FERRELLGAS, L.P.
----------------
NOTE PURCHASE AGREEMENT
----------------
DATED AS OF JULY 1, 1998
Re: $109,000,000 6.99% Senior Notes, Series A, due
August 1, 2005 $37,000,000 7.08% Senior Notes,
Series B, due August 1, 2006 $52,000,000 7.12%
Senior Notes, Series C, due August 1, 2008
$82,000,000 7.24% Senior Notes, Series D, due
August 1, 2010 $70,000,000 7.42% Senior Notes,
Series E, due August 1, 2013
TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. AUTHORIZATION OF NOTES................................................................................1
SECTION 2. SALE AND PURCHASE OF NOTES............................................................................1
SECTION 3. CLOSING...............................................................................................2
SECTION 4. CONDITIONS TO CLOSING.................................................................................2
Section 4.1. Representations and Warranties....................................................................2
Section 4.2. Performance; No Default...........................................................................2
Section 4.3. Compliance Certificates...........................................................................3
Section 4.4. Opinions of Counsel...............................................................................3
Section 4.5. Purchase Permitted by Applicable Law, Etc.........................................................3
Section 4.6. Related Transactions..............................................................................4
Section 4.7. Payment of Special Counsel Fees...................................................................4
Section 4.8. Private Placement Numbers.........................................................................4
Section 4.9. Changes in Structure..............................................................................4
Section 4.10. Redemption of Senior Notes........................................................................4
Section 4.11. Rating............................................................................................4
Section 4.12. Proceedings and Documents.........................................................................4
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.........................................................4
Section 5.1. Organization; Power and Authority; Ownership......................................................4
Section 5.2. Authorization, Etc................................................................................5
Section 5.3. Disclosure........................................................................................5
Section 5.4. Organization and Ownership of Shares of Subsidiaries..............................................5
Section 5.5. Financial Statements..............................................................................6
Section 5.6. Compliance with Laws, Other Instruments, Etc......................................................6
Section 5.7. Governmental Authorizations, Etc..................................................................7
Section 5.8. Litigation; Observance of Agreements, Statutes and Orders.........................................7
Section 5.9. Taxes.............................................................................................7
Section 5.10. Title to Property; Leases.........................................................................7
Section 5.11. Licenses, Permits, Etc............................................................................8
Section 5.12. Compliance with ERISA.............................................................................8
Section 5.13. Private Offering by the Company...................................................................9
Section 5.14. Use of Proceeds; Margin Regulations...............................................................9
Section 5.15. Existing Indebtedness; Future Liens...............................................................9
Section 5.16. Foreign Assets Control Regulations, Etc..........................................................10
Section 5.17. Status under Certain Statutes....................................................................10
Section 5.18. Environmental Matters............................................................................10
SECTION 6. REPRESENTATIONS OF THE PURCHASER.....................................................................11
Section 6.1. Purchase for Investment..........................................................................11
Section 6.2. Source of Funds..................................................................................11
SECTION 7. INFORMATION AS TO COMPANY............................................................................12
Section 7.1. Financial and Business Information...............................................................12
Section 7.2. Officer's Certificate............................................................................15
Section 7.3. Inspection.......................................................................................15
Section 7.4. Change in Status of Subsidiaries.................................................................16
SECTION 8. PREPAYMENT OF THE NOTES..............................................................................16
Section 8.1. Prepayments......................................................................................16
Section 8.2. Optional Prepayments with Make-Whole Amount......................................................16
Section 8.3. Allocation of Partial Prepayments................................................................17
Section 8.4. Maturity; Surrender, Etc.........................................................................17
Section 8.5. Purchase of Notes................................................................................17
Section 8.6. Make-Whole Amount................................................................................17
SECTION 9. AFFIRMATIVE COVENANTS................................................................................19
Section 9.1. Compliance with Law..............................................................................19
Section 9.2. Insurance........................................................................................19
Section 9.3. Maintenance of Properties........................................................................19
Section 9.4. Payment of Taxes.................................................................................20
Section 9.5. Partnership Existence, Etc.......................................................................20
Section 9.6. Ranking..........................................................................................20
SECTION 10. NEGATIVE COVENANTS...................................................................................20
Section 10.1. Incurrence of Debt...............................................................................20
Section 10.2. Guaranty of MLP Notes............................................................................22
Section 10.3. Restricted Subsidiary Debt.......................................................................23
Section 10.4. Liens............................................................................................23
Section 10.5. Restricted Payments..............................................................................25
Section 10.6. Restrictions on Dividends of Subsidiaries, Etc...................................................26
Section 10.7. Mergers and Consolidations.......................................................................26
Section 10.8. Sale of Assets; Sale of Stock....................................................................27
Section 10.9. Nature of Business...............................................................................29
Section 10.10. Transactions with Affiliates.....................................................................29
Section 10.11. Certain Refinancings.............................................................................29
SECTION 11. EVENTS OF DEFAULT....................................................................................29
SECTION 12. REMEDIES ON DEFAULT, ETC.............................................................................32
Section 12.1. Acceleration.....................................................................................32
Section 12.2. Other Remedies...................................................................................32
Section 12.3. Rescission.......................................................................................32
Section 12.4. No Waivers or Election of Remedies, Expenses, Etc................................................33
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES........................................................33
Section 13.1. Registration of Notes............................................................................33
Section 13.2. Transfer and Exchange of Notes...................................................................33
Section 13.3. Replacement of Notes.............................................................................34
SECTION 14. PAYMENTS ON NOTES....................................................................................34
Section 14.1. Place of Payment.................................................................................34
Section 14.2. Home Office Payment..............................................................................34
SECTION 15. EXPENSES, ETC........................................................................................35
Section 15.1. Transaction Expenses.............................................................................35
Section 15.2. Survival.........................................................................................35
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.........................................36
SECTION 17. AMENDMENT AND WAIVER.................................................................................36
Section 17.1. Requirements.....................................................................................36
Section 17.2. Solicitation of Holders of Notes.................................................................36
Section 17.3. Binding Effect, Etc..............................................................................37
Section 17.4. Notes Held by Company, Etc.......................................................................37
SECTION 18. NOTICES..............................................................................................37
SECTION 19. REPRODUCTION OF DOCUMENTS............................................................................38
SECTION 20. CONFIDENTIAL INFORMATION.............................................................................38
SECTION 21. SUBSTITUTION OF PURCHASER............................................................................39
SECTION 22. MISCELLANEOUS........................................................................................39
Section 22.1. Successors and Assigns...........................................................................39
Section 22.2. Payments Due on Non-Business Days................................................................39
Section 22.3. Severability.....................................................................................40
Section 22.4. Construction.....................................................................................40
Section 22.5. Counterparts.....................................................................................40
Section 22.6. Governing Law....................................................................................40
Signatures......................................................................................................................40
SCHEDULE A -- INFORMATION RELATING TO PURCHASERS
SCHEDULE B -- DEFINED TERMS
SCHEDULE 5.1 -- Ownership of Company
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of
Subsidiary Equity Interest
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.11 -- Patents, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness and Liens
EXHIBIT 1-A -- Form of Series A Note
EXHIBIT 1-B -- Form of Series B Note
EXHIBIT 1-C -- Form of Series C Note
EXHIBIT 1-D -- Form of Series D Note
EXHIBIT 1-E -- Form of Series E Note
EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel for the
Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel for the
Purchasers
EXHIBIT 10.1 -- Subordination Provisions Applicable to
Subordinated Debt
FERRELLGAS, L.P.
One Liberty Plaza
Liberty, Missouri 64068
$109,000,000 6.99% Senior Notes, Series A, due August
1, 2005 $37,000,000 7.08% Senior Notes, Series B, due
August 1, 2006 $52,000,000 7.12% Senior Notes, Series
C, due August 1, 2008 $82,000,000 7.24% Senior Notes,
Series D, due August 1, 2010 $70,000,000 7.42% Senior
Notes, Series E, due August 1, 2013
Dated as of
July 1, 1998
TO EACH OF THE PURCHASERS LISTED IN THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
FERRELLGAS, L.P., a Delaware limited partnership (the "Company"),
agrees with the Purchasers listed in the attached Schedule A as follows:
SECTION 1. AUTHORIZATION OF NOTES.
The Company will authorize the issue and sale of $350,000,000 aggregate
principal amount of its Senior Notes, comprised of $109,000,000 6.99% Senior
Notes, Series A, due August 1, 2005 (the "Series A Notes"), $37,000,000 7.08%
Senior Notes, Series B, due August 1, 2006 (the "Series B Notes"), $52,000,000
7.12% Senior Notes, Series C, due August 1, 2008 (the "Series C Notes"),
$82,000,000 7.24% Senior Notes, Series D, due August 1, 2010 (the "Series D
Notes"), and $70,000,000 7.42% Senior Notes, Series E, due August 1, 2013 (the
"Series E Notes") (said Series A Notes, Series B Notes, Series C Notes, Series D
Notes and Series E Notes being herein collectively called the "Notes", such term
to include any such notes issued in substitution therefor pursuant to Section 13
of this Agreement (as hereinafter defined)). The Series A, B, C, D and E Notes
shall be substantially in the respective forms set out in Exhibit 1, in each
case with such changes therefrom, if any, as may be approved by each Purchaser
and the Company. Certain capitalized terms used in this Agreement are defined in
Schedule B; references to a "Schedule" or an "Exhibit" are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.
SECTION 2. SALE AND PURCHASE OF NOTES.
Subject to the terms and conditions of this Agreement, the Company will
issue and sell to each Purchaser and each Purchaser will purchase from the
Company, at the Closing provided for in Section 3, Notes in the principal amount
and of the series specified opposite such Purchaser's name in Schedule A at the
purchase price of 100% of the principal amount thereof. The obligations of each
Purchaser hereunder are several and not joint obligations and each Purchaser
shall have no obligation and no liability to any Person for the performance or
nonperformance by any other Purchaser hereunder.
SECTION 3. CLOSING.
The sale and purchase of the Notes to be purchased by each Purchaser
shall occur at the offices of Chapman and Cutler, 111 West Monroe Street,
Chicago, Illinois 60603 at 10:00 A.M. Chicago time, at a closing (the "Closing")
on such Business Day prior to August 15, 1998 as may be designated by at least
five Business Days' prior written notice to the Purchasers. At the Closing the
Company will deliver to each Purchaser the Notes of any such series to be
purchased by such Purchaser in the form of a single Note of each series to be
purchased by such Purchaser (or such greater number of Notes of any such series
in denominations of at least $100,000 as such Purchaser may request) dated the
date of the Closing and registered in such Purchaser's name (or in the name of
such Purchaser's nominee), against delivery by such Purchaser to the Company or
its order of immediately available funds in the amount of the purchase price
therefor by wire transfer of immediately available funds for the account of the
Company to Norwest Bank Minnesota, as cashiering agent, at such trust account
number as shall be designated by the Company in the notice of Closing referred
to above. If at the Closing the Company shall fail to tender such Notes to any
Purchaser as provided above in this Section 3, or any of the conditions
specified in Section 4 shall not have been fulfilled to any Purchaser's
satisfaction, such Purchaser shall, at such Purchaser's election, be relieved of
all further obligations under this Agreement, without thereby waiving any rights
such Purchaser may have by reason of such failure or such nonfulfillment.
SECTION 4. CONDITIONS TO CLOSING.
The obligation of each Purchaser to purchase and pay for the Notes to
be sold to such Purchaser at the Closing is subject to the fulfillment to such
Purchaser's satisfaction, prior to or at the Closing, of the following
conditions:
Section 4.1.Representations and Warranties. The representations and warranties
of the Company in this Agreement shall be correct when made and at the time of
the Closing.
Section 4.2.Performance; No Default. The Company shall have performed and
complied with all agreements and conditions contained in this Agreement required
to be performed or complied with by it prior to or at the Closing, and after
giving effect to the issue and sale of the Notes (and the application of the
proceeds thereof as contemplated by Schedule 5.14), no Default or Event of
Default shall have occurred and be continuing. Neither the Company nor any
Subsidiary shall have entered into any transaction since the date of the
Memorandum that would have been prohibited by Section 10 hereof had such Section
applied since such date.
Section 4.3.Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered
to such Purchaser an Officer's Certificate, dated the date of the
Closing, certifying that the conditions specified in Sections 4.1, 4.2
and 4.9 have been fulfilled.
(b) Secretary's Certificate. The General Partner shall have
delivered to such Purchaser a certificate certifying as to the
resolutions attached thereto and other proceedings relating to the
authorization, execution and delivery of the Notes and this Agreement.
(c) ERISA Certificate. If such Purchaser shall have made the
disclosures referred to in Section 6.2(b), (c) or (e), such Purchaser
shall have received the certificate from the Company described in the
last paragraph of Section 6.2 and such certificate shall state that (i)
the Company is neither a "party in interest" nor a "disqualified
person" (as defined in Section 4975(e)(2) of the Code), with respect to
any plan identified pursuant to Section 6.2(b) or (e) or (ii) with
respect to any plan, identified pursuant to Section 6.2(c), neither the
Company nor any "affiliate" (as defined in Section V(c) of the QPAM
Exemption) has, at such time or during the immediately preceding one
year, exercised the authority to appoint or terminate the QPAM as
manager of the assets of any plan identified in writing pursuant to
Section 6.2(c) or to negotiate the terms of said QPAM's management
agreement on behalf of any such identified plans.
Section 4.4.Opinions of Counsel. Such Purchaser shall have received opinions in
form and substance satisfactory to such Purchaser, dated the date of the Closing
(a) from Bryan Cave LLP, special counsel for the Company, covering the matters
set forth in Exhibit 4.4(a) and covering such other matters incident to the
transactions contemplated hereby as such Purchaser or such Purchaser's counsel
may reasonably request (and the Company hereby instructs its counsel to deliver
such opinion to such Purchaser) and (b) from Chapman and Cutler, the Purchasers'
special counsel in connection with such transactions, substantially in the form
set forth in Exhibit 4.4(b) and covering such other matters incident to such
transactions as such Purchaser may reasonably request.
Section 4.5.Purchase Permitted by Applicable Law, Etc. On the date of the
Closing each purchase of Notes shall (a) be permitted by the laws and
regulations of each jurisdiction to which each Purchaser is subject, without
recourse to provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject any
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation, which law or regulation was not in effect on the date hereof.
If requested by any Purchaser, such Purchaser shall have received an Officer's
Certificate certifying as to such matters of fact as such Purchaser may
reasonably specify to enable such Purchaser to determine whether such purchase
is so permitted.
Section 4.6.Related Transactions. The Company shall have consummated the sale of
the entire principal amount of the Notes scheduled to be sold on the Closing
Date pursuant to this Agreement.
Section 4.7.Payment of Special Counsel Fees. Without limiting the provisions of
Section 15.1, the Company shall have paid on or before the Closing the fees,
charges and disbursements of the Purchasers' special counsel referred to in
Section 4.4 to the extent reflected in a statement of such counsel rendered to
the Company at least one Business Day prior to the Closing.
Section 4.8.Private Placement Numbers. A Private Placement Number issued by
Standard & Poor's CUSIP Service Bureau (in cooperation with the Securities
Valuation Office of the National Association of Insurance Commissioners) shall
have been obtained for each series of the Notes.
Section 4.9.Changes in Structure. The Company shall not have changed its
jurisdiction of organization or been a party to any merger or consolidation and
shall not have succeeded to all or any substantial part of the liabilities of
any other entity, at any time following the date of the most recent financial
statements referred to in Schedule 5.5.
Section 4.10.Redemption of Senior Notes. The Company shall have given notice of
redemption of the entire principal amount of the Senior Notes issued and
outstanding under the Indenture dated as of July 5, 1994 (the "Indenture")
between the Company, Ferrellgas Finance Corp. and Norwest Bank Minnesota,
National Association (the "Trustee") in accordance with the terms thereof, which
redemption shall be made on the first Business Day following the date of
Closing; and concurrently with the issuance and sale of the Notes hereunder, the
Company shall irrevocably deposit with the Trustee an amount sufficient for the
redemption of such Senior Notes on such Business Day.
Section 4.11.Rating. Prior to the date of Closing, the Notes shall have received
a rating of "BBB" or better from Fitch IBCA, Inc.
