EXHIBIT 4.7
▇▇▇▇▇▇▇▇ RESOURCES, INC.,
GUARANTORS
NAMED HEREIN
and
THE BANK OF NEW YORK TRUST COMPANY, N.A.
Trustee
FIRST SUPPLEMENTAL INDENTURE
dated as of February 25, 2004
to
INDENTURE
dated as of February 25, 2004
6 7/8% Senior Notes due 2012
TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION............. 2
Section 1.1 Definitions................................................... 2
Section 1.2 Other Definitions............................................. 25
Section 1.3 Incorporation by Reference of Trust Indenture Act............. 26
Section 1.4 Rules of Construction......................................... 26
ARTICLE II. THE SECURITIES..................................................... 27
Section 2.1 Amount of Securities; Multiple Issuances...................... 27
Section 2.2 Form and Dating............................................... 28
Section 2.3 Execution and Authentication.................................. 28
Section 2.4 Registrar and Paying Agent.................................... 29
Section 2.5 Paying Agent To Hold Money in Trust........................... 29
Section 2.6 Holder Lists.................................................. 30
Section 2.7 Replacement Securities........................................ 30
Section 2.8 Outstanding Securities........................................ 30
Section 2.9 Temporary Securities.......................................... 30
Section 2.10 Cancellation.................................................. 31
Section 2.11 Defaulted Interest............................................ 31
Section 2.12 CUSIP Numbers................................................. 31
ARTICLE III. DEFAULTS AND REMEDIES............................................. 31
Section 3.1 Events of Default............................................. 31
Section 3.2 Acceleration of Maturity; Rescission and Annulment............ 33
Section 3.3 Collection of Indebtedness and Suits for Enforcement by
Trustee....................................................... 35
Section 3.4 Trustee May File Proofs of Claim.............................. 35
Section 3.5 Trustee May Enforce Claims Without Possession of Securities... 36
Section 3.6 Application of Money Collected................................ 36
Section 3.7 Limitation on Suits........................................... 37
Section 3.8 Unconditional Right of Holders to Receive Principal,
Premium and Interest.......................................... 38
Section 3.9 Restoration of Rights and Remedies............................ 38
Section 3.10 Rights and Remedies Cumulative................................ 38
Section 3.11 Delay or Omission Not Waiver.................................. 38
Section 3.12 Control by Holders............................................ 38
Section 3.13 Waiver of Past Defaults....................................... 39
Section 3.14 Waiver of Stay, Extension or Usury Laws....................... 39
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ARTICLE IV. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE............... 40
Section 4.1 Company May Consolidate, etc., Only on Certain Terms.......... 40
Section 4.2 Successor Substituted......................................... 41
ARTICLE V. SUPPLEMENTAL INDENTURES............................................. 42
Section 5.1 Supplemental Indentures Without Consent of Holders............ 42
Section 5.2 Supplemental Indentures with Consent of Holders............... 42
Section 5.3 Execution of Supplemental Indentures.......................... 43
Section 5.4 Effects of Supplemental Indentures............................ 44
Section 5.5 Conformity with Trust Indenture Act........................... 44
Section 5.6 References in Securities to Supplemental Indentures........... 44
Section 5.7 Notice of Supplemental Indentures............................. 44
ARTICLE VI. COVENANTS.......................................................... 44
Section 6.1 Payment of Principal, Premium, if any, and Interest........... 44
Section 6.2 Maintenance of Office or Agency............................... 44
Section 6.3 Corporate Existence........................................... 45
Section 6.4 Payment of Taxes; Maintenance of Properties; Insurance........ 45
Section 6.5 Statement by Officers as to Default........................... 46
Section 6.6 Provision of Financial Information............................ 47
Section 6.7 Limitation on Restricted Payments............................. 47
Section 6.8 Limitation on Guarantees by Restricted Subsidiaries........... 50
Section 6.9 Limitation on Indebtedness and Disqualified Capital Stock..... 51
Section 6.10 Additional Guarantors......................................... 52
Section 6.11 Limitation on Issuances and Sales of Preferred Stock of
Restricted Subsidiaries....................................... 52
Section 6.12 Limitation on Liens........................................... 52
Section 6.13 Purchase of Securities Upon Change of Control................. 52
Section 6.14 Limitation on Asset Sales..................................... 54
Section 6.15 Limitation on Transactions with Affiliates.................... 57
Section 6.16 Limitation on Dividends and Other Payment Restrictions
Affecting Restricted Subsidiaries............................. 58
Section 6.17 Limitation on Sale and Leaseback Transactions................. 58
Section 6.18 Covenant Suspension........................................... 59
ARTICLE VII. REDEMPTION OF SECURITIES.......................................... 59
Section 7.1 Notice to Trustee............................................. 59
Section 7.2 Selection by Trustee of Securities to Be Redeemed............. 59
Section 7.3 Notice of Redemption.......................................... 60
Section 7.4 Deposit of Redemption Price................................... 60
Section 7.5 Securities Payable on Redemption Date......................... 61
Section 7.6 Securities Redeemed in Part................................... 61
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ARTICLE VIII. DEFEASANCE AND COVENANT DEFEASANCE............................... 61
Section 8.1 Company's Option to Effect Defeasance or Covenant
Defeasance.................................................... 61
Section 8.2 Defeasance and Discharge...................................... 61
Section 8.3 Covenant Defeasance........................................... 62
Section 8.4 Conditions to Defeasance or Covenant Defeasance............... 62
Section 8.5 Deposited Money and U.S. Government Obligations to Be Held
in Trust; Other Miscellaneous Provisions...................... 64
Section 8.6 Reinstatement................................................. 65
ARTICLE IX. GUARANTEES......................................................... 65
Section 9.1 Unconditional Guarantee....................................... 65
Section 9.2 Guarantors May Consolidate, etc., on Certain Terms............ 66
Section 9.3 Release of Guarantors......................................... 67
Section 9.4 Limitation of Guarantors' Liability........................... 68
Section 9.5 Contribution.................................................. 68
Section 9.6 Severability.................................................. 68
ARTICLE X. MISCELLANEOUS....................................................... 68
Section 10.1 Acts of Holders............................................... 68
Section 10.2 Notices, etc. to Trustee, Company and Guarantors............. 70
Section 10.3 Notice to Holders; Waiver..................................... 70
Section 10.4 Effect of Headings and Table of Contents...................... 71
Section 10.5 Successors and Assigns........................................ 71
Section 10.6 Severability.................................................. 71
Section 10.7 Benefits of Indenture......................................... 71
Section 10.8 Governing Law; Trust Indenture Act Controls................... 71
Section 10.9 No Recourse Against Others.................................... 72
Section 10.10 Duplicate Originals........................................... 72
Section 10.11 Conflict with Base Indenture.................................. 72
Section 10.12 No Adverse Interpretation of Other Agreements................. 72
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Appendix A - Provisions Relating to Securities
Exhibit 1 to
Appendix A - Form of Security
iv
THIS FIRST SUPPLEMENTAL INDENTURE dated as of February 25, 2004 (as
originally executed and as it may from time to time be supplemented or amended
by one or more indentures supplemental hereto entered into pursuant to the
applicable provisions hereof, this "Supplemental Indenture"), is among ▇▇▇▇▇▇▇▇
RESOURCES, INC., a Nevada corporation (hereinafter called the "Company"), the
GUARANTORS (as defined hereinafter) and THE BANK OF NEW YORK TRUST COMPANY,
N.A., as Trustee (hereinafter called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Supplemental Indenture to provide for the issuance of its 6 7/8% Senior Notes
due 2012, to be issued from time to time as provided in this Supplemental
Indenture (the "Securities").
The Guarantors have duly authorized the execution and delivery of this
Supplemental Indenture to provide for the guarantee of the Securities by the
Guarantors as provided in this Supplemental Indenture.
This Supplemental Indenture constitutes a supplemental indenture in
respect of that certain Indenture dated as of even date herewith (the "Base
Indenture") by and among the Company, the Guarantors named therein and the
Trustee, the form of which Base Indenture was filed as an exhibit to the
Company's registration statement on Form S-3, filed on December 16, 2003, as
amended by Amendment No. 1 to Form S-3 filed on January 8, 2004, to the extent
related to the Securities, and this Supplemental Indenture supersedes the Base
Indenture to the extent inconsistent therewith.
All things necessary have been done to make the Securities, when executed
by the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company and to make this Supplemental
Indenture, when executed by the Company and each Guarantor named herein, a valid
agreement of the Company and each such Guarantor, in each case in accordance
with the terms of the Securities and this Supplemental Indenture, respectively.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Securities:
ARTICLE I.
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1 Definitions.
"Acquired Indebtedness" means Indebtedness of a Person (i) existing at the
time such Person becomes a Restricted Subsidiary or (ii) assumed in connection
with acquisitions of Properties from such Person (other than any Indebtedness
incurred in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary or such acquisition). Acquired Indebtedness shall be
deemed to be incurred on the date the acquired Person becomes a Restricted
Subsidiary or the date of the related acquisition of Properties from such
Person.
"Act" when used with respect to any Holder, has the meaning specified in
Section 10.1.
"Additional Assets" means (i) any Property (other than cash, Cash
Equivalents or securities) used in the Oil and Gas Business or any business
ancillary thereto, (ii) Investments in any other Person engaged in the Oil and
Gas Business or any business ancillary thereto (including the acquisition from
third parties of Capital Stock of such Person) as a result of which such other
Person becomes a Restricted Subsidiary, (iii) the acquisition from third parties
of Capital Stock of a Restricted Subsidiary or (iv) Investments pursuant to
clause (v) of the definition of "Permitted Investments."
"Adjusted Consolidated Net Tangible Assets" means (without duplication),
as of the date of determination, the remainder of:
(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 Commission guidelines before any state, Federal or foreign income taxes, as
estimated by the Company and confirmed by a nationally recognized firm of
independent petroleum engineers in a reserve report prepared as of the end of
the Company's most recently completed fiscal year for which audited financial
statements are available, 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 such year-end, which reserves were not reflected in 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 such year-end
due to exploration, development or exploitation activities, in each case
calculated in accordance with Commission guidelines (utilizing the prices
utilized in such year-end reserve report), 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 such year-end and (4)
estimated oil and gas reserves attributable to downward revisions of estimates
of proved oil and gas reserves since such year-end due to changes in geological
conditions or other factors which would, in accordance with standard industry
practice, cause such revisions, in each case calculated in accordance with
Commission guidelines (utilizing the prices utilized in such year-end reserve
report); provided that, in the case of each of the determinations made pursuant
to clauses (1) through (4), such increases and decreases shall be as estimated
by the Company's petroleum engineers, unless there is a Material Change as a
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result of such acquisitions, dispositions or revisions, in which event the
discounted future net revenues utilized for purposes of this clause (i)(a) shall
be confirmed in writing by a nationally recognized firm 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 a 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 and (2) the appraised
value, as estimated by independent appraisers, 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 audited financial statements,
minus
(ii) the sum of (a) minority interests, (b) any net gas balancing
liabilities of the Company and its Restricted Subsidiaries reflected in the
Company's latest audited financial statements, (c) to the extent included in
(i)(a) above, the discounted future net revenues, calculated in accordance with
Commission guidelines (utilizing the prices utilized in the Company's year-end
reserve report), attributable to reserves which are required to be delivered to
third parties to fully satisfy the obligations of the Company and its Restricted
Subsidiaries with respect to Volumetric Production Payments (determined, if
applicable, using the schedules specified with respect thereto) and (d) the
discounted future net revenues, calculated in accordance with Commission
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 (determined, if applicable, using the schedules specified
with respect thereto).
"Adjusted Net Assets" of a Guarantor at any date shall mean the amount by
which the fair value of the Properties of such Guarantor exceeds the total
amount of liabilities, including, without limitation, contingent liabilities
(after giving effect to all other fixed and contingent liabilities incurred or
assumed on such date), but excluding liabilities under its Guarantee, of such
Guarantor at such date.
"Affiliate" means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control," when used with respect to any Person, means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of this definition, beneficial ownership of 10% or more of the voting
common equity (on a fully diluted basis) or options or warrants to purchase such
equity (but only if exercisable at the date of determination or within 60 days
thereof) of a Person shall be deemed to constitute control of such Person.
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"Asset Sale" means any sale, issuance, conveyance, transfer, lease or
other disposition to any Person other than the Company or any of its Restricted
Subsidiaries (including, without limitation, by means of a merger or
consolidation) (collectively, for purposes of this definition, a "transfer"),
directly or indirectly, in one or a series of related transactions, of (i) any
Capital Stock of any Restricted Subsidiary held by the Company or any Restricted
Subsidiary, (ii) all or substantially all of the Properties of any division or
line of business of the Company or any of its Restricted Subsidiaries or (iii)
any other Properties of the Company or any of its Restricted Subsidiaries other
than (a) a transfer of cash, Cash Equivalents, hydrocarbons or other mineral
products in the ordinary course of business or (b) any lease, abandonment,
disposition, relinquishment or farm-out of any oil and gas Property in the
ordinary course of business. For the purposes of this definition, the term
"Asset Sale" also shall not include (A) any transfer of Properties (including
Capital Stock) that is governed by, and made in accordance with, the provisions
of Article IV hereof; (B) any transfer of Properties to an Unrestricted
Subsidiary, if permitted under Section 6.7 hereof; or (C) any transfer of
Properties (including Capital Stock) having a Fair Market Value of less than
$5,000,000.
"Attributable Indebtedness" means, with respect to any particular lease
under which any Person is at the time liable and at any date as of which the
amount thereof is to be determined, the present value of the total net amount of
rent required to be paid by such Person under the lease during the primary term
thereof, without giving effect to any renewals at the option of the lessee,
discounted from the respective due dates thereof to such date at the rate of
interest per annum implicit in the terms of the lease. As used in the preceding
sentence, the net amount of rent under any lease for any such period shall mean
the sum of rental and other payments required to be paid with respect to such
period by the lessee thereunder excluding any amounts required to be paid by
such lessee on account of maintenance and repairs, insurance, taxes,
assessments, water rates or similar charges. In the case of any lease which is
terminable by the lessee upon payment of a penalty, such net amount of rent
shall also include the amount of such penalty, but no rent shall be considered
as required to be paid under such lease subsequent to the first date upon which
it may be so terminated.
"Average Life" means, with respect to any Indebtedness, as at any date of
determination, the quotient obtained by dividing (i) the sum of the products of
(a) the number of years (and any portion thereof) from the date of determination
to the date or dates of each successive scheduled principal payment (including,
without limitation, any sinking fund or mandatory redemption payment
requirements) of such Indebtedness multiplied by (b) the amount of each such
principal payment by (ii) the sum of all such principal payments.
"Bank Credit Facility" means that certain Amended and Restated Credit
Agreement dated as of February 25, 2004 among ▇▇▇▇▇▇▇▇ Resources, Inc., as
Borrower, the lenders party thereto from time to time, Bank of Montreal, as
Administrative Agent and Issuing Bank, Bank of America, N.A., as Syndication
Agent, and Comerica Bank, Fortis Capital Corp. and Union Bank of California,
N.A., as Co-Documentation Agents, and together with all related documents
executed or delivered pursuant thereto at any time (including, without
limitation, all mortgages, deeds of trust, guarantees, security agreements and
all other collateral and security documents), in each case as such agreements
may be amended (including any amendment and restatement thereof), supplemented
or otherwise modified from time to time, including any agreement or
4
agreements extending the maturity of, refinancing, replacing or otherwise
restructuring (including into two or more separate credit facilities, and
including increasing the amount of available borrowings thereunder provided that
such increase in borrowings is within the definition of "Permitted Indebtedness"
or is otherwise permitted under Section 6.9) or adding Subsidiaries as
additional borrowers or guarantors thereunder and all or any portion of the
Indebtedness and other Obligations under such agreement or agreements or any
successor or replacement agreement or agreements, and whether by the same or any
other agent(s), lender(s) or group(s) of lenders.
"Base Indenture" has the meaning stated in the third recital of this
Supplemental Indenture.
"Borrowing Base" means, as of any date, the aggregate amount of borrowing
availability as of such date under the Bank Credit Facility that determines
availability on the basis of a borrowing base or other asset-based calculation.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in the cities of New York, New
York or Dallas, Texas are authorized or obligated by law or executive order to
close.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations, rights or other equivalents in the equity interests
(however designated) in such Person, and any rights (other than debt securities
convertible into an equity interest), warrants or options exercisable for,
exchangeable for or convertible into such an equity interest in such Person.
"Capitalized Lease Obligation" means any obligation to pay rent or other
amounts under a lease of (or other agreement conveying the right to use) any
Property that is required to be classified and accounted for as a capital lease
obligation under GAAP, and, for the purpose of this Supplemental Indenture, the
amount of such obligation at any date shall be the capitalized amount thereof at
such date, determined in accordance with GAAP.
"Cash Equivalents" means (i) any evidence of Indebtedness with a maturity
of 180 days or less issued or directly and fully guaranteed or insured by the
United States of America or any agency or instrumentality thereof (provided that
the full faith and credit of the United States of America is pledged in support
thereof); (ii) demand and time deposits and certificates of deposit or
acceptances with a maturity of 180 days or less of any financial institution
that is a member of the Federal Reserve System having combined capital and
surplus and undivided profits of not less than $500,000,000; (iii) commercial
paper with a maturity of 180 days or less issued by a corporation that is not an
Affiliate of the Company and is organized under the laws of any state of the
United States or the District of Columbia and rated at least A-l by S&P or at
least P-l by Moody's; (iv) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clause (i) above
entered into with any commercial bank meeting the specifications of clause (ii)
above; (v) overnight bank deposits and bankers' acceptances at any commercial
bank meeting the qualifications specified in clause (ii) above; (vi) deposits
available for withdrawal on demand with any commercial bank not meeting the
5
qualifications specified in clause (ii) above but which is a lending bank under
the Bank Credit Facility, provided all such deposits do not exceed $5,000,000 in
the aggregate at any one time; (vii) demand and time deposits and certificates
of deposit with any commercial bank organized in the United States not meeting
the qualifications specified in clause (ii) above, provided that such deposits
and certificates support bond, letter of credit and other similar types of
obligations incurred in the ordinary course of business; and (viii) investments
in money market or other mutual funds substantially all of whose assets comprise
securities of the types described in clauses (i) through (v) above.
"Change of Control" means the occurrence of any event or series of events
by which (i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act), is or becomes the "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of more than 50%
of the total Voting Stock of the Company; (ii) the Company consolidates with or
merges into another Person or any Person consolidates with, or merges into, the
Company, in any such event pursuant to a transaction in which the outstanding
Voting Stock of the Company is changed into or exchanged for cash, securities or
other Property, other than any such transaction where (a) the outstanding Voting
Stock of the Company is changed into or exchanged for Voting Stock of the
surviving or resulting Person that is Qualified Capital Stock and (b) the
holders of the Voting Stock of the Company immediately prior to such transaction
own, directly or indirectly, not less than a majority of the Voting Stock of the
surviving or resulting Person immediately after such transaction; (iii) the
Company, either individually or in conjunction with one or more Restricted
Subsidiaries, sells, assigns, conveys, transfers, leases or otherwise disposes
of, or the Restricted Subsidiaries sell, assign, convey, transfer, lease or
otherwise dispose of, all or substantially all of the Properties of the Company
and such Restricted Subsidiaries, taken as a whole (either in one transaction or
a series of related transactions), including Capital Stock of the Restricted
Subsidiaries, to any Person (other than the Company or a Wholly Owned Restricted
Subsidiary); (iv) during any consecutive two-year period, individuals who at the
beginning of such period constituted the Board of Directors of the Company
(together with any new directors whose election by such Board of Directors or
whose nomination for election by the stockholders of the Company was approved by
a vote of 66 2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office; or (v) the
liquidation or dissolution of the Company.
