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TESORO PETROLEUM CORPORATION
Issuer
and
CERTAIN SUBSIDIARY GUARANTORS
9% SENIOR SUBORDINATED NOTES DUE 2008
INDENTURE
Dated as of July 2, 1998
U.S. BANK TRUST NATIONAL ASSOCIATION
Trustee
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CROSS-REFERENCE TABLE(1)
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) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.03
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.03
313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06, 7.07
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06, 12.02
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.06
314 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.03
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.04
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.05
(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
315 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.01
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.05
(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) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.12
317 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.09
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.09
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.04
318 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.01
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.01
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.01
N.A. means not applicable.
TABLE OF CONTENTS
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This Cross-Reference Table is not part of this Indenture.
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.02 Other Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 1.03 Incorporation by Reference of Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 1.04 Rules of Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE II
THE NOTES
SECTION 2.01 Form and Dating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.02 Execution and Authentication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.03 Registrar and Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 2.04 Paying Agent to Hold Money in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.05 Holder Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.06 Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 2.07 Replacement Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 2.08 Outstanding Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.09 Treasury Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.10 Temporary Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 2.11 Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.12 Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.13 CUSIP Numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE III
REDEMPTION AND PREPAYMENT
SECTION 3.01 Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 3.02 Selection of Notes to be Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 3.03 Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 3.04 Effect of Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 3.05 Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 3.06 Notes Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.07 Optional Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.08 Mandatory Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 3.09 Offer to Purchase by Application of Excess Proceeds . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 3.10 Special Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
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ARTICLE IV
COVENANTS
SECTION 4.01 Payment of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 4.02 Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 4.03 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.04 Compliance Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 4.05 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 4.06 Waiver of Stay, Extension and Usury Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 4.07 Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries . . . . . . . . . . . . . . . . . 59
SECTION 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock . . . . . . . . . . . . . . . . . . . 60
SECTION 4.10 Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 4.11 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 4.12 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.13 Business Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.14 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 4.15 Offer to Repurchase upon Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 4.16 No Senior Subordinated Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 4.17 Limitation on Issuances and Sales of Capital Stock of Subsidiaries . . . . . . . . . . . . . . . 65
SECTION 4.18 Additional Subsidiary Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 4.19 Payments for Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 4.20 Collateral for Special Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
ARTICLE V
SUCCESSORS
SECTION 5.01 Merger, Consolidation, or Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 5.02 Successor Corporation Substituted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
SECTION 6.02 Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 6.03 Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 6.04 Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 6.05 Control by Majority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 6.06 Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
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SECTION 6.07 Rights of Holders of Notes to Receive Payment . . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 6.08 Collection Suit by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 6.09 Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
SECTION 6.10 Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 6.11 Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
ARTICLE VII
TRUSTEE
SECTION 7.01 Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
SECTION 7.02 Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 7.03 Individual Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 7.04 Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 7.05 Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 7.06 Reports by Trustee to Holders of the Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 7.07 Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 7.08 Replacement of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 7.09 Successor Trustee by Merger, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 7.10 Eligibility; Disqualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 7.11 Preferential Collection of Claims Against Company . . . . . . . . . . . . . . . . . . . . . . . . 80
ARTICLE VIII
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 8.01 Satisfaction and Discharge of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 8.02 Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 8.03 Option to Effect Legal Defeasance or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . 82
SECTION 8.04 Legal Defeasance and Discharge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 8.05 Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 8.06 Conditions to Legal or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
SECTION 8.07 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 8.08 Repayment to Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
SECTION 8.09 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
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ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 Without Consent of Holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 9.02 With Consent of Holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
SECTION 9.03 Compliance with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 9.04 Revocation and Effect of Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 9.05 Notation on or Exchange of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 9.06 Trustee to Sign Amendments, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
ARTICLE X
SUBORDINATION
SECTION 10.01 Agreement to Subordinate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 10.02 Liquidation; Dissolution; Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 10.03 Default on Designated Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 10.04 Acceleration of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 10.05 Notice by Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 10.06 Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 10.07 Relative Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
SECTION 10.08 Subordination May Not Be Impaired by Company . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 10.09 Distribution or Notice to Representative . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 10.10 Rights of Trustee and Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
SECTION 10.11 Authorization to Effect Subordination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 10.12 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 10.13 Continued Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 10.14 Cumulative Rights; No Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 10.15 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
ARTICLE XI
GUARANTEES
SECTION 11.01 Subsidiary Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
SECTION 11.02 Execution and Delivery of Additional Subsidiary Guarantee or Supplemental Indenture;
Notation of Subsidiary Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
SECTION 11.03 Guarantors May Consolidate, Etc., on Certain Terms . . . . . . . . . . . . . . . . . . . . . . . 96
SECTION 11.04 Releases Following Release Under All Indebtedness or Sale of Assets . . . . . . . . . . . . . . . 98
SECTION 11.05 Limitation on Guarantor Liability; Contribution . . . . . . . . . . . . . . . . . . . . . . . . . 98
SECTION 11.06 Trustee to Include Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 11.07 Subordination of Subsidiary Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
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ARTICLE XII
MISCELLANEOUS
SECTION 12.01 Trust Indenture Act Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
SECTION 12.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
SECTION 12.03 Communication by Holders of Notes with Other Holders of Notes . . . . . . . . . . . . . . . . . . 101
SECTION 12.04 Certificate and Opinion as to Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . 101
SECTION 12.05 Statements Required in Certificate or Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . 101
SECTION 12.06 Rules by Trustee and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 12.07 No Personal Liability of Directors, Officers, Employees and Stockholders . . . . . . . . . . . . 102
SECTION 12.08 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 12.09 No Adverse Interpretation of Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 12.10 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 12.11 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
SECTION 12.12 Counterpart Originals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
SECTION 12.13 Table of Contents, Headings, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
EXHIBIT A-1 (Face of Note) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A1-1
EXHIBIT A-2 (Face of Regulation S Temporary Global Note) . . . . . . . . . . . . . . . . . . . . . . . . . A2-1
EXHIBIT B Form of Certificate of Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
EXHIBIT C Form of Certificate of Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1
EXHIBIT D Form of Certificate from Acquiring Institutional Accredited Investor . . . . . . . . . . . . . . D-1
EXHIBIT E Form of Supplemental Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1
EXHIBIT F Registration Rights Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
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INDENTURE dated as of July 2, 1998 among Tesoro Petroleum Corporation,
a Delaware corporation (the "Company"), the subsidiaries of the Company listed
on the signature pages hereof (the "Guarantors") and U. S. Bank Trust National
Association, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 9% Senior Subordinated Notes due 2008 (the"Initial Notes") and the 9%
Senior Subordinated Notes due 2008, Series B issued in exchange for any
Initial Notes in an Exchange Offer or upon transfer pursuant to a Shelf
Registration Statement (the "Exchange Notes" and, together with the Initial
Notes, the "Notes"):
ARTICLE I
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 is
merged with or into or became a Restricted Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Restricted Subsidiary of such specified Person and (ii) Indebtedness secured by
a Lien encumbering any asset acquired by such specified Person.
"Adjusted Net Assets" of a Guarantor at any date means the lesser of
the amount by which (i) the fair value of the property of such Guarantor
exceeds the total amount of liabilities, including contingent liabilities
(after giving effect to all other fixed and contingent liabilities incurred or
assumed on such date), but excluding liabilities under its Subsidiary
Guarantee, of such Guarantor at such date and (ii) the present fair salable
value of the assets of such Guarantor at such date exceeds the amount that will
be required to pay the probable liability of such Guarantor on its debts (after
giving effect to all other fixed and contingent liabilities incurred or assumed
on such date and after giving effect to any collection from any Subsidiary of
such Guarantor in respect of the obligations of such Subsidiary under such
Subsidiary Guarantee), excluding debt in respect of such Subsidiary Guarantee,
as they become absolute and matured.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that, for
purposes of Section 4.11 hereof and the use of the term "Affiliates"
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thereunder, 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 Authenticating Agent.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and CEDEL that apply to such transfer
or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, by way of a
sale and leaseback) other than in the ordinary course of business (provided
that the sale, lease, conveyance or other disposition of all or substantially
all of the assets of the Company and its Restricted Subsidiaries taken as a
whole will be governed by the covenants described in Sections 4.15 and 5.01
hereof and not by the provisions of Section 4.10 hereof), and (ii) the issue or
sale by the Company or any of its Restricted Subsidiaries of Equity Interests
of any of the Company's Restricted Subsidiaries, in the case of either clause
(i) or (ii), whether in a single transaction or a series of related
transactions,(a) that have a Fair Market Value in excess of $2,000,000 or (b)
for Net Proceeds in excess of $2,000,000; provided that the following will not
be deemed to be Asset Sales: (i) any transfer, conveyance, sale, lease or other
disposition of assets or rights securing the Senior Credit Facility or other
Senior Debt in connection with the enforcement of the Liens therein; (ii) any
sale or exchange of production of crude oil, natural gas and natural gas
liquids, or refined products or residual hydrocarbons, or any other asset or
right constituting inventory, made in the ordinary course of the Permitted
Business; (iii) any disposition of assets in trade or exchange for assets of
comparable Fair Market Value used or usable in any Permitted Business
(including, without limitation, the trade or exchange for a controlling
interest in another business or all or substantially all of the assets of a
business, in each case engaged in a Permitted Business or for other non-current
assets to be used in a Permitted Business, including, without limitation,
assets or Investments of the nature or type described in clause (m) of the
definition of "Permitted Investments"), provided that (x) except for trades or
exchanges of oil and gas properties and interests therein for other oil and gas
properties and interests therein, if the Fair Market Value of the assets so
disposed of, in a single transaction or in a series of related transactions, is
in excess of $20,000,000, the Company shall obtain an opinion or report from an
Independent Financial Advisor confirming that the assets received by the
Company and the Restricted Subsidiaries in such trade or exchange have a fair
market value of at least the fair market value of the assets so disposed and
(y) any cash or Cash Equivalent received by the Company or a Restricted
Subsidiary in connection with such trade or exchange (net of any transaction
costs of the type deducted under the definition of "Net Proceeds") shall be
treated as Net Proceeds of an Asset Sale and shall be applied in the manner set
forth in Section 4.10 hereof; (iv) a transfer of assets by the Company to a
Restricted Subsidiary of the Company or by a Restricted Subsidiary of the
Company to the Company or to a Restricted Subsidiary of the Company; (v) an
issuance or sale of Equity Interests by a Restricted Subsidiary of the Company
to the Company or to another Restricted Subsidiary of the Company; (vii) (A) a
Permitted Investment or (B) a Restricted Payment that is permitted by Section
4.07; (viii) the trade, sale or exchange of Cash Equivalents; (ix) the sale,
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exchange or other disposition of obsolete assets not integral to any Permitted
Business; (x) the abandonment or relinquishment of assets or property in the
ordinary course of business, including, without limitation, the abandonment,
relinquishment or farm-out of oil and gas leases, concessions or drilling or
exploration rights or interests therein; (xi) any lease of assets entered into
in the ordinary course of business and with respect to which the Company or any
Restricted Subsidiary of the Company is the lessor and the lessee has no option
to purchase such assets for less than fair market value at any time the right
to acquire such asset occurs; (x) the disposition of assets received in
settlement of debts accrued in the ordinary course of business; and (xi) any
Production Payment created, incurred, issued, assumed or guaranteed in
connection with the financing of, and within 30 days after the acquisition of,
the oil and gas property that is subject thereto.
"BHP Note" means that certain unsecured, non-interest bearing
promissory note dated May 29, 1998 issued by the Company in the principal
amount of $50,000,000 to BHP Hawaii Inc.