Section 4.12.Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be satisfactory to such Purchaser and such
Purchaser's special counsel, and such Purchaser and such Purchaser's special
counsel shall have received all such counterpart originals or certified or other
copies of such documents as such Purchaser or such Purchaser's special counsel
may reasonably request.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Purchaser that:
Section 5.1.Organization; Power and Authority; Ownership. The Company is a
limited partnership duly organized, validly existing and in good standing under
the laws of the State of Delaware, and is duly licensed or qualified as a
foreign partnership and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The Company
has the power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement and the Notes and to
perform the provisions hereof and thereof. The name of each Person holding an
equity interest in the Company (including a description of the nature of such
interest) is set forth on Schedule 5.1.
Section 5.2.Authorization, Etc. This Agreement and the Notes have been duly
authorized by all necessary action on the part of the Company, and this
Agreement constitutes, and upon execution and delivery thereof each Note will
constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as such enforceability
may be limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally and (ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
Section 5.3.Disclosure. The Company, through its agent, BancAmerica Robertson
Stephens, has delivered to each Purchaser a copy of a Private Placement
Memorandum, dated May, 1998 (the "Memorandum"), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects,
the general nature of the business and principal properties of the Company and
its Restricted Subsidiaries. Except as disclosed in Schedule 5.3, this
Agreement, the Memorandum, the documents, certificates or other writings
delivered to each Purchaser by or on behalf of the Company in connection with
the transactions contemplated hereby and the financial statements listed in
Schedule 5.5, taken as a whole, do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under which they
were made. Except as disclosed in the Memorandum or as expressly described in
Schedule 5.3, or in one of the documents, certificates or other writings
identified therein, or in the financial statements listed in Schedule 5.5, since
July 31, 1997, there has been no change in the financial condition, operations,
business, properties or prospects of the Company or any of its Restricted
Subsidiaries except changes that individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect. There is no fact known
to the Company that could reasonably be expected to have a Material Adverse
Effect that has not been set forth herein or in the Memorandum or in the other
documents, certificates and other writings delivered to each Purchaser by or on
behalf of the Company specifically for use in connection with the transactions
contemplated hereby.
Section 5.4.Organization and Ownership of Shares of Subsidiaries; Affiliates.
(a) Schedule 5.4 contains (except as noted therein) complete and correct lists
(i) of the Company's Subsidiaries, showing, as to each Subsidiary, its status
(whether a Restricted or Unrestricted Subsidiary), the correct name thereof, the
jurisdiction of its organization, and the percentage of shares of each class of
its capital stock or similar equity interests outstanding owned by the Company
and each other Subsidiary, (ii) of the Company's Affiliates, other than
Subsidiaries, and (iii) of the Company's directors and senior officers.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Restricted Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and is duly
qualified as a foreign corporation or other legal entity and is in good standing
in each jurisdiction in which such qualification is required by law, other than
those jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect. Each such Restricted Subsidiary has the
corporate or other power and authority to own or hold under lease the properties
it purports to own or hold under lease and to transact the business it transacts
and proposes to transact.
(d) No Restricted Subsidiary is a party to, or otherwise subject to,
any legal restriction or any agreement (other than this Agreement, the
agreements listed on Schedule 5.4 and customary limitations imposed by corporate
law statutes) restricting the ability of such Restricted Subsidiary to pay
dividends out of profits or make any other similar distributions of profits to
the Company or any of its Restricted Subsidiaries that owns outstanding shares
of capital stock or similar equity interests of such Restricted Subsidiary.
Section 5.5.Financial Statements. The Company has delivered to each Purchaser
copies of the financial statements of the Company and its Restricted
Subsidiaries listed on Schedule 5.5. All of said financial statements (including
in each case the related schedules and notes) fairly present in all material
respects the consolidated financial position of the Company and its Restricted
Subsidiaries as of the respective dates specified in such financial statements
and the consolidated results of their operations and cash flows for the
respective periods so specified and have been prepared in accordance with GAAP
consistently applied throughout the periods involved except as set forth in the
notes thereto (subject, in the case of any interim financial statements, to
normal year-end adjustments).
Section 5.6.Compliance with Laws, Other Instruments, Etc. The execution,
delivery and performance by the Company of this Agreement and the Notes will not
(a) contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of the Company or
any Restricted Subsidiary under, any indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease, partnership agreement, corporate charter or
by-laws, or any other agreement or instrument to which the Company or any
Restricted Subsidiary is bound or by which the Company or any Restricted
Subsidiary or any of their respective properties may be bound or affected, (b)
conflict with or result in a breach of any of the terms, conditions or
provisions of any Material order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any Restricted
Subsidiary or (c) violate any provision of any Material statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Restricted Subsidiary.
Section 5.7.Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement or the Notes.
Section 5.8.Litigation; Observance of Agreements, Statutes and Orders. (a)
Except as disclosed in Schedule 5.8, there are no actions, suits or proceedings
pending or, to the knowledge of the Company, threatened against or affecting the
Company or any Restricted Subsidiary or any property of the Company or any
Restricted Subsidiary in any court or before any arbitrator of any kind or
before or by any Governmental Authority that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Restricted Subsidiary is in default
under any term of any agreement or instrument to which it is a party or by which
it is bound, or any order, judgment, decree or ruling of any court, arbitrator
or Governmental Authority or is in violation of any applicable law, ordinance,
rule or regulation (including without limitation Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
Section 5.9.Taxes. The Company and its Restricted Subsidiaries have filed all
tax returns that are required to have been filed in any jurisdiction, and have
paid all taxes shown to be due and payable on such returns and all other taxes
and assessments levied upon them or their properties, assets, income or
franchises, to the extent such taxes and assessments have become due and payable
and before they have become delinquent, except for any taxes and assessments (a)
the amount of which is not individually or in the aggregate Material or (b) the
amount, applicability or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which the Company or a
Restricted Subsidiary, as the case may be, has established adequate reserves in
accordance with GAAP. The Company knows of no basis for any other tax or
assessment that could reasonably be expected to have a Material Adverse Effect.
The charges, accruals and reserves on the books of the Company and its
Restricted Subsidiaries in respect of Federal, state or other taxes for all
fiscal periods are adequate.
Section 5.10.Title to Property; Leases. The Company and its Restricted
Subsidiaries have good and sufficient title to their respective properties that
individually or in the aggregate are Material, including all such properties
reflected in the most recent audited balance sheet referred to in Section 5.5 or
purported to have been acquired by the Company or any Restricted Subsidiary
after said date (except as sold or otherwise disposed of in the ordinary course
of business), in each case free and clear of Liens that individually or in the
aggregate would have a Material Adverse Effect. All leases that individually or
in the aggregate are Material are valid and subsisting and are in full force and
effect in all material respects.
Section 5.11.Licenses, Permits, Etc. Except as disclosed in Schedule 5.11,
(a) the Company and its Restricted Subsidiaries own or
possess all licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or rights
thereto, that individually or in the aggregate are Material, without
known conflict with the rights of others;
(b) to the best knowledge of the Company, no product of the
Company or any of its Restricted Subsidiaries infringes in any material
respect any license, permit, franchise, authorization, patent,
copyright, service mark, trademark, trade name or other right owned by
any other Person; and
(c) to the best knowledge of the Company, there is no
Material violation by any Person of any right of the Company or any of
its Restricted Subsidiaries with respect to any patent, copyright,
service mark, trademark, trade name or other right owned or used by the
Company or any of its Restricted Subsidiaries.
Section 5.12.Compliance with ERISA. (a) The Company and each ERISA Affiliate
have operated and administered each Plan in compliance with all applicable laws
except for such instances of noncompliance as have not resulted in and could not
reasonably be expected to result in a Material Adverse Effect. Neither the
Company nor any ERISA Affiliate has incurred any liability pursuant to Title I
or IV of ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans (as defined in Section 3 of ERISA), and no event,
transaction or condition has occurred or exists that could reasonably be
expected to result in the incurrence of any such liability by the Company or any
ERISA Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in either case
pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions
or to Section 401(a)(29) or 412 of the Code, other than such liabilities or
Liens as would not be individually or in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end of such
Plan's most recently ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent actuarial valuation
report, did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has the
meaning specified in Section 4001 of ERISA and the terms "current value" and
"present value" have the meanings specified in Section 3 of ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
Section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(d) The expected post-retirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by Section 4980B of
the Code) of the Company and its Restricted Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of Section 406 of ERISA or in connection with which a tax could
be imposed pursuant to Section 4975(c)(1)(A)-(D) of the Code. The representation
by the Company in the first sentence of this Section 5.12(e) is made in reliance
upon and subject to the accuracy of each Purchaser's representation in Section
6.2 as to the sources of the funds to be used to pay the purchase price of the
Notes to be purchased by such Purchaser.
Section 5.13.Private Offering by the Company. Neither the Company nor anyone
acting on its behalf has offered the Notes or any similar securities for sale
to, or solicited any offer to buy any of the same from, or otherwise approached
or negotiated in respect thereof with, any Person other than the Purchasers and
not more than 55 other institutional investors, each of which has been offered
the Notes at a private sale for investment. Neither the Company nor anyone
acting on its behalf has taken, or will take, any action that would subject the
issuance or sale of the Notes to the registration requirements of Section 5 of
the Securities Act.
Section 5.14.Use of Proceeds; Margin Regulations. The Company will apply the
proceeds of the sale of the Notes as set forth in Schedule 5.14. No part of the
proceeds from the sale of the Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Company in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 0% of the value of the consolidated assets of the Company
and its Restricted Subsidiaries and the Company does not have any present
intention that margin stock will constitute more than 0% of the value of such
assets. As used in this Section, the terms "margin stock" and "purpose of buying
or carrying" shall have the meanings assigned to them in said Regulation U.
Section 5.15.Existing Indebtedness; Future Liens. (a) Schedule 5.15 sets forth a
complete and correct list of all outstanding Indebtedness of the Company and its
Restricted Subsidiaries as of June 30, 1998, since which date there has been no
Material change in the amounts, interest rates, sinking funds, installment
payments or maturities of the Indebtedness of the Company or its Restricted
Subsidiaries. Neither the Company nor any Restricted Subsidiary is in default
and no waiver of default is currently in effect, in the payment of any principal
or interest on any Indebtedness of the Company or such Restricted Subsidiary and
no event or condition exists with respect to any Indebtedness of the Company or
any Restricted Subsidiary that would permit (or that with notice or the lapse of
time, or both, would permit) one or more Persons to cause such Indebtedness to
become due and payable before its stated maturity or before its regularly
scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor any
Restricted Subsidiary has agreed or consented to cause or permit in the future
(upon the happening of a contingency or otherwise) any of its property, whether
now owned or hereafter acquired, to be subject to a Lien not permitted by
Section 10.4.
Section 5.16.Foreign Assets Control Regulations, Etc. Neither the sale of the
Notes by the Company hereunder nor its use of the proceeds thereof will violate
the Trading with the Enemy Act, as amended, or any of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) or any enabling legislation or executive order relating
thereto.
Section 5.17.Status under Certain Statutes. Neither the Company nor any
Restricted Subsidiary is an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or is subject
to regulation under the Public Utility Holding Company Act of 1935, as amended,
the ICC Termination Act of 1995, as amended, or the Federal Power Act, as
amended.
Section 5.18.Environmental Matters. Neither the Company nor any Restricted
Subsidiary has knowledge of any claim or has received any notice of any claim,
and no proceeding has been instituted raising any claim against the Company or
any of its Restricted Subsidiaries or any of their respective real properties
now or formerly owned, leased or operated by any of them or other assets,
alleging any damage to the environment or violation of any Environmental Laws,
except, in each case, such as could not reasonably be expected to result in a
Material Adverse Effect. Except as otherwise disclosed to each Purchaser in
writing:
(a) neither the Company nor any Restricted Subsidiary has
knowledge of any facts which would give rise to any claim, public or
private, of violation of Environmental Laws or damage to the
environment emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of them or
to other assets or their use, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect;
(b) neither the Company nor any of its Restricted
Subsidiaries has stored any Hazardous Materials on real properties now
or formerly owned, leased or operated by any of them or has disposed of
any Hazardous Materials in a manner contrary to any Environmental Laws
in each case in any manner that could reasonably be expected to result
in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or
operated by the Company or any of its Restricted Subsidiaries are in
compliance with applicable Environmental Laws, except where failure to
comply could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 6. REPRESENTATIONS OF THE PURCHASER.
Section 6.1.Purchase for Investment. Each Purchaser represents that (a) it is
purchasing the Notes for its own account or for one or more separate accounts
maintained by it or for the account of one or more pension or trust funds and
not with a view to the distribution thereof, provided that the disposition of
such Purchaser's or such pension or trust funds' property shall at all times be
within such Purchaser's or such pension or trust funds' control, and (b) it is
an "accredited investor" within the meaning of Rule 501 of Regulation D of the
Securities Act. Each Purchaser understands that the Notes have not been
registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Notes.
Section 6.2.Source of Funds. Each Purchaser represents that at least one of the
following statements is an accurate representation as to each source of funds (a
"Source") to be used by it to pay the purchase price of the Notes to be
purchased by it hereunder:
(a) the Source is an "insurance company general account"
within the meaning of Department of Labor Prohibited Transaction
Exemption ("PTE") 95-60 (issued July 12, 1995) and there is no employee
benefit plan, treating as a single plan, all plans maintained by the
same employer or employee organization, with respect to which the
amount of the general account reserves and liabilities for all
contracts held by or on behalf of such plan, exceeds ten percent (10%)
of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set forth
in the NAIC Annual Statement for such Purchaser most recently filed
with such Purchaser's state of domicile; or
(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTE 90-1 (issued January 29,
1990), or (ii) a bank collective investment fund, within the meaning of
the PTE 91-38 (issued July 12, 1991) and, except as such Purchaser has
disclosed to the Company in writing pursuant to this paragraph (b), no
employee benefit plan or group of plans maintained by the same employer
or employee organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(c) the Source constitutes assets of an "investment fund"
(within the meaning of Part V of the QPAM Exemption) managed by a
"qualified professional asset manager" or "QPAM" (within the meaning of
Part V of the QPAM Exemption), no employee benefit plan's assets that
are included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee
organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the
QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in
Section V(e) of the QPAM Exemption) owns a 5% or more interest in the
Company and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant to this
paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee
benefit plans, each of which has been identified to the Company in
writing pursuant to this paragraph (e);
(f) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA; or
(g) the Source is an insurance company separate account
maintained solely in connection with the fixed contractual obligations
of the insurance company under which the amounts payable, or credited,
to any employee benefit plan (or its related trust) and to any
participant or beneficiary of such plan (including any annuitant) are
not affected in any manner by the investment performance of the
separate account.
If any Purchaser or any subsequent transferee of the Notes indicates that such
Purchaser or such transferee is relying on any representation contained in
paragraph (b), (c) or (e) above, the Company shall deliver on the date of
Closing or on the date of transfer, as applicable, a certificate, which shall
state whether (i) it is a party in interest or a "disqualified person" (as
defined in Section 4975(e)(2) of the Code), with respect to any plan identified
pursuant to paragraphs (b) or (e) above, or (ii) with respect to any plan,
identified pursuant to paragraph (c) above, whether it or any "affiliate" (as
defined in Section V(c) of the QPAM Exemption) has at such time, and during the
immediately preceding one year, exercised the authority to appoint or terminate
said QPAM as manager of any plan identified in writing pursuant to paragraph (c)
above or to negotiate the terms of said QPAM's management agreement on behalf of
any such identified plan. As used in this Section 6.2, the terms "employee
benefit plan", "governmental plan", "party in interest" and "separate account"
shall have the respective meanings assigned to such terms in Section 3 of ERISA.
SECTION 7. INFORMATION AS TO COMPANY; STATUS OF SUBSIDIARIES.