"Change of Control Triggering Event" means the occurrence of a Change of
Control followed within 30 days by a downgrade in the ratings of the Securities
by either S&P or Moody's.
"Commission" or "SEC" means the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this Supplemental Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Stock" of any Person means Capital Stock of such Person that does
not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or
6
involuntary liquidation, dissolution or winding-up of such Person, to shares of
Capital Stock of any other class of such Person.
"Consolidated Exploration Expenses" means, for any period, exploration
expenses of the Company and its Restricted Subsidiaries for such period as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means, for any period, the
ratio on a pro forma basis of (i) the sum of Consolidated Net Income,
Consolidated Interest Expense, Consolidated Income Tax Expense and Consolidated
Non-cash Charges each to the extent deducted in computing Consolidated Net
Income, in each case, for such period, of the Company and its Restricted
Subsidiaries on a consolidated basis, all determined in accordance with GAAP,
decreased (to the extent included in determining Consolidated Net Income) by the
sum of (x) the amount of deferred revenues that are amortized during such period
and are attributable to reserves that are subject to Volumetric Production
Payments and (y) amounts recorded in accordance with GAAP as repayments of
principal and interest pursuant to Dollar-Denominated Production Payments, to
(ii) the sum of such Consolidated Interest Expense for such period; provided,
however, that (a) the Consolidated Fixed Charge Coverage Ratio shall be
calculated on a pro forma basis on the assumptions that (A) the Indebtedness to
be incurred (and all other Indebtedness incurred after the first day of such
period of four full fiscal quarters referred to in Section 6.9(a) hereof through
and including the date of determination), and (if applicable) the application of
the net proceeds therefrom (and from any other such Indebtedness), including to
refinance other Indebtedness, had been incurred on the first day of such
four-quarter period and, in the case of Acquired Indebtedness, on the assumption
that the related transaction (whether by means of purchase, merger or otherwise)
also had occurred on such date with the appropriate adjustments with respect to
such acquisition being included in such pro forma calculation and (B) any
acquisition or disposition by the Company or any Restricted Subsidiary of any
Properties outside the ordinary course of business, or any repayment of any
principal amount of any Indebtedness of the Company or any Restricted Subsidiary
prior to the Stated Maturity thereof, in either case since the first day of such
period of four full fiscal quarters through and including the date of
determination, had been consummated on such first day of such four-quarter
period, (b) in making such computation, the Consolidated Interest Expense
attributable to interest on any Indebtedness required to be computed on a pro
forma basis in accordance with Section 6.9(a) hereof and (A) bearing a floating
interest rate shall be computed as if the rate in effect on the date of
computation had been the applicable rate for the entire period and (B) which was
not outstanding during the period for which the computation is being made but
which bears, at the option of the Company, a fixed or floating rate of interest,
shall be computed by applying, at the option of the Company, either the fixed or
floating rate, (c) in making such computation, the Consolidated Interest Expense
attributable to interest on any Indebtedness under a revolving credit facility
required to be computed on a pro forma basis in accordance with Section 6.9(a)
hereof shall be computed based upon the average daily balance of such
Indebtedness during the applicable period, provided that such average daily
balance shall be reduced by the amount of any repayment of Indebtedness under a
revolving credit facility during the applicable period, which repayment
permanently reduced the commitments or amounts available to be reborrowed under
such facility, (d) notwithstanding clauses (b) and (c) of this provision,
interest on Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by
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agreements relating to Interest Rate Protection Obligations, shall be deemed to
have accrued at the rate per annum resulting after giving effect to the
operation of such agreements, (e) in making such calculation, Consolidated
Interest Expense shall exclude interest attributable to Dollar-Denominated
Production Payments, and (f) if after the first day of the period referred to in
clause (i) of this definition the Company has permanently retired any
Indebtedness out of the Net Cash Proceeds of the issuance and sale of shares of
Qualified Capital Stock of the Company within 30 days of such issuance and sale,
Consolidated Interest Expense shall be calculated on a pro forma basis as if
such Indebtedness had been retired on the first day of such period.
"Consolidated Income Tax Expense" means, for any period, the provision for
federal, state, local and foreign income taxes (including state franchise taxes
accounted for as income taxes in accordance with GAAP) of the Company and its
Restricted Subsidiaries for such period as determined on a consolidated basis in
accordance with GAAP.
"Consolidated Interest Expense" means, for any period, without
duplication, the sum of (i) the interest expense of the Company and its
Restricted Subsidiaries for such period as determined on a consolidated basis in
accordance with GAAP, including, without limitation, (a) any amortization of
debt discount, (b) the net cost under Interest Rate Protection Obligations
(including any amortization of discounts), (c) the interest portion of any
deferred payment obligation constituting Indebtedness, (d) all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing and (e) all accrued interest, in each case to the
extent attributable to such period, (ii) to the extent any Indebtedness of any
Person (other than the Company or a Restricted Subsidiary) is guaranteed by the
Company or any Restricted Subsidiary, the aggregate amount of interest paid (to
the extent not accrued in a prior period) or accrued by such other Person during
such period attributable to any such Indebtedness, in each case to the extent
attributable to that period, (iii) the aggregate amount of the interest
component of Capitalized Lease Obligations paid (to the extent not accrued in a
prior period), accrued or scheduled to be paid or accrued by the Company and its
Restricted Subsidiaries during such period as determined on a consolidated basis
in accordance with GAAP and (iv) the aggregate amount of dividends paid (to the
extent such dividends are not accrued in a prior period and excluding dividends
paid in Qualified Capital Stock) or accrued on Disqualified Capital Stock of the
Company and its Restricted Subsidiaries, to the extent such Disqualified Capital
Stock is owned by Persons other than the Company or its Restricted Subsidiaries,
less, to the extent included in any of clauses (i) through (iv), amortization of
capitalized debt issuance costs of the Company and its Restricted Subsidiaries
during such period.
"Consolidated Net Income" means, for any period, the consolidated net
income (or loss) of the Company and its Restricted Subsidiaries for such period
as determined in accordance with GAAP, adjusted by excluding (i) net after-tax
extraordinary gains or losses (less all fees and expenses relating thereto),
(ii) net after-tax gains or losses (less all fees and expenses relating thereto)
attributable to Asset Sales, (iii) the net income (or net loss) of any Person
(other than the Company or any of its Restricted Subsidiaries), in which the
Company or any of its Restricted Subsidiaries has an ownership interest, except
to the extent of the amount of dividends or other distributions actually paid to
the Company or any of its Restricted Subsidiaries in cash by such other Person
during such period (regardless of whether such cash dividends or distributions
is
8
attributable to net income (or net loss) of such Person during such period or
during any prior period), (iv) net income (or net loss) of any Person combined
with the Company or any of its Restricted Subsidiaries on a "pooling of
interests" basis attributable to any period prior to the date of combination,
(v) the net income of any Restricted Subsidiary to the extent that the
declaration or payment of dividends or similar distributions by that Restricted
Subsidiary is not at the date of determination permitted, 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, (vi) dividends
paid in Qualified Capital Stock, (vii) income resulting from transfers of assets
received by the Company or any Restricted Subsidiary from an Unrestricted
Subsidiary, (viii) Consolidated Exploration Expenses and any write-downs or
impairments of non-current assets, (ix) to the extent deducted in the
calculation of net income, any charges associated with the extinguishment of the
Indebtedness evidenced by the Company's 11 1/4% Senior Notes due 2007 and (x)
the cumulative effect of a change in accounting principles.
"Consolidated Net Worth" means, at any date, the consolidated
stockholders' equity of the Company and its Restricted Subsidiaries less the
amount of such stockholders' equity attributable to Disqualified Capital Stock
or treasury stock of the Company and its Restricted Subsidiaries, as determined
in accordance with GAAP.
"Consolidated Non-cash Charges" means, for any period, the aggregate
depreciation, depletion, amortization and exploration expense and other non-cash
expenses of the Company and its Restricted Subsidiaries reducing Consolidated
Net Income for such period, determined on a consolidated basis in accordance
with GAAP (excluding any such non-cash charge for which an accrual of or reserve
for cash charges for any future period is required).
"Consolidated Total Indebtedness" means, with respect to the Company and
its Restricted Subsidiaries as of any date of determination, the aggregate of
all Indebtedness of the Company and its Restricted Subsidiaries as of such date
of determination, on a consolidated basis, determined in accordance with GAAP.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time the trust created by this Supplemental Indenture is
administered, which office at the date of execution of this Supplemental
Indenture is located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
"Default" means any event, act or condition that is, or after notice or
passage of time or both would become, an Event of Default.
"Disinterested Director" means, with respect to any transaction or series
of transactions in respect of which the Board of Directors of the Company is
required to deliver a Board Resolution hereunder, a member of the Board of
Directors of the Company who does not have any material direct or indirect
financial interest (other than an interest arising solely from the beneficial
ownership of Capital Stock of the Company) in or with respect to such
transaction or series of transactions.
9
"Disqualified Capital Stock" means any Capital Stock that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or by contract or otherwise, is, or upon the happening of an event or passage of
time would be, required to be redeemed or repurchased prior to the final Stated
Maturity of the Securities or is redeemable at the option of the holder thereof
at any time prior to such final Stated Maturity, or is convertible into or
exchangeable for debt securities at any time prior to such final Stated
Maturity. For purposes of Section 6.9(a) hereof, Disqualified Capital Stock
shall be valued at the greater of its voluntary or involuntary maximum fixed
redemption or repurchase price plus accrued and unpaid dividends. For such
purposes, the "maximum fixed redemption or repurchase price" of any Disqualified
Capital Stock which does not have a fixed redemption or repurchase price shall
be calculated in accordance with the terms of such Disqualified Capital Stock as
if such Disqualified Capital Stock were redeemed or repurchased on the date of
determination, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined in good faith by the board of directors of the issuer of such
Disqualified Capital Stock; provided, however, that if such Disqualified Capital
Stock is not at the date of determination permitted or required to be redeemed
or repurchased, the "maximum fixed redemption or repurchase price" shall be the
book value of such Disqualified Capital Stock.
"Dollar-Denominated Production Payments" means production payment
obligations of the Company or any Restricted Subsidiary recorded as liabilities
in accordance with GAAP, together with all undertakings and obligations in
connection therewith.
"Event of Default" has the meaning specified in Section 3.1 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, and any successor act thereto.
"Exchanged Properties" means properties or assets used or useful in the
Oil and Gas Business received by the Company or a Restricted Subsidiary in trade
or as a portion of the total consideration for other such properties or assets.
"Fair Market Value" means the fair market value of a Property (including
shares of Capital Stock) as determined in good faith by the Board of Directors
of the Company and evidenced by a Board Resolution, which determination shall be
conclusive for purposes of this Supplemental Indenture; provided, however, that
unless otherwise specified herein, the Board of Directors shall be under no
obligation to obtain any valuation or assessment from any investment banker,
appraiser or other third party.
"Federal Bankruptcy Code" means the United States Bankruptcy Code of Title
11 of the United States Code, as amended from time to time.
The uncapitalized term "guarantee" means, as applied to any obligation,
(i) a guarantee (other than by endorsement of negotiable instruments or
documents for collection in the ordinary course of business), direct or
indirect, in any manner, of any part or all of such obligation and (ii) an
agreement, direct or indirect, contingent or otherwise, the practical effect of
which is to assure in any way the payment or performance (or payment of damages
in the event of non-
10
performance) of all or any part of such obligation, including, without limiting
the foregoing, the payment of amounts drawn down under letters of credit. When
used as a verb, "guarantee" has a corresponding meaning.
"Guarantee" has the meaning specified in Section 9.1 hereof.
"Guarantor" means (i) ▇▇▇▇▇▇▇▇ Oil & Gas, Inc., (ii) ▇▇▇▇▇▇▇▇ Oil & Gas -
Louisiana, LLC, (iii) ▇▇▇▇▇▇▇▇ Offshore, LLC, (iv) ▇▇▇▇▇▇▇▇ Oil & Gas Holdings,
Inc., (v) each of the Company's other Restricted Subsidiaries, if any, executing
a supplemental indenture in compliance with the provisions of Section 6.10(a)
hereof and (vi) any Person that becomes a successor guarantor of the Securities
in compliance with the provisions of Section 9.2 hereof.
"Indebtedness" means, with respect to any Person, without duplication, (i)
all liabilities of such Person, contingent or otherwise, for borrowed money or
for the deferred purchase price of Property or services (excluding any trade
accounts payable and other accrued current liabilities incurred and reserves
established in the ordinary course of business) and all liabilities of such
Person incurred in connection with any agreement to purchase, redeem, exchange,
convert or otherwise acquire for value any Capital Stock of such Person, or any
warrants, rights or options to acquire such Capital Stock outstanding on the
date of this Supplemental Indenture or thereafter, if, and to the extent, any of
the foregoing would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP, (ii) all obligations of such Person evidenced
by bonds, notes, debentures or other similar instruments, if, and to the extent,
any of the foregoing would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, (iii) all obligations of such Person
with respect to letters of credit, (iv) all indebtedness of such Person created
or arising under any conditional sale or other title retention agreement with
respect to Property acquired by such Person (even if the rights and remedies of
the seller or lender under such agreement in the event of default are limited to
repossession or sale of such Property), but excluding trade accounts payable
arising and reserves established in the ordinary course of business, (v) all
Capitalized Lease Obligations of such Person, (vi) the Attributable Indebtedness
(in excess of any related Capitalized Lease Obligations) related to any
Sale/Leaseback Transaction of such Person, (vii) all Indebtedness referred to in
the preceding clauses of other Persons and all dividends of other Persons, the
payment of which is secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien upon
Property (including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness (the amount of such obligation being deemed to be
the lesser of the value of such Property or the amount of the obligation so
secured), (viii) all guarantees by such Person of Indebtedness referred to in
this definition (including, with respect to any Production Payment, any
warranties or guaranties of production or payment by such Person with respect to
such Production Payment but excluding other contractual obligations of such
Person with respect to such Production Payment), and (ix) all obligations of
such Person under or in respect of currency exchange contracts, oil and natural
gas price hedging arrangements and Interest Rate Protection Obligations. Subject
to clause (viii) of the first sentence of this definition, neither
Dollar-Denominated Production Payments nor Volumetric Production Payments shall
be deemed to be Indebtedness. In addition, Disqualified Capital Stock shall not
be deemed to be Indebtedness.
11
"Indenture" means the Base Indenture as supplemented by this Supplemental
Indenture and as the Base Indenture may from time to time be further
supplemented or amended by one or more indentures supplemental thereto entered
into pursuant to the applicable provisions thereof.
"Insolvency or Liquidation Proceeding" means, with respect to any Person,
(a) an insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or similar case or proceeding in connection
therewith, relative to such Person or its creditors, as such, or its assets or
(b) any liquidation, dissolution or other winding-up proceeding of such Person,
whether voluntary or involuntary and whether or not involving insolvency or
bankruptcy or (c) any assignment for the benefit of creditors or any other
marshaling of assets and liabilities of such Person.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.
"Interest Rate Protection Obligations" means the obligations of any Person
pursuant to any arrangement with any other Person whereby, directly or
indirectly, such Person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest on
a stated notional amount in exchange for periodic payments made by such Person
calculated by applying a fixed or a floating rate of interest on the same
notional amount and shall include, without limitation, interest rate swaps,
caps, floors, collars and similar agreements or arrangements designed to protect
against or manage such Person's and any of its Subsidiaries' exposure to
fluctuations in interest rates.
"Investment" means, with respect to any Person, any direct or indirect
advance, loan, guarantee of Indebtedness or other extension of credit or capital
contribution to (by means of any transfer of cash or other Property to others or
any payment for Property or services for the account or use of others), or any
purchase or acquisition by such Person of any Capital Stock, bonds, notes,
debentures or other securities (including derivatives) or evidences of
Indebtedness issued by, any other Person. In addition, the Fair Market Value of
the net assets of any Restricted Subsidiary at the time that such Restricted
Subsidiary is designated an Unrestricted Subsidiary shall be deemed to be an
"Investment" made by the Company in such Unrestricted Subsidiary at such time.
"Investments" shall exclude (i) extensions of trade credit or other advances to
customers on commercially reasonable terms in accordance with normal trade
practices or otherwise in the ordinary course of business, (ii) Interest Rate
Protection Obligations entered into in the ordinary course of business or as
required by any Permitted Indebtedness or any Indebtedness incurred in
compliance with Section 6.9 hereof, but only to the extent that the stated
aggregate notional amounts of such Interest Rate Protection Obligations do not
exceed 105% of the aggregate principal amount of such Indebtedness to which such
Interest Rate Protection Obligations relate and (iii) endorsements of negotiable
instruments and documents in the ordinary course of business.
"Issue Date" means the date on which the Original Securities were first
issued under this Supplemental Indenture.
12
"Leverage Ratio" means with respect to the Company and its Restricted
Subsidiaries for any period, the ratio of (i) the Consolidated Total
Indebtedness of the Company and its Restricted Subsidiaries as of the last day
of such period to (ii) the sum of Consolidated Net Income, Consolidated Interest
Expense, Consolidated Income Tax Expense and Consolidated Non-cash Charges each
to the extent deducted in computing Consolidated Net Income, in each case, for
such period, of the Company and its Restricted Subsidiaries on a consolidated
basis, all determined in accordance with GAAP, decreased (to the extent included
in determining Consolidated Net Income) by the sum of (a) the amount of deferred
revenues that are amortized during such period and are attributable to reserves
that are subject to Volumetric Production Payments and (b) amounts recorded in
accordance with GAAP as repayments of principal and interest pursuant to
Dollar-Denominated Production Payments. Calculation of the Leverage Ratio on a
pro forma basis shall be made in the manner specified in the definition of
"Consolidated Fixed Charge Coverage Ratio" with respect to pro forma
calculations of the Consolidated Fixed Charge Coverage Ratio.
"Lien" means any mortgage, charge, pledge, lien (statutory or other),
security interest, hypothecation, assignment for security, claim or similar type
of encumbrance (including, without limitation, any agreement to give or grant
any lease, conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing) upon or with
respect to any Property of any kind. A Person shall be deemed to own subject to
a Lien any Property which such Person has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement.
"Liquid Securities" means securities (i) of an issuer that is not an
Affiliate of the Company, (ii) that are publicly traded on the New York Stock
Exchange, the American Stock Exchange or the Nasdaq National Market and (iii) as
to which the Company is not subject to any restrictions on sale or transfer
(including any volume restrictions under Rule 144 under the Securities Act or
any other restrictions imposed by the Securities Act) or as to which a
registration statement under the Securities Act covering the resale thereof is
in effect for as long as the securities are held; provided that securities
meeting the requirements of clauses (i), (ii) and (iii) above shall be treated
as Liquid Securities from the date of receipt thereof until and only until the
earlier of (a) the date on which such securities are sold or exchanged for cash
or Cash Equivalents and (b) 150 days following the date of receipt of such
securities. If such securities are not sold or exchanged for cash or Cash
Equivalents within 120 days of receipt thereof, for purposes of determining
whether the transaction pursuant to which the Company or a Restricted Subsidiary
received the securities was in compliance with Section 6.14 hereof, such
securities shall be deemed not to have been Liquid Securities at any time.