"Bankruptcy Code" means Title 11, U.S. Code, as amended, or any
similar federal or state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized on a balance sheet
in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participation, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than one year from the date of acquisition, (iii) certificates of deposit
and Eurodollar time deposits with maturities of not more than one year from the
date of acquisition, bankers' acceptances with maturities of not more than one
year from the date of acquisition and overnight bank deposits, in each case
with any domestic commercial bank having capital and surplus in excess of
$500,000,000 and a Thompson Bank Watch Rating of "B" or better, (iv) repurchase
obligations with a term of not more than seven days for underlying securities
of the types described in clauses (ii) and (iii) above entered into with any
financial institution meeting the qualifications specified in clause (iii)
above, (v) commercial paper having the highest rating obtainable from
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Moody's Investors Service, Inc. or Standard & Poor's Rating Group with
maturities of not more than one year from the date of acquisition.
"CEDEL" means Cedel Bank, societe anonyme.
"Change of Control" means the occurrence of one or more of the
following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the assets of the Company to any Person or group of related Persons for
purposes of Section 13(d) of the Exchange Act (a "Group") together with any
Affiliates thereof (whether or not otherwise in compliance with the provisions
of the Indenture), unless immediately following such sale, lease, exchange or
other transfer in compliance with the Indenture such assets are owned, directly
or indirectly, by the Company or a Wholly Owned Restricted Subsidiary of the
Company; (ii) the approval by the holders of Capital Stock of the Company of
any plan or proposal for the liquidation or dissolution of the Company; (iii)
the acquisition in one or more transactions, of beneficial ownership (within
the meaning of Rule 13d-3 under the Exchange Act) of Voting Securities of the
Company by any Person or Group that either (A) beneficially owns (within the
meaning of Rule 13d-3 under the Exchange Act), directly or indirectly, at least
50% of the Company's then outstanding voting securities entitled to vote on a
regular basis for the board of directors of the Company, or (B) otherwise has
the ability to elect, directly or indirectly, a majority of the members of the
Company's board of directors, including, without limitation, by the acquisition
of revocable proxies for the election of directors; or (iv) during any period
of two consecutive years, individuals who at the beginning of such period
constituted the board of directors of the Company (together with any new
directors whose election by such board of directors or whose nomination for
election by the shareholders (or members, as applicable) of the Company was
approved by a vote of 66 2/3% of the directors of the Company then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the board of directors then in office.
"Collateral" means (i) all rights, titles and interests of the Company
in and to the Escrow Agreement, (ii) the Collateral Account that may be
established pursuant to Section 4.20 hereof and all other cash or Cash
Equivalents deposited in the Collateral Account from time to time pursuant to
Section 4.20 hereof, (iii) all rights and privileges of the Company with
respect to the Collateral Account and such cash and Cash Equivalents, (iv) all
dividends, interest and other payments and distributions made on or with
respect to (a) the Company's rights, titles or interests in the Escrow
Agreement, (b) any such Cash Equivalents on deposit in the Collateral Account
or (c) the Collateral Account and (v) all proceeds of any of the foregoing, in
all cases limited to an aggregate amount not in excess of the Special
Redemption Amount.
"Commodity Hedging Agreements" means agreements or arrangements
designed to protect such Person against fluctuations in the price of (i) crude
oil, natural gas, or other hydrocarbons, including refined hydrocarbon products
or (ii) electricity and other sources of energy or power used in the Company's
refining, processing or exploration and production operations, in either case
in connection with the conduct of its business and not for speculative
purposes.
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"Commodity Hedging Obligations" means, with respect to any Person, the
net payment Obligations of such Person under Commodity Hedge Agreements.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus (i) an
amount equal to any extraordinary, unusual or non-recurring expenses or losses
(including, whether or not otherwise includable as a separate item in the
statement of Consolidated Net Income for such period, losses on sales of assets
outside of the ordinary course of business) plus any net loss realized in
connection with an Asset Sale (to the extent such losses were deducted in
computing such Consolidated Net Income), plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
and whether or not capitalized (including, without limitation, amortization of
debt issuance costs and original issue discount, non- cash interest payments,
the interest component of any deferred payment obligations, the interest
component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Hedging Obligations), to the extent that any such expense was deducted in
computing such Consolidated Net Income, plus (iv) 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 and its Restricted Subsidiaries for such period to the extent that such
depreciation and amortization were deducted in computing such Consolidated Net
Income, minus (v) non-cash items increasing such Consolidated Net Income for
such period, in each case, on a consolidated basis and determined in accordance
with GAAP. Notwithstanding the foregoing, the provision for taxes on the
income or profits of, and the depreciation and amortization and other non-cash
charges of, a Restricted Subsidiary of the referent Person shall be added to
Consolidated Net Income to compute Consolidated Cash Flow only to the extent
(and in same proportion) that the Net Income of such Restricted Subsidiary was
included in calculating the Consolidated Net Income of such Person and only if
a corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior
governmental approval (that has not been obtained), and without direct or
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Restricted Subsidiary or its stockholders.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries (for such period, on a consolidated basis, determined in
accordance with GAAP); provided that (i) the Net Income (but not loss) of any
Person that is not a Restricted Subsidiary or that is accounted for by the
equity method of accounting shall be included only to the extent of the amount
of dividends or distributions paid in cash to the referent Person or a
Restricted Subsidiary, (ii) the Net Income of any Restricted Subsidiary shall
be excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income is not
at the date of determination permitted without any
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prior governmental approval (that has not been obtained) or, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Restricted Subsidiary or its stockholders, (iii) the Net
Income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded, and (iv) the
cumulative effect of a change in accounting principles shall be excluded and
(v) any ceiling limitation writedowns under SEC guidelines shall be treated as
capitalized costs, as if such writedown had not occurred.
"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 Restricted 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 Stock)
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, 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 12.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Facility" means, with respect to the Company or any Restricted
Subsidiary, one or more debt facilities (including, without limitation, the
Senior Credit Facility), commercial paper facilities with banks or other
institutional lenders providing for revolving credit loans, other borrowings
(including term loans), receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow
from such lenders against such receivables) or letters of credit, in each case,
as amended, restated, modified, renewed, extended, refunded, replaced or
refinanced (in each case, without limitation as to amount) in whole or in part
from time to time.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequester or similar official under the Bankruptcy Code.
"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.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof, in the
form of Exhibit A-1 hereto except that such Note shall not bear the Global Note
Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Depositary" means, with respect to the 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 Notes, and
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any and all successors thereto appointed as depositary hereunder and having
become such pursuant to the applicable provision of this Indenture.
"Designated Senior Debt" means (i) any Indebtedness outstanding under
the Senior Credit Facility and (ii) any other Senior Debt permitted hereunder
the principal amount of which is $25,000,000 or more and that has been
designated by the Company as "Designated Senior Debt."
"Disqualified Stock" means, with respect to any Person, any Capital
Stock to the extent that by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable) or upon the happening
of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the Holder thereof, in
whole or in part, on or prior to the date that is 91 days after the date on
which the Notes mature, except to the extent that such Capital Stock is solely
redeemable with, or solely exchangeable for, any Capital Stock of such Person
that is not Disqualified Stock.
"Dollar-Denominated Production Payments" means production payment
obligations recorded as liabilities in accordance with GAAP, together with all
undertakings and obligations in connection therewith.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Escrow Agreement" means that certain Escrow Agreement dated as of
July 2, 1998 by and among Shell Refining Holding Company, the Company and U.S.
Bank Trust National Association, as escrow agent, as may be modified or amended
from time to time.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" has the meaning set forth in the preamble of this
Indenture.
"Exchange Offer" has the meaning set forth in a corresponding
Registration Rights Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in a
corresponding Registration Rights Agreement.
"Existing Indebtedness" means the BHP Note and up to an additional
$25,000,000 in aggregate amount of principal, letters of credit reimbursement
obligations or Capital Lease
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Obligations, of Indebtedness of the Company and its Restricted Subsidiaries
(other than Indebtedness under the Senior Credit Facility and the Notes) in
existence on the Issue Date.
"Fair Market Value" means, with respect to consideration received or
to be received, or given or to be given, pursuant to any transaction by the
Company or any Restricted Subsidiary, the fair market value of such
consideration as determined in good faith by the Board of Directors of the
Company.
"Financial Hedging Obligations" means, with respect to any Person, the
net payment 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 or currency exchange rates incurred or entered into in the
ordinary course of its business and not for speculative purposes.
"Fixed Charges" means, with respect to any Person for any period, the
sum, without duplication, of (i) the consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation or duplication, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all
payments associated with Capital Lease Obligations, commissions, discounts and
other fees and charges incurred in respect of letter of credit or bankers'
acceptance financings, and net payments (if any) pursuant to Hedging
Obligations), (ii) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period, (iii) any interest
expense on Indebtedness of another Person that is guaranteed by such Person or
one of its Restricted Subsidiaries or secured by a Lien on assets of such
Person or one of its Restricted Subsidiaries (whether or not such guarantee or
Lien is called upon) and (iv) the product of (a) all dividend payments, whether
or not in cash, on any series of preferred stock of such Person or any of its
Restricted Subsidiaries, other than dividend payments on Equity Interests
payable solely in Equity Interests of the Company (other than Disqualified
Stock), times (b) a fraction, the numerator of which is one and the denominator
of which is one minus the then current combined federal, state and local
statutory tax rate of such Person, expressed as a decimal, in each case, on a
consolidated basis and in accordance with GAAP; provided that interest
attributable to Dollar-Denominated Production Payments shall be excluded from
Fixed Charges.
"Fixed Charge Coverage Ratio" means with respect to any Person for any
period, the ratio of the Consolidated Cash Flow of such Person for such period
to the Fixed Charges of such Person for such period. In the event that the
Company or any of its Restricted Subsidiaries incurs, assumes, guarantees or
redeems any Indebtedness (other than revolving credit borrowings under any
Credit Facility) or issues or redeems preferred stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated but on or prior to the date on which 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 or redemption of
Indebtedness, or such issuance or redemption of preferred stock, as if the same
had occurred at the beginning of the applicable four-quarter
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reference period. In addition, for purposes of making the computation referred
to above, (i) acquisitions that have been made by the Company or any of its
Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the four-quarter reference
period or subsequent to such reference period and on or prior to the
Calculation Date shall be deemed to have occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such reference
period shall be calculated without giving effect to clause (iii) of the proviso
set forth in the definition of Consolidated Net Income, (ii) the Consolidated
Cash Flow attributable to discontinued operations, as determined in accordance
with GAAP, and operations or businesses disposed of prior to the Calculation
Date, shall be excluded, and (iii) the Fixed Charges attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded, but
only to the extent that the obligations giving rise to such Fixed Charges will
not be obligations of the referent Person or any of its Restricted Subsidiaries
following the Calculation Date.
"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, the statements and pronouncements of
the Financial Accounting Standards Board and such other statements by such
other entities as have been approved by a significant segment of the accounting
profession, which are applicable at the date of determination.
"Global Note Legend" means the legend set forth in Section 2.06(g)(ii)
hereof, which is required to be placed on all Global Notes issued under this
Indenture.
"Global Notes" means, individually and collectively, each of the Notes
(which may be either Restricted Global Notes or Unrestricted Global Notes)
issued or issuable in the global form of Exhibit A-1 (or in the case of
Regulation S Temporary Global Notes, Exhibit A-2) hereto issued in accordance
with Section 2.01, 2.06(b)(iv), 2.06(d)(iv) or 2.06(f) hereof.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantees
or obligations the full faith and credit of the United States 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 or pledging assets to secure), of
all or any part of any Indebtedness.