Section 7.1.Financial and Business Information. The Company shall deliver to
each holder of Notes that is an Institutional Investor:
(a) Quarterly Statements -- within 60 days after the end of
each quarterly fiscal period in each fiscal year of the Company (other
than the last quarterly fiscal period of each such fiscal year),
duplicate copies of,
(i) an unaudited consolidated balance sheet
of the Company and its Restricted
Subsidiaries as at the end of such quarter, and
(ii) unaudited consolidated statements of income,
changes in partners' equity and cash flows of the Company and
its Restricted Subsidiaries, for such quarter and (in the case
of the second and third quarters) for the portion of the
fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly
financial statements generally, and certified by a Senior Financial
Officer as fairly presenting, in all material respects, the financial
position of the companies being reported on and their results of
operations and cash flows, subject to changes resulting from normal,
recurring year-end adjustments, provided that delivery within the time
period specified above of copies of the Company's Quarterly Report on
Form 10-Q prepared in compliance with the requirements therefor and
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this Section 7.1(a);
(b) Annual Statements -- within 120 days after the end
of each fiscal year of the Company,
duplicate copies of,
(i) a consolidated balance sheet of the Company
and its Restricted Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes
in partners' equity and cash flows of the Company and its Restricted
Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail, prepared in accordance
with GAAP, and accompanied by
(A) an opinion thereon of independent certified
public accountants of recognized national standing, which
opinion shall state that such financial statements present
fairly, in all material respects, the financial position of
the companies being reported upon and their results of
operations and cash flows and have been prepared in conformity
with GAAP, and that the examination of such accountants in
connection with such financial statements has been made in
accordance with generally accepted auditing standards, and
that such audit provides a reasonable basis for such opinion
in the circumstances, and
(B) a certificate of such accountants stating that
they have reviewed this Agreement and stating further whether,
in making their audit, they have become aware of any condition
or event that then constitutes a Default or an Event of
Default, and, if they are aware that any such condition or
event then exists, specifying the nature and period of the
existence thereof (it being understood that such accountants
shall not be liable, directly or indirectly, for any failure
to obtain knowledge of any Default or Event of Default unless
such accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted auditing
standards or did not make such an audit),
provided that the delivery within the time period specified above of
the Company's Annual Report on Form 10-K for such fiscal year (together
with the Company's annual report to shareholders, if any, prepared
pursuant to Rule 14a-3 under the Exchange Act) prepared in accordance
with the requirements therefor and filed with the Securities and
Exchange Commission, together with the accountant's certificate
described in clause (B) above, shall be deemed to satisfy the
requirements of this Section 7.1(b);
(c) SEC and Other Reports -- promptly upon their becoming
available, one copy of each regular or periodic report, each
registration statement (without exhibits except as expressly requested
by such holder), and each prospectus and all amendments thereto filed
by the Company or any Restricted Subsidiary with the Securities and
Exchange Commission and of all press releases and other statements made
available generally by the Company or any Restricted Subsidiary to the
public concerning developments that are Material;
(d) Notice of Default or Event of Default -- promptly, and in
any event within five Business Days after a Responsible Officer
becoming aware of the existence of any Default or Event of Default or
that any Person has given any notice or taken any action with respect
to a claimed default hereunder or that any Person has given any notice
or taken any action with respect to a claimed default of the type
referred to in Section 11(f), a written notice specifying the nature
and period of existence thereof and what action the Company is taking
or proposes to take with respect thereto;
(e) ERISA Matters -- promptly, and in any event within five
Business Days after a Responsible Officer becoming aware of any of the
following, a written notice setting forth the nature thereof and the
action, if any, that the Company or an ERISA Affiliate proposes to take
with respect thereto:
(i) with respect to any Plan, any reportable event,
as defined in section 4043(b) of ERISA and the regulations
thereunder, for which notice thereof has not been waived
pursuant to such regulations as in effect on the date hereof;
or
(ii) the taking by the PBGC of steps to institute, or
the threatening by the PBGC of the institution of, proceedings
under section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from
a Multiemployer Plan that such action has been taken by the
PBGC with respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could
result in the incurrence of any liability by the Company or
any ERISA Affiliate pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any
ERISA Affiliate pursuant to Title I or IV of ERISA or such
penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then
existing, could reasonably be expected to have a Material
Adverse Effect;
(f) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice to
the Company or any Restricted Subsidiary from any Federal or state
Governmental Authority relating to any order, ruling, statute or other
law or regulation that could reasonably be expected to have a Material
Adverse Effect; and
(g) Requested Information -- with reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company or
any of its Restricted Subsidiaries or relating to the ability of the
Company to perform its obligations hereunder and under the Notes as
from time to time may be reasonably requested by any such holder of
Notes.
Section 7.2.Officer's Certificate. Each set of financial statements delivered to
a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b) hereof shall be
accompanied by a certificate of a Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether the
Company was in compliance with the requirements of Section 10.1 through
Section 10.8 hereof, inclusive, during the quarterly or annual period
covered by the statements then being furnished (including with respect
to each such Section, where applicable, the calculations of the maximum
or minimum amount, ratio or percentage, as the case may be, permissible
under the terms of such Sections, and the calculation of the amount,
ratio or percentage then in existence); and
(b) Event of Default -- a statement that such officer has
reviewed the relevant terms hereof and has made, or caused to be made,
under his or her supervision, a review of the transactions and
conditions of the Company and its Restricted Subsidiaries from the
beginning of the quarterly or annual period covered by the statements
then being furnished to the date of the certificate and that such
review shall not have disclosed the existence during such period of any
condition or event that constitutes a Default or an Event of Default
or, if any such condition or event existed or exists (including,
without limitation, any such event or condition resulting from the
failure of the Company or any Restricted Subsidiary to comply with any
Environmental Law), specifying the nature and period of existence
thereof and what action the Company shall have taken or proposes to
take with respect thereto.
Section 7.3.Inspection. The Company shall permit the representatives of each
holder of Notes that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice
to the Company, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and its
Restricted Subsidiaries with the Company's officers, and (with the
consent of the Company, which consent will not be unreasonably
withheld) its independent public accountants, and (with the consent of
the Company, which consent will not be unreasonably withheld) to visit
the other offices and properties of the Company and each Restricted
Subsidiary, all at such reasonable times and as often as may be
reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists,
at the expense of the Company, to visit and inspect any of the offices
or properties of the Company or any Restricted Subsidiary, to examine
all their respective books of account, records, reports and other
papers, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective
officers and independent public accountants (and by this provision the
Company authorizes said accountants to discuss the affairs, finances
and accounts of the Company and its Restricted Subsidiaries), all at
such times and as often as may be requested.
Section 7.4.Change in Status of Subsidiaries. (a) So long as no Default or Event
of Default shall have occurred and be continuing, the Company may at any time
and from time to time, upon not less than 30 days' prior written notice given to
each Holder, designate a previously Restricted Subsidiary as an Unrestricted
Subsidiary or a previously Unrestricted Subsidiary (including a new Subsidiary
designated on the date of its formation or acquisition) which satisfies the
requirements of clauses (i), (ii) and (iii) of the definition of "Restricted
Subsidiary" as a Restricted Subsidiary, provided that immediately after such
designation and after giving effect thereto no Default or Event of Default shall
have occurred and be continuing, and provided further that after such
designation the status of such Subsidiary had not been changed more than twice.
(b) Any notice of designation pursuant to this Section 7.4 shall be
accompanied by a certificate signed by a Responsible Officer of the Company
stating that the provisions of this Section 7.4 have been complied with in
connection with such designation and setting forth the name of each other
Subsidiary (if any) which has or will become a Restricted Subsidiary or an
Unrestricted Subsidiary, as the case may be, as a result of such designation.
SECTION 8. PREPAYMENT OF THE NOTES.
Section 8.1.Prepayments. The entire outstanding principal amount of the Series A
Notes shall be due on August 1, 2005, the entire outstanding principal amount of
the Series B Notes shall be due on August 1, 2006, the entire outstanding
principal amount of the Series C Notes shall be due on August 1, 2008, the
entire outstanding principal amount of the Series D Notes shall be due on August
1, 2010, and the entire outstanding principal amount of the Series E Notes shall
be due on August 1, 2013. Except as set forth in Section 8.2, the Notes may not
be prepaid prior to maturity at the option of the Company.
Section 8.2.Optional Prepayments with Make-Whole Amount. The Company may, at its
option, upon notice as provided below, prepay at any time all, or from time to
time any part of, the Notes of any series, in an amount not less than $5,000,000
in the case of a partial prepayment of any series, at 100% of the principal
amount so prepaid, together with interest accrued thereon to the date of such
prepayment, plus the Make-Whole Amount determined for the prepayment date with
respect to such principal amount. The Company will give each holder of Notes of
any series being prepaid written notice of each optional prepayment under this
Section 8.2 not less than 30 days and not more than 60 days prior to the date
fixed for such prepayment. Each such notice shall specify such date, the
aggregate principal amount of the Notes of such series to be prepaid on such
date, the principal amount of each Note of such series held by such holder to be
prepaid (determined in accordance with Section 8.3), and the interest to be paid
on the prepayment date with respect to such principal amount being prepaid, and
shall be accompanied by a certificate of a Senior Financial Officer as to the
estimated Make-Whole Amount due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
the details of such computation. Two Business Days prior to such prepayment, the
Company shall deliver to each holder of Notes a certificate of a Senior
Financial Officer specifying the calculation of such Make-Whole Amount as of the
specified prepayment date.
Section 8.3.Allocation of Partial Prepayments. In the case of each partial
prepayment of the Notes of any series, the principal amount of the Notes of such
series to be prepaid shall be allocated among all of the Notes of such series at
the time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof not theretofore called for prepayment.
Section 8.4.Maturity; Surrender, Etc. In the case of each prepayment of Notes of
any series pursuant to this Section 8, the principal amount of each Note of such
series to be prepaid shall mature and become due and payable on the date fixed
for such prepayment, together with interest on such principal amount accrued to
such date and the applicable Make-Whole Amount, if any. From and after such
date, unless the Company shall fail to pay such principal amount when so due and
payable, together with the interest and Make-Whole Amount, if any, as aforesaid,
interest on such principal amount shall cease to accrue. Any Note paid or
prepaid in full shall be surrendered to the Company and cancelled and shall not
be reissued, and no Note shall be issued in lieu of any prepaid principal amount
of any Note.
Section 8.5.Purchase of Notes. The Company will not and will not permit any
Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except upon the payment or prepayment
of the Notes in accordance with the terms of this Agreement, and the Notes. The
Company will promptly cancel all Notes acquired by it or any Affiliate pursuant
to any payment, prepayment or purchase of Notes pursuant to any provision of
this Agreement and no Notes may be issued in substitution or exchange for any
such Notes.
Section 8.6.Make-Whole Amount. The term "Make-Whole Amount" means, with respect
to any Note, an amount equal to the excess, if any, of the Discounted Value of
the Remaining Scheduled Payments with respect to the Called Principal of such
Note over the amount of such Called Principal, provided that the Make-Whole
Amount may in no event be less than zero. For the purposes of determining the
Make-Whole Amount, the following terms have the following meanings:
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
"Discounted Value" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which
interest on the Notes is payable) equal to the Reinvestment Yield with
respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, 0.50% over the yield to maturity implied by (i)
the yields reported, as of 10:00 A.M. (New York City time) on the
second Business Day preceding the Settlement Date with respect to such
Called Principal, on the display designated as "Page 500" on the
Telerate Access Service (or such other display as may replace Page 500
on the Telerate Access Service) for actively traded U.S. Treasury
securities having a maturity equal to the Remaining Average Life of
such Called Principal as of such Settlement Date, or (ii) if such
yields are not reported as of such time or the yields reported as of
such time are not ascertainable, the Treasury Constant Maturity Series
Yields reported, for the latest day for which such yields have been so
reported as of the second Business Day preceding the Settlement Date
with respect to such Called Principal, in Federal Reserve Statistical
Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity
equal to the Remaining Average Life of such Called Principal as of such
Settlement Date. Such implied yield will be determined, if necessary,
by (a) converting U.S. Treasury bill quotations to bond-equivalent
yields in accordance with accepted financial practice and (b)
interpolating linearly between (1) the actively traded U.S. Treasury
security with the maturity closest to and greater than the Remaining
Average Life and (2) the actively traded U.S. Treasury security with
the maturity closest to and less than the Remaining Average Life.
"Remaining Average Life" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the sum
of the products obtained by multiplying (a) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (b) the number of years (calculated to the nearest one-twelfth year)
that will elapse between the Settlement Date with respect to such
Called Principal and the scheduled due date of such Remaining Scheduled
Payment.
"Remaining Scheduled Payments" means, with respect to the
Called Principal of any Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called Principal
were made prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are due to be
made under the terms of the Notes, then the amount of the next
succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on
such Settlement Date pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to Section 8.2 or has become or is declared to be immediately
due and payable pursuant to Section 12.1, as the context requires.
SECTION 9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 9.1.Compliance with Law. The Company will, and will cause each of its
Subsidiaries to, comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
Section 9.2.Insurance. The Company will, and will cause each of its Restricted
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated and consistent with the existing practice of the Company
and its Restricted Subsidiaries as of the date hereof.
Section 9.3.Maintenance of Properties. The Company will, and will cause each of
its Restricted Subsidiaries to, maintain and keep, or cause to be maintained and
kept, their respective properties in good repair, working order and condition
(other than ordinary wear and tear), so that the business carried on in
connection therewith may be properly conducted at all times, provided that this
Section shall not prevent the Company or any Restricted Subsidiary from
discontinuing the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 9.4.Payment of Taxes. The Company will, and will cause each of its
Subsidiaries to, file all tax returns required to be filed in any jurisdiction
and to pay and discharge all taxes shown to be due and payable on such returns
and all other taxes, assessments, governmental charges, or levies imposed on
them or any of their properties, assets, income or franchises, to the extent
such taxes and assessments have become due and payable and before they have
become delinquent and all claims for which sums have become due and payable that
have or might become a Lien on properties or assets of the Company or any
Subsidiary, provided that neither the Company nor any Subsidiary need pay any
such tax or assessment or claims if (i) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (ii) the nonpayment of all such taxes and
assessments in the aggregate could not reasonably be expected to have a Material
Adverse Effect.
Section 9.5.Partnership Existence, Etc. The Company will at all times preserve
its existence and its status as a partnership and keep in full force and effect
its partnership existence and its status as a partnership not taxable as a
corporation for U.S. federal income tax purposes. Subject to Sections 10.7 and
10.8, the Company will at all times preserve and keep in full force and effect
the corporate or partnership existence, as the case may be, of each of its
Restricted Subsidiaries (unless merged into the Company or a Restricted
Subsidiary) and all rights and franchises of the Company and its Restricted
Subsidiaries unless, in the good faith judgment of the Company, the termination
of or failure to preserve and keep in full force and effect such corporate or
partnership existence, right or franchise could not, individually or in the
aggregate, have a Material Adverse Effect.
Section 9.6.Ranking. The Company will ensure that, at all times, all liabilities
of the Company under the Notes will rank in right of payment either pari passu
or senior to all other Debt of the Company except for Debt which is preferred as
a result of being secured as permitted by Section 10.4 (but then only to the
extent of such security).