"Material Change" means an increase or decrease (except to the extent
resulting from changes in prices) of more than 30% during a fiscal quarter in
the estimated discounted future net revenues 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
with respect to which the Company's estimate of the discounted future net
revenues from proved oil and gas
13
reserves has been confirmed by independent petroleum engineers and (ii) any
dispositions of Properties during such quarter that were disposed of in
compliance with Section 6.14.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors.
"Net Available Cash" from an Asset Sale or Sale/Leaseback Transaction
means cash proceeds received therefrom (including (i) any cash proceeds received
by way of deferred payment of principal pursuant to a note or installment
receivable or otherwise, but only as and when received and (ii) the Fair Market
Value of Liquid Securities and Cash Equivalents, and excluding (a) any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to the Property that is the subject
of such Asset Sale or Sale/Leaseback Transaction and (b) except to the extent
subsequently converted to cash, Cash Equivalents or Liquid Securities within 240
days after such Asset Sale or Sale/Leaseback Transaction, consideration
constituting Exchanged Properties or consideration other than as identified in
the immediately preceding clauses (i) and (ii)), in each case net of (a) all
legal, title and recording expenses, commissions and other fees and expenses
incurred, and all federal, state, foreign and local taxes required to be paid or
accrued as a liability under GAAP as a consequence of such Asset Sale or
Sale/Leaseback Transaction, (b) all payments made on any Indebtedness (but
specifically excluding Indebtedness of the Company and its Restricted
Subsidiaries assumed in connection with or in anticipation of such Asset Sale or
Sale/Leaseback Transaction) which is secured by any assets subject to such Asset
Sale or Sale/Leaseback Transaction, in accordance with the terms of any Lien
upon such assets, or which must by its terms, or in order to obtain a necessary
consent to such Asset Sale or Sale/Leaseback Transaction or by applicable law,
be repaid out of the proceeds from such Asset Sale or Sale/Leaseback
Transaction, provided that such payments are made in a manner that results in
the permanent reduction in the balance of such Indebtedness and, if applicable,
a permanent reduction in any outstanding commitment for future incurrences of
Indebtedness thereunder, (c) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or joint ventures as a result
of such Asset Sale or Sale/Leaseback Transaction and (d) the deduction of
appropriate amounts to be provided by the seller as a reserve, in accordance
with GAAP, against any liabilities associated with the assets disposed of in
such Asset Sale or Sale/Leaseback Transaction and retained by the Company or any
Restricted Subsidiary after such Asset Sale or Sale/Leaseback Transaction;
provided, however, that if any consideration for an Asset Sale or Sale/Leaseback
Transaction (which would otherwise constitute Net Available Cash) is required to
be held in escrow pending determination of whether a purchase price adjustment
will be made, such consideration (or any portion thereof) shall become Net
Available Cash only at such time as it is released to such Person or its
Restricted Subsidiaries from escrow.
"Net Cash Proceeds" with respect to any issuance or sale of Qualified
Capital Stock or other securities, means the cash proceeds of such issuance or
sale net of attorneys' fees, accountants' fees, underwriters' or placement
agents' fees, discounts or commissions and brokerage, consultant and other fees
and expenses actually incurred in connection with such issuance or sale and net
of taxes paid or payable as a result thereof.
"Net Working Capital" means (i) all current assets of the Company and its
Restricted Subsidiaries, less (ii) all current liabilities of the Company and
its Restricted Subsidiaries, except
14
current liabilities included in Indebtedness, in each case as set forth in
consolidated financial statements of the Company prepared in accordance with
GAAP.
"Non-Recourse Indebtedness" means Indebtedness or that portion of
Indebtedness of the Company or any Restricted Subsidiary incurred in connection
with the acquisition by the Company or such Restricted Subsidiary of any
Property and as to which (i) the holders of such Indebtedness agree that they
will look solely to the Property so acquired and securing such Indebtedness for
payment on or in respect of such Indebtedness, and neither the Company nor any
Subsidiary (other than an Unrestricted Subsidiary) (a) provides credit support,
including any undertaking, agreement or instrument which would constitute
Indebtedness or (b) is directly or indirectly liable for such Indebtedness, and
(ii) no default with respect to such Indebtedness would permit (after notice or
passage of time or both), according to the terms thereof, any holder of any
Indebtedness of the Company or a Restricted Subsidiary to declare a default on
such Indebtedness or cause the payment thereof to be accelerated or payable
prior to its Stated Maturity.
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, payments with respect to any letters of
credit, reimbursements, damages and other liabilities payable under the
documentation governing any Indebtedness.
"Officers" means, with respect to any Person, the Chief Executive Officer,
the President, any Vice President, the Chief Financial Officer and the Treasurer
of such Person.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company, and delivered
to the Trustee.
"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, treating, processing,
storage, refining, selling and transporting of any production from such
interests or Properties, (iii) any business relating to or arising from
exploration for or development, production, treatment, processing, storage,
refining, transportation or marketing of oil, gas and other minerals and
products produced in association therewith and (iv) any activity necessary,
appropriate or incidental to the activities described in the foregoing clauses
(i) through (iii) of this definition.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company (or any Guarantor), including an employee of the Company
(or any Guarantor), and who shall be reasonably acceptable to the Trustee.
"Outstanding," when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Supplemental Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
15
(ii) Securities, or portions thereof, for whose payment or
redemption money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Company) in trust or
set aside and segregated in trust by the Company (if the Company shall act
as its own Paying Agent) for the Holders of such Securities, provided
that, if such Securities are to be redeemed, notice of such redemption has
been duly given pursuant to this Supplemental Indenture or provision
therefor satisfactory to the Trustee has been made;
(iii) Securities, except to the extent provided in Sections 8.2 and
8.3 hereof, with respect to which the Company has effected legal
defeasance or covenant defeasance as provided in Article VIII hereof; and
(iv) Securities which have been paid pursuant to Section 2.7 hereof
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Supplemental Indenture, other
than any such Securities in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such securities are
held by a bona fide purchaser in whose hands the Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, consent, notice or waiver hereunder, and for the
purpose of making the calculations required by TIA Section 313, Securities owned
by the Company, any Guarantor or any other obligor upon the Securities or any
Affiliate of the Company, any Guarantor or such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction, consent, notice or
waiver, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company, any Guarantor or any other obligor upon the
Securities or any Affiliate of the Company, any Guarantor or such other obligor.
"Permitted Indebtedness" means any of the following:
(i) Priority Credit Facility Debt in an aggregate amount at any one
time outstanding not to exceed the greater of (a) the Borrowing Base under
the Bank Credit Facility at such time less the sum of all repayments of
principal of Priority Credit Facility Debt made pursuant to Section 6.14
hereof and (b) 25% of Adjusted Consolidated Net Tangible Assets; provided,
however, that Indebtedness and Disqualified Capital Stock of Restricted
Subsidiaries that are not Guarantors shall not at any time constitute more
than 50% of all Priority Credit Facility Debt otherwise permitted under
this clause (i);
(ii) Indebtedness under the Original Securities;
16
(iii) Indebtedness outstanding or in effect on the date of this
Supplemental Indenture (and not repaid or defeased with the proceeds of
the offering of the Securities);
(iv) obligations pursuant to Interest Rate Protection Obligations,
but only to the extent such obligations do not exceed 105% of the
aggregate principal amount of the Indebtedness covered by such Interest
Rate Protection Obligations; obligations under currency exchange contracts
entered into in the ordinary course of business; hedging arrangements
entered into in the ordinary course of business for the purpose of
protecting production, purchases and resales against fluctuations in oil
or natural gas prices; and any guarantee of any of the foregoing;
(v) the Guarantees of the Securities (and any assumption of the
obligations guaranteed thereby);
(vi) Indebtedness of the Company owing to and held by a Wholly Owned
Restricted Subsidiary, and Indebtedness of any Restricted Subsidiary owing
to and held by the Company or a Wholly Owned Restricted Subsidiary;
(vii) Permitted Refinancing Indebtedness and any guarantee thereof;
(viii) Non-Recourse Indebtedness;
(ix) in-kind obligations relating to net oil or gas balancing
positions arising in the ordinary course of business;
(x) Indebtedness in respect of bid, performance or surety bonds
issued for the account of the Company or any Restricted Subsidiary in the
ordinary course of business, including guaranties and letters of credit
supporting such bid, performance or surety obligations (in each case other
than for an obligation for money borrowed); and
(xi) any additional Indebtedness in an aggregate principal amount
not in excess of $50,000,000 at any one time outstanding and any guarantee
thereof.
"Permitted Investments" means any of the following:
(i) Investments in Cash Equivalents;
(ii) Investments in property, plant and equipment used in the
ordinary course of business;
(iii) Investments in the Company or any of its Restricted
Subsidiaries;
(iv) Investments by the Company or any of its Restricted
Subsidiaries in another Person, if as a result of such Investment (a) such
other Person becomes a Restricted Subsidiary or (b) such other Person is
merged or consolidated with or into, or
17
transfers or conveys all or substantially all of its Properties to, the
Company or a Restricted Subsidiary;
(v) 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 or other similar
or customary agreements, transactions, Properties, interests 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;
(vi) entry into any hedging arrangements in the ordinary course of
business for the purpose of protecting the Company's or any Restricted
Subsidiary's production, purchases and resales against fluctuations in oil
or natural gas prices;
(vii) entry into any currency exchange contract in the ordinary
course of business;
(viii) Investments in stock, obligations or securities received in
settlement of debts owing to the Company or any Restricted Subsidiary as a
result of bankruptcy or insolvency proceedings or upon the foreclosure,
perfection or enforcement of any Lien in favor of the Company or any
Restricted Subsidiary, in each case as to debt owing to the Company or any
Restricted Subsidiary that arose in the ordinary course of business of the
Company or any such Restricted Subsidiary;
(ix) any Investment by the Company or any of its Restricted
Subsidiaries in any Person that was previously a Subsidiary of the Company
but ceases to be such as a result of a reduction in the Company's direct
or indirect ownership interest in such Person; provided, that at the time
such Person ceases to be a Subsidiary of the Company and immediately after
giving effect thereto, (a) no other "person" or "group" (as such terms are
used in Sections 13(d) and 14(d) of the Exchange Act) shall be or become
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of a percentage of the total Voting Stock of such
Person greater than the percentage of the total Voting Stock of such
Person owned by the Company at such time and (b) the Leverage Ratio on a
pro forma basis with respect to the period of four full fiscal quarters
then most recently ended does not exceed 1.75 to 1.0; or
(x) other Investments, in an aggregate amount not to exceed at any
one time outstanding the greater of (a) $20,000,000 and (b) 5% of Adjusted
Consolidated Net Tangible Assets.
18
"Permitted Liens" means the following types of Liens:
(i) Liens securing Indebtedness of the Company or any Restricted
Subsidiary that constitutes Priority Credit Facility Debt permitted
pursuant to clause (i) of the definition of "Permitted Indebtedness";
(ii) Liens existing as of the date of this Supplemental Indenture
(excluding Liens securing Indebtedness of the Company under the Bank
Credit Facility);
(iii) Liens securing the Securities or the Guarantees;
(iv) Liens in favor of the Company or any Restricted Subsidiary;
(v) Liens for taxes, assessments and governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Company or its Restricted Subsidiaries
shall have set aside on its books such reserves as may be required
pursuant to GAAP;
(vi) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens
imposed by law incurred in the ordinary course of business for sums not
delinquent or being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by GAAP shall have
been made in respect thereof;
(vii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, or to secure the payment or
performance of tenders, statutory or regulatory obligations, surety and
appeal bonds, bids, government contracts and leases, performance and
return of money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money but 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, federal or foreign lands or waters);
(viii) judgment and attachment Liens not giving rise to an Event of
Default so long as any appropriate legal proceedings which 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) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with the
ordinary conduct of the business of the Company or any of its Restricted
Subsidiaries;
(x) any interest or title of a lessor under any Capitalized Lease
Obligation or operating lease;
19
(xi) purchase money Liens; provided, however, that (a) the related
purchase money Indebtedness shall not be secured by any Property of the
Company or any Restricted Subsidiary other than the Property so acquired
(including, without limitation, those acquired indirectly through the
acquisition of stock or other ownership interests) and any proceeds
therefrom and (b) the Lien securing such Indebtedness shall be created
within 90 days of such acquisition;
(xii) Liens securing obligations under hedging agreements that the
Company or any Restricted Subsidiary enters into in the ordinary course of
business for the purpose of protecting its production, purchases and
resales against fluctuations in oil or natural gas prices;
(xiii) Liens upon specific items of inventory or other goods of any
Person securing such Person's obligations in respect of bankers'
acceptances issued or created for the account of such Person to facilitate
the purchase, shipment or storage of such inventory or other goods;
(xiv) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other Property
relating to such letters of credit and products and proceeds thereof;
(xv) Liens encumbering Property under construction arising from
progress or partial payments by a customer of the Company or its
Restricted Subsidiaries relating to such Property;
(xvi) Liens encumbering deposits made to secure obligations arising
from statutory, regulatory, contractual or warranty requirements of the
Company or any of its Restricted Subsidiaries, including rights of offset
and set-off;
(xvii) Liens securing Interest Rate Protection Obligations which
Interest Rate Protection Obligations relate to Indebtedness that is
secured by Liens otherwise permitted under this Supplemental Indenture;
(xviii) Liens on, or related to, Properties to secure all or part of
the costs incurred in the ordinary course of business for the exploration,
drilling, development or operation thereof;
(xix) Liens on pipeline or pipeline facilities which arise by
operation of law;
(xx) 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 and natural gas, unitization and pooling declarations and
agreements, area of mutual interest agreements and other agreements which
are customary in the Oil and Gas Business;
20
(xxi) Liens reserved in oil and gas mineral leases for bonus or
rental payments or for compliance with the terms of such leases;
(xxii) Liens constituting survey exceptions, encumbrances, easements
or reservations of, or rights to others for, rights-of-way, zoning or
other restrictions as to the use of real properties, and minor defects of
title which, in the case of any of the foregoing, were not incurred or
created to secure the payment of borrowed money or the deferred purchase
price of Property or services, and in the aggregate do not materially
adversely affect the value of the Properties of the Company and the
Restricted Subsidiaries, taken as a whole, or materially impair the use of
such Properties for the purposes for which such Properties are held by the
Company or any Restricted Subsidiaries;
(xxiii) Liens securing Non-Recourse Indebtedness; provided, however,
that the related Non-Recourse Indebtedness shall not be secured by any
Property of the Company or any Restricted Subsidiary other than the
Property acquired (including, without limitation, those acquired
indirectly through the acquisition of stock or other ownership interests)
by the Company or any Restricted Subsidiary with the proceeds of such
Non-Recourse Indebtedness;
(xxiv) Liens on property existing at the time of acquisition thereof
by the Company or any Subsidiary of the Company and Liens on Property 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; and
(xxv) Liens resulting from the deposit of funds or evidences of
Indebtedness in trust for the purpose of defeasing Indebtedness of the
Company or any of its Restricted Subsidiaries.
Notwithstanding anything in clauses (i) through (xxv) of this definition, the
term "Permitted Liens" shall not include any Liens resulting from the creation,
incurrence, issuance, assumption or guarantee of any Production Payments other
than Production Payments that are created, incurred, issued, assumed or
guaranteed in connection with the financing of, and within 30 days after, the
acquisition of the Properties that are subject thereto.
"Permitted Refinancing Indebtedness" means Indebtedness of the Company or
a Restricted Subsidiary, the net proceeds of which are used to renew, extend,
refinance, refund or repurchase (including, without limitation, pursuant to a
Change of Control Offer or Prepayment Offer) outstanding Indebtedness of the
Company or any Restricted Subsidiary, provided that (i) if the Indebtedness
(including the Securities) being renewed, extended, refinanced, refunded or
repurchased is pari passu with or subordinated in right of payment to either the
Securities or the Guarantees, then such Indebtedness is pari passu with or
subordinated in right of payment to the Securities or the Guarantees, as the
case may be, at least to the same extent as the Indebtedness being renewed,
extended, refinanced, refunded or repurchased, (ii) such Indebtedness has a
Stated Maturity for its final scheduled principal payment that is no earlier
than the Stated
21
Maturity for the final scheduled principal payment of the Indebtedness being
renewed, extended, refinanced, refunded or repurchased and (iii) such
Indebtedness has an Average Life at the time such Indebtedness is incurred that
is equal to or greater than the Average Life of the Indebtedness being renewed,
extended, refinanced, refunded or repurchased; provided, further, that such
Indebtedness is in an aggregate principal amount (or, if such Indebtedness is
issued at a price less than the principal amount thereof, the aggregate amount
of gross proceeds therefrom is) not in excess of the aggregate principal amount
then outstanding of the Indebtedness being renewed, extended, refinanced,
refunded or repurchased (or if the Indebtedness being renewed, extended,
refinanced, refunded or repurchased was issued at a price less than the
principal amount thereof, then not in excess of the amount of liability in
respect thereof determined in accordance with GAAP) plus the amount of any
premium required to be paid in connection with such renewal, extension,
refinancing, refunding or repurchase pursuant to the terms of the Indebtedness
being renewed, extended, refinanced, refunded or repurchased or the amount of
any premium reasonably determined by the Company as necessary to accomplish such
renewal, extension, refinancing, refunding or repurchase, plus the amount of
reasonable fees and expenses incurred by the Company or such Restricted
Subsidiary in connection therewith.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred or preference stock, whether now outstanding or issued after
the date of this Supplemental Indenture, including, without limitation, all
classes and series of preferred or preference stock of such Person.
"Priority Credit Facility Debt" means, collectively, (i) Indebtedness of
the Company or any Restricted Subsidiary (including, without limitation,
Indebtedness under the Bank Credit Facility) secured by Liens not otherwise
permitted under any of clauses (ii) through (xxv), inclusive, of the definition
of "Permitted Liens," and (ii) other Indebtedness or Disqualified Capital Stock
of any Restricted Subsidiary that is not a Guarantor. For purposes of clause (i)
of the definition of "Permitted Indebtedness," Priority Credit Facility Debt
shall be calculated, at any time of determination, (a) in the case of
Indebtedness under the Bank Credit Facility or Indebtedness under any other
instrument or agreement, with reference to the aggregate principal amount
outstanding thereunder at such time, excluding all interest, fees and other
Obligations under such facility, instrument or agreement, and (b) in the case of
Disqualified Capital Stock, in the manner specified in the definition of
"Disqualified Capital Stock."
"Production Payments" means, collectively, Dollar-Denominated Production
Payments and Volumetric Production Payments.
"Property" means, with respect to any Person, any interest of such Person
in any kind of property or asset, whether real, personal or mixed, or tangible
or intangible, including, without limitation, Capital Stock in any other Person.
22
"Public Equity Offering" means an offer and sale of Common Stock of the
Company for cash pursuant to a registration statement that has been declared
effective by the Commission pursuant to the Securities Act (other than a
registration statement on Form S-8 or otherwise relating to equity securities
issuable under any employee benefit plan of the Company).
