, 1997 - June 29, 2000.................. 116.00%
June 30, 2000 - June 29, 2001...................... 110.67%
June 30, 2001 - June 29, 2002...................... 105.33%
June 30, 2002 - and thereafter..................... 100.00%
Any such redemption will comply with Article III of the Indenture.
6. Notice of Redemption.
Notice of redemption will be mailed by first class mail at least 15
days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at his registered address. Notes in denominations larger
than $1,000 may be redeemed in part.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Notes called for redemption shall have
been deposited with the Paying Agent on such Redemption Date the Notes called
for redemption will cease to bear interest and the only right of the Holders of
such Notes will be to receive payment of the Redemption Price and any accrued
and unpaid interest to the Redemption Date.
7. Denominations; Transfer; Exchange.
The Notes are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. A Holder may register the transfer of,
or exchange Notes in accordance with, the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and 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 any Notes
selected for redemption.
8. Persons Deemed Owners.
The registered Holder of a Note may be treated as the owner of it for
all purposes.
9. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee and the Paying Agent(s) will pay the money back to the
Company at its written request. Thereafter, all liability of the Trustee and
such Paying Agent(s) with respect to such money shall cease.
▇-▇
▇▇
▇▇. Discharge Prior to Redemption or Maturity.
If the Company at any time deposits into an irrevocable trust with the
Trustee U.S. Legal Tender or U.S. Government Obligations sufficient to pay the
principal of and interest on the Notes to redemption or maturity and complies
with the other provisions of the Indenture relating thereto, the Company will be
discharged from certain provisions of the Indenture and the Notes (including the
financial covenants, but excluding its obligation to pay the principal of and
interest on the Notes).
11. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the writ ten consent of the Holders of at least a
majority in aggregate Value of the Notes then outstanding, and any existing
Default or Event of Default or compliance with any provision may be waived with
the consent of the Holders of a majority in aggregate Value of the Notes then
outstanding. Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency (provided such amendment or supplement does
not adversely affect the rights of any Holder of a Note).
12. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the Company
and its Subsidiaries to, among other things, Incur additional Debt or issue
Disqualified Capital Stock, make payments in respect of its Capital Stock, enter
into transactions with Related Persons, incur Liens, sell assets, change the
nature of its business, merge or consolidate with any other Person and sell,
lease, transfer or otherwise dispose of substantially all of its properties or
assets. The limitations are subject to a number of important qualifications and
exceptions. The Company must deliver a quarterly report to the Trustee on
compliance with such limitations.
13. Change of Control.
In the event there shall occur any Change of Control, each Holder of
Notes shall have the right, at such Holder's option but subject to the
limitations and conditions set forth in the Indenture, to require the Company to
purchase on the Change of Control Payment Date in the manner specified in the
Indenture, all or any part (in integral multiples of $1,000) of such Holder's
Notes at a Change of Control Purchase Price equal to 101% of the principal
amount thereof, together with accrued and unpaid interest, if any, on and
including the Change of Control Payment Date.
14. Successors.
When a successor assumes all the obligations of its predecessor under
the Notes and the Indenture, the predecessor will be released from those
obligations.
15. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate combined Value of the Notes then
outstanding may declare all the Notes to be due and payable immediately in the
manner and with the effect provided in the Indenture. Holders of Notes may not
enforce the Indenture or the Notes except as provided in the Indenture. The
Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Notes. Subject to certain limitations, Holders of a majority in
aggregate Value of the Notes then
A-6
91
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal, premium, if any, or
interest, including a Default at any Maturity Date), if it determines that
withholding notice is in their interest.
16. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator, as such,
past, present or future, of the Company or any of its Subsidiaries or any
successor corporation shall have any liability for any obligation of the Company
or such Subsidiary under the Notes or the Indenture or for any claim based on,
in respect of or by reason of, such obligations or their creation. Each Holder
of a Note by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the Notes.