SECTION 10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are outstanding:
Section 10.1.Incurrence of Debt. The Company will not, and will not permit any
Restricted Subsidiary to, directly or indirectly, create, incur, assume,
guarantee, or otherwise become directly or indirectly liable with respect to,
any Debt, other than:
(a) Debt evidenced by the Notes;
(b) Debt of the Company and its Restricted Subsidiaries
outstanding on the date of the Closing and disclosed in Schedule 5.15
(other than Debt of the Company under the Credit Agreement or under the
MLP Note Guaranty referred to in Section 10.2), and any extensions,
refundings, renewals and refinancings (collectively, a "Refinancing")
thereof, provided that (i) the principal amount of the Debt resulting
from such Refinancing shall not exceed the outstanding principal amount
of such Debt being Refinanced, together with any accrued interest and
premium with respect thereto and any and all costs and expenses related
to such Refinancing, (ii) the maturity date of the Debt resulting from
such Refinancing shall not be earlier than the maturity date of the
Debt being Refinanced, (iii) the average life to maturity of the Debt
resulting from such Refinancing shall not be less than the average life
to maturity of the Debt being Refinanced and (iv) no Default or Event
of Default exists at the time of such Refinancing;
(c) Debt of the Company and its Restricted Subsidiaries if on
the date the Company or such Restricted Subsidiary becomes liable with
respect to any such Debt and immediately after giving effect thereto
and the concurrent retirement of any other Debt:
(i) no Default or Event of Default exists; and
(ii) any such Debt of a Restricted Subsidiary
is permitted pursuant to Section 10.3; and
(iii) the ratio of Consolidated Cash Flow for the
period of four consecutive fiscal quarters ending on, or most
recently ended prior to, such date to Consolidated Interest
Expense is not less than 2.25 to 1; and
(iv) the ratio of Consolidated Debt to Consolidated
Cash Flow for the period of four consecutive fiscal quarters
ending on, or most recently ended prior to, such date is not
greater than 5.00 to 1;
(d) Debt of the Company and its Restricted Subsidiaries
incurred under a Working Capital Facility if, on the date the Company
or such Restricted Subsidiary becomes liable with respect to any such
Debt and immediately after giving effect thereto and the concurrent
retirement of any other such Debt, the Debt outstanding thereunder will
not exceed Consolidated Cash Flow for the period of four consecutive
fiscal quarters ending on, or most recently ended prior to, such date,
provided that there shall have been during the immediately preceding
four consecutive fiscal quarters a period of at least 30 consecutive
days on each of which the Company and its Restricted Subsidiaries would
have been permitted to (but did not) incur on such day under Section
10.1(c) (without reference to the condition stated in clause (i)
thereof) Debt in the amount of the average daily balance of Debt
outstanding under the Working Capital Facility for such 30-day period,
provided further that any such Debt of a Restricted Subsidiary is
permitted pursuant to Section 10.3;
(e) Subordinated Debt of the Company if on the date the
Company becomes liable with respect to any such Subordinated Debt and
immediately after giving effect thereto and the concurrent retirement
of any other Debt, the aggregate amount of all outstanding Subordinated
Debt of the Company shall not exceed $50,000,000;
(f) Debt of the Company and its Restricted Subsidiaries to a
seller of assets or shares purchased by the Company or any Restricted
Subsidiary if on the date the Company becomes liable with respect to
any such Debt and immediately after giving effect thereto and the
concurrent retirement of any other Debt, the aggregate amount of all
outstanding Debt of the Company to all such sellers of assets or shares
shall not exceed $60,000,000, provided that the agreement or instrument
pursuant to which such Debt is incurred (i) contains no financial
covenants more restrictive on the Company or its Restricted
Subsidiaries than those contained in this Agreement and (ii) contains
no events of default (other than in respect of payment of principal and
interest on such Debt and in respect of the accuracy of representations
and warranties made by the Company or its Restricted Subsidiaries
thereunder) which are capable of occurring prior to the occurrence of
any Event of Default, and provided, further, that any such Debt of a
Restricted Subsidiary is permitted pursuant to Section 10.3; and
(g) Debt of the Company under the "Facility B Commitments" or
the "Facility C Commitments" pursuant to the Credit Agreement if on the
date the Company becomes liable with respect to any such Debt and
immediately after giving effect thereto and the concurrent retirement
of any other Debt, the incurrence of such Debt would be permitted under
Section 10.1(c) and any Refinancing thereof, provided that (i) the
principal amount of the Debt resulting from such Refinancing shall not
exceed the outstanding principal amount of such Debt being Refinanced,
together with any accrued interest and premium with respect thereto and
any and all costs and expenses related to such Refinancing, (ii) the
maturity date of the Debt resulting from such Refinancing shall not be
earlier than the maturity date of the Debt being Refinanced, (iii) the
average life to maturity of the Debt resulting from such Refinancing
shall not be less than the average life to maturity of the Debt being
Refinanced, and (iv) the other terms applicable to the Debt resulting
from such Refinancing shall not be more onerous to the Company than the
terms applicable to the Debt being Refinanced, provided further that
the aggregate amount of all such Debt of the Company permitted by this
clause (g) shall not exceed $75,000,000.
For the purposes of this Section 10.1, any Person becoming a Restricted
Subsidiary after the date hereof shall be deemed, at the time it becomes a
Restricted Subsidiary, to have incurred all of its then outstanding Debt, and
any Person Refinancing any Debt shall be deemed to have incurred such Debt at
the time of such Refinancing.
Section 10.2.Guaranty of MLP Notes. The Company will not permit the Guaranty
executed in favor of the holders of the 9-3/8% Senior Secured Notes, due 2006
(the "MLP Senior Notes") issued by Ferrellgas Partners, L.P. (the "MLP Notes
Guaranty") to become effective pursuant to the terms thereof as long as any
obligations, indebtedness or otherwise, of the Company are outstanding under the
Notes. Accordingly, the earliest date that the Subsidiary Guaranty Effectiveness
Date (as defined in the Indenture pursuant to which the MLP Senior Notes were
issued) can occur is 91 days following the indefeasible discharge in full of all
of the obligations of the Company under the Notes and this Agreement.
Section 10.3.Restricted Subsidiary Debt. The Company will not at any time permit
any Restricted Subsidiary to, directly or indirectly, create, incur, assume,
guarantee, have outstanding, or otherwise become or remain directly or
indirectly liable with respect to, any Debt other than:
(a) Debt of a Restricted Subsidiary permitted pursuant to
Section 10.1(b);
(b) Debt of a Restricted Subsidiary to the Company or a
Wholly-Owned Restricted Subsidiary;
(c) secured Debt of a Restricted Subsidiary secured by Liens
permitted by Section 10.4(h), and any Refinancing thereof, provided
that (i) the principal amount of the Debt resulting from such
Refinancing shall not exceed the outstanding principal amount of such
Debt being Refinanced, together with any accrued interest and premium
with respect thereto and any and all costs and expenses related to such
Refinancing, (ii) the maturity date of the Debt resulting from such
Refinancing shall not be earlier than the maturity date of the Debt
being Refinanced, (iii) the average life to maturity of the Debt
resulting from such Refinancing shall not be less than the average life
to maturity of the Debt being Refinanced and (iv) no Default or Event
of Default exists at the time of such Refinancing;
(d) Debt of a Restricted Subsidiary in addition to that
otherwise permitted by the foregoing provisions of this Section 10.3,
provided that on the date the Restricted Subsidiary incurs or otherwise
becomes liable with respect to any such additional Debt and immediately
after giving effect thereto and the concurrent retirement of any other
Debt,
(i) no Default or Event of Default exists, and
(ii) Priority Debt does not exceed 12.5% of
Consolidated Assets.
For the purposes of this Section 10.3, any Person becoming a Restricted
Subsidiary after the date hereof shall be deemed, at the time it becomes a
Restricted Subsidiary, to have incurred all of its then outstanding Debt, and
any Person Refinancing any Debt shall be deemed to have incurred such Debt at
the time of such Refinancing. Also for purposes of this Section 10.3, the Debt
of any Restricted Subsidiary to any Wholly-Owned Restricted Subsidiary the
shares of which are sold by the Company pursuant to Section 10.8(c)(1)(B) shall
be deemed to have been incurred at the time of such sale.
Section 10.4.Liens. The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly create, incur, assume or
permit to exist (upon the happening of a contingency or otherwise) any Lien on
or with respect to any property or asset (including, without limitation, any
document or instrument in respect of goods or accounts receivable) of the
Company or any such Restricted Subsidiary, whether now owned or held or
hereafter acquired, or any income or profits therefrom, or assign or otherwise
convey any right to receive income or profits, except:
(a) Liens for property taxes, assessments or other
governmental charges which are not yet due and payable;
(b) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other similar Liens, in each
case, incurred in the ordinary course of business for sums not yet due
and payable;
(c) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business (i) in connection with
workers' compensation, unemployment insurance and other types of social
security or retirement benefits, or (ii) to secure (or to obtain
letters of credit that secure) the performance of tenders, statutory
obligations, surety bonds, appeal bonds, bids, leases (other than
Capital Leases), performance bonds, purchase, construction or sales
contracts and other similar obligations, in each case not incurred or
made in connection with the borrowing of money, the obtaining of
advances or credit or the payment of the deferred purchase price of
property;
(d) any attachment or judgment Lien, unless the judgment it
secures shall not, within 60 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall not
have been discharged within 60 days after the expiration of any such
stay;
(e) leases or subleases granted to others, easements,
rights-of-way, restrictions and other similar charges or encumbrances,
in each case incidental to, and not interfering with, the ordinary
conduct of the business of the Company or any of its Restricted
Subsidiaries, provided that such Liens do not, in the aggregate,
materially detract from the value of such property or impair the use of
such property;
(f) Liens on property or assets of the Company or
any of its Restricted Subsidiaries securing Debt owing to the
Company or to a Wholly-Owned Restricted Subsidiary;
(g) Liens existing on the date of the Closing and
securing the Debt of the Company and its Restricted Subsidiaries shown
as having "Security" pledged on Schedule 5.15;
(h) any Lien created to secure all or any part of the
purchase price, or to secure Debt incurred or assumed to pay all or any
part of the purchase price or cost of construction, of property (or any
improvement thereon) acquired or constructed by the Company or a
Restricted Subsidiary after the date of the Closing, provided that
(i) any such Lien shall extend solely to the
item or items of such property (or improvement thereon) so acquired
or constructed,
(ii) the principal amount of the Debt secured by any
such Lien shall at no time exceed an amount equal to the
lesser of (A) the cost to the Company or such Restricted
Subsidiary of the property (or improvement thereon) so
acquired or constructed and (B) the Fair Market Value (as
determined in good faith by the board of directors of the
General Partner) of such property (or improvement thereon) at
the time of such acquisition or construction, and
(iii) any such Lien shall be created
contemporaneously with, or within 270 days
after, the acquisition or construction of such property;
(i) Liens on property or assets of any Restricted
Subsidiary securing Indebtedness owing
to the Company or to a Wholly-Owned Restricted Subsidiary;
(j) any Lien existing on property of a Person immediately
prior to its being consolidated with or merged into the Company or a
Restricted Subsidiary, or any Lien existing on any property acquired by
the Company or any Restricted Subsidiary at the time such property is
so acquired (whether or not the Debt secured thereby shall have been
assumed), provided that (i) no such Lien shall have been created or
assumed in contemplation of such consolidation or merger or such
acquisition of property, and (ii) each such Lien shall extend solely to
the item or items of property so acquired;
(k) Liens on personal property leased under leases (including
synthetic leases) entered into by the Company which are accounted for
as operating leases in accordance with GAAP;
(l) any Lien renewing, extending or refunding any Lien
permitted by paragraphs (g), (h) or (j) of this Section 10.4, provided
that (i) the principal amount of Debt secured by such Lien immediately
prior to such extension, renewal or refunding is not increased or the
maturity thereof reduced, (ii) such Lien is not extended to any other
property, and (iii) immediately after such extension, renewal or
refunding no Default or Event of Default would exist; and
(m) other Liens securing Debt not otherwise permitted by
paragraphs (a) through (l), provided that on the date any such Lien is
created, incurred or assumed and immediately after giving effect to the
incurrence of any related Debt and the concurrent retirement of any
other Debt, Priority Debt does not exceed 12.5% of Consolidated Assets.
For the purposes of this Section 10.4, any Person becoming a Restricted
Subsidiary after the date of this Agreement shall be deemed to have incurred all
of its then outstanding Liens at the time it becomes a Restricted Subsidiary,
and any Person Refinancing any Debt secured by any Lien shall be deemed to have
incurred such Lien at the time of such Refinancing.
Section 10.5.Restricted Payments.
(a) Limitation. The Company will not, and will not permit any of its
Restricted Subsidiaries to, at any time, declare or make, or incur any liability
to declare or make, any Restricted Payment provided that the Company may make
one Restricted Payment in each fiscal quarter if:
(i) the amount of such Restricted Payment would not
exceed the sum of
(A) Available Cash for the immediately preceding
fiscal quarter, plus
(B) the lesser of (1) the amount of any Available
Cash for the first 45 days of such fiscal quarter, and (2) the
excess of the aggregate amount of Debt that the Company could
have incurred under the Working Capital Facility pursuant to
Section 10.1(d) over the actual amount of loans outstanding
thereunder at the end of the immediately preceding fiscal
quarter;
(ii) the ratio of Consolidated Cash Flow for the period of
eight consecutive fiscal quarters ending on, or most recently ended
prior to, such time to Consolidated Interest Expense for such period is
greater than 2.0 to 1; and
(iii) no Default or Event of Default would exist;
provided, further, that the Company may declare or order, and make, pay or set
apart a Restricted Payment out of the Restricted Payment Reserve if at such time
(I) no Default or Event of Default exists, and (II) the ratio of Consolidated
Cash Flow for the period of eight consecutive fiscal quarters ending on, or most
recently ended prior to, such time to Consolidated Interest Expense for such
period is greater than 1.25 to 1. For purposes of this Section 10.5, "Restricted
Payment Reserve" means, as of the date of determination, the excess of the
cumulative amount, if any, of Restricted Payment Contributions generated each
prior fiscal year commencing with the fiscal year ended July 31, 1999 over the
cumulative amount of all Restricted Payments previously made from the Restricted
Payment Reserve, and "Restricted Payment Contribution" means an amount equal to
the excess of (x) Consolidated Cash Flow for a fiscal year, over (y) the sum of
(I) consolidated cash interest expense of the Company and its Restricted
Subsidiaries during such fiscal year, plus (II) Maintenance Capital Expenditures
incurred by the Company during such fiscal year, plus (III) the cumulative
amount of Restricted Payments made during such fiscal year.
(b) Time of Payment. The Company will not, nor will it permit any of
its Subsidiaries to, authorize a Restricted Payment that is not payable within
60 days of authorization.
Section 10.6.Restrictions on Dividends of Subsidiaries, Etc. The Company will
not, and will not permit any of its Restricted Subsidiaries to, enter into any
agreement which would restrict any Restricted Subsidiary's ability or right to
pay dividends to, or make advances to or Investments in, the Company or, if such
Restricted Subsidiary is not directly owned by the Company, the "parent"
Subsidiary of such Restricted Subsidiary.
Section 10.7.Mergers and Consolidations. The Company will not, and will not
permit any Restricted Subsidiary to, consolidate with or be a party to a merger
with any other Person or convey, transfer or lease substantially all of its
assets in a single transaction or series of transactions to any Person;
provided, however, that:
(a) any Restricted Subsidiary may merge or consolidate with
or into the Company or any Wholly-Owned Restricted Subsidiary so long
as in any merger or consolidation involving the Company, the Company
shall be the surviving or continuing corporation; and
(b) the Company may consolidate or merge with any other
Person if (i) the surviving entity is a solvent partnership or
corporation organized and existing under the laws of the United States
of America or any State thereof, (ii) the surviving entity expressly
assumes in writing the Company's obligations under the Notes and this
Agreement, (iii) at the time of such consolidation or merger, and after
giving effect thereto, no Default or Event of Default shall have
occurred and be continuing, and (iv) the surviving entity would be
permitted by the provisions of Section 10.1(c) hereof to incur at least
$1.00 of additional Debt owing to a Person other than a Restricted
Subsidiary of the surviving entity.
Section 10.8.Sale of Assets; Sale of Stock. (a) The Company will not, and will
not permit any Restricted Subsidiary to, sell, lease, transfer, abandon or
otherwise dispose of assets (except assets sold for fair market value (x) in the
ordinary course of business or (y) in a Sale and Leaseback Transaction within 90
days following the acquisition or construction thereof); provided that the
foregoing restrictions do not apply to:
(1) the sale, lease, transfer or other disposition of
assets of a Restricted Subsidiary to
the Company or a Wholly-Owned Restricted Subsidiary;
(2) the sale of assets for cash or other property to
a Person or Persons if all of the following conditions are met:
(i) such assets (valued at net book value at the
time of such sale) do not, together with all other assets of
the Company and its Restricted Subsidiaries previously
disposed of (valued at net book value at the time of such
disposition) (other than in the ordinary course of business or
in a Sale and Leaseback Transaction within 90 days following
the acquisition or construction thereof) during the same
fiscal year exceed 10% of Consolidated Assets (which
Consolidated Assets shall be determined as of the last day of
the fiscal year ending on, or most recently ended prior to,
such sale); and
(ii) in the opinion of the board of directors of the
General Partner, the sale is for Fair Market Value and is in
the best interests of the Company.
provided, however, that for purposes of the foregoing calculation,
there shall not be included any assets the proceeds of which were or
are applied within 180 days of the date of sale of such assets to
either (A) the acquisition of fixed assets useful and intended to be
used in the operation of the business of the Company and its Restricted
Subsidiaries within the limitations of Section 10.9 and having a Fair
Market Value (as determined in good faith by the board of directors of
the General Partner) at least equal to that of the assets so disposed
of, or (B) the prepayment at any applicable prepayment premium, of
Senior Debt selected by the Company of the Company or such Restricted
Subsidiary that sold such assets. It is understood and agreed by the
Company that any such proceeds paid and applied to the prepayment of
the Notes as hereinabove provided shall be prepaid as and to the extent
provided in Section 8.2.
(b) The Company will not permit any Restricted Subsidiary to issue or
sell any shares of stock of any class (including as "stock" for the purposes of
this Section 10.8, any warrants, rights or options to purchase or otherwise
acquire stock or other Securities exchangeable for or convertible into stock) of
such Restricted Subsidiary to any Person other than the Company or a
Wholly-Owned Restricted Subsidiary, except for the purpose of qualifying
directors, or except in satisfaction of the validly pre-existing preemptive
rights of minority stockholders in connection with the simultaneous issuance of
stock to the Company and/or a Restricted Subsidiary whereby the Company and/or
such Restricted Subsidiary maintain their same proportionate interest in such
Restricted Subsidiary.