"Guarantors" means (i) each of Tesoro Petroleum Companies, Inc.,
Digicomp Inc., Tesoro Financial Services Holding Company, Victory Finance
Company, Tesoro Alaska Petroleum Company, Interior Fuels Company, Kenai Pipe
Line Company, Tesoro Alaska Pipeline Company, Tesoro Northstore Company, Tesoro
Refining, Marketing & Supply Company, Tesoro Vostok Company, Tesoro Exploration
and Production Company, Tesoro Gas Resources Company, Inc., Tesoro E&P Company,
L.P., Tesoro Natural Gas Company, Tesoro Pipeline Company, L.P., Tesoro
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Bolivia Petroleum Company, Tesoro Latin America Company, Tesoro Marine Services
Holding Company, Tesoro Marine Services, Inc., Tesoro Hawaii Corporation
(formerly known as BHP Petroleum Americas Refining Inc.) and Tesoro Petroleum
South Pacific Petroleum Company (formerly known as BHP Petroleum South Pacific
Inc.), (ii) each of the Company's Restricted Subsidiaries that becomes a
guarantor of the Notes pursuant to Section 4.18 hereof and (iii) each of the
Company's Restricted Subsidiaries executing a supplemental indenture in which
such Restricted Subsidiary agrees to be bound by the terms of the Indenture;
provided that any Person constituting a Guarantor as described above shall
cease to constitute a Guarantor when its respective Subsidiary Guarantee is
released in accordance with the terms thereof.
"Hedging Obligations" means, with respect to any Person, collectively,
the Commodity Hedging Obligations of such Person and the Financial Hedging
Obligations of such Person.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person, without duplication,
(i) (A) the principal of and premium, if any, with respect to indebtedness of
such Person for borrowed money or evidenced by bonds, notes, debentures or
similar instruments, (B) reimbursement obligations of such Person for letters
of credit or banker's acceptances, (C) Capital Lease Obligations of such
Person, (D) obligations of such Person for the payment of the balance deferred
and unpaid of the purchase price of any property except any such balance that
constitutes an accrued expense or trade payable or (E) Hedging Obligations, in
each case of the foregoing subclauses (A) through (E) if and to the extent any
of the foregoing obligations or 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, (ii) obligations or indebtedness of
others of the type referred to in the subclauses (A) through (E) of the
foregoing clause (i) that are secured by a Lien on any asset of such Person
(whether or not such Indebtedness is assumed by such Person), but in an amount
not to exceed the lesser of the amount of such other Person's obligation or
indebtedness or the Fair Market Value of such asset, (iii) to the extent not
otherwise included, the guarantee by such Person of any obligations or
indebtedness of others of the type referred to in the subclauses (A) through
(E) of the foregoing clause (i), whether or not such guarantee is contingent,
and whether or not such guarantee appears on the balance sheet of such Person
and (iv) with respect to any such Production Payment, any warranties or
guarantees of production or payment by such Person with respect to such
Production Payment but excluding other contractual obligations of such Person
with respect to any Production Payment. The amount of any Indebtedness
outstanding as of any date shall be (a) the accreted value thereof, in the case
of any Indebtedness that does not require current payments of interest, and (b)
the principal amount thereof in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Independent Financial Advisor" means a nationally recognized
accounting, appraisal or investment banking firm that is, in the reasonable
judgment of the Board of Directors, qualified to perform the task for which
such firm has been engaged hereunder and disinterested and independent
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with respect to the Company and its Affiliates; provided, that providing
accounting, appraisal or investment banking services to the Company or any of
its Affiliates or having an employee, officer or other representative serving
as a member of the Board of Directors of the Company or any of its Affiliates
will not disqualify any firm from being an Independent Financial Advisor.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Initial Purchasers" has the meaning set forth in the Purchase
Agreement.
"Initial Notes" has the meaning set forth in the preamble of this
Indenture.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other Obligations),
advances or capital contributions (excluding commission, travel and
entertainment, moving, and similar advances to officers and employees made in
the ordinary course of business), purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities, together
with all items that are or would be classified as investments on a balance
sheet prepared in accordance with GAAP. If the Company or any of its
Restricted Subsidiaries sells or otherwise disposes of any Equity Interests of
any direct or indirect Restricted Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
direct or indirect Restricted Subsidiary of the Company, the Company, or such
Restricted Subsidiary, as the case may be, shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the Fair Market
Value of the Equity Interests of such Restricted Subsidiary not sold or
disposed of in an amount determined as provided in the fourth paragraph of
Section 4.07 hereof.
"Issue Date" means the first date on which the Notes are issued,
authenticated and delivered under the Indenture.
"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.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of Initial Notes for use by such
Holders in connection with an Exchange Offer.
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"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 any asset 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, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions), or (b)
the disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries and (ii) any extraordinary or nonrecurring gain
(but not loss), together with any related provision for taxes on such
extraordinary or nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds or Cash Equivalents
received by the Company or any of its Restricted Subsidiaries in respect of any
Asset Sale (including, without limitation, any cash received upon the sale or
other disposition of any non-cash consideration received in any Asset Sale),
net of the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting, investment banking and brokers' fees, sales and
underwriting commission and other reasonable costs incurred in preparing such
asset for sale) and any relocation expenses incurred as a result thereof, taxes
paid or payable as a result thereof (after taking into account any available
tax credits or deductions and any tax sharing arrangements), amounts required
to be applied to the repayment of Indebtedness (other than Indebtedness under
any Credit Facility) secured by a Lien on the asset or assets that were the
subject of such Asset Sale and any reserve for adjustment (whether or not
placed in escrow) in respect of the sale price of such asset or assets
established in accordance with GAAP.
"Non-Recourse Indebtedness" means Indebtedness (i) as to which neither
the Company nor any of its Restricted Subsidiaries, (a) provides any guarantee
or credit support of any kind (including any undertaking, guarantee, indemnity,
agreement or instrument that would constitute Indebtedness) or (b) is directly
or indirectly liable (as a guarantor or otherwise), (ii) the incurrence of
which will not result in any recourse against any of the assets of the Company
or its Restricted Subsidiaries, and (iii) no default with respect to which
would permit (upon notice, lapse of time or both) any holder of any other
Indebtedness of the Company or any of its Restricted Subsidiaries to declare
pursuant to the express terms governing such Indebtedness a default on such
other Indebtedness or cause the payment thereof to be accelerated or payable
prior to its Stated Maturity.
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"Non-U.S. Person" means a person who is not a U.S. Person.
"Note Custodian" means the Trustee, as custodian for the Depositary
with respect to the Notes in global form, or any successor entity thereto.
"Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Obligations" means any principal, premium (if any), interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company or its Restricted
Subsidiaries whether or not a claim for post-filing interest is allowed in such
proceeding), penalties, fees, charges, expenses, indemnifications,
reimbursement obligations, damages (including Liquidated Damages), guarantees
(including the Subsidiary Guarantees) and other liabilities or amounts payable
under the documentation governing any Indebtedness or in respect thereof.
"Offering" means the offering of the Original Notes by the Company on
the Issue Date.
"Offering Memorandum" means the Offering Memorandum of the Company
dated June 29, 1998 with respect to the Offering.
"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.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to DTC, Euroclear or CEDEL, a Person
who has an account with DTC, Euroclear or CEDEL, respectively (and, with
respect to DTC, shall include Euroclear and CEDEL).
"Participating Broker-Dealer" has the meaning set forth in a
Registration Rights Agreement.
"Permitted Business" means, with respect to the Company and its
Restricted Subsidiaries, the businesses of (i) the acquisition, exploration,
development, operation and disposition of interests in oil, gas and other
hydrocarbon properties, (ii) the acquisition, gathering, treating, processing,
storage, transportation of production from such interests or properties, (iii)
the acquisition,
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processing, marketing, refining, distilling, storage and/or transportation of
hydrocarbons and/or royalty or other interests in crude oil or refined or
associated products related thereto, (iv) the acquisition, operation,
improvement, leasing and other use of convenience stores, retail service
stations, truck stops and other public accommodations in connection therewith,
(v) the marketing and distribution of petroleum and marine products and the
provision of logistical services to marine and offshore exploration and
production industries, (vi) any business currently engaged in by the Company or
its Restricted Subsidiaries and (vii) any activity or business that is a
reasonable extension, development or expansion of, or reasonably related to,
any of the foregoing.
"Permitted Debt" means (i) the incurrence by the Company and the
Guarantors of Indebtedness represented by the Original Notes, any Exchange
Notes and the Subsidiary Guarantees; (ii) the incurrence by the Company or any
Guarantor of Indebtedness and letters of credit pursuant to the Senior Credit
Facility (with letters of credit being deemed to have a principal amount equal
to the maximum potential liability of the Company or its Restricted
Subsidiaries for reimbursement obligations thereunder) in an aggregate
principal amount not to exceed $500,000,000 at any one time outstanding, less
the aggregate amount of all proceeds of Assets Sales that have been applied
since the Issue Date to permanently reduce the outstanding amount of such
Indebtedness pursuant to Section 4.10 hereof; (iii) the incurrence by the
Company or any of its Restricted Subsidiaries of Existing Indebtedness; (iv)
the incurrence by the Company or any of its Restricted Subsidiaries of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund,
Indebtedness that was permitted by the Indenture to be incurred; (v) the
incurrence by the Company or any of its Restricted Subsidiaries of intercompany
Indebtedness between or among the Company and any of its Restricted
Subsidiaries; provided, however, that (A) if the Company is the obligor, or any
Guarantor is the obligor and the Company is not the obligee, on such
Indebtedness, such Indebtedness is expressly subordinate to the payment in full
of all Obligations with respect to the Notes and (B) (1) any subsequent
issuance or transfer of Equity Interests that results in any such Indebtedness
being held by a Person other than the Company or a Restricted Subsidiary and
(2) any sale or other transfer of any such Indebtedness to a Person that is not
either the Company or a Restricted Subsidiary shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be; (vi) the incurrence by the Company or any of
its Restricted Subsidiaries of Indebtedness represented by Capital Lease
Obligations, mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase price or
cost of construction or improvement of property, plant or equipment used in the
Permitted Business (including, without limitation, oil and gas properties) of
the Company or a Restricted Subsidiary or incurred to extend, refinance, renew,
replace, defease or refund any such purchase price or cost of construction or
improvement, in each case in an aggregate principal amount not to exceed
$50,000,000 at any time outstanding, provided that, in each case, such
Indebtedness is incurred within 30 days of the later of the date of purchase or
the date of completion of such construction or improvement; (vii) the
incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness
incurred in the ordinary course of business under (A) documentary letters of
credit, or surety bonds or insurance contracts, which are to be repaid in full
not more than one year after the date on which such Indebtedness is originally
incurred to finance the purchase of goods by the
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Company or a Restricted Subsidiary of the Company, provided that the amount of
such Indebtedness shall not exceed $20,000,000 at any time outstanding; (B)
standby letters of credit, surety bonds or insurance contracts, issued for the
purpose of supporting (1) workers' compensation or similar liabilities of the
Company or any of its Restricted Subsidiaries, or (2) performance, payment,
deposit or surety obligations of the Company or any of its Restricted
Subsidiaries; and (C) bid, advance payment and performance bonds, and surety
bonds, or similar insurance contracts, of the Company and its Restricted
Subsidiaries, and refinancings thereof; (viii) the incurrence by the Company or
any of its Restricted Subsidiaries of Indebtedness consisting of (A) Financial
Hedging Obligations that are either (1) incurred for the purpose of fixing or
hedging interest rate risk related to Indebtedness permitted to be incurred by
the Company or its Restricted Subsidiaries pursuant to the Indenture, but only
to the extent that the stated aggregate notional amounts thereunder do not
exceed 105% of the aggregate principal amount of the Indebtedness to which such
obligations relate or (2) incurred in the ordinary course of business for the
purpose of limiting or managing currency exchange risks, and (B) Commodity
Hedging Obligations in connection with the conduct of a Permitted Business and,
in the case of each of clauses (A) and (B) hereof, not for speculative
purposes; (ix) the incurrence by the Company or any of its Restricted
Subsidiaries of in-kind obligations relating to overproduced gas balancing
positions arising in the ordinary course of business; (x) Indebtedness arising
from agreements of the Company or any of its Restricted Subsidiaries providing
for indemnification, adjustment of purchase price or similar obligations, in
each case, incurred in connection with the disposition or acquisition of any
business, assets or a Restricted Subsidiary of the Company or any of its
Restricted Subsidiaries, other than guarantees of Indebtedness incurred by any
Person acquiring all or any portion of such business, assets or a Restricted
Subsidiary of the Company or any of its Restricted Subsidiaries for the
purposes of financing such acquisition; provided, however, that (A) such
Indebtedness is not reflected on the balance sheet of the Company or any of its
Restricted Subsidiaries (contingent obligations referred to in a footnote to
financial statements and not otherwise reflected on the balance sheet will not
be deemed to be reflected on such balance sheet for purposes of this clause
(A)) and (B) the maximum liability in respect of all such Indebtedness shall at
no time exceed the gross proceeds including noncash proceeds (the Fair Market
Value of such noncash proceeds being measured at the time received and without
giving effect to any subsequent changes in value) actually received by the
Company and its Restricted Subsidiaries in connection with such disposition;
(xi) the guarantee by the Company or any of the Guarantors of Indebtedness of
the Company or a Restricted Subsidiary of the Company that was permitted to be
incurred by Section 4.09 hereof (other than pursuant to this clause (xi));
provided, that the guarantee of any Indebtedness by a Restricted Subsidiary of
the Company that ceases to be such a Restricted Subsidiary shall be deemed a
Restricted Investment at the time such Restricted Subsidiary's status
terminates in an amount equal to the maximum principal amount so guaranteed,
for so long as, and to the extent that, such guarantee remains outstanding;
(xii) the issuance by a Restricted Subsidiary of the Company of preferred stock
to the Company or to any of its Wholly Owned Restricted Subsidiaries; provided,
however, that any subsequent event or issuance or transfer of any Equity
Interests that results in the owner of such preferred stock ceasing to be the
Company or any of its Wholly Owned Restricted Subsidiaries or any subsequent
transfer of such preferred stock to a Person, other than the Company or one of
its Restricted Subsidiaries, shall be deemed to be an issuance of preferred
stock by such Subsidiary that was not permitted by this clause (xii); and
(xiii)
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the incurrence by the Company or any of its Restricted Subsidiaries of
Indebtedness (in addition to Indebtedness permitted by any other clause of this
paragraph) in an aggregate principal amount (or accreted value, as applicable)
at any time outstanding not to exceed $50,000,000.
