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Exhibit 4.3
INDENTURE dated as of ____________ ___, 1997 among Lomak
Petroleum, Inc., a Delaware corporation (the "Company"), as issuer, the
Subsidiary Guarantors (as hereinafter defined) as guarantors and Fleet National
Bank, as trustee (the "Trustee").
The Company, the Subsidiary Guarantors and the Trustee agree
as follows for the benefit of each other and for the equal and ratable benefit
of the Holders of the ___% Senior Subordinated Notes due 2007 of the Company
(the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.1. Definitions.
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"Acquired Debt" means, with respect to any specified Person
(i) Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Adjusted Consolidated Net Tangible Assets" means (without
duplication), as of the date of determination, (i) the sum of (a) discounted
future net revenues from proved oil and gas reserves of the Company and its
Restricted Subsidiaries calculated in accordance with the Commission's
guidelines before any state or federal income taxes, with no less than 80% of
the discounted future net revenues estimated by one or more nationally
recognized firms of independent petroleum engineers in a reserve report prepared
as of the end of the Company's most recently completed fiscal year, as increased
by, as of the date of determination, the estimated discounted future net
revenues from (1) estimated proved oil and gas reserves acquired since the date
of such year-end reserve report, and (2) estimated oil and gas reserves
attributable to upward revisions of estimates of proved oil and gas reserves
since the date of such year-end reserve report due to exploration, development
or exploitation activities, in each case calculated in accordance with the
Commission's guidelines (utilizing the prices utilized in such year-end reserve
report) increased by the accretion of the discount from the date of the reserve
report to the date of determination, and decreased by, as of the date of
determination, the estimated discounted future net revenues from (3) estimated
proved oil and gas reserves produced or disposed of since the date of such
year-end reserve report and (4) estimated oil and gas reserves attributable to
downward revisions of estimates of proved oil and gas reserves since the date of
such year-end reserve report due to changes in geological conditions or other
factors which would, in accordance with standard industry
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practice, cause such revisions, in each case calculated in accordance with the
Commission's guidelines (utilizing the prices utilized in such year-end reserve
report); provided that, in the case of each of the determinations made pursuant
to clause (1) through (4), such increases and decreases shall be as estimated by
the Company's petroleum engineers, unless in the event that there is a Material
Change as a result of such acquisitions, dispositions or revisions, then the
discounted future net revenues utilized for purposes of this clause (i)(a) shall
be confirmed in writing by one or more nationally recognized firms of
independent petroleum engineers, (b) the capitalized costs that are attributable
to oil and gas properties of the Company and its Restricted Subsidiaries to
which no proved oil and gas reserves are attributable, based on the Company's
books and records as of the date no earlier than the date of the Company's
latest annual or quarterly financial statements, (c) the Net Working Capital on
a date no earlier than the date of the Company's latest annual or quarterly
financial statements and (d) the greater of (1) the net book value on a date no
earlier than the date of the Company's latest annual or quarterly financial
statements or (2) the book value of other tangible assets (including, without
duplication, investments in unconsolidated Restricted Subsidiaries) of the
Company and its Restricted Subsidiaries, as of the date no earlier than the date
of the Company's latest annual or quarterly financial statements, minus (ii) the
sum of (a) minority interests, (b) any gas balancing liabilities of the Company
and its Restricted Subsidiaries reflected in the Company's latest audited
financial statements and (c)the discounted future net revenues, calculated in
accordance with the Commission's guidelines, attributable to reserves subject to
Dollar-Denominated Production Payments which, based on the estimates of
production and price assumptions included in determining the discounted future
net revenues specified in (i)(a) above, would be necessary to fully satisfy the
payment obligations of the Company and its Restricted Subsidiaries with respect
to Dollar-Denominated Production Payments on the schedules specified with
respect thereto. If the Company changes its method of accounting from the
successful efforts method to the full cost method or a similar method of
accounting, "Adjusted Consolidated Net Tangible Assets" will continue to be
calculated as if the Company was still using the successful efforts method of
accounting. At December 31, 1996 the Adjusted Consolidated Net Tangible Assets
was $1.1 billion.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or otherwise;
provided that beneficial
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ownership of 10% or more of the voting securities of a Person
shall be deemed to be control.
"Agent" means any Registrar, Paying Agent or
co-registrar.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition (but excluding the creation of a Lien) of any assets including,
without limitation, by way of a sale and leaseback; provided that the sale,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company and its Subsidiaries taken as a whole shall be governed by
Sections 4.13 and/or 5.1 hereof and not by Section 4.10 hereof), and (ii) the
issuance or sale by the Company or any of its Restricted Subsidiaries of Equity
Interests of any of the Company's Subsidiaries (including the sale by the
Company or a Restricted Subsidiary of Equity Interests in an Unrestricted
Subsidiary), in the case of either clause (i) or (ii), whether in a single
transaction or a series of related transactions (a) that have a fair market
value in excess of $5.0 million or (b) for net proceeds in excess of $5.0
million. Notwithstanding the foregoing, the following shall not be deemed to be
Asset Sales: (1) a transfer of assets by the Company to a Wholly Owned
Restricted Subsidiary of the Company or by a Wholly Owned Restricted Subsidiary
of the Company to the Company or to another Wholly Owned Restricted Subsidiary
of the Company, (2) an issuance of Equity Interests by a Wholly Owned Restricted
Subsidiary of the Company to the Company or to another Wholly Owned Restricted
Subsidiary of the Company, (3) a Permitted Investment or a Restricted Payment
that is permitted by Section 4.7, (4) the abandonment, farm-out, lease or
sublease of undeveloped oil and gas properties in the ordinary course of
business, (5) the trade or exchange by the Company or any Restricted Subsidiary
of the Company of any oil and gas property owned or held by the Company or such
Restricted Subsidiary for any oil and gas property owned or held by another
Person, which the Board of Directors of the Company determines in good faith to
be of approximately equivalent value, (6) the trade or exchange by the Company
or any Subsidiary of the Company of any oil and gas property owned or held by
the Company or such Subsidiary for Equity Interests in another Person engaged
primarily in the Oil and Gas Business which, together with all other such trades
or exchanges (to the extent excluded from the definition of Asset Sale pursuant
to this clause (6)) since the date of the Indenture, do no exceed 5% of Adjusted
Consolidated Net Tangible Assets determined after such trade or exchange and (7)
the sale or transfer of hydrocarbons or other mineral products or other
inventory or surplus or obsolete equipment in the ordinary course of business.
"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) of the
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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 Code" means Title 11 of the United States
Code, as amended.
"Board of Directors" means the Board of Directors of the
Company or a Subsidiary Guarantor, as applicable, or any authorized committee of
such Board of Directors.
"Borrowing Base" means, as of any date, the aggregate amount
of borrowing availability as of such date under all Credit Facilities that
determine availability on the basis of a borrowing base or other asset-based
calculation.
"Business Day" means any day other than a Legal
Holiday.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation,
corporate stock, (ii) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership, partnership
interests (whether general or limited), (iv) in the case of a limited liability
company or similar entity, any membership or similar interests therein and (v)
any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, the
issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii)
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 six months from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of six months or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any lender party to the
Credit Agreement or with any domestic commercial bank having capital and surplus
in excess of $500 million and a ▇▇▇▇▇▇▇▇ Bank Watch Rating of "B" or better,
(iv) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (ii) and (iii) above
entered into with any financial institution meeting the qualifications specified
in clause (iii) above, (v) commercial paper having a rating of at least P1 from
▇▇▇▇▇'▇ or a rating of at least A1 from S&P, and (vi) investments in money
market or other mutual funds
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substantially all of whose assets comprise securities of the types described in
clauses (ii) through (v) above.
"Change of Control" means the occurrence of any of the
following: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and its
Subsidiaries taken as a whole to any "person" or group of related "persons" (as
such terms are used in Section 13(d)(3) of the Exchange Act), (ii) the adoption
of a plan relating to the liquidation or dissolution of the Company, (iii) the
consummation of any transaction (including, without limitation, any purchase,
sale, acquisition, disposition, merger or consolidation) the result of which is
that any "person" (as defined above) or group of related "persons" becomes the
"beneficial owner" (as such term is defined in Rule 13d-3 and Rule 13d-5 under
the Exchange Act) of more than 40% of the aggregate voting power of all classes
of Capital Stock of the Company having the right to elect directors under
ordinary circumstances or (iv) the first day on which a majority of the members
of the Board of Directors of the Company are not Continuing Directors.
"Closing Date" the date of the closing of the sale of
the Notes offered pursuant to the Offering.
"Cometra Acquisition" means the acquisition by the Company of
certain oil and gas properties from American Cometra, Inc. pursuant to an
agreement, dated December 31, 1996, between the Company and American Cometra,
Inc.
"Commission" means the Securities and Exchange
Commission.
"Consolidated Cash Flow" means, with respect to any Person for
any period, the Consolidated Net Income of such Person and its Restricted
Subsidiaries for such period plus (i) an amount equal to any extraordinary loss
plus any net loss realized in connection with an Asset Sale (together with any
related provision for taxes), to the extent such losses were included in
computing such Consolidated Net Income, plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Interest Rate Hedging
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Agreements), to the extent that any such expense was included in computing such
Consolidated Net Income, plus (iv) depreciation, depletion and amortization
expenses (including amortization of goodwill and other intangibles) for such
Person and its Restricted Subsidiaries for such period to the extent that such
depreciation, depletion and amortization expenses were included in computing
such Consolidated Net Income, plus (v) exploration expenses for such Person and
its Restricted Subsidiaries for such period to the extent such exploration
expenses were included in computing such Consolidated Net Income, plus (vi)
other non-cash charges (excluding any such non-cash charge to the extent that it
represents an accrual of or reserve for cash charges in any future period or
amortization of a prepaid cash expense that was paid in a prior period) of such
Person and its Restricted Subsidiaries for such period to the extent that such
other non cash charges were included in computing such Consolidated Net Income,
in each case, on a consolidated basis and determined in accordance with GAAP.
Notwithstanding the foregoing, the provision for taxes on the income or profits
of, and the depreciation, depletion and amortization and other non-cash charges
and expenses of, a Restricted Subsidiary of the referent Person shall be added
to Consolidated Net Income to compute Consolidated Cash Flow only to the extent
(and in same proportion) that the Net Income of such Restricted Subsidiary was
included in calculating the Consolidated Net Income of such Person and only if a
corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior
governmental approval (that has not been obtained), and without direct or
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Restricted Subsidiary or its stockholders.
"Consolidated Net Income" means, with respect to any Person
for any period, the aggregate of the Net Income of such Person and its
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that (i) the Net Income (but not loss) of any Person that is
not a Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or a Wholly Owned Restricted
Subsidiary thereof, (ii) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to that Restricted Subsidiary or its
stockholders, (iii) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition shall
be excluded and (iv) the
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cumulative effect of a change in accounting principles shall be
excluded.
"Consolidated Net Worth" means the total of the amounts shown
on the balance sheet of the Company and its consolidated Restricted
Subsidiaries, determined on a consolidated basis in accordance with GAAP, as of
the end of the most recent fiscal quarter of the Company ending prior to the
taking of any action for the purpose of which the determination is being made
and for which internal financial statements are available (but in no event
ending more than 135 days prior to the taking of such action), as (i) the par or
stated value of all outstanding Capital Stock of the Company, plus (ii) paid-in
capital or capital surplus relating to such Capital Stock, plus (iii) any
retained earnings or earned surplus, less (a) any accumulated deficit and (b)
any amounts attributable to Disqualified Stock.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of original issuance of the Notes or (ii) was
nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of such Board at the
time of such nomination.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.2 hereof or such other address as
to which the Trustee may give notice to the Company.
"Credit Agreement" means that certain Credit Agreement, dated
as of February 14, 1997, by and among the Company, the Subsidiaries, BankOne, as
administrative agent and as a lender, The Chase Manhattan Bank, N.A., as
syndication agent and as a lender, NationsBank, as documentation agent and as a
lender, and certain other banks, financial institutions and other entities, as
lenders, providing for up to $400.0 million of Indebtedness, including any
related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as amended, restated,
modified, renewed, refunded, replaced or refinanced, in whole or in part, from
time to time, whether or not with the same lenders or agents.
"Credit Facilities" means, with respect to the Company, one or
more debt facilities (including, without limitation, the Credit Agreement) or
commercial paper facilities with banks or other institutional lenders providing
for revolving credit loans, term loans, production payment financing,
receivables financing (including through the sale of receivables to such lenders
or to special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time.
Indebtedness under Credit Facilities outstanding on the date on which the
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Notes are first issued and authenticated under this Indenture (after giving
effect to the use of proceeds thereof) shall be deemed to have been incurred on
such date in reliance on the exception provided by clause (b) of the definition
of Permitted Indebtedness set forth in Section 4.9 hereof.
"Default" means any event that is or with the passage of time
or the giving of notice or both would be an Event of Default.
"Depository" means, with respect to the Notes issued in the
form of one or more Global Notes, The Depository Trust Company or another Person
designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
"Designated Senior Debt" means (i) the Credit Agreement and
(ii) any other Senior Debt permitted under this Indenture the principal amount
of which is $25 million or more and that has been designated by the Company as
"Designated Senior Debt."
"Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the Holder thereof, in whole or in part, on or prior
to the date that is 91 days after the date on which the Notes mature.
"Dollar-Denominated Production Payments" means production
payment obligations recorded as liabilities in accordance with GAAP, together
with all undertakings and obligations in connection therewith.
"Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Fixed Charge Coverage Ratio" means with respect to any Person
for any period, the ratio of the Consolidated Cash Flow of such Person for such
period to the Fixed Charges of such Person for such period. In the event that
the Company or any of its Restricted Subsidiaries incurs, assumes, guarantees or
redeems Indebtedness (other than revolving credit borrowings) or issues
preferred stock subsequent to the commencement of the period for which the Fixed
Charge Coverage Ratio is being calculated but prior to the date on which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
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to such incurrence, assumption, guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for
purposes of making the computation referred to above, (i) acquisitions that have
been made by the referent Person or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date (including, without
limitation, any acquisition to occur on the Calculation Date) shall be deemed to
have occurred on the first day of the four-quarter reference period and
Consolidated Cash Flow for such reference period shall be calculated without
giving effect to clause (iii) of the proviso set forth in the definition of
Consolidated Net Income, (ii) the net proceeds of Indebtedness incurred or
Disqualified Stock issued by the referent Person pursuant to the first paragraph
of Section 4.9 hereof during the four-quarter reference period or subsequent to
such reference period and on or prior to the Calculation Date shall be deemed to
have been received by the referent Person or any of its Restricted Subsidiaries
on the first day of the four-quarter reference period and applied to its
intended use on such date, (iii) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded and
(iv) the Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such Fixed Charges shall not be obligations of the referent
Person or any of its Restricted Subsidiaries following the Calculation Date.
"Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of (i) the consolidated interest expense
of such Person and its Restricted Subsidiaries for such period, whether paid or
accrued (including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Interest Rate Hedging Agreements); (ii) the consolidated interest expense of
such Person and its Restricted Subsidiaries that was capitalized during such
period; (iii) any interest expense on Indebtedness of another Person that is
guaranteed by such Person or any of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or any of its Restricted Subsidiaries (whether or
not such guarantee or Lien is called upon) and (iv) the product of (a) all cash
dividend payments (and non-cash dividend payments in the case of a Person that
is a Restricted
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Subsidiary) on any series of preferred stock of such Person or any of its
Restricted Subsidiaries, times (b) a fraction, the numerator of which is one and
the denominator of which is one minus the then current combined federal, state
and local statutory tax rate of such Person, expressed as a decimal, in each
case, on a consolidated basis and in accordance with GAAP.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect from time to time.
"Government Securities" means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such Government
Security or a specific payment of principal of or interest on any such
Government Security held by such custodian for the account of the holder of such
depository receipt; provided, that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the Government Security or the specific payment of principal of or interest on
the Government Security evidenced by such depository receipt.
"guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"Guarantee" means each of the Guarantees of the Notes
by the Subsidiary Guarantors hereunder.
"Holder" means a Person in whose name a Note is
registered on the Registrar's books.
"Indebtedness" means, with respect to any Person, without
duplication, (a) any indebtedness of such Person, whether or not contingent, (i)
in respect of borrowed money, (ii) evidenced by bonds, notes, debentures or
similar instruments, (iii) evidenced by letters of credit (or reimbursement
agreements
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in respect thereof) or banker's acceptances, (iv) representing Capital Lease
Obligations, (v) representing the balance deferred and unpaid of the purchase
price of any property, except any such balance that constitutes an accrued
expense or trade payable, (vi) representing any obligations in respect of
Interest Rate Hedging Agreements or Oil and Gas Hedging Contracts, and (vii) in
respect of any Production Payment, (b) all indebtedness of others secured by a
Lien on any asset of such Person (whether or not such indebtedness is assumed by
such Person, (c) obligations of such Person in respect of production imbalances,
(d) Attributable Debt of such Person and (e) to the extent not otherwise
included in the foregoing, the guarantee by such Person of any indebtedness of
any other Person, provided that the indebtedness described in clauses (a)(i),
(ii), (iv) and (v) shall be included in this definition of Indebtedness only if,
and to the extent that, the indebtedness described in such clauses would appear
as a liability upon a balance sheet of such Person prepared in accordance with
GAAP.
"Indenture" means this Indenture, as amended or
supplemented from time to time.
"Interest Rate Hedging Agreements" means, with respect to any
Person, the obligations of such Person under (i) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affiliates) in the form
of direct or indirect loans (including guarantees of Indebtedness or other
obligations, but excluding trade credit and other ordinary course advances
customarily made in the oil and gas industry), advances or capital contributions
(excluding commission, travel and similar advances to officers and employees
made in the ordinary course of business), purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities, together
with all items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP; provided that the following shall not
constitute Investments: (i) an acquisition of assets, Equity Interests or other
securities by the Company for consideration consisting of common equity
securities of the Company, (ii) Interest Rate Hedging Agreements entered into in
accordance with the limitations set forth in clause (g) of the definition of
"Permitted Indebtedness" set forth in Section 4.9 hereof, (iii) Oil and Gas
Hedging Contracts entered into in accordance with the limitations set forth in
clause (h) of the definition of "Permitted Indebtedness" set forth in Section
4.9 hereof and (iv) endorsements of negotiable instruments and documents in the
ordinary course of business. If the Company or any Restricted Subsidiary of the
Company sells or otherwise disposes of any Equity Interests of any direct or
indirect Restricted Subsidiary
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of the Company such that, after giving effect to any such sale or disposition,
such Person is no longer a Subsidiary of the Company, the Company shall be
deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Equity Interests of such Subsidiary not
sold or disposed of.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York, the City of Chicago or at a place
of payment are authorized by law, regulation or executive order to remain
closed. If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law (including any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to sell or give a
security interest in and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction other than a precautionary financing statement with respect to a
lease not intended as a security agreement).
"Material Change" means an increase or decrease (excluding
changes that result solely from changes in prices) of more than 20% during a
fiscal quarter in the estimated discounted future net cash flows from proved oil
and gas reserves of the Company and its Restricted Subsidiaries, calculated in
accordance with clause (i)(a) of the definition of Adjusted Consolidated Net
Tangible Assets; provided, however, that the following will be excluded from the
calculation of Material Change: (i) any acquisitions during the quarter of oil
and gas reserves that have been estimated by one or more nationally recognized
firms of independent petroleum engineers and on which a report or reports exist
and (ii) any disposition of properties existing at the beginning of such quarter
that have been disposed of as provided in Section 4.10 hereof.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with (a) any Asset Sale (including,
without limitation, dispositions pursuant to sale and leaseback transactions) or
(b) the disposition of any securities by such Person or any of its Restricted
Subsidiaries or the
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extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries and (ii) any extraordinary or nonrecurring gain (but not loss),
together with any related provision for taxes on such extraordinary or
nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale, but
excluding cash amounts placed in escrow, until such amounts are released to the
Company), net of the direct costs relating to such Asset Sale (including,
without limitation, legal, accounting and investment banking fees and expenses,
and sales commissions) and any relocation expenses incurred as a result thereof,
taxes paid or payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements), amounts
required to be applied to the repayment of Indebtedness (other than Indebtedness
under any Credit Facility) secured by a Lien on the asset or assets that were
the subject of such Asset Sale and any reserve for adjustment in respect of the
sale price of such asset or assets established in accordance with GAAP and any
reserve established for future liabilities.
