EXECUTION COPY
FERRELLGAS PARTNERS, L.P.
FERRELLGAS PARTNERS FINANCE CORP.
Obligors
FERRELLGAS, L.P.
Guarantor
$160,000,000 9 3/8% SENIOR SECURED NOTES
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INDENTURE
Dated as of April 26, 1996
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AMERICAN BANK NATIONAL ASSOCIATION
Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310 (a)(1)............................................................... 7.10
(a)(2).............................................................. 7.10
(a)(3).............................................................. N.A.
(a)(4).............................................................. N.A.
(a)(5).............................................................. 7.10
(b) ................................................................ 7.10
(c) ................................................................ N.A.
311 (a) ................................................................. 7.11
(b) ................................................................ 7.11
(c) ................................................................ N.A.
312 (a).................................................................. 2.05
(b)................................................................. 13.03
(c) ................................................................ 13.03
313 (a) ................................................................. 7.06
(b)(1).............................................................. 10.03
(b)(2).............................................................. 7.06
(c) .......................................................... 7.06;13.02
(d)................................................................. 7.06
314 (a) ............................................................ 4.03;13.05
(b) ................................................................ 10.02
(c)(1) ............................................................ 13.04
(c)(2) ............................................................ 13.04
(c)(3)............................................................. N.A.
(d).......................................................... 10.03-10.05
(e)................................................................ 13.05
(f)................................................................ N.A.
315 (a)................................................................. 7.01
(b).............................................................7.05,13.02
(c)................................................................ 7.01
(d)................................................................ 7.01
(e)................................................................ 6.11
316 (a)(last sentence) ................................................. 2.09
(a)(1)(A).......................................................... 6.05
(a)(1)(B) ......................................................... 6.04
(a)(2) ............................................................ N.A.
(b) ............................................................... 6.07
(c) ............................................................... 2.13
317 (a)(1).............................................................. 6.08
(a)(2)............................................................. 6.09
(b) ............................................................... 2.04
318 (a)................................................................. 13.01
(b)................................................................ N.A.
(c)................................................................ 13.01
N.A. means not applicable.
*This Cross-Reference Table is not part of this Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions..................................... 1
Section 1.02. Other Definitions............................... 14
Section 1.03. Incorporation by Reference of Trust Indenture
Act............................................. 14
Section 1.04. Rules of Construction........................... 15
ARTICLE 2
THE SENIOR NOTES
Section 2.01. Form and Dating................................. 15
Section 2.02. Execution and Authentication.................... 16
Section 2.03. Registrar and Paying Agent...................... 16
Section 2.04. Paying Agent to Hold Money in Trust............. 17
Section 2.05. Lists of Holders of the Senior Notes............ 17
Section 2.06. Transfer and Exchange........................... 17
Section 2.07. Replacement Senior Notes........................ 23
Section 2.08. Outstanding Senior Notes........................ 23
Section 2.09. Treasury Senior Notes........................... 23
Section 2.10. Temporary Senior Notes.......................... 24
Section 2.11. Cancellation.................................... 24
Section 2.12. Defaulted Interest.............................. 24
Section 2.13. Record Date..................................... 24
Section 2.14. CUSIP Number.................................... 25
ARTICLE 3
REDEMPTION AND OFFERS TO PURCHASE
Section 3.01. Notices to Trustee.............................. 25
Section 3.02. Selection of Senior Notes to Be Purchased or
Redeemed........................................ 25
Section 3.03. Notice of Redemption............................ 26
Section 3.04. Effect of Notice of Redemption.................. 27
Section 3.05. Deposit of Redemption Price..................... 27
Section 3.06. Senior Notes Redeemed in Part................... 27
Section 3.07. Optional Redemption............................. 27
Section 3.08. Mandatory Redemption............................ 27
Section 3.09. Asset Sale Offers............................... 27
ARTICLE 4
COVENANTS
Section 4.01. Payment of Senior Notes......................... 29
Section 4.02. Maintenance of Office or Agency................. 29
Section 4.03. Reports......................................... 30
Section 4.04. Compliance Certificate.......................... 30
Section 4.05. Taxes........................................... 31
Section 4.06. Stay, Extension and Usury Laws.................. 31
i
Section 4.07. Restricted Payments............................. 31
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries.................................... 33
Section 4.09. Incurrence of Indebtedness and Issuance of
Disqualified Interests.......................... 33
Section 4.10. Asset Sales..................................... 35
Section 4.11. Transactions with Affiliates.................... 36
Section 4.12. Liens........................................... 37
Section 4.13. Limitations on Subsidiary Structure............. 37
Section 4.14. Offer to Purchase Upon Change of Control........ 37
Section 4.15. Partnership or Corporate Existence.............. 38
Section 4.16. Line of Business................................ 39
Section 4.17. Limitation on Sale and Leaseback Transactions... 39
Section 4.18. Restrictions on Nature of Indebtedness and
Activities of Finance Corp...................... 39
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets........ 39
Section 5.02. Successor Person Substituted.................... 40
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default............................... 41
Section 6.02. Acceleration.................................... 43
Section 6.03. Other Remedies.................................. 43
Section 6.04. Waiver of Past Defaults......................... 43
Section 6.05. Control by Majority............................. 44
Section 6.06. Limitation on Suits............................. 44
Section 6.07. Rights of Holders of Senior Notes to Receive
Payment......................................... 44
Section 6.08. Collection Suit by Trustee...................... 45
Section 6.09. Trustee May File Proofs of Claim................ 45
Section 6.10. Priorities...................................... 45
Section 6.11. Undertaking for Costs........................... 46
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee............................... 46
Section 7.02. Rights of Trustee............................... 47
Section 7.03. Individual Rights of Trustee.................... 47
Section 7.04. Trustee's Disclaimer............................ 48
Section 7.05. Notice of Defaults.............................. 48
Section 7.06. Reports by Trustee to Holders of the Senior
Notes............................................48
Section 7.07. Compensation and Indemnity...................... 48
Section 7.08. Replacement of Trustee.......................... 49
Section 7.09. Successor Trustee by Merger, etc................ 50
Section 7.10. Eligibility; Disqualification................... 50
Section 7.11. Preferential Collection of Claims Against
Issuers......................................... 50
ii
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant
Defeasance...................................... 51
Section 8.02. Legal Defeasance and Discharge.................. 51
Section 8.03. Covenant Defeasance............................. 51
Section 8.04. Conditions to Legal or Covenant Defeasance...... 52
Section 8.05. Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous Provisions... 53
Section 8.06. Repayment to Issuers............................ 54
Section 8.07. Reinstatement................................... 54
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Senior Notes...... 54
Section 9.02. With Consent of Holders of Senior Notes......... 55
Section 9.03. Compliance with Trust Indenture Act............. 56
Section 9.04. Revocation and Effect of Consents............... 56
Section 9.05. Notation on or Exchange of Senior Notes......... 57
Section 9.06. Trustee to Sign Amendments, etc................. 57
ARTICLE 10
COLLATERAL AND SECURITY
Section 10.01. Pledge Agreement................................ 57
Section 10.02. Recording and Opinions.......................... 58
Section 10.03. Release of Collateral........................... 58
Section 10.04. Certificates of the Issuers..................... 59
Section 10.05. Certificates of the Trustee..................... 59
Section 10.06. Authorization of Actions to Be Taken by the
Trustee Under the Pledge Agreement.............. 59
Section 10.07. Authorization of Receipt of Funds by the Trustee
Under the Pledge Agreement...................... 60
Section 10.08. Termination of Security Interest................ 60
ARTICLE 11
SUBORDINATION OF SUBSIDIARY GUARANTEE
Section 11.01. Subsidiary Guarantee Obligations Subordinated to
Senior Operating Partnership Indebtedness....... 60
Section 11.02. Subordination of Subsidiary Guarantee Upon
Insolvency or Liquidation Proceedings........... 60
Section 11.03. No Payment on Subsidiary Guarantee Obligations in
Certain Circumstances........................... 62
Section 11.04. Subrogation to Rights of Holders of Senior
Operating Partnership Indebtedness.............. 63
Section 11.05. Effectuation of Subordination of Subsidiary
Guarantee....................................... 63
Section 11.06. No Waiver of Subordination Provisions........... 64
Section 11.07. Reliance on Court Orders; Evidence of Status.... 65
Section 11.08. Payment......................................... 65
Section 11.09. Relative Rights................................. 65
iii
Section 11.10. Restrictions on Payments of Principal........... 66
ARTICLE 12
SUBSIDIARY GUARANTEE
Section 12.01. Subsidiary Guarantee............................ 66
Section 12.02. Execution and Delivery of Subsidiary Guarantee.. 67
Section 12.03. Guarantor May Consolidate, etc., on Certain
Terms........................................... 67
Section 12.04. Release of Subsidiary Guarantee................. 68
Section 12.05. Limitation on Guarantor Liability............... 69
Section 12.06. "Trustee" to Include Paying Agent............... 69
Section 12.07. Subordination of Subsidiary Guarantee........... 69
ARTICLE 13
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls.................... 70
Section 13.02. Notices......................................... 70
Section 13.03. Communication by Holders of Senior Notes with
Other Holders of Senior Notes................... 71
Section 13.04. Certificate and Opinion as to Conditions
Precedent....................................... 71
Section 13.05. Statements Required in Certificate or Opinion... 71
Section 13.06. Rules by Trustee and Agents..................... 72
Section 13.07. No Personal Liability of Limited Partners,
Directors, Officers, Employees and Stockholders. 72
Section 13.08. Governing Law................................... 72
Section 13.09. No Adverse Interpretation of Other Agreements... 72
Section 13.10. Successors...................................... 72
Section 13.11. Severability.................................... 72
Section 13.12. Counterpart Originals........................... 72
Section 13.13. Table of Contents, Headings, etc................ 72
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EXHIBITS
Exhibit A FORM OF SENIOR NOTE
Exhibit B CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SENIOR NOTES
Exhibit C FORM OF SUBSIDIARY GUARANTEE
v
INDENTURE dated as of April 26, 1996, among Ferrellgas Partners,
L.P., a Delaware limited partnership (the "Partnership"), Ferrellgas Partners
Finance Corp., a Delaware corporation ("Finance Corp." and, together with the
Partnership, the "Issuers"), Ferrellgas, L.P., a Delaware limited partnership
(the "Operating Partnership"), and American Bank National Association, as
trustee (the "Trustee").
The Partnership, Finance Corp., the Operating Partnership and the
Trustee agree as follows for the benefit of each other and for the equal and
ratable benefit of the Holders of the 93/8% Series A Senior Secured Notes due
2006 (the "Series A Senior Notes") and the 93/8% Series B Senior Secured Notes
due 2006 (the "Series B Senior Notes" and, together with the Series A Senior
Notes, the "Senior Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01. DEFINITIONS.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person merged
with or into or became a Subsidiary of such specified Person, including
Indebtedness incurred in connection with, or in contemplation of, such other
Person merging with or into or becoming a Subsidiary of such specified Person
and (ii) Indebtedness encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided, however,
that beneficial ownership of 10% or more of the voting securities of a Person
shall be deemed to be control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Attributable Debt" means, in respect of a sale and leaseback
arrangement of any property, as at the time of determination, the present value
(calculated using a discount rate equal to the interest rate of the Senior Notes
and annual compounding) of the total obligations of the lessee for rental
payments during the remaining term of the lease included in such arrangement
(including any period for which such lease has been extended).
"Available Cash" has the meaning given to such term in the
Partnership Agreement, as amended to the date of the Indenture.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Board of Directors" means the Board of Directors of the General
Partner, or any authorized committee of the Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on the balance sheet in
accordance with GAAP.
"Capital Interests" means any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock, including, without limitation, with respect to partnerships, partnership
interests (whether general or limited) and any other interest or participation
that confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, such partnership.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than eighteen months from the date of acquisition, (iii) certificates of
deposit and eurodollar time deposits with maturities of six months or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any lender party to the
Credit Facility or with any domestic commercial bank having capital and surplus
in excess of $500 million and a Keefe Bank Watch Rating of "B" or better, (iv)
repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clauses (ii) and (iii) entered into with
any financial institution meeting the qualifications specified in clause (iii)
above, (v) commercial paper having the highest rating obtainable from Moody's
Investors Service, Inc. or Standard & Poor's Corporation and in each case
maturing within nine months after the date of acquisition and (vi) investments
in money market funds all of whose assets consist of securities of the types
described in the foregoing clauses (i) through (v).
"Certificated Securities" shall mean Senior Notes that are in the
form of the Senior Notes attached hereto as Exhibit A, that do not include the
information called for by footnotes 1 and 2 thereof.
"Change of Control" means (i) the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Partnership or the
Operating Partnership to any Person or group (as such term is used in Section
13(d)(3) of the Exchange Act) other than James E. Ferrell, the Related Parties
and any Person of which James E. Ferrell and the Related Parties beneficially
own in the aggregate 51% or more of the voting Capital Interests (or if such
Person is a partnership, 51% or more of the general partner interests), (ii) the
liquidation or dissolution of the Partnership, the Operating Partnership or the
General Partner, (iii) the occurrence of any transaction, the result of which is
that James E. Ferrell and the Related Parties beneficially own in the aggregate,
directly or indirectly, less than 51% of the total voting power entitled to vote
for the election of directors of the General Partner, (iv) the occurrence of any
transaction, the result of which is that the General Partner is no longer the
sole general partner of the Partnership or the Operating Partnership and (v) the
first day on which the Partnership fails to own 100% of the issued and
outstanding Equity Interests of Finance Corp.
"Collateral Agent" shall have the meaning set forth in the Pledge
Agreement.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus (a) an
amount equal to any extraordinary loss plus any net loss realized in connection
with an asset sale (to the extent such losses were deducted in computing
Consolidated Net Income), plus (b) provision for taxes based on income or
profits of such Person for such period, to the extent such provision for taxes
was deducted in computing Consolidated Net Income, plus (c) consolidated
interest expense of such Person for such period, whether paid or accrued
(including amortization of original issue discount, non-cash interest payments
and the interest component of any
2
payments associated with Capital Lease Obligations and net payments (if any)
pursuant to Hedging Obligations), to the extent such expense was deducted in
computing Consolidated Net Income, plus (d) depreciation and amortization
(including amortization of goodwill and other intangibles but excluding
amortization of prepaid cash expenses that were paid in a prior period) of such
Person for such period to the extent such depreciation and amortization were
deducted in computing Consolidated Net Income, in each case, for such period
without duplication on a consolidated basis and determined in accordance with
GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided, that (i) the Net Income of any Person that is not a Subsidiary or that
is accounted for by the equity method of accounting shall be included only to
the extent of the amount of dividends or distributions paid to the referent
Person or a Wholly Owned Subsidiary thereof, (ii) the Net Income of any Person
that is a Subsidiary (other than a Wholly Owned Subsidiary) shall be included
only to the extent of the amount of dividends or distributions paid to the
referent Person or a Wholly Owned Subsidiary thereof, (iii) the Net Income of
any Person acquired in a pooling of interests transaction for any period prior
to the date of such acquisition shall be excluded (except to the extent
otherwise includable under clause (i) above) and (iv) the cumulative effect of a
change in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common stockholders of such
Person and its consolidated Subsidiaries as of such date plus (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Interests)
that by its terms is not entitled to the payment of dividends unless such
dividends may be declared and paid only out of net earnings in respect of the
year of such declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock, less (x) all
write-ups (other than write-ups resulting from foreign currency translations and
write-ups of tangible assets of a going concern business made within 12 months
after the acquisition of such business) subsequent to the date of this Indenture
in the book value of any asset owned by such Person or a consolidated Subsidiary
of such Person, (y) all investments as of such date in unconsolidated
Subsidiaries and in Persons that are not Subsidiaries (except, in each case,
Permitted Investments), and (z) all unamortized debt discount and expense and
unamortized deferred charges as of such date, all of the foregoing determined in
accordance with GAAP.
"Corporate Trust Office of the Trustee" shall be at the address of
the Trustee specified in Section 13.02 hereof or such other address as to which
the Trustee may give notice to the Partnership.
"Credit Facility" means the credit facility under that certain Credit
Agreement, dated as of July 5, 1994, as amended, by and among the Operating
Partnership, the Insurance Company Subsidiary, the General Partner and Bank of
America National Trust and Savings Association, as agent for the financial
institutions listed therein, providing for up to $205.0 million of credit
borrowings and letters of credit, including any related notes, instruments and
agreements executed in connection therewith, and in each case as amended,
modified, renewed, refunded, replaced or refinanced from time to time.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
3
"Depositary" means, with respect to the Senior Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Senior Notes, until a successor
shall have been appointed and become such pursuant to the applicable provision
of this Indenture, and, thereafter, "Depositary" shall mean or include such
successor.
"Disqualified Interests" means any Capital Interests which, by their
terms (or by the terms of any security into which they are convertible or for
which they are exchangeable), or upon the happening of any event, mature or are
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the Holder thereof, in whole or in part, on or prior
to the maturity date of the Senior Notes.
"Equity Interests" means Capital Interests and all warrants, options
or other rights to acquire Capital Interests (but excluding any debt security
that is convertible into, or exchangeable for, Capital Interests).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" means the offer that may be made by the Issuers
pursuant to the Registration Rights Agreement to exchange Series B Senior Notes
for Series A Senior Notes.
"Existing Indebtedness" means the Fixed Rate Notes, the Floating Rate
Notes and up to $5 million in aggregate principal amount of all other
Indebtedness of the Partnership and its Subsidiaries (other than under the
Credit Facility) in existence on the date of this Indenture, until such amounts
are repaid.
"Finance Corp." means the party named as such in this Indenture until
a successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Finance Corps." means Finance Corp. and the OLP Finance Corp.
"Fixed Charge Coverage Ratio" means with respect to any Person for
any period, the ratio of the Consolidated Cash Flow of such Person for such
period to the Fixed Charges of such Person for such period. In the event that
the reference Person or any of its Subsidiaries incurs, assumes, guarantees,
redeems or repays any Indebtedness (other than revolving credit borrowings)
subsequent to the commencement of the period for which the Fixed Charge Coverage
Ratio is being calculated but prior to the date of the event for which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
to such incurrence, assumption, guarantee, redemption or repayment of
Indebtedness, as if the same had occurred at the beginning of the applicable
reference period. The foregoing calculation of the Fixed Charge Coverage Ratio
shall also give pro forma effect to acquisitions (including all mergers and
consolidations), dispositions and discontinuance of businesses or assets that
have been made by the reference Person or any of its Subsidiaries during the
reference period or subsequent to such reference period and on or prior to the
Calculation Date assuming that all such acquisitions, dispositions and
discontinuance of businesses or assets had occurred on the first day of the
reference period; provided, however, that (a) Fixed Charges shall be reduced by
amounts attributable to businesses or assets that are so disposed of or
discontinued only to the extent that the obligations giving rise to such Fixed
Charges would no longer be obligations contributing to the Partnership's Fixed
Charges subsequent to the Calculation Date and (b) Consolidated Cash Flow
generated by an acquired business or asset shall be determined by the actual
gross profit (revenues minus cost of goods sold) of such acquired business or
4
asset during the immediately preceding number of full fiscal quarters as in the
reference period minus the pro forma expenses that would have been incurred by
the Partnership in the operation of such acquired business or asset during such
period computed on the basis of (i) personnel expenses for employees retained by
the Partnership in the operation of the acquired business or asset and (ii) non-
personnel costs and expenses incurred by the Partnership on a per gallon basis
in the operation of the Partnership's business at similarly situated Partnership
facilities. If the applicable reference period for any calculation of the Fixed
Charge Coverage Ratio with respect to the Partnership shall include a portion
prior to the date of this Indenture, then such Fixed Charge Coverage Ratio shall
be calculated based upon the Consolidated Cash Flow and the Fixed Charges of the
General Partner for such portion of the reference period prior to the date of
this Indenture and the Consolidated Cash Flow and the Fixed Charges of the
Partnership for the remaining portion of the reference period on and after the
date of this Indenture, giving pro forma effect, as described in the two
foregoing sentences, to all applicable transactions occurring on the date of
this Indenture or otherwise.
"Fixed Charges" means, with respect to any Person for any period, the
sum, without duplication, of (a) consolidated interest expense of such person
for such period, whether paid or accrued, to the extent such expense was
deducted in computing Consolidated Net Income (including amortization of
original issue discount, non-cash interest payments, the interest component of
all payments associated with Capital Lease Obligations and net payments (if any)
pursuant to Hedging Obligations), (b) commissions, discounts and other fees and
charges incurred with respect to letters of credit and bankers' acceptances
financing, (c) any interest expense on Indebtedness of another Person that is
Guaranteed by such Person or secured by a Lien on assets of such Person, and (d)
the product of (i) all cash dividend payments (and non-cash dividend payments in
the case of a Person that is a Subsidiary) on any series of preferred stock of
such Person, times (ii) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined federal, state and
local statutory tax rate of such Person, expressed as a decimal, determined, in
each case, on a consolidated basis and in accordance with GAAP.
"Fixed Rate Notes" means the $200 million 10% Fixed Rate Senior Notes
due 2001 of the Operating Partnership.
"Floating Rate Notes" means the $50 million Floating Rate Senior
Notes due 2001 of the Operating Partnership.
"Flow-Through Acquisition" means an acquisition by the General
Partner or its parent from a Person that is not an Affiliate of the General
Partner, its parent or the Partnership, of property (real or personal), assets
or equipment (whether through the direct purchase of assets or the Capital
Interests of the Person owning such assets) in the same line of business as the
Partnership and its Subsidiaries are engaged in on the date of this Indenture,
which is promptly sold, transferred or contributed by the General Partner or its
parent to the Partnership or one of its Subsidiaries.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect in the United States on the
date of this Indenture.
"General Partner" means Ferrellgas, Inc., a Delaware corporation and
the sole general partner of the Partnership and the Operating Partnership.
5
"Global Note" means a Senior Note that contains the paragraph
referred to in footnote 1 and the additional schedule referred to in footnote 2
to the form of the Senior Note attached hereto as Exhibit A.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States of America is
pledged.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"Guarantor" means the Operating Partnership and its successors and
assigns, or any other Subsidiary of the Partnership that Guarantees the Issuers'
Obligations under the Senior Notes and the Indenture pursuant to a form of
Guarantee and a supplemental indenture, in form and substance satisfactory to
the Trustee.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means a Person in whose name a Senior Note is registered.
"Indebtedness" means, with respect to any Person, any indebtedness of
such Person, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or representing Capital
Lease Obligations or the balance deferred and unpaid of the purchase price of
any property or representing any Hedging Obligations, except any such balance
that constitutes an accrued expense or trade payable, if and to the extent any
of the foregoing indebtedness (other than letters of credit and Hedging
Obligations) would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP, as well as all indebtedness of other Persons
secured by a Lien on any asset of such Person (whether or not such indebtedness
is assumed by such Person) and, to the extent not otherwise included, the
Guarantee by such Person of any Indebtedness of any other Person.
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Insurance Company Subsidiary" means Stratton Insurance Company, a
Vermont corporation, a Wholly Owned Subsidiary of the Operating Partnership.
"Insolvency or Liquidation Proceedings" means (i) any insolvency or
bankruptcy case or proceeding (including any case under the Bankruptcy Law), or
any receivership, liquidation, reorganization or other similar case or
proceeding, relative to the Operating Partnership, as such, or to its assets, or
(ii) any liquidation, dissolution, reorganization or winding up of the Operating
Partnership, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (iii) any assignment for the benefit of creditors
or any other marshalling of assets and liabilities of the Operating Partnership.
6
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of loans
(including Guarantees), advances or capital contributions (excluding commission,
travel and similar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities and all other items that are
or would be classified as investments on a balance sheet prepared in accordance
with GAAP.
"Issuers" means the parties named as such in this Indenture until a
successor replaces any such Issuer pursuant to this Indenture and thereafter
means the remaining Issuer and the successor.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing pursuant
to Section 5 of the Registration Rights Agreement.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (a) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (i) any asset sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions), or (ii)
the disposition of any securities or the extinguishment of any Indebtedness of
such Person or any of its Subsidiaries, and (b) any extraordinary gain (but not
loss), together with any related provision for taxes on such extraordinary gain
(but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Partnership or any of its Subsidiaries in respect of any Asset Sale, net of the
direct costs relating to such Asset Sale (including, without limitation, legal,
accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), amounts required to be applied to
the repayment of Indebtedness secured by a Lien on the asset or assets the
subject of such Asset Sale and any reserve for adjustment in respect of the sale
price of such asset or assets.