"Permitted Investments" means (a) any Investment in the Company or in
a Restricted Subsidiary of the Company; (b) any Investment in Cash Equivalents
or deposit accounts maintained in the ordinary course of business consistent
with past practices; (c) any Investment by the Company or any Restricted
Subsidiary of the Company in a Person, if as a result of such Investment (i)
such Person becomes a Restricted Subsidiary of the Company or (ii) 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 Company or a
Restricted Subsidiary of the Company; (d) any security or other Investment
received or Investment made as a result of the receipt of non-cash
consideration from (i) an Asset Sale that was made pursuant to and in
compliance with the covenant described in Section 4.10 hereof or (ii) a
disposition of assets that do not constitute an Asset Sale; (e) any acquisition
of assets solely in exchange for the issuance of Equity Interests (other than
Disqualified Stock) of the Company; (f) any Investment received in settlement
of debts, claims or disputes owed to the Company or any Restricted Subsidiary
of the Company that arose out of transactions in the ordinary course of
business; (g) any Investment received in connection with or as a result of a
bankruptcy, workout or reorganization of any Person; (h) advances and
extensions of credit in the nature of accounts receivable arising from the sale
or lease of goods or services or the licensing of property in the ordinary
course of business; (i) relocation allowances for, and advances and loans to,
employees, officers and directors, approved by the Board of Directors (or
authorized officer) (including, without limitation, loans and advances the net
cash proceeds of which are used solely to purchase Equity Interests of the
Company in connection with restricted stock or employee stock purchase plans,
or to exercise stock received pursuant thereto or other incentive plans in a
principal amount not to exceed the aggregate exercise or purchase price), or
loans to refinance principal and accrued interest on any such loans, provided
that the aggregate principal amount of such loans, advances and allowances
shall not exceed at any time $10,000,000; (j) other Investments by the Company
or any Restricted Subsidiary of the Company in any Person having an aggregate
Fair Market Value (measured as of the date each such Investment is made and
without giving effect to subsequent changes in value), when taken together with
all other Investments made pursuant to this clause (j) (net of returns of
capital, dividends and interest paid on Investments and sales, liquidations and
redemptions of Investments), not in excess of the greater of $50,000,000 and
15% of the Consolidated Net Worth of the Company; (k) Investments in the form
of intercompany Indebtedness or Guarantees of Indebtedness of a Restricted
Subsidiary of the Company permitted under clauses (v) and (xii) of the
definition of "Permitted Debt"; (l) Investments arising in connection with
Hedging Obligations that are incurred in the ordinary course of business for
the purpose of fixing or hedging currency, commodity or interest rate risk in
connection with the conduct of the business of the Company and its Subsidiaries
and not for speculative purposes; (m) Investments in the form of, or pursuant
to, operating agreements, joint ventures, partnership agreements, working
interests, royalty interests, mineral leases, processing agreements, farm-out
agreements, contracts for the sale, transportation or exchange of oil and
natural gas, unitization agreements, pooling agreements, area of mutual
interests agreements, production sharing agreements or other similar or
customary
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agreements, transactions, properties, interests or arrangements, and
Investments and expenditures in connection therewith or pursuant thereto, in
each case made or entered into in the ordinary course of the business described
in clauses (i) and (ii) of the definition of "Permitted Business" excluding,
however, investments in corporations; and (n) Investments pursuant to
agreements and obligations of the Company and any Restricted Subsidiary in
effect on the Issue Date.
"Permitted Junior Securities" means (i) Equity Interests in the
Company or any Guarantor which, to the extent received by any Holder in
connection with any bankruptcy, reorganization, insolvency or similar
proceeding in which any Equity Interests are also exchanged for or distributed
in respect of Senior Debt, are either common equity securities or are
subordinated to all such Equity Interests so exchanged or distributed to
substantially the same extent as, or to a greater extent than, the Notes are
subordinated to Senior Debt pursuant to the Indenture, and (ii) debt securities
that are subordinated to all Senior Debt (and any debt securities issued in
exchange for Senior Debt) to substantially the same extent as, or to a greater
extent than, the Notes are subordinated to Senior Debt pursuant to the
Indenture.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness), including Indebtedness that extends,
refinances, renews, replaces, defeases or refunds Permitted Refinancing
Indebtedness; provided that: (i) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not exceed the
principal amount of (or accreted value, if applicable), plus accrued and unpaid
interest on, the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus fees and expenses incurred in connection therewith,
including any premium or defeasance cost); (ii) such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and 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; (iii) if the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded is
subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and is subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders of Notes as those contained in the documentation
governing the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (iv) such Indebtedness is incurred either by the
Company or a Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint stock company, trust, limited liability company,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
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"preferred stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the
holders of the other Capital Stock issued by such Person.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) hereof to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.
"Production Payment" means, collectively, Dollar-Denominated
Production Payments and Volumetric Production Payments.
"Public Equity Offering" means any public underwritten offering by the
Company of Voting Stock (other than Disqualified Stock) of the Company pursuant
to registration under the Securities Act of 1933, as amended, made pursuant to
an underwriting or similar agreement executed and delivered after the Issue
Date.
"Purchase Agreement" means the Purchase Agreement dated June 29, 1998
among the Company and the Initial Purchasers (as defined therein) relating to
the Offering.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registration Rights Agreement" means (i) the Registration Rights
Agreement, dated as of the Issue Date, by and among the Company and the other
parties named on the signature pages thereof relating to the Original Notes,
attached hereto as Exhibit F, and (ii) any similar agreement that the Company
and other parties may enter into in relation to any other Initial Notes, in
each case as such agreement may be amended, modified or supplemented from time
to time.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global Note in
the form of Exhibit A-1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note in
the form of Exhibit A-2 hereto bearing the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
of the Notes initially sold in reliance on Rule 903 of Regulation S.
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"Representative" means the administrative agent under the Senior
Credit Facility or its successor thereunder or any other agent or
representative on behalf of the holders of Designated Senior Debt.
"Responsible Officer," when used with respect to the Trustee, means
any officer, including, without limitation, any vice president, assistant vice
president, assistant treasurer or secretary 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 particular corporate trust matter, any other officer or employee to whom
such matter is referred because of his knowledge of and familiarity with the
particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
set forth in Regulation S, which period shall be terminated with respect to any
Regulation S Temporary Global Note as provided in Section 2.01.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referenced Person that is not an Unrestricted Subsidiary or a direct or
indirect Subsidiary of an Unrestricted Subsidiary; provided that, on the Issue
Date, all Subsidiaries of the Company shall be Restricted Subsidiaries of the
Company.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 144A Global Note" means the Global Note in the form of Exhibit
A-1 hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
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"Senior Credit Facility" means that certain Third Amended and Restated
Credit Agreement, dated as of the Issue Date, by and among the Company, Lehman
Brothers Inc., as Arranger, Lehman Commercial Paper Inc., as Syndication Agent,
and certain other lenders and agents, providing for up to $200,000,000 of term
loan borrowings and $300,000,000 of revolving credit borrowings and letters of
credit in each case, including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith and in
each case as amended, modified, renewed, restated, refunded, replaced or
refinanced (in each case, without limitation as to amount), in whole or in
part, from time to time and any agreements (and related documents) governing
Indebtedness incurred to refund or refinance credit extensions and commitments
then outstanding or permitted to be outstanding under such Senior Credit
Facility, whether by the same or any other lender or group of lenders. The
Company shall promptly notify the Trustee of any other lender or group of
lenders. The Company shall promptly notify the Trustee of any such refunding
or refinancing of the existing Senior Credit Facility.