17. Authentication.
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
18. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a Note
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by
the entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act). Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Indenture.
19. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Notes as a convenience to the Holders of the Notes. No
representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.
20. Holders' Compliance with Registration Rights Agreement.
Each Holder of a Note, by his acceptance thereof, acknowledges and
agrees to the provisions of the Registration Rights Agreement, dated as of
December 30, 1997, among the Company and the ▇▇▇▇▇▇▇▇▇ & Company, Inc. (the
"Registration Rights Agreement"), including but not limited to the obligations
of the Holders with respect to a registration and the indemnification of the
Company and the Purchasers (as defined therein) to the extent provided therein.
The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to: TransAmerican Refining Corporation, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
21. Ranking.
Payment of principal, premium, if any, interest on and Liquidated
Damages with respect to the Notes is subordinated, to the extent set forth in
the Indenture, to the prior payment of all Senior Debt.
A-7
92
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
--------------------------------------------------------------------------------
Date: Signature
------------------------- ----------------------------------
(Sign exactly as your name
appears on the face of this
Note)
Signature Guarantee*
----------------------
* NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
programs:
(1) The Securities Transfer Agent Medallian Program (STAMP);
(2) The New York Stock Exchange Medallian Program (MSP);
(3) The Stock Exchange Medallian Program (SEMP).
A-8
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the
Company pursuant to Section 4.14 or Article XI of the Indenture, check the
appropriate box below:
[ ] Section 4.14 [ ] Article XI
If you want to elect to have only part of this Note purchased
by the Company pursuant to Section 4.14 or Article XI of the Indenture, as the
case may be, state the principal amount (in integral multiples of $1,000) you
want to be purchased: $_____________
Date: Signature
--------------------- -----------------------------------
(Sign exactly as your name appears on
the face of this Note)
Your Social Security or Tax Identification Number:
-------------------------
Signature Guarantee:*
-------------------------
* NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
programs:
(1) The Securities Transfer Agent Medallian Program (STAMP);
(2) The New York Stock Exchange Medallian Program (MSP);
(3) The Stock Exchange Medallian Program (SEMP).
A-9
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SCHEDULE OF EXCHANGES OF DEFINITIVE NOTES2
The following exchanges of a part of this Global Note for Definitive Notes
have been made:
Amount of decrease Amount of increase Principal Amount Signature of
in Principal Amount in Principal Amount of this Global Note authorized signatory
Date of Exchange of this Global Note of this Global Note decrease (or increase) of Trustee
----------------------------------------------------------------------------------------------------------------
---------------------
2 This should be included only if the Note is issued in global form.
A-10
95
EXHIBIT B
[Form of Unit]
TRANSAMERICA REFINING CORPORATION
UNITS
CONSISTING OF 16% SENIOR SUBORDINATED NOTES DUE 2003
AND COMMON STOCK PURCHASE WARRANTS
No. Units
CUSIP [ ]
Each Unit consists of $1,000 principal amount
of 16% Senior Subordinated Notes due 2003 of TransAmerica Refining Corporation,
a Texas corporation (hereinafter called the "Company," which term includes any
successor corporation under the Indenture hereinafter referred to) and one
Warrant to purchase 13.344257 shares of Common Stock, par value $0.01 per share,
of the Company for $0.01 per share (subject to adjustment) at any time before
5:00 p.m., New York City time, on June 30, 2003 (the "Expiration Date"). The
Notes and the Warrants are not separately transferable until the earlier of (i)
one year after the issuance of the Units, (ii) commencement of the Exchange
Offer (as defined in the Indenture) and (iii) such other date as determined by
▇▇▇▇▇▇▇▇▇ & Company, Inc. The terms of the Warrants are governed by a Warrant
Agreement dated as of December 30, 1997 (the "Warrant Agreement") between the
Company and First Union National Bank, as Warrant Agent (the "Warrant Agent"),
and are subject to the terms and provisions contained therein, to all of which
terms and provisions the holder of this Unit consents by acceptance hereof.