"Net Working Capital" means (i) all current assets of the
Company and its Restricted Subsidiaries, minus (ii) all current liabilities of
the Company and its Restricted Subsidiaries, except current liabilities included
in Indebtedness, in each case as set forth in financial statements of the
Company prepared in accordance with GAAP.
"Non-Recourse Debt" means Indebtedness (i) as to which neither
the Company nor any of its Restricted Subsidiaries (a) provides any guarantee or
credit support of any kind (including any undertaking, guarantee, indemnity or
agreement or instrument that would constitute Indebtedness) or (b) is directly
or indirectly liable (as a guarantor or otherwise); (ii) no default with respect
to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any of its Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity; and (iii) the explicit terms of which provide that there is
no recourse against any of the assets of the Company or its Restricted
Subsidiaries.
"Note Custodian" means the Trustee or the Registrar, as
custodian with respect to the Notes in global form, or any successor entity
thereto or any entity acting as custodian with respect to Notes in global form.
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"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Notes by the
Company.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Controller, the Secretary, the Assistant Secretary or any Vice-President of
such Person.
"Officers' Certificate" means a certificate signed on behalf
of the Company, by two Officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the treasurer or
the principal accounting officer of the Company, that meets the requirements of
Section 12.5 hereof.
"Oil and Gas Business" means (i) the acquisition, exploration,
development, operation and disposition of interests in oil, gas and other
hydrocarbon properties, (ii) the gathering, marketing, distribution, treating,
processing, storage, selling and transporting of any production from such
interests or properties, (iii) any business relating to exploration for or
development, production, treatment, processing, storage, transportation or
marketing of oil, gas and other minerals and products produced in association
therewith and (iv) any activity that is ancillary to or necessary or appropriate
for the activities described in clauses (i) through (iii) of this definition.
"Oil and Gas Hedging Contracts" means any oil and gas purchase
or hedging agreement, and other agreement or arrangement, in each case, that is
designed to provide protection against oil and gas price fluctuations.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
12.5 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary Guarantor or the Trustee.
"Pari Passu Indebtedness" means indebtedness which ranks pari
passu in right of payment to the Notes.
"Permitted Investments" means (a) any Investment in the
Company or in a Wholly Owned Restricted Subsidiary of the Company; (b) any
Investment in Cash Equivalents or securities issued or directly and fully
guaranteed or insured by the United States government or any agency or
instrumentality thereof having
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maturities of not more than one year from the date of acquisition; (c) any
Investment by the Company or any Restricted Subsidiary of the Company in a
Person if, as a result of such Investment and any related transactions that at
the time of such Investment are contractually mandated to occur, (i) such Person
becomes a Wholly Owned Restricted Subsidiary of the Company or (ii) such Person
is merged, consolidated or amalgamated with or into, or transfers or conveys all
or substantially all of its assets to, or is liquidated into, the Company or a
Wholly Owned Restricted Subsidiary of the Company; (d) any Investment made as a
result of the receipt of non-cash consideration from an Asset Sale that was made
pursuant to and in compliance with Section 4.10 hereof; (e) other Investments in
any Person or Persons having an aggregate fair market value (measured on the
date each such Investment was made and without giving effect to subsequent
changes in value), when taken together with all other Investments made pursuant
to this clause (e) that are at the time outstanding not to exceed $10.0 million;
(f) any Investment acquired by the Company in exchange for Equity Interests in
the Company (other than Disqualified Stock), (g) shares of Capital Stock
received in connection with any good faith settlement of a bankruptcy proceeding
involving a trade creditor, (h) entry into operating agreements, joint ventures,
partnership agreements, working interests, royalty interests, mineral leases,
processing agreements, farm-out agreements, contracts for the sale,
transportation or exchange of oil and natural gas, unitization agreements,
pooling arrangements, area of mutual interest agreements, production sharing
agreements or other similar or customary agreements, transactions, properties,
interest or arrangements, and Investments and expenditures in connection
therewith or pursuant thereto, in each case made or entered into in the ordinary
course of the Oil and Gas Business, excluding, however, Investments in
corporations other than any Investment received pursuant to the Asset Sale
provision and (i) the acquisition of any Equity Interests pursuant to a
transaction of the type described in clause (6) of the exclusion from the
definition of "Asset Sale".
"Permitted Liens" means (i) Liens securing Indebtedness of a
Subsidiary or Liens securing Senior Debt, in each case, that is outstanding on
the date of issuance of the Notes (after giving effect to the Cometra
Acquisition, the related financing transactions and the application of the
proceeds therefrom) and Liens securing Senior Debt that are permitted by the
terms of the Indenture to be incurred, (ii) Liens in favor of the Company, (iii)
Liens on property or assets existing at the time of acquisition thereof by the
Company or any Subsidiary of the Company and Liens on property or assets of a
Subsidiary existing at the time it became a Subsidiary; provided, that such
Liens were in existence prior to the contemplation of the acquisition and do not
extend to any assets other than the acquired property, (iv) Liens incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance or other kinds of social security, or to
secure the
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payment or performance of tenders, statutory or regulatory obligations, surety
or appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business (including lessee or operator
obligations under statutes, governmental regulations or instruments related to
the ownership, exploration and production of oil, gas and minerals on state or
federal lands or waters), (v) Liens existing on the date of the Indentures
(after giving effect to the Cometra Acquisition, the related financing
transactions and the application of proceeds therefrom), (vi) Liens for taxes,
assessments or governmental charges or claims that are not yet delinquent or
that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded; provided, that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor, (vii) statutory liens of landlords, mechanics, suppliers,
vendors, warehousemen, carriers or other like Liens arising in the ordinary
course of business, (viii) judgment Liens not giving rise to an Event of Default
so long as any appropriate legal proceeding that may have been duly initiated
for the review of such judgment shall not have been finally terminated or the
period within which such proceeding may be initiated shall not have expired,
(ix) Liens on, or related to, properties or assets to secure all or part of the
costs incurred in the ordinary course of the Oil and Gas Business for the
exploration, drilling, development or operation thereof, (x) Liens in pipelines
or pipeline facilities that arise under operation of law, (xi) Liens arising
under operating agreements, joint venture agreements, partnership agreements,
oil and gas leases, farm-out agreements, division orders, contracts for the
sale, transportation or exchange of oil or natural gas, unitization and pooling
declarations and agreements, area of mutual interest agreements and other
agreements that are customary in the Oil and Gas Business, (xii) Liens reserved
in oil and gas mineral leases for bonus and rental payments and for compliance
with the terms of such leases, (xiii) Liens securing the Notes and (xiv) Liens
not otherwise permitted by clauses (i) through (xiii) that are incurred in the
ordinary course of business of the Company or any Subsidiary of the Company with
respect to obligations that do not exceed $5.0 million at any one time
outstanding.
"Permitted Refinancing Debt" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness (other than Indebtedness incurred under a Credit
Facility) of the Company or any of its Restricted Subsidiaries; provided that:
(i) the principal amount of such Permitted Refinancing Debt does not exceed the
principal amount of the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of reasonable expenses incurred in
connection therewith); (ii) such Permitted Refinancing Debt has a final maturity
date on or later than the final maturity date of, and has a Weighted
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Average Life to Maturity equal to or greater than the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; (iii) if the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Debt has a final maturity date later than
the final maturity date of, and is subordinated in right of payment to, the
Notes on terms at least as favorable taken as a whole, to the Holders of the
Notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and (iv) such
Indebtedness is incurred either by the Company or by the Restricted Subsidiary
who is the obligor on the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"Production Payments" means Dollar-Denominated
Production Payments and Volumetric Production Payments,
collectively.
"Repurchase Offer" means an offer made by the Company to
purchase all or any portion of a Holder's Notes pursuant to Section 4.10 or 4.13
hereof.
"Responsible Officer" when used with respect to the Trustee,
means any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Investment" means an Investment other than
a Permitted Investment.
"Restricted Subsidiary" means any direct or indirect
Subsidiary of the Company that is not an Unrestricted Subsidiary.
"S&P" means Standard & Poor's Ratings Group and its
successors.
"Securities Act" means the Securities Act of 1933, as
amended.
"Significant Subsidiary" means each Subsidiary that for
the most recent fiscal year of such Subsidiary had consolidated
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revenues greater than $10.0 million or as at the end of such fiscal year, had
assets greater than $10.0 million.
"Subordinated Indebtedness" means any Indebtedness of the
Company or any Restricted Subsidiary (whether outstanding on the date of the
issuance of the Notes or thereafter incurred) which is subordinate or junior in
right of payment to the Notes pursuant to a written agreement.
"Subsidiary" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner or
the managing general partner of which is such Person or a Subsidiary of such
Person or (b) the only general partners of which are such Person or of one or
more Subsidiaries of such Person (or any combination thereof).
"Subsidiary Guarantors" means each Restricted Subsidiary of
the Company existing on the date hereof (such subsidiaries being Lomak Operating
Company, Lomak Production Company, Lomak Resources Company, Buffalo Oilfield
Services, Inc., Lomak Energy Services Company, Lomak Energy Company, LPI
Acquisition, Inc., Lomak Production I, L.P., Lomak Resources, L.L.C. Lomak
Offshore I,L.P., Lomak Pipeline Systems, L.P., Lomak Gathering & Processing
Company and Lomak Gas Company) and any other future Restricted Subsidiary of the
Company and in each case their respective successors and assigns.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date on which this Indenture
is qualified under the TIA.
"Total Assets" means, with respect to any Person, the total
consolidated assets of such Person and its Restricted Subsidiaries, as shown on
the most recent balance sheet of such Person.
"Trustee" means the party named as such in the preamble to
this Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Company which at the time of determination shall be an Unrestricted Subsidiary
(as designated by the Board of Directors of the Company, as provided below) and
(ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors of the
Company may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary or a Person becoming a
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Subsidiary through merger or consolidation or Investment therein) to be an
Unrestricted Subsidiary only if: (a) such Subsidiary does not own any Capital
Stock of, or own or hold any Lien on any property of, any other Subsidiary of
the Company which is not a Subsidiary of the Subsidiary to be so designated or
otherwise an Unrestricted Subsidiary; (b) all the Indebtedness of such
Subsidiary shall at the date of designation, and will at all times thereafter
consist of, Non-Recourse Debt; (c) the Company certifies that such designation
was permitted by Section 4.7; (d) such Subsidiary, either alone or in the
aggregate with all other Unrestricted Subsidiaries, does not operate, directly
or indirectly, all or substantially all of the business of the Company and its
Subsidiaries; (e) such Subsidiary does not, directly or indirectly, own any
Indebtedness of or Equity Interest in, and has no Investments in, the Company or
any Restricted Subsidiary; (f) such Subsidiary is a Person with respect to which
neither the Company nor any of its Restricted Subsidiaries has any direct or
indirect obligation (1) to subscribe for additional Equity Interests or (2) to
maintain or preserve such Person's financial condition or to cause such Person
to achieve any specified levels of operating results; and (g) on the date such
Subsidiary is designated an Unrestricted Subsidiary, such Subsidiary is not a
party to any agreement, contract, arrangement or understanding with the Company
or any Restricted Subsidiary with terms substantially less favorable to the
Company than those that might have been obtained from Persons who are not
Affiliates of the Company. Any such designation by the Board of Directors of the
Company shall be evidenced to the Trustee by filing with the Trustee a
resolution of the Board of Directors of the Company giving effect to such
designation and an Officer's Certificate certifying that such designation
complied with the foregoing conditions. If, at any time, any Unrestricted
Subsidiary would fail to meet the foregoing requirements as an Unrestricted
Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of the Indenture and any Indebtedness of such Subsidiary shall be
deemed to be incurred as of such date. The Board of Directors of the Company may
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided,
that (1) immediately after giving effect to such designation, no Default or
Event of Default shall have occurred and be continuing or would occur as a
consequence thereof and the Company could incur at least $1.00 of additional
Indebtedness (excluding Permitted Indebtedness) pursuant to Section 4.9 on a pro
forma basis taking into account such designation and (2) such Subsidiary
executes a Guarantee pursuant to Section 11.4 of this Indenture.
"Volumetric Production Payments" means production payment
obligations recorded as deferred revenue in accordance with GAAP, together with
all undertakings and obligations in connection therewith.
"Weighted Average Life to Maturity" means, when applied
to any Indebtedness at any date, the number of years obtained by
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dividing (i) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof,
by (b) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment, by (ii) the then
outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" means, with respect to
any Person, a Restricted Subsidiary of such Person, all of the outstanding
Capital Stock or other ownership interests of which (other than directors'
qualifying shares) are owned, directly or indirectly, by such Person or by one
or more Wholly Owned Restricted Subsidiaries of such Person.
Section 1.2. Other Definitions.
-----------------
Defined in
Term Section
"Affiliate Transaction"............................................ 4.11
"Asset Sale Offer"................................................. 3.9
"Bankruptcy Law"................................................... 10.2
"Change of Control Offer".......................................... 4.13
"Change of Control Payment"........................................ 4.13
"Change of Control Payment Date"................................... 4.13
"Closing Date"..................................................... 2.1
"Covenant Defeasance".............................................. 8.3
"Custodian"........................................................ 6.1
"DTC".............................................................. 2.3
"Event of Default"................................................. 6.1
"Excess Proceeds".................................................. 4.10
"Global Note" ..................................................... 2.1
"Global Note Holder"............................................... 2.1
"incur"............................................................ 4.9
"Legal Defeasance"................................................. 8.2
"Notice of Default"................................................ 6.1
"Offer Amount"..................................................... 3.9
"Offer Period"..................................................... 3.9
"Paying Agent"..................................................... 2.3
"Payment Blockage Notice".......................................... 10.4
"Payment Default".................................................. 6.1
"Permitted Indebtedness"........................................... 4.9
"Purchase Date".................................................... 3.9
"Registrar"........................................................ 2.3
"Restricted Payments".............................................. 4.7
"Senior Debt"...................................................... 10.2
Section 1.3. Incorporation By Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
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The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means
the Trustee;
"obligor" with respect to the Notes means the Company and with
respect to the Guarantees means the Subsidiary Guarantors and any successor
obligor upon the Notes and the Guarantees, respectively.
All other terms used in this indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by rule enacted by
the Commission under the TIA have the meanings so assigned to them.
Section 1.4. Rules of Construction.
----------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in
the plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement of successor
sections or rules adopted by the Commission from time to time.
ARTICLE 2
THE NOTES
Section 2.1. Form and Dating.
----------------
The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Guarantees of the
Subsidiary Guarantors shall be substantially in the form of Exhibit C hereto,
the terms of which are incorporated in and made part of this indenture. The
Notes may have notations, legends or endorsements required by law,
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stock exchange rule or usage. Each Note shall be dated the date of its issuance
and shall show the date of its authentication. The Notes will be fully
registered as to principal and interest in minimum denominations of $1,000 and
integral multiples of $1,000 in excess thereof.
The Notes offered and sold may be issued initially in the form
of one or more fully registered global Notes (each being called a "Global
Note"), with, or on behalf of, The Depository Trust Company and registered in
the name of Cede & Co., as nominee of the Depository (such nominee being
referred to herein as the "Global Note Holder"), or will remain in the custody
of the Registrar pursuant to the Fast Balance Certificate Agreement between the
Depository and the Registrar and shall bear the legend set forth as Exhibit B.
Except as set forth in Section 2.6, the Global Notes may be transferred, in
whole and not in part, only to another nominee of the Depository or to a
successor of the Depository or its nominee.
The terms and provisions contained in the Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Subsidiary Guarantors and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and (as
to the Trustee, to the extent such terms and provisions pertain to the Trustee)
to be bound thereby.
Notes issued in global form shall be substantially in the form
of Exhibit A attached hereto (including the legend on Exhibit B). Notes issued
in certificated form shall be substantially in the form of Exhibit A attached
hereto (but without including the legend on Exhibit B). Each Global Note shall
represent such of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate amount of outstanding Notes
from time to time endorsed thereon and 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 a 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 or the Note
Custodian, at the direction of 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 the Notes for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Notes and may
be in facsimile form.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.
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A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed
by two Officers, authenticate Notes for original issue up to the aggregate
principal amount of $100,000,000. The aggregate principal amount of Notes
outstanding at any time may not exceed $100,000,000, except as provided in
Section 2.7 hereof.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes 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 the Company or
an Affiliate of the Company.
Section 2.3. Registrar and Paying Agent.
---------------------------
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York where (i) Notes may be presented for
registration of transfer or for exchange ("Registrar") and (ii) Notes may be
presented for payment ("Paying Agent"). The Registrar shall keep a register of
the Notes and of their transfer and exchange. The Company may appoint one or
more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any
additional paying agent. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company shall notify the Trustee in writing of
the name and address of any Agent not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act as
Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company
("DTC")to act as Depository with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.
Section 2.4. Paying Agent to Hold Money in Trust.
------------------------------------
The Company shall require each Paying Agent, including the
Trustee (who shall be deemed to have agreed by its execution of this Indenture),
to agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee (unless the Paying Agent is the Trustee, in which case it
shall hold in trust for the Holders) all money held by the Paying Agent
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for the payment of principal, premium, if any, or interest, on the Notes, and
shall notify the Trustee of any default by the Company or any Subsidiary
Guarantor in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee.
The Company at any time may require a Paying Agent to pay all money held by it
to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other
than the Company or a Subsidiary) shall have no further liability for the money.
If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold
in a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company or a Subsidiary Guarantor, the Trustee shall serve as sole Paying Agent
for the Notes.
Section 2.5. Holder 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 all Holders and shall otherwise comply with TIA ss. 312(a). If the
Trustee is not the Registrar, the Company and/or the Subsidiary Guarantors shall
furnish to the Trustee at least seven Business Days before each interest payment
date and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of the names
and addresses of the Holders of Notes and the Company and the Subsidiary
Guarantors shall otherwise comply with TIA ss. 312(a).
Section 2.6. Transfer and Exchange.
----------------------
Subject to the provisions of Section 2.13, when Notes are
presented to the Registrar with a request to register the transfer of such Notes
or to exchange such Notes for an equal principal amount of Notes of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested if its requirements for such transaction are met;
PROVIDED, HOWEVER, that the Notes surrendered for transfer or exchange shall be
duly endorsed or accompanied by a written instrument of transfer duly executed
by the Holder thereof (or his attorney duly authorized in writing) in form
satisfactory to the Company and to the Registrar. In order to permit
registrations of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Notes at the Registrar's written request. No service
charge shall be made for any registration of transfer or exchange or of
redemption, but the Company may, by notice to the Trustee, 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 other
governmental charge payable upon exchanges or transfers pursuant to Sections
2.2, 2.3, 3.6, 3.7(b) or 3.9). The Registrar shall not be required to register
the transfer of or exchange of any Note (i) during a period beginning at the
opening of business 15 days before the mailing of a notice
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of redemption of Notes and ending at the close of business on the day of such
mailing and (ii) selected for redemption in whole or in part pursuant to Article
Three, except the unredeemed portion of any Note being redeemed in part.
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 such Note for the
purpose of receiving payment of principal of and interest on such Notes, and
neither the Trustee, any Agent nor the Company shall be affected by notice to
the contrary.
Section 2.7. Replacement Notes.
------------------
If any mutilated Note is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon the receipt of a written authentication order of the Company signed by two
Officers of the Company, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company and the Trustee may charge for its expenses in replacing a
Note.
Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
Section 2.8. Outstanding Notes.
------------------
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section as not outstanding. Except as set forth in Section 2.9
hereof, a Note does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.7 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under
Section 4.1 hereof, it ceases to be outstanding and interest on it ceases to
accrue. Notes will also cease to be
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outstanding for certain purposes hereunder as provided in Article
8 hereof.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.9. Treasury Notes.