"Senior Debt" means (i) Indebtedness of the Company or any Guarantor
for money borrowed and all obligations of such Person under, or with respect
to, the Senior Credit Facility or any other Credit Facility, whether direct or
indirect, under guarantees, letters of credit, foreign currency or interest
rate swaps, foreign exchange contracts, caps, collars, options, hedges or other
agreements or arrangements designed to protect against fluctuations in currency
values or interest rates, other extensions of credit, expenses, fees,
reimbursements, indemnities and all other amounts (including interest at the
contract rate accruing on or after the filing of any petition in bankruptcy or
reorganization relating to the Company or any Guarantor whether or not a claim
for post-filing interest is allowed in such proceeding), (ii) the principal of
and premium, if any, and accrued and unpaid interest, whether existing on the
date hereof or hereafter incurred, in respect of (A) indebtedness of the
Company or any Guarantor for money borrowed, (B) guarantees by the Company or
any Guarantor of indebtedness for money borrowed by any other Person, (C)
indebtedness evidenced by notes, debentures, bonds, or other instruments for
the payment of which the Company or any Guarantor is responsible or liable, by
guarantees or otherwise, (D) obligations of the Company or any Guarantor for
the reimbursement of any obligor on any letter of credit, banker's acceptance
or similar credit transaction, (E) obligations of the Company or any Guarantor
under any agreement to lease, or any lease of, any real or personal property
which, in accordance with GAAP, is classified on the Company's or any
Guarantor's consolidated balance sheet as a liability, and (F) obligations of
the Company or any Guarantor under interest rate swaps, caps, collars, options
and similar arrangements and commodity or foreign currency hedges and (iii)
modifications, renewals, extensions, replacements, refinancings and refundings
of any such indebtedness, obligations or guarantees, unless, in the instrument
creating or evidencing the same or pursuant to which the same is outstanding,
it is expressly provided that such indebtedness, obligations or guarantees, or
such modifications, renewals, extensions, replacements, refinancings or
refundings thereof, are not superior in right of payment to the Notes; provided
that Senior Debt will not be deemed to include (a) Indebtedness represented by
preferred stock, (b) any obligation of the Company or any Guarantor to any
Subsidiary or other Affiliate, (c) any liability for federal, state, local or
other taxes owed or owing by the Company or any Guarantor, (d) any accounts
payable or other liability to trade creditors, (e) any Indebtedness, guarantee
or obligation of the Company or any Guarantor which is
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expressly subordinate or junior by its terms in right of payment to any other
Indebtedness, guarantee or obligation of the Company or any Guarantor, (f) that
portion of any Indebtedness incurred in violation of Section 4.09 hereof (other
than Indebtedness incurred under a Credit Facility if prior to the incurrence
thereof or, in the case of contingent obligations such as letters of credit
pursuant to which such Indebtedness is incurred, prior to the issuance thereof
or agreement to extend credit in respect thereof, the Company has certified to
the lenders under such Credit Facility that such incurrence or extension of
credit does not violate such covenant) or (g) Indebtedness of the Company or
any Guarantor which is classified as non-recourse in accordance with GAAP or
any unsecured claim arising in respect thereof by reason of the application of
Section 1111(b) (1) of the Bankruptcy Code.
"Shelf Registration Statement" has the meaning set forth in a
corresponding Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary 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 Issue Date.
"Stated Maturity" means, with respect to any installment of interest
or principal, or sinking fund or mandatory redemption of principal, on any
series of Indebtedness, the date on which such payment of interest or principal
was scheduled to be paid or made, as applicable, in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or an entity described in clause (i)
and related to such Person or (b) the only general partners of which are such
Person or of one or more entities described in clause (i) and related to such
Person (or any combination thereof).
"Subsidiary Guarantee" means the guarantee of the Notes (including any
Exchange Notes) by each of the Guarantors pursuant to Article XI hereof and in
the related form of guarantee notation endorsed on the form of Note attached
hereto as Exhibit A-1 or A-2 and any additional guarantee of the Notes
(including any Exchange Notes) to be executed by any Restricted Subsidiary of
the Company pursuant to Section 4.18.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
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"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.
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent Global Note in the form
of Exhibit A-1 attached hereto that bears the Global Note Legend and that has
the "Schedule of Exchanges of Interests in the Global Note" attached thereto,
and that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
(including any newly acquired or newly formed Subsidiary of the Company) that
is designated by the Board of Directors as an Unrestricted Subsidiary pursuant
to a resolution of the Board of Directors as certified in an Officers'
Certificate delivered to the Trustee and (ii) each Subsidiary of an
Unrestricted Subsidiary, whenever it shall become such a Subsidiary. The Board
of Directors may designate any Subsidiary of the Company to become an
Unrestricted Subsidiary if it (a) has no Indebtedness other than Non-Recourse
Indebtedness; (b) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained, in light of all the circumstances, at the time from
Persons who are not Affiliates of the Company; (c) is a Person with respect to
which neither the Company nor any of its Restricted Subsidiaries has any direct
or indirect obligation (x) to subscribe for additional Equity Interests or (y)
to maintain or preserve such Person's financial condition or to cause such
Persons to achieve any specified levels of operating results; (d) has not
guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of the Company or any of its Restricted Subsidiaries; and (e) does
not own any Capital Stock of or own or hold any Lien on any property of, the
Company or any Restricted Subsidiary of the Company; and (f) would constitute
an Investment which the Company could make in compliance with Section 4.07.
Notwithstanding the foregoing, if, at any time, any Unrestricted Subsidiary
would fail to meet the foregoing requirements as an Unrestricted Subsidiary, it
shall thereafter cease to be an Unrestricted Subsidiary for purposes of the
Indenture and any Indebtedness of such Subsidiary shall be deemed to be
incurred as of such date.
"U.S." means the United States of America.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"Volumetric Production Payments" means production payment obligations
recorded as deferred revenue in accordance with GAAP, together with all
undertakings and obligations in connection therewith.
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"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board
of Directors of such Person.
"Washington Acquisition" means the purchase by the Company of all of
the outstanding capital stock of Shell Anacortes Refining Company, an
affiliate of Shell Oil Company, which is being made in connection with the
Offering.
"Washington Agreement" means the Stock Purchase Agreement, dated as of
May 1, 1998, by and among the Company, as buyer, Shell Refining Holding
Company, as seller, and Shell Anacortes Refining Company entered into for the
purpose of effecting the Washington Acquisition, as such agreement may be
modified or amended from time to time.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment, by (ii) the then outstanding
principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of a Person means a Restricted
Subsidiary of such Person to the extent (i) all of the outstanding Capital
Stock and other Equity Interests of which (other than director's qualifying
shares) shall be directly or indirectly owned by such Person or (ii) such
Restricted Subsidiary is organized in a foreign jurisdiction and is required by
the applicable laws and regulations of such jurisdiction to be partially owned
by the government of such foreign jurisdiction or individual or corporate
citizens of such foreign jurisdiction or another foreign jurisdiction in order
for such Restricted Subsidiary to transact business in such foreign
jurisdiction, provided that such Person, directly or indirectly, owns the
remaining Capital Stock or ownership interests in such Restricted Subsidiary
and, by contract or otherwise, derives the economic benefits of ownership of
such Restricted Subsidiary to substantially the same extent as if such
Restricted Subsidiary were a wholly owned Restricted Subsidiary.
SECTION 1.02 Other Definitions.
DEFINED IN
TERM SECTION
---- ----------
"Affiliate Transaction" .................................. 4.11
"Asset Sale Offer" ....................................... 3.09
"Change of Control Offer" ................................ 4.15
"Change of Control Payment" .............................. 4.15
"Change of Control Payment Date" ......................... 4.15
"Collateral Account" ..................................... 4.20(c)
"Collateral Funds"" ...................................... 4.20(d)
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DEFINED IN
TERM SECTION
---- ----------
"Covenant Defeasance" ..................................................... 8.03
"DTC" ..................................................................... 2.03
"Event of Default" ........................................................ 6.01
"Excess Proceeds" ......................................................... 4.10
"Funding Guarantor" ....................................................... 11.05
"incur" ................................................................... 4.09
"Legal Defeasance" ........................................................ 8.02
"Nonpayment Default" ...................................................... 10.03
"Offer Amount" ............................................................ 3.09
"Offer Period" ............................................................ 3.09
"Original Notes" .......................................................... 2.02
"Paying Agent" ............................................................ 2.03
"Payment Blockage Default ................................................. 10.03
"Payment Default" ......................................................... 6.01
"Permitted Debt" .......................................................... 4.09
"Purchase Date" ........................................................... 3.09
"Registrar" ............................................................... 2.03
"Restricted Payments" ..................................................... 4.07
"Special Redemption" ...................................................... 3.01
"Special Redemption Amount" ............................................... 4.20(a)
"Special Redemption Date" ................................................. 3.10
"Special Redemption Price" ................................................ 3.10
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.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor upon
the Notes.
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All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule 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, and "including" means "including
without limitation," "including but not limited to" or words of similar import;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of successor sections or
rules adopted by the SEC from time to time.
ARTICLE II
THE NOTES
SECTION 2.01 Form and Dating.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A-1 (or in the case of a Regulation S
Temporary Global Note, Exhibit A-2) hereto. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. Each
Note shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof. Subject to Section
4.18 and 11.02 hereof, the Notes may bear notations of Subsidiary Guarantees.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture, and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note or any notation of Subsidiary Guarantees thereon
conflicts with the express provisions of this Indenture, the provisions of this
Indenture shall govern and be controlling.
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Notes issued in global form shall be substantially in the form of
Exhibit A-1 or A-2 attached hereto (including the Global Note Legend and the
"Schedule of Exchanges in the Global Note" attached thereto). Notes issued in
definitive form shall be substantially in the form of Exhibit A-1 attached
hereto (but without the Global Note Legend and without the "Schedule of
Exchanges of Interests in the Global Note" attached thereto). Each Global Note
shall represent such of the outstanding Notes as shall be specified therein and
each shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Any endorsement of a Global Note to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee, the Depositary 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.
Notes offered and sold in reliance on Regulation S shall be issued
initially in the form of the Regulation S Temporary Global Note, which shall be
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, as Note Custodian for the Depositary, and registered in the name of
the nominee of the Depositary for credit to the accounts of designated agents
holding on behalf of Euroclear or CEDEL, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The Restricted Period
shall be terminated upon the receipt by the Trustee of (i) a written
certificate from the Depositary, together with copies of certificates from
Euroclear and CEDEL certifying that they have received certification of
non-United States beneficial ownership of 100% of the aggregate principal
amount of the Regulation S Temporary Global Note (except to the extent of any
beneficial owners thereof who acquired an interest therein during the
Restricted Period pursuant to another exemption from registration under the
Securities Act and who will take delivery of a beneficial ownership interest in
a Rule 144A Global Note or a Restricted Definitive Note bearing a Private
Placement Legend, to the extent permitted by Section 2.06(b) hereof) or an
Opinion of Counsel to the effect that no such certification is required under
Regulation S, and (ii) an Officers' Certificate from the Company certifying to
the effect that the 40-day distribution compliance period applicable to the
Regulation S Temporary Global Note has expired. Following the termination of
the Restricted Period, beneficial interests in the Regulation S Temporary
Global Note shall be exchanged for beneficial interests in one or more
Regulation S Permanent Global Notes pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee shall cancel the Regulation S Temporary Global Note. The aggregate
principal amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.
The provisions of the "Operating Procedures of the Euroclear System" and
"Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of CEDEL shall be applicable
to transfers of beneficial interests in the
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Regulation S Temporary Global Note and the Regulation S Permanent Global Notes
that are held by members of, or Participants, in DTC through Euroclear or
CEDEL.
SECTION 2.02 Execution and Authentication.