"Qualified Capital Stock" of any Person means any and all Capital Stock of
such Person other than Disqualified Capital Stock.
"Redemption Date," when used with respect to any Security to be redeemed,
in whole or in part, means the date fixed for such redemption by or pursuant to
this Supplemental Indenture.
"Redemption Price," when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Supplemental
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the February 15 or August 15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.
"Responsible Officer," when used with respect to the Trustee, means any
officer in the Corporate Trust Office, and also means, with respect to a
particular corporate trust matter, any other officer of the Trustee to whom such
matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Investment" means (without duplication) (i) the designation of
a Subsidiary as an Unrestricted Subsidiary in the manner described in the
definition of "Unrestricted Subsidiary" and (ii) any Investment other than a
Permitted Investment.
"Restricted Subsidiary" means any Subsidiary of the Company, whether
existing on or after the date of this Supplemental Indenture, unless such
Subsidiary of the Company is an Unrestricted Subsidiary or is designated as an
Unrestricted Subsidiary pursuant to the terms of this Supplemental Indenture.
"S&P" means Standard and Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors.
"Sale/Leaseback Transaction" means, with respect to the Company or any of
its Restricted Subsidiaries, any arrangement with any Person providing for the
leasing by the Company or any of its Restricted Subsidiaries of any principal
property, acquired or placed into service more than 180 days prior to such
arrangement, whereby such property has been or is to be sold or transferred by
the Company or any of its Restricted Subsidiaries to such Person.
"Securities" has the meaning stated in the first recital of this
Supplemental Indenture and more particularly means any Securities authenticated
and delivered under this Supplemental Indenture.
23
"Securities Act" means the Securities Act of 1933, as amended from time to
time, and any successor act thereto.
"Senior Indebtedness" means any Indebtedness of the Company (whether
outstanding on the date hereof or hereinafter incurred), unless such
Indebtedness is Subordinated Indebtedness.
"Subordinated Indebtedness" means Indebtedness of the Company or a
Guarantor which is expressly subordinated in right of payment to the Securities
or the Guarantees, as the case may be.
"Supplemental Indenture" has the meaning stated in the first paragraph
hereof.
"Trustee" means the Person named as the "Trustee" in the first paragraph
of this Supplemental Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of the Indenture, and thereafter "Trustee"
shall mean such successor Trustee.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that at
the time of determination will be designated an Unrestricted Subsidiary 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 as an Unrestricted Subsidiary so long as (a)
neither the Company nor any Restricted Subsidiary is directly or indirectly
liable pursuant to the terms of any Indebtedness of such Subsidiary; (b) no
default with respect to any Indebtedness of such Subsidiary would permit (upon
notice, lapse of time or otherwise) any holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its Stated Maturity; (c) such designation as an Unrestricted Subsidiary would be
permitted under Section 6.7 hereof; and (d) such designation shall not result in
the creation or imposition of any Lien on any of the Properties of the Company
or any Restricted Subsidiary (other than any Permitted Lien or any Lien the
creation or imposition of which shall have been in compliance with Section 6.12
hereof); provided, however, that with respect to clause (a), the Company or a
Restricted Subsidiary may be liable for Indebtedness of an Unrestricted
Subsidiary if (1) such liability constituted a Permitted Investment or a
Restricted Payment permitted by Section 6.7 hereof, in each case at the time of
incurrence, or (2) the liability would be a Permitted Investment at the time of
designation of such Subsidiary as an Unrestricted Subsidiary. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee by filing a Board Resolution with the Trustee giving effect to such
designation. The Board of Directors of the Company may designate any
Unrestricted Subsidiary as a Restricted Subsidiary if, immediately after giving
effect to such designation, on a pro forma basis, (i) no Default or Event of
Default shall have occurred and be continuing, (ii) the Company could incur
$1.00 of additional Indebtedness (not including the incurrence of Permitted
Indebtedness) under Section 6.9(a) hereof and (iii) if any of the Properties of
the Company or any of its Restricted Subsidiaries would upon such designation
become subject to any Lien (other than a Permitted Lien), the creation or
imposition of such Lien shall have been in compliance with Section 6.12 hereof.
24
"Vice President," when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
"Volumetric Production Payments" means production payment obligations of
the Company or a Restricted Subsidiary recorded as deferred revenue in
accordance with GAAP, together with all undertakings and obligations in
connection therewith.
"Voting Stock" means any class or classes of Capital Stock pursuant to
which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of any Person (irrespective of whether or not, at the time, stock of
any other class or classes shall have, or might have, voting power by reason of
the happening of any contingency).
"Wholly Owned Restricted Subsidiary" means any Restricted Subsidiary of
the Company to the extent (i) all of the Capital Stock or other ownership
interests in such Restricted Subsidiary, other than any directors' qualifying
shares mandated by applicable law, is owned directly or indirectly by the
Company or (ii) such Restricted Subsidiary does substantially all of its
business in one or more foreign jurisdictions and is required by the applicable
laws and regulations of any such foreign jurisdiction to be partially owned by
the government of such foreign jurisdiction or individual or corporate citizens
of such foreign jurisdiction in order for such Restricted Subsidiary to transact
business in such foreign jurisdiction, provided that the Company, directly or
indirectly, owns the remaining Capital Stock or ownership interest in such
Restricted Subsidiary and, by contract or otherwise, controls the management and
business of such Restricted Subsidiary and derives the economic benefits of
ownership of such Restricted Subsidiary to substantially the same extent as if
such Restricted Subsidiary were a wholly owned subsidiary.
Section 1.2 Other Definitions.
Term Defined in
"Change of Control Notice" ........................ 6.13(c)
"Change of Control Offer" ......................... 6.13(a)
"Change of Control Purchase Date" ................. 6.13(c)
"Change of Control Purchase Price" ................ 6.13(a)
"Excess Proceeds" ................................. 6.13(b)
"Funding Guarantor" ............................... 9.5
"Global Security" ................................. Appendix A
"Investment Grade Ratings"......................... 6.18
"Offer Amount" .................................... 6.14(c)
"Offer Period" .................................... 6.14(c)
"OID" ............................................. 2.1
"Original Securities" ............................. 2.1
"Paying Agent" .................................... 2.4
"Payment Restriction" ............................. 6.16
26
"Permitted Consideration" ......................... 6.14(a)
"Prepayment Offer" ................................ 6.14(b)
"Prepayment Offer Notice .......................... 6.14(c)
"Purchase Date" ................................... 6.14(c)
"Registrar" ....................................... 2.4
"Restricted Payment" .............................. 6.7(a)
"Reversion Date" .................................. 6.18
"Security Register" ............................... 2.4
"Surviving Entity" ................................ 4.1(a)
"Suspended Covenants" ............................. 6.18
"Suspension Date" ................................. 6.18
"Suspension Period ................................ 6.18
"U.S. Government Obligations" ..................... 8.4(a)
Section 1.3 Incorporation by Reference of Trust Indenture Act.
Whenever this Supplemental Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Supplemental
Indenture. The following TIA terms used in this Supplemental Indenture have the
following meanings:
"indenture securities" means the Securities,
"indenture security holder" means a Holder,
"indenture to be qualified" means the Base Indenture, as
supplemented by this Supplemental Indenture,
"indenture trustee" or "institutional trustee" means the Trustee,
and
"obligor" on the indenture securities means the Company or any other
obligor on the Securities.
All other TIA terms used in this Supplemental Indenture that are defined
by the TIA, defined by TIA reference to another statute or defined by Commission
rule and not otherwise defined herein have the meanings assigned to them
therein.
Section 1.4 Rules of Construction.
For all purposes of this Supplemental Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article, and include the plural as well as the singular;
25
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP and all accounting calculations will be
determined in accordance with GAAP;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Supplemental Indenture as a whole and not to any
particular Article, Section or other subdivision;
(d) the masculine gender includes the feminine and the neuter;
(e) a "day" means a calendar day;
(f) the term "merger" includes a statutory share exchange and the term
"merged" has a correlative meaning;
(g) provisions apply to successive events and transactions; and
(h) references to agreements and other instruments include subsequent
amendments and waivers but only to the extent not prohibited by this
Supplemental Indenture.
ARTICLE II.
THE SECURITIES
Section 2.1 Amount of Securities; Multiple Issuances.
All Securities shall be identical in all respects other than issue price
and issuance dates. The Securities may be issued in one or more issuances;
provided, however, that any Securities issued with original issue discount
("OID") for Federal income tax purposes shall not be issued as part of the same
issuance as any Securities that are issued with a different amount of OID or are
not issued with OID.
Subject to Section 2.3, the Trustee shall authenticate Securities for
original issue on the Issue Date in the aggregate principal amount of
$175,000,000 (the "Original Securities"). Subject to compliance with Section 6.9
hereof, the Company may issue an unlimited amount of additional Securities from
time to time after the Issue Date. With respect to any Securities issued after
the Issue Date (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
pursuant to Section 2.7, 2.8, 2.9, 6.13, 6.14 or 7.6 or Appendix A), there shall
be established in or pursuant to a resolution of the Board of Directors and,
subject to Section 2.3, set forth or determined in the manner provided in an
Officer's Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of such Securities:
(1) the aggregate principal amount of such Securities which may be
authenticated and delivered under this Supplemental Indenture;
27
(2) the issue price and issuance date of such Securities, including the
date from which interest on such Securities shall accrue; and
(3) if applicable, that such Securities shall be issuable in whole or in
part in the form of one or more Global Securities and, in such case, the
respective depositories for such Global Securities, the form of any legend or
legends which shall be borne by any such Global Security in addition to or in
lieu of that set forth in Exhibit 1 to Appendix A and any circumstances in
addition to or in lieu of those set forth in Section 2.3 of Appendix A in which
any such Global Security may be exchanged in whole or in part for Securities
registered, and any transfer of such Global Security in whole or in part may be
registered, in the name or names of Persons other than the depository for such
Global Security or a nominee thereof.
If any of the terms of any subsequent issuance of Securities are
established by action taken pursuant to a resolution of the Board of Directors,
a copy of an appropriate record of such action shall be certified by the
Secretary or any Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers' Certificate or the trust indenture
supplementary thereto setting forth the terms of such issuance.
Section 2.2 Form and Dating.
Provisions relating to the Securities are set forth in Appendix A, which
is hereby incorporated in and expressly made a part of this Supplemental
Indenture. The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit 1 to Appendix A which is hereby
incorporated in and expressly made a part of this Supplemental Indenture. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule, agreements to which the Company is subject, if any, or usage,
provided that any such notation, legend or endorsement is in a form reasonably
acceptable to the Company. Each Security shall be dated the date of its
authentication. The terms of the Securities set forth in Exhibit 1 to Appendix A
are part of the terms of this Supplemental Indenture.
Section 2.3 Execution and Authentication.
Two Officers of the Company shall sign the Securities for the Company by
manual or facsimile signature. The Company's seal may be impressed, affixed,
imprinted or reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that office
at the time the Trustee authenticates the Security, the Security shall be valid
nevertheless.
At any time and from time to time after the execution and delivery of this
Supplemental Indenture, the Company may deliver additional Securities executed
by the Company to the Trustee for authentication, together with a written order
of the Company signed by two Officers of the Company for the authentication and
delivery of such Securities, and the Trustee in accordance with such written
order of the Company shall authenticate and deliver such Securities.
28
A Security shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Security. The signature
shall be conclusive evidence that the Security has been authenticated under this
Supplemental Indenture.
The Trustee may appoint an authenticating agent reasonably acceptable to
the Company to authenticate the Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Supplemental Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent or agent
for service of notices and demands.
Section 2.4 Registrar and Paying Agent.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the "Registrar") and an
office or agency where Securities may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register (the "Security Register") of the
Securities and of their transfer and exchange. The Company may have one or more
co-registrars and one or more additional paying agents. The term "Paying Agent"
includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Supplemental
Indenture, which shall incorporate the terms of the TIA. The agreement shall
implement the provisions of this Supplemental Indenture that relate to such
agent. The Company shall notify the Trustee of the name and address of any such
agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee
shall act as such and shall be entitled to appropriate compensation therefor
pursuant to Article VI of the Base Indenture. The Company may act as Paying
Agent, Registrar, co-registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and Paying Agent
in connection with the Securities.
Section 2.5 Paying Agent To Hold Money in Trust.
Not later than 10:00 a.m., Eastern standard time, on each due date of the
principal and interest on any Security, the Company shall deposit with the
Paying Agent a sum sufficient to pay such principal and interest when so
becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of the Holders or the Trustee all money held by the Paying Agent for the
payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment. If the Company
acts as Paying Agent, it shall segregate the money held by it as Paying Agent
and hold it as a separate trust fund. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee and to account for any
funds disbursed by the Paying Agent. Upon complying with this Section, the
Paying Agent shall have no further liability for the money delivered to the
Trustee.
29
Section 2.6 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
the Holders. If the Trustee is not the Registrar, the Company shall furnish to
the Trustee, in writing at least five 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.
Section 2.7 Replacement Securities.
If a mutilated Security is surrendered to the Registrar or if the Holder
of a Security claims that such Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Security if the requirements of Section 8-405 of the Uniform Commercial Code are
met and the Holder satisfies any other reasonable requirements of the Trustee.
If required by the Trustee or the Company, such Holder shall furnish an
indemnity bond sufficient in the judgment of the Company and the Trustee to
protect the Company, the Trustee, the Paying Agent, the Registrar and any
co-registrar from any loss which any of them may suffer if a Security is
replaced. The Company and the Trustee may charge the Holder for their expenses
in replacing a Security.
Every replacement Security is an additional obligation of the Company.
Section 2.8 Outstanding Securities.
Securities outstanding at any time are all Securities authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation
and those described in this Section as not outstanding. A Security does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Security.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with this
Supplemental Indenture, on a redemption date or maturity date money sufficient
to pay all principal and interest payable on that date with respect to the
Securities (or portions thereof) to be redeemed or maturing, as the case may be,
and the Paying Agent is not prohibited from paying such money to the Holders of
such Securities on that date pursuant to the terms of this Supplemental
Indenture, then on and after that date such Securities (or portions thereof)
cease to be outstanding and interest on them ceases to accrue.
Section 2.9 Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in
30
the form of definitive Securities but may have variations that the Company
considers appropriate for temporary Securities. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate definitive Securities
and deliver them in exchange for temporary Securities.
Section 2.10 Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel and destroy (subject to the
record retention requirements of the Exchange Act) all Securities surrendered
for registration of transfer, exchange, payment or cancellation and shall, upon
written request, deliver a certificate of such destruction to the Company. The
Company may not issue new Securities to replace Securities it has redeemed, paid
or delivered to the Trustee for cancellation.
Section 2.11 Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, 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 Securities and in Section 6.1 hereof. The Company shall fix or cause to
be fixed any such special record date and payment date to the reasonable
satisfaction of the Trustee and shall promptly mail to each Holder a notice that
states the special record date, the payment date and the amount of defaulted
interest to be paid.
Section 2.12 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use) and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided, however, that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers.
ARTICLE III.
DEFAULTS AND REMEDIES
Section 3.1 Events of Default.
"Event of Default," wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary
31
or be effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body):
(a) default in the payment of the principal of or premium, if any, on any
of the Securities when the same becomes due and payable, whether such payment is
due at Stated Maturity, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ pursuant to a Change of
Control Offer or a Prepayment Offer, upon acceleration or otherwise; or
(b) default in the payment of any installment of interest on any of the
Securities, when it becomes due and payable, and the continuance of such default
for a period of 30 days; or
(c) default in the performance or breach of the provisions of Article IV
hereof, the failure to make or consummate a Change of Control Offer in
accordance with the provisions of Section 6.13 or the failure to make or
consummate a Prepayment Offer in accordance with the provisions of Section 6.14;
or
(d) the Company or any Guarantor shall fail to perform or observe any
other term, covenant or agreement contained in the Securities, any Guarantee or
the Indenture (other than a default specified in subparagraph (a), (b) or (c)
above) for a period of 60 days after written notice of such failure stating that
it is a "notice of default" hereunder and requiring the Company or such
Guarantor, as the case may be, to remedy the same shall have been given (x) to
the Company by the Trustee or (y) to the Company and the Trustee by the Holders
of at least 25% in aggregate principal amount of the Securities then
Outstanding; or
(e) the occurrence and continuation beyond any applicable grace period of
any default in the payment of the principal of (or premium, if any, on) or
interest on any Indebtedness of the Company (other than the Securities) or any
Guarantor or any other Restricted Subsidiary for money borrowed when due, or any
other default resulting in acceleration of any Indebtedness of the Company or
any Guarantor or any other Restricted Subsidiary for money borrowed, provided
that the aggregate principal amount of such Indebtedness shall exceed
$20,000,000; or
(f) any Guarantee shall for any reason cease to be, or be asserted by the
Company or any Guarantor, as applicable, not to be, in full force and effect
(except pursuant to the release of any such Guarantee in accordance with this
Supplemental Indenture); or
(g) final judgments or orders rendered against the Company or any
Guarantor or any other Restricted Subsidiary that are unsatisfied and that
require the payment in money, either individually or in an aggregate amount,
that is more than $20,000,000 over the coverage under applicable insurance
policies and either (A) commencement by any creditor of an enforcement
proceeding upon such judgment (other than a judgment that is stayed by reason of
pending appeal or otherwise) or (B) the occurrence of a 60-day period during
which a stay of such judgment or order, by reason of pending appeal or
otherwise, was not in effect; or
(h) the entry of a decree or order by a court having jurisdiction in the
premises (A) for relief in respect of the Company or any Guarantor or any other
Restricted Subsidiary in an
32
involuntary case or proceeding under the Federal Bankruptcy Code or any other
applicable federal or state bankruptcy, insolvency, reorganization or other
similar law or (B) adjudging the Company or any Guarantor or any other
Restricted Subsidiary bankrupt or insolvent, or approving a petition seeking
reorganization, arrangement, adjustment or composition of the Company or any
Guarantor or any other Restricted Subsidiary under the Federal Bankruptcy Code
or any applicable federal or state law, or appointing under any such law a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or any Guarantor or any other Restricted
Subsidiary or of a substantial part of its consolidated assets, or ordering the
winding up or liquidation of its affairs, and the continuance of any such decree
or order for relief or any such other decree or order unstayed and in effect for
a period of 60 consecutive days; or
(i) the commencement by the Company or any Guarantor or any other
Restricted Subsidiary of a voluntary case or proceeding under the Federal
Bankruptcy Code or any other applicable federal or state bankruptcy, insolvency,
reorganization or other similar law or any other case or proceeding to be
adjudicated bankrupt or insolvent, or the consent by the Company or any
Guarantor or any other Restricted Subsidiary to the entry of a decree or order
for relief in respect thereof in an involuntary case or proceeding under the
Federal Bankruptcy Code or any other applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against it, or the filing by the
Company or any Guarantor or any other Restricted Subsidiary of a petition or
consent seeking reorganization or relief under any applicable federal or state
law, or the consent by it under any such law to the filing of any such petition
or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee or sequestrator (or other similar official) of the
Company or any Guarantor or any other Restricted Subsidiary or of any
substantial part of its consolidated assets, or the making by it of an
assignment for the benefit of creditors under any such law, or the admission by
it in writing of its inability to pay its debts generally as they become due or
taking of corporate action by the Company or any Guarantor or any other
Restricted Subsidiary in furtherance of any such action.