"Non-Recourse Subsidiary" means (1) the Insurance Company Subsidiary
and (2) any other Person (other than the Operating Partnership and Finance
Corps.) that would otherwise be a Subsidiary of the Partnership but is
designated as a Non-Recourse Subsidiary in a resolution of the Board of
Directors of the General Partner, so long as (a) no portion of the Indebtedness
or any other obligation (contingent or otherwise) of such Person (i) is
guaranteed by the Partnership or any of its Subsidiaries, (ii) is recourse or
obligates the Partnership or any of its Subsidiaries in any way or (iii)
subjects any property or asset of the Partnership or any of its Subsidiaries,
directly or indirectly, contingently or
7
otherwise, to satisfaction thereof, (b) neither the Partnership nor any of its
Subsidiaries has any contract, agreement, arrangement or understanding or is
subject to an obligation of any kind, written or oral, with such Person other
than on terms no less favorable to the Partnership and its Subsidiaries than
those that might be obtained at the time from persons who are not Affiliates of
the Partnership, (c) neither the Partnership nor any of its Subsidiaries has any
obligation with respect to such Person (i) to subscribe for additional shares of
capital stock, Capital Interests or other Equity Interests therein or (ii)
maintain or preserve such Person's financial condition or to cause such Person
to achieve certain levels of operating or other financial results, and (d) such
Person has no more than $1,000 of assets at the time of such designation.
"Note Custodian" means the Trustee, as custodian with respect to the
Senior Notes in global form, or any successor entity thereto.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Senior Notes by the Issuers.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person; provided,
however, that any reference to an Officer with respect to the Partnership shall
mean the respective Officer of the General Partner.
"Officers' Certificate" means a certificate signed on behalf of (i)
the General Partner (acting on behalf of the Partnership) by two Officers of the
General Partner, one of whom must be the principal executive officer, the
principal financial officer, the treasurer or the principal accounting officer
of the General Partner, or (ii) Finance Corp. by two Officers of Finance Corp.,
one of whom must be the principal executive officer, the principal financial
officer, the treasurer or the principal accounting officer of Finance Corp., in
either case that meets the requirements of Section 13.05 hereof.
"OLP Finance Corp." means Ferrellgas Finance Corp., a Delaware
corporation.
"Operating Partnership" means the party named as such in this
Indenture until a successor replaces it pursuant to this Indenture and
thereafter means the successor.
"Operating Partnership Indenture" means the indenture among the
Operating Partnership, OLP Finance Corp. and Norwest Bank, Minnesota, National
Association, as trustee, governing the Fixed Rate Notes and the Floating Rate
Notes as in existence from time to time.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
13.05 hereof. The counsel may be an employee of or counsel to the Partnership,
the General Partner, Finance Corp., the Operating Partnership, any of their
respective Subsidiaries or the Trustee.
"Partnership Agreement" means the Agreement of Limited Partnership of
Ferrellgas Partners, L.P., dated as of July 5, 1994, as amended, between
Ferrellgas, Inc. and the other parties who are signatories thereto.
8
"Partnership" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Permitted Investments" means (a) any Investments in Cash
Equivalents; (b) any Investments in the Partnership or in the Operating
Partnership; (c) Investments by the Partnership or any Subsidiary of the
Partnership in a Person, if as a result of such Investment such Person is
merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Partnership or
the Operating Partnership; and (d) other Investments in Non-Recourse
Subsidiaries of the Partnership that do not exceed $30 million at any time
outstanding; provided that in any transfer of assets to a Non-Recourse
Subsidiary by the Partnership or one of its Subsidiaries pursuant to the terms
of this Indenture, which assets were acquired in a Flow-Through Acquisition, the
dollar amount equal to the purchase price paid or Indebtedness assumed by such
Non-Recourse Subsidiary for such assets will not be deemed an Investment by the
Partnership or its Subsidiaries in such Non-Recourse Subsidiary for purposes of
this definition.
"Permitted Liens" means (a) Liens existing on the date of this
Indenture; (b) Liens in favor of the Issuers or Liens to secure Indebtedness of
a Subsidiary of the Partnership to the Partnership or a Wholly Owned Subsidiary
of the Partnership; (c) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Partnership or any Subsidiary of
the Partnership, provided that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend to any assets
other than those of the Person merged into or consolidated with the Partnership;
(d) Liens on property existing at the time of acquisition thereof by the
Partnership or any Subsidiary of the Partnership, provided that such Liens were
in existence prior to the contemplation of such acquisition; (e) Liens on any
property or asset acquired by the Partnership or any of its Subsidiaries in
favor of the seller of such property or asset and construction mortgages on
property, in each case, created within six months after the date of acquisition,
construction or improvement of such property or asset by the Partnership or such
Subsidiary to secure the purchase price or other obligation of the Partnership
or such Subsidiary to the seller of such property or asset or the construction
or improvement cost of such property in an amount up to 80% of the total cost of
the acquisition, construction or improvement of such property or asset; provided
that in each case, such Lien does not extend to any other property or asset of
the Partnership and its Subsidiaries; (f) Liens incurred or pledges and deposits
made in connection with worker's compensation, unemployment insurance and other
social security benefits and Liens to secure the performance of statutory
obligations, surety or appeal bonds, performance bonds or other obligations of a
like nature, in each case, incurred in the ordinary course of business; (g)
Liens for taxes, assessments or governmental charges or claims that are not yet
delinquent or that are being contested in good faith by appropriate proceedings
promptly instituted and diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; (h) Liens imposed by law, such as mechanics', carriers',
warehousemen's, materialmen's, and vendors' Liens, incurred in good faith in the
ordinary course of business with respect to amounts not yet delinquent or being
contested in good faith by appropriate proceedings if a reserve or other
appropriate provisions, if any, as shall be required by GAAP shall have been
made therefor; (i) zoning restrictions, easements, licenses, covenants,
reservations, restrictions on the use of real property or minor irregularities
of title incident thereto that do not, in the aggregate, materially detract from
the value of the property or the assets of the Partnership or impair the use of
such property in the operation of the business of the Partnership or any of its
Subsidiaries; (j) Liens of landlords or mortgages of landlords, arising solely
by operation of law, on fixtures and movable property located on premises leased
by the Partnership or any of its Subsidiaries in the ordinary course of
business; (k) financing statements granted with respect to personal property
leased by the Partnership and its Subsidiaries pursuant to leases considered
operating leases in accordance with GAAP, provided that such financing
statements are granted solely in connection
9
with such leases; (l) judgment Liens to the extent that such judgments do not
cause or constitute a Default or an Event of Default; (m) Liens incurred in the
ordinary course of business of the Partnership or any Subsidiary of the
Partnership with respect to obligations that do not exceed $5 million in the
aggregate in any one time outstanding and that (i) are not incurred in
connection with the borrowing of money or the obtaining of advances or credit
(other than trade credit in the ordinary course of business) and (ii) do not in
the aggregate materially detract from the value of the property or materially
impair the use thereof in the operation of business by the Partnership or such
Subsidiary; (n) Liens securing Indebtedness incurred to refinance Indebtedness
that has been secured by a Lien permitted under this Indenture; provided that
(i) any such Lien shall not extend to or cover any assets or property not
securing the Indebtedness so refinanced and (ii) the refinancing Indebtedness
secured by such Lien shall have been permitted to be incurred under Section 4.09
hereof and shall not have a principal amount in excess of the Indebtedness so
refinanced; (o) Liens in favor of the Senior Notes created pursuant to the terms
of the Pledge Agreement; (p) Liens on Capital Interests of the Operating
Partnership securing Indebtedness other than Subordinated Indebtedness that is
permitted to be incurred by the Partnership pursuant to the terms of this
Indenture; and (q) any extension or renewal, or successive extensions or
renewals, in whole or in part, of Liens permitted pursuant to the foregoing
clauses (a) through (p); provided that no such extension or renewal Lien shall
(i) secure more than the amount of Indebtedness or other obligations secured by
the Lien being so extended or renewed or (ii) extend to any property or assets
not subject to the Lien being so extended or renewed.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Partnership or any Subsidiary of the Partnership issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Partnership or any of its Subsidiaries
permitted to be incurred under this Indenture (other than Indebtedness under the
Credit Facility); provided that (a) the principal amount of such Indebtedness
does not exceed the principal amount of the Indebtedness so extended,
refinanced, renewed, replaced, defeased or refunded (plus the amount of
reasonable expenses incurred in connection therewith); (b) such Indebtedness has
a Weighted Average Life to Maturity equal to or greater than the Weighted
Average Life to Maturity of the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; (c) such Indebtedness is subordinated
in right of payment to the Senior Notes on terms at least as favorable to the
Holders of Senior Notes as those, if any, contained in the documentation
governing the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (d) such Indebtedness is incurred by the Partnership
or the Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Permitted Senior Refinancing Indebtedness" means Indebtedness of the
Operating Partnership permitted to be incurred pursuant to the terms of this
Indenture all the proceeds of which are used to repay or prepay the Senior
Operating Partnership Credit Agreement Obligations and other Senior Operating
Partnership Indebtedness.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof.
"Pledge Agreement" means the Pledge and Security Agreement, dated as
of April 26, 1996, by and among the Partnership, the General Partner and
American Bank National Association, as collateral agent, as such agreement may
be amended, modified or supplemented from time to time.
"Pledged Collateral" shall have the meaning set forth in the Pledge
Agreement.
10
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of April 26, 1996, by and among the Issuers, the Guarantor
and the other parties named on the signature pages thereof, as such agreement
may be amended, modified or supplemented from time to time.
"Related Party" means (i) the spouse or any lineal descendant of
James E. Ferrell, (ii) any trust for his benefit or for the benefit of his
spouse or any such lineal descendants or (iii) any corporation, partnership or
other entity in which James E. Ferrell and/or such other Persons referred to in
the foregoing clauses (i) and (ii) are the direct record and beneficial owners
of all of the voting and nonvoting Equity Interests.
"Responsible Officer" when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Agent" means Bank of America National Trust and Savings
Association, as agent or a lender under the Senior Operating Partnership Credit
Agreement, or any successor agent thereunder or under any agreement governing
Permitted Senior Refinancing Indebtedness or, in the absence of such agent, the
lender holding all or the greatest portion of the Indebtedness thereunder.
"Senior Operating Partnership Credit Agreement" means, collectively,
the Credit Agreement dated as of July 5, 1994, as amended by First Amendment to
Credit Agreement dated as of July 21, 1995 and a Second Amendment to Credit
Agreement dated as of October 20, 1995, in each case among the Operating
Partnership, Stratton Insurance Company, Inc., Ferrellgas, Inc., the lenders
referred to therein, Bank of America National Trust and Savings Association, as
agent for such lenders, and The First National Bank of Boston and Nationsbank of
Texas, N.A., as co-agents, and the other Loan Documents referred to in such
credit agreement, as all such agreements may be amended, restated, supplemented
or otherwise modified from time to time, and includes any agreement extending
the maturity of, or restructuring all or any portion of the Indebtedness of the
Operating Partnership under such agreements.
"Senior Operating Partnership Credit Agreement Notes" means the
Operating Partnership's promissory notes issued pursuant to the Senior Operating
Partnership Credit Agreement.
"Senior Operating Partnership Credit Agreement Obligations" means (i)
the "Obligations" as defined in the Senior Operating Partnership Credit
Agreement and (ii) all Permitted Senior Refinancing
Indebtedness.
"Senior Operating Partnership Indebtedness" means all Indebtedness
(other than Subordinated Indebtedness) and other obligations specified below
payable directly or indirectly by the Operating Partnership from time to time
outstanding, whether now existing or hereafter arising, fixed or contingent, due
or not due, liquidated or not liquidated, determined or undetermined:
11
(1) the principal of and interest on all loans, reimbursement
obligations and other extensions of credit under the Senior Operating
Partnership Credit Agreement, the Senior Operating Partnership Credit
Agreement Notes and any other agreement or instrument providing for,
evidencing or securing any Permitted Senior Refinancing Indebtedness or
any other loans, reimbursement obligations or extensions of credit by the
lender or lenders thereunder (including in each case any amendment,
renewal, supplement, extension, refinancing, restructuring, refunding or
other modification thereof) and all premiums, expenses, fees,
reimbursements, indemnities and other amounts owing by the Operating
Partnership pursuant to the Senior Operating Partnership Credit Agreement
and any such other agreement or instrument;
(2) all Indebtedness represented by the existing Fixed Rate
Notes and Floating Rate Notes; and
(3) all Indebtedness (other than Subordinated Indebtedness) of
the Operating Partnership permitted to be incurred under the Credit
Facility and the Operating Partnership Indenture, as each is in effect
from time to time and as the same may be extended, refinanced, renewed,
replaced, defeased or refunded.
All interest accrued on any Senior Operating Partnership Indebtedness, in
accordance with and at the contract rate specified in the agreement or
instrument creating, evidencing or governing such Senior Operating Partnership
Indebtedness, shall constitute Senior Operating Partnership Indebtedness for
periods both before and after the commencement of any Insolvency or Liquidation
Proceeding, even if the claim for such interest is not allowed pursuant to
applicable law. To the extent any payment of Senior Operating Partnership
Indebtedness (whether by or on behalf of the Issuers or the Operating
Partnership, as proceeds of security or enforcement of any right of setoff or
otherwise) is declared to be fraudulent or preferential, set aside or required
to be paid to a trustee, receiver or other similar party under any bankruptcy,
insolvency, receivership or similar law, then if such payment is recovered by,
or paid over to, such trustee, receiver or other similar party, the Senior
Operating Partnership Indebtedness or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred. Notwithstanding anything to the contrary in the foregoing,
Senior Operating Partnership Indebtedness shall not include (i) any liability
for federal, state, local or other taxes owed or owing by the Operating
Partnership (other than indemnities for taxes constituting Senior Operating
Partnership Credit Agreement Obligations), (ii) any Indebtedness of the
Operating Partnership to any of its Subsidiaries or other Affiliates, (iii) any
trade payables, (iv) any Indebtedness that is incurred in violation of this
Indenture, (v) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11, United States Code, is without
recourse to the Operating Partnership, (vi) any Indebtedness, Guarantee or
obligation of the Operating Partnership which is contractually subordinate in
right of payment to any other Indebtedness, Guarantee or obligation of the
Operating Partnership and (vii) Capital Interests.
"Significant Subsidiary" means any Subsidiary of the Partnership that
would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation
is in effect on the date hereof.
"Subordinated Indebtedness" means any Indebtedness of the Partnership
or any of its Subsidiaries which is expressly by its terms subordinated in right
of payment to any other Indebtedness.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Interests entitled (without
12
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof or, in the case of a partnership, more
than 50% of the partners' Capital Interests (considering all partners' Capital
Interests as a single class), is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person or a combination thereof. Notwithstanding the foregoing, any Subsidiary
of the Partnership that is designated a Non-Recourse Subsidiary pursuant to the
definition thereof shall not thereafter be deemed a Subsidiary of the
Partnership.
"Subsidiary Guarantee" means, from and after the Subsidiary Guarantee
Effectiveness Date, the Guarantee by the Operating Partnership of the
Obligations under the Indenture and the Senior Notes.
"Subsidiary Guarantee Effectiveness Date" means the first date upon
which the Operating Partnership is permitted pursuant to the Fixed Charge
Coverage Ratio tests contained in the Operating Partnership Indenture and the
Credit Facility and pursuant to the terms of any other Senior Operating
Partnership Indebtedness to Guarantee, on a senior subordinated basis as and to
the extent set forth in Article 11 of this Indenture, the Issuers' total payment
Obligations under all of the then-outstanding Senior Notes.
"Subsidiary Guarantee Obligations" means any and all obligations of
the Operating Partnership after the Subsidiary Guarantee Effectiveness Date for
the payment of principal, premium, if any, interest and Liquidated Damages, if
any, on the Senior Notes and the performance by it of its other agreements,
covenants and undertakings under or in respect of this Indenture, the Senior
Notes and the Subsidiary Guarantee.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"Transfer Restricted Securities" means securities that bear or are
required to bear the legend set forth in Section 2.06 hereof.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the sum
of the products obtained by multiplying (x) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (y) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (b) the then outstanding principal
amount of such Indebtedness; provided, however, that with respect to any
revolving Indebtedness, the foregoing calculation of Weighted Average Life to
Maturity shall be determined based upon the total available commitments and the
required reductions of commitments in lieu of the outstanding principal amount
and the required payments of principal, respectively.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person all of the outstanding Capital Interests or other ownership interests or,
in the case of a limited partnership, all of the partners' Capital Interests
(other than up to approximately 1% general partner interest), of which (other
than directors' qualifying shares) shall at the time be owned by such Person or
by one or more Wholly Owned Subsidiaries of such Person or by such Person and
one or more Wholly Owned Subsidiaries of such Person.
13
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
"Affiliate Transaction"........................... 4.11
"Asset Sale"...................................... 4.10
"Asset Sale Offer"................................ 3.09
"Change of Control Offer"......................... 4.14
"Change of Control Payment"....................... 4.14
"Change of Control Payment Date".................. 4.14
"Closing Date".................................... 2.01
"Covenant Defeasance"............................. 8.03
"Commencement Date"............................... 3.09
"Event of Default"................................ 6.01
"Excess Proceeds"................................. 4.10
"Global Note Holder".............................. 2.01
"incur"........................................... 4.09
"Incurrence Date"................................. 4.09
"Legal Defeasance" ............................... 8.02
"Offer Amount".................................... 3.09
"Offer Period".................................... 3.09
"Paying Agent".................................... 2.03
"Payment Default"................................. 6.01
"Purchase Date"................................... 3.09
"qualified institutional buyer"................... 2.06
"Registrar"....................................... 2.03
"Restricted Payments"............................. 4.07
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture,
other than those provisions of the TIA that may be excluded herein, which
provision shall be excluded to the extent specifically excluded in this
Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Senior Notes and the Subsidiary
Guarantee;
"indenture security holder" means a Holder of a Senior Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Senior Notes means the Issuers, the Guarantor and
any successor obligor upon the Senior Notes or the Subsidiary Guarantee, as the
case may be.
14
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by a rule or regulation
promulgated by the SEC under the TIA have the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act or
the Exchange Act shall be deemed to include substitute, replacement or
successor sections or rules adopted by the SEC from time to time.
ARTICLE 2
THE SENIOR NOTES
SECTION 2.01. FORM AND DATING.
The Senior Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A which is part of this Indenture
and shall be in a principal amount of no greater than $160,000,000. The Senior
Notes may have notations, legends or endorsements required by law, stock
exchange rule or usage which will be provided by the Issuers. Each Senior Note
shall be dated the date of its authentication. The Senior Notes shall be in
denominations of $1,000 and integral multiples thereof.
The Senior Notes shall be issued in the form of one Global Note. The
Global Note shall be deposited on the date of the closing of the sale of the
Senior Notes offered pursuant to the Offering (the "Closing Date") with, or on
behalf of the Depositary (such nominee being referred to herein as the "Global
Note Holder"). Except as set forth in Section 2.06, the Global Note may be
transferred, in whole and not in part, only to another nominee of the Depositary
or to a successor of the Depositary or its nominee.
The terms and provisions contained in the Senior Notes annexed hereto
as Exhibit A, and the Subsidiary Guarantee annexed hereto as Exhibit C shall
constitute, and are hereby expressly made, a part of this Indenture. To the
extent applicable, the Issuers, the Operating Partnership and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
15
Senior Notes issued in global form shall be substantially in the form
of Exhibit A attached hereto (including the text referred to in footnotes 1 and
2 thereto). Senior Notes issued in certificated form shall be substantially in
the form of Exhibit A attached hereto (but without including the text referred
to in footnotes 1 and 2 thereto). The Global Note shall represent such of the
outstanding Senior Notes as shall be specified therein and each shall provide
that it shall represent the aggregate amount of outstanding Senior Notes from
time to time endorsed thereon and that the aggregate amount of outstanding
Senior Notes represented thereby may from time to time be reduced or increased,
as appropriate, to reflect exchanges and redemptions. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in the amount of
outstanding Senior Notes represented thereby shall be made by the Trustee or the
Note Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
At least one Officer of each of the General Partner (in the case of
the Partnership) and Finance Corp. shall sign the Senior Notes for the Issuers
by manual or facsimile signature. The seal of each Issuer shall be reproduced on
the Senior Notes and may be in facsimile form.
If an Officer of the General Partner or Finance Corp. whose signature
is on a Senior Note no longer holds that office at the time the Senior Note is
authenticated, the Senior Note shall nevertheless be valid.
A Senior Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature of the Trustee shall be conclusive
evidence that the Senior Note has been authenticated under this Indenture. The
form of Trustee's certificate of authentication to be borne by the Senior Notes
shall be substantially as set forth in Exhibit A hereto.
The Trustee shall, upon a written order of the Issuers signed by an
Officer of the General Partner and Finance Corp., authenticate Senior Notes for
original issue up to an aggregate principal amount stated in paragraph 4 of the
Senior Notes. The aggregate principal amount of Senior Notes outstanding at any
time shall not exceed the amount set forth herein except as provided in Section
2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Senior Notes. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Senior Notes whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Partnership or Finance Corp. or an
Affiliate of the Partnership or Finance Corp.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Issuers shall maintain (i) an office or agency where Senior Notes
may be presented for registration of transfer or for exchange (including any
co-registrar, the "Registrar") and (ii) an office or agency where Senior Notes
may be presented for payment ("Paying Agent"). The Registrar shall keep a
register of the Senior Notes and of their transfer and exchange. The Issuers may
appoint one or more co-registrars and one or more additional paying agents. The
term "Paying Agent" includes any additional paying agent. The Issuers may change
any Paying Agent, Registrar or co-registrar without prior notice to any Holder
of a Senior Note. The Issuers shall notify the Trustee and the Trustee shall
notify the Holders of the Senior Notes of the name and address of any Agent not
a party to this Indenture. The
16
Partnership, Finance Corp. or the Guarantor may act as Paying Agent, Registrar
or co-registrar. The Issuers shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture, which shall be subject to any
obligations imposed by the provisions of the TIA. The agreement shall implement
the provisions of this Indenture that relate to such Agent. The Issuers shall
notify the Trustee of the name and address of any such Agent. If the Issuers
fail to maintain a Registrar or Paying Agent, or fails to give the foregoing
notice, the Trustee shall act as such, and shall be entitled to appropriate
compensation in accordance with Section 7.07 hereof.
The Issuers initially appoint The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Note.
The Issuers initially appoint the Trustee as Registrar, Paying Agent
and agent for service of notices and demands in connection with the Global Note.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Issuers shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
the Holders of the Senior Notes or the Trustee all money held by the Paying
Agent for the payment of principal of, premium, if any, and interest, including
Liquidated Damages, if any, on the Senior Notes, and shall notify the Trustee of
any Default by the Issuers or the Guarantor in making any such payment. While
any such Default continues, the Trustee may require a Paying Agent to pay all
money held by it to the Trustee. The Issuers at any time may require a Paying
Agent to pay all money held by it to the Trustee. Upon payment over to the
Trustee, the Paying Agent (if other than the Partnership, Finance Corp. or the
Guarantor) shall have no further liability for the money delivered to the
Trustee. If the Partnership, Finance Corp. or the Guarantor acts as Paying
Agent, it shall segregate and hold in a separate trust fund for the benefit of
the Holders of the Senior Notes all money held by it as Paying Agent. Upon any
bankruptcy or reorganization proceeding relating to the Partnership, Finance
Corp. or the Guarantor, the Trustee shall serve as Paying Agent for the Senior
Notes.