Copies of the Warrant Agreement are on file at the office of the Warrant Agent
at First Union National Bank, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Department, and are available to any
Warrant holder on written request and without cost. The Warrant shall be void
unless exercised before 5:00 p.m. New York City time on the Expiration Date.
The Company, for value received, hereby
promises to pay to ____________, or registered assigns, the principal sum of
____________ Dollars, on June 30, 2003.
Interest Payment Dates: June 30 and December
30, commencing June 30, 1998
Record Dates: June 15 and December 15
Reference is made to the further provisions of
the Note evidenced by this Unit on the reverse side, which will, for all
purposes, have the same effect as if set forth at this place.
B-1
96
IN WITNESS WHEREOF, the Company has caused this Unit to be
signed manually or by facsimile by its duly authorized officers..
Dated:
TRANSAMERICAN REFINING CORPORATION
By:
------------------------------------
Attest:
------------------------------------
Secretary
[Seal]
B-2
97
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Unit evidences one of those Notes described in the
within-mentioned Indenture.
FIRST UNION NATIONAL BANK,
as Trustee
as Trustee
By:
------------------------------------
Authorized Signatory
Dated:
B-3
98
TRANSAMERICAN REFINING CORPORATION
UNITS
CONSISTING OF 16% SENIOR SUBORDINATED NOTES DUE 2003
AND COMMON STOCK PURCHASE WARRANTS
1. Interest.
TransAmerican Refining Corporation, a Texas corporation (the
"Company"), promises to pay interest on the principal amount of the Notes at a
rate of 16% per annum (subject to adjustment). To the extent it is lawful, the
Company promises to pay interest on any interest payment due but unpaid on such
principal amount at a rate of 18% per annum (subject to adjustment) compounded
semi-annually.
The Company will pay interest semi-annually on June 30 and
December 30 of every year (each, an "Interest Payment Date"), commencing June
30, 1998. Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance of the Notes. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
The Company shall pay interest on the Notes (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date. Holders must
surrender Notes to a Paying Agent to collect principal payments. Except as
provided below, the Company shall pay principal and interest in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for payment of public and private debts ("U.S. Legal Tender").
However, the Company may pay principal and interest by wire transfer of Federal
funds, or interest by its check payable in such U.S. Legal Tender. The Company
may deliver any such interest payment to the Paying Agent or the Company may
mail any such interest payment to a Holder at the Holder's registered address.
3. Paying Agent and Registrar.
Initially, First Union National Bank (the "Trustee") will act
as Paying Agent and Registrar. The Company may change any Paying Agent,
Registrar or so-Registrar without notice to the Holders. The Company or any of
its Subsidiaries may, subject to certain exceptions, act as Paying Agent,
Registrar or co-Registrar.
4. Indenture.
The Company issued the Notes under an Indenture, dated as of
December 30, 1997 (the "Indenture"), between the Company and the Trustee.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the TIA, as in effect on the
date of the Indenture. The Notes are subject to all such terms, and Holders of
Notes are referred to the Indenture and said Act for a statement of them. The
Notes are senior subordinated obligations of the Company limited in aggregate
principal amount to an amount that yields proceeds to the Company of
$200,000,000.
B-4
99
5. Optional Redemption.
The Notes may be redeemed in whole or from time to time in
part at any time at the option of the Company, at the Redemption Price
(expressed as a percentage of the principal amount thereof) set forth below with
respect to the indicated Redemption Date, in each case, together with any
accrued but unpaid interest to the Redemption Date.
If redeemed during the
period indicated below Redemption Price
---------------------- ----------------
December 30, 1997 - June 29, 2000.................. 116.00%
June 30, 2000 - June 29, 2001...................... 110.67%
June 30, 2001 - June 29, 2002...................... 105.33%
June 30, 2002 and thereafter....................... 100.00%
Any such redemption will comply with Article III of the
Indenture.