Section 3.2 Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 3.1(h) or (i) hereof) occurs and is continuing, the Trustee or the
Holders of not less than 25% in aggregate principal amount of the Securities
then Outstanding, by written notice to the Company (and to the Trustee if such
notice is given by the Holders), may, and the Trustee upon the request of the
Holders of not less than 25% in aggregate principal amount of the Outstanding
Securities shall, by a notice in writing to the Company, declare all unpaid
principal of, premium, if any, and accrued and unpaid interest on all the
Securities to be due and payable immediately, upon which declaration all amounts
payable in respect of the Securities shall be immediately due and payable. If an
Event of Default specified in Section 3.1(h) or (i) hereof occurs and is
continuing, the amounts described above shall become and be immediately due and
payable without any declaration, notice or other act on the part of the Trustee
or any Holder.
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Promptly after the occurrence of a declaration of acceleration, the
Company shall notify each holder of Senior Indebtedness thereof, but failure to
give any such notice shall not affect such declaration or its consequences.
At any time after a declaration of acceleration has been made and before a
judgment or decree for payment of the money due has been obtained by the Trustee
as hereinafter in this Article provided, the Holders of a majority in aggregate
principal amount of the Securities Outstanding, by written notice to the
Company, the Guarantors and the Trustee, may rescind and annul such declaration
and its consequences if
(a) the Company or any Guarantor has paid or deposited with the Trustee a
sum sufficient to pay,
(1) all overdue interest on all Outstanding Securities,
(2) all unpaid principal of (and premium, if any, on) any
Outstanding Securities which have become due otherwise than by such
declaration of acceleration, including any Securities required to have
been purchased on a Change of Control Date or a Purchase Date pursuant to
a Change of Control Offer or a Prepayment Offer, as applicable, and
interest on such unpaid principal at the rate borne by the Securities,
(3) to the extent that payment of such interest is lawful, interest
on overdue interest and overdue principal at the rate borne by the
Securities (without duplication of any amount paid or deposited pursuant
to clauses (1) and (2) above), and
(4) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
(b) the rescission would not conflict with any judgment or decree of a
court of competent jurisdiction as certified to the Trustee by the Company; and
(c) all Events of Default, other than the non-payment of amounts of
principal of (or premium, if any, on) or interest on Securities which have
become due solely by such declaration of acceleration, have been cured or waived
as provided in Section 3.13 hereof.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Notwithstanding the foregoing, if an Event of Default specified in Section
3.1(e) hereof shall have occurred and be continuing, such Event of Default and
any consequential acceleration shall be automatically rescinded if the
Indebtedness that is the subject of such Event of Default has been repaid, or if
the default relating to such Indebtedness is waived or cured and if such
Indebtedness has been accelerated, then the holders thereof have rescinded their
declaration of acceleration in respect of such Indebtedness (provided, in each
case, that such repayment, waiver, cure or rescission is effected within a
period of 10 days from the continuation of such
34
default beyond the applicable grace period or the occurrence of such
acceleration), and written notice of such repayment, or cure or waiver and
rescission, as the case may be, shall have been given to the Trustee by the
Company and countersigned by the holders of such Indebtedness or a trustee,
fiduciary or agent for such holders or other evidence satisfactory to the
Trustee of such events is provided to the Trustee, within 30 days after any such
acceleration in respect of the Securities, and so long as such rescission of any
such acceleration of the Securities does not conflict with any judgment or
decree as certified to the Trustee by the Company.
Section 3.3 Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(a) default is made in the payment of any installment of interest on any
Security when such interest becomes due and payable and such default continues
for a period of 30 days, or
(b) default is made in the payment of the principal of (or premium, if
any, on) any Security at the Maturity thereof or with respect to any Security
required to have been purchased by the Company on the Change of Control Purchase
Date or the Purchase Date pursuant to a Change of Control Offer or Prepayment
Offer, as applicable, then the Company will, upon demand of the Trustee, pay to
the Trustee for the benefit of the Holders of such Securities, the whole amount
then due and payable on such Securities for principal (and premium, if any) and
interest, and interest on any overdue principal (and premium, if any) and, to
the extent that payment of such interest shall be legally enforceable, upon any
overdue installment of interest, at the rate borne by the Securities, and, in
addition thereto, 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.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
money adjudged or decreed to be payable in the manner provided by law out of the
Property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Supplemental Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
Section 3.4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company, any Guarantor or any other obligor
upon the Securities, their creditors or the Property
35
of the Company, any Guarantor or of such other obligor, the Trustee
(irrespective of whether the principal of the Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company, the Guarantors or
such other obligor for the payment of overdue principal, premium, if any, or
interest) shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(a) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Securities and
to file such other papers or documents and take any other actions including
participation as a full member of any creditor or other committee 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 of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any money or other Property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay 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 Article VI of the Base Indenture.
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 Securities
or the Guarantees or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 3.5 Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under the Indenture or the Securities or
the Guarantees may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
Section 3.6 Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in the case of the distribution of such money on account of principal (or
premium, if any) or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
36
FIRST: to the payment of all amounts due the Trustee under Article
VI of the Base Indenture;
SECOND: to the payment of the amounts then due and unpaid for
principal of (and premium, if any, on) and interest on the Securities in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according
to the amounts due and payable on such Securities for principal (and
premium, if any) and interest, respectively; and
THIRD: the balance, if any, to the Company, or to whomsoever may be
lawfully entitled to receive the same, or as a court of competent
jurisdiction may direct.
Section 3.7 Limitation on Suits.
No Holder of any Securities shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Supplemental Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(b) the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority or more in
aggregate principal amount of the Outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
the Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under the Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
37
Section 3.8 Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in the Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment, as provided herein (including, if applicable, Article VIII hereof) and
in such Security of the principal of (and premium if any, on) and (subject to
Section 2.11 hereof) interest on, such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder.
Section 3.9 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under the Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Guarantors, the Trustee and the Holders shall be
restored severally and respectively to their former positions hereunder and
thereunder and all rights and remedies of the Trustee and the Holders shall
continue as though no such proceeding had been instituted.
Section 3.10 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
2.7 hereof, no right or remedy herein conferred upon or reserved to the Trustee
or to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 3.11 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
Section 3.12 Control by Holders.
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities shall have the right to direct the time, method and
place of conducting any proceeding
38
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee, provided that
(a) such direction shall not be in conflict with any rule of law or with
the Indenture,
(b) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction,
(c) the Trustee need not take any action which might involve it in
personal liability, and
(d) the Trustee may decline to take any action that would benefit some
Holders to the detriment of other Holders.
Prior to taking any such action under this Section, the Trustee shall be
entitled to such reasonable security or indemnity as it may require against the
costs, expenses and liabilities that may be incurred by it in taking or
declining to take any such action hereunder.
Section 3.13 Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities may on behalf of the Holders of all the Securities
waive any existing Default or Event of Default hereunder and its consequences,
except a Default or Event of Default
(a) in respect of the payment of the principal of (or premium, if any, on)
or interest on any Security, or
(b) in respect of a covenant or provision hereof which under Article V
hereof cannot be modified or amended without the consent of the Holder of each
Outstanding Security affected thereby.
Upon any such waiver, such Default or Event of Default shall cease to
exist for every purpose under the Indenture, but no such waiver shall extend to
any subsequent or other fault or Event of Default or impair any right consequent
thereon.
Section 3.14 Waiver of Stay, Extension or Usury Laws.
Each of the Company and the Guarantors covenants (to the extent that each
may lawfully do so) that it will not at any time insist upon, plead or in any
manner whatsoever claim or take the benefit or advantage of, any stay,
extension, or usury law or other law wherever enacted, now or at any time
hereafter in force, which would prohibit or forgive the Company or any Guarantor
from paying all or any portion of the principal of (premium, if any, on) or
interest on the Securities as contemplated herein, or which may affect the
covenants or the performance of the Indenture; and (to the extent that it may
lawfully do so) each of the Company and the Guarantors hereby expressly waives
all benefit or advantage of any such law, and covenant that they will not
39
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE IV.
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 4.1 Company May Consolidate, etc., Only on Certain Terms.
The Company shall not, in any single transaction or a series of related
transactions, merge or consolidate with or into any other Person, or sell,
assign, convey, transfer, lease or otherwise dispose of all or substantially all
the Properties of the Company and its Restricted Subsidiaries on a consolidated
basis to any Person or group of Affiliated Persons, and the Company shall not
permit any of its Restricted Subsidiaries to enter into any such transaction or
series of related transactions if such transaction or series of transactions, in
the aggregate, would result in a sale, assignment, conveyance, transfer, lease
or other disposition of all or substantially all of the Properties of the
Company and its Restricted Subsidiaries on a consolidated basis to any other
Person or group of Affiliated Persons, unless at the time and after giving
affect thereto:
(a) either (i) if the transaction is a merger or consolidation, the
Company shall be the surviving Person of such merger or consolidation, or (ii)
the Person (if other than the Company) formed by such consolidation or into
which the Company is merged or to which the Properties of the Company or its
Restricted Subsidiaries, as the case may be, are sold, assigned, conveyed,
transferred, leased or otherwise disposed of (any such surviving Person or
transferee Person being called the "Surviving Entity") shall be a corporation
organized and existing under the laws of the United States of America, any state
thereof or the District of Columbia and shall, in either case, expressly assume
by an indenture supplemental to this Supplemental Indenture executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Supplemental Indenture,
and, in each case, this Supplemental Indenture shall remain in full force and
effect;
(b) immediately after giving effect to such transaction or series of
related transactions on a pro forma basis (and treating any Indebtedness not
previously an obligation of the Company or any of its Restricted Subsidiaries
which becomes the obligation of the Company or any of its Restricted
Subsidiaries in connection with or as a result of such transaction or
transactions as having been incurred at the time of such transaction or
transactions), no Default or Event of Default shall have occurred and be
continuing;
(c) except in the case of the consolidation or merger of the Company with
or into a Restricted Subsidiary or any Restricted Subsidiary with or into the
Company or another Restricted Subsidiary, immediately before and immediately
after giving effect to such transaction or transactions on a pro forma basis
(assuming that the transaction or transactions occurred on the first day of the
period of four full fiscal quarters ending immediately prior to the consummation
of such transaction or transactions, with the appropriate adjustments with
respect to the transaction or transactions being included in such pro forma
calculation), the Company (or
40
the Surviving Entity if the Company is not the continuing obligor under this
Supplemental Indenture) could incur $1.00 of additional Indebtedness (excluding
Permitted Indebtedness) under Section 6.9(a) hereof;
(d) if the Company is not the continuing obligor under this Supplemental
Indenture, then each Guarantor, unless it is the Surviving Entity, shall have by
supplemental indenture confirmed that its Guarantee of the Securities shall
apply to the Surviving Entity's obligations under this Supplemental Indenture
and the Securities:
(e) if any of the Properties of the Company or any of its Restricted
Subsidiaries would upon such transaction or series of related transactions
become subject to any Lien (other than a Permitted Lien), the creation or
imposition of such Lien shall have been in compliance with Section 6.12 hereof;
and
(f) the Company (or the Surviving Entity if the Company is not the
continuing obligor under this Supplemental Indenture) shall have delivered to
the Trustee, in form and substance reasonably satisfactory to the Trustee, (i)
an Officers' Certificate stating that such consolidation, merger, conveyance,
transfer, lease or other disposition and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture,
comply with this Supplemental Indenture and (ii) an Opinion of Counsel stating
that the requirements of Section 4.1(a) have been satisfied.
Section 4.2 Successor Substituted.
Upon any consolidation of the Company with or merger of the Company into
any other corporation or any sale, assignment, lease, conveyance, transfer or
other disposition of all or substantially all of the Properties of the Company
and its Restricted Subsidiaries on a consolidated basis in accordance with
Section 4.1 hereof, the Surviving Entity shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Supplemental Indenture with the same effect as if such Surviving Entity had been
named as the Company herein, and in the event of any such sale, assignment,
lease, conveyance, transfer or other disposition, the Company (which term shall
for this purpose mean the Person named as the "Company" in the first paragraph
of this Supplemental Indenture or any successor Person which shall theretofore
become such in the manner described in Section 4.1 hereof), except in the case
of a lease, shall be discharged of all obligations and covenants under this
Supplemental Indenture and the Securities, and the Company may be dissolved and
liquidated and such dissolution and liquidation shall not cause a Change of
Control under clause (e) of the definition thereof to occur unless the sale,
assignment, lease, conveyance, transfer or other disposition of all or
substantially all of the Properties of the Company and its Restricted
Subsidiaries on a consolidated basis to any Person otherwise results in a Change
of Control.
41
ARTICLE V.
SUPPLEMENTAL INDENTURES
Section 5.1 Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, each of the Guarantors, when authorized by a Board Resolution,
and the Trustee upon Company Request, at any time and from time to time, may
enter into one or more indentures supplemental to this Supplemental Indenture,
in form satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company contained in
this Supplemental Indenture and in the Securities; or
(b) to add to the covenants of the Company for the benefit of the Holders
or to surrender any right or power herein conferred upon the Company; or
(c) to comply with any requirement of the SEC in connection with
qualifying this Supplemental Indenture under the TIA or maintaining such
qualification thereafter; or
(d) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising under
this Supplemental Indenture, provided that such action shall not adversely
affect the interests of the Holders in any material respect; or
(e) to secure the Securities or the Guarantees pursuant to the
requirements of Section 6.12 hereof or otherwise; or
(f) to add any Restricted Subsidiary as an additional Guarantor as
provided in Sections 6.8 and 6.10(a) hereof or to evidence the succession of
another Person to any Guarantor pursuant to Section 9.2(b) hereof and the
assumption by any such successor of the covenants and agreements of such
Guarantor contained herein, in the Securities and in the Guarantee of such
Guarantor; or
(g) to release a Guarantor from its Guarantee pursuant to Section 9.3
hereof; or
(h) to provide for uncertificated Securities in addition to or in place of
certificated Securities.
Section 5.2 Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities, by Act of said Holders delivered
to the Company and the Trustee, the Company, when authorized by a Board
Resolution, each of the Guarantors, when authorized
42
by a Board Resolution, and the Trustee upon Company Request may enter into an
indenture or indentures supplemental to this Supplemental Indenture for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Supplemental Indenture or of modifying in any manner
the rights of the Holders under this Supplemental Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby:
(a) change the Stated Maturity of the principal of, or any installment of
interest on, any Security, or reduce the principal amount thereof or the rate of
interest thereon or any premium thereon, or change the coin or currency in which
principal of any Security or any premium or the interest on any Security is
payable, or impair the right to institute suit for the enforcement of any such
payment after the Stated Maturity thereof (or, in the case of redemption, on or
after the Redemption Date); or
(b) reduce the percentage of aggregate principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver of
compliance with certain provisions of this Supplemental Indenture or certain
defaults hereunder or the consequences of a default provided for in this
Supplemental Indenture; or
(c) modify any of the provisions of this Section or Sections 3.13 and 6.18
hereof, except to increase any such percentage or to provide that certain other
provisions of this Supplemental Indenture cannot be modified or waived without
the consent of the Holder of each Outstanding Security affected thereby; or
(d) amend, change or modify the obligation of the Company to make and
consummate a Change of Control Offer in the event of a Change of Control
Triggering Event, or to make and consummate a Prepayment Offer with respect to
any Asset Sale, or modify any of the provisions or definitions with respect
thereto.
It shall not be necessary for any Act of the Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 5.3 Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Supplemental Indenture or the Base Indenture, the
Trustee shall be entitled to receive, and shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by the Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Supplemental
Indenture or the Base Indenture or otherwise.
43
Section 5.4 Effects of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Supplemental Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Supplemental Indenture for all
purposes; and every Holder of Securities theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby.
Section 5.5 Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 5.6 References in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company, to any such supplemental indenture may be prepared and executed by the
Company, and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.
Section 5.7 Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 5.2 hereof, the
Company shall give notice thereof to the Holders of each Outstanding Security
affected, in the manner provided for in Section 10.3 hereof, setting forth in
general terms the substance of such supplemental indenture.
ARTICLE VI.
COVENANTS
Section 6.1 Payment of Principal, Premium, if any, and Interest.
The Company covenants and agrees for the benefit of the Holders that it
will duly and punctually pay the principal of (and premium, if any, on) and
interest on the Securities in accordance with the terms of the Securities and
the Indenture.
Section 6.2 Maintenance of Office or Agency.
The Company shall maintain an office or agency where Securities may be
presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company in respect of the Securities, the Guarantees and the Indenture may
be served. The New York office of the Trustee shall be such office or agency of
the Company, unless the Company shall designate and maintain some
44
other office or agency for one or more of such purposes. The Company will give
prompt written notice to the Trustee of any change in the location of any such
office or agency. If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the aforementioned office of the Trustee, and the Company hereby
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind any such designation. Further,
if at any time there shall be no such office or agency in The City of New York
where the Securities may be presented or surrendered for payment, the Company
shall forthwith designate and maintain such an office or agency in The City of
New York, in order that the Securities shall at all times be payable in The City
of New York. The Company will give prompt written notice to the Trustee of any
such designation or rescission and any change in the location of any such other
office or agency.
Section 6.3 Corporate Existence.
Except as expressly permitted by Article IV hereof, Section 6.14 hereof or
other provisions of this Supplemental Indenture, the Company shall do or cause
to be done all things necessary to preserve and keep in full force and effect
the corporate existence, rights (charter and statutory) and franchises of the
Company and each Restricted Subsidiary; provided, however, that the Company
shall not be required to preserve any such existence of its Restricted
Subsidiaries, rights or franchises, if the Board of Directors of the Company
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Restricted Subsidiaries, taken as
a whole, and that the loss thereof is not disadvantageous in any material
respect to the Holders.
Section 6.4 Payment of Taxes; Maintenance of Properties; Insurance.
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (a) all material taxes, assessments and
governmental charges levied or imposed upon the Company or any Restricted
Subsidiary or upon the income, profits or Property of the Company or any
Restricted Subsidiary and (b) all lawful claims for labor, materials and
supplies, which, if unpaid, might by law become a Lien upon the Property of the
Company or any Restricted Subsidiary; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings and for which
appropriate provision has been made in accordance with GAAP.
The Company shall cause all material Properties owned by the Company or
any Restricted Subsidiary and used or held for use in the conduct of its
business or the business of any Restricted Subsidiary to be maintained and kept
in good condition, repair and working order (ordinary wear and tear excepted),
all as in the judgment of the Company or such Restricted Subsidiary may be
necessary so that its business may be properly and advantageously conducted at
all times; provided, however, that nothing in this Section shall prevent the
Company or any
45
Restricted Subsidiary from discontinuing the maintenance of any of such
Properties if such discontinuance is, in the judgment of the Company or such
Restricted Subsidiary, as the case may be, desirable in the conduct of the
business of the Company or such Restricted Subsidiary and not disadvantageous in
any material respect to the Holders. Notwithstanding the foregoing, nothing
contained in this Section 6.4 shall limit or impair in any way the right of the
Company and its Restricted Subsidiaries to sell, divest and otherwise to engage
in transactions that are otherwise permitted by this Supplemental Indenture.
The Company shall at all times keep all of its, and cause its Restricted
Subsidiaries to keep their, Properties which are of an insurable nature insured
with insurers, believed by the Company to be responsible, against loss or damage
to the extent that property of similar character and in a similar location is
usually so insured by corporations similarly situated and owning like
Properties.