SECTION 2.05. LISTS OF HOLDERS OF THE SENIOR NOTES.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders of the Senior Notes and shall otherwise comply with TIA ss. 312(a). If
the Trustee is not the Registrar, the Issuers and/or the Guarantor shall furnish
to the Trustee at least seven Business Days before each interest payment date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee may reasonably require of the names and
addresses of Holders of the Senior Notes, including the aggregate principal
amount of the Senior Notes held by each thereof, and the Issuers and the
Guarantor shall otherwise comply with TIA ss. 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Certificated Securities. When
Certificated Securities are presented by a Holder to the Registrar with a
request:
(x) to register the transfer of the Certificated Securities; or
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(y) to exchange such Certificated Securities for an equal
principal amount of Certificated Securities of other
authorized denominations, the Registrar shall register
the transfer or make the exchange as requested if its
requirements for such transactions are met; provided,
however, that the Certificated Securities presented or
surrendered for register of transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the
Registrar duly executed by such Holder or by his
attorney, duly authorized in writing; and
(ii) in the case of a Certificated Security that is a
Transfer Restricted Security, such request shall be
accompanied by the following additional information
and documents, as applicable:
(A) if such Transfer Restricted Security is being
delivered to the Registrar by a Holder for
registration in the name of such Holder, without
transfer, a certification to that effect from
such Holder (in substantially the form of
Exhibit B hereto);
(B) if such Transfer Restricted Security is being
transferred to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities
Act) in accordance with Rule 144A under the
Securities Act or pursuant to an exemption from
registration in accordance with Rule 144 or Rule
904 under the Securities Act or pursuant to an
effective registration statement under the
Securities Act, a certification to that effect
from such Holder (in substantially the form of
Exhibit B hereto); or
(C) if such Transfer Restricted Security is being
transferred in reliance on another exemption
from the registration requirements of the
Securities Act, a certification to that effect
from such Holder (in substantially the form of
Exhibit B hereto) and an Opinion of Counsel from
such Holder or the transferee reasonably
acceptable to the Partnership and to the
Registrar to the effect that such transfer is in
compliance with the Securities Act.
(b) Transfer of a Certificated Security for a Beneficial Interest in
the Global Note. A Certificated Security may not be exchanged for a beneficial
interest in a Global Note except upon satisfaction of the requirements set forth
below. Upon receipt by the Trustee of a Certificated Security, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory to the
Trustee, together with:
(i) if such Certificated Security is a Transfer Restricted Security,
a certification from the Holder thereof (in substantially the
form of Exhibit B hereto) to the effect that such Certificated
Security is being transferred by such Holder to a "qualified
institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the
Securities Act; and
(ii) whether or not such Certificated Security is a Transfer
Restricted Security, written instructions from the Holder
thereof directing the Trustee to make, or to direct the Note
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Custodian to make, an endorsement on the Global Note to reflect
an increase in the aggregate principal amount of the Senior
Notes represented by the Global Note,
in which case the Trustee shall cancel such Certificated Security in accordance
with Section 2.11 hereof and cause, or direct the Note Custodian to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Note Custodian, the aggregate principal amount of Senior
Notes represented by the Global Note to be increased accordingly. If no Global
Note is then outstanding, the Issuers shall issue and, upon receipt of an
authentication order in accordance with Section 2.02 hereof, the Trustee shall
authenticate a new Global Note in the appropriate principal amount.
(c) Transfer and Exchange of Global Note. The transfer and exchange
of the Global Note or beneficial interests therein shall be effected through the
Depositary, in accordance with this Indenture and the procedures of the
Depositary therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act.
(d) Transfer of a Beneficial Interest in the Global Note for a
Certificated Security.
(i) Any Person having a beneficial interest in a Global Note
may upon request exchange such beneficial interest for a
Certificated Security. Upon receipt by the Trustee of
written instructions or such other form of instructions as
is customary for the Depositary, from the Depositary or
its nominee on behalf of any Person having a beneficial
interest in a Global Note, and, in the case of a Transfer
Restricted Security, the following additional information
and documents (all of which may be submitted by
facsimile):
(A) if such beneficial interest is being transferred
to the Person designated by the Depositary as
being the beneficial owner, a certification to
that effect from such Person (in substantially
the form of Exhibit B hereto);
(B) if such beneficial interest is being transferred
to a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) in
accordance with Rule 144A under the Securities
Act or pursuant to an exemption from
registration in accordance with Rule 144 or Rule
904 under the Securities Act or pursuant to an
effective registration statement under the
Securities Act, a certification to that effect
from the transferor (in substantially the form
of Exhibit B hereto); or
(C) if such beneficial interest is being transferred
in reliance on another exemption from the
registration requirements of the Securities Act,
a certification to that effect from the
transferor (in substantially the form of Exhibit
B hereto) and an Opinion of Counsel from the
transferee or transferor reasonably acceptable
to the Partnership and to the Registrar to the
effect that such transfer is in compliance with
the Securities Act,
in which case the Trustee or the Note Custodian, at the
direction of the Trustee, shall, in accordance with the
standing instructions and procedures existing between the
Depositary and the Note Custodian, cause the aggregate
principal amount of the Global Note to be reduced
accordingly and, following such reduction, the Partnership
shall execute and, upon receipt of an authentication order
in accordance with Section
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2.02 hereof, the Trustee shall authenticate and deliver to
the transferee a Certificated Security in the appropriate
principal amount.
(ii) Certificated Securities issued in exchange for a
beneficial interest in a Global Note pursuant to this
Section 2.06(d) shall be registered in such names and in
such authorized denominations as the Depositary, pursuant
to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Certificated Securities to the Persons
in whose names such Senior Notes are so registered.
(e) Restrictions on Transfer and Exchange of Global Note.
Notwithstanding any other provision of this Indenture (other than the provisions
set forth in subsection (f) of this Section 2.06), a Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
(f) Authentication of Certificated Securities in Absence of
Depositary. If at any time:
(i) the Depositary for the Senior Notes notifies the
Partnership that the Depositary is unwilling or unable to
continue as Depositary for a Global Note and a successor
Depositary for such Global Note is not appointed by the
Partnership within 90 days after delivery of such notice;
or
(ii) the Partnership, at its sole discretion, notifies the
Trustee in writing that it elects to cause the issuance of
Certificated Securities under this Indenture,
then the Issuers shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, Certificated Securities in an aggregate principal amount equal to the
principal amount of such Global Note in exchange for such Global Note.
(g) Legends.
(i) Except as permitted by the following paragraphs (ii) and
(iii), each Senior Note certificate evidencing the Global
Notes and Certificated Securities (and all Senior Notes
issued in exchange therefor or substitution thereof) shall
bear a legend in substantially the following form:
"THE SENIOR NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THE
SENIOR NOTE EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THE SENIOR NOTE EVIDENCED HEREBY IS HEREBY NOTIFIED THAT
THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER. THE HOLDER OF THE SENIOR NOTE
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUERS
THAT (A) SUCH SENIOR NOTE MAY BE RESOLD,
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PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) INSIDE THE
UNITED STATES TO A PERSON WHO THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
904 UNDER THE SECURITIES ACT OR (d) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL
IF THE ISSUERS SO REQUEST), (2) TO THE ISSUERS OR (3)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
FROM IT OF THE SENIOR NOTE EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security
represented by a Global Note) pursuant to Rule 144 under
the Securities Act or pursuant to an effective
registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Security that
is a Certificated Security, the Registrar shall
permit the Holder thereof to exchange such Transfer
Restricted Security for a Certificated Security that
does not bear the legend set forth in (i) above and
rescind any restriction on the transfer of such
Transfer Restricted Security; and
(B) in the case of any Transfer Restricted Security represented by a Global
Note, such Transfer Restricted Security shall not be required to bear the legend
set forth in (i) above, but shall continue to be subject to the provisions of
Section 2.06(c) hereof; provided, however, that with respect to any request for
an exchange of a Transfer Restricted Security that is represented by a Global
Note for a Certificated Security that does not bear the legend set forth in (i)
above, which request is made in reliance upon Rule 144, the Holder thereof shall
certify in writing to the Registrar that such request is being made pursuant to
Rule 144 (such certification to be substantially in the form of Exhibit B
hereto).
(iii) Notwithstanding the foregoing, upon consummation of the
Exchange Offer, the Issuers shall issue and, upon receipt
of an authentication order in accordance with Section 2.02
hereof, the Trustee shall authenticate Series B Senior
Notes in exchange for Series A Senior Notes accepted for
exchange in the Exchange Offer, which Series B Senior
Notes shall not bear the legend set forth in (i) above,
and the Registrar shall rescind any restriction on the
transfer of such Series A Senior Notes, in each case
unless the Holder of such Series A Senior Notes is either
(A) a broker-dealer, (B) a Person participating in the
distribution of the Series A Senior Notes or (C) a Person
who is an affiliate (as defined in Rule 144A) of the
Issuers.
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(h) Cancellation and/or Adjustment of Global Note. At such time as
all beneficial interests in a Global Note have been exchanged for Certificated
Securities, redeemed, repurchased or cancelled, such Global Note shall be
returned to or retained and cancelled by the Trustee in accordance with Section
2.11 hereof. At any time prior to such cancellation, if any beneficial interest
in a Global Note is exchanged for Certificated Securities, redeemed, repurchased
or cancelled, the principal amount of Senior Notes represented by such Global
Note shall be reduced accordingly and an endorsement shall be made on such
Global Note, by the Trustee or the Note Custodian, at the direction of the
Trustee, to reflect such reduction.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Issuers shall execute and the Trustee shall authenticate
Certificated Securities and the Global Note at the
Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Issuers
may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in
connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or
transfer pursuant to Sections 3.07, 4.10, 4.14 and 9.05
hereof).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Senior Note selected for
redemption in whole or in part, except the unredeemed
portion of any Senior Note being redeemed in part.
(iv) All Certificated Securities and the Global Note issued
upon any registration of transfer or exchange of
Certificated Securities or the Global Note shall be the
valid obligations of the Issuers, evidencing the same
debt, and entitled to the same benefits under this
Indenture, as the Certificated Securities or the Global
Note surrendered upon such registration of transfer or
exchange.
(v) The Issuers shall not be required:
(A) to issue, to register the transfer of or to exchange
Senior Notes during a period beginning at the
opening of business 15 days before the day of any
selection of Senior Notes for redemption under
Section 3.02 hereof and ending at the close of
business on the day of selection; or
(B) to register the transfer of or to exchange any
Senior Note so selected for redemption in whole or
in part, except the unredeemed portion of any Senior
Note being redeemed in part; or
(C) to register the transfer of or to exchange a Senior
Note between a record date and the next succeeding
interest payment date.
(vi) Prior to due presentment for the registration of a
transfer of any Senior Note, the Trustee, any Agent and
the Issuers may deem and treat the Person in whose name
any Senior Note is registered as the absolute owner of
such Senior Note for the purpose of receiving payment of
principal of and interest on such Senior Notes, and
22
neither the Trustee, any Agent nor the Issuers shall be
affected by notice to the contrary.
(vii) The Trustee shall authenticate Certificated Securities
and the Global Notes in accordance with the provisions
of Section 2.02 hereof.
SECTION 2.07. REPLACEMENT SENIOR NOTES.
If any mutilated Senior Note is surrendered to the Trustee, or the
Issuers and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Senior Note, the Issuers shall issue and the
Trustee, upon the written order of the Issuers signed by (i) two Officers of the
General Partner and (ii) two Officers of Finance Corp., shall authenticate a
replacement Senior Note if the Trustee's requirements for replacements of Senior
Notes are met. If required by the Trustee, the Issuers or the Guarantor, an
indemnity bond must be supplied by the Holder that is sufficient in the judgment
of the Trustee, the Issuers and the Guarantor to protect the Issuers, the
Guarantor, the Trustee, any Agent or any authenticating agent from any loss
which any of them may suffer if a Senior Note is replaced. Each of the
Partnership, Finance Corp, the Guarantor and the Trustee may charge for its
expenses in replacing a Senior Note.
Every replacement Senior Note is an additional obligation of the
Issuers and the Guarantor and shall be entitled to all of the benefits of this
Indenture equally and ratably with all other Senior Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING SENIOR NOTES.
The Senior Notes outstanding at any time are all the Senior Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, and those described in this Section 2.08 as not
outstanding. If a Senior Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Senior Note is held by a bona fide purchaser. If the principal
amount of any Senior Note is considered paid under Section 4.01 hereof, it
ceases to be outstanding and interest on it ceases to accrue. Subject to Section
2.09 hereof, a Senior Note does not cease to be outstanding because the
Partnership, Finance Corp., the Guarantor, a Subsidiary of the Partnership,
Finance Corp. or the Guarantor or an Affiliate of the Partnership, Finance Corp.
or the Guarantor holds the Senior Note.
SECTION 2.09. TREASURY SENIOR NOTES.
In determining whether the Holders of the required principal amount
of Senior Notes have concurred in any direction, waiver or consent, Senior Notes
owned by the Partnership, Finance Corp., the Guarantor, any of their respective
Subsidiaries or any Affiliate of the Partnership, Finance Corp. or the Guarantor
shall be considered as though not outstanding, except that for purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Senior Notes which a Responsible Officer
knows to be so owned shall be so considered. Notwithstanding the foregoing,
Senior Notes that are to be acquired by the Partnership, Finance Corp., the
Guarantor, any Subsidiary of the Partnership, Finance Corp. or the Guarantor or
an Affiliate of the Partnership, Finance Corp. or the Guarantor pursuant to an
exchange offer, tender offer or other agreement shall not be deemed to be owned
by the Partnership, Finance Corp., the Guarantor, a Subsidiary of the
Partnership, Finance Corp. or the Guarantor or an Affiliate of the Partnership,
Finance Corp. or the Guarantor until legal title to the Senior Notes passes to
the Partnership, Finance Corp., the Guarantor, Subsidiary of the
23
Partnership, Finance Corp. or the Guarantor or Affiliate of the Partnership,
Finance Corp. or the Guarantor, as the case may be.
SECTION 2.10. TEMPORARY SENIOR NOTES.
Until definitive Senior Notes are ready for delivery, the Issuers may
prepare and the Trustee shall authenticate temporary Senior Notes. Temporary
Senior Notes shall be substantially in the form of definitive Senior Notes but
may have variations that the Issuers and the Trustee consider appropriate for
temporary Senior Notes. Without unreasonable delay, the Issuers shall prepare
and the Trustee, upon receipt of the written order of the Issuers signed by (i)
two Officers of the General Partner and (ii) two Officers of Finance Corp.,
shall authenticate definitive Senior Notes in exchange for temporary Senior
Notes. Until such exchange, temporary Senior Notes shall be entitled to the same
rights, benefits and privileges as definitive Senior Notes.
SECTION 2.11. CANCELLATION.
The Issuers at any time may deliver Senior Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Senior Notes surrendered to them for registration of transfer, exchange or
payment. The Trustee shall cancel all Senior Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Senior Notes (subject to the record retention requirement of the
Exchange Act), unless the Issuers direct cancelled Senior Notes to be returned
to them. The Issuers may not issue new Senior Notes to replace Senior Notes that
they have redeemed or paid or that have been delivered to the Trustee for
cancellation. All cancelled Senior Notes held by the Trustee shall be destroyed
and certification of their destruction delivered to the Issuers, unless by a
written order, signed by (i) two Officers of the General Partner and (ii) two
Officers of Finance Corp., the Issuers shall direct that cancelled Senior Notes
be returned to them.
SECTION 2.12. DEFAULTED INTEREST.
If the Issuers or the Guarantor defaults in a payment of interest on
the Senior Notes, the Issuers or the Guarantor (to the extent of its obligations
under the Subsidiary Guarantee) shall pay the defaulted interest in any lawful
manner plus, to the extent lawful, interest payable on the defaulted interest,
to the Persons who are Holders of the Senior Notes on a subsequent special
record date, which date shall be at the earliest practicable date but in all
events at least five Business Days prior to the payment date, in each case at
the rate provided in the Senior Notes and in Section 4.01 hereof. The Issuers
shall fix or cause to be fixed each such special record date and payment date,
and shall, promptly thereafter, notify the Trustee of any such date. At least 15
days before the special record date, the Issuers (or the Trustee, in the name of
and at the expense of the Issuers) shall mail to Holders of the Senior Notes a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
SECTION 2.13. RECORD DATE.
The record date for purposes of determining the identity of Holders
of the Senior Notes entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in TIA ss. 316(c).
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SECTION 2.14. CUSIP NUMBER.
The Issuers in issuing the Senior Notes may use a "CUSIP" number and,
if they do so, the Trustee shall use the CUSIP number in notices of redemption
or exchange as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Senior Notes and that reliance may be
placed only on the other identification numbers printed on the Senior Notes. The
Issuers will promptly notify the Trustee of any change in the CUSIP number.
ARTICLE 3
REDEMPTION AND OFFERS TO PURCHASE
SECTION 3.01. NOTICES TO TRUSTEE.
If the Issuers elect to redeem Senior Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, they shall furnish to the Trustee,
at least 30 days but not more than 75 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Senior Notes to be redeemed and (iv) the redemption price.
If the Issuers are required to make an offer to purchase Senior Notes
pursuant to the provisions of Sections 4.10 or 4.14 hereof, they shall furnish
to the Trustee, at least 30 days before the scheduled Purchase Date, an
Officers' Certificate setting forth (i) the Section of this Indenture pursuant
to which the offer to purchase shall occur, (ii) the terms of the offer, (iii)
the purchase price, (iv) the principal amount of the Senior Notes to be
purchased, and (v) further setting forth a statement to the effect that (a) the
Partnership or one of its Subsidiaries has made an Asset Sale and there are
Excess Proceeds aggregating more than $15 million and the amount of such Excess
Proceeds or (b) a Change of Control has occurred, as applicable.
SECTION 3.02. SELECTION OF SENIOR NOTES TO BE PURCHASED OR REDEEMED.
If the Issuers elect to redeem less than all of the Senior Notes
pursuant to the optional redemption provisions of Section 3.07 hereof and
paragraph 5 of the Senior Notes, the Trustee shall select the Senior Notes to be
redeemed as follows:
The Trustee shall select the Senior Notes to be redeemed among the
Holders of the Senior Notes on a pro rata basis, by lot or in accordance with
any other method the trustee considers fair and appropriate.
If less than all of the Senior Notes properly tendered in an Asset
Sale Offer pursuant to Sections 3.09 and 4.10 hereof are to be purchased, the
Trustee shall select the Senior Notes to be purchased on a pro rata basis.
The Trustee shall promptly notify the Issuers in writing of the
Senior Notes selected for redemption and, in the case of any Senior Note
selected for partial purchase or redemption, the principal amount thereof to be
purchased or redeemed. Senior Notes and portions of Senior Notes selected shall
be in amounts of $1,000 or whole multiples of $1,000; except that if all of the
Senior Notes of a Holder are to be purchased or redeemed, the entire outstanding
amount of Senior Notes held by such Holder,
25
even if not a multiple of $1,000, shall be purchased or redeemed. Except as
provided in the preceding sentence, provisions of this Indenture that apply to
Senior Notes called for redemption also apply to portions of Senior Notes called
for redemption.
In the event the Issuers are required to make an Asset Sale Offer
pursuant to Section 4.10 hereof and the amount of Excess Proceeds to be applied
to such purchase would result in the purchase of a principal amount of Senior
Notes which is not evenly divisible by $1,000, the Trustee shall promptly refund
to the Issuers the portion of such Excess Proceeds that is not necessary to
purchase the immediately lesser principal amount of Senior Notes that is so
divisible.
SECTION 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date,
the Issuers shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Senior Notes are to be redeemed at its
registered address.
The notice shall identify the Senior Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price;
(c) if any Senior Note is being redeemed in part, the portion of
the principal amount of such Senior Note to be redeemed and that, after
the redemption date upon surrender of such Senior Note, a new Senior Note
or Senior Notes in principal amount equal to the unredeemed portion shall
be issued upon cancellation of the original Senior Note;
(d) the name and address of the Paying Agent;
(e) that Senior Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(f) that, unless the Issuers default in making such redemption
payment, interest on Senior Notes called for redemption ceases to accrue
on and after the redemption date;
(g) the paragraph of the Senior Notes and/or Section of this
Indenture pursuant to which the Senior Notes called for redemption are
being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on
the Senior Notes.
At the Issuers' request, the Trustee shall give the notice of
redemption in the Issuers' name and at their expense; provided, however, that
the Issuers shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph (which request may be revoked by so notifying the
Trustee in writing on or before the Business Day immediately preceding the date
requested for the mailing of such notice).
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SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Senior Notes called for redemption become irrevocably due and payable
on the redemption date at the redemption price. A notice of redemption may not.
be conditional
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
One Business Day prior to the redemption date, the Issuers shall
deposit with the Trustee or with the Paying Agent money sufficient to pay the
redemption price of, and accrued interest including Liquidated Damages, if any,
on all Senior Notes to be redeemed on that date. The Trustee or the Paying Agent
shall promptly return to the Issuers any money deposited with the Trustee or the
Paying Agent by the Issuers in excess of the amounts necessary to pay the
redemption price of, and accrued interest on, all Senior Notes to be redeemed.
If the Issuers comply with the provisions of the preceding paragraph,
on and after the redemption date, interest shall cease to accrue on the Senior
Notes or the portions of Senior Notes called for redemption. If a Senior Note is
redeemed on or after an interest record date but on or prior to the related
interest payment date, then any accrued and unpaid interest shall be paid to the
Person in whose name such Senior Note was registered at the close of business on
such record date. If any Senior Note called for redemption shall not be so paid
upon surrender for redemption because of the failure of the Issuers to comply
with the preceding paragraph, interest shall be paid on the unpaid principal,
from the redemption date until such principal is paid, and to the extent lawful
on any interest not paid on such unpaid principal, in each case at the rate
provided in the Senior Notes and in Section 4.01 hereof.
SECTION 3.06. SENIOR NOTES REDEEMED IN PART.
Upon surrender of a Senior Note that is redeemed in part, the Issuers
shall issue and, upon the Issuers' written request, the Trustee shall
authenticate for the Holder at the expense of the Issuers a new Senior Note
equal in principal amount to the unredeemed portion of the Senior Note
surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
The Issuers may redeem all or any portion of the Senior Notes, upon
the terms and at the redemption prices set forth in paragraph 5 of the Senior
Notes. Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
Except as set forth under Sections 4.10 and 4.14 hereof, the Issuers
shall not be required to make mandatory payments with respect to the Senior
Notes.
SECTION 3.09. ASSET SALE OFFERS.
In the event that, pursuant to Section 4.10 hereof, the Issuers shall
be required to commence an offer to all Holders to purchase Senior Notes (an
"Asset Sale Offer"), it shall follow the procedures specified in this Section
3.09.
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The Asset Sale Offer shall commence on the date (the "Commencement
Date") specified in Section 4.10 hereof and shall remain open for a period
specified by the Issuers, which shall be in accordance with Section 4.10 hereof
(the "Offer Period"). No later than five Business Days after the termination of
the Offer Period (the "Purchase Date"), the Issuers shall purchase the principal
amount of Senior Notes required to be purchased pursuant to Section 4.10 hereof
(the "Offer Amount") or, if less than the Offer Amount has been tendered, all
Senior Notes tendered in response to such Asset Sale Offer. Payment for any
Senior Notes so purchased shall be made in the same manner as interest payments
are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest and
Liquidated Damages, if any, shall be paid to the Person in whose name a Senior
Note is registered at the close of business on such record date, and no
additional interest shall be payable to Holders who tender Senior Notes pursuant
to such Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Issuers shall send,
by first class mail, a notice to the Trustee and each of the Holders. The notice
shall contain all instructions and materials necessary to enable such Holders to
tender Senior Notes pursuant to such Asset Sale Offer. The Asset Sale Offer
shall be made to all Holders. The notice, which shall govern the terms of the
Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to Section
4.10 hereof, the Offer Period, and the expiration date of the Offer
Period;
(b) the Offer Amount, the purchase price and the Purchase
Date;
(c) that any Senior Note not tendered and accepted for payment
shall continue to accrue interest and Liquidated Damages, if any;
(d) that, unless the Issuers default in making such payment, any
Senior Note accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest and Liquidated Damages, if any, after the
Purchase Date;
(e) that Holders electing to have a Senior Note purchased
pursuant to any Asset Sale Offer shall be required to surrender the Senior
Note, with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Senior Note completed, to the Issuers, a depositary, if
appointed by the Issuers, or a Paying Agent at the address specified in
the notice prior to the close of the Offer Period;
(f) that Holders shall be entitled to withdraw their election if
the Issuers, the depositary or the Paying Agent, as the case may be,
receives, not later than the close of the Offer Period, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Senior Note the Holder delivered for purchase and
a statement that such Holder is withdrawing his election to have such
Senior Note purchased;
(g) that, if the aggregate principal amount of Senior Notes
surrendered by Holders exceeds the Offer Amount, the Senior Notes to be
purchased shall be selected pursuant to the terms of Section 3.02 hereof,
and that Holders whose Senior Notes were purchased only in part shall be
issued new Senior Notes (accompanied by a notation of the Subsidiary
Guarantee duly endorsed by
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the Guarantor) equal in principal amount to the unpurchased portion of
the Senior Notes surrendered; and
(h) the circumstances and material facts regarding the Asset
Sale or Asset Sales giving rise to such Asset Sale Offer, including but
not limited to, information with respect to pro forma and historical
financial information if material operations of the Partnership or any
Subsidiary were divested in such Asset Sale or Asset Sales.