(c) The Company will not sell, transfer or otherwise dispose of any
shares of stock of any Restricted Subsidiary (except to qualify directors) or
any Debt of any Restricted Subsidiary, and will not permit any Restricted
Subsidiary to sell, transfer or otherwise dispose of (except to the Company or a
Wholly-Owned Restricted Subsidiary) any shares of stock or any Debt of any other
Restricted Subsidiary, unless:
(1) either
(A) in the case of such a sale, transfer or
disposition of shares of stock or Debt, simultaneously with
such sale, transfer, or disposition, all shares of stock and
all Debt of such Restricted Subsidiary at the time owned by
the Company and by every other Restricted Subsidiary shall be
sold, transferred or disposed of as an entirety, and the
Restricted Subsidiary being disposed of shall not have any
continuing investment in the Company or any other Restricted
Subsidiary not being simultaneously disposed of; or
(B) in the case of such a sale, transfer or
disposition of shares of stock, at the time of such sale,
transfer or disposition and after giving effect thereto, (i)
no Default or Event of Default exists, and (ii) the minority
interests in the Restricted Subsidiary the shares of which are
being disposed of, after giving effect to such sale, transfer
or disposition, would not exceed 20%;
(2) said shares of stock and Debt are sold, transferred or
otherwise disposed of to a Person, for a cash consideration and on
terms reasonably deemed by the board of directors of the General
Partner to be adequate and satisfactory; and
(3) such sale or other disposition is permitted by
Section 10.8(a).
Section 10.9.Nature of Business. Neither the Company nor any Restricted
Subsidiary will engage in any business if, as a result thereof, the Company and
its Restricted Subsidiaries would not be principally and predominantly engaged
in the business of retail and wholesale propane sales and purchases of
inventory, operation of related propane distribution networks and storage
facilities and the acquisitions, operations and maintenance of such facilities.
Section 10.10.Transactions with Affiliates. The Company will not and will not
permit any Restricted Subsidiary to enter into directly or indirectly any
transaction or group of related transactions (including without limitation the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate, except in the ordinary course and pursuant to
the reasonable requirements of the Company's or such Restricted Subsidiary's
business and upon fair and reasonable terms no less favorable to the Company or
such Restricted Subsidiary than would be obtainable in a comparable arm's-length
transaction with a Person not an Affiliate.
Section 10.11.Certain Refinancings. Notwithstanding the provisions of Section
10.1 or 10.3, the Company will not, and will not permit any Restricted
Subsidiary to, incur any Debt for the purpose of refinancing the Debt of
Ferrellgas Partners, L.P., a Delaware limited partnership and the limited
partner of the Company, or any other entity owning an equity interest in the
Company, provided that the Company may incur Debt for the purpose of refinancing
the Debt of Ferrellgas Partners, L.P. so long as it is a limited partner in the
Company and so long as such incurrence is:
(a) otherwise permitted by the provisions of
Section 10.1; and
(b) after giving effect to the issuance of such Debt and the
concurrent issuance or retirement of any other Debt, no Default or
Event of Default exists and either:
(i) either Fitch IBCA, Inc. shall have assigned a
rating of at least BBB- to the Notes, or Standard & Poor's
Ratings Group, a division of McGraw Hill, shall have assigned
a rating of at least BBB- to the Notes or Moody's Investors
Service, Inc. shall have assigned a rating of at least Baa3 to
the Notes; or
(ii) (A) the ratio of Consolidated Cash Flow for the
period of four consecutive fiscal quarters ending on, or most
recently ended prior to, the date of issuance of such Debt to
Consolidated Interest Expense is not less than 2.75 to 1; and
(B) the ratio of Consolidated Debt to Consolidated Cash Flow
for the period of four consecutive fiscal quarters ending on,
or most recently ended prior to, such date is not greater than
4.50 to 1.
SECTION 11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and
payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise; or
(b) the Company defaults in the payment of any
interest on any Note for more than five
Business Days after the same becomes due and payable; or
(c) the Company defaults in the performance of or
compliance with any term contained in
Section 7.1(d) or Section 10; or
(d) the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default is not
remedied within 30 days after the earlier of (i) a Responsible Officer
obtaining actual knowledge of such default and (ii) the Company
receiving written notice of such default from any holder of a Note (any
such written notice to be identified as a "notice of default" and to
refer specifically to this paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by or on
behalf of the Company or by any officer of the Company in this
Agreement or in any writing furnished in connection with the
transactions contemplated hereby proves to have been false or incorrect
in any material respect on the date as of which made; or
(f) (i) the Company or any Restricted Subsidiary is in
default (as principal or as guarantor or other surety) in the payment
of any principal of or premium or make-whole amount or interest on any
Indebtedness that is outstanding in an aggregate principal amount of at
least $10,000,000 beyond any period of grace provided with respect
thereto, or (ii) the Company or any Restricted Subsidiary is in default
in the performance of or compliance with any term of any evidence of
any Indebtedness in an aggregate outstanding principal amount of at
least $10,000,000 or of any mortgage, indenture or other agreement
relating thereto or any other condition exists, and as a consequence of
such default or condition such Indebtedness has become, or has been
declared (or one or more Persons are entitled to declare such
Indebtedness to be), due and payable before its stated maturity or
before its regularly scheduled dates of payment, or (iii) as a
consequence of the occurrence or continuation of any event or condition
(other than the passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity interests), (x)
the Company or any Restricted Subsidiary has become obligated to
purchase or repay Indebtedness before its regular maturity or before
its regularly scheduled dates of payment in an aggregate outstanding
principal amount of at least $10,000,000, or (y) one or more Persons
have the right to require the Company or any Restricted Subsidiary so
to purchase or repay such Indebtedness; or
(g) the Company, the General Partner or any Restricted
Subsidiary (i) is generally not paying, or admits in writing its
inability to pay, its debts as they become due, (ii) files, or consents
by answer or otherwise to the filing against it of, a petition for
relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy,
insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, (v) is adjudicated as
insolvent or to be liquidated, or (vi) takes action for the purpose of
any of the foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by the
Company, the General Partner or any Subsidiary of the Company, a
custodian, receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its property,
or constituting an order for relief or approving a petition for relief
or reorganization or any other petition in bankruptcy or for
liquidation or to take advantage of any bankruptcy or insolvency law of
any jurisdiction, or ordering the dissolution, winding-up or
liquidation of the Company, the General Partner or any Subsidiary of
the Company, or any such petition shall be filed against the Company,
the General Partner or any Subsidiary of the Company and such petition
shall not be dismissed or appointment discharged within 120 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of $10,000,000 are rendered against one or more
of the Company and its Restricted Subsidiaries and which judgments are
not, within 60 days after entry thereof, bonded, discharged or stayed
pending appeal, or are not discharged within 60 days after the
expiration of such stay; or
(j) If (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is
sought or granted under Section 412 of the Code, (ii) a notice of
intent to terminate any Plan shall have been or is reasonably expected
to be filed with the PBGC or the PBGC shall have instituted proceedings
under Section 4042 of ERISA to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any
ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the aggregate "amount of unfunded benefit
liabilities" (within the meaning of Section 4001(a)(18) of ERISA) under
all Plans, determined in accordance with Title IV of ERISA, shall
exceed $10,000,000, (iv) the Company or any ERISA Affiliate shall have
incurred or is reasonably expected to incur any liability pursuant to
Title I or IV of ERISA or the penalty or excise tax provisions of the
Code relating to employee benefit plans, (v) the Company or any ERISA
Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or
any Restricted Subsidiary establishes or amends any employee welfare
benefit plan that provides post-employment welfare benefits in a manner
that would increase the liability of the Company or any Restricted
Subsidiary thereunder; and any such event or events described in
clauses (i) through (vi) above, either individually or together with
any other such event or events, could reasonably be expected to have a
Material Adverse Effect.
As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
SECTION 12. REMEDIES ON DEFAULT, ETC.
Section 12.1.Acceleration. (a) If an Event of Default with respect to the
Company or the General Partner described in paragraph (g) or (h) of Section 11
(other than an Event of Default described in clause (i) of paragraph (g) or
described in clause (vi) of paragraph (g) by virtue of the fact that such clause
encompasses clause (i) of paragraph (g)) has occurred, all the Notes then
outstanding shall automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 33-1/3% in principal amount of the Notes at the
time outstanding may at any time at its or their option, by notice or notices to
the Company, declare all the Notes then outstanding to be immediately due and
payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of Notes at the
time outstanding affected by such Event of Default may at any time, at its or
their option, by notice or notices to the Company, declare all the Notes held by
it or them to be immediately due and payable.
Upon any Note's becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Note will forthwith mature and the
entire unpaid principal amount of such Note, plus (i) all accrued and unpaid
interest thereon and (ii) the Make-Whole Amount determined in respect of such
principal amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
Section 12.2.Other Remedies. If any Default or Event of Default has occurred and
is continuing, and irrespective of whether any Notes have become or have been
declared immediately due and payable under Section 12.1, the holder of any Note
at the time outstanding may proceed to protect and enforce the rights of such
holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise.
Section 12.3.Rescission. At any time after any Notes have been declared due and
payable pursuant to clause (b) or (c) of Section 12.1, the holders of not less
than 51% in principal amount of the Notes then outstanding, by written notice to
the Company, may rescind and annul any such declaration and its consequences if
(a) the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
Section 12.4.No Waivers or Election of Remedies, Expenses, Etc. No course of
dealing and no delay on the part of any holder of any Note in exercising any
right, power or remedy shall operate as a waiver thereof or otherwise prejudice
such holder's rights, powers or remedies. No right, power or remedy conferred by
this Agreement or by any Note upon any holder thereof shall be exclusive of any
other right, power or remedy referred to herein or therein or now or hereafter
available at law, in equity, by statute or otherwise. Without limiting the
obligations of the Company under Section 15, the Company will pay to the holder
of each Note on demand such further amount as shall be sufficient to cover all
costs and expenses of such holder incurred in any enforcement or collection
under this Section 12, including, without limitation, reasonable attorneys'
fees, expenses and disbursements.
SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
Section 13.1.Registration of Notes. The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes. The name and address of each holder of one or more Notes, each
transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes of each
series.
Section 13.2.Transfer and Exchange of Notes. Upon surrender of any Note at the
principal executive office of the Company for registration of transfer or
exchange (and in the case of a surrender for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or its attorney duly authorized in writing and
accompanied by the address for notices of each transferee of such Note or part
thereof), the Company shall execute and deliver, at the Company's expense
(except as provided below), one or more new Notes (as requested by the holder
thereof) of the same series in exchange therefor, in an aggregate principal
amount equal to the unpaid principal amount of the surrendered Note. Each such
new Note shall be payable to such Person as such holder may request and shall be
substantially in the form of the series of Notes being surrendered as set forth
in Exhibit 1-A, 1-B, 1-C, 1-D or 1-E, as the case may be. Each such new Note
shall be dated and bear interest from the date to which interest shall have been
paid on the surrendered Note or dated the date of the surrendered Note if no
interest shall have been paid thereon. The Company may require payment of a sum
sufficient to cover any stamp tax or governmental charge imposed in respect of
any such transfer of Notes. Notes shall not be transferred in denominations of
less than $100,000, provided that if necessary to enable the registration of
transfer by a holder of its entire holding of Notes, one Note may be in a
denomination of less than $100,000. Any transferee, by its acceptance of a Note
registered in its name (or the name of its nominee), shall be deemed to have
made the representation set forth in Section 6.2.
Section 13.3.Replacement of Notes. Upon receipt by the Company of evidence
reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note
is, or is a nominee for, an original Purchaser or another holder of a
Note with a minimum net worth of at least $50,000,000, such Person's
own unsecured agreement of indemnity shall be deemed to be
satisfactory), or
(b) in the case of mutilation, upon surrender and
cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same series as such lost, stolen, destroyed or mutilated Note, dated
and bearing interest from the date to which interest shall have been paid on
such lost, stolen, destroyed or mutilated Note or dated the date of such lost,
stolen, destroyed or mutilated Note if no interest shall have been paid thereon.
SECTION 14. PAYMENTS ON NOTES.
Section 14.1.Place of Payment. Subject to Section 14.2, payments of principal,
Make-Whole Amount, if any, and interest becoming due and payable on the Notes
shall be made in Liberty, Missouri at the principal office of the Company in
such jurisdiction. The Company may at any time, by notice to each holder of a
Note, change the place of payment of the Notes so long as such place of payment
shall be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
Section 14.2.Home Office Payment. So long as any Purchaser or such Purchaser's
nominee shall be the holder of any Note, and notwithstanding anything contained
in Section 14.1 or in such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, Make-Whole Amount, if any, and interest
by the method and at the address specified for such purpose for such Purchaser
on Schedule A, or by such other method or at such other address as such
Purchaser shall have from time to time specified to the Company in writing for
such purpose, without the presentation or surrender of such Note or the making
of any notation thereon, except that upon written request of the Company made
concurrently with or reasonably promptly after payment or prepayment in full of
any Note, such Purchaser shall surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive
office or at the place of payment most recently designated by the Company
pursuant to Section 14.1. Prior to any sale or other disposition of any Note
held by any Purchaser or such Purchaser's nominee such Purchaser will, at its
election, either endorse thereon the amount of principal paid thereon and the
last date to which interest has been paid thereon or surrender such Note to the
Company in exchange for a new Note or Notes pursuant to Section 13.2. The
Company will afford the benefits of this Section 14.2 to any Institutional
Investor that is the direct or indirect transferee of any Note purchased by any
Purchaser under this Agreement and that has made the same agreement relating to
such Note as such Purchaser has made in this Section 14.2.
SECTION 15. EXPENSES, ETC.
Section 15.1.Transaction Expenses. Whether or not the transactions contemplated
hereby are consummated, the Company will pay all costs and expenses (including
reasonable attorneys' fees of a special counsel and, if reasonably required,
local or other counsel) incurred by each Purchaser or holder of a Note in
connection with such transactions and in connection with any amendments, waivers
or consents under or in respect of this Agreement or the Notes (whether or not
such amendment, waiver or consent becomes effective), including, without
limitation: (a) the costs and expenses incurred in enforcing or defending (or
determining whether or how to enforce or defend) any rights under this Agreement
or the Notes or in responding to any subpoena or other legal process or informal
investigative demand issued in connection with this Agreement or the Notes, or
by reason of being a holder of any Note, and (b) the costs and expenses,
including financial advisors' fees, incurred in connection with the insolvency
or bankruptcy of the Company or any Subsidiary or in connection with any
work-out or restructuring of the transactions contemplated hereby and by the
Notes. The Company will pay, and will save each Purchaser and each other holder
of a Note harmless from, all claims in respect of any fees, costs or expenses if
any, of brokers and finders (other than those retained by such Purchaser or
holder).
Section 15.2.Survival. The obligations of the Company under this Section 15 will
survive the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes, and the termination of
this Agreement.
SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by any Purchaser of any Note or portion thereof or interest therein and the
payment of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of such
Purchaser or any other holder of a Note. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed representations and warranties of the
Company under this Agreement. Subject to the preceding sentence, this Agreement
and the Notes embody the entire agreement and understanding between each
Purchaser and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
SECTION 17. AMENDMENT AND WAIVER.
Section 17.1.Requirements. This Agreement and the Notes may be amended, and the
observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term
(as it is used therein), will be effective as to any Purchaser unless consented
to by such Purchaser in writing, and (b) no such amendment or waiver may,
without the written consent of the holder of each Note at the time outstanding
affected thereby, (i) subject to the provisions of Section 12 relating to
acceleration or rescission, change the amount or time of any prepayment or
payment of principal of, or reduce the rate or change the time of payment or
method of computation of interest or of the Make-Whole Amount on, the Notes,
(ii) change the percentage of the principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver, or (iii) amend
any of Sections 8, 11(a), 11(b), 12, 17 or 20.
Section 17.2.Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or cause
to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise, or grant any security, to any holder of Notes as
consideration for or as an inducement to the entering into by any holder of
Notes of any waiver or amendment of any of the terms and provisions hereof or of
the Notes unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of Notes then
outstanding even if such holder did not consent to such waiver or amendment.
Section 17.3.Binding Effect, Etc. Any amendment or waiver consented to as
provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note. As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or supplemented.