One Officer shall sign the Notes for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall authenticate (i) the Initial Notes for original
issue on the Issue Date in the aggregate principal amount of $300,000,000 (the
"Original Notes"), (ii) additional Initial Notes for original issue from time
to time after the Issue Date in such principal amounts as may be set forth in a
written order of the Company described in this sentence and not to exceed the
aggregate principal amount of $50,000,000 and (iii) any Exchange Notes from
time to time for issue only in exchange for a like principal amount of Initial
Notes, in each case, upon a written order of the Company signed by one Officer,
which written order shall specify (a) the amount of Notes to be authenticated
and the date of original issue thereof, (b) whether the Notes are Initial Notes
or Exchange Notes and (c) the amount of Notes to be issued in global form or
definitive form. The aggregate principal amount of Notes outstanding at any
time may not exceed $300,000,000 plus such additional principal amounts as may
be issued and authenticated pursuant to clause (ii) of this paragraph, except
as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
SECTION 2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency within the City and
State of New York where Notes may be presented for registration of transfer or
for exchange ("Registrar") and an office or agency where Notes may be presented
for payment ("Paying Agent"). The Registrar shall keep a register of the Notes
and of their transfer and exchange. The Company may appoint one or more
co-registrars and one or more additional paying agents. The term "Registrar"
includes any co-registrar and the term "Paying Agent" includes any additional
paying agent. The Company may change any Paying Agent or Registrar without
notice to any Holder. The Company shall promptly notify the Trustee in writing
of the name and address of any Agent not a party to this Indenture. If
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the Company fails to appoint or maintain another entity as Registrar or Paying
Agent, the Trustee shall act as such. The Company or any of its Subsidiaries
may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes. The Trustee has been
appointed by DTC to act as Note Custodian with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent.
SECTION 2.04 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal of, or premium or Liquidated Damages, if any, or interest on, the
Notes, and will notify the Trustee of any default by the Company in making any
such payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or an
Affiliate of the Company (including any Subsidiary) acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
SECTION 2.05 Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company shall provide to a Responsible Officer of the
Trustee at least seven Business Days before each interest payment date and at
such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and addresses
of the Holders of Notes and the Company shall otherwise comply with TIA Section
312(a).
SECTION 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary for the Global Notes or that it is no
longer a clearing agency registered under the Exchange Act and, in
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either case, a successor Depositary is not appointed by the Company within 90
days after the date of such notice from the Depositary or (ii) the Company in
its sole discretion notifies the Trustee in writing that it elects to cause
issuance of the Notes in certificated form; provided that in no event shall the
Regulation S Temporary Global Note be exchanged by the Company for Definitive
Notes prior to (x) the expiration of the Restricted Period and (y) the receipt
by the Registrar of any certificates required pursuant to Rule 903 under the
Securities Act or an Opinion of Counsel to the effect that such certificates
are not required pursuant to Rule 903. Upon the occurrence of either of the
preceding events in (i) or (ii) above, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.11 hereof. Every Note authenticated and delivered in exchange for, or in
lieu of, a Global Note or any portion thereof, pursuant to Section 2.07 or 2.11
hereof, shall be authenticated and delivered in the form of, and shall be, a
Global Note. A Global Note may not be exchanged for another Note other than as
provided in this Section 2.06(a), however, beneficial interests in a Global
Note may be transferred and exchanged as provided in Section 2.06(b), (c) or
(f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as
one or more of the other following subparagraphs as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend;
provided, however, that prior to the expiration of the Restricted
Period transfers of beneficial interests in the Regulation S Temporary
Global Note may not be made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser). Beneficial
interests in any Unrestricted Global Note may be transferred only to
Persons who take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note. No written orders or instructions shall
be required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests (other than a transfer of a beneficial interest in
a Global Note to a Person who takes delivery thereof in the form of a
beneficial interest in the same Global Note), the transferor of such
beneficial interest must deliver to the Registrar (A) (1) a written
order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing
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the Depositary to credit or cause to be credited a beneficial interest
in another Global Note in an amount equal to the beneficial interest
to be transferred or exchanged and (2) instructions given in
accordance with the Applicable Procedures containing information
regarding the Participant account to be credited with such increase or
(B) (1) a written order from a Participant or an Indirect Participant
given to the Depositary in accordance with the Applicable Procedures
directing the Depositary to cause to be issued a Definitive Note in an
amount equal to the beneficial interest to be transferred or exchanged
and (2) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or exchange
referred to in (1) above; provided that in no event shall Definitive
Notes be issued upon the transfer or exchange of beneficial interests
in the Regulation S Temporary Global Note prior to (x) the expiration
of the Restricted Period and (y) the receipt by the Registrar of any
certificates required pursuant to Rule 903 under the Securities Act.
Upon an Exchange Offer by the Company in accordance with Section
2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall be
deemed to have been satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal delivered by the
Holder of such beneficial interests in the Restricted Global Notes.
Upon notification from the Registrar that all of the requirements for
transfer or exchange of beneficial interests in Global Notes contained
in this Indenture, the Notes and otherwise applicable under the
Securities Act have been satisfied, the Trustee shall adjust the
principal amount of the relevant Global Notes pursuant to Section
2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of clause (ii) above and the Registrar
receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the Rule 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in Item (1) thereof; or
(B) if the transferee will take delivery in the form of
the Regulation S Temporary Global Note or the Regulation S
Permanent Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in Item (2) thereof.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in the Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be
exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
clause (ii) above and:
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(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with the corresponding Registration
Rights Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the
case of a transfer, is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with the corresponding
Registration Rights Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to an Exchange Offer Registration Statement
in accordance with the corresponding Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in
a Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global Note,
a certificate from such holder in the form of Exhibit C hereto,
including the certifications in Item (1)(a) thereof;
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in Item (4) thereof; and
(3) in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form reasonably acceptable to the
Trustee and the Company to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain compliance
with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of beneficial interests transferred pursuant to subparagraph
(B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
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(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive Note, then, upon
receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in Item (2)(a) thereof;
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in Item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904 under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in Item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in Item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor or in reliance on any other
exemption from the registration requirements of the Securities
Act, in either case other than those listed in subparagraphs (B)
through (D) above, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the certifications,
certificates and any Opinion of Counsel required by Item (3)
thereof, if applicable;
(F) if such beneficial interest is being transferred to
the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in Item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in Item (3)(c) thereof,
the Trustee, upon notice of receipt of such documentation by the Registrar,
shall cause the aggregate principal amount of the applicable Global Note to be
reduced accordingly pursuant to Section
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2.06(h) hereof, and the Company shall execute and the Trustee shall authenticate
and make available for delivery to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. The Trustee shall make available
for delivery such Definitive Notes to the Persons in whose names such Notes are
so registered. Any Definitive Note issued in exchange for a beneficial interest
in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the
Private Placement Legend and shall be subject to all restrictions on transfer
contained therein.
(ii) Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof,
a beneficial interest in the Regulation S Temporary Global Note may not
be (A) exchanged for a Definitive Note prior to (x) the expiration of the
Restricted Period and (y) the receipt by the Registrar of any
certificates required pursuant to Rule 903(c)(3)(B) under the Securities
Act or (B) transferred to a Person who takes delivery thereof in the form
of a Definitive Note prior to the conditions set forth in clause (A)
above or unless the transfer is pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 903 or
Rule 904.
(iii) Notwithstanding 2.06(c)(i) hereof, a holder of a
beneficial interest in a Restricted Global Note may exchange such
beneficial interest for an Unrestricted Definitive Note or may transfer
such beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to
an Exchange Offer in accordance with the corresponding
Registration Rights Agreement and the holder of such beneficial
interest, in the case of an exchange, or the transferee, in the
case of a transfer, is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with the corresponding
Registration Rights Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to an Exchange Offer Registration Statement
in accordance with the corresponding Registration Rights
Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that
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does not bear the Private Placement Legend, a certificate from such
holder in the form of Exhibit C hereto, including the certifications in
Item (1)(b) thereof;
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial interest to
a Person who shall take delivery thereof in the form of a Definitive
Note that does not bear the Private Placement Legend, a certificate
from such holder in the form of Exhibit B hereto, including the
certifications in Item (4) thereof; and
(3) in each such case set forth in this
subparagraph (D), an Opinion of Counsel in form reasonably acceptable
to the Trustee and the Company, to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement
Legend are not required in order to maintain compliance with the
Securities Act.
(iv) If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive Note, then, upon notice
by the Registrar of satisfaction of the conditions set forth in Section
2.06(b)(ii) hereof, the Trustee shall cause the aggregate principal amount
of the applicable Global Note to be reduced accordingly pursuant to Section
2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and make available for delivery to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant to
this Section 2.06(c)(iv) shall be registered in such name or names and in
such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions from
the Depositary and the Participant or Indirect Participant. The Trustee
shall make available for delivery such Definitive Notes to the Persons in
whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iv)
shall not bear the Private Placement Legend. A beneficial interest in an
Unrestricted Global Note cannot be exchanged for a Definitive Note bearing
the Private Placement Legend or transferred to a Person who takes delivery
thereof in the form of a Definitive Note bearing the Private Placement
Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(i) If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in a Restricted Global Note, then, upon
receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate
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from such Holder in the form of Exhibit C hereto, including the
certifications in Item (2)(b) thereof;
(B) if such Definitive Note is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in Item (1) thereof;
(C) if such Definitive Note is being transferred to a Non-U.S.
Person in an offshore transaction in accordance with Rule 903 or Rule
904 under the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in Item (2) thereof;
(D) if such Definitive Note is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications
in Item (3)(a) thereof;
(E) if such Definitive Note is being transferred to an
Institutional Accredited Investor or in reliance on any other exemption
from the registration requirements of the Securities Act, in either
case, other than those listed in subparagraphs (B) through (D) above, a
certificate in the form of Exhibit B hereto, including certifications,
certificates, and any Opinion of Counsel required by Item (3) thereof,
if applicable;
(F) if such Definitive Note is being transferred to the Company
or any of its Subsidiaries, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in Item (3)(b) thereof;
or
(G) if such Definitive Note is being transferred pursuant to an
effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in Item (3)(c) thereof,
the Trustee, upon notice of receipt of such documentation by the Registrar,
shall cancel the Definitive Note, increase or cause to be increased the
aggregate principal amount of, in the case of subparagraph (A) above, the
appropriate Restricted Global Note and, in the case of subparagraph (B) above,
the Rule 144A Global Note, and, in the case of subparagraph (C) above, the
Regulation S Global Note.
(ii) A Holder of a Restricted Definitive Note may exchange such Note
for a beneficial interest in an Unrestricted Global Note or transfer such
Restricted Definitive Note to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note only if:
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43
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with the corresponding Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, is not (1) a broker-dealer, (2)
a Person participating in the distribution of the Exchange Notes or (3)
a Person who is an affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with the corresponding
Registration Rights Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to an Exchange Offer Registration Statement in
accordance with the corresponding Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in Item (1)(c) thereof;
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof in the
form of a beneficial interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B hereto, including
the certifications in Item (4) thereof; and
(3) in each such case set forth in this subparagraph (D),
an Opinion of Counsel in form reasonably acceptable to the Trustee and
the Company to the effect that such exchange or transfer is in
compliance with the Securities Act, that the restrictions on transfer
contained herein and in the Private Placement Legend are not required
in order to maintain compliance with the Securities Act, and such
Definitive Notes are being exchanged or transferred in compliance with
any applicable blue sky securities laws of any State of the United
States.
Upon satisfaction of the conditions of any of the subparagraphs in this Section
2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase or
cause to be increased the aggregate principal amount of the Unrestricted Global
Note.
(iii) A Holder of an Unrestricted Definitive Note may exchange such
Note for a beneficial interest in an Unrestricted Global Note or transfer
such Definitive Notes to a Person who takes delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note at any time. Upon
receipt of a request for such an exchange or transfer, the Trustee shall
cancel the applicable Unrestricted Definitive Note and increase or cause
to be increased the aggregate principal amount of one of the Unrestricted
Global Notes.
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(iv) If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D)
or (iii) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an authentication
order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of beneficial interests
transferred pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) above.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes 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. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, pursuant to the provisions of this Section 2.06(e).