6. Notice of Redemption.
Notice of redemption will be mailed by first class mail at
least 15 days but not more than 60 days before the Redemption Date to each
Holder of Notes to be redeemed at his registered address. Notes in denominations
larger than $ 1 ,000 may be redeemed in part.
Except as set forth in the Indenture, from and after any
Redemption Date, if monies for the redemption of the Notes called for redemption
shall have been deposited with the Paying Agent on such Redemption Date the
Notes called for redemption will cease to bear interest and the only right of
the Holders of such Notes will be to receive payment of the Redemption Price and
any accrued and unpaid interest to the Redemption Date.
7. Denominations; Transfer: Exchange.
The Notes are in registered form, without coupons, in
denominations of $l,000 and integral multiples of $1,000. A Holder may register
the transfer of, or exchange Notes in accordance with, the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and 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 any Notes selected for redemption.
8. Persons Deemed Owners.
The registered Holder of a Note may be treated as the owner of
it for all purposes.
9. Unclaimed Money.
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee and the Paying Agent(s) will pay the money
back to the Company at its written request. After that, all liability of the
Trustee and such Paying Agent(s) with respect to such money shall cease.
B-5
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10. Discharge Prior to Redemption or Maturity.
If the Company at any time deposits into an irrevocable trust
with the Trustee U.S. legal Tender or Government Securities sufficient to pay
the principal of and interest on the Notes to redemption or maturity and
complies with the other provisions of the Indenture relating thereto, the
Company will be discharged from certain provisions of the Indenture and the
Notes (including the financial covenants, but excluding its obligation to pay
the principal of and interest on the Notes).
11. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Notes may
be amended or supplemented with the written consent of the Holders of at least a
majority in aggregate value of the Notes then outstanding, and any existing
Default or Event of Default or compliance with any provision may be waived with
the consent of the Holders of a majority in aggregate value of the Notes then
outstanding. Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Securities to, among other things, cure
any ambiguity, defect or inconsistency (provided such amendment or supplement
does not adversely affect the rights of any Holder of a Note).
12. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of
the Company and its Subsidiaries to, among other things, Incur additional Debt
or issue Disqualified Capital Stock, make payments in respect of its Capital
Stock, enter into transactions with Related Persons, incur Liens, sell assets,
change the nature of its business, merge or consolidate with any other Person
and sell, lease, transfer or otherwise dispose of substantially all of its
properties or assets. The limitations are subject to a number of important
qualifications and exceptions. The Company must deliver a quarterly report to
the Trustee on compliance with such limitations.
13. Change of Control.
In the event there shall occur any Change of Control, each
Holder of Notes shall have the right, at such Holder's option but subject to the
limitations and conditions set forth in the Indenture, to require the Company to
purchase on the Change of Control Payment Date in the manner specified in the
Indenture, all or any part (in integral multiples of $1,000) of such Holder's
Notes at a Change of Control Purchase Price equal to 101 % of the principal
amount thereof, together with accrued and unpaid interest, if any, to the Change
of Control Payment Date.
14. Successors.
When a successor assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor will be released
from those obligations.
15. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25 % in aggregate value of the Notes then outstanding
may declare all the Notes to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of Notes may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee may
require indemnity satisfactory to it before it enforces the Indenture or the
Notes. Subject to certain limitations, Holders of a majority in aggregate value
of the Notes then outstanding may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Holders of Notes notice of any
continuing Default or Event of Default (except a Default in payment of
principal, premium, if any, or interest, including a Default at any Maturity
Date), if it determines that withholding notice is in their interest.
B-6
101
16. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, past, present or future, of the Company or any of its Subsidiaries or
any successor corporation shall have any liability for any obligation of the
Company or such Subsidiary under the Notes or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation.
Each Holder of a Note by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes.
17. Authentication.
The Note evidenced by this Unit shall not be valid until the
Trustee or authenticating agent signs the certificate of authentication on the
other side of this Unit.
18. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Note or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
19. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Notes and the Units as a convenience to the holders of the
Notes and holders of the Units. No representation is made as to the accuracy of
such numbers as printed on the Notes or the Units and reliance may be placed
only on the other identification numbers printed thereon and hereon.
20. Holders' Compliance with Registration Rights Agreement.
Each Holder of a Note evidenced by this Unit, by his
acceptance thereof, acknowledges and agrees to the provisions of the
Registration Rights Agreement, dated as of December 30, 1997, between the
Company and ▇▇▇▇▇▇▇▇▇ & Company, Inc. (the "Registration Rights Agreement"),
including but not limited to the obligations of the Holders with respect to a
registration and the indemnification of the Company and the Purchasers (as
defined therein) to the extent provided therein.
The Company shall furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to: TransAmerican Refining Corporation, ▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
21. Ranking.
Payments of principal, premium, if any, interest on and
Liquidated Damages with respect to, the Notes is subordinated, to the extent set
forth in the Indenture, to the prior payment of all Senior Debt.
B-7
102
TRANSAMERICAN REFININGCORPORATION
DEPOSIT OF WARRANTS TO PURCHASE COMMON STOCK OF TRANSAMERICAN REFINING
CORPORATION
Under the terms of the Warrant Agreement, and until such time as the
Holder of this Unit shall have surrendered this Unit to the Warrant Agent for
the exchange of this Unit, in whole or in part, for one or more Warrant
Certificates (as defined in the Warrant Agreement) and one or more Notes of a
like aggregate principal amount and of authorized denominations, the Holder of
this Unit is for each Unit evidenced by this certificate, the beneficial owner
of 13.344257 Warrants expiring June 30, 2003, entitling the holder thereof
initially to purchase 13.344257 shares of Common Stock, par value $0.01 per
share (the "Common Stock"), of the Company (subject to adjustment as provided in
the Warrant Agreement).
The Company has deposited with the Warrant Agent, as custodian for
Holders of Units, certificates for such Warrants. Prior to the exchange of this
Unit for one or more Warrant Certificates and one or more Notes, beneficial
ownership of such Warrants is transferable only by the transfer of this Unit
pursuant to the Indenture. After such exchange, ownership of a Warrant is
transferable only by the transfer of the certificate representing such Warrant
in accordance with the provisions of the Warrant Agreement.
By accepting a Unit, each Holder of this Unit shall be bound by all of
the terms and provisions of the Warrant Agreement (a copy of which is available
on request to the Company or the Warrant Agent) as fully and effectively as if
such Holder had signed the same.
B-8
103
ELECTION TO EXERCISE WARRANTS
The undersigned registered Holder of this Unit hereby irrevocably
elects to exercise Warrants (evidenced by Warrant Certificates deposited with
the Warrant Agent the beneficial ownership of which is evidenced by this Unit)
representing the right to receive ___ shares of Common Stock, and in payment of
the Warrant Price (as defined in the Warrant Agreement) the undersigned herewith
tenders payment in money of the United States of America or by certified or
official bank check in lawful money of the United States of America to the order
of TransAmerican Refining Corporation in the amount of $__________. The
undersigned requests that a certificate representing the Common Stock issuable
upon exercise of such Warrants be registered in the name of
__________________________ whose address is ___________________________ and that
such certificate be delivered to ________________ whose address is
_________________________. All payments to be made in lieu of issuing a
fractional share should be made by check payable to
__________________________________ whose address is __________________________.
The undersigned hereby irrevocably instructs the Warrant Agent (A) to
deliver this Note to the Trustee pursuant to the provisions of the Indenture
with instructions to issue in the name of the registered Holder a Note in
principal amount equal to the principal amount of the Note evidenced by this
Unit; (B) to issue in the name of the undersigned registered Holder a Warrant
Certificate representing the number of Warrants equal to the difference between
(x) the number of Warrants represented by this Unit and (y) the Warrants
exercised hereby on behalf of the undersigned registered Holder; and (C) as
custodian of the Warrants on behalf of such registered Holder, to cause such
Warrants to be exercised on behalf of the undersigned Holder as provided in the
Warrant Agreement.