Section 17.4.Notes Held by Company, Etc. Solely for the purpose of determining
whether the holders of the requisite percentage of the aggregate principal
amount of Notes then outstanding approved or consented to any amendment, waiver
or consent to be given under this Agreement or the Notes, or have directed the
taking of any action provided herein or in the Notes to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Company or any of its Affiliates shall be deemed not to be outstanding.
SECTION 18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telefacsimile if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to a Purchaser or such Purchaser's nominee, to such
Purchaser or such Purchaser's nominee at the address specified for such
communications for such Purchaser signature on Schedule A, or at such
other address as such Purchaser or such Purchaser's nominee shall have
specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder
at such address as such other holder shall have specified to the
Company in writing, or
(iii) if to the Company, to the Company at its address set
forth at the beginning hereof to the attention of the Assistant
Treasurer, or at such other address as the Company shall have specified
to the holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
SECTION 19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by each Purchaser at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to each Purchaser, may be
reproduced by such Purchaser by any photographic, photostatic, microfilm,
microcard, miniature photographic or other similar process and such Purchaser
may destroy any original document so reproduced. The Company agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in the
regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence. This
Section 19 shall not prohibit the Company or any other holder of Notes from
contesting any such reproduction to the same extent that it could contest the
original, or from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
SECTION 20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified in writing when received by
such Purchaser as being confidential information of the Company or such
Subsidiary, provided that such term does not include information that (a) was
publicly known or otherwise known to such Purchaser prior to the time of such
disclosure, (b) subsequently becomes publicly known through no act or omission
by such Purchaser or any Person acting on such Purchaser's behalf, (c) otherwise
becomes known to such Purchaser other than through disclosure by the Company or
any Subsidiary or (d) constitutes financial statements delivered to such
Purchaser under Section 7.1 that are otherwise publicly available. Each
Purchaser will maintain the confidentiality of such Confidential Information in
accordance with procedures adopted by such Purchaser in good faith to protect
confidential information of third parties delivered to such Purchaser, provided
that such Purchaser may deliver or disclose Confidential Information to (i) such
Purchaser's directors, trustees, officers, employees, agents, attorneys and
affiliates (to the extent such disclosure reasonably relates to the
administration of the investment represented by such Purchaser's Notes), (ii)
such Purchaser's financial advisors and other professional advisors who agree to
hold confidential the Confidential Information substantially in accordance with
the terms of this Section 20, (iii) any other holder of any Note, (iv) any
Institutional Investor to which such Purchaser sells or offers to sell such Note
or any part thereof or any participation therein (if such Person has agreed in
writing prior to its receipt of such Confidential Information to be bound by the
provisions of this Section 20), (v) any Person from which such Purchaser offers
to purchase any security of the Company (if such Person has agreed in writing
prior to its receipt of such Confidential Information to be bound by the
provisions of this Section 20), (vi) any federal or state regulatory authority
having jurisdiction over such Purchaser, (vii) the National Association of
Insurance Commissioners or any similar organization, or any nationally
recognized rating agency that requires access to information about such
Purchaser's investment portfolio, or (viii) any other Person to which such
delivery or disclosure may be necessary or appropriate (w) to effect compliance
with any law, Rule, regulation or order applicable to such Purchaser, (x) in
response to any subpoena or other legal process, (y) in connection with any
litigation to which such Purchaser is a party or (z) if an Event of Default has
occurred and is continuing, to the extent such Purchaser may reasonably
determine such delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies under such
Purchaser's Notes and this Agreement. Each holder of a Note, by its acceptance
of a Note, will be deemed to have agreed to be bound by and to be entitled to
the benefits of this Section 20 as though it were a party to this Agreement. On
reasonable request by the Company in connection with the delivery to any holder
of a Note of information required to be delivered to such holder under this
Agreement or requested by such holder (other than a holder that is a party to
this Agreement or its nominee), such holder will enter into an agreement with
the Company embodying the provisions of this Section 20.
SECTION 21. SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any one of such
Purchaser's Affiliates as the purchaser of the Notes that such Purchaser has
agreed to purchase hereunder, by written notice to the Company, which notice
shall be signed by both such Purchaser and such Purchaser's Affiliate, shall
contain such Affiliate's agreement to be bound by this Agreement and shall
contain a confirmation by such Affiliate of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such notice,
wherever the word "Purchaser" is used in this Agreement (other than in this
Section 21), such word shall be deemed to refer to such Affiliate in lieu of
such Purchaser. In the event that such Affiliate is so substituted as a
purchaser hereunder and such Affiliate thereafter transfers to such Purchaser
all of the Notes then held by such Affiliate, upon receipt by the Company of
notice of such transfer, wherever the word "Purchaser" is used in this Agreement
(other than in this Section 21), such word shall no longer be deemed to refer to
such Affiliate, but shall refer to such Purchaser, and such Purchaser shall have
all the rights of an original holder of the Notes under this Agreement.
SECTION 22. MISCELLANEOUS.
Section 22.1.Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.
Section 22.2.Payments Due on Non-Business Days. Anything in this Agreement or
the Notes to the contrary notwithstanding, any payment of principal of or
Make-Whole Amount or interest on any Note that is due on a date other than a
Business Day shall be made on the next succeeding Business Day without including
the additional days elapsed in the computation of the interest payable on such
next succeeding Business Day.
Section 22.3.Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 22.4.Construction. Each covenant contained herein shall be construed
(absent express provision to the contrary) as being independent of each other
covenant contained herein, so that compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse compliance with
any other covenant. Where any provision herein refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision shall
be applicable whether such action is taken directly or indirectly by such
Person.
Section 22.5.Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.
Section 22.6.Governing Law. This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the law of
the State of Illinois excluding choice-of-law principles of the law of such
State that would require the application of the laws of a jurisdiction other
than such State.
* * * * *
The execution hereof by the Purchasers shall constitute a contract
among the Company and the Purchasers for the uses and purposes hereinabove set
forth. This Agreement may be executed in any number of counterparts, each
executed counterpart constituting an original but all together only one
agreement.
Very truly yours,
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By__________________________________________
Its_________________________________________
SCHEDULE B
(to Note Purchase Agreement)
DEFINED TERMS
GENERAL PROVISIONS
Where the character or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of this
Agreement, the same shall be done in accordance with GAAP, to the extent
applicable, except where such principles are inconsistent with the express
requirements of this Agreement.
DEFINITIONS
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, (b) any Person beneficially owning or holding, directly or
indirectly, 10% or more of any class of voting or equity interests of such first
Person or any subsidiary of such first Person or any corporation of which such
first Person and the subsidiaries of such first Person beneficially own or hold,
in the aggregate, directly or indirectly, 10% or more of any class of voting or
equity interests, and (c) any officer or director of such first Person. As used
in this definition, "Control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise. Unless the context otherwise clearly requires, any reference to an
"Affiliate" is a reference to an Affiliate (other than a Restricted Subsidiary)
of the Company.
"Asset Acquisition" means (a) an Investment by the Company or any
Restricted Subsidiary in any other Person pursuant to which such Person shall
become a Restricted Subsidiary or shall be merged with or into the Company or
any Restricted Subsidiary, (b) the acquisition by the Company or any Restricted
Subsidiary of the assets of any Person (other than a Restricted Subsidiary)
which constitutes all or substantially all of the assets of such Person or (c)
the acquisition by the Company or any Restricted Subsidiary of any division or
line of business of any Person (other than a Restricted Subsidiary).
"Asset Sale" means any Transfer except:
(a) any
(i) Transfer from a Restricted Subsidiary
to the Company or a Wholly-Owned
Restricted Subsidiary;
(ii) Transfer from the Company to a Wholly-Owned
Restricted Subsidiary; and
(iii) Transfer from the Company to a Restricted
Subsidiary (other than a Wholly-Owned Restricted Subsidiary)
or from a Restricted Subsidiary to another Restricted
Subsidiary (other than a Wholly-Owned Restricted Subsidiary),
which in either case is for Fair Market Value,
so long as immediately before and immediately after the consummation of
any such Transfer and after giving effect thereto, no Default or Event
of Default exists; and
(b) any Transfer made in the ordinary course of business
and involving only property that is inventory held for sale.
"Available Cash" means with respect to any period and without
duplication:
(a) the sum of:
(i) all cash receipts of the Company during such
period from all sources (including, without limitation,
distributions of cash received by the Company from a
Subsidiary and borrowings made under the Working Capital
Facility); and
(ii) any reduction with respect to such period in a
cash reserve previously established pursuant to clause (b)
(ii) below (either by reversal or utilization) from the level
of such reserve at the end of the prior period;
(b) less the sum of:
(i) all cash disbursements of the Company during
such period including, without limitation, disbursements for
operating expenses, taxes, if any, debt service (including,
without limitation, the payment of principal, premium and
interest), redemption of Partnership Interests, capital
expenditures, contributions, if any, to a Subsidiary and cash
distributions to the General Partner and the Limited Partners
(but only to the extent that such cash distributions to the
General Partner and the Limited Partners exceed Available Cash
for the immediately preceding fiscal quarter); and
(ii) any cash reserves established with respect to
such period, and any increase with respect to such period in a
cash reserve previously established pursuant to this clause
(b) (ii) from the level of such reserve at the end of the
prior period, in such amounts as the General Partner
determines in its reasonable discretion to be necessary or
appropriate (A) to provide for the proper conduct of the
business of the Company (including, without limitation,
reserves for future capital expenditures or capital
contributions to a Subsidiary) or (B) to provide funds for
distributions to the General Partner and the Limited Partners
in respect of any one or more of the next four fiscal quarters
or (C) because the distribution of such amounts would be
prohibited by applicable law or by any loan agreement,
security agreement, mortgage, debt instrument or other
agreement or obligation to which the Company is a party or by
which it is bound or its assets are subject.
Notwithstanding the foregoing (x) disbursements (including, without limitation,
contributions to a Subsidiary or disbursements on behalf of a Subsidiary) made
or reserves established, increased or reduced after the end of any fiscal
quarter but on or before the date on which the Company makes its distribution of
Available Cash in respect of such fiscal quarter pursuant to Section 5.3(a)
shall be deemed to have been made, established, increased or reduced, for
purposes of determining Available Cash, with respect to such fiscal quarter if
the General Partner so determines and (y) "Available Cash" with respect to any
period shall not include any cash receipts or reductions in reserves or take
into account any disbursements made or reserves established after the
Liquidation Date.
For purposes of the definition of "Available Cash" the following terms
have the following meanings:
"Additional Limited Partner" means a Person admitted to the
Company as a Limited Partner pursuant to Section 11.6 of the
Partnership Agreement and who is shown as such on the books and records
of the Company,
"Departing Partner" means a former General Partner, from and
after the effective date of any withdrawal or removal of such former
General Partner pursuant to Section 12.1 or Section 12.2 of the
Partnership Agreement.
"Initial Limited Partner means Ferrellgas Partners, L.P., a
Delaware limited partnership.
"Limited Partner" means the Initial Limited Partner, the
General Partner pursuant to Section 4.2 of the Partnership Agreement,
each Substituted Limited Partner, if any, each Additional Limited
Partner and any Departing Partner upon the change of its status from
General Partner to Limited Partner pursuant to Section 12.3 of the
Partnership Agreement, but excluding any such Person from and after the
time it withdraws from the Company.
"Liquidation Date" means (a) in the case of an event giving
rise to the dissolution of the Company of the type described in clauses
(a) and (b) of the first sentence of Section 13.2 of the Partnership
Agreement, the date on which the applicable time period during which
the General Partner and the Limited Partners have the right to elect to
reconstitute the Company and continue its business has expired without
such an election being made, and (b) in the case of any other event
giving rise to the dissolution of the Company, the date on which such
event occurs.
"Partnership Agreement" means the Agreement of Limited Partnership of
Ferrellgas, L.P. dated as of July 5, 1995 among the General Partner and the
Initial Limited Partner.
"Partnership Interest" means the interest of the General Partner or a
Limited Partner in the Company.
"Substituted Limited Partner" means a Person who is admitted
as a Limited Partner to the Company pursuant to Section 11.3 of the
Partnership Agreement in place of and with all the rights of a Limited
Partner and who is shown as a Limited Partner on the books and records
of the Company.
"Business Day" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in San Francisco, California, Chicago, Illinois or
Kansas City, Missouri are required or authorized to be closed.
"Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
"Capital Lease Obligation" means, with respect to any Person and a
Capital Lease, the amount of the obligation of such Person as the lessee under
such Capital Lease which would, in accordance with GAAP, appear as a liability
on a balance sheet of such Person.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.
"Company" means Ferrellgas, L.P., Delaware limited partnership.
"Confidential Information" is defined in Section 20.
"Consolidated Assets" means, at any time, the total assets of the
Company and its Restricted Subsidiaries which would be shown as assets on a
consolidated balance sheet of the Company and its Restricted Subsidiaries as of
such time prepared in accordance with GAAP, after eliminating all amounts
properly attributable to minority interests, if any, in the stock and surplus of
Restricted Subsidiaries.
"Consolidated Cash Flow" means, in respect of any period, the excess,
if any, of (a) the sum of, without duplication, the amounts for such period,
taken as a single accounting period, of (i) Consolidated Net Income for such
period, plus (ii) to the extent deducted in the determination of Consolidated
Net Income for such period, after excluding amounts attributable to minority
interests in Subsidiaries and without duplication, (A) Consolidated Non-Cash
Charges, (B) Consolidated Interest Expense and (C) Consolidated Income Tax
Expense, over (b) any non-cash items increasing Consolidated Net Income for such
period to the extent that such items constitute reversals of Consolidated
Non-Cash Charges for a previous period and which were included in the
computation of Consolidated Cash Flow for such previous period pursuant to the
provisions of the preceding clause (a), provided that in calculating
Consolidated Cash Flow for any such period, (1) Consolidated Cash Flow shall be
calculated after giving effect on a pro forma basis for such period, in all
respects in accordance with GAAP, to any Asset Acquisitions (including, without
limitation any Asset Acquisition by the Company or any Restricted Subsidiary
giving rise to the need to determine Consolidated Cash Flow as a result of the
Company or one of its Restricted Subsidiaries (including any Person that becomes
a Restricted Subsidiary as result of any such Asset Acquisition) incurring,
assuming or otherwise becoming liable for any Debt) occurring during the period
commencing on the first day of such period to and including the date of such
determination, as if such Asset Acquisition occurred on the first day of such
period and (2) Consolidated Cash Flow attributable to any assets or property
subject to an Asset Sale by the Company or any Restricted Subsidiary on or prior
to the date of such determination shall be deemed to be zero for such period.
"Consolidated Debt" means, as of any date of determination, the total
of all Debt of the Company and its Restricted Subsidiaries outstanding on such
date, after eliminating all offsetting debits and credits between the Company
and its Restricted Subsidiaries and all other items required to be eliminated in
the course of the preparation of consolidated financial statements of the
Company and its Restricted Subsidiaries in accordance with GAAP.
"Consolidated Income Tax Expense" means, with respect to any period,
all provisions for Federal, state, local and foreign income taxes of the Company
and its Restricted Subsidiaries for such period as determined on a consolidated
basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any period, the
sum (without duplication) of the following (in each case, eliminating all
offsetting debits and credits between the Company and its Restricted
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Restricted Subsidiaries in accordance with GAAP): (a) all interest in respect of
Debt of the Company and its Restricted Subsidiaries whether earned or accrued
(including non-cash interest payments and imputed interest on Capital Lease
Obligations) deducted in determining Consolidated Net Income for such period,
and (b) all debt discount and expense amortized or required to be amortized in
the determination of Consolidated Net Income for such period, provided that for
purposes of making any computation pursuant to Section 10.1(c)(iii) and Section
10.11 (including any calculation of Consolidated Cash Flow relating thereto),
Consolidated Interest Expense shall be determined on a pro forma basis giving
effect to the incurrence of Debt (and the application of proceeds thereof) which
is the subject of such computation as if such Debt had been incurred (and the
proceeds thereof applied) on the first day of such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Restricted Subsidiaries for such period
(taken as a cumulative whole), as determined in accordance with GAAP, after
eliminating all offsetting debits and credits between the Company and its
Restricted Subsidiaries and all other items required to be eliminated in the
course of the preparation of consolidated financial statements of the Company
and its Restricted Subsidiaries in accordance with GAAP, provided that there
shall be excluded:
(a) the income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary or is merged into or consolidated with the
Company or a Subsidiary, and the income (or loss) of any Person,
substantially all of the assets of which have been acquired in any
manner, realized by such other Person prior to the date of acquisition,
(b) the income (or loss) of any Person (other than a
Subsidiary) in which the Company or any Subsidiary has an ownership
interest, except to the extent that any such income has been actually
received by the Company or such Subsidiary in the form of cash
dividends or similar cash distributions,
(c) the undistributed earnings of any Restricted Subsidiary
to the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary is not at the time
permitted by the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation
applicable to such Restricted Subsidiary,
(d) any aggregate net gain or loss during such period arising
from the sale, conversion, exchange or other disposition of capital
assets (such term to include, without limitation, (i) all non-current
assets and, without duplication, and (ii) the following, whether or not
current: all fixed assets, whether tangible or intangible, all
inventory sold in conjunction with the disposition of fixed assets, and
all Securities), and
(e) any net income or gain or loss during such period from
(i) any change in accounting principles in accordance with GAAP, (ii)
any prior period adjustments resulting from any change in accounting
principles in accordance with GAAP, or (iii) any extraordinary items.