---------------
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, any Subsidiary Guarantor, or by any Affiliate of the Company or
any Subsidiary Guarantor, shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes that a Trustee
actually knows are registered in the names of the Company, any Subsidiary
Guarantor or any of their Affiliates or are certified as such by the Company in
an Officer's Certificate delivered to the Trustee shall be so disregarded.
When the Company, any Subsidiary Guarantor or any of their
Affiliates repurchases or otherwise acquires Notes, the Company shall notify the
Trustee, in writing, of the aggregate principal amount of such Notes so
repurchased or otherwise acquired. The Trustee may require an Officer's
Certificate listing Notes owned by the Company, any Subsidiary Guarantor or any
of their Affiliates.
Section 2.10. CUSIP Number.
-------------
The Company in issuing the Notes may use a "CUSIP" number, and
if so, the Trustee shall use the CUSIP number in notices of redemption or
exchange as a convenience to Holders; PROVIDED that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes and that reliance may be placed
only on the other identification numbers printed on the Notes.
Section 2.11. Cancellation.
-------------
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all cancelled Notes shall be delivered
to the
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Company. The Company may not issue new Notes to replace Notes
that it has paid or that have been delivered to the Trustee for
cancellation.
Section 2.12. Defaulted Interest.
-------------------
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.1 hereof. 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. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
Section 2.13. Book-Entry Provisions for Global Notes.
---------------------------------------
(a) The Global Notes initially shall (i) be registered in the
name of Cede & Co., as the nominee of The Depository Trust Company, (ii) be
delivered to the Registrar as custodian for such Depository and (iii) bear
legends as set forth in Exhibit B.
(b) Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Note held on their behalf by the Depository, or the Registrar or the Trustee as
its custodian, or under the Global Note, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Note for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depository or
impair, as between the Depository and its Agent Members, the operation of
customary practices governing the exercise of the rights of a Holder of any
Note.
(c) Transfers of Global Notes shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in the Global Notes may be transferred
or exchanged for Certificated Notes in accordance with the rules and procedures
of the Depository. In addition, Certificated Notes shall be transferred to all
beneficial owners in exchange for their beneficial interests in Global Notes if
(i) the Company notifies
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the Registrar that the Depository is unwilling or unable to continue as
Depository for any Global Note and a successor Depository is not appointed by
the Company within 90 days of such notice or (ii) the Company, at its option,
notifies the Registrar in writing that it elects to cause the issuance of Notes
in definitive form under the Indenture or (iii) an Event of Default has occurred
and is continuing and the Registrar has received a request from the Depository
to issue Certificated Notes.
(d) In connection with any transfer or exchange of a portion
of the beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (c), the Registrar shall (if one or more Certificated Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Company
shall execute, and the Trustee shall authenticate and deliver, one or more
Certificated Notes of like tenor and amount.
(e) In connection with the transfer of Global Notes as an
entirety to beneficial owners pursuant to the second sentence of paragraph (c),
the Global Notes shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depository in exchange
for its beneficial interest in the Global Notes, an equal aggregate principal
amount of Certificated Notes of authorized denominations.
(f) The Holder of any Global Note may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.1. Notices to Trustee.
-------------------
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.7 hereof, then it shall furnish to the
Trustee, at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the paragraph of the Notes and/or
Section of this Indenture pursuant to which the redemption shall occur, (ii) the
redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the
redemption price.
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Section 3.2. Selection of Notes to Be Redeemed.
----------------------------------
If less than all of the Notes are to be redeemed at any time,
selection of Notes for redemption shall be made by the Trustee in compliance
with the requirements of the principal national securities exchange, if any, on
which the Notes are listed, or, if the Notes are not so listed, on a pro rata
basis, by lot or by such method as the Trustee shall deem fair and appropriate;
provided that no Notes of $1,000 or less shall be redeemed in part. In the event
of partial redemption by lot, the particular Notes to be redeemed shall be
selected, unless otherwise provided herein, not less than 30 nor more than 60
days prior to the redemption date by the Trustee from the outstanding Notes not
previously called for redemption.
The Trustee 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 and
portions of Notes selected shall be in amounts of $1,000 or whole multiples of
$1,000; except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not a multiple
of $1,000, shall be redeemed. A new Note in principal amount equal to the
unredeemed portion thereof shall be issued in the name of the Holder thereof
upon cancellation of the original Note. On and after the redemption date, unless
the Company defaults in payment of the redemption price, interest ceases to
accrue on Notes or portions of them called for redemption. Except as provided in
this Section 3.2, provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption.
The provisions of the two preceding paragraphs of this Section
3.2 shall not apply with respect to any redemption affecting only a Global Note,
whether such Global Note is to be redeemed in whole or in part. In case of any
such redemption in part, the unredeemed portion of the principal amount of the
Global Note shall be in an authorized denomination.
Section 3.3. Notice of Redemption.
---------------------
Subject to the provisions of Section 3.9 hereof, at least 30
days but not more than 60 days before a redemption date, the Company shall mail
or cause to be mailed, by first class mail, a notice of redemption to each
Holder of Notes to be redeemed at such Holder's registered address.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
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(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption cease to accrue on
and after the redemption date;
(g) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are
being redeemed; and
(h) that no representation is made as to the
correctness or accuracy of the CUSIP number, if any, listed in
such notice or printed on the Notes.
If any of the Notes to be redeemed is in the form of a Global
Note, then such notice shall be modified in form but not substance to the extent
appropriate to accord with the procedures of the Depository applicable to
redemptions.
At the Company's request and expense, the Trustee shall give
the notice of redemption in the Company's name; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
Section 3.4. Effect of Notice of Redemption.
-------------------------------
Once notice of redemption is mailed in accordance with Section
3.3 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.
Section 3.5. Deposit of Redemption Price.
----------------------------
On or prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of and accrued interest on, all
Notes to be redeemed.
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If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the Person
in whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.1 hereof.
Section 3.6. Notes Redeemed in Part.
-----------------------
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon the receipt of a written authentication order of the
Company signed by two Officers of the Company, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
Section 3.7. Optional Redemption.
--------------------
(a) Except as set forth in clause (b) of this Section 3.7, the
Company shall not have the option to redeem the Notes pursuant to this Section
3.7 prior to ____________, 2002. From and after ____________, 2002, the Company
shall have the option to redeem the Notes, in whole or in part, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest thereon to the applicable redemption date, if
redeemed during the twelve-month period beginning on ____________ of each of the
years indicated below:
Percentage of
Year Principal Amount
---- ----------------
2002.................................... %
2003.................................... %
2004 ................................... %
2005 and thereafter..................... 100.000%
(b) Notwithstanding the provisions of clause (a) of this
Section 3.7, at any time prior to ___________, 2000, the Company may, at its
option, on any one or more occasions, redeem up to $33,333,000 in aggregate
principal amount of Notes at a redemption price of ___% of the principal amount
thereof, plus
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accrued and unpaid interest, if any, thereon to the redemption date with all or
a portion of the net proceeds of public sales of Equity Interests of the
Company; provided that at least $66,667,000 in aggregate principal amount of
Notes remains outstanding immediately after the occurrence of such redemption;
and provided, further, that such redemption shall occur within 60 days of the
date after the closing of the related sale of such Equity Interests.
(c) Any redemption pursuant to this Section 3.7 shall be made
pursuant to the provisions of Sections 3.1 through 3.6 hereof.
Section 3.8. Mandatory Redemption.
---------------------
Except as set forth under Sections 4.10 and 4.13 hereof, the
Company shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
Section 3.9. Offer to Purchase By Application of
Excess Proceeds. -----------------------------------
---------------
In the event that, pursuant to Section 4.10 hereof, the
Company shall be required to commence an offer to all Holders of Notes and, to
the extent required by the terms thereof, to all holders or lenders of other
Pari Passu Indebtedness, to purchase Notes and any such Pari Passu Indebtedness
(an "Asset Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "Offer Period"). No
later than five Business Days after the termination of the Offer Period (the
"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 hereof, giving effect to any
related offer for Pari Passu Indebtedness pursuant to Section 4.10, (the "Offer
Amount") or, if less than the Offer Amount has been tendered, all Notes tendered
in response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date
and on or before the related interest payment date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the
Company shall send, by first class mail, a notice to the Trustee
and each of the Holders. The notice shall contain all
instructions and materials necessary to enable such Holders to
tender Notes pursuant to the Asset Sale Offer. The Asset Sale
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Offer shall be made to all Holders. The notice, which shall govern the terms of
the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this
Section 3.9 and Section 4.10 hereof and the length of time the Asset
Sale Offer shall remain open;
(b) the Offer Amount, the purchase price and the
Purchase Date;
(c) that any Note not tendered or accepted for payment
shall continue to accrue interest;
(d) that, unless the Company defaults in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to
an Asset Sale Offer may only elect to have all of such Note purchased
and may not elect to have only a portion of such Note purchased;
(f) that Holders electing to have a Note purchased pursuant to
any Asset Sale Offer shall be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, or transfer by book-entry transfer, to the Company,
a Depository, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three Business Days before the
Purchase Date;
(g) that Holders shall be entitled to withdraw their election
if the Company, the Depository or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Note the Holder
delivered for purchase and a statement that such Holder is withdrawing
his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes
surrendered by Holders exceeds the Offer Amount, the Company shall
select the Notes to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only
Notes in denominations of $1,000, or integral multiples thereof, shall
be purchased) in the manner provided in Section 4.10; and
(i) that Holders whose Notes were purchased only in part shall
be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry
transfer).
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If any of the Notes subject to an Asset Sale Offer is in the
form of a Global Note, then such notice may be modified in form but not
substance to the extent appropriate to accord with the procedures of the
Depository applicable to repurchases.
On or before the Purchase Date, the Company shall, to the
extent lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Notes or portions thereof tendered pursuant to the Asset
Sale Offer, or if less than the Offer Amount has been tendered, all Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating that
such Notes or portions thereof were accepted for payment by the Company in
accordance with the terms of this Section 3.9. The Company, the Depository or
the Paying Agent, as the case may be, shall promptly (but in any case not later
than five days after the Purchase Date) mail or deliver to each tendering Holder
an amount equal to the purchase price of the Notes tendered by such Holder and
accepted by the Company for purchase, and the Company shall promptly issue a new
Note, and the Trustee, upon receipt of a written authentication order of the
Company signed by two Officers of the Company shall authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note 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 Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.9, any
purchase pursuant to this Section 3.9 shall be made pursuant to the provisions
of Sections 3.1 through 3.6 hereof.
ARTICLE 4
COVENANTS
Section 4.1. Payment of Notes.
-----------------
The Company shall pay or cause to be paid the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on the due date
money deposited by the Company in immediately available funds and designated for
and sufficient to pay all such amounts then due.
The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at the
rate equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the
extent lawful.
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Section 4.2. Maintenance of Office or Agency.
--------------------------------
The Company shall maintain in the Borough of Manhattan, the
City of New York, an office or agency (which may be an office of the Trustee or
an affiliate of the Trustee, Registrar or co-registrar) where principal,
premium, if any, and interest on the Notes will be paid and where Notes may be
surrendered for registration of transfer or for 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 prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
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, the City of New York for such purposes. The Company shall
give prompt 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 designates the following office of an
Affiliate of the Trustee as one such office or agency of the Company in
accordance with Section 2.3: _____________________.
Section 4.3. Reports.
--------
Notwithstanding that the Company may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, to the extent permitted by the Exchange Act, the Company shall file with
the Commission and provide, within 15 days after such filing, the Trustee and
Holders and prospective Holders (upon request) with the annual reports and the
information, documents and other reports that are specified in Sections 13 and
15(d) of the Exchange Act (but without exhibits in the case of the Holders and
prospective Holders). In the event that the Company is not permitted to file
such reports, documents and information with the Commission, the Company will
provide substantially similar information to the Trustees, the Holders and
prospective Holders (upon request) as if the Company were subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act. The Company
shall at all times comply with TIA Section 314(a).
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Section 4.4. Compliance Certificate.
-----------------------
(a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes to take with respect thereto) and
that to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of, premium,
if any, or interest on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto. As of the date hereof, the Company's fiscal year ends
on December 31 of each calendar year. In the event the Company changes its
fiscal year, it shall promptly notify the Trustee of such change.
(b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
fiscal year-end financial statements delivered pursuant to Section 4.3(a) above
shall be accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article 4 or Article 5 hereof or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, within five Business Days of any Officer
becoming aware of any Default or Event of Default, an Officers' Certificate
specifying such Default or Event of Default and what action the Company is
taking or proposes to take with respect thereto.
Section 4.5. Taxes.
------
The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency all material taxes,
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assessments, and governmental levies except such as are contested in good faith
and by appropriate proceedings or where the failure to effect such payment is
not adverse in any material respect to the Holders of the Notes.
Section 4.6. Stay, Extension and Usury Laws.
-------------------------------
Each of the Company and the Subsidiary Guarantors covenants
(to the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and each of the Company and the Subsidiary Guarantors (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not, by resort to any such law,
hinder, delay or impede the execution of any power herein granted to the
Trustee, but shall suffer and permit the execution of every such power as though
no such law has been enacted.
Section 4.7. Restricted Payments.
--------------------
The Company shall not and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any
dividend or make any other payment or distribution on account of the Company's
Equity Interests (including, without limitation, any payment to holders of the
Company's Equity Interests in connection with any merger or consolidation
involving the Company) or to the direct or indirect holders of the Company's
Equity Interests in their capacity as such (other than dividends or
distributions payable in Equity Interests (other than Disqualified Stock) of the
Company); (ii) purchase, redeem or otherwise acquire or retire for value any
Equity Interests of the Company or any direct or indirect parent or other
Affiliate of the Company that is not a Wholly Owned Restricted Subsidiary of the
Company; (iii) make any principal payment on, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness that is subordinated to
the Notes, except at final maturity; or (iv) make any Restricted Investment (all
such payments and other actions set forth in clauses (i) through (iv) above
being collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof;
and
(b) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period,
have been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the
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Fixed Charge Coverage Ratio test set forth in the first
paragraph of Section 4.9 hereof; and
(c) such Restricted Payment, together with the aggregate of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date of this Indenture (excluding Restricted
Payments permitted by clauses (2), (3), (5), (6) and (7) of the next
succeeding paragraph), is less than the sum of (i) 50% of the
Consolidated Net Income of the Company for the period (taken as one
accounting period) from the beginning of the first fiscal quarter
commencing after the date of this Indenture to the end of the Company's
most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if
such Consolidated Net Income for such period is a deficit, less 100% of
such deficit), plus (ii) 100% of the aggregate net cash proceeds
received by the Company from the issue and sale since the date of this
Indenture of Equity Interests in the Company or of debt securities of
the Company that have been converted into or exchanged for such Equity
Interests (other than Equity Interests (or convertible debt securities)
sold to a Subsidiary of the Company and other than Disqualified Stock
or debt securities that have been converted into Disqualified Stock),
plus (iii) to the extent that any Restricted Investment that was made
after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the net proceeds of
such sale, liquidation or repayment and (B) the initial amount of such
Restricted Investment; provided, however, that the foregoing provisions
of this paragraph (c) will not prohibit Restricted Payments in an
aggregate amount not to exceed $20 million.
The foregoing provisions shall not prohibit (1) the payment of
any dividend within 60 days after the date of declaration thereof, if at said
date of declaration such payment would have complied with the provisions of this
Indenture; (2) the redemption, repurchase, retirement or other acquisition of
any Equity Interests of the Company in exchange for, or out of the proceeds of,
the substantially concurrent sale (other than to a Subsidiary of the Company) of
other Equity Interests of the Company (other than any Disqualified Stock);
provided that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement or other acquisition shall be excluded
from clause (c)(ii) of the preceding paragraph; (3) the defeasance, redemption
or repurchase of Subordinated Indebtedness with the net cash proceeds from an
incurrence of subordinated Permitted Refinancing Debt or the substantially
concurrent sale (other than to a Subsidiary of the Company) of Equity Interests
of the Company (other than Disqualified Stock); provided that the amount of any
such net cash proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (c)(ii) of the
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preceding paragraph; (4) the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of the Company or any Subsidiary of
the Company held by any of the Company's (or any of its Subsidiaries') employees
pursuant to any management equity subscription agreement or stock option
agreement in effect as of the date of this Indenture; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests shall not exceed $2.0 million in any twelve-month period; and
provided further that no Default or Event of Default shall have occurred and be
continuing immediately after such transaction; (5) repurchases of Equity
Interests deemed to occur upon exercise of stock options if such Equity
Interests represent a portion of the exercise price of such options; (6) the
redemption of the Company's 6% Convertible Subordinated Debentures due February
1, 2007; provided that the average closing price of the Company's common stock
for the 30 trading days prior to the date of such redemption is greater than
120% of the conversion price and (7) conversion or exchange of the Company's
$2.03 Convertible Preferred Stock into Common Stock in accordance with its
terms.
The amount of all Restricted Payments (other than cash) shall
be the fair market value (as determined in good faith by a resolution of the
Board of Directors of the Company set forth in an Officers' Certificate
delivered to the Trustee, which determination shall be conclusive evidence of
compliance with this provision) on the date of the Restricted Payment of the
asset(s) proposed to be transferred by the Company or the applicable Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. Not later
than five days after the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.7 were computed.
In computing Consolidated Net Income for purposes of this
Section 4.7, (i) the Company shall use audited financial statements for the
portion of the relevant period for which audited financial statements are
available on the date of determination and unaudited financial statements and
other current financial data based on the books and records of the Company for
the remaining portion of such period and (ii) the Company shall be permitted to
rely in good faith on the financial statements and other financial data derived
from the books and records of the Company that are available on the date of
determination. If the Company makes a Restricted Payment which, at the time of
the making of such Restricted Payment, would on the good faith determination of
the Company be permitted under the requirements of this Indenture, such
Restricted Payment shall be deemed to have been made in compliance with this
Indenture notwithstanding any subsequent adjustments made in good faith to the
Company's financial statements affecting Consolidated Net Income of the Company
for any period.
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The Board of Directors may designate any Restricted Subsidiary
to be an Unrestricted Subsidiary if such designation would not cause a Default.
For purposes of making such determination, all outstanding Investments by the
Company and its Restricted Subsidiaries (except to the extent repaid in cash) in
the Subsidiary so designated shall be deemed to be Restricted Payments at the
time of such designation and shall reduce the amount available for Restricted
Payments under clause (c) of the first paragraph of this covenant. All such
outstanding Investments shall be deemed to constitute Investments in an amount
equal to the greater of the fair market value or the book value of such
Investments at the time of such designation. Such designation shall only be
permitted if such Restricted Payment would be permitted at such time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
Section 4.8. Dividend and Other Payment Restrictions
Affecting Subsidiaries. ---------------------------------------
-----------------------
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary to (i)(x) pay dividends or make any other
distributions to the Company or any of its Restricted Subsidiaries (1) on its
Capital Stock or (2) with respect to any other interest or participation in, or
measured by, its profits, or (y) pay any indebtedness owed by it to the Company
or any of its Restricted Subsidiaries, (ii) make loans or advances to the
Company or any of its Restricted Subsidiaries or (iii) transfer any of its
properties or assets to the Company or any of its Restricted Subsidiaries,
except for such encumbrances or restrictions existing under or by reason of (a)
the Credit Agreement as in effect as of the date of this Indenture, and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings thereof or any other Credit Facility,
provided that such amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements, refinancings or any other Credit
Facilities are no more restrictive taken as a whole with respect to such
dividend and other payment restrictions than those contained in the Credit
Agreement as in effect on the date of this Indenture, (b) this Indenture and the
Notes, (c) applicable law, (d) any instrument governing Indebtedness or Capital
Stock of a Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such acquisition (except, in the case of
Indebtedness, to the extent such Indebtedness was incurred in connection with or
in contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person and its Subsidiaries, or the property or assets of the Person and its
Subsidiaries, so acquired, provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be
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incurred, (e) by reason of customary non-assignment provisions in leases and
customary provisions in other agreements that restrict assignment of such
agreements or rights thereunder, entered into in the ordinary course of business
and consistent with past practices, (f) purchase money obligations for property
acquired in the ordinary course of business that impose restrictions of the
nature described in clause (iii) above on the property so acquired or (g)
Permitted Refinancing Debt, provided that the restrictions contained in the
agreements governing such Permitted Refinancing Debt are no more restrictive
than those contained in the agreements governing the Indebtedness being
refinanced.