The Company or any Restricted Subsidiary may adopt such other plan or
method of protection, in lieu of or supplemental to insurance with insurers,
whether by the establishment of an insurance fund or reserve to be held and
applied to make good losses from casualties, or otherwise, conforming to the
systems of self-insurance maintained by corporations similarly situated and in a
similar location and owning like Properties, as may be determined by the Board
of Directors of the Company or such Restricted Subsidiary.
Section 6.5 Statement by Officers as to Default.
(a) The Company shall deliver to the Trustee, within 100 days after the
end of each fiscal year of the Company and within 45 days of the end of each of
the first, second and third quarters of each fiscal year of the Company, an
Officers' Certificate stating that a review of the activities of the Company and
its Restricted Subsidiaries during the preceding fiscal quarter or fiscal year,
as applicable, 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 Supplemental Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
such Officer's knowledge the Company has kept, observed, performed and fulfilled
each and every condition and covenant contained in this Supplemental Indenture
and no Default or Event of Default has occurred and is continuing (or, if a
Default or Event of Default shall have occurred to either such Officer's
knowledge, describing all such Defaults or Events of Default of which such
Officer may have knowledge and what action the Company is taking or proposes to
take with respect thereto). Such Officers' Certificate shall comply with TIA
Section 314(a)(4). For purposes of this Section 6.5(a), such compliance shall be
determined without regard to any period of grace or requirement of notice under
this Supplemental Indenture.
(b) The Company shall, so long as any of the Securities is outstanding,
deliver to the Trustee, upon any of its Officers becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Company proposes to take with respect thereto,
within 10 days of its occurrence.
46
Section 6.6 Provision of Financial Information.
The Company (and the Guarantors, if applicable) shall file on a timely
basis with the SEC, to the extent such filings are accepted by the Commission
and whether or not the Company has a class of securities registered under the
Exchange Act, the annual reports, quarterly reports and other documents that the
Company would be required to file if it were subject to Section 13 or 15 of the
Exchange Act. The Company (and the Guarantors, if applicable) shall also file
with the Trustee (with exhibits), and provide to each Holder of Securities
(without exhibits), without cost to such Holder, copies of such reports and
documents within 15 days after the date on which the Company (and the
Guarantors, if applicable) file such reports and documents with the Commission
or the date on which the Company (and the Guarantors, if applicable) would be
required to file such reports and documents if the Company were so required and,
if filing such reports and documents with the Commission is not accepted by the
Commission or is prohibited under the Exchange Act, the Company shall supply at
its cost copies of such reports and documents (including any exhibits thereto)
to any Holder of Securities promptly upon written request given in accordance
with Section 10.2 hereof. The Company is obligated to make available, upon
request, to any Holder of Securities the information required by Rule 144A(d)(4)
under the Securities Act, during any period in which the Company is not subject
to Section 13 or 15(d) of the Exchange Act.
Section 6.7 Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, take the following actions:
(i) declare or pay any dividend on, or make any distribution to
holders of, any shares of Capital Stock of the Company or any Restricted
Subsidiary (other than dividends or distributions payable solely in shares
of Qualified Capital Stock of the Company or such Restricted Subsidiary or
in options, warrants or other rights to purchase Qualified Capital Stock
of the Company or such Restricted Subsidiary);
(ii) purchase, redeem or otherwise acquire or retire for value any
Capital Stock of the Company or any Affiliate thereof (other than any
Wholly Owned Restricted Subsidiary of the Company) or any options,
warrants or other rights to acquire such Capital Stock (other than the
purchase, redemption, acquisition or retirement of any Disqualified
Capital Stock of the Company solely in shares of Qualified Capital Stock
of the Company);
(iii) make any principal payment on or repurchase, redeem, defease
or otherwise acquire or retire for value, prior to any scheduled principal
payment, scheduled sinking fund payment or maturity, any Subordinated
Indebtedness, except in any case out of the proceeds of Permitted
Refinancing Indebtedness, or
(iv) make any Restricted Investment;
47
(such payments or other actions described in clauses (i) through (iv) being
collectively referred to as "Restricted Payments"), unless at the time of and
after giving effect to the proposed Restricted Payment (the amount of any such
Restricted Payment, if other than cash, shall be the amount determined by the
Board of Directors of the Company, whose determination shall be conclusive and
evidenced by a Board Resolution), (A) no Default or Event of Default shall have
occurred and be continuing, (B) the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in accordance with Section
6.9(a) hereof and (C) the aggregate amount of all Restricted Payments declared
or made after the date of this Supplemental Indenture shall not exceed the sum
(without duplication) of the following:
(1) 50% of the Consolidated Net Income of the Company accrued on a
cumulative basis during the period beginning on February 1, 2004 and
ending on the last day of the Company's last fiscal quarter ending prior
to the date of such proposed Restricted Payment (or, if such Consolidated
Net Income shall be a loss, minus 100% of such loss), plus
(2) the aggregate Net Cash Proceeds, or the Fair Market Value of
Property other than cash, received after the date of this Supplemental
Indenture by the Company from the issuance or sale (other than to any of
its Restricted Subsidiaries) of shares of Qualified Capital Stock of the
Company or any options, warrants or rights to purchase such shares of
Qualified Capital Stock of the Company, plus
(3) the aggregate Net Cash Proceeds, or the Fair Market Value of
Property other than cash, received after the date of this Supplemental
Indenture by the Company (other than from any of its Restricted
Subsidiaries) upon the exercise of any options, warrants or rights to
purchase shares of Qualified Capital Stock of the Company, plus
(4) the aggregate Net Cash Proceeds received after the date of this
Supplemental Indenture by the Company from the issuance or sale (other
than to any of its Restricted Subsidiaries) of Indebtedness or shares of
Disqualified Capital Stock that have been converted into or exchanged for
Qualified Capital Stock of the Company, together with the aggregate cash
received by the Company at the time of such conversion or exchange, plus
(5) to the extent not otherwise included in Consolidated Net Income,
the net reduction in Investments in Unrestricted Subsidiaries resulting
from dividends, repayments of loans or advances, or other transfers of
assets, in each case to the Company or a Restricted Subsidiary after the
date of this Supplemental Indenture from any Unrestricted Subsidiary or
from the redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary (valued in each case as provided in the definition of
"Investment"), not to exceed in the case of any Unrestricted Subsidiary
the total amount of Investments (other than Permitted Investments) in such
Unrestricted Subsidiary made by the Company and its Restricted
Subsidiaries in such Unrestricted Subsidiary after the date of this
Supplemental Indenture.
48
(b) Notwithstanding paragraph (a) above, the Company and its Restricted
Subsidiaries may take the following actions so long as (in the case of clauses
(iii), (iv), (v) and (vii) below) no Default or Event of Default shall have
occurred and be continuing:
(i) the payment of any dividend on any Capital Stock of the Company
within 60 days after the date of declaration thereof, if at such
declaration date such declaration complied with the provisions of
paragraph (a) above (and such payment shall be deemed to have been paid on
such date of declaration for purposes of any calculation required by the
provisions of paragraph (a) above);
(ii) the payment of any dividend payable from a Restricted
Subsidiary to the Company or any other Restricted Subsidiary of the
Company;
(iii) the repurchase, redemption or other acquisition or retirement
of any shares of any class of Capital Stock of the Company or any
Restricted Subsidiary, in exchange for, or out of the aggregate Net Cash
Proceeds of, a substantially concurrent issue and sale (other than to a
Restricted Subsidiary) of shares of Qualified Capital Stock of the
Company;
(iv) the repurchase, redemption, repayment, defeasance or other
acquisition or retirement for value of any Subordinated Indebtedness in
exchange for, or out of the aggregate Net Cash Proceeds from, a
substantially concurrent issue and sale (other than to a Restricted
Subsidiary) of shares of Qualified Capital Stock of the Company;
(v) the purchase, redemption, repayment, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness (other
than Disqualified Capital Stock) in exchange for, or out of the aggregate
net cash proceeds of, a substantially concurrent incurrence (other than to
a Restricted Subsidiary) of Subordinated Indebtedness of the Company so
long as (A) the principal amount of such new Indebtedness does not exceed
the principal amount (or, if such Subordinated Indebtedness being
refinanced provides for an amount less than the principal amount thereof
to be due and payable upon a declaration of acceleration thereof, such
lesser amount as of the date of determination) of the Subordinated
Indebtedness being so purchased, redeemed, repaid, defeased, acquired or
retired, plus the amount of any premium required to be paid in connection
with such refinancing pursuant to the terms of the Indebtedness refinanced
or the amount of any premium reasonably determined by the Company as
necessary to accomplish such refinancing, plus the amount of expenses of
the Company incurred in connection with such refinancing, (B) such new
Indebtedness is subordinated to the Securities at least to the same extent
as such Subordinated Indebtedness so purchased, redeemed, repaid,
defeased, acquired or retired, and (C) such new Indebtedness has an
Average Life to Stated Maturity that is longer than the Average Life to
Stated Maturity of the Securities and such new Indebtedness has a Stated
Maturity for its final scheduled principal payment that is at least 91
days later than the Stated Maturity for the final scheduled principal
payment of the Securities;
49
(vi) loans made to officers, directors or employees of the Company
or any Restricted Subsidiary approved by the Board of Directors of the
Company in an aggregate amount not to exceed $1,000,000 outstanding at any
one time, the proceeds of which are used solely (A) to purchase common
stock of the Company in connection with a restricted stock or employee
stock purchase plan, or to exercise stock options received pursuant to an
employee or director stock option plan or other incentive plan, in a
principal amount not to exceed the exercise price of such stock options or
(B) to refinance loans, together with accrued interest thereon, made
pursuant to item (A) of this clause (v); and
(vii) other Restricted Payments in an aggregate amount not to exceed
$10,000,000.
The actions described in clauses (i), (iii), (iv) and (vi) of this
paragraph (b) shall be Restricted Payments that shall be permitted to be made in
accordance with this paragraph (b) but shall reduce the amount that would
otherwise be available for Restricted Payments under clause (3) of paragraph (a)
(provided that any dividend paid pursuant to clause (i) of this paragraph (b)
shall reduce the amount that would otherwise be available under clause (3) of
paragraph (a) when declared, but not also when subsequently paid pursuant to
such clause (i)), and the actions described in clauses (ii), (v) and (vii) of
this paragraph (b) shall be permitted to be taken in accordance with this
paragraph and shall not reduce the amount that would otherwise be available for
Restricted Payments under clause (3) of paragraph (a).
(c) In computing Consolidated Net Income under paragraph (a) above, (1)
the Company shall use audited financial statements for the portions 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 (2) 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 in the good faith determination of the Company be permitted under
the requirements of this Supplemental Indenture, such Restricted Payment shall
be deemed to have been made in compliance with this Supplemental 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.
Section 6.8 Limitation on Guarantees by Restricted Subsidiaries.
The Company shall not cause or permit any Restricted Subsidiary to
guarantee, assume or in any other manner become liable (whether directly or
indirectly) with respect to any Indebtedness of the Company or any other
Restricted Subsidiary unless such Restricted Subsidiary simultaneously executes
and delivers an indenture supplemental to this Supplemental Indenture agreeing
to be bound by its terms applicable to a Guarantor and providing for a Guarantee
of the Securities on the same terms as the guarantee of such Indebtedness,
except that (a) such Guarantee need not be secured unless required pursuant to
Section 6.12 and (b) if such
50
Indebtedness is by its terms expressly subordinated to the Securities or the
Subordinated Guarantees, any such guarantee, assumption or other liability of
such Restricted Subsidiary with respect to such Indebtedness shall be
subordinated to such Restricted Guarantor's Guarantee at least to the same
extent as such Subordinated Indebtedness is subordinated to the Securities;
provided, however, that this clause (b) shall not be applicable to any guarantee
of any Restricted Subsidiary that (i) existed at the time such Person became a
Subsidiary of the Company and (ii) was not incurred in connection with, or in
contemplation of, such Person's becoming a Subsidiary of the Company.
Section 6.9 Limitation on Indebtedness and Disqualified Capital Stock.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create, incur, assume, guarantee or in any manner become
directly or indirectly liable for the payment of (collectively, "incur") any
Indebtedness (including any Acquired Indebtedness), except for Permitted
Indebtedness, and the Company shall not, and shall not permit any of its
Restricted Subsidiaries to, issue any Disqualified Capital Stock (except for the
issuance by the Company of Disqualified Capital Stock (A) which is redeemable at
the Company's option in cash or Qualified Capital Stock and (B) the dividends on
which are payable at the Company's option in cash or Qualified Capital Stock);
provided however, that the Company and its Restricted Subsidiaries that are
Guarantors may incur Indebtedness or issue shares of Disqualified Capital Stock
if (i) at the time of such event and after giving effect thereto on a pro forma
basis the Consolidated Fixed Charge Coverage Ratio for the four full quarters
immediately preceding such event, taken as one period, would have been equal to
or greater than 2.5 to 1.0 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 Capital Stock is issued or would occur as a consequence of
the incurrence of the additional Indebtedness or the issuance of the
Disqualified Capital Stock. For purposes of determining compliance with this
Section 6.9(a), in the event that an item of Indebtedness meets the criteria of
one or more of the categories of Permitted Indebtedness described in clauses (i)
through (xi) of such definition or is entitled to be incurred (whether incurred
under the Bank Credit Facility or otherwise) pursuant to the proviso of the
foregoing sentence, the Company may, in its sole discretion, classify such item
of Indebtedness in any manner that complies with this covenant and such item of
Indebtedness will be treated as having been incurred pursuant too only one of
such clauses of the definition of Permitted Indebtedness or the proviso of the
foregoing sentence and an item of Indebtedness may be divided and classified in
more than one of the types of Indebtedness permitted hereunder.
(b) The amount of any guarantee by the Company or any Restricted
Subsidiary of any Indebtedness of the Company or one or more Restricted
Subsidiaries shall not be deemed to be outstanding or incurred for purposes of
this Section 6.9 hereof in addition to the amount of Indebtedness which it
guarantees.
(c) For purposes of this Section 6.9, Indebtedness of any Person that
becomes a Restricted Subsidiary by merger, consolidation or other acquisition
shall be deemed to have been incurred by the Company and the Restricted
Subsidiary at the time such Person becomes a Restricted Subsidiary.
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Section 6.10 Additional Guarantors.
(a) The Company shall cause each Restricted Subsidiary that guarantees the
payment of, assumes or in any other manner becomes liable (whether directly or
indirectly) with respect to any Indebtedness of the Company or any other
Restricted Subsidiary of the Company, including, without limitation,
Indebtedness under the Bank Credit Facility, to execute and deliver an indenture
supplemental to this Supplemental Indenture agreeing to be bound by its terms
applicable to a Guarantor and providing for a Guarantee of the Securities by
such Restricted Subsidiary.
(b) Notwithstanding the foregoing and the other provisions of this
Supplemental Indenture, any Guarantee incurred by a Restricted Subsidiary
pursuant to this Section 6.10 shall provide by its terms that it shall be
automatically and unconditionally released and discharged upon the terms and
conditions set forth in Section 9.3 hereof.
Section 6.11 Limitation on Issuances and Sales of Preferred Stock of
Restricted Subsidiaries.
The Company (a) shall not permit any Restricted Subsidiary to issue or
sell any Preferred Stock to any Person other than to the Company or one of its
Wholly Owned Restricted Subsidiaries and (b) shall not permit any Person other
than the Company or one of its Wholly Owned Restricted Subsidiaries to own any
Preferred Stock of any other Restricted Subsidiary except, in each case, for (i)
the Preferred Stock of a Restricted Subsidiary owned by a Person at the time
such Restricted Subsidiary became a Restricted Subsidiary or acquired by such
Person in connection with the formation of the Restricted Subsidiary, or
transfers thereof or (ii) a sale of Preferred Stock in connection with the sale
of all of the Capital Stock of a Restricted Subsidiary owned by the Company or
its Subsidiaries effected in accordance with Section 6.14 hereof.
Section 6.12 Limitation on Liens.
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume, affirm or suffer to exist or
become effective any Lien of any kind, except for Permitted Liens, upon any of
their respective Properties, whether now owned or acquired after the date of
this Supplemental Indenture, or any income or profits therefrom, or assign or
convey any right to receive income thereon, unless (a) in the case of any Lien
securing Subordinated Indebtedness, the Securities are secured by a lien on such
Property or proceeds that is senior in priority to such Lien and (b) in the case
of any other Lien, the Securities are directly secured equally and ratably with
the obligation or liability secured by such Lien.
Section 6.13 Purchase of Securities Upon Change of Control.
(a) Upon the occurrence of a Change of Control Triggering Event, the
Company shall be obligated to make an offer to purchase (a "Change of Control
Offer") all of the then Outstanding Securities, in whole or in part, from the
Holders of such Securities in integral multiples of $1,000, at a purchase price
(the "Change of Control Purchase Price") equal to 101% of the aggregate
principal amount of such Securities, plus accrued and unpaid interest, if any,
to
52
the Change of Control Purchase Date (as defined below), in accordance with the
procedures set forth in paragraphs (b), (c) and (d) of this Section. The Company
shall, subject to the provisions described below, be required to purchase all
Securities properly tendered into the Change of Control Offer and not withdrawn.
The Company will not be required to make a Change of Control Offer upon a Change
of Control Triggering Event if another Person makes the Change of Control Offer
at the same purchase price, at the same times and otherwise in substantial
compliance with the requirements applicable to a Change of Control Offer to be
made by the Company and purchases all Securities validly tendered and not
withdrawn under such Change of Control Offer.
(b) The Change of Control Offer is required to remain open for at least 20
Business Days and until the close of business on the fifth Business Day prior to
the Change of Control Purchase Date (as defined below).
(c) Not later than the 30th day following any Change of Control Triggering
Event, the Company shall give to the Trustee in the manner provided in Section
10.2 and each Holder of the Securities in the manner provided in Section 10.3, a
notice (the "Change of Control Notice") governing the terms of the Change of
Control Offer and stating:
(1) that a Change in Control Triggering Event has occurred and that
such Holder has the right to require the Company to repurchase such
Holder's Securities, or portion thereof, at the Change of Control Purchase
Price;
(2) any information regarding such Change of Control Triggering
Event required to be furnished pursuant to Rule 13e-1 under the Exchange
Act and any other securities laws and regulations thereunder;
(3) a purchase date (the "Change of Control Purchase Date") which
shall be on a Business Day and no earlier than 30 days nor later than 60
days from the date the Change of Control Triggering Event occurred;
(4) that any Security, or portion thereof, not tendered or accepted
for payment will continue to accrue interest:
(5) that unless the Company defaults in depositing money with the
Paying Agent in accordance with the last paragraph of clause (d) of this
Section 6.13, or payment is otherwise prevented, any Security, or portion
thereof, accepted for payment pursuant to the Change of Control Offer
shall cease to accrue interest after the Change of Control Purchase Date;
and
(6) the instructions a Holder must follow in order to have his
Securities repurchased in accordance with paragraph (d) of this Section.
If any of the Securities subject to the Change of Control Offer is in the form
of a Global Security, then the Company shall modify the Change of Control Notice
to the extent necessary to accord with the procedures of the depository
applicable thereto.