"Consolidated Non-Cash Charges" means, with respect to any period, the
aggregate depreciation and amortization (other than amortization of debt
discount), and any non-cash employee compensation expenses for such period, in
each case, reducing Consolidated Net Income of the Company and its Restricted
Subsidiaries for such period as determined on a consolidated basis in accordance
with GAAP.
"Credit Agreement" means the Second Amended and Restated Credit
Agreement dated July 2, 1998, between the Company and the banks named therein,
as the same may be amended and supplemented from time to time.
"Debt" means, with respect to any Person, without duplication,
(a) its liabilities for borrowed money;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable arising in
the ordinary course of business but including, without limitation, all
liabilities created or arising under any conditional sale or other
title retention agreement with respect to any such property);
(c) its Capital Lease Obligations;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities); and
(e) any Guaranty of such Person with respect to
liabilities of a type described in any of
clauses (a) through (d) hereof.
Debt of any Person shall include all obligations of such Person of the character
described in clauses (a) through (e) to the extent such Person remains legally
liable in respect thereof notwithstanding that any such obligation is deemed to
be extinguished under GAAP.
"Default" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
"Default Rate" means with respect to any Note that rate of interest
that is the greater of (i) 2% per annum above the rate of interest stated in
clause (a) of the first paragraph of such Note or (ii) 2% over the rate of
interest publicly announced by Wells Fargo Bank, N.A. in San Francisco,
California as its "base" or "prime" rate.
"Distribution" means, in respect of any corporation, association or
other business entity:
(a) dividends or other distributions or payments on capital
stock or other equity interest of such corporation, association or
other business entity (except distributions in such stock or other
equity interest); and
(b) the redemption, retirement, purchase or acquisition of
such stock or other equity interests or of warrants, rights or other
options to purchase such stock or other equity interests (except when
solely in exchange for such stock or other equity interests) unless
made, contemporaneously, from the net proceeds of a sale of such stock
or other equity interests.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under Section 414 of the Code.
"Event of Default" is defined in Section 11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, at any time and with respect to any
property, the sale value of such property that would be realized in an
arm's-length sale at such time between an informed and willing buyer and an
informed and willing seller (neither being under a compulsion to buy or sell).
"GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.
"General Partner" means Ferrellgas, Inc., a Delaware corporation.
"Governmental Authority" means
(a) the government of
(i) the United States of America or any
State or other political subdivision
thereof, or
(ii) any jurisdiction in which the Company or
any Subsidiary conducts all or any
part of its business, or which asserts jurisdiction
over any properties of the Company or any
Subsidiary, or
(b) any entity exercising executive, legislative,
judicial, regulatory or administrative
functions of, or pertaining to, any such government.
"Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such Indebtedness or obligation or
any property constituting security
therefor;
(b) to advance or supply funds (i) for the purchase or
payment of such Indebtedness or obligation, or (ii) to maintain any
working capital or other balance sheet condition or any income
statement condition of any other Person or otherwise to advance or make
available funds for the purchase or payment of such Indebtedness or
obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of any other Person to make payment of the
Indebtedness or obligation; or
(d) otherwise to assure the owner of such
Indebtedness or obligation against loss in
respect thereof.
In any computation of the Indebtedness or other liabilities of the obligor under
any Guaranty, the Indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).
"Holder" or "holder" means, with respect to any Note, the Person in
whose name such Note is registered in the register maintained by the Company
pursuant to Section 13.1.
"Indebtedness" with respect to any Person means, at any time, without
duplication,
(a) its liabilities for borrowed money and its
redemption obligations in respect of
mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable arising in
the ordinary course of business but including all liabilities created
or arising under any conditional sale or other title retention
agreement with respect to any such property);
(c) all liabilities appearing on its balance sheet in
accordance with GAAP in respect of
Capital Leases;
(d) all liabilities for borrowed money secured by any Lien
with respect to any property owned by such Person (whether or not it
has assumed or otherwise become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its
account by banks and other financial institutions (whether or not
representing obligations for borrowed money); and
(f) any Guaranty of such Person with respect to
liabilities of a type described in any of
clauses (a) through (e) hereof.
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (f) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
"Institutional Investor" means (a) any original purchaser of a Note,
(b) any holder of a Note holding more than 2% of the aggregate principal amount
of the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Investment" means any investment, made in cash or by delivery of
property, by the Company or any of its Restricted Subsidiaries (i) in any
Person, whether by acquisition of stock, Indebtedness or other obligations or
Security, or by loan, Guaranty, advance, capital contribution or otherwise, or
(ii) in any property that would be classified as Investments on a balance sheet
prepared in accordance with GAAP.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).
"Maintenance Capital Expenditures" means cash capital expenditures made
to maintain, up to the level thereof that existed at the time of such
expenditure, the operating capacity of the capital assets of the Company and its
Restricted Subsidiaries, taken as a whole, as such assets existed at the time of
such expenditure.
"Make-Whole Amount" is defined in Section 8.6.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties or prospects of the Company and
its Restricted Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Restricted Subsidiaries taken as a whole, or (b) the ability of
the Company to perform its obligations under this Agreement and the Notes, or
(c) the validity or enforceability of this Agreement or the Notes.
"Memorandum" is defined in Section 5.3.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in Section 4001(a)(3) of ERISA).
"Notes", "Series A Notes", "Series B Notes", "Series C Notes", "Series
D Notes" and "Series E Notes" are defined in Section 1.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, joint venture, corporation,
limited liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in Section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"Preferred Stock" means any class of capital stock of a corporation
that is preferred over any other class of capital stock of such corporation as
to the payment of dividends or the payment of any amount upon liquidation or
dissolution of such corporation.
"Priority Debt" means, without duplication, the sum of (a) all Debt of
the Company and its Restricted Subsidiaries secured by Liens permitted by
Section 10.4(m), and (b) all Debt of Restricted Subsidiaries that is not
permitted by Section 10.3(a), (b) or (c).
"property" or "properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, choate
or inchoate.
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"Refinancing" is defined in Section 10.1(b).
"Required Holders" means, at any time, the holders of at least 51% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.
"Restricted Payment" means any Distribution in respect of the Company.
For purposes of this Agreement, the amount of any Restricted Payment made in
property shall be the greater of (x) the Fair Market Value of such property (as
determined in good faith by the board of directors (or equivalent governing
body) of the Person making such Restricted Payment) and (y) the net book value
thereof on the books of such Person, in each case determined as of the date on
which such Restricted Payment is made.
"Restricted Subsidiary" means any Subsidiary (i) of which more than 80%
of the Voting Stock is beneficially owned, directly or indirectly by the
Company, (ii) which is organized under the laws of the United States or any
State thereof, (iii) which maintains substantially all of its assets and
conducts substantially all of its business within the United States, and (iv)
which is properly designated as such by the Company in the most recent notice
(or, prior to any such notice, on Schedule 5.4) with respect to such Subsidiary
given by the Company pursuant to and in accordance with the provisions of
Section 7.4.
"Sale and Leaseback Transaction" means, with respect to a Person and
property, a transaction or series of transactions pursuant to which such Person
sells such property with the intent at the time of entering into such
transaction or transactions of leasing such property for a term in excess of six
months.
"Securities Act" means the Securities Act of 1933, as amended from time
to time.
"Security" has the meaning set forth in section 2(a)(1) of the
Securities Act of 1933, as amended.
"Senior Debt" means (a) any Debt of the Company (other than
Subordinated Debt) and (b) any Debt of any Restricted Subsidiary.
"Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or comptroller of the Company.
"Subordinated Debt" means any Debt of the Company that shall contain or
have applicable thereto subordination provisions substantially in the form set
forth in Exhibit 10.1 attached hereto providing for the subordination thereof to
the Notes, or other provisions as may be approved in writing prior to the
incurrence thereof by the Holders of not less than 66-2/3% in aggregate
principal amount or the outstanding Notes.
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries (unless such partnership can and does ordinarily
take major business actions without the prior approval of such Person or one or
more of its Subsidiaries). Unless the context otherwise clearly requires, any
reference to a "Subsidiary" is a reference to a Subsidiary of the Company.
"Subsidiary Stock" means the stock (or any options or warrants to
purchase stock or other Securities exchangeable for or convertible into stock)
of any Restricted Subsidiary.
"Transfer" means, with respect to any Person, any transaction in which
such Person sells, conveys, abandons, transfers, leases (as lessor), or
otherwise disposes of (including, without limitation, in connection with a Sale
Leaseback Transaction), any of its property, including, without limitation,
Subsidiary Stock.
"Unrestricted Subsidiary" means a Subsidiary which is not a Restricted
Subsidiary.
"Voting Stock" means (i) Securities of any class of classes, the
holders of which are ordinarily, in the absence of contingencies, entitled to
elect a majority of the directors (or Persons performing similar functions) or
(ii) in the case of a partnership or joint venture, interests in the profits or
capital thereof entitling the holders of such interests to approve major
business actions.
"Wholly-Owned Restricted Subsidiary" means, at any time, any Restricted
Subsidiary one hundred percent (100%) of all of the equity interests (except
directors' qualifying shares) and voting interests of which are owned by any one
or more of the Company and the Company's other Wholly-Owned Restricted
Subsidiaries at such time.
"Working Capital Facility" means the Debt facility made available to
the Company for working capital purposes under the "Facility A Commitments"
pursuant to the Credit Agreement dated June 30, 1998, between the Company and
the banks named therein, as from time to time amended, supplemented and
Refinanced and any other credit agreement from time to time entered into by the
Company and its Restricted Subsidiaries for purposes of obtaining working
capital Debt.
EXHIBIT 1-A
(to Note Purchase Agreement)
[FORM OF SERIES A NOTE]
FERRELLGAS, L.P.
6.99% SENIOR NOTE, SERIES A, DUE AUGUST 1, 2005
FOR VALUE RECEIVED, the undersigned, FERRELLGAS, L.P. (herein called
the "Company"), a limited partnership organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on August 1,
2005 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 6.99% per annum from
the date hereof, payable semiannually, on the first day of February and August
in each year, commencing with the February or August next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 8.99% or (ii) 2% over the rate of interest publicly
announced by Wells Fargo Bank, N.A. from time to time in San Francisco,
California as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Liberty, Missouri or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of the 6.99% Senior Notes, Series A (herein called the
"Series A Notes"), issued pursuant to the Note Purchase Agreement, dated as of
July 1, 1998 (as from time to time amended, the "Note Purchase Agreement"),
between the Company and the Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Series A Note and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series A Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of Illinois excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By___________________________________________
Its__________________________________________
EXHIBIT 1-B
(to Note Purchase Agreement)
[FORM OF SERIES B NOTE]
FERRELLGAS, L.P.
7.08% SENIOR NOTE, SERIES B, DUE AUGUST 1, 2006
FOR VALUE RECEIVED, the undersigned, FERRELLGAS, L.P. (herein called
the "Company"), a limited partnership organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on August 1,
2006 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 7.08% per annum from
the date hereof, payable semiannually, on the first day of February and August
in each year, commencing with the February or August next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 9.08% or (ii) 2% over the rate of interest publicly
announced by Wells Fargo Bank, N.A. from time to time in San Francisco,
California as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Liberty, Missouri or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of the 7.08% Senior Notes, Series B (herein called the
"Series B Notes"), issued pursuant to Note Purchase Agreement, dated as of July
1, 1998 (as from time to time amended, the "Note Purchase Agreement"), between
the Company and the Purchasers named therein and is entitled to the benefits
thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Purchase Agreement and (ii) to have made the representation set forth in
Section 6.2 of the Note Purchase Agreement.
This Note is a registered Series B Note and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series B Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of Illinois excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By_________________________________________
Its____________________________________________
EXHIBIT 1-C
(to Note Purchase Agreement)
[FORM OF SERIES C NOTE]
FERRELLGAS, L.P.
7.12% SENIOR NOTE, SERIES C, DUE AUGUST 1, 2008
FOR VALUE RECEIVED, the undersigned, FERRELLGAS, L.P. (herein called
the "Company"), a limited partnership organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on August 1,
2008 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 7.12% per annum from
the date hereof, payable semiannually, on the first day of February and August
in each year, commencing with the February or August next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 9.12% or (ii) 2% over the rate of interest publicly
announced by Wells Fargo Bank, N.A. from time to time in San Francisco,
California as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Liberty Missouri or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of the 7.12% Senior Notes, Series C (herein called the
"Series C Notes"), issued pursuant to Note Purchase Agreement, dated as of July
1, 1998 (as from time to time amended, the "Note Purchase Agreement"), between
the Company and the Purchasers named therein and is entitled to the benefits
thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Purchase Agreement and (ii) to have made the representation set forth in
Section 6.2 of the Note Purchase Agreement.
This Note is a registered Series C Note and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series C Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of Illinois excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By___________________________________________
Its__________________________________________
EXHIBIT 1-D
(to Note Purchase Agreement)
[FORM OF SERIES D NOTE]
FERRELLGAS, L.P.
7.24% SENIOR NOTE, SERIES D, DUE AUGUST 1, 2010
FOR VALUE RECEIVED, the undersigned, FERRELLGAS, L.P. (herein called
the "Company"), a limited partnership organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on August 1,
2010 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 7.24% per annum from
the date hereof, payable semiannually, on the first day of February and August
in each year, commencing with the February or August next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 9.24% or (ii) 2% over the rate of interest publicly
announced by Wells Fargo Bank, N.A. from time to time in San Francisco,
California as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Liberty Missouri or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of the 7.24% Senior Notes, Series D (herein called the
"Series D Notes"), issued pursuant to Note Purchase Agreement, dated as of July
1, 1998 (as from time to time amended, the "Note Purchase Agreement"), between
the Company and the Purchasers named therein and is entitled to the benefits
thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Purchase Agreement and (ii) to have made the representation set forth in
Section 6.2 of the Note Purchase Agreement.
This Note is a registered Series D Note and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series D Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of Illinois excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By______________________________________
Its____________________________________
EXHIBIT 1-E
(to Note Purchase Agreement)
[FORM OF SERIES E NOTE]
FERRELLGAS, L.P.
7.42% SENIOR NOTE, SERIES E, DUE AUGUST 1, 2013
FOR VALUE RECEIVED, the undersigned, FERRELLGAS, L.P. (herein called
the "Company"), a limited partnership organized and existing under the laws of
the State of Delaware, hereby promises to pay to [_____________________] or
registered assigns, the principal sum of [______________] DOLLARS on August 1,
2013 with interest (computed on the basis of a 360-day year of twelve 30-day
months) (a) on the unpaid balance thereof at the rate of 7.42% per annum from
the date hereof, payable semiannually, on the first day of February and August
in each year, commencing with the February or August next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 9.42% or (ii) 2% over the rate of interest publicly
announced by Wells Fargo Bank, N.A. from time to time in San Francisco,
California as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of the Company in Liberty Missouri or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of the 7.42% Senior Notes, Series E (herein called the
"Series E Notes"), issued pursuant to Note Purchase Agreement, dated as of July
1, 1998 (as from time to time amended, the "Note Purchase Agreement"), between
the Company and the Purchasers named therein and is entitled to the benefits
thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i)
to have agreed to the confidentiality provisions set forth in Section 20 of the
Note Purchase Agreement and (ii) to have made the representation set forth in
Section 6.2 of the Note Purchase Agreement.
This Note is a registered Series E Note and, as provided in the Note
Purchase Agreement, upon surrender of this Note for registration of transfer,
duly endorsed, or accompanied by a written instrument of transfer duly executed,
by the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series E Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.