Section 4.9. Incurrence of Indebtedness and Issuance
of Disqualified Stock. ---------------------------------------
----------------------
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create incur, issue, assume,
guarantee or otherwise become directly or indirectly liable, contingently or
otherwise, with respect to (collectively, "incur") any Indebtedness (including
Acquired Debt) and the Company shall not issue any Disqualified Stock and shall
not permit any of its Restricted Subsidiaries to issue any shares of preferred
stock; provided, however, that the Company may incur Indebtedness (including
Acquired Debt) or issue shares of Disqualified Stock if:
(i) the Fixed Charge Coverage Ratio for the Company's
most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on
which such additional Indebtedness is incurred or such Disqualified
Stock is issued would have been at least 2.5 to 1, determined on a pro
forma basis as set forth in the definition of Fixed Charge Coverage
Ratio; and
(ii) no Default or Event of Default shall have occurred
and be continuing at the time such additional Indebtedness is incurred
or such Disqualified Stock is issued or would occur as a consequence of
the incurrence of the additional Indebtedness or the issuance of the
Disqualified Stock.
Notwithstanding the foregoing, this Indenture shall not
prohibit any of the following (collectively, "Permitted Indebtedness"): (a) the
Indebtedness evidenced by the Notes; (b) the incurrence by the Company or any of
its Restricted Subsidiaries of Indebtedness pursuant to Credit Facilities, so
long as the aggregate principal amount of all Indebtedness outstanding under all
Credit Facilities does not, at any one time, exceed the greater of (1) $400.0
million (or, if there is any permanent reduction in the aggregate principal
amount permitted to be borrowed under the Credit Agreement, such lesser
aggregate principal amount) and (2) an amount equal to the sum of [(x) $25
million plus (y) 30% of Adjusted Consolidated Net
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Tangible Assets] determined after the incurrance of such Indebtedness (including
the application of the proceeds therefrom; (c) the guarantee by any Subsidiary
Guarantor of any Indebtedness that is permitted by this Indenture to be incurred
by the Company; (d) all Indebtedness of the Company and its Restricted
Subsidiaries in existence as of the date of the Indenture after giving effect to
the Cometra Acquisition, the related financing transactions and the application
of the proceeds thereof; (e) intercompany Indebtedness between or among the
Company and any of its Wholly Owned Restricted Subsidiaries; PROVIDED, HOWEVER,
that (i) if the Company is the obligor on such Indebtedness, such Indebtedness
is expressly subordinate to the payment in full of all Obligations with respect
to the Notes and (ii)(A) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other than the
Company or a Wholly Owned Restricted Subsidiary and (B) any sale or other
transfer of any such Indebtedness to a Person that is not either the Company or
a Wholly Owned Restricted Subsidiary shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be; (f) Indebtedness in connection with one or more
standby letters of credit, guarantees, performance bonds or other reimbursement
obligations, in each case, issued in the ordinary course of business and not in
connection with the borrowing of money or the obtaining of advances or credit
(other than advances or credit on open account, includible in current
liabilities, for goods and services in the ordinary course of business and on
terms and conditions which are customary in the Oil and Gas Business, and other
than the extension of credit represented by such letter of credit guarantee or
performance bond itself), not to exceed in the aggregate at any given time 5.0%
of Total Assets; (g) Indebtedness under Interest Rate Hedging Agreements entered
into for the purpose of limiting interest rate risks, provided that the
obligations under such agreements are related to payment obligations on
Indebtedness otherwise permitted by the terms of this covenant and that the
aggregate notional principal amount of such agreements does not exceed 105% of
the principal amount of the Indebtedness to which such agreements relate; (h)
Indebtedness under Oil and Gas Hedging Contracts, provided that such contracts
were entered into in the ordinary course of business for the purpose of limiting
risks that arise in the ordinary course of business of the Company and its
Restricted Subsidiaries; (i) the incurrence by the Company of Indebtedness not
otherwise permitted to be incurred pursuant to this paragraph, provided that the
aggregate principal amount (or accreted value, as applicable) of all
Indebtedness incurred pursuant to this clause (i), together with all Permitted
Refinancing Debt incurred pursuant to clause (j) of this paragraph in respect of
Indebtedness previously incurred pursuant to this clause (i), does not exceed
$10.0 million at any one time outstanding; (j) Permitted Refinancing Debt
incurred in exchange for, or the net proceeds of which are used to refinance,
extend, renew, replace, defease or refund, Indebtedness that was
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permitted by this Indenture to be incurred (including Indebtedness previously
incurred pursuant to this clause (j)); (k) accounts payable or other obligations
of the Company or any Restricted Subsidiary to trade creditors created or
assumed by the Company or such Restricted Subsidiary in the ordinary course of
business in connection with the obtaining of goods or services; (l) Indebtedness
consisting of obligations in respect of purchase price adjustments, guarantees
or indemnities in connection with the acquisition or disposition of assets; and
(m) production imbalances that do not, at any one time outstanding, exceed 2% of
the Total Assets of the Company.
The Company shall not permit any of its Unrestricted
Subsidiary to incur any Indebtedness other than Non-Recourse Debt; provided,
however, if any such Indebtedness ceases to be Non-Recourse Debt, such event
shall be deemed to constitute an incurrence of Indebtedness by the Company.
Section 4.10. Asset Sales.
------------
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, engage in an Asset Sale unless (i) the Company (or
the Restricted Subsidiary, as the case may be) receives consideration at the
time of such Asset Sale at least equal to the fair market value (as determined
in good faith by a resolution of the Board of Directors of the Company set forth
in an Officers' Certificate delivered to the Trustee, which determination shall
be conclusive evidence of compliance with this provision) of the assets or
Equity Interests issued or sold or otherwise disposed of and (ii) at least 85%
of the consideration therefor received by the Company or such Restricted
Subsidiary in such Asset Sale, plus all other Asset Sales since the date of this
Indenture, on a cumulative basis, is in the form of cash or Cash Equivalents;
provided that the amount of any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet), of the Company or any
Restricted Subsidiary (other than contingent liabilities and liabilities that
are by their terms subordinated to the Notes or any guarantee thereof) that are
assumed by the transferee of any such assets pursuant to a customary novation
agreement that releases the Company or such Restricted Subsidiary from further
liability.
Within 360 days after the receipt of any Net Proceeds from an
Asset Sale, the Company may apply such Net Proceeds, at its option: (a) to
reduce Senior Debt, (b) to acquire controlling interests in another Oil and Gas
Business, (c) to make capital expenditures in respect of the Company's or its
Restricted Subsidiaries' Oil and Gas Business, (d) to purchase long-term assets
that are used or useful in such Oil and Gas Business or (e) to repurchase any
Notes. Pending the final application of any such Net Proceeds, the Company may
temporarily reduce Senior Debt that is revolving debt or otherwise invest such
Net Proceeds in any manner that is not prohibited by this
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Indenture. Any Net Proceeds from Asset Sales that are not
applied as provided in the first sentence of this paragraph shall
(after the expiration of the periods specified in this paragraph)
be deemed to constitute "Excess Proceeds."
When the aggregate amount of Excess Proceeds exceeds $10.0
million, the Company shall make an Asset Sale Offer to purchase the maximum
principal amount of Notes and any other Pari Passu Indebtedness to which the
Asset Sale Offer applies that may be purchased out of the Excess Proceeds, at an
offer price in cash in an amount equal to, in the case of the Notes, 100% of the
principal amount thereof plus accrued and unpaid interest thereon to the date of
purchase or, in the case of any other Pari Passu Indebtedness, 100% of the
principal amount thereof (or with respect to discount Pari Passu Indebtedness,
the accreted value thereof) on the date of purchase, in each case, in accordance
with the procedures set forth in Section 3.9 hereof or the agreements governing
Pari Passu Indebtedness, as applicable. To the extent that the aggregate
principal amount (or accreted value, as the case may be) of the Notes and Pari
Passu Indebtedness tendered pursuant to an Asset Sale Offer is less than the
Excess Proceeds, the Company may use any remaining Excess Proceeds for general
corporate purposes. If the sum of (i) the aggregate principal amount of Notes
surrendered by Holders thereof, and (ii) the aggregate principal amount or
accreted value, as the case may be, of other Pari Passu Indebtedness surrendered
by holders or lenders thereof, exceeds the amount of Excess Proceeds, the
Trustee and the trustee or other lender representatives for the Pari Passu
Indebtedness shall select the Notes and other Pari Passu Indebtedness to be
purchased on a pro rata basis, based on the aggregate principal amount (or
accreted value, as applicable) thereof surrendered in such Asset Sale Offer.
Upon completion of such Asset Sale Offer, the Excess Proceeds shall be reset at
zero.
Section 4.11. Transactions with Affiliates.
-----------------------------
The Company shall not, and shall not permit any of its
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any contract, agreement,
understanding, loan, advance or guarantee with, or for the benefit of, any of
its Affiliates (each of the foregoing, an "Affiliate Transaction"), unless (i)
such Affiliate Transaction is on terms that are no less favorable to the Company
or the relevant Subsidiary than those that would have been obtained in a
comparable transaction by the Company or such Subsidiary with an unrelated
Person and (ii) the Company delivers to the Trustee (a) with respect to an
Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $1,000,000 but less than or equal to
$5,000,000, an Officers' Certificate to the Trustee certifying that such
Affiliate Transaction complies with clause (i) above, (b) with respect to any
Affiliate Transaction or
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series of related Affiliate Transactions involving aggregate consideration in
excess of $5,000,000 but less than or equal to $10,000,000, a resolution of the
Board of Directors set forth in an Officer's Certificate certifying that such
Affiliate Transaction or series of related Affiliate Transactions complies with
clause (i) above and that such Affiliate Transaction or series of related
Affiliate Transactions has been approved in good faith by a majority of the
members of the Board of Directors of the Company who are disinterested with
respect to such Affiliate Transaction or series of related Affiliate
Transactions (which resolution shall be conclusive evidence of compliance with
this provision) and (c) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration of $10,000,000
or more, a resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction or series of related
Affiliate Transactions complies with clause (i) above and that such Affiliate
Transaction or series of related Affiliate Transactions has been approved in
good faith by a resolution adopted by a majority of the members of the Board of
Directors of the Company who are disinterested with respect to such Affiliate
Transaction or series of related Affiliate Transactions and an opinion as to the
fairness to the Company or such Subsidiary of such Affiliate Transaction or
series of related Affiliate Transactions from a financial point of view issued
by an accounting, appraisal, engineering or investment banking firm of national
standing (which resolution and fairness opinion shall be conclusive evidence of
compliance with this provision), provided, however, that the foregoing shall not
apply to (1) transactions contemplated by any employment agreement or other
compensation plan or arrangement entered into by the Company or any of its
Subsidiaries in the ordinary course of business and consistent with the past
practice of the Company or such Subsidiary, (2) transactions between or among
the Company and/or its Restricted Subsidiary, (3) Permitted Investments and
Restricted Payments that are permitted by Section 4.7 hereof, and (4) any
indemnification payment made to any director, officer or employee of the Company
or any Subsidiary pursuant to charter, bylaw, statutory or contractual
provisions.
Section 4.12. Liens.
------
The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, create, incur, assume or otherwise cause or suffer
to exist or become effective any Lien securing Indebtedness of any kind (other
than Permitted Liens) upon any of its property or assets, now owned or hereafter
acquired, unless all payments under the Notes are secured by such Lien prior to,
or on an equal and ratable basis with, the Indebtedness so secured for so long
as such Indebtedness is secured by such Lien.
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Section 4.13. Offer to Repurchase Upon Change of Control.
-------------------------------------------
(a) Upon the occurrence of a Change of Control, each Holder of
the Notes shall have the right to require the Company to repurchase all or any
part (equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described below (the "Change of Control Offer") at an
offer price in cash equal to 101% of the aggregate principal amount of the Notes
plus accrued and unpaid interest if any, thereon to the date of purchase (the
"Change of Control Payment"). Within 30 days following any Change of Control,
the Company shall mail a notice to each Holder stating: (1) a description of the
transaction or transactions that constitute the Change of Control; (2) that the
Change of Control Offer is being made pursuant to this Section 4.13 and that all
Notes tendered shall be accepted for payment; (3) the purchase price and the
purchase date described below (the "Change of Control Payment Date"); (4) that
any Note not tendered shall continue to accrue interest, if any; (5) that,
unless the Company defaults in the payment of the Change of Control Payment, all
Notes accepted for payment pursuant to the Change of Control Offer shall cease
to accrue interest, if any, after the Change of Control Payment Date; (6) that
Holders electing to have any Notes purchased pursuant to a Change of Control
Offer shall be required to surrender the Notes, with the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Notes completed, to the
Paying Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Change of Control Payment Date;
(7) that Holders shall be entitled to withdraw their election if the Paying
Agent receives, not later than the close of business on the second Business Day
preceding the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Holder is
withdrawing his election to have the Notes purchased; and (8) that Holders whose
Notes are being purchased only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered, which
unpurchased portion must be equal to $1,000 in principal amount or an integral
multiple thereof. The Company and each Subsidiary Guarantor shall comply with
the requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable to such party in connection with the repurchase of the Notes as a
result of a Change of Control.
(b) On a Business Day that is no earlier than 30 days nor
later than 60 days from the date that the Company mails or causes to be mailed
notice of the Change of Control to the Holders (the "Change of Control Payment
Date"), the Company shall, to the extent lawful, (i) accept for payment all
Notes or portions thereof properly tendered pursuant to the Change of Control
Offer, (ii) deposit with the Paying Agent an amount equal
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to the Change of Control Payment in respect of all the Notes or portions thereof
so tendered and (iii) deliver or cause to be delivered to the Trustee the Notes
so accepted together with an Officers' Certificate stating the aggregate
principal amount of such Notes or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to each Holder of the Notes so
tendered the Change of Control Payment for such Notes, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each such new Note shall be in a
principal amount of $1,000 or an integral multiple 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.
The Change of Control provisions described above shall be
applicable whether or not any other provisions of this Indenture are applicable.
The Company shall not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.13 and purchases all Notes (or portions
thereof) validly tendered and not withdrawn under such Change of Control Offer.
Section 14.4. Additional Subsidiary Guarantees.
---------------------------------
In the event that the Company or any of its Subsidiaries shall
acquire or create a Subsidiary after the date of this Indenture, such newly
acquired or created Subsidiary shall be deemed to make the guarantee set forth
in Section 11.1 and the Company shall cause such Subsidiary to evidence such
guarantee in the manner set forth in Section 11.2.
Section 14.5. Corporate Existence.
--------------------
Subject to Article 5 hereof, the Company and the Subsidiaries
shall do or cause to be done all things necessary to preserve and keep in full
force and effect (i) its corporate existence, and the corporate, partnership or
other existence of each of the Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of the
Company or any such Subsidiary and (ii) the rights (charter, partnership
agreement and statutory), licenses and franchises of the Company and the
Subsidiaries; provided, however, that the Company and the Subsidiaries shall not
be required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of the Subsidiaries, if the Board of
Directors of the relevant Person shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company and the
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Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any
material respect to the Holders of the Notes.
Section 4.16. No Senior Subordinated Debt.
----------------------------
Notwithstanding the provisions of Section 4.9 hereof, (i) the
Company shall not incur, create, issue, assume, guarantee or otherwise become
liable for any Indebtedness that is subordinate or junior in right of payment to
any Senior Debt of the Company and senior in any respect in right of payment to
the Notes and (ii) the Subsidiary Guarantors shall not directly or indirectly
incur, create, issue, assume, guarantee or otherwise become liable for any
Indebtedness that is subordinate or junior in right of payment to any guarantees
issued in respect of Senior Debt of the Company and senior in any respect in
right of payment to the Guarantees; provided, however, that the foregoing
limitations shall not apply to distinctions between categories of Indebtedness
that exist by reason of any Liens arising or created in respect of some but not
all such Indebtedness.
Section 4.17. Business Activities.
--------------------
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any material respect in any business other than the Oil
and Gas Business.
ARTICLE 5
SUCCESSORS
Section 5.1. Merger, Consolidation, or Sale of Substantially
All Assets. -----------------------------------------------
-----------
The Company shall not consolidate or merge with or into
(whether or not the Company is the surviving corporation), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets, in one or more related transactions, to another Person,
and the Company may not permit any of its Restricted Subsidiaries to enter into
any such transaction or series of transactions if such transaction or series of
transactions would, in the aggregate, result in a sale, assignment, transfer,
lease, conveyance, or other disposition of all or substantially all of the
properties or assets of the Company to another Person, in either case unless (i)
the Company is the surviving corporation or the Person formed by or surviving
any such consolidation or merger (if other than the Company) or to which such
sale, assignment, transfer, lease, conveyance or other disposition shall have
been made (the "Surviving Entity") is a corporation organized or existing under
the laws of the United States, any state thereof or the District of Columbia;
(ii) the Surviving Entity (if the Company is not the continuing obligor under
the Indenture) assumes all the obligations of the Company under the Notes and
the Indenture pursuant to a supplemented indenture in a form reasonably
satisfactory to the
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Trustee; (iii) immediately before and after giving effect to such transaction or
series of transactions no Default or Event of Default exists; (iv) immediately
after giving effect to such transaction or series of transactions on a pro forma
basis (and treating any Indebtedness not previously an obligation of the Company
or any of its Subsidiary which becomes the obligation of the Company or any of
its Subsidiary as a result of such transaction or series of transactions as
having been incurred at the time of such transaction or series of transactions),
the Consolidated Net Worth of the Company and its Subsidiaries or the Surviving
Entity (if the Company is not the continuing obligor under this Indenture) is
equal to or greater than the Consolidated Net Worth of the Company and its
Subsidiaries immediately prior to such transaction or series of transactions and
(v) the Company or Surviving Entity (if the Company is not the continuing
obligor under the Indenture) will, at the time of such transaction or series of
transactions and after giving pro forma effect thereto as if such transaction or
series of transactions had occurred at the beginning of the applicable
four-quarter period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the test set forth in the first paragraph of Section
4.9 hereof. Notwithstanding the foregoing clauses (iv) and (v), any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Company, and any Wholly Owned Restricted Subsidiary
may consolidate with, merge into or transfer all or part of its properties and
assets to another Wholly Owned Restricted Subsidiary.
Section 5.2. Successor Corporation Substituted.
----------------------------------
Upon any consolidation or merger, or any sale, assignment,
transfer, lease, conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.1 hereof, the Surviving
Entity shall succeed to, and be substituted for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the Surviving Entity and not to the Company), and may exercise every right and
power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.1 hereof.
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ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.1. Events of Default.