53
(d) Holders electing to have Securities purchased will be required to
surrender such Securities to the Paying Agent at the address specified in the
Change of Control Notice at least five Business Days prior to the Change of
Control Purchase Date. Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than three Business Days prior to the
Change of Control Purchase Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder and principal amount of the
Securities delivered for purchase by the Holder as to which his election is to
be withdrawn and a statement that such Holder is withdrawing his election to
have such Securities purchased. Holders whose Securities are purchased only in
part will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered.
On the Change of Control Purchase Date, the Company shall (i) accept for
payment Securities or portions thereof validly tendered pursuant to a Change of
Control Offer, (ii) deposit with the Paying Agent money sufficient to pay the
purchase price of all Securities or portions thereof so tendered, and (iii)
deliver or cause to be delivered to the Trustee the Securities so accepted. The
Paying Agent shall promptly mail or deliver to Holders of the Securities so
tendered payment in an amount equal to the purchase price for the Securities,
and the Company shall execute and the Trustee shall authenticate and mail or
make available for delivery to such Holders a new Security equal in principal
amount to any unpurchased portion of the Security which any such Holder did not
surrender for purchase. The Company shall announce the results of a Change of
Control Offer on or as soon as practicable after the Change of Control Purchase
Date. For purposes of this Section 6.13, the Trustee will act as the Paying
Agent.
(e) The Company shall comply with 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 the event that a Change of Control Triggering
Event occurs and the Company is required to purchase Securities as described in
this Section 6.13.
Section 6.14 Limitation on Asset Sales.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate any Asset Sale unless (i) the Company or such
Restricted Subsidiary, as the case may be, receives consideration at the time of
such Asset Sale at least equal to the Fair Market Value of the Property subject
to such Asset Sale and (ii) all of the consideration paid to the Company or such
Restricted Subsidiary in connection with such Asset Sale is in the form of cash,
Cash Equivalents, Liquid Securities, Exchanged Properties or the assumption by
the purchaser of liabilities of the Company (other than liabilities of the
Company that are by their terms subordinated to the Securities) or liabilities
of any Guarantor that made such Asset Sale (other than liabilities of a
Guarantor that are by their terms subordinated to such Guarantor's Guarantee),
in each case as a result of which the Company and its remaining Restricted
Subsidiaries are no longer liable for such liabilities ("Permitted
Consideration"); provided, however, that the Company and its Restricted
Subsidiaries shall be permitted to receive Property other than Permitted
Consideration, so long as the aggregate Fair Market Value of all such Property
other than Permitted Consideration received from Asset Sales and held by the
Company or any Restricted Subsidiary at any one time shall not exceed 10% of
Adjusted Consolidated Net
54
Tangible Assets. The Net Available Cash from Asset Sales by the Company or a
Restricted Subsidiary may be applied by the Company or such Restricted
Subsidiary, to the extent the Company or such Restricted Subsidiary elects (or
is required by the terms of any Senior Indebtedness of the Company or a
Restricted Subsidiary), to (i) repay Indebtedness of the Company under the Bank
Credit Facility, (ii) reinvest in Additional Assets (including by means of an
Investment in Additional Assets by a Restricted Subsidiary with Net Available
Cash received by the Company or another Restricted Subsidiary) or (iii) purchase
Securities or purchase both Securities and one or more series or issues of other
Senior Indebtedness on a pro rata basis (excluding Securities and Senior
Indebtedness owned by the Company or an Affiliate of the Company). Pending any
reinvestment pursuant to clause (ii) in the preceding sentence, the Company may
temporarily prepay, repay or purchase Senior Indebtedness of the Company or a
Guarantor.
(b) Any Net Available Cash from an Asset Sale not applied in accordance
with the preceding paragraph within 365 days from the date of such Asset Sale
shall constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds
exceeds $10,000,000, the Company shall be required to make an offer to purchase
Securities having an aggregate principal amount equal to the aggregate amount of
Excess Proceeds (the "Prepayment Offer") at a purchase price equal to 100% of
the principal amount of such Securities plus accrued and unpaid interest, if
any, to the Purchase Date (as defined) in accordance with the procedures
(including prorating in the event of oversubscription) set forth herein. If the
aggregate principal amount of Securities tendered by Holders thereof exceeds the
amount of available Excess Proceeds, then such Excess Proceeds shall be
allocated pro rata according to the principal amount of the Securities tendered
and the Trustee shall select the Securities to be purchased in accordance
herewith. To the extent that any portion of the amount of Excess Proceeds
remains after compliance with the second sentence of this paragraph and provided
that all Holders of Securities have been given the opportunity to tender their
Securities for purchase as described in the following paragraph in accordance
with this Supplemental Indenture, the Company and its Restricted Subsidiaries
may use such remaining amount for purposes permitted by this Supplemental
Indenture and the amount of Excess Proceeds shall be reset to zero.
(c) (1) Within 30 days after the 365th day following the date of an Asset
Sale, the Company shall, if it is obligated to make an offer to purchase the
Securities pursuant to the preceding paragraph, send a written Prepayment Offer
notice, by first-class mail, to the Trustee and the Holders of the Securities
(the "Prepayment Offer Notice"), accompanied by such information regarding the
Company and its Subsidiaries as the Company believes shall enable such Holders
of the Securities to make an informed decision with respect to the Prepayment
Offer (which at a minimum shall include (i) the most recently filed Annual
Report on Form 10-K (including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form 10-Q of the
Company and any Current Report on Form 8-K of the Company filed subsequent to
such Quarterly Report, other than Current Reports describing Asset Sales
otherwise described in the offering materials, or corresponding successor
reports (or, during any time that the Company is not subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, corresponding reports
prepared pursuant to Section 6.6), (ii) a description of material developments
in the Company's business subsequent to the date of the latest of such reports
and (iii) if material, appropriate pro forma financial
55
information). The Prepayment Offer Notice shall state, among other things, (i)
that the Company is offering to purchase Securities pursuant to the provisions
of this Supplemental Indenture, (ii) that any Security (or any portion thereof)
accepted for payment (and duly paid on the Purchase Date) pursuant to the
Prepayment Offer shall cease to accrue interest on the Purchase Date, (iii) that
any Securities (or portions thereof) not properly tendered shall continue to
accrue interest, (iv) the purchase price and purchase date, which shall be,
subject to any contrary requirements of applicable law, no less than 30 days nor
more than 60 days after the date the Prepayment Offer Notice is mailed (the
"Purchase Date"), (v) the aggregate principal amount of Securities to be
purchased, (vi) a description of the procedure which Holders of Securities must
follow in order to tender their Securities and the procedures that Holders of
Securities must follow in order to withdraw an election to tender their
Securities for payment and (vii) all other instructions and materials necessary
to enable Holders to tender Securities pursuant to the Prepayment Offer.
(2) Not later than the date upon which written notice of a
Prepayment Offer is delivered to the Trustee as provided above, the
Company shall deliver to the Trustee an Officers' Certificate as to (i)
the amount of the Prepayment Offer (the "Offer Amount"), (ii) the
allocation of the Net Available Cash from the Asset Sales pursuant to
which such Prepayment Offer is being made and (iii) the compliance of such
allocation with the provisions of Section 6.14(a). On such date, the
Company shall also irrevocably deposit with the Trustee or with the Paying
Agent (or, if the Company is the Paying Agent, shall segregate and hold in
trust) in cash an amount equal to the Offer Amount to be held for payment
in accordance with the provisions of this Section. Upon the expiration of
the period for which the Prepayment Offer remains open (the "Offer
Period"), the Company shall deliver to the Trustee for cancellation the
Securities or portions thereof which have been properly tendered to and
are to be accepted by the Company. The Trustee or the Paying Agent shall,
on the Purchase Date, mail or deliver payment to each tendering Holder in
the amount of the purchase price. In the event that the aggregate purchase
price of the Securities delivered by the Company to the Trustee is less
than the Offer Amount, the Trustee or the Paying Agent shall deliver the
excess to the Company immediately after the expiration of the Offer Period
for application in accordance with this Section.
(3) Holders electing to have a Security purchased shall be required
to surrender the Security, with an appropriate form duly completed, to the
Company or its agent at the address specified in the notice at least three
Business Days prior to the Purchase Date. Holders shall be entitled to
withdraw their election if the Trustee or the Company receives not later
than one Business Day prior to the Purchase Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Security which was delivered for purchase by the
Holder and a statement that such Holder is withdrawing his election to
have such Security purchased. If at the expiration of the Offer Period the
aggregate principal amount of Securities surrendered by Holders exceeds
the Offer Amount, the Company shall select the Securities to be purchased
on a pro rata basis (with such adjustments as may be deemed appropriate by
the Company so that only Securities in denominations of $1,000, or
integral multiples thereof, shall be purchased). Holders whose Securities
are purchased only in part shall be
56
issued new Securities equal in principal amount to the unpurchased portion
of the Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an
Officers' Certificate stating that such Securities are to be accepted by
the Company pursuant to and in accordance with the terms of this Section
6.14. A Security shall be deemed to have been accepted for purchase at the
time the Trustee or the Paying Agent mails or delivers payment therefor to
the surrendering Holder.
(d) The Company shall comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
or regulations thereunder to the extent such laws and regulations are applicable
in connection with the purchase of Securities as described above. To the extent
that the provisions of any securities laws or regulations conflict with the
provisions relating to the Prepayment Offer, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations described above by virtue thereof.
Section 6.15 Limitation on Transactions with Affiliates.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or suffer to exist any
transaction or series of related transactions (including, without limitation,
the sale, purchase, exchange or lease of Property or the rendering of any
services) with, or for the benefit of, any Affiliate of the Company (other than
the Company or a Wholly Owned Restricted Subsidiary), unless (a) such
transaction or series of related transactions is on terms that are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
would be available in a comparable transaction in arm's-length dealings with an
unrelated third party, (b) with respect to a transaction or series of related
transactions involving aggregate payments in excess of $5,000,000, the Company
delivers an Officers' Certificate to the Trustee certifying that such
transaction or series of related transactions complies with clause (a) above and
that such transaction or series of related transactions has been approved by a
majority of the Disinterested Directors of the Company, and (c) with respect to
any one transaction or series of related transactions involving aggregate
payments in excess of $20,000,000, the Officers' Certificate referred to in
clause (b) above also certifies that the Company has obtained a written opinion
from an independent nationally recognized investment banking firm or appraisal
firm specializing or having a specialty in the type and subject matter of the
transaction or series of related transactions at issue, which opinion shall be
to the effect set forth in clause (a) above or shall state that such transaction
or series of related transactions is fair from a financial point of view to the
Company or such Restricted Subsidiary; provided, however, that the foregoing
restriction shall not apply to (i) loans or advances to officers, directors and
employees of the Company or any Restricted Subsidiary made in the ordinary
course of business in an aggregate amount not to exceed $1,000,000 outstanding
at any one time, (ii) indemnities of officers, directors, employees and other
agents of the Company or any Restricted Subsidiary permitted by corporate
charter or other organizational document, bylaw or statutory provisions, (iii)
the payment of reasonable and customary fees to directors of the Company or any
of its Restricted Subsidiaries who are not employees of the Company or any
Affiliate, (iv) the
57
Company's employee compensation and other benefit arrangements, (v) transactions
exclusively between or among the Company and any of the Restricted Subsidiaries
or exclusively between or among such Restricted Subsidiaries, provided such
transactions are not otherwise prohibited by this Supplemental Indenture, and
(vi) any Restricted Payment permitted to be paid pursuant Section 6.7.
Section 6.16 Limitation on Dividends and Other Payment Restrictions
Affecting Restricted Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, create or suffer to exist or allow to become effective
any consensual encumbrance or restriction of any kind on the ability of any
Restricted Subsidiary to (a) pay dividends, in cash or otherwise, or make any
other distributions on or in respect of its Capital Stock, or make payments on
any Indebtedness owed, to the Company or any other Restricted Subsidiary, (b) to
make loans or advances to the Company or any other Restricted Subsidiary or (c)
to transfer any of its Property to the Company or any other Restricted
Subsidiary (any such restrictions being collectively referred to herein as a
"Payment Restriction"), except for such encumbrances or restrictions existing
under or by reason of (i) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of the Company or any
Restricted Subsidiary, or customary restrictions in licenses relating to the
Property covered thereby and entered into in the ordinary course of business,
(ii) any instrument governing Indebtedness of a Person acquired by the Company
or any Restricted Subsidiary at the time of such acquisition, which encumbrance
or restriction is not applicable to any other Person, other than the Person, or
the Property of the Person, so acquired, provided that such Indebtedness was not
incurred in anticipation of such acquisition, (iii) any instrument governing
Indebtedness or Disqualified Capital Stock of a Restricted Subsidiary that is
not a Guarantor, provided that such Indebtedness or Disqualified Capital Stock
is permitted under Section 6.9 or (iv) the Bank Credit Facility as in effect on
the date of this Supplemental Indenture or any agreement that amends, modifies,
supplements, restates, extends, renews, refinances or replaces the Bank Credit
Facility, provided that the terms and conditions of any Payment Restriction
thereunder are not materially less favorable to the Holders of the Securities
than those under the Bank Credit Facility as in effect on the date of this
Supplemental Indenture.
Section 6.17 Limitation on Sale and Leaseback Transactions.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any Sale/Leaseback Transaction unless (i) the
Company or such Restricted Subsidiary, as the case may be, would be able to
incur Indebtedness in an amount equal to the Attributable Indebtedness with
respect to such Sale/Leaseback Transaction or (ii) the Company or such
Restricted Subsidiary receives proceeds from such Sale/Leaseback Transaction at
least equal to the fair market value thereof (as determined in good faith by the
Company's Board of Directors, whose determination in good faith, evidenced by a
resolution of such Board shall be conclusive) and such proceeds are applied in
the same manner and to the same extent as Net Available Cash and Excess Proceeds
from an Asset Sale.
58
Section 6.18 Covenant Suspension.
Following any day (a "Suspension Date") that (a) the Securities have a
rating equal to or higher than BBB- by S&P and a rating equal to or higher than
Baa3 by ▇▇▇▇▇'▇ ("Investment Grade Ratings"), (b) follows a date on which the
Securities do not have Investment Grade Ratings, and (c) no Default or Event of
Default has occurred and is continuing under this Supplemental Indenture, the
Company and its Restricted Subsidiaries shall not be subject to the covenants
described in Sections 4.1(c), 6.7, 6.8, 6.9, 6.14 and 6.15 (collectively, the
"Suspended Covenants"). In the event that the Company and its Restricted
Subsidiaries are not subject to the Suspended Covenants for any period of time
as a result of the preceding sentence, and on any subsequent date the Securities
fail to have Investment Grade Ratings, or a Default or Event of Default occurs
and is continuing, then immediately after such date (a "Reversion Date"), the
Suspended Covenants will again be in effect with respect to future events,
unless and until a subsequent Suspension Date occurs. The period between a
Suspension Date and a Reversion Date is referred to in this Supplemental
Indenture as a "Suspension Period." Notwithstanding that the Suspended Covenants
may be reinstated, no Default or Event of Default will be deemed to have
occurred as a result of a failure to comply with the Suspended Covenants during
any Suspension Period. Calculations made after the Reversion Date of the amount
available to be made as Restricted Payments under Section 6.7 will be made as
though the covenants described under Section 6.7 had been in effect since the
Issue Date and throughout the Suspension Period.
ARTICLE VII.
REDEMPTION OF SECURITIES
Section 7.1 Notice to Trustee.
If the Company elects to redeem Securities pursuant to paragraph 5 of the
Securities, it shall notify the Trustee in writing of the redemption date, the
principal amount of Securities to be redeemed and that such redemption is being
made pursuant to paragraph 5 of the Securities.
The Company shall give each notice to the Trustee provided for in this
Section at least 60 days before the Redemption Date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Company to the effect that such
redemption will comply with the conditions herein. Any election to redeem
Securities shall be revocable until the Company gives a notice of redemption
pursuant to Section 7.2 to the Holders of Securities to be redeemed.
Section 7.2 Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not less than 30 days nor more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities not previously called for redemption, pro rata, by lot or by any
other method as the Trustee shall deem fair and appropriate and which may
provide for the selection for redemption of portions of the principal of
Securities; provided, however, that any such partial redemption shall be in
integral multiples of $1,000.
59
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption and, in the case of any Securities selected for partial
redemption, the principal amount thereof to be redeemed.
For all purposes of this Supplemental Indenture, unless the context
otherwise requires, all provisions relating to redemption of Securities shall
relate, in the case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has been or is to be
redeemed.
Section 7.3 Notice of Redemption.
Notice of redemption shall be given in the manner provided for in Section
10.3 hereof not less than 30 nor more than 60 days prior to the Redemption Date,
to each Holder of Securities to be redeemed.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities are to be redeemed, the
identification (and, in the case of a partial redemption, the principal amounts)
of the particular Securities to be redeemed;
(d) that on the Redemption Date the Redemption Price (together with
accrued interest, if any, to the Redemption Date payable as provided in Section
7.5 hereof) will become due and payable upon each such Security, or the portion
thereof, to be redeemed, and that, unless the Company shall default in the
payment of the Redemption Price and any applicable accrued interest, interest
thereon will cease to accrue on and after said date; and
(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company. Failure to give such
notice by mailing to any Holder of Securities or any defect therein shall not
affect the validity of any proceedings for the redemption of other Securities.
Section 7.4 Deposit of Redemption Price.
On or before 10:00 a.m., Eastern time, on any Redemption Date, the Company
shall deposit with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as provided in
Section 10.3 of the Base Indenture) an amount
60
of money sufficient to pay the Redemption Price of, and accrued and unpaid
interest on, all the Securities which are to be redeemed on such Redemption
Date.
Section 7.5 Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified (together with accrued and unpaid interest,
if any, to the Redemption Date), and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued and
unpaid interest) such Securities shall cease to bear interest. Upon surrender of
any such Security for redemption in accordance with said notice, such Security
shall be paid by the Company at the Redemption Price, together with accrued and
unpaid interest, if any, to the Redemption Date.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal (and premium, if any) shall, until paid,
bear interest from the Redemption Date at the rate borne by the Securities.
Section 7.6 Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered at
the office or agency of the Company maintained for such purpose pursuant to
Section 6.2 hereof (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security without
service charge, a new Security or Securities, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in exchange
for the unredeemed portion of the principal amount of the Security so
surrendered.
ARTICLE VIII.
DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1 Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may, at its option by Board Resolution, at any time, with
respect to the Securities, elect to have either Section 8.2 or Section 8.3
hereof be applied to all Outstanding Securities upon compliance with the
conditions set forth below in this Article VIII.
Section 8.2 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 Guarantors shall be deemed
to have been discharged from their respective obligations with respect to all
Outstanding Securities on the date the conditions set forth in Section 8.4
hereof are satisfied (hereinafter, "legal defeasance"). For this purpose,
61
such legal defeasance means that the Company and the Guarantors shall be deemed
(i) to have paid and discharged their respective obligations under the
Outstanding Securities; provided, however, that the Securities shall continue to
be deemed to be "Outstanding" for purposes of Section 8.5 hereof and the other
Sections of this Supplemental Indenture referred to in clauses (A) and (B)
below, and (ii) to have satisfied all their other obligations with respect to
such Securities and this Supplemental Indenture (and the Trustee, at the expense
and direction of the Company, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (A) the rights of Holders of Outstanding Securities to
receive, solely from the trust fund described in Section 8.4 hereof and as more
fully set forth in such Section, payments in respect of the principal of (and
premium if any, on) and interest on such Securities when such payments are due
(or at such time as the Securities would be subject to redemption at the option
of the Company in accordance with this Supplemental Indenture), (B) the
respective obligations of the Company and the Guarantors under Sections 2.3,
2.4, 2.5, 2.6, 2.7, 2.8, 2.9, 3.8, 3.14, 6.2, 9.1 (to the extent it relates to
the foregoing Sections and this Article VIII), 9.4 and 9.5 hereof, (C) the
rights, powers, trusts, duties and immunities of the Trustee hereunder, and (D)
the obligations of the Company and the Guarantors under this Article VIII.