On or before the Purchase Date, the Issuers shall, to the extent
lawful, accept for payment, pursuant to the terms of Section 3.02 hereof, the
Offer Amount of Senior Notes or portions thereof tendered pursuant to the Asset
Sale Offer, or if less than the Offer Amount has been tendered, all Senior Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating that
such Senior Notes or portions thereof were accepted for payment by the Issuers
in accordance with the terms of this Section 3.09. The Issuers, the depositary
or the Paying Agent, as the case may be, shall promptly (but in any case not
later than five days after the Purchase Date) wire, mail or deliver to each
tendering Holder an amount equal to the purchase price of the Senior Notes
tendered by such Holder and accepted by the Issuers for purchase, and the
Issuers shall promptly issue a new Senior Note, and the Trustee, upon written
request from the Issuers shall authenticate and mail or deliver such new Senior
Note to such Holder, in a principal amount equal to any unpurchased portion of
the Senior Note surrendered. Any Senior Note not so accepted shall be promptly
mailed or delivered by the Issuers to the Holder thereof. The Issuers shall
publicly announce the results of such Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Sections 3.01 through 3.06 hereof to the extent applicable.
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF SENIOR NOTES.
The Issuers shall pay or cause to be paid the principal of, premium,
if any, and interest, including Liquidated Damages, if any, on the Senior Notes
on the dates and in the manner provided in the Senior Notes. Principal, premium,
if any, and interest shall be considered paid on the date due if the Paying
Agent, if other than the Issuers or the Guarantor, holds as of 10:00 a.m.
Eastern Time on the due date money deposited by the Issuers or the Guarantor in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, and interest, including Liquidated Damages, if any,
then due.
The Issuers shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate equal
to 1% per annum in excess of the then applicable interest rate on the Senior
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest, including Liquidated Damages, if any, (without regard to any
applicable grace period) at the same rate to the extent lawful.
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SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Issuers shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Senior Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Issuers or the Guarantor in respect of the Senior Notes
and this Indenture may be served. The Issuers shall give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Issuers shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee.
The Issuers may also from time to time designate one or more other
offices or agencies where the Senior Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Issuers of their obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Issuers shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
The Issuers hereby designate the Corporate Trust Office of the
Trustee as one such office or agency of the Issuers in accordance with Section
2.03 hereof.
SECTION 4.03. REPORTS.
Whether or not required by the rules and regulations of the SEC, so
long as any Senior Notes are outstanding, the Issuers will furnish to the
Holders of Senior Notes (i) all quarterly and annual financial information that
would be required to be contained in a filing with the SEC on Forms 10-Q and
10-K if the Issuers were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and,
with respect to the annual information only, a report thereon by the Issuers'
certified independent accountants and (ii) all reports that would be required to
be filed with the SEC on Form 8-K if the Issuers were required to file such
reports. In addition, whether or not required by the rules and regulations of
the SEC, the Issuers will file a copy of all such information with the SEC for
public availability (unless the SEC will not accept such a filing) and make such
information available to investors who request it in writing. In addition, for
so long as any Senior Notes remain outstanding, the Issuers shall furnish to all
Holders and to securities analysts and prospective investors, upon their written
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) Each Issuer shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Partnership and its Subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officers with a
view to determining whether each Issuer, the Guarantor and each obligor on the
Senior Notes and this Indenture has kept, observed, performed and fulfilled its
obligations under this Indenture (including with respect to any Restricted
Payments made during such year, the basis upon which the calculations required
by Section 4.07 hereof were computed, which calculations may be based on the
Partnership's latest available financial statements), and further stating, as to
each such Officer signing such certificate, that to the best of his or her
knowledge, each Issuer, the Guarantor and each such obligor has kept, observed,
performed and fulfilled each and every covenant contained in this Indenture and
the Pledge Agreement and is not
30
in default in the performance or observance of any of the terms, provisions and
conditions of this Indenture or the Pledge Agreement (or, if a Default or Event
of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action each Issuer, the
Guarantor or each such obligor, as the case may be, is taking or proposes to
take with respect thereto) and that to the best of his or her knowledge no event
has occurred and remains in existence by reason of which payments on account of
the principal of, premium, if any, interest or Liquidated Damages, if any, on
the Senior Notes is prohibited or if such event has occurred, a description of
the event and what action each Issuer, the Guarantor or each such obligor, as
the case may be, is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03 hereof shall be accompanied by a
written statement of the Partnership's independent public accountants (who shall
be a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Issuers have violated
any provisions of Article Four or Article Five hereof or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) Each Issuer and the Guarantor shall, so long as any of the Senior
Notes are outstanding, deliver to the Trustee, forthwith upon any Officer of
such Issuer (or of the General Partner, in the case of the Partnership and the
Guarantor) becoming aware of any Default or Event of Default, an Officers'
Certificate specifying such Default or Event of Default and what action such
Issuer and the Guarantor is taking or proposes to take with respect thereto.
SECTION 4.05. TAXES.
The Issuers shall pay, and shall cause each of their Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Senior Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
Each of the Issuers and the Guarantor covenants (to the extent that
it may lawfully do so) that it shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and each of
the Issuers and the Guarantor (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make
any distribution on account of the Partnership's or any Subsidiary's Equity
Interests (other than (x) dividends or distributions payable in Equity Interests
(other
31
than Disqualified Interests) of the Partnership, (y) dividends or distributions
payable to the Partnership or the Operating Partnership or (z) distributions or
dividends payable pro rata to all holders of Capital Interests of any such
Subsidiary); (ii) purchase, redeem or otherwise acquire or retire for value any
Equity Interests of the Partnership or any Subsidiary or other Affiliate of the
Partnership (other than any such Equity Interests owned by the Partnership or
the Operating Partnership); (iii) purchase, redeem or otherwise acquire or
retire for value any Indebtedness that is subordinated to the Senior Notes; or
(iv) make any Restricted Investment (all such payments and other actions set
forth in clauses (i) through (iv) above being collectively referred to as
"Restricted Payments"), unless, at the time of and after giving effect to such
Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(b) the Fixed Charge Coverage Ratio of the Partnership for the
Partnership's most recently ended four full fiscal quarters for which
internal financial statements are available immediately preceding the date
on which such Restricted Payment is made calculated on a pro forma basis
as if such Restricted Payment had been made at the beginning of such
four-quarter period, would have been more than 2.0 to 1.0; and
(c) such Restricted Payment (the amount of any such payment, if
other than cash, to be determined by the Board of Directors, whose
determination shall be conclusive and evidenced by a resolution in an
Officers' Certificate delivered to the Trustee), together with the
aggregate of all other Restricted Payments (other than any Restricted
Payments permitted by the provisions of clauses (ii) or (iii) of the
penultimate paragraph of this Section 4.07) made by the Partnership and
its Subsidiaries in the fiscal quarter during which such Restricted
Payment is made, shall not exceed an amount equal to the sum of (i)
Available Cash of the Partnership for the immediately preceding fiscal
quarter (or, with respect to the first fiscal quarter during which
Restricted Payments are made, the amount of Available Cash of the
Partnership for the period commencing on the date of this Indenture and
ending on the last day of the immediately preceding fiscal quarter) plus
(ii) the lesser of (x) the amount of Available Cash of the Partnership for
the first 45 days of the fiscal quarter during which such Restricted
Payment is made and (y) the amount of working capital Indebtedness that
the Partnership could have incurred on the last day of the immediately
preceding fiscal quarter under the terms of the agreements and instruments
governing its outstanding Indebtedness on such date.
The foregoing provisions will not prohibit (i) the payment of any
distribution within 60 days after the date on which the Partnership becomes
committed to make such distribution, if at said date of commitment such payment
would have complied with the provisions of this Indenture; (ii) the redemption,
repurchase, retirement or other acquisition of any Equity Interests of the
Partnership in exchange for, or out of the proceeds of, the substantially
concurrent sale (other than to a Subsidiary of the Partnership) of other Equity
Interests of the Partnership (other than any Disqualified Interests); and (iii)
the defeasance, redemption or repurchase of Subordinated Indebtedness with the
proceeds of Permitted Refinancing Indebtedness.
Not later than the date of making any Restricted Payment, the General
Partner shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, which calculations may
be based upon the Partnership's latest available financial statements.
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SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Subsidiary to (a) pay dividends or make any other distributions to the
Partnership or any of its Subsidiaries (1) on its Capital Interests or (2) with
respect to any other interest or participation in, or measured by, its profits,
(b) pay any indebtedness owed to the Partnership or any of its Subsidiaries, (c)
make loans or advances to the Partnership or any of its Subsidiaries or (d)
transfer any of its properties or assets to the Partnership or any of its
Subsidiaries, except for such encumbrances or restrictions existing under or by
reason of (i) Existing Indebtedness as in effect on the date of this Indenture,
(ii) the Credit Facility, as in effect on the date of this Indenture, this
Indenture, the Senior Notes, the Subsidiary Guarantee, the Operating Partnership
Indenture as in effect on the date of this Indenture, the Fixed Rate Notes and
the Floating Rate Notes, (iii) applicable law, (iv) any instrument governing
Indebtedness or Capital Interests of a Person acquired by the Partnership or any
of its Subsidiaries as in effect at the time of such acquisition (except to the
extent such Indebtedness was incurred in connection with or in contemplation of
such acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired, provided that the Consolidated
Cash Flow of such Person to the extent that dividends, distributions, loans,
advances or transfers thereof is limited by such encumbrance or restriction on
the date of acquisition is not taken into account in determining whether such
acquisition was permitted by the terms of this Indenture, (v) customary
non-assignment provisions in leases entered into in the ordinary course of
business and consistent with past practices, (vi) purchase money obligations for
property acquired in the ordinary course of business that impose restrictions of
the nature described in clause (d) above on the property so acquired, (vii)
Permitted Refinancing Indebtedness of any Existing Indebtedness, provided that
the restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive than those contained in the
agreements governing the Indebtedness being refinanced, (viii) agreements
governing any Indebtedness that is permitted to be incurred hereunder and that
is incurred to extend, refinance, renew, replace, defease or refund Indebtedness
outstanding pursuant to the Credit Facility, provided that the restrictions
contained in the agreements governing such refinancing Indebtedness are no more
restrictive than those contained in the Credit Facility as in effect on the date
of this Indenture or (ix) other Indebtedness permitted to be incurred subsequent
to the date of this Indenture pursuant to the provisions of Section 4.09 hereof;
provided that such restrictions are no more restrictive than those contained in
the Credit Facility and the Operating Partnership Indenture, each as in effect
on the date of this Indenture.
SECTION 4.09.INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED INTERESTS.
The Issuers shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable with respect to (collectively, "incur") any
Indebtedness (including Acquired Debt) and the Issuers shall not issue any
Disqualified Interests and shall not permit any of their Subsidiaries to issue
any shares of preferred stock; provided, however, that the Issuers may incur
Indebtedness and any Subsidiary of the Issuers may incur Acquired Debt if the
Fixed Charge Coverage Ratio for the Partnership's most recently ended four full
fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
would have been at least 2.25 to 1.0, determined on a pro forma basis (including
a pro forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred at the beginning of such four-quarter period.
33
Notwithstanding the foregoing, the Operating Partnership shall not,
and shall not permit any of its Subsidiaries to, directly or indirectly incur
any Subordinated Indebtedness (including Acquired Debt which constitutes
Subordinated Indebtedness) and that the Operating Partnership shall not issue
any Disqualified Interests and shall not permit any of its Subsidiaries to issue
any shares of preferred stock prior to the Subsidiary Guarantee Effectiveness
Date, irrespective of whether the Partnership's Fixed Charge Coverage Ratio
exceeds 2.25 to 1.0.
The foregoing limitations of this Section 4.09 will not apply to: (i)
the Indebtedness represented by the Senior Notes and the Subsidiary Guarantee;
(ii) the incurrence by the Operating Partnership of Indebtedness pursuant to the
Credit Facility (or any Permitted Senior Refinancing Indebtedness in respect
thereof) in an aggregate principal amount at any time outstanding not to exceed
$205.0 million; (iii) the Indebtedness represented by the existing Fixed Rate
Notes and Floating Rate Notes; (iv) revolving Indebtedness incurred solely for
working capital purposes in an aggregate outstanding principal amount not to
exceed $40.0 million at any time, provided that the outstanding principal
balance of such revolving Indebtedness (or, if such revolving Indebtedness is
incurred as an addition or extension to the Credit Facility, the outstanding
principal balance under the Credit Facility in excess of the limits set forth in
clause (ii) above) shall be reduced to zero for a period of 30 consecutive days
during each fiscal year; (v) the incurrence by the Partnership or any of its
Subsidiaries of Indebtedness in respect of Capitalized Lease Obligations in an
aggregate principal amount not to exceed $15.0 million; (vi) the Existing
Indebtedness; (vii) the incurrence by the Partnership or any of its Subsidiaries
of Permitted Refinancing Indebtedness in exchange for, or the proceeds of which
are used to extend, refinance, renew, replace, defease or refund any then
outstanding Indebtedness of the Partnership or such Subsidiary not incurred in
violation of this Indenture; (viii) Hedging Obligations that are incurred for
the purpose of fixing or hedging interest rate risk with respect to any floating
rate Indebtedness that is permitted by the terms of this Indenture to be
outstanding; (ix) Indebtedness of any Subsidiary of the Partnership to the
Partnership or any of its Wholly Owned Subsidiaries; (x) the incurrence by the
Partnership, the Operating Partnership or the Insurance Company Subsidiary of
Indebtedness owing directly to its insurance carriers (without duplication) in
connection with the Partnership's, the Operating Partnership's, their
Subsidiaries' or their Affiliates' self-insurance programs or other similar
forms of retained insurable risks for their respective retail propane
businesses, consisting of reinsurance agreements and indemnification agreements
(and guarantees of the foregoing) secured by letters of credit, provided that
the Indebtedness evidenced by such reinsurance agreements, indemnification
agreements, guarantees and letters of credit shall be counted (without
duplication) for purposes of all calculations pursuant to the Fixed Charge
Coverage Ratio test above; (xi) surety bonds and appeal bonds required in the
ordinary course of business or in connection with the enforcement of rights or
claims of the Partnership or any of its Subsidiaries or in connection with
judgments that do not result in a Default or Event of Default; (xii) the
incurrence by the Partnership or the Operating Partnership of Indebtedness in
connection with acquisitions of retail propane businesses in favor of the
sellers of such businesses in a principal amount not to exceed $15.0 million in
any fiscal year or $60.0 million in the aggregate outstanding at any one time,
provided that the principal amount of such Indebtedness incurred in connection
with any such acquisition shall not exceed the fair market value of the assets
so acquired; and (xiii) Indebtedness of the Partnership owing from time to time
to the General Partner or an Affiliate of the General Partner that is unsecured
and that is Subordinated Indebtedness; provided that the aggregate principal
amount of such Indebtedness outstanding at any time shall not exceed $50.0
million.
The aggregate amount of Indebtedness permitted to be incurred by
clauses (ii), (iv), (v), (xii) and (xiii) above, shall be reduced by the
aggregate amount of any sale and leaseback transaction entered into by the
Partnership or its Subsidiaries pursuant to the terms of the last sentence of
Section 4.17 of this Indenture.
34
For purposes of this Section 4.09, any revolving Indebtedness shall
be deemed to have been incurred only at such time at which the agreements and
instruments (including any amendments thereto that increase the amount, reduce
the Weighted Average Life to Maturity, change any subordination provisions or
create any additional obligor of such revolving Indebtedness) are executed, in
an amount equal to the maximum amount of such revolving Indebtedness permitted
to be borrowed thereunder, and the Partnership's ability to borrow or reborrow
such revolving Indebtedness up to such maximum permitted amount shall not
thereafter be limited by the provisions of this Section 4.09 (other than the
proviso set forth in clause (iv) of the third paragraph of this Section 4.09.)
SECTION 4.10. ASSET SALES.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, (i) sell, lease, convey or otherwise dispose of any assets
(including by way of a sale-and-leaseback) other than sales of inventory in the
ordinary course of business consistent with past practice (provided that the
sale, lease, conveyance or other disposition of all or substantially all of the
assets of the Partnership shall be governed by the provisions of Sections 4.14
and/or 5.01 hereof and not by the provisions of this Section 4.10), or (ii)
issue or sell Equity Interests of any of its Subsidiaries, in the case of either
clause (i) or (ii) above, whether in a single transaction or a series of related
transactions, (a) that have a fair market value in excess of $5 million, or (b)
for net proceeds in excess of $5 million (each of the foregoing, an "Asset
Sale"), unless (x) the Partnership (or the Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least equal to the fair
market value (evidenced by a resolution of the Board of Directors set forth in
an Officers' Certificate delivered to the Trustee) of the assets sold or
otherwise disposed of and (y) at least 80% of the consideration therefor
received by the Partnership or such Subsidiary is in the form of cash; provided,
however, that the amount of (A) any liabilities (as shown on the Partnership's
or such Subsidiary's most recent balance sheet or in the notes thereto) of the
Partnership or any Subsidiary (other than liabilities that are by their terms
subordinated in right of payment to the Senior Notes) that are assumed by the
transferee of any such assets and (B) any notes or other obligations received by
the Partnership or any such Subsidiary from such transferee that are immediately
converted by the Partnership or such Subsidiary into cash (to the extent of the
cash received), shall be deemed to be cash for purposes of this provision; and
provided, further, that the 80% limitation referred to in this clause (y) shall
not apply to any Asset Sale in which the cash portion of the consideration
received therefrom, determined in accordance with the foregoing proviso, is
equal to or greater than what the after-tax proceeds would have been had such
Asset Sale complied with the aforementioned 80% limitation. Notwithstanding the
foregoing, Asset Sales shall not be deemed to include (1) any transfer of assets
by the Partnership or any of its Subsidiaries to a Wholly Owned Subsidiary of
the Partnership that is a Guarantor, (2) any transfer of assets by the
Partnership or any of its Subsidiaries to any Person in exchange for other
assets used in a line of business permitted under Section 4.16 hereof and having
a fair market value not less than that of the assets so transferred, (3) any
transfer of assets pursuant to a Permitted Investment and (4) any transfer of
assets to a Non-Recourse Subsidiary by the Partnership or any of its
Subsidiaries, which assets were acquired in a Flow-Through Acquisition; provided
that no Default or Event of Default has occurred and is continuing or would
occur as a result of such transfer.
Within 270 days after any Asset Sale, the Partnership may apply the
Net Proceeds from such Asset Sale to (a) permanently reduce Indebtedness
outstanding under the Credit Facility (with a permanent reduction of
availability in the case of revolving Indebtedness), the Operating Partnership
Indenture or any other Indebtedness permitted to be incurred by the Operating
Partnership under this Indenture or (b) an investment in capital expenditures or
other long-term tangible assets, in each case, in the same line of business as
the Partnership and its Subsidiaries were engaged in on the date of this
Indenture. Pending the final application of any such Net Proceeds, the
Partnership may temporarily reduce borrowings under
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the Credit Facility or otherwise invest such Net Proceeds in any manner that is
not prohibited by this Indenture. Any Net Proceeds from the Asset Sale that are
not applied or invested as provided in the first sentence of this paragraph will
be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $15 million, the Issuers shall make an Asset Sale Offer to all
Holders of Senior Notes to purchase the maximum principal amount of Senior Notes
that may be purchased out of the Excess Proceeds, at an offer price in cash in
an amount equal to 100% of the principal amount thereof plus accrued, unpaid
interest and Liquidated Damages, if any, to the date of purchase, in accordance
with the procedures set forth in Article 3 hereof. The Issuers shall commence an
Asset Sale Offer with respect to Excess Proceeds within 10 Business Days after
the date that Excess Proceeds exceeds $15 million by mailing the notice required
in Section 3.09 hereof to the Holders. The Offer Period shall be not less than
30 days and not more than 40 days, unless a longer period is required by law.
The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations to the extent such laws and
regulations are applicable in connection with the repurchase of the Senior Notes
in connection with an Asset Sale Offer. To the extent that the aggregate amount
of Senior Notes tendered pursuant to an Asset Sale Offer is less than the Excess
Proceeds, the Partnership may use such deficiency for general business purposes.
If the aggregate principal amount of Senior Notes surrendered by Holders thereof
exceeds the amount of Excess Proceeds, the Trustee shall select the Senior Notes
to be purchased on a pro rata basis. Upon completion of such offer to purchase,
the amount of Excess Proceeds shall be reset at zero.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
any contract, agreement, understanding, loan, advance or guarantee with, or for
the benefit of, any Affiliate, including any Non-Recourse Subsidiary (each of
the foregoing, an "Affiliate Transaction"), unless (a) such Affiliate
Transaction is on terms that are no less favorable to the Partnership or the
relevant Subsidiary than those that would have been obtained in a comparable
transaction by the Partnership or such Subsidiary with an unrelated Person and
(b) with respect to (i) any Affiliate Transaction with an aggregate value in
excess of $500,000, a majority of the directors of the General Partner having no
direct or indirect economic interest in such Affiliate Transaction determines by
resolution that such Affiliate Transaction complies with clause (a) above and
approves such Affiliate Transaction and (ii) any Affiliate Transaction involving
the purchase or other acquisition or sale, lease, transfer or other disposition
of properties or assets other than in the ordinary course of business, in each
case, having a fair market value or for net proceeds in excess of $15.0 million,
the Partnership delivers to the Trustee an opinion as to the fairness to the
Partnership or such Subsidiary from a financial point of view issued by an
investment banking firm of national standing; provided, however, that (i) any
employment agreement or stock option agreement entered into by the Partnership
(or the General Partner) in the ordinary course of business and consistent with
the past practice of the Partnership (or the General Partner) or such
Subsidiary, (ii) Restricted Payments permitted by the provisions of Section 4.07
hereof, and (iii) transactions entered into by the Partnership, the Operating
Partnership or the Insurance Company Subsidiary in the ordinary course of
business in connection with reinsuring the self-insurance programs or other
similar forms of retained insurable risks of the retail propane businesses
operated by the Partnership, its Subsidiaries and its Affiliates, in each case,
shall not be deemed Affiliate Transactions. Notwithstanding the foregoing, in
any transaction involving a Flow-Through Acquisition, the dollar amount equal to
the purchase price paid by the General Partner or its parent to any third party
that is not an Affiliate for such property, assets or equipment will be excluded
from calculating the value and/or net proceeds set forth in clauses (b)(i) and
(ii) above.
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SECTION 4.12. LIENS.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien on any asset now owned or hereafter acquired, or any income or
profits therefrom or assign or convey any right to receive income therefrom,
except Permitted Liens.
SECTION 4.13. LIMITATIONS ON SUBSIDIARY STRUCTURE.
Each of the Operating Partnership and Finance Corp. shall at all
times continue to be direct Wholly Owned Subsidiaries of the Partnership.
In addition, the Operating Partnership and the Finance Corps. may not at any
time be designated as Non-Recourse Subsidiaries.
SECTION 4.14. OFFER TO PURCHASE UPON CHANGE OF CONTROL.
Upon the occurrence of a Change of Control, the Issuers shall make an
offer (a "Change of Control Offer") to each Holder to purchase all or any part
of such Holder's Senior Notes at an offer price in cash equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, to the date of purchase (the "Change of Control
Payment"). The Issuers shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with such Change
of Control Offer.
The Issuers shall commence such Change of Control Offer within 10
days following any Change of Control by mailing a notice of such Change of
Control to each Holder at its last registered address with a copy to the Trustee
and the Paying Agent. The Change of Control Offer shall remain open from the
time of mailing until the close of business on the Business Day preceding the
Change of Control Payment Date (as defined below). The notice, which shall
govern the terms of the Change of Control Offer, shall state:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.14 and that all Senior Notes tendered will be accepted
for payment;
(2) the amount of the Change of Control Payment and the purchase
date, which is a date no earlier than 30 days nor later than 60
days from the date that the Issuers mail notice of the Change of
Control to the Holders (the "Change of Control Payment Date");
(3) that any Senior Notes not tendered will continue to accrue
interest in accordance with the terms of the Indenture;
(4) that, unless the Issuers default in the payment of the Change of
Control Payment, all Senior Notes accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest
after the Change of Control Payment Date;
(5) that Holders electing to have Senior Notes purchased pursuant to
the Change of Control Offer will be required to surrender their
Senior Notes, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Senior Note completed, to the
Paying Agent at the address specified in the notice prior to the
close of business on the third Business Day preceding the Change
of Control Payment Date;
37
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on
the second Business Day preceding the Change of Control Payment
Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount of
Senior Notes the Holder delivered for purchase, and a statement
that such Holder is withdrawing its election to have such Senior
Notes purchased;
(7) that Holders whose Senior Notes are being purchased only in part
will be issued new Senior Notes equal in principal amount to the
unpurchased portion of the Senior Notes surrendered, which
unpurchased portion must be equal to $1,000 in principal amount
or an integral multiple thereof; and
(8) the circumstances and relevant facts regarding such Change of
Control (including, but not limited to, information with respect
to pro forma historical financial information after giving
effect to such Change of Control, information regarding the
Person or Persons acquiring control and such Person's or
Persons' business plans going forward).