(i) Restricted Definitive Notes may be transferred to and
registered in the name of Persons who take delivery thereof if the
Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in Item (1)
thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904 of the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in Item (2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications, certificates and Opinion of
Counsel required by Item (3) thereof, if applicable.
(ii) Any Restricted Definitive Note may be exchanged by the
Holder thereof for an Unrestricted Definitive Note or transferred to a
Person or Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to an
Exchange Offer in accordance with the corresponding Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, is not (1) a broker-dealer, (2)
a Person participating in the distribution of the Exchange Notes or (3)
a Person who is an affiliate (as defined in Rule 144) of the Company;
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45
(B) any such transfer is effected pursuant to a Shelf
Registration Statement in accordance with the corresponding
Registration Rights Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to an Exchange Offer Registration Statement in
accordance with the corresponding Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit C hereto, including
the certifications in Item (1)(b) thereof;
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take delivery
thereof in the form of an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit B hereto, including the
certifications in Item (4) thereof; and
(3) in each such case set forth in this subparagraph (D),
an Opinion of Counsel in form reasonably acceptable to the Trustee and
the Company to the effect that such exchange or transfer is in
compliance with the Securities Act, that the restrictions on transfer
contained herein and in the Private Placement Legend are not required
in order to maintain compliance with the Securities Act, and such
Restricted Definitive Note is being exchanged or transferred in
compliance with any applicable blue sky securities laws of any State of
the United States.
(iii) A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request for such a transfer, the
Registrar shall register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof. Unrestricted Definitive Notes cannot
be exchanged for or transferred to Persons who take delivery thereof in the
form of a Restricted Definitive Note.
(f) Exchange Offer. Upon the occurrence of an Exchange Offer in
accordance with the corresponding Registration Rights Agreement, the Company
shall issue and, upon receipt of (A) an authentication order in accordance with
Section 2.02 hereof and (B) an Opinion of Counsel opining as to the
enforceability of the Exchange Notes and the guarantees thereof, the Trustee
shall authenticate (i) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial interests in
the Restricted Global Notes tendered for acceptance by Persons that are not (1)
broker-dealers, (2) Persons participating in the distribution of the Exchange
Notes or (3) Persons who are affiliates (as defined in Rule 144) of the Company
and accepted for exchange in such Exchange Offer and (ii) Definitive Notes in
an aggregate principal
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amount equal to the principal amount of the Restricted Definitive Notes
accepted for exchange in such Exchange Offer, unless the Holders of such
Restricted Definitive Notes shall request the receipt of Definitive Notes, in
which case the Company shall execute and the Trustee shall authenticate and
deliver to the Persons designated by the Holders of such Restricted Definitive
Notes one or more Definitive Notes without the Private Placement Legend in the
appropriate principal amount. Concurrent with the issuance of such
Unrestricted Global Notes, the Trustee shall cause the aggregate principal
amount of the applicable Restricted Global Notes to be reduced accordingly, and
the Company shall execute and the Trustee shall authenticate and make available
for delivery to the Persons designated by the Holders of Definitive Notes so
accepted Definitive Notes in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES (1)
NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO (X) THE DATE
THAT IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k)
UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF (OR ANY PREDECESSOR OF THIS SECURITY) AND THE
LAST DAY ON WHICH TESORO PETROLEUM CORPORATION (THE "COMPANY") OR ANY AFFILIATE
OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND
(Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS (THE "RESALE
RESTRICTION TERMINATION DATE"), EXCEPT (A) TO THE COMPANY OR A SUBSIDIARY
THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT IS
ACQUIRING SUCH NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
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INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) (AN
"INSTITUTIONAL ACCREDITED INVESTOR") THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS RELATING TO
RESTRICTIONS ON TRANSFER OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM THE TRUSTEE), (E) PURSUANT TO OFFERS AND SALES TO NON-U.S.
PERSONS THAT OCCUR IN AN "OFFSHORE TRANSACTION" WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND (2)
THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE
TRUSTEE, THE TRANSFER AGENT AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (C), (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING
CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS
NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THE HOLDER
HEREOF, BY PURCHASING THIS NOTE, REPRESENTS AND AGREES FOR THE BENEFIT OF THE
COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A, (2) AN INSTITUTIONAL ACCREDITED INVESTOR, (3) A NON-U.S. PERSON AND
IS ACQUIRING THE NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO REGULATION S
UNDER THE SECURITIES ACT OR (4) IT IS A PERSON ELIGIBLE TO BE TRANSFERRED THIS
NOTE IN ACCORDANCE WITH CLAUSE (F) OF THE FOREGOING SENTENCE. THIS LEGEND WILL
BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER
THE SECURITIES ACT."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraph (b)(iv), (c)(iii),
(d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) of this Section 2.06 (and
all Notes issued in exchange therefor or substitution thereof) shall
not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER
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ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO ARTICLE II OF THE INDENTURE, (II) THIS GLOBAL NOTE
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF TESORO PETROLEUM CORPORATION."
Additionally, for so long as DTC is the Depositary with respect to any
Global Note, each such Global Note shall also bear a legend in substantially the
following form:
"UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), 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."
(iii) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note shall bear a legend in substantially the following
form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled 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 or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note, by the
Trustee, the Note Custodian or the Depositary at the direction of the Trustee,
to reflect such reduction; and if the beneficial interest is being exchanged for
or transferred
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to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note, by the Trustee, the Note
Custodian or by the Depositary at the direction of the Trustee, to reflect such
increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, subject to
Section 2.06, the Company shall execute and, upon the Company's order, the
Trustee shall authenticate Global Notes and Definitive Notes at the
Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment of
a sum sufficient to cover any transfer tax or similar governmental charge
payable in connection therewith (other than any such transfer taxes or
similar governmental charge payable upon exchange or transfer pursuant to
Sections 3.06, 4.10, 4.15 and 9.05 hereof).
(iii) The Registrar shall not be required to register the transfer or
exchange of any Note selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture and the Subsidiary
Guarantees, as the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(v) The Company and the Registrar shall not be required (A) to
issue, to register the transfer of or to exchange Notes during a period
beginning at the opening of business 15 days before the day of any selection
of Notes for redemption under Section 3.02 hereof and ending at the close of
business on the day of selection, (B) to register the transfer of or to
exchange any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part, (C) to register the
transfer of or to exchange a Note between a record date and the next
succeeding Interest Payment Date or (D) to register the transfer of a Note
other than in denominations of $1,000 or multiple integrals thereof.
(vi) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent or
the Company shall be affected by notice to the contrary.
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(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06
to effect a transfer or exchange may be submitted by facsimile.
(ix) The Trustee and the Registrar shall have no obligation or
duty to monitor, determine or inquire as to whether any Person is or is
not a Person described in clauses (1), (2) and (3) of each of Sections
2.06(b)(iv)(A), 2.06(c)(iii)(A), 2.06(d)(ii)(A), 2.06(e)(ii)(A) and
2.06(f) hereof or under applicable law (other than the TIA) with respect
to any transfer of any interest in any Note (including any transfers
between or among Participants or beneficial owners of interests in any
Global Note) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do
so if and when expressly required by the terms of, this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
SECTION 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company, or
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon the written
order of the Company signed by one Officer of the Company, shall authenticate a
replacement Note if the Trustee's requirements are met. If required by the
Trustee or the Company, an indemnity bond must be supplied by the Holder that is
sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee and any Agent from any loss that any of them may suffer if
a Note is replaced. The Company and the Trustee may charge for their respective
expenses in replacing a Note. If, after the delivery of such replacement Note, a
bona fide purchaser of the original Note in lieu of which such replacement Note
was issued presents for payment or registration such original Note, the Trustee
shall be entitled to recover such replacement Note from the Person to whom it
was delivered or any Person taking therefrom, except a bona fide purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Company, the
Trustee and any Agent in connection therewith.
Subject to the provisions of the final sentence of the preceding
paragraph of this Section 2.07, every replacement Note is an additional
obligation of the Company and shall be entitled to all of the benefits of this
Indenture equally and proportionately with all other Notes duly issued
hereunder.
SECTION 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this
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Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest and Liquidated Damages, if any,
on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary of the Company
or an Affiliate of any thereof) holds, on a redemption date or maturity date,
money sufficient to pay Notes payable on that date, then on and after that date
such Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest and Liquidated Damages, if any.
SECTION 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded. Notwithstanding the foregoing, Notes that the Company,
a Subsidiary of the Company or an Affiliate of the Company offers to purchase or
acquires pursuant to an offer, exchange offer, tender offer or otherwise shall
not be deemed to be owned by the Company, such Subsidiary or such Affiliate
until legal title to such Notes passes to the Company, such Subsidiary or such
Affiliate, as the case may be.
SECTION 2.10 Temporary Notes.
Until Definitive Notes are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Notes upon a written order of the
Company signed by one Officer of the Company. Temporary Notes shall be
substantially in the form of Definitive Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
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SECTION 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall return such
canceled Notes to the Company. The Company may not issue new Notes to replace
Notes that it has paid or that have been delivered to the Trustee for
cancellation other than as contemplated by an Exchange Offer.
SECTION 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall promptly notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such interest to be paid.
SECTION 2.13 CUSIP Numbers.
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption or repurchase, as the case may be, as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption or repurchase, as the case may be, and that reliance
may be placed only on the other identification numbers printed on the Notes, and
any such redemption or repurchase, as the case may be, shall not be affected by
any defect in or omission of such numbers. The Company will promptly notify the
Trustee of any change in the "CUSIP" numbers.
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ARTICLE III
REDEMPTION AND PREPAYMENT
SECTION 3.01 Notices to Trustee.
If (x) the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date and (y) the
Company redeems Notes pursuant to the redemption provisions of Section 3.10
hereof (a "Special Redemption"), it shall furnish, subject to Section 3.03
hereof, to the Trustee, at least three Business Days before notice of the
Special Redemption is to be mailed to the Holders (unless a shorter notice
period shall be satisfactory to the Trustee, as evidenced by a writing signed by
the Trustee), in each case, 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 Notes to be redeemed, (iv) the
redemption price and (v) that the redemption price will be deposited with the
Trustee in immediately available funds no later than 10:00 a.m., New York City
time, on the redemption date.
SECTION 3.02 Selection of Notes to be Redeemed.
If less than all of the Notes are to be redeemed at any time, selection
of Notes for redemption shall be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot
(except in the case of any Special Redemption) or in accordance with any other
method the Trustee considers fair and appropriate; provided that no Notes of
$1,000 or less shall be redeemed in part. In the event of partial redemption by
lot, the particular Notes to be redeemed shall be selected, unless otherwise
provided herein, not less than 30 nor more than 60 days prior to the redemption
date by the Trustee from the outstanding Notes not previously called for
redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000.
Except as provided in the preceding sentence, provisions of this Indenture that
apply to Notes called for redemption also apply to portions of Notes called for
redemption.
The provisions of the two preceding paragraphs of this Section 3.02 shall
not apply with respect to any redemption affecting only a Global Note, whether
such Global Note is to be redeemed in whole or in part. In case of any such
redemption in part, the unredeemed portion of the principal amount of the Global
Note shall be in an authorized denomination.
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SECTION 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days but
not more than 60 days before a redemption date (other than in connection with a
Special Redemption), the Company shall mail or cause to be mailed, by first
class mail, a notice of redemption to each Holder whose Notes are to be redeemed
at its registered address. In the event of a Special Redemption, at least three
Business Days before a Special Redemption, the Company shall mail or cause to be
mailed a notice of redemption by first class mail, postage prepaid, to each
Holder, with a copy to the Trustee. In the event of a Special Redemption on the
Special Redemption Date, the Company shall provide the Trustee with written
notice on or prior to 9:30 a.m., New York City time on the Business Day
immediately preceding the Special Redemption Date to effect such Special
Redemption; provided that failure to provide any such notice of a Special
Redemption shall not affect the Company's right to effect a Special Redemption
on the Special Redemption Date, or the amount of the Company's obligation on the
Notes.