This Note is subject to optional prepayment, in whole or from time to
time in part, at the times and on the terms specified in the Note Purchase
Agreement, but not otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note shall be construed and enforced in accordance with, and the
rights of the issuer and holder hereof shall be governed by, the law of the
State of Illinois excluding choice-of-law principles of the law of such State
that would require the application of the laws of a jurisdiction other than such
State.
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
By____________________________________________________
Its___________________________________________________
EXHIBIT 4.4(a)
(to Note Purchase Agreement)
FORM OF OPINION OF SPECIAL COUNSEL FOR THE COMPANY
The closing opinion of Bryan Cave LLP, special counsel for the Company,
its Restricted Subsidiaries and the General Partner, which is called for by
Section 4.4(a) of the Note Purchase Agreement, shall be dated the date of the
Closing and addressed to the Purchasers, shall be satisfactory in scope and form
to the Purchasers and shall be to the effect that:
1. The Company is a partnership, duly formed, validly
existing and in good standing under the laws of the State of Delaware,
has the partnership power and authority to execute and perform the Note
Purchase Agreement and to issue the Notes and has the requisite
partnership power and authority to conduct its business in all material
respects as presently conducted and, based solely on certificates of
foreign qualification provided by the Secretary of State of each
jurisdiction, is duly qualified or registered as a foreign partnership
to transact business in, and is in good standing as a foreign
partnership in each jurisdiction set forth on Schedule I hereto, and,
to our knowledge, such jurisdictions are the only jurisdictions in
which the Company conducts any business that requires qualification or
registration to conduct business as a foreign partnership, except where
the failure to so qualify or register would not have a Material Adverse
Effect.
2. Each Restricted Subsidiary of the Company is a
corporation or limited partnership duly incorporated or formed, as the
case may be, validly existing and in good standing under the laws of
its jurisdiction of incorporation or formation and, based solely upon
certificates of foreign qualification provided by the Secretary of
State of each jurisdiction, is duly qualified or registered as a
foreign corporation or limited partnership to transact business in, and
is in good standing as a foreign corporation or limited partnership in
each jurisdiction set forth on Schedule II hereto, and, to our
knowledge, such jurisdictions are the only jurisdictions in which the
Restricted Subsidiaries of the Company conduct any business that
requires qualification or registration to conduct business as a foreign
corporation or partnership, except where the failure to so qualify or
register would not have a material adverse effect upon the respective
Restricted Subsidiaries; and all of the issued and outstanding shares
of capital stock or other ownership interests of each such Restricted
Subsidiary, as applicable, have been validly issued, are fully paid and
non-assessable and the Company and/or one or more Restricted
Subsidiaries is the holder of record of such shares or ownership
interests.
3. The Note Purchase Agreement has been duly authorized by
all necessary partnership action on the part of the Company, has been
duly executed and delivered by the Company and constitutes the legal,
valid and binding obligation of the Company enforceable in accordance
with its terms, except to the extent that enforceability may be limited
by applicable bankruptcy, insolvency, fraudulent conveyance and similar
laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the enforceability of such principles is
considered in a proceeding in equity or at law).
4. The Notes have been duly authorized by all necessary
partnership action on the part of the Company, have been duly executed
and delivered by the Company, and when paid for by the Purchasers, will
constitute the legal, valid and binding obligations of the Company
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance and similar laws affecting creditors'
rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a
proceeding in equity or at law).
5. No approval, consent, registration, qualification or
other action on the part of, or filing with any governmental body,
Federal, state or local, is required for the execution, delivery and
performance by the Company of the Note Purchase Agreement or the
execution, delivery and performance by the Company of the Notes,
except, in each case, such approvals, consents, registrations, or
qualifications as have been obtained, or set forth or contemplated in
the Note Purchase Agreement.
6. The issuance and sale of the Notes and the execution,
delivery and performance by the Company of the Note Purchase Agreement
do not violate applicable provisions of statutory law applicable to or
binding on the Company or any order of any court or governmental
authority or agency applicable to or binding on the Company, or violate
or result in any breach of any of the provisions of or constitute a
default under, or result in the creation or imposition of a Lien with
respect to, any material bond, note, debenture or other evidence of
indebtedness or any material indenture, mortgage, deed of trust, loan
agreement, contract, lease or other material instrument for money
borrowed known to us to which the Company is a party or by which the
Company is bound or to which the property of the Company is subject,
nor will such action result in a breach or violation of the Certificate
of Formation or Articles of Partnership of the Company; provided,
however, that, for purposes of this paragraph 6, no opinion is
expressed with respect to Federal or state securities laws, other
antifraud laws and fraudulent transfer laws.
7. The issuance, sale and delivery of the Notes by the
Company under the circumstances contemplated by the Note Purchase
Agreement do not, under existing law, require the registration of the
Notes under the Securities Act of 1933, as amended, or the
qualification of an indenture in respect thereof under the Trust
Indenture Act of 1939, as amended.
8. To our knowledge, there are no actions, suits or
proceedings pending or overtly threatened by written communication
against the Company or any Restricted Subsidiary in any court or before
any arbitrator of any kind or before or by any Governmental Authority
either (i) which purport to affect the Note Purchase Agreement or the
Notes, or (ii) that, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.
9. The issuance of the Notes and the use of the proceeds of
the sale of the Notes in accordance with the provisions of and as
contemplated by the Note Purchase Agreement (including, without
limitation, the representations and warranties set forth in the Note
Purchase Agreement) do not violate or conflict with Regulation T, U or
X of the Board of Governors of the Federal Reserve System.
10. The Company is not an "investment company,"
or a company "controlled" by an
"investment company," under the Investment Company Act of 1940, as
amended.
11. A court sitting in the State of Missouri will look to the
conflict of law rules of the State of Missouri to determine which law
governs. Under the conflict of law rules of the State of Missouri, a
court sitting in the State of Missouri should give effect to the
contractual choice of law clause in the Note Purchase Agreement and the
Notes electing Illinois law assuming that the Purchasers have
reasonable contacts with the State of Illinois, including without
limitation, that Allstate Life Insurance Company, one of the Purchasers
is headquartered in the State of Illinois, that many of the Purchasers
have offices or agents in the State of Illinois, that the Notes will be
delivered in the State of Illinois, and that counsel to the Purchasers
is located in the State of Illinois.
The opinion of Bryan Cave LLP shall be limited to the laws of the State
of Missouri, the Delaware Revised Uniform Limited Partnership Act, the general
business corporation law of the State of Delaware and the Federal laws of the
United States. In rendering the opinions set forth in paragraphs (3) and (4)
above, Bryan Cave LLP shall assume that the laws of Missouri govern the Note
Purchase Agreement and the Notes. The opinion of Bryan Cave LLP shall cover such
other matters relating to the sale of the Notes as the Purchasers may reasonably
request. With respect to matters of fact on which such opinion is based, such
counsel shall be entitled to rely on appropriate certificates of public
officials and officers of the Company and upon representations of the Company
and the Purchasers delivered in connection with the issuance and sale of the
Notes.
EXHIBIT 4.4(b)
(to Note Purchase Agreement)
FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The closing opinion of Chapman and Cutler, special counsel for the
Purchasers, called for by Section 4.4(b) of the Note Purchase Agreement, shall
be dated the date of the Closing and addressed to the Purchasers, shall be
satisfactory in form and substance to the Purchasers and shall be to the effect
that:
1. The Company is a partnership, validly existing and in
good standing under the laws of the State of Delaware and has the power
and the authority to execute and deliver the Note Purchase Agreement
and to issue the Notes.
2. The Note Purchase Agreement has been duly authorized by
all necessary action on the part of the Company, has been duly executed
and delivered by the Company and constitutes the legal, valid and
binding contract of the Company enforceable in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent conveyance and
similar laws affecting creditors' rights generally, and general
principles of equity (regardless of whether the application of such
principles is considered in a proceeding in equity or at law).
3. The Notes have been duly authorized by all necessary
action on the part of the Company, and the Notes being delivered on the
date hereof have been duly executed and delivered by the Company and
constitute the legal, valid and binding obligations of the Company
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance and similar laws affecting creditors'
rights generally, and general principles of equity (regardless of
whether the application of such principles is considered in a
proceeding in equity or at law).
4. The issuance, sale and delivery of the Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under
existing law, require the registration of the Notes under the
Securities Act of 1933, as amended, or the qualification of an
indenture under the Trust Indenture Act of 1939, as amended.
The opinion of Chapman and Cutler shall also state that the opinion of
Bryan Cave LLP, special counsel for the Company, is satisfactory in scope and
form to Chapman and Cutler and that, in their opinion, the Purchasers are
justified in relying thereon.
In rendering the opinion set forth in paragraph 1 above, Chapman and
Cutler may rely, as to matters referred to in paragraph 1, solely upon an
examination of the Certificate of Formation certified by, and a certificate of
good standing of the Company from, the Secretary of State of the State of
Delaware, the Articles of Partnership of the Company and the general partnership
law of the State of Delaware. The opinion of Chapman and Cutler shall be limited
to the laws of the State of Illinois, the Delaware Revised Uniform Limited
Partnership Act and the Federal laws of the United States.
With respect to matters of fact upon which such opinion is based,
Chapman and Cutler may rely on appropriate certificates of public officials and
officers of the Company and upon representations of the Company and the
Purchasers delivered in connection with the issuance and sale of the Notes.
EXHIBIT 10.1
(to Note Purchase Agreement)
SUBORDINATION PROVISIONS APPLICABLE TO
Subordinated Debt
(a) The indebtedness evidenced by the subordinated notes and any
renewals or extensions thereof, premium, if any, interest (including, without
limitation any such interest accruing subsequent to the filing by or against the
Company of any proceeding brought under Chapter 11 of the Bankruptcy Code (11
U.S.C. Section 100 et seq.)) and any fees, charges, expenses or other sums
payable under or in respect of the agreements pursuant to which such
subordinated notes were issued, shall at all times be wholly and unconditionally
subordinate and junior in right of payment to any and all indebtedness of the
Company (including principal, premium, if any, accrued and unpaid interest,
including any interest which may accrue subsequent to commencement of
proceedings under bankruptcy laws (whether or not such interest is allowed as a
claim pursuant to the provisions of any such bankruptcy laws) evidenced by the
Company's $109,000,000 aggregate principal amount 6.99% Senior Notes, Series A,
due August 1, 2005, $37,000,000 aggregate principal amount 7.08% Senior Notes,
Series B, due August 1, 2006, $52,000,000 aggregate principal amount 7.12%
Senior Notes, Series C, due August 1, 2008, $82,000,000 aggregate principal
amount 7.24% Senior Notes, Series D, due August 1, 2010, and $70,000,000
aggregate principal amount 7.42% Senior Notes, Series E, due August 1, 2013
issued pursuant to the Note Purchase Agreement, dated as of July 1, 1998, as the
same shall be amended from time to time, between the Company and the
institutional investors named in Schedule A attached thereto and all other
amounts due under said Note Purchase Agreement (together with any renewal,
replacement or refinancing thereof, herein called "Superior Indebtedness"), in
the manner and with the force and effect hereafter set forth:
(1) In the event of any (i) liquidation, dissolution or
winding up of the Company, voluntary or involuntary, (ii) any
execution, sale, receivership, insolvency, bankruptcy, liquidation,
readjustment, reorganization or other similar proceeding relative to
the Company or its property, (iii) any general assignment by the
Company for the benefit of creditors, or (iv) any distribution,
division, marshalling or application of any of the properties or assets
of the Company or the proceeds thereof to creditors, voluntary or
involuntary, and whether or not involving legal proceedings, then and
in any event:
(A) all principal, premium, if any, and interest and
all other sums owing on all Superior Indebtedness shall first
be indefeasibly paid in full in cash before any payment or
distribution of any kind or character is made upon the
indebtedness evidenced by the subordinated notes; and in any
such event any payment or distribution of any kind or
character, whether in cash, property or securities (other than
in securities, including equity securities, or other evidences
of indebtedness, the payment of which is unconditionally
subordinated (to the same extent as the subordinated notes) to
the payment of all Superior Indebtedness which may at the time
be outstanding) which shall be made upon or in respect of the
subordinated notes shall immediately be paid over to the
holders of such Superior Indebtedness, pro rata, for
application in payment thereof, unless and until such Superior
Indebtedness shall have been indefeasibly paid or satisfied in
full in cash;
(2) In the event that the subordinated notes are in default
under circumstances when the foregoing clause (l) shall not be
applicable, the holders of the subordinated notes shall be entitled to
payments of principal, premium, if any, or interest only after there
shall first have been indefeasibly paid in full in cash all Superior
Indebtedness outstanding at the time the subordinated notes so become
in default; and
(3) During the continuance of any default with respect to any
Superior Indebtedness, no payment of principal, premium, if any, or
interest or any other fees, charges, expenses or other sums payable
under or in respect of the agreements pursuant to which such
subordinated notes were issued shall be made on the subordinated notes.
(b) The holder of each subordinated note agrees that: (1) it will not
initiate a proceeding for liquidation, dissolution or winding-up of the Company,
or for execution, sale, receivership, insolvency, bankruptcy, liquidation,
readjustment, reorganization or other similar proceeding relative to the Company
or its property and (2) it will not accelerate the maturity of or enforce the
collection of the subordinated notes.
(c) The holder of each subordinated note undertakes and agrees for
the benefit of each holder of Superior Indebtedness to execute, verify, deliver
and file any proofs of claim within 30 days before the expiration of the time to
file the same which any holder of Superior Indebtedness may at any time require
in order to prove and realize upon any rights or claims pertaining to the
subordinated notes and to effectuate the full benefit of the subordination
contained herein; and upon failure of the holder of any subordinated note so to
do, any such holder of Superior Indebtedness shall be deemed to be irrevocably
appointed the agent and attorney-in-fact of the holder of such note to execute,
verify, deliver and file any such proofs of claim.
(d) No right of any holder of any Superior Indebtedness to enforce
subordination as herein provided shall at any time or in any way be affected or
impaired by any failure to act on the part of the Company or the holders of
Superior Indebtedness, or by any noncompliance by the Company with any of the
terms, provisions and covenants of the subordinated notes or the agreement under
which they are issued, regardless of any knowledge thereof that any such holder
of Superior Indebtedness may have or be otherwise charged with.
(e) The subordination effected by the foregoing provisions and the
rights created thereby of the holders of the Superior Indebtedness shall not be
affected by: (1) any amendment of or addition or supplement to any Superior
Indebtedness or any instrument or agreement relating thereto, (2) any exercise
or non-exercise of any right, power or remedy under or in respect of any
Superior Indebtedness or any instrument or agreement relating thereto, or (3)
the giving or denial of any waiver, consent, release, indulgence, extension,
renewal, modification or delay or the taking or nontaking of any other action,
inaction or omission, in respect of any Superior Indebtedness or any instrument
or agreement relating thereto or to any securities relating thereto or any
guarantee thereof, whether or not any holder of any subordinated notes shall
have had notice or knowledge of any of the foregoing.
(f) The Company agrees, for the benefit of the holders of Superior
Indebtedness, that in the event that any subordinated note is declared due and
payable before its expressed maturity because of the occurrence of a default
hereunder: (1) the Company will give prompt notice in writing of such happening
to the holders of Superior Indebtedness and (2) all Superior Indebtedness shall
forthwith become immediately due and payable upon demand, regardless of the
expressed maturity thereof and (3) the holders of such subordinated notes shall
not entitled to receive any payment or distribution in respect thereof or
applicable thereto until all Superior Indebtedness at the time outstanding shall
have been indefeasibly paid in full in cash.
(g) No holder of any subordinated notes will sell, assign, pledge,
encumber or otherwise dispose of any of its subordinated notes unless such sale,
assignment, pledge, encumbrance or disposition is made expressly subject to the
foregoing provisions.
(h) If any payment or distribution of any character, whether in cash,
securities or other property shall be received by any holder of any subordinated
notes in contravention of this Section ________, such payment or distribution
shall be received and held in trust for the benefit of, and shall be promptly
paid over or delivered and transferred in the form received to, the holders of
the Superior Indebtedness pro rata for application to the payment of all
Superior Indebtedness remaining unpaid, to the extent necessary to indefeasibly
pay all such Superior Indebtedness in full in cash. In the event of the failure
of any holder of the subordinated notes to endorse or assign any such payment,
distribution or security, any holder of the Superior Indebtedness or such
holder's representative is hereby irrevocably authorized to endorse or assign
the same.