On the Change of Control Payment Date, the Issuers shall, to the
extent lawful, (i) accept for payment Senior Notes or portions thereof tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Senior Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Trustee the Senior Notes so accepted together with an Officers' Certificate
stating the aggregate amount of the Senior Notes or portions thereof tendered to
the Issuers. The Paying Agent shall promptly, but in no event later than three
Business Days following the Change of Control Payment Date, wire or mail to each
Holder of Notes so accepted payment in an amount equal to the Change of Control
Payment for such Senior Notes, and the Issuers shall promptly issue a new Senior
Note, and the Trustee shall authenticate and mail or deliver a new Senior Note
to such Holder equal in principal amount to any unpurchased portion of the
Senior Notes surrendered, if any; provided, that each such new Senior Note shall
be in a principal amount of $1,000 or an integral multiple thereof. The Issuers
shall publicly announce in The Wall Street Journal, or if no longer published, a
national newspaper of general circulation the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment Date.
SECTION 4.15. PARTNERSHIP OR CORPORATE EXISTENCE.
Subject to Article 5 hereof, as the case may be, each Issuer and the
Guarantor shall do or cause to be done all things necessary to preserve and keep
in full force and effect (i) its corporate or partnership existence, and the
corporate or partnership existence of each of their Subsidiaries, in accordance
with the respective organizational documents (as the same may be amended from
time to time) of each Issuer, the Guarantor or any such Subsidiary, as the case
may be, and (ii) the rights (charter and statutory), licenses and franchises of
each Issuer, the Guarantor and their respective Subsidiaries; provided, however,
that the Issuers and the Guarantor shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence of
any of their respective Subsidiaries, if an Officer of the General Partner or
Finance Corp., as the case may be, shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Issuers, the
Guarantor and their Subsidiaries, taken as a whole and that the loss thereof is
not adverse in any material respect to the Holders of the Senior Notes.
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SECTION 4.16. LINE OF BUSINESS.
For so long as any Senior Notes are outstanding, the Partnership and
its Subsidiaries will not materially or substantially engage in any business
other than that in which the Partnership and its Subsidiaries were engaged on
the date of this Indenture.
SECTION 4.17. LIMITATION ON SALE AND LEASEBACK TRANSACTIONS.
The Partnership shall not, and shall not permit any of its
Subsidiaries to, enter into any arrangement with any Person providing for the
leasing by the Partnership or such Subsidiary of any property that has been or
is to be sold or transferred by the Partnership or such Subsidiary to such
Person in contemplation of such leasing, unless (a) the Partnership or such
Subsidiary would be permitted under this Indenture to incur Indebtedness secured
by a Lien on such property in an amount equal to the Attributable Debt with
respect to such sale and leaseback transaction or (b) the lease in such sale and
leaseback transaction is for a term not in excess of the lesser of (i) three
years and (ii) 60% of the useful remaining life of such property.
Notwithstanding the foregoing, the Partnership and its Subsidiaries may enter
into sale and leaseback transactions relating to propane tanks up to an
aggregate principal amount of $25 million at any time, provided that such
transaction would not cause a default under Section 4.09 hereof.
SECTION 4.18. RESTRICTIONS ON NATURE OF INDEBTEDNESS AND ACTIVITIES OF FINANCE
CORP.
In addition to the provisions of Section 4.09 hereof, Finance Corp.
shall not incur any Indebtedness unless (a) the Partnership is a co-obligor or
guarantor of such Indebtedness or (b) the net proceeds of such Indebtedness are
lent to the Partnership, used to acquire outstanding debt securities issued by
the Partnership or used directly or indirectly to refinance or discharge
Indebtedness permitted under the limitations of this Section 4.18. Finance Corp.
shall not engage in any business not related directly or indirectly to obtaining
money or arranging financing for the Partnership.
ARTICLE 5
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
(a) The Partnership shall not consolidate or merge with or into
(whether or not the Partnership is the surviving corporation), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions, to another Person
unless (i) the Partnership is the surviving Person, or the Person formed by or
surviving any such consolidation or merger (if other than the Partnership) or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation or partnership organized or existing under
the laws of the United States, any state thereof or the District of Columbia;
(ii) the Person formed by or surviving any such consolidation or merger (if
other than the Partnership) or Person to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made assumes all the
obligations of the Partnership pursuant to a supplemental indenture in a form
reasonably satisfactory to the Trustee, under the Senior Notes and this
Indenture; (iii) immediately after such transaction no Default or Event of
Default exists; and (iv) the Partnership or any Person formed by or surviving
any such consolidation or merger, or to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made (A) shall have
Consolidated Net Worth (immediately after the
39
transaction but prior to any purchase accounting adjustments resulting from the
transaction) equal to or greater than the Consolidated Net Worth of the
Partnership immediately preceding the transaction and (B) shall, at the time of
such transaction and after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter period,
be permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth in Section 4.09 hereof.
(b) Finance Corp. may not consolidate or merge with or into (whether
or not Finance Corp. is the surviving Person), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions, to another Person unless (i) Finance
Corp. is the surviving Person, or the Person formed by or surviving any such
consolidation or merger (if other than Finance Corp.) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is a corporation organized or existing under the laws of the United States,
any state thereof or the District of Columbia and a Wholly Owned Subsidiary of
the Partnership; (ii) the Person formed by or surviving any such consolidation
or merger (if other than Finance Corp.) or the Person to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made assumes all the obligations of Finance Corp., pursuant to a supplemental
indenture in a form reasonably satisfactory to the Trustee, under the Senior
Notes and this Indenture; and (iii) immediately after such transaction no
Default or Event of Default exists.
(c) The Partnership or Finance Corp., as the case may be, shall
deliver to the Trustee prior to the consummation of the proposed transaction
pursuant to the foregoing paragraphs (a) and (b) an Officers' Certificate to the
foregoing effect and an Opinion of Counsel stating that the proposed transaction
and such supplemental indenture comply with this Indenture. The Trustee shall be
entitled to conclusively rely upon such Officers' Certificate and Opinion of
Counsel.
SECTION 5.02. SUCCESSOR PERSON SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Partnership or Finance Corp. in accordance with Section 5.01 hereof, the
successor Person formed by such consolidation or into or with which the
Partnership or Finance Corp. is merged or to which such sale, assignment,
transfer, lease, conveyance or other disposition is made shall succeed to, and
be substituted for (so that from and after the date of such consolidation,
merger, sale, lease, conveyance or other disposition, the provisions of this
Indenture referring to the "Partnership," "Finance Corp.," or the "Issuers," as
the case may be shall refer to or include instead the successor Person and not
the Partnership or Finance Corp., as the case may be), and may exercise every
right and power of the Partnership or Finance Corp., as the case may be under
this Indenture with the same effect as if such successor Person had been named
as the Partnership or Finance Corp., as the case may be, herein; provided,
however, that the predecessor Issuer shall not be relieved from the obligation
to pay the principal of, premium, if any, and interest including Liquidated
Damages, if any, on the Senior Notes except in the case of a sale of all of such
Issuer's assets that meets the requirements of Section 5.01 hereof.
40
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Issuers or the Guarantor default in the payment of
interest and Liquidated Damages, if any, on the Senior Notes when the same
becomes due and payable and such default continues for a period of 30
days;
(b) the Issuers or the Guarantor default in the payment of
principal of or premium, if any, on the Senior Notes when the same becomes
due and payable at maturity, upon redemption (including in connection with
an offer to purchase) or otherwise;
(c) the Issuers fail for a period of 20 days to observe or
perform any covenant, condition or agreement on the part of the Issuers to
be observed or performed pursuant to Sections 4.07, 4.09, 4.10, 4.14 and
5.01 hereof;
(d) the Issuers or the Guarantor fail to comply with any of
their other respective agreements or covenants in, or provisions of, the
Senior Notes, the Subsidiary Guarantee or this Indenture and the Default
continues for the period and after the notice specified below;
(e) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Partnership or any of
its Subsidiaries (or the payment of which is Guaranteed by the Partnership
or any of its Subsidiaries), whether such Indebtedness or Guarantee now
exists or shall be created hereafter, which default (i) is caused by a
failure to pay principal of or premium, if any, or interest on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness (a "Payment Default") or (ii) results in the acceleration of
such Indebtedness prior to its express maturity and, in each case, the
principal amount of such Indebtedness, together with the principal amount
of any other Indebtedness as to which there has been a Payment Default or
the maturity of which has been so accelerated, aggregates $10 million or
more;
(f) a final judgment or final judgments for the payment of money
are entered by a court or courts of competent jurisdiction against the
Partnership or any of its Subsidiaries and such judgments are not paid,
discharged or stayed for a period of 60 days, provided that the aggregate
of all such undischarged judgments exceeds $10 million;
(g) except as otherwise permitted hereunder, the Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or
the Guarantor (or its successors or assigns), or any Person acting on
behalf of the Guarantor (or its successors or assigns), shall deny or
disaffirm its obligations under the Subsidiary Guarantee;
(h) the Partnership breaches any material representation or
warranty set forth in the Pledge Agreement, or default by the Partnership
in the performance of any covenant set forth in the Pledge Agreement after
applicable grace periods, or repudiation by the Partnership of its
obligations under
41
the Pledge Agreement or the unenforceability of any material provision of
the Pledge Agreement for any reason;
(i) the Partnership or any of its Subsidiaries pursuant to or
within the meaning of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against
it in an involuntary case,
(iii) consents to the appointment of a Custodian of it or
for all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become
due; or
(j) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief against the Partnership or any
Subsidiary of the Partnership in an involuntary case,
(ii) appoints a Custodian of the Partnership or any
Subsidiary of the Partnership or for all or substantially all of the
property of the Partnership or any Subsidiary of the Partnership, or
(iii) orders the liquidation of the Partnership or
any Subsidiary of the Partnership,
and the order or decree remains unstayed and in effect for 60 consecutive
days.
A Default under clause (d) is not an Event of Default until the
Trustee notifies the Issuers, or the Holders of at least 25% in principal amount
of the then outstanding Senior Notes notify the Issuers and the Trustee, of the
Default and the Issuers do not cure the Default within 60 days after receipt of
the notice. The notice must specify the Default, demand that it be remedied and
state that the notice is a "Notice of Default."
In the case of any Event of Default pursuant to the provisions of
this Section 6.01 occurring by reason of any willful action (or inaction) taken
(or not taken) by or on behalf of the Issuers with the intention of avoiding
payment of the premium that the Issuers would have had to pay if the Issuers
then had elected to redeem the Senior Notes pursuant to Section 3.07 hereof, an
equivalent premium shall also become and be immediately due and payable to the
extent permitted by law, anything in this Indenture or in the Senior Notes to
the contrary notwithstanding. If an Event of Default occurs prior to June 15,
2001 by reason of any willful action (or inaction) taken (or not taken) by or on
behalf of the Issuers with the intention of avoiding the prohibition on
redemption of the Senior Notes prior to June 15, 2001 pursuant to Section 3.07
hereof, then the premium payable for purposes of this paragraph for each of the
years beginning on June 15 of the years set forth below shall be as set forth in
the following table expressed as a percentage of the amount that would otherwise
be due but for the provisions of this sentence, plus accrued interest and
Liquidated Damages, if any, to the date of payment:
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Year......................................Percentage
1996......................................109.3750%
1997......................................108.4375%
1998......................................107.5000%
1999......................................106.5625%
2000......................................105.6250%
SECTION 6.02. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clauses (i) and (j) of Section 6.01 hereof relating to either Issuer, any
Significant Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary) occurs and is continuing, the Trustee by
notice to the Issuers, or the Holders of at least 25% in principal amount of the
then outstanding Senior Notes by written notice to the Issuers and the Trustee
may declare the unpaid principal of, any accrued interest and Liquidated
Damages, if any, on all the Senior Notes to be due and payable. Upon such
declaration the principal, interest and Liquidated Damages, if any, shall be due
and payable immediately (together with the premium referred to in Section 6.01
hereof, if applicable). If an Event of Default specified in clause (i) or (j) of
Section 6.01 hereof relating to either Issuer, any Significant Subsidiary or any
group of Subsidiaries that, taken together, would constitute a Significant
Subsidiary occurs, such an amount shall ipso facto become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. The Holders of a majority in principal amount of the then
outstanding Senior Notes by written notice to the Trustee may rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or Liquidated Damages, if any, that has become due solely
because of the acceleration) have been cured or waived.
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal of, premium, if
any, interest and Liquidated Damages, if any, on the Senior Notes or to enforce
the performance of any provision of the Senior Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Senior Notes or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Holder of a Senior Note in exercising any
right or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. All
remedies are cumulative to the extent permitted by law.
SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the Senior Notes then outstanding by notice to the Trustee may on behalf of the
Holders of all of the Senior Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium, if any, interest or Liquidated
Damages, if any, on the Senior Notes (including in connection with an offer to
purchase) (provided, however, that the Holders of a majority in aggregate
principal amount of the then outstanding Senior Notes may rescind an
acceleration and its consequences, including any related payment default that
resulted from such
43
acceleration). Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Senior Notes may direct the time, method and place of conducting any proceeding
for exercising any remedy available to the Trustee or exercising any trust or
power conferred on it. However, the Trustee may refuse to follow any direction
that conflicts with law or this Indenture or that the Trustee determines may be
unduly prejudicial to the rights of other Holders of Senior Notes or that may
involve the Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Senior Note may pursue a remedy with respect to this
Indenture or the Senior Notes only if:
(a) the Holder of a Senior Note gives to the Trustee written
notice of a continuing Event of Default or the Trustee receives such
notice from either Issuer;
(b) the Holders of at least 25% in principal amount of the then
outstanding Senior Notes make a written request to the Trustee to pursue
the remedy;
(c) such Holder of a Senior Note or Holders of Senior Notes
offer and, if requested, provide to the Trustee indemnity satisfactory to
the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Senior Notes do not give the
Trustee a direction inconsistent with the request; provided, however, that
such provision does not affect the right of a Holder of a Senior Note to
sue for enforcement of any overdue payment thereon.
A Holder of a Senior Note may not use this Indenture to prejudice the rights of
another Holder of a Senior Note or to obtain a preference or priority over
another Holder of a Senior Note.
SECTION 6.07. RIGHTS OF HOLDERS OF SENIOR NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Senior Note to receive payment of principal of, premium, if any,
interest, and Liquidated Damages, if any, on the Senior Note, on or after the
respective due dates expressed in the Senior Note (including in connection with
an Asset Sale Offer or a Change of Control Offer), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
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SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) hereof
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Issuers for the whole
amount of principal of, premium, if any, interest, and Liquidated Damages, if
any, remaining unpaid on the Senior Notes and interest on overdue principal and,
to the extent lawful, interest and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Senior Notes allowed in any judicial proceedings relative to the
Issuers (or any other obligor upon the Senior Notes, including the Guarantor),
its creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Senior Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expenses
and liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Senior Notes for amounts due and unpaid on
the Senior Notes for principal, premium, if any, interest, and Liquidated
Damages, if any, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Senior Notes for
principal, premium, if any, interest and Liquidated Damages, if any,
respectively; and
Third: to the Partnership or to such party as a court of
competent jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any payment to
Holders of Senior Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Senior Note pursuant to Section 6.07 hereof, or a suit by Holders of more than
10% in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b)
of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
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(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuers.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed by
it to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
from either Issuer an Officers' Certificate or an Opinion of Counsel or both.
The Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate or Opinion of Counsel. The
Trustee may consult with counsel and the written advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection from
liability in respect of any action taken, suffered or omitted by it hereunder in
good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from either Issuer shall be sufficient if
signed by an Officer of the General Partner (in the case of the Partnership) or
by an Officer of Finance Corp. (in the case of Finance Corp.)
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
(g) Except with respect to Section 4.01 and 4.04 hereof, the Trustee
shall have no duty to inquire as to the performance of the Issuers' covenants in
Article 4 hereof. In addition, the Trustee shall not be deemed to have knowledge
any Default or Event of Default except (i) any Event of Default occurring
pursuant to Sections 6.01(1), 6.01(2) or 6.01(3) hereof or (ii) any Default or
Event of Default of which the Trustee shall have received written notification
or obtained actual knowledge.
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SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Senior Notes and may otherwise deal with either Issuer, the
Guarantor or any Affiliate of either Issuer or the Guarantor with the same
rights it would have if it were not Trustee. However, in the event that the
Trustee acquires any conflicting interest it must eliminate such conflict within
90 days, apply to the SEC for permission to continue as trustee or resign. Any
Agent may do the same with like rights and duties.
The Trustee is also subject to Sections 7.10 and 7.11 hereof.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Senior Notes, it shall
not be accountable for the Issuers' use of the proceeds from the Senior Notes or
any money paid to the Issuers or upon the Issuers' direction under any provision
of this Indenture, it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Senior
Notes or any other document in connection with the sale of the Senior Notes or
pursuant to this Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to Holders of Senior Notes a
notice of the Default or Event of Default within 90 days after it occurs. Except
in the case of a Default or Event of Default in payment of principal of,
premium, if any, or interest including Liquidated Damages on any Senior Note
(including any failure to make any mandatory redemption payment required
hereunder), the Trustee may withhold the notice if and so long as a committee of
its Responsible Officers in good faith determines that withholding the notice is
in the interests of the Holders of the Senior Notes.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE SENIOR NOTES.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Senior Notes remain outstanding,
the Trustee shall mail to the Holders of the Senior Notes a brief report dated
as of such reporting date that complies with TIA ss. 313(a) (but if no event
described in TIA ss. 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA ss. 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Senior Notes shall be mailed to the Issuers and filed with the SEC and each
stock exchange on which the Senior Notes are listed in accordance with TIA ss.
313(d). The Issuers shall promptly notify the Trustee when the Senior Notes are
listed on any stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Issuers and the Guarantor shall pay to the Trustee from time to
time reasonable compensation for its acceptance of this Indenture and its
services hereunder. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Issuers and the Guarantor
shall reimburse the Trustee promptly upon request for all reasonable
disbursements, advances
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and expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Issuers and the Guarantor shall indemnify the Trustee against any
and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Issuers and the Guarantor (including this Section 7.07), and defending
itself against any claim (whether asserted by either Issuer, the Guarantor or
any Holder or any other person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its negligence or bad
faith. The Trustee shall notify the Issuers promptly of any claim for which it
may seek indemnity. Failure by the Trustee to so notify the Issuers shall not
relieve the Issuers and the Guarantor of their obligations hereunder. The
Issuers and the Guarantor shall defend the claim and the Trustee shall cooperate
in the defense. The Trustee may have separate counsel and the Issuers and the
Guarantor shall pay the reasonable fees and expenses of such counsel. The
Issuers and the Guarantor need not pay for any settlement made without their
consent, which consent shall not be unreasonably withheld.
The obligations of the Issuers and the Guarantor under this Section
7.07 shall survive the satisfaction and discharge of this Indenture.
To secure the Issuers' and the Guarantor's payment obligations in
this Section, the Trustee shall have a Lien prior to the Senior Notes on all
money or property held or collected by the Trustee, except that held in trust to
pay principal and interest on particular Senior Notes. Such Lien shall survive
the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(i) or (j) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Issuers. The Holders of Senior
Notes of a majority in principal amount of the then outstanding Senior Notes may
remove the Trustee by so notifying the Trustee and the Issuers in writing.
The Issuers may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee
or its property; or
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(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Senior Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Issuers.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers, the
Guarantor, or the Holders of Senior Notes of at least 10% in principal amount of
the then outstanding Senior Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Senior Note
who has been a Holder of a Senior Note for at least six months, fails to comply
with Section 7.10 hereof, such Holder of a Senior Note may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Senior Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Issuers' and the Guarantor's obligations
under Section 7.07 hereof shall continue for the benefit of the retiring
Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $50 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUERS.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
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ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Issuers may, at the option of the Board of Directors and the
Board of Directors of Finance Corp. evidenced in each case by a resolution set
forth in an Officers' Certificate, at any time elect to have either Section 8.02
or 8.03 hereof be applied to all outstanding Senior Notes upon compliance with
the conditions set forth below in this Article 8.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Issuers' exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, each of the Issuers and the Guarantor shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from its obligations with respect to all
outstanding Senior Notes and Subsidiary Guarantee on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Issuers shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Senior Notes,
which shall thereafter be deemed to be "outstanding" only for the purposes of
Section 8.05 hereof and the other Sections of this Indenture referred to in (a)
and (b) below, and to have satisfied all their other obligations under such
Senior Notes and this Indenture (and the Trustee, on demand of and at the
expense of the Issuers, shall execute proper instruments acknowledging the
same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder: (a) the rights of Holders of outstanding
Senior Notes to receive solely from the trust fund described in Section 8.04
hereof, and as more fully set forth in such Section, payments in respect of the
principal of, premium, if any, and interest including Liquidated Damages, if
any, on such Senior Notes when such payments are due, (b) the Issuers' and
Guarantor's obligations with respect to such Senior Notes under Article 2 and
Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of
the Trustee hereunder and the Issuers' and the Guarantor's obligations in
connection therewith and (d) this Article 8. Subject to compliance with this
Article 8, the Issuers may exercise their option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Issuers' exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, each of the Issuers and the Guarantor shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be released from its obligations under the covenants contained in Sections 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16, 4.17, 4.18 and 5.01 hereof with
respect to the outstanding Senior Notes and the Subsidiary Guarantee on and
after the date the conditions set forth below are satisfied (hereinafter,
"Covenant Defeasance"), and the Senior Notes shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or declaration
or act of Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed "outstanding" for all other purposes
hereunder (it being understood that such Senior Notes shall not be deemed
outstanding for accounting purposes). For this purpose, Covenant Defeasance
means that, with respect to the outstanding Senior Notes, the Issuers may omit
to comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event
of Default under Section 6.01 hereof, but, except
51
as specified above, the remainder of this Indenture, such Senior Notes and the
Subsidiary Guarantee shall be unaffected thereby. In addition, upon the Issuers'
exercise under Section 8.01 hereof of the option applicable to this Section 8.03
hereof, subject to the satisfaction of the conditions set forth in Section 8.04
hereof, Sections 6.01(e) and 6.01(f) hereof shall not constitute Events of
Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Senior Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Issuers or the Guarantor shall irrevocably have
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Senior Notes, (i) cash in U.S. Dollars in an amount, or
(ii) non-callable Government Securities which through the scheduled
payment of principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the due date of
any payment, cash in U.S. Dollars in an amount, or (iii) a combination
thereof, in such amounts, as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee, to pay and
discharge and which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge (A) the principal of, premium, if any,
interest, including Liquidated Damages, if any, on the outstanding Senior
Notes on the stated maturity or on the applicable redemption date, as the
case may be, of such principal or installment of principal, premium, if
any, or interest including Liquidated Damages, if any, and (B) any
mandatory sinking fund payments or analogous payments applicable to the
outstanding Senior Notes on the day on which such payments are due and
payable in accordance with the terms of this Indenture and of such Senior
Notes; provided that the Trustee shall have been irrevocably instructed to
apply such money or the proceeds of such non-callable Government
Securities to said payments with respect to the Senior Notes;
(b) in the case of an election under Section 8.02 hereof, the
Issuers or the Guarantor shall have delivered to the Trustee an Opinion of
Counsel (which counsel may be an employee of either Issuer or any
Subsidiary of either Issuer) reasonably acceptable to the Trustee
confirming that (i) the Issuers have received from, or there has been
published by, the Internal Revenue Service a ruling or (ii) since the date
of this Indenture, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Holders of the outstanding
Senior Notes will not recognize income, gain or loss for federal income
tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Legal Defeasance had not
occurred;
(c) in the case of an election under Section 8.03 hereof, the
Issuers or the Guarantor shall have delivered to the Trustee an Opinion of
Counsel (which counsel may be an employee of either Issuer or any
Subsidiary of either Issuer) reasonably acceptable to the Trustee
confirming that the Holders of the outstanding Senior Notes will not
recognize income, gain or loss for federal income tax purposes as a result
of such Covenant Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such Covenant Defeasance had not occurred;
52
(d) no Event of Default shall have occurred and be continuing on
the date of such deposit or, insofar as Sections 6.01(i) or 6.01(j) hereof
is concerned, at any time in the period ending on the 91st day after the
date of deposit (or greater period of time in which any such deposit of
trust funds may remain subject to Bankruptcy Law insofar as those apply to
the deposit by the Issuers);
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this Indenture) to which
either Issuer or any of their Subsidiaries is a party or by which either
Issuer or any of their Subsidiaries is bound;
(f) the Issuers or the Guarantor shall have delivered to the
Trustee an opinion of counsel to the effect that after the 91st day
following the deposit, the trust funds will not be subject to the effect
of any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally;
(g) the Issuers or the Guarantor shall have delivered to the
Trustee an Officers' Certificate stating that the deposit was not made by
the Issuers or the Guarantor with the intent of preferring the Holders
over any other creditors of the Issuers or the Guarantor or with the
intent of defeating, hindering, delaying or defrauding any other creditors
of the Issuers or others; and
(h) the Issuers or the Guarantor shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent provided for or relating to the Legal
Defeasance or the Covenant Defeasance have been complied with as
contemplated hereby.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Senior
Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Senior Notes and this Indenture, to the payment, either
directly or through any Paying Agent (including either Issuer acting as Paying
Agent) as the Trustee may determine, to the Holders of such Senior Notes of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest, including Liquidated Damages, if any, but such money need not be
segregated from other funds except to the extent required by law.