------------------
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest, if any, on
the Notes when the same becomes due and payable and the Default
continues for a period of 30 days, whether or not such payment is
prohibited by the provisions of Article 10 hereof;
(2) the Company defaults in the payment of the principal of or
premium, if any, on the Notes, whether or not such payment is
prohibited by the provisions of Article 10 hereof;
(3) the Company fails to observe or perform any covenant,
condition or agreement on the part of the Company to be observed or
performed pursuant to Article 5 hereof;
(4) the Company fails to observe or perform any covenant,
condition or agreement on the part of the Company to be observed or
performed pursuant to Sections 4.3, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12,
4.13, 4.14, 4.16 and 4.17 hereof and the Default continues for the
period and after the notice specified below;
(5) the Company fails to comply with any of its other agreements
or covenants in, or provisions of, the Notes or this Indenture and the
Default continues for consecutive days after the notice specified
below;
(6) except as permitted herein, any Guarantee shall be held in
any judicial proceeding to be unenforceable or invalid or shall cease
for any reason to be in full force and effect or a Subsidiary
Guarantor, or any Person acting on behalf of a Subsidiary Guarantor,
shall deny or disaffirm such Subsidiary Guarantor's obligation under
its Guarantee;
(7) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of
its Restricted Subsidiaries (or the payment of which is guaranteed by
the Company or any of its Restricted Subsidiaries), whether such
Indebtedness or guarantee now exists or shall be created hereafter,
which default (a) is caused by a failure to pay principal of or
premium, if any, or interest on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the
date of such default (a "Payment Default") or (b) results in the
acceleration of such Indebtedness prior to its express maturity and,
in each
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case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there is
then existing a Payment Default or the maturity of which has been so
accelerated, aggregates $10 million or more; provided, that if any
such default is cured or waived or any such acceleration rescinded, or
such Indebtedness is repaid, within a period of 10 days from the
continuation of such default beyond the applicable grace period or the
occurrence of such acceleration, as the case may be, such Event of
Default under this Indenture and any consequential acceleration of the
Notes shall be automatically rescinded;
(8) a final non-appealable judgment or order or final
non-appealable judgments or orders are rendered against the Company or
any Restricted Subsidiary that remain unpaid or discharged for a
period of 60 days and that require the payment of money, either
individually or in an aggregate amount, in excess of $5 million;
(9) the Company or any Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case or proceeding,
(b) consents to the entry of an order for relief against it
in an involuntary case or proceeding,
(c) consents to the appointment of a Custodian of it or for
all or substantially all of its property or
(d) makes a general assignment for the benefit of its
creditors;
(10) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(a) is for relief against the Company or any Significant
Subsidiary or any group of Subsidiaries that, taken together,
would constitute a Significant Subsidiary, in an involuntary case
or proceeding,
(b) appoints a Custodian of the Company, any Significant
Subsidiary or any group of Subsidiaries that, taken together,
would constitute a Significant Subsidiary, or for all or
substantially all of the property of the Company, any Significant
Subsidiary or any group of Subsidiaries that, taken together,
would constitute a Significant Subsidiary, or
(c) orders the liquidation of the Company, any Significant
Subsidiary or any group of Subsidiaries
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that, taken together, would constitute a Significant Subsidiary,
and in each case the order or decree remains unstayed and in effect for
60 consecutive days.
The term "Custodian" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
A Default under clause (4) is not an Event of Default until
the Trustee notifies the Company, or the Holders of at least 25% in principal
amount of the then outstanding Notes notify the Company and the Trustee, of the
Default and the Company does not cure the Default within 30 consecutive days
after receipt of the notice. A Default under clause (5) is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in principal amount of the then outstanding Notes notify the Company and the
Trustee, of the Default and the Company does not cure the Default within 60 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."
Section 6.2. Acceleration.
-------------
If an Event of Default (other than an Event of Default
specified in clauses (9) and (10) of Section 6.1 hereof) relating to the Company
or any Subsidiary Guarantor occurs and is continuing, the Trustee by notice to
the Company, or the Holders of at least 25% in principal amount of the then
outstanding Notes by written notice to the Company and the Trustee, may declare
the unpaid principal amount of and any accrued and unpaid interest on all the
Notes to be due and payable immediately. If payment of the Notes is accelerated
because of an Event of Default, the Company or the Trustee shall notify the
holders of Designated Senior Debt of such acceleration. Upon such declaration
the principal and interest shall be due and payable immediately; provided,
however, that so long as any Designated Senior Debt or any commitment therefor
is outstanding, any such notice or declaration shall not become effective until
the earlier of (a) five Business Days after such notice is delivered to the
representative for the Designated Senior Debt or (b) the acceleration of any
Designated Senior Debt and thereafter, payments on the Notes pursuant to this
Article 6 shall be made only to the extent permitted pursuant to Article 10
herein. Notwithstanding the foregoing, if any Event of Default specified in
clause (9) or (10) of Section 6.1 hereof relating to the Company, any
Significant Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary occurs, such an amount shall ipso facto
become and be immediately due and payable without any declaration or other act
or notice on the part of the Trustee or any Holder.
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After a declaration of acceleration under this Indenture, but
before a judgment or decree for payment of principal, premium, if any, and
interest on the Notes due under this Article 6 has been obtained by the Trustee,
Holders of a majority in principal amount of the then outstanding Notes by
written notice to the Company and the Trustee may rescind an acceleration and
its consequences if (i) the Company or any Subsidiary Guarantor has paid or
deposited with the Trustee a sum sufficient to pay (a) all sums paid or advanced
by the Trustee under this Indenture and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel and (b) all
overdue interest on the Notes, if any, (ii) the rescission would not conflict
with any judgment or decree of a court of competent jurisdiction and (iii) all
existing Events of Default (except nonpayment of principal, premium, if any, or
interest that has become due solely because of the acceleration) have been cured
or waived.
Section 6.3. Other Remedies.
---------------
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest on the Notes or to enforce the performance of any provision of
the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of a Note in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Section 6.4. Waiver of Past Defaults.
------------------------
Holders of not less than a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of principal of, premium and liquidated damages, if any, or
interest on, the Notes (including in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
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 any right consequent thereon.
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Section 6.5. Control by Majority.
--------------------
Holders of a majority in principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Notes or that may
involve the Trustee in personal liability it being understood that (subject to
Section 7.1) the Trustee shall have no duty to ascertain whether or not such
actions or forebearances are unduly prejudicial to such holders.
Section 6.6. Limitation on Suits.
--------------------
A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice
of a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the
then outstanding Notes make a written request to the Trustee to
pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if
requested, the provision of indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the
Trustee a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.
Section 6.7. Rights of Holders of Notes to Receive Payment.
----------------------------------------------
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Note to receive payment of principal, premium, if any,
and interest on the Note, on or after the respective due dates expressed in the
Note (including in connection with an offer to purchase), or to bring suit for
the enforcement of any such payment on or after such respective
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dates, shall not be impaired or affected without the consent of
such Holder.
Section 6.8. Collection Suit by Trustee.
---------------------------
If an Event of Default specified in Section 6.1(1) or (2)
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company or any
Subsidiary Guarantor for the whole amount of principal of, premium, if any, and
interest remaining unpaid on the Notes and interest on overdue principal and, to
the extent lawful, interest and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
Section 6.9. Trustee May File Proofs of Claim.
---------------------------------
The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial proceedings relative to the
Company or any of the Subsidiary Guarantors (or any other obligor upon the
Notes), its creditors or its property and shall be entitled and empowered to
collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian 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 to 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 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.7 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. 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, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and may be a member of the
creditors' committee.
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Section 6.10. Priorities.
-----------
If the Trustee collects any money pursuant to this Article, it
shall, subject to the provisions of Article 10, pay out the money in the
following order:
First: to the Trustee, its agents and attorneys for amounts
due under Sections 6.8 and 7.7 hereof, including payment of all compensation,
expense and liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium, if any, and accrued interest, ratably, without
preference or priority of any kind, according to the amounts due and payable on
the Notes for principal, premium, if any, and accrued interest, as the case may
be, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
----------------------
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.7 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.1. Duties of Trustee.
------------------
(a) If 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 its exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
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(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely
by the express provisions of this Indenture and the Trustee need
perform only those duties that are specifically set forth in this
Indenture and no others, and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(ii) 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 any notices,
requests, statements, 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 liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(iii) 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 6.5 hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have furnished
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee
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need not be segregated from other funds except to the extent required by law.
Section 7.2. Rights of Trustee.
------------------
(a) The Trustee may conclusively rely upon 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
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the written advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(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 that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company or any Subsidiary
Guarantor shall be sufficient if signed by an Officer of the Company or such
Subsidiary Guarantor.
(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 or
direction of any of the Holders unless such Holders shall have furnished to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.
(g) Except with respect to Sections 4.1 and 4.4 hereof, the
Trustee shall have no duty to inquire as to the performance of the Company's
covenants in Article 4 hereof. In addition, the Trustee shall not be deemed to
have knowledge of any Default or Event of Default except (i) any Event of
Default occurring pursuant to Sections 4.1, 4.4 and 6.1(1) or (2) hereof or (ii)
any Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge. For the purposes of this clause (g)
only, "actual knowledge" shall mean the actual fact or statement of knowing,
without any duty to make investigation with regard thereto.
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(h) The Trustee shall not be required to give any bond or
surety in respect of the performance of its powers and duties hereunder.
(i) 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, except as otherwise set forth herein, but the Trustee
may require of the Company full information and advice as to the performance of
the covenants, conditions and agreements contained herein and shall be entitled
in connection herewith to examine the books, records and premises of the
Company.
(j) The permissive rights of the Trustee to perform the acts
enumerated in this Indenture shall not be construed as a duty and the Trustee
shall not be answerable for other than its negligence or willful misconduct.
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, the
Subsidiary Guarantors or any Affiliate of the Company with the same rights it
would have if it were not Trustee. However, in the event that the Trustee
acquires any conflicting interest it must eliminate such conflict within 90
days, apply to the Commission for permission to continue as trustee or resign.
Any Agent may do the same with like rights and duties. The Trustee is also
subject to Sections 7.10 and 7.11 hereof.
Section 7.4. Trustee's Disclaimer.
---------------------
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Notes, or
the Guarantees, it shall not be accountable for the Company's use of the
proceeds from the Notes or any money paid to the Company or upon the Company's
direction under any provision of this Indenture, it shall not be responsible for
the use or application of any money received by any Paying Agent other than the
Trustee, and it shall not be responsible for any statement or recital herein or
in any certificate delivered pursuant hereto or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.5. Notice of Defaults.
-------------------
If a Default or Event of Default occurs and is continuing and
if it is actually known to the Trustee, the Trustee shall mail to Holders of
Notes a notice of the Default or Event of Default within 90 days after it
occurs. Except in the case of a Default or Event of Default in payment of
principal of, premium, if any, or interest on, any Note, the Trustee may
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withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests of the
Holders of the Notes.
Section 7.6. Reports by Trustee to Holders of the Notes.
-------------------------------------------
Within 60 days after each _____________ beginning with the
________________ following the date of this Indenture, and for so long as Notes
remain outstanding, the Trustee shall mail to the Holders of the Notes a brief
report dated as of such reporting date that complies with TIA ss. 313(a) (but if
no event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA ss. 313(b)(2) and transmit by mail all reports as required
by TIA ss. 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the Commission
and each stock exchange on which the Notes are listed in accordance with TIA ss.
313(d). The Company shall promptly notify the Trustee when the Notes are listed
on any stock exchange.
Section 7.7. Compensation and Indemnity.
---------------------------
The Company and the Subsidiary Guarantors shall pay to the
Trustee from time to time reasonable compensation for its acceptance of this
Indenture and services hereunder, including, without limitation, extraordinary
services such as default administration. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company
and the Subsidiary Guarantors shall reimburse the Trustee promptly upon request
for all reasonable disbursements, advances and expenses incurred or made by it
in addition to the compensation for its services. Such expenses shall include
the reasonable compensation, disbursements and expenses of the Trustee's agents
and counsel.
The Company and the Subsidiary Guarantors shall indemnify the
Trustee against any and all losses, liabilities or expenses incurred by it
arising out of or in connection with the acceptance or administration of its
duties under this Indenture, including the costs and expenses of enforcing this
Indenture against the Company and the Subsidiary Guarantors (including this
Section 7.7) and investigating or defending itself against any claim (whether
asserted by the Company, the Subsidiary Guarantors or any Holder or any other
person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence or bad faith. The Trustee shall
notify the Company and the Subsidiary Guarantors promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify the Company and the
Subsidiary
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Guarantors shall not relieve the Company and the Subsidiary Guarantors of their
obligations hereunder. The Company and the Subsidiary Guarantors shall defend
the claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Company and the Subsidiary Guarantors shall pay the
reasonable fees and expenses of such counsel. The Company and the Subsidiary
Guarantors need not pay for any settlement made without their consent, which
consent shall not be unreasonably withheld.
The obligations of the Company and the Subsidiary Guarantors
under this Section 7.7 are joint and several and shall survive the satisfaction
and discharge of this Indenture.
To secure the Company's and the Subsidiary Guarantors' payment
obligations in this Section, the Trustee shall have a Lien prior to the Notes on
all money or property held or collected by the Trustee, except that held in
trust to pay principal and interest on particular Notes. Such Lien shall survive
the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.1(9) or (10) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA section
313(b)(2) to the extent applicable.
Section 7.8. Replacement of Trustee.
-----------------------
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be
discharged from the trust hereby created by so notifying the Company. The
Holders of Notes of a majority in principal amount of the then outstanding Notes
may remove the Trustee by so notifying the Trustee and the Company in writing.
The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a Custodian or public officer takes charge of the
Trustee or its property; or
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(d) 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
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
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 Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note
who has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.7 hereof. Notwithstanding replacement of the Trustee pursuant
to this Section 7.8, the Company's obligations under Section 7.7 hereof shall
continue for the benefit of the retiring Trustee.
Section 7.9. Successor Trustee by Merger, etc.
---------------------------------
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. Eligibility; Disqualification.
------------------------------
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
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least $50 million as set forth in its most recent published annual report of
condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA sections 310(a)(1), (2) and (5). The Trustee is subject to
TIA sections 310(b).
Section 7.11. Preferential Collection of Claims Against
-----------------------------------------
Company.
--------
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1. Option to Effect Legal Defeasance or Covenant
---------------------------------------------
Defeasance.
-----------
The Company may, at the option of its Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any time,
elect to have either Section 8.2 or 8.3 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.
Section 8.2 Legal Defeasance and Discharge.
-------------------------------
Upon the Company's exercise under Section 8.1 hereof of the
option applicable to this Section 8.2, the Company and the Subsidiary Guarantors
shall, subject to the satisfaction of the conditions set forth in Section 8.4
hereof, be deemed to have been discharged from their obligations with respect to
all outstanding Notes and the Guarantees thereof on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Notes, which
shall thereafter be deemed to be "outstanding" only for the purposes of Section
8.5 hereof and the other Sections of this Indenture referred to in (a) and (b)
below, and to have satisfied all its other obligations under such Notes and this
Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, premium, if any, and interest on such
Notes when such payments are due from the trust fund described in Section 8.4
hereof, and as more fully set forth in such Section, (b) the Company's
obligations with respect to such Notes under Article 2 and Section 4.2 hereof,
(c) the rights, powers, trusts, duties
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and immunities of the Trustee hereunder and the Company's obligations in
connection therewith and (d) this Article 8. Subject to compliance with this
Article 8, the Company may exercise its option under this Section 8.2
notwithstanding the prior exercise of its option under Section 8.3 hereof.
Section 8.3. Covenant Defeasance.
--------------------
Upon the Company's exercise under Section 8.1 hereof of the
option applicable to this Section 8.3, the Company and the Subsidiary Guarantors
shall, subject to the satisfaction of the conditions set forth in Section 8.4
hereof, be released from their obligations under the covenants contained in
Sections 4.3, 4.5, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16 and 4.17
hereof and in clause (iv) of Section 5.1 and the covenants contained in the
Guarantees with respect to the outstanding Notes on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Notes shall thereafter be deemed not "outstanding" for the purposes of
any compliance certificate, direction, waiver, consent or declaration or act of
Holders (and the consequences of any thereof) in connection with such covenants,
but shall continue to be deemed "outstanding" for all other purposes hereunder
(it being understood that such Notes shall not be deemed outstanding for
accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Notes, the Company may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in
any such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 6.1 hereof, but, except as specified above, the remainder of this
Indenture, such Notes and such Guarantees shall be unaffected thereby. In
addition, upon the Company's exercise under Section 8.1 hereof of the option
applicable to this Section 8.3 hereof, subject to the satisfaction of the
conditions set forth in Section 8.4 hereof, Sections 6.1(3) (but only with
respect to the Company's failure to observe or perform the covenants, conditions
and agreements of the Company under clause (iv) of Section 5.1), 6.1(4), 6.1(7)
and 6.1(8) hereof shall not constitute Events of Default.
Section 8.4. Conditions to Legal or Covenant Defeasance.
-------------------------------------------
The following shall be the conditions to the application of
either Section 8.2 or 8.3 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
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(a) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders of the Notes, cash in United States
dollars, non-callable Government Securities, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any, and
interest, on the outstanding Notes 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;
(b) in the case of an election under Section 8.2 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.3 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit) or insofar
as Section 6.1(9) or 6.1(10) hereof is concerned, at any time in the period
ending on the 91st day after the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Opinion
of Counsel to the effect that after the 91st day following the deposit, the
trust funds will not be subject to the
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effect of any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally;
(g) the Company shall deliver to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders of the Notes over the other creditors of the Company,
or with the intent of defeating, hindering, delaying or defrauding creditors of
the Company or others; and
(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
Section 8.5. Deposited Money and Government Securities
-----------------------------------------
to be Held in Trust; Other Miscellaneous Provisions.
----------------------------------------------------
Subject to Section 8.6 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
8.5, the "Trustee") pursuant to Section 8.4 hereof in respect of the outstanding
Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company and the Subsidiary Guarantors shall pay and
indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the cash or non-callable Government Securities deposited
pursuant to Section 8.4 hereof or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or non-callable Government Securities held by
it as provided in Section 8.4 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.4(a) hereof), are in excess of the amount thereof that
would then be required to be deposited to effect an equivalent Legal Defeasance
or Covenant Defeasance.
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Section 8.6. Repayment to Company.
---------------------
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest on any Note and remaining unclaimed for two years after such
principal, premium, if any, or interest has become due and payable shall be paid
to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as a
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
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 the New York Times and The Wall Street Journal (national
edition), 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
notification or publication, any unclaimed balance of such money then remaining
shall be repaid to the Company.
Section 8.7. Reinstatement.
--------------
If the Trustee or Paying Agent is unable to apply any United
States dollars or non-callable Government Securities in accordance with Section
8.2 or 8.3 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the obligations of the Company and the Subsidiary
Guarantors under this Indenture, the Notes and the Guarantees shall be revived
and reinstated as though no deposit had occurred pursuant to Section 8.2 or 8.3
hereof, as the case may be; provided, however, that if the Company or any
Subsidiary Guarantor makes any payment of principal of, premium, if any, or
interest on any Note following the reinstatement of its obligations, the Company
or such Subsidiary Guarantor shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.1. Without Consent of Holders of Notes.
------------------------------------
Notwithstanding Section 9.2 of this Indenture, the Company,
the Subsidiary Guarantors and the Trustee may amend or supplement this
Indenture, the Notes or the Guarantees without the consent of any Holder of a
Note:
(a) to cure any ambiguity, defect or inconsistency;
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(b) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(c) to provide for the assumption of the Company's
obligations to the Holders of the Notes in the case of a merger
or consolidation pursuant to Article 5 hereof;
(d) to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights hereunder of any Holder of the
Note;
(e) to secure the Notes; or
(f) to comply with requirements of the Commission in order
to effect or maintain the qualification of this Indenture under
the TIA.
Upon the request of the Company accompanied by a resolution of
the Board of Directors of the Company and each of the Subsidiary Guarantors, as
the case may be, authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section
7.2 hereof, the Trustee shall join with the Company and the Subsidiary
Guarantors in the execution of any amended or supplemental indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee shall
not be obligated to enter into such amended or supplemental Indenture that
affects its own rights, duties or immunities under this Indenture or otherwise.
Section 9.2. With Consent of Holders of Notes.
---------------------------------
Except as provided below in this Section 9.2, the Company, the
Subsidiary Guarantors and the Trustee may amend or supplement this Indenture,
the Notes and the Guarantees with the consent of the Holders of at least a
majority in aggregate principal amount of the Notes then outstanding (including,
without limitation, consents obtained in connection with a purchase of, or
tender offer or exchange offer for the Notes), and, subject to Sections 6.4 and
6.7 hereof, any existing Default or Event of Default (other than a Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on the Notes, except a payment default resulting from an acceleration
that has been rescinded) or compliance with any provision of this Indenture, the
Notes or the Guarantees may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including, without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for the Notes).