Subject to compliance with this Article VIII, the Company may exercise its
option under this Section 8.2 notwithstanding the prior exercise of its option
under Section 8.3 hereof with respect to the Securities.
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 each Guarantor shall be released
from their respective obligations under any covenant contained in Article IV, in
Sections 6.4 through 6.17 and in Section 9.2 hereof with respect to the
Outstanding Securities on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant defeasance"), and the Securities shall
thereafter be deemed not to be "Outstanding" for the purposes of any 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. For this purpose, such covenant
defeasance means that, with respect to the Outstanding Securities, the Company
and each Guarantor 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 3.1(c) or
3.1(d) hereof, but, except as specified above, the remainder of this
Supplemental Indenture and such Securities shall be unaffected thereby.
Section 8.4 Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Section 8.2
or Section 8.3 hereof to the Outstanding Securities:
(a) The Company or any Guarantor shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee satisfying the
requirements of Article VI of the
62
Base Indenture who shall agree to comply with the provisions of this Article
VIII applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Securities, (A) cash in United States
dollars in an amount, or (B) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to pay
and discharge, and which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, the principal of (and premium, if any, on) and
interest on the Outstanding Securities on the Stated Maturity thereof (or
Redemption Date, if applicable), provided that the Trustee shall have been
irrevocably instructed in writing by the Company to apply such money or the
proceeds of such U.S. Government Obligations to said payments with respect to
the Securities. Before such a deposit, the Company may give to the Trustee, in
accordance with Section 7.1 hereof, a notice of its election to redeem all of
the Outstanding Securities at a future date in accordance with Article VII
hereof, which notice shall be irrevocable. Such irrevocable redemption notice,
if given, shall be given effect in applying the foregoing. For this purpose,
"U.S. Government Obligations" means securities that are (x) direct obligations
of the United States of America for the timely payment of which its full faith
and credit is pledged or (y) 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 U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depository receipt, provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment of principal
of or interest on the U.S. Government Obligation evidenced by such depository
receipt.
(b) No Default or Event of Default with respect to the Securities shall
have occurred and be continuing on the date of such deposit or, insofar as
Sections 3.1(h) and 3.1(i) are concerned, at any time during the period ending
on the 91st day after the date of such deposit.
(c) Such legal defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest under this Supplemental Indenture or the
Trust Indenture Act with respect to any securities of the Company or any
Guarantor.
(d) Such legal defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under, any other material
agreement or instrument to which the Company or any Guarantor is a party or by
which it is bound, as evidenced to the Trustee in an Officers' Certificate
delivered to the Trustee concurrently with such deposit.
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(e) In the case of an election under Section 8.2 hereof, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (i) the Company
has received from, or there has been published by, the Internal Revenue Service
a ruling, or (ii) since the date of this Supplemental Indenture there has been a
change in the applicable federal income tax laws, in either case providing that
the Holders of the Outstanding Securities 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 (it being understood that (x) such Opinion of Counsel shall also
state that such ruling or applicable law is consistent with the conclusions
reached in such Opinion of Counsel and (y) the Trustee shall be under no
obligation to investigate the basis or correctness of such ruling).
(f) In the case of an election under Section 8.3 hereof, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of the Outstanding Securities 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.
(g) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, which, taken together, state that all
conditions precedent provided for relating to either the legal defeasance under
Section 8.2 hereof or the covenant defeasance under Section 8.3 (as the case may
be) have been complied with.
Section 8.5 Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 10.3 of the
Base Indenture, all money and U.S. Government Obligations (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 Securities shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Securities and this Supplemental Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Holders of such Securities of all sums due
and to become due thereon in respect of principal (and premium, if any) and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against all taxes, fees or
other charges imposed on or assessed against the U.S. Governmental Obligations
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 Securities.
Anything in this Article VIII to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 8.4
hereof which, in the opinion of a nationally
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recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
legal defeasance or covenant defeasance, as applicable, in accordance with this
Article.
Section 8.6 Reinstatement.
If the Trustee or any Paying Agent is unable to apply any money in
accordance with Section 8.5 hereof by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's and the Guarantors' obligations under this
Supplemental Indenture and the Securities 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, until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with Section 8.5 hereof; provided, however,
that if the Company or any Guarantor makes any payment of principal of (or
premium, if any, on) or interest on any Security following the reinstatement of
its obligations, the Company or such Guarantor shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the money held by
the Trustee or Paying Agent.
ARTICLE IX.
GUARANTEES
Section 9.1 Unconditional Guarantee.
Each Guarantor hereby unconditionally, jointly and severally, guarantees
(each such guarantee being referred to herein as this "Guarantee," with all such
guarantees being referred to herein as the "Guarantees") to each Holder of
Securities authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, the full and prompt performance of the Company's
obligations under the Indenture and the Securities and that:
(a) the principal of (and premium, if any, on) and interest on the
Securities will 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 the Securities, if any, to the extent lawful, and all other
obligations of the Company to the Holders or the Trustee hereunder or thereunder
will 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
Securities or of any such other obligations, the same will 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; subject,
however, in the case of clauses (a) and (b) above, to the limitations set forth
in Section 9.4 hereof.
Failing payment when due of any amount so guaranteed or any performance so
guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the
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same immediately. Each Guarantor hereby agrees that its obligations hereunder
shall, to the extent permitted by law, be unconditional, irrespective of the
validity, regularity or enforceability of the Securities or the Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Securities 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 Guarantor hereby waives, to the extent permitted by
law, 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 covenants that its Guarantee will not be discharged except by complete
performance of the obligations contained in the Securities, the Indenture and in
this Guarantee. If any Holder or the Trustee is required by any court or
otherwise to return to the Company, any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Company or any
Guarantor, any amount paid by the Company or any Guarantor to the Trustee or
such Holder, this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor agrees it shall not be
entitled to enforce any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby. Each Guarantor further agrees that, as between
each Guarantor, 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 III hereof 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 acceleration of such obligations as provided in Article III hereof,
such obligations (whether or not due and payable) shall forthwith become due and
payable by each Guarantor for the purpose of this Guarantee.
Section 9.2 Guarantors May Consolidate, etc., on Certain Terms.
(a) Except as set forth in Article IV hereof, nothing contained in this
Supplemental Indenture or in any of the Securities shall prevent any
consolidation or merger of a Guarantor with or into the Company or another
Guarantor or shall prevent any sale, conveyance or other disposition of all or
substantially all the Properties of a Guarantor to the Company or another
Guarantor.
(b) Except as set forth in Article IV hereof, nothing contained in this
Supplemental Indenture or in any of the Securities shall prevent any
consolidation or merger of a Guarantor with or into a Person other than the
Company or another Guarantor (whether or not Affiliated with the Guarantor), or
successive consolidations or mergers in which a Guarantor or its successor or
successors shall be a party or parties, or shall prevent any sale, conveyance or
other disposition of all or substantially all the Properties of a Guarantor to a
Person other than the Company or another Guarantor (whether or not Affiliated
with the Guarantor) authorized to acquire and operate the same; provided,
however, that (i) immediately after such transaction, and giving effect thereto,
no Default or Event of Default shall have occurred as a result of such
transaction and be continuing, (ii) such transaction shall not violate any of
the covenants of Sections 6.1 through 6.17 hereof, and (iii) each Guarantor
hereby covenants and agrees that, upon any such consolidation, merger, sale,
conveyance or other disposition, such Guarantor's
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Guarantee set forth in this Article IX, and the due and punctual performance and
observance of all of the covenants and conditions of this Supplemental Indenture
to be performed by such Guarantor, shall be expressly assumed (in the event that
the Guarantor is not the surviving corporation in a merger), by supplemental
indenture satisfactory in form to the Trustee, executed and delivered to the
Trustee, by such Person formed by such consolidation, or into which the
Guarantor shall have merged, or by the Person that shall have acquired such
Property (except to the extent the following Section 9.3 would result in the
release of such Guarantee, in which case such surviving Person or transferee of
such Property shall not have to execute any such supplemental indenture and
shall not have to assume such Guarantor's Guarantee). In the case of any such
consolidation, merger, sale, conveyance or other disposition and upon the
assumption by the successor Person, by supplemental indenture executed and
delivered to the Trustee and satisfactory in form to the Trustee of the due and
punctual performance of all of the covenants and conditions of this Supplemental
Indenture to be performed by the Guarantor, such successor Person shall succeed
to and be substituted for the Guarantor with the same effect as if it had been
named herein as the initial Guarantor.
Section 9.3 Release of Guarantors.
Upon the sale or disposition (by merger or otherwise) of a Guarantor (or
all or substantially all of its Properties) to a Person other than the Company
or another Guarantor and pursuant to a transaction that is otherwise in
compliance with the terms of this Supplemental Indenture, including but not
limited to the provisions of Section 9.2 hereof or pursuant to Article IV
hereof, such Guarantor shall be deemed released from its Guarantee and all
related obligations under this Supplemental Indenture; provided, however, that
any such release shall occur only to the extent that all obligations of such
Guarantor under all of its guarantees of, and under all of its pledges of assets
or other security interests which secure, other Indebtedness of the Company or
any other Restricted Subsidiary shall also be released upon such sale or other
disposition. The Trustee shall deliver an appropriate instrument evidencing such
release upon receipt of a Company Request accompanied by an Officers'
Certificate and an Opinion of Counsel certifying that such sale or other
disposition was made by the Company in accordance with the provisions of this
Supplemental Indenture. In addition, in the event that any Guarantor ceases to
guarantee payment of, or in any other manner to remain liable (whether directly
or indirectly) with respect to any and all other Indebtedness of the Company or
any other Restricted Subsidiary of the Company, including, without limitation,
Indebtedness under the Bank Credit Facility, such Guarantor shall also be
released from its Guarantee and the related obligations under this Supplemental
Indenture for so long as it remains not liable with respect to all such other
Indebtedness. The Trustee shall deliver an appropriate instrument evidencing
such release upon receipt of a Company Request accompanied by an Officers'
Certificate and an Opinion of Counsel certifying that such Guarantor has ceased
to guarantee or otherwise be liable with respect to such other Indebtedness of
the Company and the other Restricted Subsidiaries. Each Guarantor that is
designated as an Unrestricted Subsidiary in accordance with the provisions of
this Supplemental Indenture shall be released from its Guarantee and all related
obligations under this Supplemental Indenture for so long as it remains an
Unrestricted Subsidiary. The Trustee shall deliver an appropriate instrument
evidencing such release upon its receipt of the Board Resolution designating
such Unrestricted Subsidiary. Any Guarantor not released in
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accordance with this Section 9.3 shall remain liable for the full amount of
principal of (and premium, if any, on) and interest on the Securities as
provided in this Article IX.
Section 9.4 Limitation of Guarantors' Liability.
Each Guarantor, and by its acceptance hereof each Holder, hereby confirm
that it is the intention of all such parties that the guarantee by such
Guarantor pursuant to its Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Federal Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or
state law. To effectuate the foregoing intention, the Holders and each Guarantor
hereby irrevocably agree that the obligations of such Guarantor under its
Guarantee shall be limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of such Guarantor and after giving
effect to any collections from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under its
Guarantee or pursuant to Section 9.5 hereof, result in the obligations of such
Guarantor under its Guarantee not constituting such a fraudulent conveyance or
fraudulent transfer. This Section 9.4 is for the benefit of the creditors of
each Guarantor.
Section 9.5 Contribution.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under its
Guarantee, such Funding Guarantor shall be entitled to a contribution from each
other Guarantor (if any) in a pro rata amount based on the Adjusted Net Assets
of each Guarantor (including the Funding Guarantor) for all payments, damages
and expenses incurred by that Funding Guarantor in discharging the Company's
obligations with respect to the Securities or any other Guarantor's obligations
with respect to its Guarantee.
Section 9.6 Severability.
In case any provision of this Guarantee shall be invalid, illegal or
unenforceable, that portion of such provision that is not invalid, illegal or
unenforceable shall remain in effect, and the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
ARTICLE X.
MISCELLANEOUS
Section 10.1 Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Supplemental Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agents duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are
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delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Supplemental Indenture and conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The ownership, principal amount and serial numbers of Securities held
by any Person, and the date of holding the same, shall be proved by the Security
Register.
(d) If the Company shall solicit from the Holders of Securities any
request, demand, authorization, direction, notice, consent, waiver or other Act,
the Company may, at its option, by or pursuant to a Board Resolution, fix in
advance a record date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. Notwithstanding TIA Section
316(c), such record date shall be the record date specified in or pursuant to
such Board Resolution, which shall be a date not earlier than the date 30 days
prior to the first solicitation of Holders generally in connection therewith and
not later than the date such solicitation is completed. If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act may be given before or after such record date, but only the Holders
of record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or other
Act, and for that purpose the Outstanding Securities shall be computed as of
such record date, provided that no such authorization, agreement or consent by
the Holders on such record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Supplemental Indenture not later
than eleven months after the record date.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
69
Section 10.2 Notices, etc. to Trustee, Company and Guarantors.
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Supplemental
Indenture to be made upon, given or furnished to or filed with,
(1) the Trustee by any Holder, the Company, any Guarantor or any holder of
Senior Indebtedness shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing (in the English language) and delivered in
person or mailed by certified or registered mail (return receipt requested) to
the Trustee at its Corporate Trust Office; or
(2) the Company or any Guarantor by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing (in the English language) and delivered in person or
mailed by certified or registered mail (return receipt requested) to the Company
or such Guarantor, as applicable, addressed to it at the Company's offices
located at ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Attention: Chief Financial Officer, or at any other address otherwise furnished
in writing to the Trustee by the Company.
Section 10.3 Notice to Holders; Waiver.
Where this Supplemental Indenture provides for notice of any event to
Holders by the Company or the Trustee, such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing (in the English
language) and mailed, first-class postage prepaid, to each Holder affected by
such event, at his address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed,
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Any notice mailed to a Holder in the manner herein
prescribed shall be conclusively deemed to have been received by such Holder,
whether or not such Holder actually receives such notice. Where this
Supplemental Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of or irregularities in regular mail
service or by reason of any other cause, it shall be impracticable to mail
notice of any event to Holders when such notice is required to be given pursuant
to any provision of this Supplemental Indenture, then any manner of giving such
notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice for every purpose hereunder.
70
Section 10.4 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 10.5 Successors and Assigns.
All covenants and agreements in this Supplemental Indenture by the Company
and the Guarantors shall bind their respective successors and assigns, whether
so expressed or not. All agreements of the Trustee in this Supplemental
Indenture shall bind its successor.
Section 10.6 Severability.
In case any provision in this Supplemental Indenture or in the Securities
or the Guarantees 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, and a Holder shall have no claim therefor against
any party hereto.
Section 10.7 Benefits of Supplemental Indenture.
Nothing in this Supplemental Indenture or in the Securities, express or
implied, shall give to any Person (other than the parties hereto, any Paying
Agent, any Registrar and their successors hereunder, the Holders and, to the
extent set forth in Section 9.4 hereof, creditors of Guarantors and the holders
of Senior Indebtedness) any benefit or any legal or equitable right, remedy or
claim under this Supplemental Indenture.
Section 10.8 Governing Law; Trust Indenture Act Controls.
(a) THIS SUPPLEMENTAL INDENTURE, THE GUARANTEES AND THE SECURITIES SHALL
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. THE COMPANY AND EACH GUARANTOR
IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN, THE CITY OF
NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
SUPPLEMENTAL INDENTURE, THE SECURITIES OR THE GUARANTEES, AND THE COMPANY AND
EACH GUARANTOR IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED BY ANY SUCH COURT.
(b) The Indenture is subject to the provisions of the Trust Indenture Act
that are required to be part of the Indenture and shall, to the extent
applicable, be governed by such provisions. If and to the extent that any
provision of this Supplemental Indenture limits, qualifies or conflicts with the
duties imposed by operation of Section 318(c) of the Trust
71
Indenture Act, or conflicts with any provision (an "incorporated provision")
required by or deemed to be included in the Indenture by operation of such Trust
Indenture Act section, such imposed duties or incorporated provision shall
control.
Section 10.9 No Recourse Against Others.
A director, officer, employee, stockholder, incorporator or Affiliate, as
such, past, present or future, of the Company or any Guarantor shall not have
any personal liability under the Securities or this Supplemental Indenture by
reason of his or its status as a director, officer, employee, stockholder,
incorporator or Affiliate or any liability for any obligations of the Company or
any Guarantor under the Securities or this Supplemental Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Holder, by accepting any of the Securities, waives and releases
all such liability to the extent permitted by applicable law.
Section 10.10 Duplicate Originals.
The parties may sign any number of copies or counterparts of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
Section 10.11 Conflict with Base Indenture.
This Supplemental Indenture constitutes a supplemental indenture in
respect of the Base Indenture, to the extent related to the Securities, and to
the extent specifically related to the Securities this Supplemental Indenture
supersedes the Base Indenture to the extent inconsistent therewith. In the event
of any conflict between the provisions of this Supplemental Indenture and the
provisions of the Base Indenture, the provisions of this Supplemental Indenture
shall control. For avoidance of doubt, (a) Articles V, VIII, X, XI, XIII and XIV
of the Base Indenture are, solely with respect to the Securities, superseded and
replaced in their entirety by Articles IV, V, VII, VIII, IX and X of this
Supplemental Indenture, respectively, and (b) Article XV of the Base Indenture
shall be inapplicable in its entirety to the Securities.
Section 10.12 No Adverse Interpretation of Other Agreements.
This Supplemental Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or any of its Subsidiaries. Any
such indenture, loan or debt agreement may not be used to interpret this
Supplemental Indenture.
[Remainder of Page Intentionally Left Blank; Signature Pages Follow.]
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, all as of the day and year first above written.
ISSUER:
▇▇▇▇▇▇▇▇ RESOURCES, INC.
By: /s/ M. ▇▇▇ ▇▇▇▇▇▇▇
------------------
Name: M. ▇▇▇ ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
GUARANTORS:
▇▇▇▇▇▇▇▇ OIL & GAS, INC.
By: /s/ M. ▇▇▇ ▇▇▇▇▇▇▇
------------------
Name: M. ▇▇▇ ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
▇▇▇▇▇▇▇▇ OIL & GAS-LOUISIANA, LLC
By: /s/ M. ▇▇▇ ▇▇▇▇▇▇▇
------------------
Name: M. ▇▇▇ ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
▇▇▇▇▇▇▇▇ OFFSHORE, LLC
By: /s/ M. ▇▇▇ ▇▇▇▇▇▇▇
------------------
Name: M. ▇▇▇ ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
▇▇▇▇▇▇▇▇ OIL & GAS HOLDINGS, INC.
By: /s/ M. ▇▇▇ ▇▇▇▇▇▇▇
------------------
Name: M. ▇▇▇ ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
TRUSTEE:
THE BANK OF NEW YORK TRUST COMPANY, N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