The Issuers and the Guarantor shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the cash or
non-callable Government Securities deposited pursuant to Section 8.04 hereof or
the principal and interest received in respect thereof other than any such tax,
fee or other charge which by law is for the account of the Holders of the
outstanding Senior Notes.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon the request
of the Issuers any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
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SECTION 8.06. REPAYMENT TO ISSUERS.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Issuers, in trust for the payment of the principal of, premium, if
any, interest or Liquidated Damages, if any, on any Senior Note and remaining
unclaimed for two years after such principal, and premium, if any, interest or
Liquidated Damages, if any, have become due and payable shall be paid to the
Issuers on its request or (if then held by the Issuers) shall be discharged from
such trust; and the Holder of such Senior Note shall thereafter, as an unsecured
general creditor, look only to the Issuers for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Issuers as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Issuers cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Issuers.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' and the Guarantor's obligations under this
Indenture, the Senior Notes and the Subsidiary Guarantee shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
hereof until such time as the Trustee or Paying Agent is permitted to apply all
such money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Issuers and the Guarantor make any payment of
principal of, premium, if any, interest or Liquidated Damages, if any, on any
Senior Note following the reinstatement of its obligations, the Issuers and the
Guarantor shall be subrogated to the rights of the Holders of such Senior Notes
to receive such payment from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF SENIOR NOTES.
Notwithstanding Section 9.02 of this Indenture, the Issuers, the
Guarantor and the Trustee may amend or supplement this Indenture or the Senior
Notes or the Subsidiary Guarantee or the Pledge Agreement without the consent of
any Holder of a Senior Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Senior Notes in addition to
or in place of certificated Senior Notes;
(c) to provide for the assumption of the Partnership's, Finance
Corp.'s or the Guarantor's obligations to the Holders of the Senior Notes
in the case of a merger or consolidation pursuant to Article 5 or Article
12 hereof, as the case may be;
54
(d) to make any change that would provide any additional rights
or benefits to the Holders of the Senior Notes or that does not adversely
affect the legal rights hereunder of any Holder of the Senior Note; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
Upon the request of the Issuers accompanied by a resolution of the
Board of Directors of each of the General Partner and Finance Corp. authorizing
the execution of any such amended or supplemental Indenture, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Issuers and the Guarantor in the execution of any amended or
supplemental Indenture authorized or permitted by the terms of this Indenture
and make any further appropriate agreements and stipulations that may be therein
contained, but the Trustee shall not be obligated to enter into such amended or
supplemental Indenture that affects its own rights, duties or immunities under
this Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF SENIOR NOTES.
Except as provided below in this Section 9.02, the Issuers, the
Guarantor and the Trustee may amend or supplement this Indenture or the Senior
Notes or the Subsidiary Guarantee or the Pledge Agreement with the written
consent of the Holders of at least a majority in principal amount of the Senior
Notes then outstanding (including consents obtained in connection with a tender
offer or exchange offer for the Senior Notes), and, subject to Sections 6.04 and
6.07 hereof, any existing Default or Event of Default (other than a Default or
Event of Default in the payment of the principal of, premium, if any, interest
or Liquidated Damages, if any, on the Senior Notes, except a payment default
resulting from an acceleration that has been rescinded) or compliance with any
provision of this Indenture or the Senior Notes may be waived with the consent
of the Holders of a majority in principal amount of the then outstanding Senior
Notes (including consents obtained in connection with a tender offer or exchange
offer for the Senior Notes).
Upon the request of the Issuers accompanied by a resolution of the
Board of Directors of each of the General Partner and Finance Corp. authorizing
the execution of any such amended or supplemental Indenture, and upon the filing
with the Trustee of evidence satisfactory to the Trustee of the consent of the
Holders of Senior Notes as aforesaid, and upon receipt by the Trustee of the
documents described in Section 7.02 hereof, the Trustee shall join with the
Issuers and the Guarantor in the execution of such amended or supplemental
Indenture unless such amended or supplemental Indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Senior
Notes under this Section 9.02 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Issuers shall mail to the Holders of Senior Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Issuers to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the
Holders of a majority in aggregate principal amount of the Senior Notes then
outstanding may waive compliance in a particular instance by the Issuers
55
or the Guarantor with any provision of this Indenture, the Senior Note, the
Pledge Agreement or the Subsidiary Guarantee. However, without the consent of
each Holder affected, an amendment or waiver may not (with respect to any Senior
Notes held by a non-consenting Holder):
(a) reduce the principal amount of Senior Notes whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any
Senior Note or alter any of the provisions with respect to the redemption
of the Senior Notes (other than provisions of Section 4.10 and Section
4.14 hereof);
(c) reduce the rate of or change the time for payment of
interest, including default interest and Liquidated Damages, if any, on
any Senior Note;
(d) waive a Default or Event of Default in the payment of
principal of, premium, if any, interest or Liquidated Damages, if any, on
the Senior Notes (except a rescission of acceleration of the Senior Notes
by the Holders of at least a majority in aggregate principal amount of the
then outstanding Senior Notes and a waiver of the payment default that
resulted from such acceleration);
(e) make any Senior Note payable in money other than that
stated in the Senior Notes;
(f) make any change in Section 6.04 or 6.07 hereof or in the
provisions of this Indenture relating to the rights of Holders of Senior
Notes to receive payments of principal of, premium, if any, interest or
Liquidated Damages, if any, on the Senior Notes;
(g) waive a redemption payment with respect to any Senior Note
(other than a payment required by Section 4.10 or Section 4.14 hereof);
(h) except as otherwise permitted in this Indenture, release the
Guarantor from its obligations under the Subsidiary Guarantee or change
the Subsidiary Guarantee in any manner that adversely affects Holders;
(i) release all or substantially all of the Pledged Collateral
from the Lien of the Indenture and the Pledge Agreement; or
(j) make any change in this sentence of this Section 9.02.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Senior Notes
shall be set forth in an amended or supplemental Indenture that complies with
the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Senior Note is a continuing consent by the Holder of a
Senior Note and every subsequent Holder of a Senior Note or portion of a Senior
Note that evidences the same debt as the consenting Holder's Senior Note, even
if notation of the consent is not made on any Senior Note. However, any such
Holder of a Senior Note or subsequent Holder of a Senior Note may revoke the
consent as to its Senior Note if the
56
Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or waiver
becomes effective in accordance with its terms and thereafter binds every
Holder.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SENIOR NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Senior Note thereafter authenticated. The Issuers in
exchange for all Senior Notes may issue and the Trustee shall authenticate new
Senior Notes (accompanied by a notation of the Subsidiary Guarantee duly
endorsed by the Guarantor) that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Senior Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Issuers and the Guarantor may not sign an amendment or supplemental
Indenture until the Board of Directors of each of the General Partner and
Finance Corp. approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel stating that the execution of such amended or supplemental
indenture is authorized or permitted by this Indenture.
ARTICLE 10
COLLATERAL AND SECURITY
SECTION 10.01. PLEDGE AGREEMENT.
The due and punctual payment of the principal of, premium, if any,
interest, and Liquidated Damages, if any, on the Senior Notes when and as the
same shall be due and payable, whether at maturity, by acceleration, repurchase
or otherwise, and interest on the overdue principal of, premium, if any,
interest, and Liquidated Damages, if any, on the Senior Notes and performance of
all other obligations of the Issuers to the Holders of Senior Notes or the
Trustee under this Indenture and the Senior Notes, according to the terms
hereunder or thereunder, shall be secured as provided in the Pledge Agreement
that the Partnership and the General Partner have entered into simultaneously
with the execution of this Indenture. Each Holder of Senior Notes, by its
acceptance thereof, consents and agrees to the terms of the Pledge Agreement
(including, without limitation, the provisions providing for foreclosure and
release of Pledged Collateral) as the same may be in effect or may be amended
from time to time in accordance with its terms and authorizes and directs the
Collateral Agent to enter into the Pledge Agreement and to perform its
obligations and exercise its rights thereunder in accordance therewith. The
Partnership shall deliver to the Trustee copies of all documents delivered to
the Collateral Agent pursuant to the Pledge Agreement, and shall do or cause to
be done all such acts and things as may be necessary or proper, or as may be
required by the provisions of the Pledge Agreement, to assure and confirm to the
Trustee and the Collateral Agent the security interest in the Pledged Collateral
contemplated hereby, by the Pledge Agreement or any part thereof, as from time
to time constituted, so as to render the same available for the security and
benefit of this Indenture and of the Senior Notes
57
secured hereby, according to the intent and purposes herein expressed. The
Partnership shall take, or shall cause its Subsidiaries to take, upon request of
the Trustee, any and all actions reasonably required to cause the Pledge
Agreement to create and maintain, as security for the Obligations of the Issuers
hereunder, a valid and enforceable perfected first priority Lien in and on all
the Pledged Collateral, in favor of the Collateral Agent for the benefit of the
Holders of Senior Notes, superior to and prior to the rights of all third
Persons and subject to no other Liens, other than as permitted by the Pledge
Agreement.
SECTION 10.02. RECORDING AND OPINIONS.
(a) The Partnership shall furnish to the Trustee simultaneously with
the execution and delivery of this Indenture an Opinion of Counsel either (i)
stating that in the opinion of such counsel all action has been taken with
respect to the recording, registering and filing of this Indenture, financing
statements or other instruments necessary to make effective the Lien intended to
be created by the Pledge Agreement, and reciting with respect to the security
interests in the Pledged Collateral, the details of such action, or (ii) stating
that, in the opinion of such counsel, no such action is necessary to make such
Lien effective.
(b) The Partnership shall furnish to the Collateral Agent and the
Trustee on April 26 in each year beginning with April 26, 1996, an Opinion of
Counsel, dated as of such date, either (i) (A) stating that, in the opinion of
such counsel, action has been taken with respect to the recording, registering,
filing, re-recording, re-registering and refiling of all supplemental
indentures, financing statements, continuation statements or other instruments
of further assurance as is necessary to maintain the Lien of the Pledge
Agreement and reciting with respect to the security interests in the Pledged
Collateral the details of such action or referring to prior Opinions of Counsel
in which such details are given and (B) stating that, based on relevant laws as
in effect on the date of such Opinion of Counsel, all financing statements and
continuation statements have been executed and filed that are necessary as of
such date and during the succeeding 12 months fully to preserve and protect, to
the extent such protection and preservation are possible by filing, the rights
of the Holders of Senior Notes and the Collateral Agent and the Trustee
hereunder and under the Pledge Agreement with respect to the security interests
in the Pledged Collateral, or (ii) stating that, in the opinion of such counsel,
no such action is necessary to maintain such Lien.
(c) The Issuers shall otherwise comply with the provisions of TIA
ss.314(b). SECTION 10.03. RELEASE OF COLLATERAL.
(a) Subject to subsections (b), (c) and (d) of this Section 10.03,
Pledged Collateral may be released from the Lien and security interest created
by the Pledge Agreement at any time or from time to time in accordance with the
provisions of the Pledge Agreement or as provided hereby.
(b) No Pledged Collateral shall be released from the Lien and
security interest created by the Pledge Agreement pursuant to the provisions of
the Pledge Agreement unless there shall have been delivered to the Collateral
Agent an Officers' Certificate certifying that all conditions precedent
hereunder have been met. Upon receipt of such Officers' Certificate the
Collateral Agent shall execute, deliver or acknowledge any necessary or proper
instruments of termination, satisfaction or release to evidence the release of
any Pledged Collateral permitted to be released pursuant to this Indenture or
the Pledge Agreement.
58
(c) At any time when an Event of Default shall have occurred and be
continuing and the maturity of the Senior Notes shall have been accelerated
(whether by declaration or otherwise) and the Trustee shall have delivered a
notice of acceleration to the Collateral Agent, no release of Pledged Collateral
pursuant to the provisions of the Pledge Agreement shall be effective as against
the Holders of Senior Notes.
(d) The release of any Pledged Collateral from the terms of this
Indenture and the Pledge Agreement shall not be deemed to impair the security
under this Indenture in contravention of the provisions hereof if and to the
extent the Pledged Collateral is released pursuant to the terms hereof or of the
Pledge Agreement. To the extent applicable, the Issuers shall cause TIA ss.
313(b), relating to reports, and TIA ss. 314(d), relating to the release of
property or securities from the Lien and security interest of the Pledge
Agreement and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Pledge
Agreement, to be complied with. Any certificate or opinion required by TIA ss.
314(d) may be made by an Officer of the General Partner, on behalf of the
Partnership, except in cases where TIA ss. 314(d) requires that such certificate
or opinion be made by an independent Person, which Person shall be an
independent engineer, appraiser or other expert selected or approved by the
Trustee and the Collateral Agent in the exercise of reasonable care.
SECTION 10.04. CERTIFICATES OF THE ISSUERS.
The Issuers shall furnish to the Trustee and the Collateral Agent,
prior to each proposed release of Pledged Collateral pursuant to the Pledge
Agreement, (i) all documents required by TIA ss.314(d) and (ii) an Opinion of
Counsel, which may be rendered by internal counsel to the Issuers, to the effect
that such accompanying documents constitute all documents required by TIA
ss.314(d). The Trustee may, to the extent permitted by Sections 7.01 and 7.02
hereof, accept as conclusive evidence of compliance with the foregoing
provisions the appropriate statements contained in such documents and such
Opinion of Counsel.
SECTION 10.05. CERTIFICATES OF THE TRUSTEE.
In the event that the Partnership wishes to release Pledged
Collateral in accordance with the Pledge Agreement and has delivered the
certificates and documents required by the Pledge Agreement and Sections 10.03
and 10.04 hereof, the Trustee shall determine whether it has received all
documentation required by TIA ss.314(d) in connection with such release and,
based on such determination and the Opinion of Counsel delivered pursuant to
Section 10.04, shall deliver a certificate to the Collateral Agent setting forth
such determination.
SECTION 10.06. AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE TRUSTEE UNDER THE
PLEDGE AGREEMENT.
Subject to the provisions of Section 7.01 and 7.02 hereof, the
Trustee may, in its sole discretion and without the consent of the Holders of
Senior Notes, direct, on behalf of the Holders of Senior Notes, the Collateral
Agent to, take all actions it deems necessary or appropriate in order to (a)
enforce any of the terms of the Pledge Agreement and (b) collect and receive any
and all amounts payable in respect of the Obligations of the Issuers hereunder.
The Trustee shall have power to institute and maintain such suits and
proceedings as it may deem expedient to prevent any impairment of the Pledged
Collateral by any acts that may be unlawful or in violation of the Pledge
Agreement or this Indenture, and such suits and proceedings as the Trustee may
deem expedient to preserve or protect its interests and the interests of the
Holders of Senior Notes in the Pledged Collateral (including power to institute
and maintain suits
59
or proceedings to restrain the enforcement of or compliance with any legislative
or other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment,
rule or order would impair the security interest hereunder or be prejudicial to
the interests of the Holders of Senior Notes or of the Trustee).
SECTION 10.07. AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER THE
PLEDGE AGREEMENT.
The Trustee is authorized to receive any funds for the benefit of the
Holders of Senior Notes distributed under the Pledge Agreement, and to make
further distributions of such funds to the Holders of Senior Notes according to
the provisions of this Indenture.
SECTION 10.08. TERMINATION OF SECURITY INTEREST.
Upon the payment in full of all Obligations of the Issuers under this
Indenture and the Senior Notes, or upon Legal Defeasance, the Trustee shall, at
the request of the Issuers deliver a certificate to the Collateral Agent stating
that such Obligations have been paid in full, and instruct the Collateral Agent
to release the Liens pursuant to this Indenture and the Pledge Agreement.
ARTICLE 11
SUBORDINATION OF SUBSIDIARY GUARANTEE
SECTION 11.01.SUBSIDIARY GUARANTEE OBLIGATIONS SUBORDINATED TO SENIOR OPERATING
PARTNERSHIP INDEBTEDNESS.
The Issuers and the Operating Partnership agree and each Holder by
accepting a Senior Note agrees that:
(a) to the extent and in the manner hereinafter set forth in this
Article 11, the Subsidiary Guarantee Obligations are hereby expressly made
subordinate and subject in right of payment to the prior payment in full in cash
or Cash Equivalents of all Senior Operating Partnership Indebtedness;
(b) the subordination set forth in this Indenture is for the benefit
of the lenders under the Senior Operating Partnership Credit Agreement and other
holders of Senior Operating Partnership Indebtedness; and
(c) each holder of Senior Operating Partnership Indebtedness whether
now outstanding or hereafter created, incurred, assumed or guaranteed shall be
deemed to have extended or acquired such Senior Operating Partnership
Indebtedness in reliance upon the covenants and provisions contained in this
Indenture.
SECTION 11.02. SUBORDINATION OF SUBSIDIARY GUARANTEE UPON INSOLVENCY OR
LIQUIDATION PROCEEDINGS.
In the event of any Insolvency or Liquidation Proceeding:
(a) Upon any payment or distribution of assets or securities of any
kind or character, whether in cash, securities or other property, all Senior
Operating Partnership Indebtedness shall first be paid in
60
full in cash or Cash Equivalents before the Holders of the Senior Notes are
entitled to receive any payment or distribution of any cash, securities or other
property on account of principal of or interest on or other amounts constituting
Subsidiary Guarantee Obligations (except that so long as the Subsidiary
Guarantee Obligations are not treated in any Insolvency or Liquidation
Proceeding as part of the same class of claims as the Senior Operating
Partnership Indebtedness or any class of claim on a parity with or senior to the
Senior Operating Partnership Indebtedness for any payment or distribution, the
Holders of the Senior Notes may receive securities that are (i) subordinated at
least to the same extent as are the Subsidiary Guarantee Obligations to (a)
Senior Operating Partnership Indebtedness and (b) any securities issued in
exchange for Senior Operating Partnership Indebtedness and (ii) authorized by an
order or decree of a court of competent jurisdiction in an Insolvency or
Liquidation Proceeding which gives effect to the subordination of the Subsidiary
Guarantee Obligations to Senior Operating Partnership Indebtedness in a manner
and with an effect which would be required if this parenthetical clause were not
included in this paragraph; provided that the Senior Operating Partnership
Indebtedness is assumed by the new corporation, partnership or other entity, if
any, resulting from any such reorganization or readjustment and issuing such
securities);
(b) The holders of Senior Operating Partnership Indebtedness shall be
entitled to receive directly (pro rata on the basis of the respective amounts of
Senior Operating Partnership Indebtedness held by them), for application to the
payment thereof (to the extent necessary to pay all such Senior Operating
Partnership Indebtedness in full after giving effect to any substantially
concurrent payment to the holders of such Senior Operating Partnership
Indebtedness), any payment or distribution of any kind or character, whether in
cash, securities or other property (including any payment or distribution which
may be payable or deliverable by reason of the payment of any other Indebtedness
of the Operating Partnership being subordinated to the payment of the Subsidiary
Guarantee Obligations) which may be payable or deliverable in respect of the
Subsidiary Guarantee Obligations in any such Insolvency or Liquidation
Proceeding.
(c) In the event that, notwithstanding the foregoing provisions of
this Section 11.02, the Holders of the Senior Notes shall have received any
payment from or distribution of assets or securities of the Operating
Partnership or the estate created by the commencement of any such Insolvency or
Liquidation Proceeding, of any kind or character in respect of the Subsidiary
Guarantee Obligations, whether in cash, securities or other property (including
any payment or distribution which may be payable or deliverable by reason of the
payment of any other Indebtedness of the Operating Partnership being
subordinated to the payment of the Subsidiary Guarantee Obligations) before all
Senior Operating Partnership Indebtedness is paid in full, then and in such
event such payment or distribution shall be received and held in trust for and
shall be paid over or delivered to the holders of the Senior Operating
Partnership Indebtedness remaining unpaid (pro rata on the basis of the
respective amounts of such Senior Operating Partnership Indebtedness held by
them), to the extent necessary to pay all such Senior Operating Partnership
Indebtedness in full after giving effect to any substantially concurrent payment
to the holders of such Senior Operating Partnership Indebtedness, for
application to the payment in full of such Senior Operating Partnership
Indebtedness (except that so long as the Subsidiary Guarantee Obligations are
not treated in any Insolvency or Liquidation Proceeding as part of the same
class of claims as the Senior Operating Partnership Indebtedness or any class of
claim on a parity with or senior to the Senior Operating Partnership
Indebtedness for any payment or distribution, the Holders of the Senior Notes
may receive securities that are (i) subordinated at least to the same extent as
are the Subsidiary Guarantee Obligations to (a) Senior Operating Partnership
Indebtedness and (b) any securities issued in exchange for Senior Operating
Partnership Indebtedness and (ii) authorized by an order or decree of a court of
competent jurisdiction in an Insolvency or Liquidation Proceeding which gives
effect to the subordination of the Subsidiary Guarantee Obligations to Senior
Operating Partnership Indebtedness
61
in a manner and with an effect which would be required if this parenthetical
clause were not included in this paragraph; provided that the Senior Operating
Partnership Indebtedness is assumed by the new corporation, partnership or other
entity, if any, resulting from any such reorganization or readjustment and
issuing such securities);
SECTION 11.03. NO PAYMENT ON SUBSIDIARY GUARANTEE OBLIGATIONS IN CERTAIN
CIRCUMSTANCES.
(a) Upon the maturity of any Senior Operating Partnership
Indebtedness, by lapse of time, acceleration or otherwise (including the time of
due payment (including any mandatory prepayment) of any principal or interest),
all principal, thereof and interest thereon and other amounts constituting
Senior Operating Partnership Indebtedness shall first be paid in full in cash or
Cash Equivalents before any payment or distribution is made by or on behalf of
the Operating Partnership on account of principal of or interest on or other
amounts constituting Subsidiary Guarantee Obligations (except that Holders of
Senior Notes may receive securities that are subordinated to at least the same
extent as the Subsidiary Guarantee to (a) Senior Operating Partnership
Indebtedness and (b) any securities issued in exchange for Senior Operating
Partnership Indebtedness);
(b) Upon the happening and continuing of any default in respect of
the payment of any Senior Operating Partnership Indebtedness (a "Payment
Default"), no direct or indirect payment or distribution shall be made by the
Operating Partnership on account of the principal of or interest on or other
amounts constituting Subsidiary Guarantee Obligations (other than securities
that are subordinated to at least the same extent as the Subsidiary Guarantee to
(a) Senior Operating Partnership Indebtedness and (b) any securities issued in
exchange for Senior Operating Partnership Indebtedness), unless and until (i)
such Payment Default shall have been cured or waived by the holders of the
respective Senior Operating Partnership Indebtedness or shall have ceased to
exist or (ii) the holder or holders of the respective Senior Operating
Partnership Indebtedness shall have waived in writing the application of this
Section 11.03(b) to such Payment Default.