Notwithstanding the foregoing, without the consent of at least
662/3% in aggregate principal amount of the Notes then
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outstanding (including consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes), no waiver or amendment to this
Indenture may make any change in the provisions of Sections 3.9, 4.10 and 4.13
hereof that adversely affect the rights of any Holder of Notes. In addition, any
amendment to the provisions of Article 10 of this Indenture shall require the
consent of the Holders of at least 66 2/3% in aggregate principal amount of the
Notes then outstanding if such amendment would adversely affect the rights of
Holders of Notes; provided that, no amendment may be made to the provisions of
Article 10 of this Indenture that adversely affects the rights of any holder of
Senior Debt then outstanding unless the holders of such Senior Debt (or any
group or representative thereof authorized to consent) consent to such change.
Subject to Sections 6.4 and 6.7 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Company or any Subsidiary Guarantor
with any provision of this Indenture, the Notes or the Guarantees. However,
without the consent of each Holder affected, an amendment or waiver may not
(with respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of
any Note or alter the provisions with respect to the redemption
of the Notes (except as provided above with respect to Sections
3.9, 4.10 and 4.13 hereof);
(c) reduce the rate of or change the time for payment of
interest on any Note;
(d) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest on the Notes (except
a rescission of acceleration of the Notes by the Holders of at
least a majority in principal amount of the Notes and a waiver of
the payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in
the Notes;
(f) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of
Notes to receive payments of principal or premium, if any, or
interest on the Notes; or
(g) make any change in the foregoing amendment and waiver
provisions.
Upon the request of the Company accompanied by a resolution of
the Board of Directors of the Company and each of
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the Subsidiary Guarantors, as the case may be, authorizing the execution of any
such amended or supplemental indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in Section
7.2 hereof, the Trustee shall join with the Company and the Subsidiary
Guarantors in the execution of such amended or supplemental indenture unless
such amended or supplemental indenture affects the Trustee's own rights, duties
or immunities under this indenture or otherwise, in which case the Trustee may
in its discretion, but shall not be obligated to, enter into such amended or
supplemental indenture.
It shall not be necessary for the consent of the Holders of
Notes under this Section 9.2 to approve the particular form of any proposed
amendment 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 of Notes 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 amended or
supplemental indenture or waiver.
Section 9.3. Compliance with Trust Indenture Act.
------------------------------------
Every amendment or supplement to this Indenture or the Notes
shall be set forth in an amended or supplemental Indenture that complies with
the TIA as then in effect.
Section 9.4. Revocation and Effect of Consents.
----------------------------------
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note 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 of a Note or subsequent Holder
of a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.5. Notation on or Exchange of Notes.
---------------------------------
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and the Trustee shall authenticate
new Notes that reflect the amendment, supplement or waiver.
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Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.6. Trustee to Sign Amendment, etc.
-------------------------------
The Trustee shall sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
Neither the Company nor any Subsidiary Guarantor may sign an amendment or
supplemental Indenture until its respective Board of Directors approves it. In
executing any amended or supplemental indenture, the Trustee shall be entitled
to receive and (subject to Section 7.1) shall be fully protected in relying
upon, an Officer's Certificate and an Opinion of Counsel stating that the
execution of such amended or supplemental indenture is authorized or permitted
by this Indenture and that there has been compliance with all conditions
precedent.
ARTICLE 10
SUBORDINATION
Section 10.1. Agreement to Subordinate.
-------------------------
The Company and each Subsidiary Guarantor agree, and each
Holder by accepting a Note and the related Guarantee agrees, that (i) the
Indebtedness evidenced by (a) the Notes, including, but not limited to, the
payment of principal of, premium, if any, and interest on the Notes, and any
other payment Obligation of the Company in respect of the Notes (including any
obligation to repurchase the Notes) is subordinated in right of payment, to the
extent and in the manner provided in this Article, to the prior payment in full
in cash of all Senior Debt of the Company (whether outstanding on the date
hereof or hereafter created, incurred, assumed or guaranteed), and (b) the
Guarantees and other payment Obligations in respect of the Guarantees are
subordinated in right of payment, to the extent and in the manner provided in
this Article, to the prior payment in full in cash of all Senior Debt of each
Subsidiary Guarantor and (ii) the subordination is for the benefit of the
Holders of Senior Debt.
Section 10.2. Certain Definitions.
--------------------
"Bankruptcy Law" means title 11, U.S. Code or any similar
Federal or state law for the relief of debtors.
"Representative" means the indenture trustee or other trustee,
agent or representative for any Senior Debt.
"Senior Debt" means (i) Indebtedness of the Company or any
Subsidiary of the Company under or in respect of any Credit Facility, whether
for principal, interest (including interest
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accruing after the filing of a petition initiating any proceeding pursuant to
any Bankruptcy Law, whether or not the claim for such interest is allowed as a
claim in such proceeding), reimbursement obligations, fees, commissions,
expenses, indemnities or other amounts and (ii) any other Indebtedness of the
Company or any Subsidiary of the Company permitted under the terms of this
Indenture, unless the instrument under which such Indebtedness is incurred
expressly provides that it is on a parity with or subordinated in right of
payment to the Notes. Notwithstanding anything to the contrary in the foregoing
sentence, Senior Debt will not include (w) any liability for federal, state,
local or other taxes owed or owing by the Company, (x) any Indebtedness of the
Company to any of its Subsidiaries or other Affiliates, (y) any trade payables
or (z) any Indebtedness that is incurred in violation of this Indenture (other
than Indebtedness under (i) any Credit Agreement or (ii) any other Credit
Facility that is incurred on the basis of a representation by the Company to the
applicable lenders that it is permitted to incur such Indebtedness under this
Indenture).
A "distribution" may consist of cash, securities or other
property, by set-off or otherwise.
All Designated Senior Debt now or hereafter existing and all
other Obligations relating thereto shall not be deemed to have been paid in full
unless the holders or owners thereof shall have received payment in full in cash
(or other form of payment consented to by the holders of such Designated Senior
Debt) with respect to such Designated Senior Debt and all other Obligations with
respect thereto.
Section 10.3. Liquidation; Dissolution; Bankruptcy.
-------------------------------------
(a) Upon any payment or distribution of property or securities
to creditors of the Company in a liquidation or dissolution of the Company or in
a bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property, or in an assignment for the benefit of
creditors or any marshalling of the Company's assets and liabilities:
(1) the holders of Senior Debt of the Company shall be
entitled to receive payment in full in cash of all Obligations in
respect of such Senior Debt (including interest after the commencement
of any such proceeding at the rate specified in the applicable Senior
Debt, whether or not a claim for such interest would be allowed in such
proceeding) before the Holders of Notes shall be entitled to receive
any payment with respect to the Notes and related Obligations (except
in each case that Holders of Notes may receive securities that are
subordinated at least to the same extent as the Notes to Senior Debt
and any securities issued in exchange for Senior Debt and payments made
from any defeasance trust created pursuant to Section 8.1 hereof
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provided that the applicable deposit does not violate Article 8 or 10
of this Indenture); and
(2) until all Obligations with respect to Senior Debt of the
Company (as provided in subsection (1) above) are paid in full in cash,
any payment or distribution to which the Holders of Notes and the
related Guarantees would be entitled shall be made to holders of Senior
Debt of the Company (except that Holders of Notes and the related
Guarantees may receive securities that are subordinated at least to the
same extent as the Notes to Senior Debt and any securities issued in
exchange for Senior Debt and payments made from any defeasance trust
created pursuant to Section 8.1 hereof provided that the applicable
deposit does not violate Article 8 or 10 of this Indenture).
(b) Upon any payment or distribution of property or securities
to creditors of a Subsidiary Guarantor in a liquidation or dissolution of such
Subsidiary Guarantor or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to such Subsidiary Guarantor or its
property, or in an assignment for the benefit of creditors or any marshalling of
such Subsidiary Guarantor's assets and liabilities:
(1) the holders of Senior Debt of such Subsidiary Guarantor
shall be entitled to receive payment in full in cash of all Obligations
in respect of such Senior Debt (including interest after the
commencement of any such proceeding at the rate specified in the
applicable Senior Debt, whether or not a claim for such interest would
be allowed in such proceeding) before the Holders of Notes and the
related Guarantees shall be entitled to receive any payment or
distribution with respect to the Guarantee made by such Subsidiary
Guarantor (except in each case that Holders of Notes and the related
Guarantees may receive securities that are subordinated at least to the
same extent as the Notes to Senior Debt and any securities issued in
exchange for Senior Debt and payments made from any defeasance trust
created pursuant to Section 8.1 hereof provided that the applicable
deposit does not violate Article 8 or 10 of this Indenture); and
(2) until all Obligations with respect to Senior Debt of such
Subsidiary Guarantor (as provided in subsection (1) above) are paid in
full in cash, any payment or distribution to which the Holders of Notes
and the related Guarantees would be entitled shall be made to holders
of Senior Debt of such Subsidiary Guarantor (except that Holders of
Notes and the related Guarantees may receive securities that are
subordinated at least to the same extent as the Notes to Senior Debt
and any securities issued in exchange for Senior Debt and payments made
from any defeasance trust created
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pursuant to Section 8.1 hereof provided that the applicable deposit
does not violate Article 8 or 10 of this Indenture).
Under the circumstances described in this Section 10.3, the
Company, any Subsidiary Guarantor or any receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar person making any payment or
distribution of cash or other property or securities is authorized or instructed
to make any payment or distribution to which the Holders of the Notes and the
related Guarantees would otherwise be entitled (other than securities that are
subordinated at least to the same extent as the Notes to Senior Debt and any
securities issued in exchange for Senior Debt and payments made from any
defeasance trust referred to in the second parenthetical clause of each of
clauses (a)(1), (b)(1), (c)(1), (a)(2), (b)(2) and (c)(2) above, which shall be
delivered or paid to the Holders of Notes as set forth in such clauses) directly
to the holders of the Senior Debt of the Company and any Subsidiary Guarantor,
as applicable, (pro rata to such holders on the basis of the respective amounts
of Senior Debt of the Company and any Subsidiary Guarantor, as applicable, held
by such holders) or their Representatives, or to any trustee or trustees under
any other indenture pursuant to which any such Senior Debt may have been issued,
as their respective interests appear, to the extent necessary to pay all such
Senior Debt in full, in cash or cash equivalents after giving effect to any
concurrent payment, distribution or provision therefor to or for the holders of
such Senior Debt.
To the extent any payment of or distribution in respect of
Senior Debt (whether by or on behalf of the Company or any Subsidiary Guarantor,
as proceeds of security or enforcement of any right of setoff or otherwise) is
declared to be fraudulent or preferential, set aside or required to be paid to
any receiver, trustee in bankruptcy, liquidating trustee, agent or other similar
Person under any bankruptcy, insolvency, receivership, fraudulent conveyance or
similar law, then if such payment or distribution is recovered by, or paid over
to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other
similar Person, the Senior Debt or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred. To the extent the obligation to repay any Senior Debt is
declared to be fraudulent, invalid or otherwise set aside under any bankruptcy,
insolvency, receivership, fraudulent conveyance or similar law, then the
obligation so declared fraudulent, invalid or otherwise set aside (and all other
amounts that would come due with respect thereto had such obligation not been so
affected) shall be deemed to be reinstated and outstanding as Senior Debt for
all purposes hereof as if such declaration, invalidity or setting aside had not
occurred.
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Section 10.4. Default on Designated Senior Debt.
----------------------------------
The Company and the Subsidiary Guarantors may not make any
payment (whether by redemption, purchase, retirements, defeasance or otherwise)
upon or in respect of the Notes and the related Guarantees (other than
securities that are subordinated at least to the same extent as the Notes to
Senior Debt and any securities issued in exchange for Senior Debt and payments
and other distributions made from any defeasance trust created pursuant to
Section 8.1 hereof if the applicable deposit does not violate Article 8 or 10 of
this Indenture) until all principal and other Obligations with respect to the
Senior Debt of the Company have been paid in full if:
(i) a default in the payment of any principal of,
premium, if any, or interest on Designated Senior Debt
occurs; or
(ii) any other default occurs and is continuing with
respect to Designated Senior Debt that permits, or with the giving of
notice or passage of time or both (unless cured or waived) would
permit, holders of the Designated Senior Debt as to which such default
relates to accelerate its maturity and the Trustee receives a notice of
the default (a "Payment Blockage Notice") from the Company or the
holders of any Designated Senior Debt. If the Trustee receives any such
Payment Blockage Notice, no subsequent Payment Blockage Notice shall be
effective for purposes of this Section unless and until 360 days shall
have elapsed since the date of commencement of the payment blockage
period resulting from the immediately prior Payment Blockage Notice. No
nonpayment default in respect of any Designated Senior Debt that
existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice.
The Company shall resume payments on and distributions in
respect of the Notes and any Subsidiary Guarantor shall resume making payments
and distributions pursuant to the Guarantees upon:
(1) in the case of a default referred to in Section
10.4(i) hereof the date upon which the default is cured or
waived, or
(2) in the case of a default referred to in Section 10.4(ii)
hereof, the earliest of (1) the date on which such nonpayment default
is cured or waived, (2) the date the applicable Payment Blockage Notice
is retracted by written notice to the Trustee and (3) 90 days after the
date on which the applicable Payment Blockage Notice is received unless
(A) the maturity of any Designated Senior Debt has been accelerated or
(B) a Default or Event of Default under Section 6.1(9) or (10) has
occurred and is continuing,
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if this Article otherwise permits the payment, distribution or acquisition at
the time of such payment or acquisition.
Section 10.5. Acceleration of Notes.
----------------------
If payment of the Notes is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Debt of the
acceleration.
Section 10.6. When Distribution Must Be Paid Over.
------------------------------------
In the event that the Trustee or any Holder receives any
payment or distribution of or in respect of any Obligations with respect to the
Notes or the Guarantees at a time when such payment or distribution is
prohibited by Section 10.3 or Section 10.4 hereof, such payment or distribution
shall be held by the Trustee (if the Trustee has actual knowledge that such
payment or distribution is prohibited by Section 10.3 or 10.4) or such Holder,
in trust for the benefit of, and shall be paid forthwith over and delivered to,
the holders of Senior Debt as their interests may appear or their Representative
under the indenture or other agreement (if any) pursuant to which such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of all Obligations with respect to Senior Debt
remaining unpaid to the extent necessary to pay such Obligations in full in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt.
With respect to the holders of Senior Debt, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt, and, except as provided in Section
10.12, shall not be liable to any such holders if the Trustee shall pay over or
distribute to or on behalf of Holders of Notes or the Company, the Subsidiary
Guarantors or any other Person money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 10, except if such payment is
made as a result of the willful misconduct or gross negligence of the Trustee.
Section 10.7. Notice by Company.
------------------
The Company and the Subsidiary Guarantors shall promptly
notify the Trustee and the Paying Agent of any facts known to the Company or any
Subsidiary Guarantor that would cause a payment of any Obligations with respect
to the Notes or the related Guarantees to violate this Article, but failure to
give such notice shall not affect the subordination of the Notes and the related
Guarantees to the Senior Debt as provided in this Article.
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Section 10.8 Subrogation.
------------
After all Senior Debt is paid in full and until the Notes are
paid in full, Holders of Notes and the related Guarantees shall be subrogated
(equally and ratably with all other Indebtedness pari passu with the Notes and
the Guarantees) to the rights of holders of Senior Debt to receive distributions
and payments applicable to Senior Debt to the extent that distributions and
payments otherwise payable to the Holders of Notes and the related Guarantees
have been applied to the payment of Senior Debt. A payment or distribution made
under this Article to holders of Senior Debt that otherwise would have been made
to Holders of Notes and the related Guarantees is not, as between the Company
and Holders of Notes, a payment by the Company on the Notes.
Section 10.9 Relative Rights.
----------------
This Article defines the relative rights of Holders of Notes
and the related Guarantees and holders of Senior Debt.
Nothing in this Indenture shall:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of Notes and the
related Guarantees and creditors of the Company other than their rights
in relation to holders of Senior Debt; or
(3) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Debt to receive distributions
and payments otherwise payable to Holders of Notes and the related
Guarantees.
If the Company fails because of this Article to pay principal
of or interest on a Note on the due date, the failure is still a Default or
Event of Default.
Section 10.10. Subordination May Not Be Impaired by
------------------------------------
Company or the Subsidiary Guarantors.
-------------------------------------
No right of any present or future holders of any Senior Debt
to enforce subordination as provided in this Article Ten will at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or any Subsidiary Guarantor or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Company or any
Subsidiary Guarantor with the terms of this Indenture, regardless of any
knowledge thereof that any such holder of Senior Debt may have or otherwise be
charged with. The provisions of this
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Article Ten are intended to be for the benefit of, and shall be enforceable
directly by, the holders of Senior Debt.
Section 10.11. Payment, Distribution or Notice to
----------------------------------
Representative.
---------------
Whenever a payment or distribution is to be made or a notice
given to holders of Senior Debt, the distribution may be made and the notice
given to their Representative.
Upon any payment or distribution of assets or securities of
the Company or any Subsidiary Guarantor referred to in this Article 10, the
Trustee and the Holders of Notes and the related Guarantees shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any payment or distribution to the Trustee or to
the Holders of Notes and the related Guarantees for the purpose of ascertaining
the Persons entitled to participate in such payment or distribution, the holders
of the Senior Debt and other Indebtedness of the Company or any Subsidiary
Guarantor, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 10.
Section 10.12. Rights of Trustee and Paying Agent.
-----------------------------------
Notwithstanding the provisions of this Article 10 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes and the Guarantees, unless the Trustee shall have
received at its Corporate Trust Office at least one Business Day prior to the
date of such payment written notice of facts that would cause the payment of any
Obligations with respect to the Notes or Guarantees to violate this Article,
which notice shall specifically refer to Section 10.3 or 10.4 hereof. Only the
Company or a Representative may give the notice. Nothing in this Article 10
shall impair the claims of, or payments to, the Trustee under or pursuant to
Section 7.7 hereof.
The Trustee in its individual or any other capacity may hold
Senior Debt with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights.
Section 10.13. Authorization to Effect Subordination.
--------------------------------------
Each Holder by the Holder's acceptance thereof authorizes and
directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 10, and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes. If the Trustee does not file a proper proof of
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claim or proof of debt in the form required in any proceeding referred to in
Section 6.9 hereof at least 30 days before the expiration of the time to file
such claim, each lender under the Credit Agreement is hereby authorized to file
an appropriate claim for and on behalf of the Holders of the Notes and the
related Guarantees.
Section 10.14. Amendments.
-----------
No amendment may be made to the provisions of or the
definitions of any terms appearing in this Article 10, or to the provisions of
Section 6.2 relating to the Designated Senior Debt, that adversely affects the
rights of any holder of Senior Debt then outstanding unless the holders of such
Senior Debt (or any group or Representative authorized to give a consent)
consent to such change.
Section 10.15. No Waiver of Subordination Provisions.
--------------------------------------
Without in any way limiting the generality of Section 10.9 of
this Indenture, the holders of Senior Debt may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Holders and without impairing or releasing the
subordination provided in this Article Ten or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding or secured; (b) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (c) release any Person liable in any manner for the
collection of Senior Debt; and (d) exercise or refrain from exercising any
rights against the Company and each Subsidiary Guarantor and any other Person.
ARTICLE 11
THE GUARANTEES
Section 11.1. The Guarantees.