Dated:
Name of Holder of this Note:
------------------------------------
Address:
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Signature:
--------------------------
[Note: the above signature must correspond with the name as written upon the
face of this Unit in every particular, without alteration or enlargement
whatever.]
B-9
104
ASSIGNMENT
I or we assign this Unit to:
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(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying number of
assignee:
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and irrevocably appoint agent
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to transfer this Unit on the books of the
Company. The agent may substitute another to act
for him.
Dated:
--------------------
Signature:
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(Sign exactly as name appears on the other side of this Unit)
B-10
105
EXCHANGE
I or we assign the Note evidenced by this Unit to:
TransAmerican Energy Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
I.R.S. Employer Identification No.: ▇▇-▇▇▇▇▇▇▇
and irrevocably appoint ______________________ agent to transfer the Note
evidenced by this Unit on the books of the Company. The agent may substitute
another to act for him.
Dated:
-----------------------
Signature:
-----------------------------------------------------
(Sign exactly as name appears on the other side of this Unit)
B-11
106
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have the Note evidenced by this Unit
purchased by the Company pursuant to Section 4.14 or Article XI of the
Indenture, check the appropriate box below:
[ ] Section 4.14 [ ] Article XI
If you want to elect to have only part of the Note evidenced
by this Unit purchased by the Company pursuant to Section 4.14 or Article XI of
the Indenture, as the case may be, state the amount you want to be purchased:
$
------------
Dated:
--------------------
Signature:
------------------------------------
(Sign exactly as your name appears
on the other side of this Unit)
Your Social Security or Tax Identification Number:
------------------
Signature Guarantee***:
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***NOTICE: The signature must be guaranteed by an institution which is a member
of one of the following recognized signature guarantee programs:
(1) The Securities Transfer Agent Medallion Program (STAMP)
(2) The New York Stock Exchange Medallion Program (MSP)
(3) The Stock Exchange Medallion Program (SEMP)
B-12
107
EXHIBIT C
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION
OF TRANSFER OF NOTES
Re: [Series A] [Series B] 16% Senior Subordinated Notes due 2003 (the
"Notes") of TransAmerican Refining Corporation
This Certificate relates to $ principal amount of
Notes held in [ ] book-entry or [ ] definitive form by
------------------------
(the "Transferor").
The Transferor, by written order, has requested the Trustee:
[ ] to deliver in exchange for its beneficial interest in the Global
Note held by the depository, a Note or Notes in definitive,
registered form of authorized denominations and an aggregate
principal amount equal to its beneficial interest in such Global
Note (or the portion thereof indicated above); or
[ ] to exchange or register the transfer of a Note or Notes. In
connection with such request and in respect of each such Note, the
Transferor does hereby certify that Transferor is familiar with the
Indenture relating to the above captioned Notes and, the transfer
of this Note does not require registration under the Securities Act
of 1933, as amended (the "Securities Act") because such Note:
[ ] is being acquired for the Transferor's own account, without
transfer;
[ ] is being transferred pursuant to an effective registration
statement;
[ ] is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act), in reliance on such
Rule 144A;
[ ] is being transferred pursuant to an exemption from registration in
accordance with Rule 904 under the Securities Act;**
[ ] is being transferred pursuant to Rule 144 under the Securities
Act;** or
[ ] is being transferred pursuant to another exemption from the
registration requirements of the Securities Act (explain:
_______________________________ ). "
---------------------------------
[INSERT NAME OF TRANSFEROR]
By:
------------------------
Date:
---------------------
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* Check applicable box.
** If the box is checked, this certificate must be accompanied by an
opinion of counsel to the effect that such transfer is in compliance
with the Securities Act.
C-1