(c) Without limiting the effect of Section 11.03(b), upon the
happening and continuing of any default or event of default (other than a
Payment Default) with respect to any Senior Operating Partnership Indebtedness,
as such default or event of default is defined in the Senior Operating
Partnership Credit Agreement or in any instrument, agreement or other document
under which such Senior Operating Partnership Indebtedness is outstanding (a
"Non-Payment Default"), then upon written notice thereof given to the Operating
Partnership by the Senior Agent, by holders of a majority in principal amount of
the Indebtedness under the Senior Operating Partnership Credit Agreement or the
agreement governing Permitted Senior Refinancing Indebtedness, or by the holders
of a majority in principal amount of all Senior Operating Partnership
Indebtedness ("Payment Blockage Notice"), no direct or indirect payment or
distribution shall be made by the Operating Partnership on account of the
principal of or interest on or other amounts constituting Subsidiary Guarantee
Obligations (other than securities that are subordinated to at least the same
extent as the Subsidiary Guarantee to (a) Senior Operating Partnership
Indebtedness and (b) any securities issued in exchange for Senior Operating
Partnership Indebtedness) unless and until (i) such Non-Payment Default shall
have been cured or waived by the holder or holders of the respective Senior
Operating Partnership Indebtedness or shall have ceased to exist or (ii) the
holder or holders of the respective Senior Operating Partnership Indebtedness
shall have waived in writing the application of this Section 11.03(c) to such
Non-Payment Default; provided, however, that (A) this Section 11.03(c) shall not
prevent the making of any payment for more than 179 days after a Payment
Blockage Notice shall have been given or deemed to have been given ("Payment
Blockage Period") unless the Senior Operating Partnership Indebtedness in
respect of which such default or event of default exists has been declared due
and payable in its entirety, in which case no payment or
62
distribution may be made until such acceleration has been rescinded or annulled
and (B) not more than one effective Payment Blockage Notice shall be given
within a period of 360 consecutive days and there shall be a period of at least
181 consecutive days in each 360-day period when no Payment Blockage Period is
in effect.
(d) In the event that, notwithstanding the foregoing provisions of
Section 11.03 (a), (b) or (c) or Section 11.10, the Holders of the Senior Notes
shall have received any payment or distribution at a time when such payment was
prohibited by the provisions of Section 11.03 (a), (b) or (c) or required to be
paid over to the holders of the Senior Operating Partnership Indebtedness
pursuant to Section 11.10 then and in such event such payment or distribution
shall be received and held in trust for and shall be paid over to the holders of
Senior Operating Partnership Indebtedness (pro rata, on the basis of the
respective amounts of such Senior Operating Partnership Indebtedness held by
them), to the extent necessary to pay all such Senior Operating Partnership
Indebtedness in full after giving effect to any substantially concurrent payment
to the holders of such Senior Operating Partnership Indebtedness, for
application to the payment in full of Senior Operating Partnership Indebtedness.
(e) The provisions of this Section 11.03 shall not modify or limit in
any way the application of Section 11.02 or Section 11.10.
SECTION 11.04. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR OPERATING PARTNERSHIP
INDEBTEDNESS.
After all amounts payable under or in respect of Senior Operating
Partnership Indebtedness are paid in full, the Holders of the Senior Notes shall
be subrogated to the extent of the payments or distributions made to the holders
of, or otherwise applied to payment of, such Senior Operating Partnership
Indebtedness pursuant to the provisions of this Article 11, to the rights of the
holders of such Senior Operating Partnership Indebtedness to receive payments
and distributions of cash, securities and other property applicable to the
Senior Operating Partnership Indebtedness until the principal of, premium, if
any, and interest, including Liquidated Damages, if any, on the Senior Notes,
constituting the Subsidiary Guarantee Obligations shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of the
Senior Operating Partnership Indebtedness of any cash, securities or other
property to which the Holders of the Senior Notes would be entitled except for
the provisions of this Article 11, and no payments over pursuant to the
provisions of this Article 11 to the holders of the Senior Operating Partnership
Indebtedness by the Holders of the Senior Notes shall be deemed to be a payment
or distribution by the Operating Partnership to or on account of the Subsidiary
Guarantee Obligations, it being understood that the provisions of this Article
11, are solely for the purpose of defining the relative rights of the Holders of
the Senior Notes, on the one hand, and the holders of Senior Operating
Partnership Indebtedness on the other hand.
SECTION 11.05. EFFECTUATION OF SUBORDINATION OF SUBSIDIARY GUARANTEE.
In the event of any Insolvency or Liquidation Proceeding, the Senior
Agent is irrevocably authorized and empowered, in its discretion, to make and
present for and on behalf of the Holders of the Senior Notes such proofs of
claims against the Operating Partnership on account of the Subsidiary Guarantee
Obligations or other motions or pleadings as the Senior Agent may deem expedient
or proper; provided, however, the Senior Agent may make and present such proofs
of claims only if the Holders of the Senior Notes have not filed such proofs of
claims by the thirtieth day prior to the date on which such claims are required
to be filed. After such thirty-day period, if the Holders of the Senior Notes
have not filed such proofs of claims, the Holders of the Senior Notes
irrevocably authorizes and empowers the
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Senior Agent to file claims and take such other actions (other than vote such
proof of claims in such proceedings), in the name of the Senior Agent or the
Holders of the Senior Notes or otherwise, as the Senior Agent may deem necessary
or advisable for the enforcement of the Subsidiary Guarantee. In such event, the
Holders of the Senior Notes or Trustee will execute and deliver to the Senior
Agent such powers of attorney, assignments and other instruments or documents as
may be requested by the Senior Agent in order to enable such Senior Agent to
enforce any and all claims upon or with respect to the Subsidiary Guarantee
Obligations.
SECTION 11.06. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of the Senior Agent under the Senior Operating Partnership
Credit Agreement or any other holder of any Senior Operating Partnership
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Issuers or the Operating Partnership or by any act or failure to act by the
Senior Agent under the Senior Operating Partnership Credit Agreement or any such
holder or by any noncompliance by the Issuers or the Operating Partnership with
the terms, provisions and covenants of Article 11 of this Indenture, the
Subsidiary Guarantee or the Senior Operating Partnership Credit Agreement
regardless of any knowledge thereof which the Senior Agent or such other holder
thereof may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the Senior Agent under the Senior Operating Partnership Credit
Agreement and any other holders of Senior Operating Partnership Indebtedness
may, at any time and from time to time, without the consent of or notice to the
Holders of the Senior Notes or the Trustee, without incurring responsibility to
the Holders of the Senior Notes or the Trustee and without impairing or
releasing the subordination benefits provided in this Indenture or the
obligations provided by this Article 11 of the Holders of the Senior Notes to
the holders of Senior Operating Partnership Indebtedness, do any one or more of
the following to the extent permitted by the terms of this Indenture even if any
right to reimbursement or subrogation or other right or remedy of the Holders of
the Senior Notes is affected, impaired or extinguished thereby:
(a) change the manner, place or terms of payment or change or extend
the time of payment of, or renew, exchange, amend or alter, the terms of any
Senior Operating Partnership Indebtedness, any security therefor or guaranty
thereof or any liability of the Operating Partnership or any guarantor to such
holder, or any liability incurred directly or indirectly in respect thereof, or
otherwise amend, renew, exchange, modify or supplement in any manner Senior
Operating Partnership Indebtedness or any instrument evidencing or guaranteeing
or securing the same or any agreement under which Senior Operating Partnership
Indebtedness is outstanding;
(b) sell, exchange, release, surrender, realize upon, enforce or
otherwise deal with in any manner and any order any property pledged, mortgaged
or otherwise securing Senior Operating Partnership Indebtedness or any liability
of the Operating Partnership or any guarantor to such holder, or any liability
incurred directly or indirectly in respect thereof;
(c) settle or compromise any Senior Operating Partnership
Indebtedness or any other liability of the Operating Partnership or any
guarantor of the Senior Operating Partnership Indebtedness to such holder or any
security therefor or any liability incurred directly or indirectly in respect
thereof and apply any sums by whomsoever paid and however realized to any
liability (including, without limitation, Senior Operating Partnership
Indebtedness) in any manner or order; and
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(d) fail to take or to record or otherwise perfect, for any reason or
for no reason, any Lien securing Senior Operating Partnership Indebtedness by
whomsoever granted, exercise or delay in or refrain from exercising any right or
remedy against the Operating Partnership or any security or any guarantor or any
other Person, elect any remedy and otherwise deal freely with the Operating
Partnership and security and any guarantor of the Senior Operating Partnership
Indebtedness or any liability of the Issuers or the Operating Partnership or any
guarantor to such holder or any liability incurred directly or indirectly in
respect thereof.
Each Holder of the Senior Notes by purchasing or accepting the Senior
Notes waives any and all notice of the creation, modification, renewal,
extension or accrual of any Senior Operating Partnership Indebtedness to the
extent permitted by the terms of this Indenture and notice of or proof of
reliance by any holder of Senior Operating Partnership Indebtedness upon this
Indenture and the Senior Operating Partnership Indebtedness shall conclusively
be deemed to have been created, contracted or incurred in reliance upon this
Indenture, and all dealings between the Issuers or the Operating Partnership and
the holders of Senior Operating Partnership Indebtedness shall be deemed to have
been consummated in reliance upon this Indenture.
SECTION 11.07. RELIANCE ON COURT ORDERS; EVIDENCE OF STATUS.
Upon any payment or distribution of assets of the Operating
Partnership referred to in Section 11.02, the Holders of the Senior Notes shall
be entitled to rely upon a certificate of the receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution
delivered to the Trustee or such Holders for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Senior Operating Partnership Indebtedness and other indebtedness of the
Operating Partnership, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or
this Article 11.
SECTION 11.08. PAYMENT.
A payment by the Operating Partnership with respect to principal of
or interest on the Subsidiary Guarantee Obligations shall include, without
limitation, payment by the Operating Partnership of principal of and interest on
the Senior Notes, any depositing by the Operating Partnership of funds for the
defeasance of the Subsidiary Guarantee Obligations, any sinking fund and any
payment by the Operating Partnership on account of mandatory prepayment or
optional redemption provisions.
SECTION 11.09. RELATIVE RIGHTS.
This Article 11 defines the relative rights of Holders of Senior
Notes pursuant to the Subsidiary Guarantee and holders of Senior Operating
Partnership Indebtedness. Nothing in this Article 11 shall:
(1) impair, as between the Operating Partnership and Holders of
Senior Notes, the Subsidiary Guarantee Obligations of the Operating
Partnership, which are absolute and unconditional after the Subsidiary
Guarantee Effectiveness Date;
(2) affect the relative rights of Holders of Senior Notes and
creditors of the Operating Partnership other than their rights in relation
to holders of Senior Operating Partnership Indebtedness; or
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(3) prevent the Trustee or any Holder of Senior Notes from exercising
its available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Operating Partnership Indebtedness
to receive distributions and payments otherwise payable to Holders of
Senior Notes.
If the Operating Partnership fails because of this Article 11 to pay
principal of, premium, if any, interest, or Liquidated Damages, if any, on a
Senior Note on the due date in accordance with the terms of this Indenture and
the Subsidiary Guarantee, the failure is still a Default or Event of Default.
SECTION 11.10. RESTRICTIONS ON PAYMENTS OF PRINCIPAL.
Notwithstanding any other provision of this Indenture (including this
Article 11) or the Subsidiary Guarantee, the Issuers, the Operating Partnership
and the Holders of the Senior Notes agree that no payment shall be made by the
Operating Partnership in respect of the principal of the Senior Notes pursuant
to the Subsidiary Guarantee Obligations prior to July 1, 2000, whether upon
stated maturity, mandatory prepayment, acceleration, by deposit to any
defeasance account or otherwise; provided that, nothing set forth above in this
Section 11.10 shall prohibit the acceleration of the Subsidiary Guarantee
Obligations or the exercise of remedies in respect of the Subsidiary Guarantee
Obligations by the Trustee or the Holders of the Senior Notes in accordance with
the terms of this Indenture so long as (i) the Senior Agent shall have received
from the Trustee at least five (5) days prior written notice of such
acceleration or exercise of remedies, as the case may be, and (ii) any payment
or distribution of cash, securities or other property of any kind or character
to or for the benefit of Holders of the Senior Notes in respect of such
acceleration or the exercise of remedies shall promptly be paid over or
distributed to the holders of the Senior Operating Partnership Indebtedness
until the Senior Operating Partnership Indebtedness shall have been paid in full
in cash or Cash Equivalents (other than securities that are subordinated to at
least the same extent as the Subsidiary Guarantee to (a) Senior Operating
Partnership Indebtedness and (b) any securities issued in exchange for Senior
Operating Partnership Indebtedness) and, in furtherance of the foregoing, (x)
the provisions of Section 11.03(d) shall be applicable in such circumstances and
(y) the provisions of this Section 11.10 shall not modify or limit in any way
the application of Section 11.02 or 11.03.
ARTICLE 12
SUBSIDIARY GUARANTEE
SECTION 12.01. SUBSIDIARY GUARANTEE.
The Guarantor hereby unconditionally guarantees to each Holder of a
Senior Note authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
this Indenture, the Senior Notes or the obligations of the Issuers hereunder or
thereunder, that on and after the Subsidiary Guarantee Effectiveness Date: (a)
the principal of and premium, if any, and interest, including Liquidated
Damages, if any, on the Senior Notes shall be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of, premium, if any, and interest, including Liquidated
Damages, if any, on the Senior Notes, if lawful, and all other obligations of
the Issuers to the Holders or the Trustee hereunder or thereunder shall be
promptly paid in full or performed, all in accordance with the terms hereof and
thereof; and (b) in case of any extension of time of payment or renewal of any
Senior Notes or any of such other obligations, that the same shall be promptly
paid in full when due or performed in accordance with the terms of the extension
or renewal, whether at stated maturity, by acceleration or
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otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason on and after the Subsidiary
Guarantee Effectiveness Date, the Guarantor shall be obligated to pay the same
immediately. The Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Senior Notes or this Indenture, the absence of any action to enforce the same,
any waiver or consent by any Holder with respect to any provisions hereof or
thereof, the recovery of any judgment against the Issuers, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. The Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Issuers, any right to require a
proceeding first against the Issuers, protest, notice and all demands whatsoever
and covenants that this Subsidiary Guarantee shall not be discharged except by
complete performance of the obligations contained in the Senior Notes and this
Indenture. If any Holder or the Trustee is required by any court or otherwise to
return to the Issuers or the Guarantor, or any Custodian, Trustee, liquidator or
other similar official acting in relation to either the Issuers or Guarantor,
any amount paid by either to the Trustee or such Holder, this Subsidiary
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. The Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders of Senior Notes in respect of
any obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby. The Guarantor further agrees that, as between the Guarantor,
on the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article 6 of this Indenture for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby and (y) in the
event of any declaration of acceleration of such obligations as provided in
Article 6 of this Indenture, such obligations (whether or not due and payable)
shall forthwith become due and payable by the Guarantor for the purpose of this
Subsidiary Guarantee.
SECTION 12.02. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 12.01, the
Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form of Exhibit C shall be endorsed by an officer of the
General Partner, on behalf of the Guarantor, on each Senior Note authenticated
and delivered by the Trustee, that this Indenture shall be executed on behalf of
the Guarantor by the President or one of the Vice Presidents of the General
Partner and attested to by an Officer and that the Guarantor shall deliver to
the Trustee an Opinion of Counsel that the foregoing have been duly authorized,
executed and delivered by the general partner of the Guarantor and that the
Guarantor's Subsidiary Guarantee is a valid and legally binding obligation of
the Guarantor, enforceable against the Guarantor in accordance with its terms.
The Guarantor hereby agrees that the Subsidiary Guarantee set forth
in Section 12.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Senior Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Senior Note on which the Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Senior Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantee set forth in this Indenture on behalf of the Guarantor.
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SECTION 12.03. GUARANTOR MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
The Guarantor may not consolidate with or merge with or into (whether
or not the Guarantor is the surviving Person), another corporation, Person or
entity whether or not affiliated with the Guarantor unless:
(a) subject to the provisions of Section 12.04 hereof, the Person
formed by or surviving any such consolidation or merger (if other than the
Guarantor) assumes all the obligations of the Guarantor, pursuant to a
supplemental indenture in form and substance reasonably satisfactory to
the Trustee in respect of the Senior Notes, this Indenture and the
Guarantor's Subsidiary Guarantee;
(b) immediately after giving effect to such transaction, no Default
or Event of Default exists; and
(c) the Guarantor, or any Person formed by or surviving such
consolidation or merger, (i) would have Consolidated Net Worth
(immediately after giving effect to the transaction), equal to or greater
than the Consolidated Net Worth of the Guarantor immediately preceding the
transaction and (ii) would be permitted by virtue of the Guarantor's pro
forma Fixed Charge Coverage Ratio to incur, immediately after giving
effect to such transaction, at least $1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in the Credit
Facility and in Section 4.09 of the Operating Partnership Indenture.
Notwithstanding the foregoing, the Guarantor shall not be permitted to
consolidate with or merge with or into (whether or not the Guarantor is the
surviving Person), another corporation, Person or entity pursuant to the
preceding sentence if such consolidation or merger would not be permitted by
Section 5.01 hereof.
In case of any such consolidation or merger and upon the assumption
by the successor corporation, by supplemental indenture, executed and delivered
to the Trustee and satisfactory in form to the Trustee, of the Subsidiary
Guarantee endorsed upon the Senior Notes and the due and punctual performance of
all of the covenants and conditions of this Indenture to be performed by the
Guarantor, such successor corporation shall succeed to and be substituted for
the Guarantor with the same effect as if it had been named herein as a
Guarantor. Such successor corporation thereupon may cause to be signed any or
all of the Subsidiary Guarantees to be endorsed upon all of the Senior Notes
issuable hereunder which theretofore shall not have been signed by the Issuers
and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantee theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Subsidiary Guarantees had been
issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, nothing contained in
this Indenture or in any of the Senior Notes shall prevent any consolidation or
merger of the Guarantor with or into the Partnership, or shall prevent any sale
or conveyance of the property of the Guarantor as an entirety or substantially
as an entirety to the Partnership.
SECTION 12.04. RELEASE OF SUBSIDIARY GUARANTEE.
In the event of a sale or other disposition of all or substantially
all of the assets of the Guarantor to a third party in a transaction that does
not violate any provisions of this Indenture or the Pledge
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Agreement, by way of merger, consolidation or otherwise, or a sale or other
disposition (including, without limitation, by foreclosure) of all of the
Capital Interests of the Guarantor, then the Guarantor (in the event of a sale
or other disposition (including, without limitation, by foreclosure), by way of
such a merger, consolidation or otherwise, of all of the Capital Interests of
the Guarantor) or the corporation or partnership acquiring the property (in the
event of a sale or other disposition of all of the assets of the Guarantor)
shall be released and relieved of any obligations under the Subsidiary
Guarantee; provided that the Net Proceeds of such sale or other disposition are
applied in accordance with Section 4.10 hereof. Upon delivery by the General
Partner and Finance Corp. to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made by
the Partnership in accordance with the provisions of this Indenture, including
without limitation Section 4.10, the Trustee shall execute any documents
reasonably required in order to evidence the release of the Guarantor from its
obligations under the Subsidiary Guarantee.
SECTION 12.05. LIMITATION ON GUARANTOR LIABILITY.
For purposes hereof, the Guarantor's liability shall be that amount
from time to time equal to the aggregate liability of the Guarantor thereunder,
but shall be limited to the lesser of (i) the aggregate amount of the
Obligations of the Issuers under the Senior Notes and this Indenture and (ii)
the amount, if any, which would not have (A) rendered the Guarantor "insolvent"
(as such term is defined in the federal Bankruptcy Law and in the Debtor and
Creditor Law of the State of New York) or (B) left it with unreasonably small
capital at the time the Subsidiary Guarantee of the Senior Notes was entered
into and at the Subsidiary Guarantee Effectiveness Date, after giving effect to
the incurrence of existing Indebtedness immediately prior to such time; provided
that, it shall be a presumption in any lawsuit or other proceeding in which the
Guarantor is a party that the amount guaranteed pursuant to the Subsidiary
Guarantee is the amount set forth in clause (i) above unless any creditor, or
representative of creditors of the Guarantor, or debtor in possession or trustee
in bankruptcy of the Guarantor, otherwise proves in such a lawsuit that the
aggregate liability of the Guarantor is limited to the amount set forth in
clause (ii). In making any determination as to the solvency or sufficiency of
capital of the Guarantor in accordance with the previous sentence, any rights
the Guarantor may have, contractual or otherwise, shall be taken into account.
SECTION 12.06. "TRUSTEE" TO INCLUDE PAYING AGENT.
In case at any time any Paying Agent other than the Trustee shall
have been appointed by the Issuers and be then acting hereunder, the term
"Trustee" as used in this Article 12 shall in such case (unless the context
shall otherwise require) be construed as extending to and including such Paying
Agent within its meaning as fully and for all intents and purposes as if such
Paying Agent were named in this Article 12 in place of the Trustee.
SECTION 12.07. SUBORDINATION OF SUBSIDIARY GUARANTEE.
The obligations of the Guarantor under the Subsidiary Guarantee
pursuant to this Article 12 shall be junior and subordinated to all Senior
Operating Partnership Indebtedness as set forth in Article 11 of this Indenture.
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ARTICLE 13
MISCELLANEOUS
SECTION 13.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss.318(c), the imposed duties shall control.
SECTION 13.02. NOTICES.
Any notice or communication by the Issuers, the Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telex, telecopier or overnight air courier guaranteeing next day delivery, to
the others' address:
If to the Issuers or the Guarantor:
Ferrellgas Partners, L.P.
One Liberty Plaza
Liberty, Missouri 64068
Telecopier No.: (816) 792-6979
Attention: Danley K. Sheldon
With a copy to:
Bryan Cave LLP
One Kansas City Place
1200 Main Street, Suite 3500
Kansas City, Missouri 64105-2100
Telecopier No.: (816) 374-3300
Attention: Kendrick T. Wallace
If to the Trustee:
American Bank National Association
101 East Fifth Street
St. Paul, MN 55101-1860
Telecopier No.: (612) 229-6415
Attention: Corporate Trust Administration
The Issuers, the Guarantor or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
70
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If either Issuer or the Guarantor mails a notice or communication to
Holders, it shall mail a copy to the Trustee and each Agent at the same time.
SECTION 13.03. COMMUNICATION BY HOLDERS OF SENIOR NOTES WITH OTHER HOLDERS OF
SENIOR NOTES.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Senior Notes. The
Issuers, the Guarantor, the Trustee, the Registrar and anyone else shall have
the protection of TIA ss. 312(c).
SECTION 13.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Issuers or the Guarantor to
the Trustee to take any action under this Indenture, each of the Issuers or the
Guarantor shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 13.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 13.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.
SECTION 13.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether such covenant or condition
has been satisfied; and
71
(d) a statement as to whether, in the opinion of such Person,
such condition or covenant has been satisfied.
SECTION 13.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 13.07. NO PERSONAL LIABILITY OF LIMITED PARTNERS, DIRECTORS, OFFICERS,
EMPLOYEES AND STOCKHOLDERS.
No past, present or future limited partner of the Partnership or the
Guarantor or director, officer, employee, incorporator or stockholder of the
General Partner or Finance Corp., as such, shall have any liability for any
obligations of the Issuers or the Guarantor under the Senior Notes, the
Subsidiary Guarantee, the Pledge Agreement, this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder of Senior Notes by accepting a Senior Note waives and releases all
such liability. The waiver and release are part of the consideration for
issuance of the Senior Notes.
SECTION 13.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE SENIOR NOTES AND THE SUBSIDIARY GUARANTEE.
SECTION 13.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Issuers or their Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 13.10. SUCCESSORS.
All agreements of the Issuers and the Guarantor in this Indenture and
the Senior Notes and the Subsidiary Guarantee, as the case may be, shall bind
their respective successors. All agreements of the Trustee in this Indenture
shall bind its successors.
SECTION 13.11. SEVERABILITY.
In case any provision in this Indenture, in the Senior Notes or in
the Subsidiary Guarantee shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 13.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
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SECTION 13.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
73
SIGNATURES
Dated as of April 26, 1996 FERRELLGAS PARTNERS, L.P.
By: Ferrellgas, Inc.
General Partner
By:
Name:
Title:
(SEAL)
Dated as of April 26, 1996 FERRELLGAS PARTNERS FINANCE CORP.
By:
Name:
Title:
(SEAL)
Dated as of April 26, 1996 FERRELLGAS, L.P.