---------------
Each of the Subsidiary Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of and premium and interest, on the Notes shall be promptly paid in full when
due, whether at maturity, by acceleration, redemption or otherwise, and interest
on the overdue principal of and interest on premium and interest, on the Notes,
if any, if lawful, and all other obligations of the Company to the Holders or
the Trustee hereunder or thereunder shall be promptly paid in
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full or performed, all in accordance with the terms hereof and thereof; and (b)
in case of any extension of time of payment or renewal of any Notes or any of
such other obligations, that the same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. Failing payment when due of any
amount so guaranteed or any performance so guaranteed for whatever reason, the
Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately. The Subsidiary Guarantors hereby agree that their obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder with respect to any
provisions hereof or thereof, the recovery of any judgment against the Company,
any action to enforce the same or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a guarantor. Each of the
Subsidiary Guarantors hereby waives diligence, presentment, demand of payment,
filing of claims with a court in the event of insolvency or bankruptcy of the
Company, any right to require a proceeding first against the Company, protest,
notice and all demands whatsoever and covenant that this Guarantee shall not be
discharged except by complete performance of the obligations contained in the
Notes and this Indenture. If any Holder or the Trustee is required by any court
or otherwise to return to the Company or the Subsidiary Guarantors, or any
Custodian, Trustee, liquidator or other similar official acting in relation to
either the Company or the Subsidiary Guarantors, any amount paid by either to
the Trustee or such Holder, this Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. Each of the Subsidiary
Guarantors agrees that it shall not be entitled to any right of subrogation in
relation to the Holders of Notes in respect of any obligations guaranteed hereby
until payment in full of all obligations guaranteed hereby. Each of the
Subsidiary Guarantors further agrees that, as between the Subsidiary Guarantors,
on the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article 6 for the purposes of this Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6, such obligations
(whether or not due and payable) shall forthwith become due and payable by the
Subsidiary Guarantors for the purpose of this Guarantee. The Subsidiary
Guarantors shall have the right to seek contribution from any Subsidiary
Guarantor not paying so long as the exercise of such right does not impair the
rights of the Holders under the Guarantees.
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Section 11.2. Execution and Delivery of Guarantees.
-------------------------------------
(i) To evidence its Guarantee set forth in Section 11.1, each
of the Subsidiary Guarantors hereby agrees that a notation of such Guarantee
substantially in the form of Exhibit C shall be endorsed by an officer of such
Subsidiary Guarantor on each Note authenticated and delivered by the Trustee,
that this Indenture shall be executed on behalf of such Subsidiary Guarantor by
its President or one of its Vice Presidents and attested to by an Officer and
that such Subsidiary Guarantor shall deliver to the Trustee an Opinion of
Counsel that the foregoing have been duly authorized, executed and delivered by
such Subsidiary Guarantor and that such Guarantee is a valid and legally binding
obligation of such Subsidiary Guarantor, enforceable against such Subsidiary
Guarantor in accordance with its terms.
Each Subsidiary Guarantor hereby agrees that its Guarantee set
forth in Section 11.1 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Guarantee.
If an Officer whose signature is on this Indenture or on the
applicable Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which such Guarantee is endorsed, such Guarantee shall
be valid nevertheless.
The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Guarantees set forth in this Indenture on behalf of the Subsidiary Guarantors.
Section 11.3. Subsidiary Guarantors May Consolidate,
--------------------------------------
etc., on Certain Terms.
-----------------------
No Subsidiary Guarantor may consolidate with or merge with or
into (whether or not such Subsidiary Guarantor is the Surviving Person), another
Person, whether or not affiliated with such Subsidiary Guarantor, unless:
(a) subject to the provisions of Section 11.4 hereof, the
Person formed by or surviving any such consolidation or merger (if
other than such Subsidiary Guarantor) assumes all the obligations of
such Subsidiary Guarantor pursuant to a supplemental indenture in form
reasonably satisfactory to the Trustee in respect of the Notes, this
Indenture and such Subsidiary Guarantor's Guarantee;
(b) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(c) such transaction does not violate any of Sections 4.3,
4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16 and 4.17.
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Notwithstanding the foregoing, none of the Subsidiary Guarantors shall be
permitted to consolidate with or merge with or into (whether or not such
Subsidiary Guarantor is the surviving Person), another corporation, Person or
entity pursuant to the preceding sentence if such consolidation or merger would
not be permitted by Section 5.1 hereof.
In case of any such consolidation or merger and upon the
assumption by the successor corporation, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by such
Subsidiary Guarantor, such successor corporation shall succeed to and be
substituted for such Subsidiary Guarantor with the same effect as if it had been
named herein as a Subsidiary Guarantor. Such successor corporation thereupon may
cause to be signed any or all of the Guarantees to be endorsed upon all of the
Notes issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Trustee. All the Guarantees so issued shall in all
respects have the same legal rank and benefit under this Indenture as the
Guarantees theretofore and thereafter issued in accordance with the terms of
this Indenture as though all of such Guarantees had been issued at the date of
the execution hereof.
Except as set forth in Articles 4 and 5 hereof, nothing
contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of any Subsidiary Guarantor with or into the Company or
another Subsidiary Guarantor, or shall prevent any sale or conveyance of the
property of any Subsidiary Guarantor as an entirety or substantially as an
entirety to the Company or any Subsidiary Guarantor.
Section 11.4. Releases of Guarantees.
-----------------------
In the event of a sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor or a sale or other
disposition of all of the capital stock of any Subsidiary Guarantor, to any
corporation or other Person (including an Unrestricted Subsidiary) by way of
merger, consolidation, or otherwise, in a transaction that does not violate any
of the covenants of this Indenture, then such Subsidiary Guarantor (in the event
of a sale or other disposition, by way of such merger, consolidation or
otherwise, of all the capital stock of such Subsidiary Guarantor) shall be
released and relieved of any obligations under its Guarantee and such acquiring
corporation or other Person (in the event of a sale or other disposition of all
or substantially all of the assets of such Subsidiary Guarantor), if other than
a Subsidiary Guarantor, shall have no obligation to assume or otherwise become
liable under such Guarantee; provided, that the Net Proceeds of such sale or
other disposition are applied in accordance with Section 4.10 hereof. Upon
delivery by the Company to the Trustee
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of an Officers' Certificate and an Opinion of Counsel to the effect that such
sale or other disposition was made by the Company in accordance with the
provisions of this Indenture, including without limitation Section 4.10, the
Trustee shall execute any documents reasonably required in order to evidence the
release of any Subsidiary Guarantor from its obligations under its Guarantee.
Any Subsidiary Guarantor not released from its obligations
under its Guarantee shall remain liable for the full amount of principal of and
interest on the Notes and for the other obligations of such Subsidiary Guarantor
under this Indenture as provided in this Article 11.
Any Subsidiary Guarantor that is designated an Unrestricted
Subsidiary in accordance with the terms of this Indenture shall be released from
and relieved of its obligations under its Guarantee and any Unrestricted
Subsidiary that becomes a Restricted Subsidiary and any newly created or newly
acquired Subsidiary that is or becomes a Subsidiary shall be required to execute
a Guarantee in accordance with the terms of this Indenture.
Section 11.5. Limitation on Subsidiary Guarantor Liability.
---------------------------------------------
For purposes hereof, each Subsidiary Guarantor's liability
shall be that amount from time to time equal to the aggregate liability of such
Subsidiary Guarantor thereunder, but shall be limited to the lesser of (i) the
aggregate amount of the Obligations of the Company under the Notes and this
Indenture and (ii) the amount, if any, which would not have (A) rendered such
Subsidiary Guarantor "insolvent" (as such term is defined in the federal
Bankruptcy Law and in the Debtor and Creditor Law of the State of New York) or
(B) left it with unreasonably small capital at the time its Guarantee of the
Notes was entered into, after giving effect to the incurrence of existing
Indebtedness immediately prior to such time; provided that, it shall be a
presumption in any lawsuit or other proceeding in which such Subsidiary
Guarantor is a party that the amount guaranteed pursuant to its Guarantee is the
amount set forth in clause (i) above unless any creditor, or representative of
creditors of such Subsidiary Guarantor, or debtor in possession or trustee in
bankruptcy of such Subsidiary Guarantor, otherwise proves in such a lawsuit that
the aggregate liability of such Subsidiary Guarantor is limited to the amount
set forth in clause (ii). In making any determination as to the solvency or
sufficiency of capital of a Subsidiary Guarantor in accordance with the previous
sentence, the right of such Subsidiary Guarantor to contribution from other
Subsidiary Guarantors and any other rights such Subsidiary Guarantor may have,
contractual or otherwise, shall be taken into account.
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Section 11.6. "Trustee" to Include Paying Agent.
----------------------------------
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in Article 10 and this Article 11 shall in such case (unless
the context shall otherwise require) be construed as extending to and including
such Paying Agent within its meaning as fully and for all intents and purposes
as if such Paying Agent were named in Article 10 and this Article 11 in place of
the Trustee.
Section 11.7. Subordination of Guarantees.
----------------------------
The obligations of each of the Subsidiary Guarantors under its
Guarantee pursuant to this Article 11 shall be junior and subordinated to the
Senior Debt of the Subsidiary Guarantor pursuant to Article 10 hereof. For the
purposes of the foregoing sentence, the Trustee and the Holders shall have the
right to receive and/or retain payments or distributions by or on behalf of any
of the Subsidiary Guarantors only at such times as they may receive and/or
retain payments in respect of the Notes pursuant to this Indenture, including
Article 10 hereof.
ARTICLE 12
MISCELLANEOUS
Section 12.1. Trust Indenture Act Controls.
-----------------------------
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA ss. 318(c), the imposed duties shall
control. If any provisions of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, the letter provision shall be
deemed to apply to this Indenture as so modified or excluded, as the case may
be.
Section 12.2. Notices.
--------
Any notice or communication by the Company or the Subsidiary
Guarantors or the Trustee to the others is duly given if in writing and
delivered in Person or mailed by first class mail (registered or certified,
return receipt requested), telecopier or overnight air courier guaranteeing next
day delivery, to the others' address:
If to the Company or any Subsidiary Guarantor:
Lomak Petroleum, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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With a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: J. ▇▇▇▇ ▇▇▇▇▇
If to the Trustee:
Telecopier No.:
Attention: Indenture Trust Administration
Division
The Company or any Subsidiary Guarantor or the Trustee, by
notice to the others may designate additional or different addresses for
subsequent notices or communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if by telecopy; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA ss. 313(c), to the extent required by the
TIA. Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company or any Subsidiary Guarantor mails a notice or
communication to Holders, it shall mail a copy to the Trustee and each Agent at
the same time.
Section 12.3. Communication by Holders of Notes with
--------------------------------------
Other Holders of Notes.
-----------------------
Holders may communicate pursuant to TIA ss. 312(b) with
other Holders with respect to their rights under this Indenture
or the Notes. The Company, the Subsidiary Guarantors, the
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Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
Section 12.4. Certificate and Opinion as to Conditions
----------------------------------------
Precedent.
----------
Upon any request or application by the Company or any
Subsidiary Guarantor to the Trustee to take any action under this Indenture, the
Company or such Subsidiary Guarantor, as the case may be, shall furnish to the
Trustee:
(a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include the
statements set forth in Section 12.5 hereof) stating that, in the
opinion of the signers, all conditions precedent and covenants,
if any, provided for in this Indenture relating to the proposed
action have been complied with; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements
set forth in Section 12.5 hereof) stating that, in the opinion of
such counsel, all such conditions precedent and covenants have
been complied with.
Section 12.5. Statements Required in Certificate or
-------------------------------------
Opinion.
--------
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he or
she has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
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Section 12.6. Rules by Trustee and Agents.
----------------------------
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
Section 12.7. No Personal Liability of Directors, Officers,
---------------------------------------------
Employees and Stockholders.
---------------------------
No director, officer, employee, incorporator or stockholder of
the Company, as such, shall have any liability for any obligations of the
Company under the Notes or this Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of Notes,
by accepting a Note, waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. Such waiver may
not be effective to waive liabilities under the federal securities laws and it
is the view of the Commission that such a waiver is against public policy.
Section 12.8. Governing Law.
--------------
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES.
Section 12.9. No Adverse Interpretation of Other Agreements.
----------------------------------------------
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or their respective
Subsidiaries or of any other Person. Any such indenture, loan or debt agreement
may not be used to interpret this Indenture and the Guarantees.
Section 12.10. Successors.
-----------
All agreements of the Company and each Subsidiary Guarantor in
this Indenture, the Notes and the Guarantees shall bind its respective
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 12.11. Severability.
-------------
In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
88
88
Section 12.12. Counterpart Originals.
----------------------
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
Section 12.13. Table of Contents, Headings, Etc.
---------------------------------
The Table of Contents, Cross-Reference Table and Headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
89
89
SIGNATURES
Dated as of
___________, 1997
LOMAK PETROLEUM, INC.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK OPERATING COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK PRODUCTION COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK RESOURCES COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
BUFFALO OILFIELD SERVICES, INC.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK ENERGY SERVICES COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
90
90
LOMAK ENERGY COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LPI ACQUISITION, INC.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK PRODUCTION I, L.P.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK RESOURCES, L.L.C.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK OFFSHORE I, L.P.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK PIPELINE SYSTEMS, L.P.
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
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91
LOMAK GATHERING & PROCESSING
COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
LOMAK GAS COMPANY
Attest: By________________________________
Name:______________________________
__________________________ Title:_____________________________
92
================================================================================
EXHIBIT A
(Face of Note)
_____% Senior Subordinated Notes due 2007
No. $__________
Cusip Number:
LOMAK PETROLEUM, INC.
promises to pay to
or registered assigns,
the principal sum of
DOLLARS on ___________, 2007.
Interest Payment Dates: _____________ and ____________
Record Dates: __________________ and ___________________
Dated: _______________, ____
LOMAK PETROLEUM, INC.
By_______________________
Name:
Title:
By_______________________
Name:
Title:
This is one of the Notes referred
to in the within-mentioned (SEAL)
Indenture:
[Name of Trustee],
as Trustee
By____________________________
Authorized Signatory
================================================================================
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(Back of Note)
____% Senior Subordinated Note due 2007
Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Lomak Petroleum, Inc., a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Note at the rate of
____% per annum, which interest shall be payable in cash semiannually in arrears
on _________________ and __________________, or if any such day is not a
Business Day, on the next succeeding Business Day (each an "Interest Payment
Date"); provided that the first Interest Payment Date shall be ________________,
1997. 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
original issuance. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.
2. METHOD OF PAYMENT. On each Interest Payment Date the
Company will pay interest to the Person who is the Holder of record of this Note
as of the close of business on the ________________ or ________________
immediately preceding such Interest Payment Date, even if this Note is cancelled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
Principal, premium if any and interest on this Note will be payable at the
office or agency of the Company maintained for such purpose within the City and
State of New York or, in the event the Notes do not remain in book-entry form,
at the option of the Company, payment of interest, may be made by check mailed
to the Holder of this Note at its address set forth in the register of Holders
of Notes; provided that all payments with respect to the Global Notes and
definitive Notes having an aggregate principal amount of $5.0 million or more
the Holders of which have given wire transfer instructions to the Company at
least 10 Business Days prior to the applicable payment date will be required to
be made by wire transfer of immediately available funds to the accounts
specified by the Holders thereof. Such payment shall be in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially,
______________________________________, the Trustee under the Indenture, will
act as Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to any
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Holder. The Company or any Subsidiary Guarantor or any other of the Company's
Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture
dated as of ________________, 1997 ("Indenture") among the Company, the
Subsidiary Guarantors and the Trustee. 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 amended (15 U.S. Code Sections 77aaa-77bbbb).
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. The Notes are general
unsecured obligations of the Company equal in an aggregate principal amount to
$100,000,000 and will mature on ____________, 2007.
5. OPTIONAL REDEMPTION.
(a) The Notes are not redeemable at the Company's option prior
to __________________, 2002. From and after ___________________, 2002, the Notes
will be subject to redemption at the option of the Company, in whole or in part,
upon not less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest thereon to the applicable redemption date, if redeemed during
the twelve-month period beginning on ____________ of the years indicated below:
YEAR PERCENTAGE
---- ----------
2002......................................... %
2003......................................... %
2004 ........................................ %
2005 and thereafter ......................... 100.000%
(b) Notwithstanding the provisions of clause (a) of this
Paragraph 5, prior to ________________, 2000 the Company may, at its option, on
any one or more occasions, redeem up to $33,333,000 in aggregate principal
amount of Notes at a redemption price equal to ____% of the principal amount
thereof, plus accrued and unpaid interest, if any, thereon to the redemption
date, with the net proceeds of sales of Equity Interests (other than
Disqualified Stock) of the Company; provided that at least $66,667,000 in
aggregate principal amount of Notes must remain outstanding immediately after
the occurrence of such redemption; and provided, further, that any such
redemption shall occur within 60 days after the date of the closing of the
related sale of such Equity Interests.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to the Notes.
▇-▇
▇▇
▇. ▇▇▇▇▇▇▇▇▇▇ AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, each Holder of
Notes shall have the right to require the Company to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of such Holder's Notes
pursuant to the offer described below (the "Change of Control Offer") at an
offer price in cash equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest, if any, thereon to the date of purchase (the
"Change of Control Payment"). The right of the Holders of the Notes to require
the Company to repurchase such Notes upon a Change of Control may not be waived
by the Trustee without the approval of the Holders of the Notes required by
Section 9.2 of the Indenture. Within 30 days following any Change of Control,
the Company will mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
Notes pursuant to the procedures required by the Indenture and described in such
notice. The Change of Control Payment shall be made on a business day not less
than 30 days nor more than 60 days after such notice is mailed. The Company and
each Subsidiary Guarantor will comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change of Control.
(b) If the Company or a Restricted Subsidiary consummates any
Asset Sales permitted by the Indenture, when the aggregate amount of Excess
Proceeds exceeds $5.0 million, the Company shall make an Asset Sale Offer to
purchase the maximum principal amount of Notes and any other Pari Passu
Indebtedness to which the Asset Sale Offer applies that may be purchased out of
the Excess Proceeds, at an offer price in cash in an amount equal to, in the
case of the Notes, 100% of the principal amount thereof, plus accrued and unpaid
interest thereon to the date of purchase or, in the case of any Pari Passu
Indebtedness, 100% of the principal amount thereof (or with respect to discount
Pari Passu Indebtedness, the accreted value thereof) on the date of purchase, in
each case, in accordance with the procedures set forth in Section 3.9 of the
Indenture or the agreements governing the Pari Passu Indebtedness, as
applicable. To the extent that the aggregate principal amount (or accreted
value, as the case may be) of Notes, and Pari Passu Indebtedness tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company
may use any remaining Excess Proceeds for general corporate purposes. If the sum
of (i) the aggregate principal amount of Notes surrendered by Holders thereof
and (ii) the aggregate principal amount or accreted value, as the case may be,
of Pari Passu Indebtedness surrendered by holders or lenders thereof exceeds the
amount of Excess Proceeds, the Trustee and the trustee or other lender
representative for the Pari Passu Indebtedness shall select the Notes and the
other Pari Passu
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96
Indebtedness to be purchased on a pro rata basis, based on the aggregate
principal amount (or accreted value, as applicable) thereof surrendered in such
Asset Sale Offer. Upon completion of such Asset Sale Offer, the amount of Excess
Proceeds shall be reset at zero.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed
at least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes or
on the aggregate principal amount of the Notes called for redemption, as the
case may be.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes may be issued
initially in the form of one or more fully registered Global Notes. The Notes
may also be issued in registered form without coupons in minimum denominations
of $1,000 and integral multiples of $1,000. The transfer of Notes may be
registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, it need not exchange or register the transfer of
any Note for a period of 15 days before a selection of Notes to be redeemed or
during the period between a record date and the corresponding Interest Payment
Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a
Note may be treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or the tender offer or exchange offer for, such
Notes), and any existing Default or Event of Default under, or compliance with
any provision of the Indenture or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes.
Without the consent of any Holder of a Note, the Indenture or the Notes may be
amended or supplemented to cure any ambiguity, defect or inconsistency, to
provide for uncertificated Notes in addition to or in place of certificated
Notes, to provide for the assumption of the Company's obligations to Holders of
the Notes in case of a merger or consolidation, to make any change that
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97
would provide any additional rights or benefits to the Holders of the Notes or
that does not adversely affect the legal rights under the Indenture of any such
Holder, or to comply with the requirements of the Commission in order to effect
or maintain the qualification of the Indenture under the Trust Indenture Act.