By: Ferrellgas, Inc.
General Partner
By:
Name:
Title:
(SEAL)
74
Dated as of April 26, 1996 AMERICAN BANK NATIONAL ASSOCIATION
By:
Name:
Title:
Attest:
(SEAL)
75
EXHIBIT A
(Face of Senior Note)
93/8% Senior Secured Note due 2006
No. $160,000,000
FERRELLGAS PARTNERS, L.P.
FERRELLGAS PARTNERS FINANCE CORP.
promise to pay to
or registered assigns,
the principal sum of One Hundred and Sixty Million
Dollars ($160,000,000) on June 15, 2006.
Interest Payment Dates: June 15 and December 15.
Record Dates: June 1 and December 1.
Dated: April 26, 1996
FERRELLGAS PARTNERS, L.P.
[SEAL] By: Ferrellgas, Inc.
General Partner
By:
Name:
Title:
FERRELLGAS PARTNERS FINANCE
CORP.
[SEAL] By: __________________________
Name:
Title:
A-1
This is one of the Senior Notes referred to in the within-mentioned Indenture:
AMERICAN BANK NATIONAL ASSOCIATION,
as Trustee
By:__________________________________
Authorized Signatory
A-2
(Back of Note)
93/8% SENIOR SECURED NOTE
DUE 2006
[Unless and until it is exchanged in whole or in part for Senior Notes
in definitive form, this Senior Note may not be transferred except as a whole by
the Depositary to a nominee of the Depositary or by the Depositary or any such
nominee to a successor Depositary or a nominee of such successor Depositary.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York, New York) ("DTC"), to the
issuer or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
may be requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or such other entity as may be requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]1
THE SENIOR NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER
SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES
ACT"), AND THE SENIOR NOTE EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SENIOR NOTE
EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SENIOR NOTE
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUERS THAT (A) SUCH
SENIOR NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(1)(a) INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144
UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL IF THE ISSUERS SO REQUEST), (2) TO THE ISSUERS OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE,
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
FROM IT OF THE SENIOR NOTE EVIDENCED HEREBY OF THE RESALE RESTRICTIONS
SET FORTH IN (A) ABOVE.
Capitalized terms used herein have the meanings assigned to them in the
Indenture (as defined below) unless otherwise indicated.
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1 This paragraph should be included only for Senior Notes issued in global form.
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1. Interest. Ferrellgas Partners, L.P., a Delaware limited
partnership (the "Partnership"), and Ferrellgas Partners Finance Corp., a
Delaware corporation ("Finance Corp." and, together with the Partnership, the
"Issuers") promise to pay interest on the principal amount of this Senior Note
at the rate and in the manner specified below. The Issuers shall pay interest in
cash on the principal amount of this Senior Note at the rate per annum of 93/8%.
The Issuers will pay interest semi-annually in arrears on June 15 and December
15 of each year, commencing on December 15, 1996, to Holders of record on the
immediately preceding June 1 and December 1, or if any such day is not a
Business Day (as defined in the Indenture), on the next succeeding Business Day
(each an "Interest Payment Date"). Interest will be computed on the basis of a
360-day year consisting of twelve 30-day months. Interest shall accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from the date of the original issuance of the Senior Notes. To the extent
lawful, the Issuers shall pay interest on overdue principal and premium, if any,
at the rate of 1% per annum in excess of the then applicable interest rate on
the Senior Notes; it shall pay interest on overdue installments of interest and
Liquidated Damages, if any, (without regard to any applicable grace periods) at
the same rate to the extent lawful.
2. Method of Payment. The Issuers will pay interest on the
Senior Notes (except defaulted interest) to the Persons who are registered
Holders of Senior Notes at the close of business on the June 1 and December 1
immediately preceding the Interest Payment Date, even if such Senior Notes are
cancelled after such record date and on or before such Interest Payment Date.
The Holder hereof must surrender this Senior Note to a Paying Agent to collect
principal payments. The Issuers will pay principal, premium, if any, and
interest including Liquidated Damages, if any, in money of the United States
that at the time of payment is legal tender for payment of public and private
debts. The Senior Notes will be payable as to principal, premium, if any, and
interest including Liquidated Damages, if any, at the office or agency of the
Issuers maintained for such purpose within the City and State of New York or, at
the option of the Issuers, payment of interest may be made by check mailed to
the Holders of Senior Notes at their respective addresses set forth in the
register of Holders provided, however, that all payments with respect to the
Global Note and definitive Senior Notes the Holders of which have given wire
transfer instructions to the Issuers at least 10 Business Days prior to the
applicable payment date shall be made by wire transfer of immediately available
funds to the accounts specified by the Holders thereof. Unless otherwise
designated by the Issuers, the Issuers' office or agency in New York, New York
will be the office of the Trustee maintained for such a purpose.
3. Paying Agent and Registrar. Initially, the Trustee
will act as Paying Agent and Registrar. The Issuers may change any Paying
Agent, Registrar or co-registrar without notice to any Holder.
Either Issuer or the Guarantor may act in any such capacity.
4. Indenture. The Issuers issued the Senior Notes under an
Indenture dated as of April 26, 1996 (the "Indenture") among the Partnership,
Finance Corp., the Guarantor and the Trustee. The terms of the Senior Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb)
as in effect on the date of the Indenture. The Senior Notes are subject to all
such terms, and Holders of the Senior Notes are referred to the Indenture and
such act for a statement of such terms. The terms of the Indenture shall govern
any inconsistencies between the Indenture and the Senior Notes. The Senior Notes
are unsecured general obligations of the Issuers limited to $160,000,000 in
aggregate principal amount.
5. Optional Redemption. The Issuers shall not have the option
to redeem the Senior Notes pursuant to Section 3.07 of the Indenture prior to
June 15, 2001. Thereafter, the Issuers shall have the option to redeem the
Senior Notes, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of the principal
amount) set forth below, plus
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accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the 12 month period beginning on
June 15 of the years indicated below:
Year Percentage
2001.............................................. 104.6875%
2002.............................................. 103.1250%
2003.............................................. 101.5625%
2004 and thereafter............................... 100.0000%
6. Mandatory Redemption. Except as described in paragraph 7
below, the Issuers shall not be required to make mandatory redemption or sinking
fund payments with respect to the Senior Notes.
7. Redemption or Repurchase at Option of Holder. (a) If there
is a Change of Control (as defined in the Indenture), the Issuers shall be
required to offer to purchase all Senior Notes at 101% of the aggregate
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, to the date of purchase. Holders of Senior Notes that are
subject to an offer to purchase will receive a notice therefor from the Issuers
prior to any related purchase date, and may elect to have such Senior Notes
purchased by completing the form entitled "Option of Holder to Elect Purchase"
appearing below.
(b) When the aggregate amount of Excess Proceeds from Asset
Sales (as defined in the Indenture) exceeds $15 million, the Issuers shall be
required to purchase the maximum principal amount of Senior Notes that may be
purchased out of the Excess Proceeds at 100% of the principal amount thereof
plus accrued and unpaid interest and Liquidated Damages, if any, to the date
fixed for the closing of such offer. If the aggregate principal amount of Senior
Notes surrendered by Holders thereof exceeds the amount of Excess Proceeds, the
Senior Notes to be redeemed shall be selected pursuant to the terms of Section
3.02 of the Indenture (with such adjustments as may be deemed appropriate by the
Issuers so that only Senior Notes in denominations of $1,000, or integral
multiples thereof, shall be purchased). To the extent that the aggregate amount
of Senior Notes tendered by Holders thereof is less than the Excess Proceeds,
the Issuers may use such deficiency for general business purposes. Holders of
Senior Notes which are the subject of an offer to purchase will receive a notice
therefor from the Issuers prior to any related purchase date, and may elect to
have such Senior Notes purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below.
8. Notice of Redemption. Notice of redemption shall be mailed
at least 30 days but not more than 60 days before the redemption date to each
Holder of Senior Notes to be redeemed at its registered address. Senior Notes
may be redeemed in part but only in whole multiples of $1,000, unless all of the
Senior Notes held by a Holder are to be redeemed. On and after the redemption
date, interest ceases to accrue on Senior Notes or portions of them called for
redemption.
9. Denominations, Transfer, Exchange. The Senior Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Senior Notes may be registered and Senior
Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Senior Note or portion of a Senior Note selected for
redemption. Also, it need not exchange or register the transfer of any Senior
Notes for a
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period of 15 days before a selection of Senior Notes to be redeemed, during the
period between a record date and the corresponding Interest Payment Date.
10. Persons Deemed Owners. Prior to due presentment to the
Trustee for registration of the transfer of this Senior Note, the Trustee, any
Agent, the Issuers and the Guarantor may deem and treat the Person in whose name
this Senior Note is registered as its absolute owner for the purpose of
receiving payment of principal of and interest including Liquidated Damages, if
any, on this Senior Note and for all other purposes whatsoever, whether or not
this Senior Note is overdue, and neither the Trustee, any Agent, the Issuers nor
the Guarantor shall be affected by notice to the contrary. The registered holder
of a Senior Note shall be treated as its owner for all purposes.
11. Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Senior Notes or the Pledge Agreement or the Subsidiary
Guarantee may be amended with the consent of the Holders of at least a majority
in principal amount of the then outstanding Senior Notes (including consents
obtained in connection with a tender offer or exchange offer for Senior Notes),
and any existing default or compliance with any provision of the Indenture or
the Senior Notes or the Pledge Agreement or the Subsidiary Guarantee may be
waived with the consent of the Holders of a majority in principal amount of the
then outstanding Senior Notes (including consents obtained in connection with a
tender offer or exchange offer for Senior Notes). Without the consent of any
Holder, the Indenture, the Pledge Agreement, the Subsidiary Guarantee or the
Senior Notes may be amended to cure any ambiguity, defect or inconsistency, to
provide for uncertificated Senior Notes in addition to or in place of
certificated Senior Notes, to provide for assumption of the Issuers' or the
Guarantor's obligations to Holders in the case of a merger or consolidation or
to make any change that would provide any additional rights or benefits to the
Holders or that does not adversely affect the rights of any Holder under the
Indenture or to comply with the requirements of the Commission in order to
effect or maintain the qualification of the Indenture under the Trust Indenture
Act. Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any Senior Notes held by a non-consenting Holder of Senior
Notes): (i) reduce the principal amount of Senior Notes whose Holders must
consent to an amendment, supplement or waiver, (ii) reduce the principal of,
change the fixed maturity of any Senior Note or alter the provisions with
respect to the redemption of the Senior Notes (other than provisions relating to
the covenants described above under the caption "Redemption or Repurchase at the
Option of Holders"), (iii) reduce the rate of or change the time for payment of
interest and Liquidated Damages, if any, on any Senior Note, (iv) waive a
Default or Event of Default in the payment of principal of, premium, if any,
interest or Liquidated Damages, if any, on the Senior Notes (except a rescission
of acceleration of the Senior Notes by the Holders of at least a majority in
aggregate principal amount of the Senior Notes and a waiver of the payment
default that resulted from such acceleration), (v) make any Senior Note payable
in money other than that stated in the Senior Notes, (vi) make any change in the
provisions of the Indenture relating to waivers of past Defaults or the rights
of Holders of Senior Notes to receive payments of principal of, premium, if any,
interest or Liquidated Damages, if any, on the Senior Notes, (vii) waive a
redemption payment with respect to any Senior Note (other than a payment
required by one of the covenants described above under the caption "Redemption
or Repurchase at Option of Holder"), (viii) except as otherwise permitted in the
Indenture, release the Guarantor from its obligations under the Subsidiary
Guarantee or change the Subsidiary Guarantee in any manner that adversely
affects the Holders, (ix) release all or substantially all of the Pledged
Collateral from the Lien of the Indenture and the Pledge Agreement or (x) make
any change in the foregoing amendment and waiver provisions.
12. Defaults and Remedies. Events of Default include: default
for 30 days in the payment when due of interest and Liquidated Damages, if any,
on the Senior Notes; default in payment when due of principal of or premium, if
any, on the Senior Notes at maturity, upon redemption or otherwise; failure for
20 days by the Issuers to comply with Sections 4.07, 4.09, 4.10, 4.14 or 5.01 of
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the Indenture; failure by the Issuers or the Guarantor for 60 days after notice
from the Trustee or the Holder of at least 25% in principal amount of the Senior
Notes then outstanding to comply with any of their other agreements in the
Indenture or the Senior Notes; default under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Partnership or any of its
Subsidiaries (or the payment of which is guaranteed by the Partnership or any of
its Subsidiaries), whether such Indebtedness or Guarantee now exists, or is
created after the date of the Indenture, which default (a) is caused by a
failure to pay principal of or premium, if any, or interest on such Indebtedness
prior to the expiration of the grace period provided in such Indebtedness (a
"Payment Default") or (b) results in the acceleration of such Indebtedness prior
to its express maturity and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $10 million or more; failure by the Partnership or
any of its Subsidiaries to pay final judgments aggregating in excess of $10
million, which judgments are not paid, discharged or stayed for a period of 60
days; except as permitted by the Indenture, the Subsidiary Guarantee shall be
held in any judicial proceeding to be unenforceable or invalid or shall cease
for any reason to be in full force and effect or the Guarantor, or any Person
acting on behalf of the Guarantor, shall deny or disaffirm its obligations under
the Subsidiary Guarantee; breach by the Partnership of any material
representation or warranty set forth in the Pledge Agreement, or default by the
Partnership in the performance of any covenant set forth in the Pledge Agreement
after applicable grace periods, or repudiation by the Partnership of its
obligations under the Pledge Agreement or the unenforceability of any material
provision of the Pledge Agreement for any reason; and certain events of
bankruptcy or insolvency with respect to the Partnership or any of its
Subsidiaries. If any Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the then outstanding Senior
Notes may declare all the Senior Notes to be due and payable immediately; except
that in the case of an Event of Default arising from certain events of
bankruptcy or insolvency, relating to the Partnership, any Significant
Subsidiary or any group of Subsidiaries that, taken together, would constitute a
Significant Subsidiary, all outstanding Senior Notes will become due and payable
without further action or notice. Holders of the Senior Notes may not enforce
the Indenture or the Senior Notes except as provided in the Indenture. Subject
to certain limitations, Holders of a majority in principal amount of the then
outstanding Senior Notes may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Holders of the Senior Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal, interest or Liquidated Damages, if any) if
it determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Senior Notes then outstanding, by
notice to the Trustee, may on behalf of the Holders of all of the Senior Notes
waive any existing Default or Event of Default and its consequences under the
Indenture except a continuing Default or Event of Default in the payment of
principal of, premium, if any, interest and Liquidated Damages, if any, on the
Senior Notes. The Issuers are required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Issuers are required
upon becoming aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default or Event of Default.
13. Trustee Dealings with Issuers. The Trustee under the
Indenture, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Issuers, the Guarantor or their
respective Affiliates, and may otherwise deal with the Issuers, the Guarantor or
their respective Affiliates, as if it were not Trustee; however, if the Trustee
acquires any conflicting interest it must eliminate such conflict within 90
days, apply to the Commission for permission to continue as Trustee or resign.
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14. No Recourse Against Others. No past, present or future
limited partner of the Partnership or the Guarantor or director, officer,
employee, incorporator or stockholder of the General Partner or Finance Corp.,
as such, shall have any liability for any obligations of the Issuers or the
Guarantor under the Senior Notes, the Subsidiary Guarantee, the Pledge
Agreement, the Indenture or for any claim based on, in respect of, or by reason
of such obligations or their creation. Each Holder by accepting a Senior Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Senior Notes.
15. Authentication. This Senior Note shall not be valid
until authenticated by the manual signature of the Trustee or an authenticating
agent.
16. Abbreviations. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
17. Additional Rights of Holders of Transfer Restricted
Securities. In addition to the rights provided to Holders of Senior Notes under
the Indenture, Holders of Transfer Restricted Securities shall have all the
rights set forth in the Registration Rights Agreement, dated as of April 26,
1996 (the "Registration Rights Agreement"), among the Issuers, the Guarantor and
the parties named on the signature pages thereof.
18. CUSIP Numbers. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Issuers have
caused CUSIP numbers to be printed on the Senior Notes and has directed the
Trustee to use CUSIP numbers in notices of redemption as a convenience to
Holders. No representation is made as to the accuracy of such numbers either as
printed on the Senior Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.
19. Governing Law. THE INTERNAL LAW OF THE STATE OF NEW
YORK SHALL GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THE SENIOR NOTES AND
THE SUBSIDIARY GUARANTEE.
The Issuers will furnish to any Holder upon written request
and without charge a copy of the Indenture, the Registration Rights Agreement
and the Pledge Agreement. Request may be made to:
Ferrellgas Partners, L.P.
One Liberty Plaza
Liberty, Missouri 64068
Telecopier No.: (816) 792-6979
Attention: Danley K. Sheldon
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ASSIGNMENT FORM
To assign this Senior Note, fill in the form below: (I) or (we) assign
and transfer this Senior Note to
(Insert assignee's soc. sec. or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Senior Note on the books of the Issuers. The agent may
substitute another to act for him.
Date:
Your Signature:
(Sign exactly as your name appears on the face of this Senior Note)
Signature Guarantee.
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Note purchased by the
Issuers pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
Section 4.10 Section 4.14
If you want to elect to have only part of the Senior Note purchased
by the Issuers pursuant to Section 4.10 or Section 4.14 of the Indenture, state
the amount you elect to have purchased:
$-----------
Date: Your Signature:
(Sign exactly as your name appears on the Senior Note)
Tax Identification No.:
Signature Guarantee.
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SCHEDULE OF EXCHANGES OF CERTIFICATED SECURITIES2
The following exchanges of a part of this Global Note for
Certificated Securities have been made:
Amount of Amount of Principal Amount Signature of
decrease in increase in of this Global Note authorized officer
Principal Amount Principal Amount following such of Trustee or
of of decreas Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
- ---------------- ---------------- ---------------- ------------- ---------
2 To be included only for Senior Notes issued in global form.
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EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
SENIOR NOTES
Re: 93/8% Senior Secured Notes due 2006 of Ferrellgas Partners, L.P. and
Ferrellgas Partners Finance Corp. (the "Senior Notes")
This Certificate relates to $_____ principal amount of Senior Notes
held in * ________ book-entry or *_______ definitive form by ________________
(the "Transferor").
The Transferor*:
has requested the Trustee by written order to deliver in exchange for
its beneficial interest in a Global Note held by the Depositary a Senior Note or
Senior Notes in definitive, registered form of authorized denominations in an
aggregate principal amount equal to its beneficial interest in such Global Note
(or the portion thereof indicated above); or
has requested the Trustee by written order to exchange or register
the transfer of a Senior Note or Senior Notes.
In connection with such request and in respect of each such Senior
Note, the Transferor does hereby certify that Transferor is familiar with the
Indenture relating to the above captioned Senior Notes and as provided in
Section 2.06 of such Indenture, the transfer of this Senior Note does not
require registration under the Securities Act (as defined below) because:*
Such Senior Note is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.06(a)(ii)(A) or Section
2.06(d)(i)(A) of the Indenture).
Such Senior Note is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of 1933, as amended
(the "Securities Act")) in reliance on Rule 144A (in satisfaction of Section
2.06(a)(ii)(B), Section 2.06(b)(i) or Section 2.06(d)(i)(B) of the Indenture) or
pursuant to an exemption from registration in accordance with Rule 904 under the
Securities Act (in satisfaction of Section 2.06(a)(ii)(B) or Section
2.06(d)(i)(B) of the Indenture.)
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*Check applicable box.
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Such Senior Note is being transferred in accordance with Rule 144
under the Securities Act, or pursuant to an effective registration statement
under the Securities Act (in satisfaction of Section 2.06(a)(ii)(B) or Section
2.06(d)(i)(B) of the Indenture).
Such Senior Note is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the
Securities Act, other than Rule 144A, 144 or Rule 904 under the Securities Act.
An Opinion of Counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate (in
satisfaction of Section 2.06(a)(ii)(C) or Section 2.06(d)(i)(C) of the
Indenture).
[INSERT NAME OF TRANSFEROR]
By:
Date:
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*Check applicable box.
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EXHIBIT C
Subsidiary Guarantee
The Guarantor hereby unconditionally guarantees to each Holder of a
Senior Note authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
this Indenture, the Senior Notes or the obligations of the Issuers hereunder or
thereunder, that on and after the Subsidiary Guarantee Effectiveness Date: (a)
the principal of, premium, if any, and interest, including Liquidated Damages,
if any, on the Senior Notes shall be promptly paid in full when due, whether at
maturity, by acceleration, redemption or otherwise, and interest on the overdue
principal of, premium, if any, and interest, including Liquidated Damages, if
any, on the Senior Notes, if lawful, and all other obligations of the Issuers to
the Holders or the Trustee hereunder or thereunder shall be promptly paid in
full or performed, all in accordance with the terms hereof and thereof; and (b)
in case of any extension of time of payment or renewal of any Senior Notes or
any of such other obligations, that same shall be promptly paid in full when due
or performed in accordance with the terms of the extension or renewal, whether
at stated maturity, by acceleration or otherwise. Failing payment when due of
any amount so guaranteed or any performance so guaranteed for whatever reason on
and after the Subsidiary Guarantee Effectiveness Date, the Guarantor shall be
obligated to pay the same immediately.
The obligations of the Guarantor to the Holders of Senior Notes and
to the Trustee pursuant to this Subsidiary Guarantee and the Indenture are
expressly set forth in Article 12 of the Indenture, and reference is hereby made
to such Indenture for the precise terms of this Subsidiary Guarantee. The terms
of Article 12 of the Indenture are incorporated herein by reference.
The Obligations of the Guarantor under this Subsidiary Guarantee
shall be subordinated and junior in right of payment to all Senior Operating
Partnership Indebtedness as expressly set forth in Article 11 of the Indenture,
and reference is hereby made to such Indenture for the precise terms of
subordination. The terms of Article 11 of the Indenture are incorporated herein
by reference.
This is a continuing Subsidiary Guarantee and shall remain in full
force and effect and shall be binding upon the Guarantor and its respective
successors and assigns to the extent set forth in the Indenture from the
Subsidiary Guarantee Effectiveness Date until full and final payment of all of
the Issuers' Obligations under the Senior Notes and the Indenture and shall
inure to the benefit of the Trustee and the Holders of Senior Notes and their
successors and assigns and, in the event of any transfer or assignment of rights
by any Holder of Senior Notes or the Trustee, the rights and privileges herein
conferred upon that party shall automatically extend to and be vested in such
transferee or assignee, all subject to the terms and conditions hereof.
Notwithstanding the foregoing, upon satisfaction of the provisions of Section
12.04 of the Indenture, the Guarantor shall be released of its obligations
hereunder. This is a Subsidiary Guarantee of payment and not a guarantee of
collection.
This Subsidiary Guarantee shall not be valid or obligatory for any
purpose until (i) the certificate of authentication on the Senior Note upon
which this Subsidiary Guarantee is noted shall have been executed by the Trustee
under the Indenture by the manual signature of one of its authorized officers
and (ii) the Subsidiary Guarantee Effectiveness Date.
For purposes hereof, the Guarantor's liability will be that amount
from time to time equal to the aggregate liability of the Guarantor hereunder,
but shall be limited to the lesser of (i) the aggregate amount of the
obligations of the Issuers under the Senior Notes and the Indenture and (ii) the
amount, if any, which would not have (A) rendered the Guarantor "insolvent" (as
such term is defined in the federal Bankruptcy Law and in the Debtor and
Creditor Law of the State of New York) or (B) left it with
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unreasonably small capital at the time the Subsidiary Guarantee of the Senior
Notes was entered into and at the Subsidiary Guarantee Effectiveness Date, after
giving effect to the incurrence of existing Indebtedness immediately prior to
such time; provided that, it shall be a presumption in any lawsuit or other
proceeding in which the Guarantor is a party that the amount guaranteed pursuant
to the Subsidiary Guarantee is the amount set forth in clause (i) above unless
any creditor, or representative of creditors of the Guarantor, or debtor in
possession or trustee in bankruptcy of the Guarantor, otherwise proves in such a
lawsuit that the aggregate liability of the Guarantor is limited to the amount
set forth in clause (ii). The Indenture provides that, in making any
determination as to the solvency or sufficiency of capital of the Guarantor in
accordance with the previous sentence, any rights the Guarantor may have,
contractual or otherwise, shall be taken into account.
Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
FERRELLGAS, L.P.
By: Ferrellgas, Inc.
General Partner
By:
Name:
Title:
C-2
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