12. DEFAULTS AND REMEDIES. Events of Default include: (i)
default for 30 consecutive days in the payment when due of interest on the Notes
(whether or not prohibited by the provisions of Article 10 of the Indenture);
(ii) default in payment when due of the principal of or premium, if any, on the
Notes (whether or not prohibited by the provisions of Article 10 of the
Indenture); (iii) failure by the Company to comply with the provisions of
Article 5 of the Indenture; (iv) failure by the Company for 30 consecutive days
after notice from the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding to comply with the provisions of
Sections 4.3, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16, and 4.17 of the
Indenture; (v) failure by the Company for 60 consecutive days after notice from
the Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding to comply with any of its other agreements or covenants
in, or provisions of, this Note or in the Indenture; (vi) except as permitted by
the Indenture, any Guarantee shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full force and
effect or a Subsidiary Guarantor or any Person acting on behalf of a Subsidiary
Guarantor, shall deny or disaffirm such Subsidiary Guarantor's obligations under
its Guarantee; (vii) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any Restricted Subsidiary
whether such Indebtedness or guarantee now exists, or is created after the date
of the Indenture, which default (a) is caused by a failure to pay principal of
or premium, if any, or interest on such Indebtedness prior to the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there is then existing a Payment Default or the maturity of which
has been so accelerated, aggregates $10.0 million or more; provided, that if any
such default is cured or waived or any such acceleration rescinded, or such
indebtedness is repaid, within a period of 10 days from the continuation of such
default beyond the applicable grace period or the occurrence of such
acceleration, as the case may be, such Event of Default under the Indenture and
any consequential acceleration of the Notes shall be automatically
rescinded;(viii) a final non-appealable judgment or order or final
non-appealable judgments or orders are rendered against the Company or any
Restricted Subsidiary that remain unpaid or discharged for a period of 60 days
and that require the
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payment in money, either individually or in an aggregate amount, that is more
than $5.0 million; and (ix) certain events of bankruptcy or insolvency with
respect to the Company or any Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary. If
any Event of Default (other than an Event of Default described in clause (x)
above) occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or insolvency with
respect to the Company or any Subsidiary Guarantor, all outstanding Notes will
become due and payable without further action or notice. Holders of the Notes
may not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of the
then outstanding Notes may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate
principal amount of the Notes then outstanding by notice to the Trustee may on
behalf of the Holders of all of the Notes waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest or premium on, or the principal of,
the Notes. The Company is required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Company is required,
within 5 Business days after becoming aware of any Default or Event of Default,
to deliver to the Trustee a statement specifying such Default or Event of
Default.
13. SUBORDINATION. The Notes are subordinated to Senior Debt
of the Company. To the extent provided in the Indenture, Senior Debt must be
paid before the Notes may be paid. The Company agrees, and each Holder by
accepting a Note agrees, that the Indebtedness evidenced by the Notes,
including, but not limited to, the payment of principal of, premium, if any, and
interest on the Notes, and any other payment Obligation of the Company in
respect of the Notes is subordinated in right of payment, to the extent and in
the manner provided in the Indenture, to the prior payment in full in cash of
all Senior Debt of the Company (whether outstanding on the date hereof or
hereafter created, incurred, assumed or guaranteed) and authorizes the Trustee
to give effect and appoints the Trustee as attorney-in-fact for such purpose.
14. TRUSTEE DEALINGS WITH COMPANY. The Indenture contains
certain limitations on the rights of the Trustee, should it become a creditor of
the Company, to obtain payment of claims in certain cases, or to realize on
certain property received in
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respect of any such claim as security or otherwise. The Trustee will be
permitted to engage in other transactions; however, if it acquires any
conflicting interest it must eliminate such conflict within 90 days, apply to
the Commission for permission to continue or resign.
15. NO RECOURSE AGAINST OTHERS. No director, officer,
employee, incorporator or stockholder of the Company, as such, shall have any
liability for any obligations of the Company 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 Notes, by accepting a Note, waives and releases
all such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the Commission that such
a waiver is against public policy.
16. AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
17. ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder 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.
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder upon written request
and without charge a copy of the Indenture. Requests may be made to:
Lomak Petroleum, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Secretary
[NOTE: THE FORM OF GUARANTEE ATTACHED AS EXHIBIT C TO THE INDENTURE IS TO BE
ATTACHED TO THIS NOTE.]
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ASSIGNMENT FORM
To assign this Security, fill in the form below: (I) or
(we) assign and transfer this Security to
-------------------------------------------------------------------------------
(Insert assignee's Social Security or tax I.D. No.)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
agent to transfer this Security on the books of the Company. The
agent may substitute another to act for him.
-------------------------------------------------------------------------------
Date:
------------------
Your Signature:
----------------------------
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:*
-----------------------
--------
*/ Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor acceptable to the
Trustee).
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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 4.10 or 4.13 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.13
If you want to elect to have only part of the Note purchased
by the Company pursuant to Section 4.10 or Section 4.13 of the Indenture, state
the principal amount you elect to have purchased: $______________
Date: Your Signature:
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:*
-----------------------
--------
*/ Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor acceptable to the
Trustee).
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EXHIBIT B
(Form of Legend for Global 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 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 Trust Company (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"),
to the issuer 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 DTC (and any payment
is made to Cede & Co. or such other entity as may be requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
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SCHEDULE OF EXCHANGES OF DEFINITIVE NOTES
[To be attached to Global Note]
The following exchanges of a part of this Global Note for
definitive Notes have been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global authorized
Principal Amount Principal Amount Note following officer of
Date of of this Global of this Global such decrease Trustee or Note
Exchange Note Note (or increase) Custodian
-------- ---- ---- ------------- ---------
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EXHIBIT C
Guarantee
Each of the Subsidiary Guarantors, if any, hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of and premium and interest on the Notes shall be promptly paid in full when
due, whether at maturity, by acceleration, redemption or otherwise, and interest
on the overdue principal of and interest on premium and interest on the Notes,
if any, if lawful, and all other obligations of the Company to the Holders or
the Trustee hereunder or thereunder shall be promptly paid in full or performed,
all in accordance with the terms hereof and thereof; and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, that same shall be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason and the
Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately.
The obligations of the Subsidiary Guarantors to the Holders of
Notes and to the Trustee pursuant to this Guarantee and the Indenture (including
the subordination provisions thereof) are expressly set forth in Article 11 of
the Indenture, and reference is hereby made to such Indenture for the precise
terms of this Guarantee. The terms of Article 11 of the Indenture are
incorporated herein by reference.
This is a continuing Guarantee and shall remain in full force
and effect and shall be binding upon each of the Subsidiary Guarantors and its
respective successors and assigns to the extent set forth in the Indenture until
full and final payment of all of the Company's Obligations under the Notes and
the Indenture and shall inure to the benefit of the Trustee and the Holders of
Notes and their successors and assigns and, in the event of any transfer or
assignment of rights by any Holder of Notes or the Trustee, the rights and
privileges herein conferred upon that party shall automatically extend to and be
vested in such transferee or assignee, all subject to the terms and conditions
hereof. Notwithstanding the foregoing, any Subsidiary Guarantor that satisfies
the provisions of Section 11.4 of the Indenture shall be released of its
obligations hereunder. This is a Guarantee of payment and not a guarantee of
collection.
This Guarantee shall not be valid or obligatory for any
purpose until the certificate of authentication on the Note upon
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105
which this Guarantee is noted shall have been executed by the Trustee under the
Indenture by the manual signature of one of its authorized officers.
For purposes hereof, each Subsidiary Guarantor's liability
will be that amount from time to time equal to the aggregate liability of such
Subsidiary Guarantor hereunder but shall be limited to the lesser of (i) the
aggregate amount of the obligations of the Company under the Notes and the
Indenture and (ii) the amount, if any, which would not have (A) rendered such
Subsidiary Guarantor "insolvent" (as such term is defined in the federal
Bankruptcy Law and in the Debtor and Creditor law of the State of New York) or
(B) left it with unreasonably small capital at the time its Guarantee of the
Notes was entered into, after giving effect to the incurrence of existing
Indebtedness immediately prior to such time; provided that, it shall be a
presumption in any lawsuit or other proceeding in which such Subsidiary
Guarantor is a party that the amount guaranteed pursuant to its Guarantee is the
amount set forth in clause (i) above unless any creditor, or representative of
creditors of such Subsidiary Guarantor, or debtor in possession or trustee in
bankruptcy of such Subsidiary Guarantor, otherwise proves in such a lawsuit that
the aggregate liability of such Subsidiary Guarantor is limited to the amount
set forth in clause (ii). The Indenture provides that, in making any
determination as to the solvency or sufficiency of capital of a Subsidiary
Guarantor in accordance with the previous sentence, the right of such Subsidiary
Guarantor to contribution from other Subsidiary Guarantors and any other rights
such Subsidiary Guarantor may have, contractual or otherwise, shall be taken
into account.
Capitalized terms used herein have the same meanings given in
the Indenture unless otherwise indicated.
LOMAK OPERATING COMPANY,
a Texas corporation
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK PRODUCTION COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
▇-▇
▇▇▇
▇▇▇▇▇ RESOURCES COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
BUFFALO OILFIELD SERVICES, INC.
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK ENERGY SERVICES COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK ENERGY COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
LPI ACQUISITION, INC.
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK PRODUCTION I, L.P.
By:_____________________________________
Name:___________________________________
Title:__________________________________
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107
LOMAK RESOURCES, L.L.C.
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK OFFSHORE I, L.P.
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK PIPELINE SYSTEMS, L.P.
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK GATHERING & PROCESSING COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
LOMAK GAS COMPANY
By:_____________________________________
Name:___________________________________
Title:__________________________________
C-4
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Draft - 2/11/97
================================================================================
LOMAK PETROLEUM, INC.
As Issuer
LOMAK OPERATING COMPANY
LOMAK PRODUCTION COMPANY
LOMAK RESOURCES COMPANY
BUFFALO OILFIELD SERVICES, INC.
LOMAK ENERGY SERVICES COMPANY
LOMAK ENERGY COMPANY
LPI ACQUISITION, INC.
LOMAK PRODUCTION I, L.P.
LOMAK RESOURCES, L.L.C.
LOMAK OFFSHORE I,L.P.
LOMAK PIPELINE SYSTEMS, L.P.
LOMAK GATHERING & PROCESSING COMPANY
LOMAK GAS COMPANY
As Guarantors
____% SENIOR SUBORDINATED NOTES DUE 2007
------------------
INDENTURE
Dated as of ____________, 1997
------------------
------------------
FLEET NATIONAL BANK
As Trustee
------------------
109
================================================================================
110
CROSS-REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
310 (a)(1).................................................................................... 7.10
(a)(2).................................................................................... 7.10
(a)(3).................................................................................... N.A.
(a)(4).................................................................................... N.A.
(a)(5).................................................................................... 7.10
(b)....................................................................................... 7.10
(c)....................................................................................... N.A.
311 (a)....................................................................................... 7.11
(b)....................................................................................... 7.11
(c)....................................................................................... N.A.
312 (a)....................................................................................... 2.5
(b)....................................................................................... 12.3
(c)....................................................................................... 12.3
313 (a)....................................................................................... 7.6
(b)(1).................................................................................... N.A.
(b)(2).................................................................................... 7.7
(c)....................................................................................... 7.6; 12.2
(d)....................................................................................... 7.6
314 (a)....................................................................................... 4.3; 12.2
(b)....................................................................................... N.A.
(c)(1).................................................................................... 12.4
(c)(2).................................................................................... 12.4
(c)(3).................................................................................... N.A.
(d)....................................................................................... 10.3-10.5
(e)....................................................................................... 12.5
(f)....................................................................................... N.A.
315 (a)....................................................................................... 7.1
(b)....................................................................................... 7.5; 12.2
(c)....................................................................................... 7.1
(d)....................................................................................... 7.1
(e)....................................................................................... 6.11
316 (a)(last sentence)........................................................................ 2.9
(a)(1)(A)..............................................................................6.5
(a)(1)(B)..............................................................................6.4
(a)(2).................................................................................... N.A.
(b)....................................................................................... 6.7
(c)....................................................................................... 2.12
317 (a)(1).................................................................................... 6.8
(a)(2).................................................................................... 6.9
(b)....................................................................................... 2.4
318 (a)....................................................................................... 12.1
(b)....................................................................................... N.A.
(c)....................................................................................... 12.1
-------------
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
111
Page
TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE...................................................1
Section 1.1. Definitions..................................................................1
Section 1.2. Other Definitions.......................................................... 18
Section 1.3. Incorporation By Reference of Trust
Indenture Act.......................................................... 19
Section 1.4. Rules of Construction...................................................... 19
ARTICLE 2
THE NOTES.................................................. 20
Section 2.1. Form and Dating............................................................ 20
Section 2.2. Execution and Authentication............................................... 21
Section 2.3. Registrar and Paying Agent................................................. 21
Section 2.4. Paying Agent to Hold Money in Trust........................................ 22
Section 2.5. Holder Lists............................................................... 22
Section 2.6. Transfer and Exchange...................................................... 22
Section 2.7. Replacement Notes.......................................................... 23
Section 2.8. Outstanding Notes.......................................................... 24
Section 2.9. Treasury Notes............................................................. 24
Section 2.10. CUSIP Number............................................................... 25
Section 2.11. Cancellation............................................................... 25
Section 2.12. Defaulted Interest......................................................... 25
Section 2.13. Book-Entry Provisions for Global Notes..................................... 25
ARTICLE 3
REDEMPTION AND PREPAYMENT.......................................... 27
Section 3.1. Notices to Trustee......................................................... 27
Section 3.2. Selection of Notes to Be Redeemed.......................................... 27
Section 3.3. Notice of Redemption....................................................... 28
Section 3.4. Effect of Notice of Redemption............................................. 29
Section 3.5. Deposit of Redemption Price................................................ 29
Section 3.6. Notes Redeemed in Part..................................................... 29
Section 3.7. Optional Redemption........................................................ 29
Section 3.8. Mandatory Redemption....................................................... 30
Section 3.9. Offer to Purchase By Application
of Excess Proceeds..................................................... 30
ARTICLE 4
COVENANTS.................................................. 33
Section 4.1. Payment of Notes........................................................... 33
Section 4.2. Maintenance of Office or Agency............................................ 33
Section 4.3. Reports.................................................................... 34
Section 4.4. Compliance Certificate..................................................... 34
Section 4.5. Taxes...................................................................... 35
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Section 4.6. Stay, Extension and Usury Laws............................................. 35
Section 4.7. Restricted Payments........................................................ 35
Section 4.8. Dividend and Other Payment Restrictions
Affecting Subsidiaries................................................. 38
Section 4.9. Incurrence of Indebtedness and
Issuance of Disqualified Stock......................................... 39
Section 4.10. Asset Sales................................................................ 41
Section 4.11. Transactions with Affiliates............................................... 42
Section 4.12. Liens...................................................................... 43
Section 4.13. Offer to Repurchase Upon Change
of Control............................................................. 44
Section 4.14. Additional Subsidiary Guarantees........................................... 45
Section 4.15. Corporate Existence........................................................ 45
Section 4.16. No Senior Subordinated Debt................................................ 46
Section 4.17. Business Activities........................................................ 46
ARTICLE 5
SUCCESSORS.................................................. 46
Section 5.1. Merger, Consolidation, or Sale of
Substantially All Assets............................................... 46
Section 5.2. Successor Corporation Substituted.......................................... 47
ARTICLE 6
DEFAULTS AND REMEDIES............................................ 48
Section 6.1. Events of Default.......................................................... 48
Section 6.2. Acceleration............................................................... 50
Section 6.3. Other Remedies............................................................. 51
Section 6.4. Waiver of Past Defaults.................................................... 51
Section 6.5. Control by Majority........................................................ 52
Section 6.6. Limitation on Suits........................................................ 52
Section 6.7. Rights of Holders of Notes to
Receive Payment........................................................ 52
Section 6.8. Collection Suit by Trustee................................................. 53
Section 6.9. Trustee May File Proofs of Claim........................................... 53
Section 6.10. Priorities................................................................. 54
Section 6.11. Undertaking for Costs...................................................... 54
ARTICLE 7
TRUSTEE................................................... 54
Section 7.1. Duties of Trustee.......................................................... 54
Section 7.2. Rights of Trustee.......................................................... 56
Section 7.3. Individual Rights of Trustee............................................... 57
Section 7.4. Trustee's Disclaimer....................................................... 57
Section 7.5. Notice of Defaults......................................................... 57
Section 7.6. Reports by Trustee to Holders of
the Notes.............................................................. 58
Section 7.7. Compensation and Indemnity................................................. 58
Section 7.8. Replacement of Trustee..................................................... 59
Section 7.9. Successor Trustee by Merger, etc. ......................................... 60
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Section 7.10. Eligibility; Disqualification.............................................. 60
Section 7.11. Preferential Collection of Claims
Against Company........................................................ 61
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE................................... 61
Section 8.1. Option to Effect Legal Defeasance
or Covenant Defeasance................................................. 61
Section 8.2. Legal Defeasance and Discharge............................................. 61
Section 8.3. Covenant Defeasance........................................................ 62
Section 8.4. Conditions to Legal or Covenant
Defeasance............................................................. 62
Section 8.5. Deposited Money and Government
Securities to be Held in Trust;
Other Miscellaneous Provisions......................................... 64
Section 8.6. Repayment to Company....................................................... 65
Section 8.7. Reinstatement.............................................................. 65
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER....................................... 65
Section 9.1. Without Consent of Holders of Notes........................................ 65
Section 9.2. With Consent of Holders of Notes........................................... 66
Section 9.3. Compliance with Trust Indenture Act........................................ 68
Section 9.4. Revocation and Effect of Consents.......................................... 68
Section 9.5. Notation on or Exchange of Notes........................................... 68
Section 9.6. Trustee to Sign Amendment, etc. ........................................... 69
ARTICLE 10
SUBORDINATION................................................ 69
Section 10.1. Agreement to Subordinate................................................... 69
Section 10.2. Certain Definitions........................................................ 69
Section 10.3. Liquidation; Dissolution; Bankruptcy....................................... 70
Section 10.4. Default on Designated Senior Debt.......................................... 73
Section 10.5. Acceleration of Notes...................................................... 74
Section 10.6. When Distribution Must Be Paid Over........................................ 74
Section 10.7. Notice by Company.......................................................... 74
Section 10.8. Subrogation................................................................ 75
Section 10.9. Relative Rights............................................................ 75
Section 10.10. Subordination May Not Be Impaired
by Company............................................................. 75
Section 10.11. Payment, Distribution or Notice
to Representative...................................................... 76
Section 10.12. Rights of Trustee and Paying Agent......................................... 76
Section 10.13. Authorization to Effect Subordination...................................... 76
Section 10.14. Amendments................................................................. 77
Section 10.15. No Waiver of Subordination Provisions...................................... 77
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ARTICLE 11
THE GUARANTEES................................................ 77
Section 11.1. The Guarantees............................................................. 77
Section 11.2. Execution and Delivery of Guarantees....................................... 78
Section 11.3. Subsidiary Guarantors May Consolidate,
etc., on Certain Terms................................................. 79
Section 11.4. Releases of Guarantees..................................................... 80
Section 11.5. Limitation on Subsidiary Guarantor
Liability.............................................................. 81
Section 11.6. "Trustee" to Include Paying Agent.......................................... 81
Section 11.7. Subordination of Guarantees................................................ 82
ARTICLE 12
MISCELLANEOUS................................................ 82
Section 12.1. Trust Indenture Act Controls............................................... 82
Section 12.2. Notices.................................................................... 82
Section 12.3. Communication by Holders of Notes with
Other Holders of Notes................................................. 83
Section 12.4. Certificate and Opinion as to
Conditions Precedent................................................... 83
Section 12.5. Statements Required in Certificate
or Opinion............................................................. 84
Section 12.6. Rules by Trustee and Agents................................................ 84
Section 12.7. No Personal Liability of Directors,
Officers, Employees and Stockholders................................... 85
Section 12.8. Governing Law.............................................................. 85
Section 12.9. No Adverse Interpretation of Other
Agreements............................................................. 85
Section 12.10. Successors................................................................. 85
Section 12.11. Severability............................................................... 85
Section 12.12. Counterpart Originals...................................................... 85
Section 12.13. Table of Contents, Headings, Etc. ......................................... 85
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF LEGEND FOR GLOBAL NOTE
Exhibit C FORM OF GUARANTEE
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