The notice shall identify the Notes (including CUSIP numbers) to be
redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest and Liquidated Damages, if any, on Notes called for redemption
cease to accrue on and after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.
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If any of the Notes to be redeemed is in the form of a Global Note,
then the Company shall modify such notice to the extent necessary to accord
with the Applicable Procedures of the Depositary applicable to such redemption.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that
the Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as
provided in the preceding paragraph.
SECTION 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05 Deposit of Redemption Price.
No later than 10:00 a.m. New York City Time on the redemption date
(other than in connection with a Special Redemption), the Company shall deposit
with the Trustee or with the Paying Agent immediately available funds
sufficient to pay the redemption price of and accrued interest and Liquidated
Damages, if any, on all Notes to be redeemed on that date. The Trustee or the
Paying Agent shall promptly return to the Company any money deposited with the
Trustee or the Paying Agent by the Company in excess of the amounts necessary
to pay the redemption price of, and accrued interest and Liquidated Damages, if
any, on, all Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph
or in the case of a Special Redemption, from and after the Special Redemption
Date or such earlier date of a Special Redemption in accordance with Sections
3.03 and 3.10 hereof, on and after the redemption date, interest and Liquidated
Damages, if any, shall cease to accrue on the Notes or the portions of Notes
called for redemption. If a Note is redeemed on or after an interest record
date but on or prior to the related interest payment date, then any accrued and
unpaid interest and Liquidated Damages, if any, shall be paid to the Person in
whose name such Note was registered at the close of business on such record
date. If any Note called for redemption shall not be so paid upon surrender
for redemption because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption date until such principal is paid, and to the extent lawful on any
interest not paid on such unpaid principal, in each case at the rate provided
in the Notes and in Section 4.01 hereof.
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SECTION 3.06 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
SECTION 3.07 Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.07, the
Notes shall not be redeemable at the Company's option prior to July 1, 2003.
Thereafter, the Notes will be subject to redemption at any time or from time to
time at the option of the Company, in whole or in part, upon not less than 30
nor more than 60 days' notice, at the redemption prices (expressed as
percentages of principal amount) set forth below plus accrued and unpaid
interest and Liquidated Damages, if any, thereon, if any, to the applicable
redemption date, if redeemed during the twelve-month period beginning on July 1
of the years indicated below:
YEAR PERCENTAGE
2003 . . . . . . . . . . . . . . . . . . . 104.5%
2004 . . . . . . . . . . . . . . . . . . . 103.0%
2005 . . . . . . . . . . . . . . . . . . . 101.5%
2006 and thereafter . . . . . . . . . . . . 100.0%
(b) Notwithstanding the foregoing, at any time or from time to time
before July 1, 2001, the Company may on any one or more occasions redeem up to
35% of the aggregate principal amount of Notes outstanding at a redemption price
of 109% of the principal amount thereof, plus accrued and unpaid interest, if
any, and Liquidated Damages, if any, thereon, to the redemption date, with the
net cash proceeds of any one or more Public Equity Offerings; provided that at
least 65% of the aggregate principal amount of Notes outstanding on the Issue
Date remain outstanding immediately after each occurrence of such redemption;
and provided, further, that each such redemption shall occur within 90 days of
the date of the closing of such Public Equity Offering.
(c) 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 3.09, 3.10, 4.10 and 4.15 hereof, the
Company shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
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SECTION 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company shall be
required to commence an offer to all Holders to purchase Notes (an "Asset Sale
Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Company shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.10 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Notes validly tendered in response to
the Asset Sale Offer. Payment for any Notes so purchased shall be made in the
same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest and
Liquidated Damages, if any, shall be paid to the Person in whose name a Note is
registered at the close of business on such record date, and no additional
interest or Liquidated Damages shall be payable to Holders who tender Notes
pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send, by
first class mail, a notice to each of the Holders, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Asset Sale Offer. The Asset Sale Offer
shall be made to all Holders. The notice, which shall govern the terms of the
Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer shall
remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrete or accrue interest and Liquidated Damages, if any;
(d) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrete or accrue interest and Liquidated Damages, if any, after the Purchase
Date;
(e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may only elect to have all of such Note purchased and may not
elect to have only a portion of such Note purchased;
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(f) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed to the
Company, the Depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, such depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Trustee shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Trustee so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).
If any of the Notes subject to an Asset Sale Offer is in the form of a
Global Note, then the Company shall modify such notice to the extent necessary
to accord with the Applicable Procedures of the Depositary applicable to such
repurchases.
On or before the Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and
shall deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.09. The Company, the depositary (if any, and as referred
to in clause (f) above of this Section 3.09) or the Paying Agent, as the case
may be, shall promptly (but in any case not later than five days after the
Purchase Date) mail or deliver to each tendering Holder an amount equal to the
purchase price of the Notes tendered by such Holder and accepted by the Company
for purchase, and the Company, shall promptly issue a new Note, and the Trustee,
upon written request from the Company shall authenticate and make available for
delivery such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
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SECTION 3.10 Special Redemption.
If the Washington Acquisition is not consummated by the Company, or the
Washington Agreement is terminated without consummation of the Washington
Acquisition, on or prior to December 31, 1998, the Company shall redeem 50% of
the aggregate principal amount of the Original Notes at a redemption price equal
to 101% of the redeemed principal amount thereof (the "Special Redemption
Price"), plus accrued interest and Liquidated Damages, if any, to the date of
redemption. The date for such redemption (the "Special Redemption Date") shall
be the earlier of December 31, 1998 and ten business days following the date of
termination of the Washington Agreement without consummation of the Washington
Acquisition. Selection of Notes for special redemption will be made by the
Trustee in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed, or, if the Notes are not so
listed, on a pro rata basis or by such method other than by lot as the Trustee
shall deem fair and appropriate; provided that no Notes of $1,000 or less shall
be redeemed in part. Notice of the Special Redemption to the Trustee and the
Holders shall be made in accordance with Sections 3.01 and 3.03 hereof.
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ARTICLE IV
COVENANTS
SECTION 4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal of, and premium,
if any, interest and Liquidated Damages, if any, on, the Notes on the dates and
in the manner provided in the Notes. Principal, premium, if any, interest and
Liquidated Damages, if any, shall be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of
10:00 a.m. New York City Time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, interest and Liquidated Damages, if any, then due.
The Company shall pay all Liquidated Damages, if any, in the same manner on the
dates and in the amounts set forth in the corresponding Registration Rights
Agreement.
The Company shall pay interest (including post-petition interest in any
proceeding under the Bankruptcy Code) on overdue principal at the rate borne on
the Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under the Bankruptcy Code) on overdue installments of
interest and Liquidated Damages, if any, (without regard to any applicable grace
period) at the same rate to the extent lawful.
SECTION 4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be presented or
surrendered for payment, where Notes may be surrendered for registration of
transfer or for exchange and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
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The Company hereby designates the office of the Trustee at 100 Wall
Street, 20th Floor, New York, New York, 10005, as one such office or agency of
the Company in accordance with Section 2.03 hereof.
SECTION 4.03 Reports.
(a) Whether or not required by the rules and regulations of the SEC,
so long as any Notes are outstanding, the Company shall furnish to each of the
Holders of Notes, beginning with annual financial information for the year ended
December 31, 1998, (i) all quarterly and annual financial information with
respect to the Company and its Subsidiaries that would be required to be
contained in a filing with the SEC on Forms 10-Q and 10-K if the Company 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 Company's independent public
accountants and (ii) all current reports that would be required to be filed with
the SEC on Form 8-K if the Company were required to file such reports. All such
information and reports shall be mailed or otherwise delivered to the Holders of
Notes within 15 days after the dates on which such filings would have been
required to be made had the Company been subject to the rules and regulations of
the SEC. In addition, whether or not required by the rules and regulations of
the SEC, the Company shall file a copy of all such information and reports with
the SEC for public availability within the time periods specified in the SEC's
rules and regulations (unless the SEC will not accept such a filing) and make
such information available to securities analysts and prospective investors upon
request. The Company shall at all times comply with TIA Section 314(a).
(b) For so long as any Initial Notes remain outstanding, the Company
shall furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.
(c) Delivery of such reports, information and documents to the
Trustee is for informational purposes only, and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 4.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
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Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(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(a) above shall be accompanied by a
written statement of the Company's independent public accountants that in making
the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article IV or Article V 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 future knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any executive Officer having knowledge
that an event or circumstance constitutes a Default or an Event of Default and
that such event or circumstance has occurred and is existing, an Officers'
Certificate specifying such Default or Event of Default and what action the
Company is taking or proposes to take with respect thereto.
SECTION 4.05 Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, charges, assessments, and governmental
levies except such as are contested in good faith and, if required, by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.
SECTION 4.06 Waiver of Stay, Extension and Usury Laws.
Each of the Company and the Guarantors covenants (to the extent that it
may lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and each of the
Company and the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
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SECTION 4.07 Restricted Payments.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or
make any other payment or distribution on account of the Company's or any of
its Restricted Subsidiaries' Equity Interests (including, without limitation,
any payment in connection with any merger or consolidation involving the
Company) or to the direct or indirect holders of the Company's or any of its
Restricted Subsidiaries' Equity Interests in their capacity as such, in each
case other than dividends or distributions payable in Equity Interests (other
than Disqualified Stock) of the Company or declared or paid to the Company or
any of its Restricted Subsidiaries; (ii) purchase, redeem or otherwise acquire
or retire for value (including without limitation, in connection with any
merger or consolidation involving the Company) any Equity Interests of the
Company (other than any such Equity Interests owned by a Wholly Owned
Restricted Subsidiary of the Company); (iii) make any payment to purchase,
redeem, defease or otherwise acquire or retire for value any Indebtedness that
is subordinated to the Notes, except a payment of interest or principal at its
Stated Maturity; or (iv) make any Restricted Investment (all such payments and
other actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing;
(b) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in the first paragraph of Section 4.09 hereof; and
(c) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company or any of its Restricted
Subsidiaries after the Issue Date (excluding Restricted Payments permitted by
clauses (ii), (iii), (iv), (v), (vi), (viii) or (ix) of the next succeeding
paragraph), is less than the sum of (i) 50% of the Consolidated Net Income of
the Company for the period (taken as one accounting period) from the beginning
of the first fiscal quarter immediately following the Issue Date to the end of
the Company's most recently ended fiscal quarter for which internal financial
statements are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a loss, less 100% of such loss), plus
(ii) 100% of the aggregate net cash proceeds, or the Fair Market Value of assets
or property other than cash, received by the Company from the issue or sale, in
either case, since the Issue Date of (A) Equity Interests of the Company (other
than Disqualified Stock), or (B) Disqualified Stock or debt securities of the
Company that have been converted into, or exchanged for, such Equity Interests
together with the aggregate cash received at the time of such conversion or
exchange, or received by the Company from any such conversion or exchange of
such debt securities sold or issued prior to the Issue Date other than Equity
Interests (or Disqualified Stock or convertible or exchangeable debt securities)
sold to a Restricted Subsidiary of the Company and other than Disqualified Stock
or debt securities that have been converted or exchanged into Disqualified
Stock, plus (iii) in case
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any Unrestricted Subsidiary has been redesignated a Restricted Subsidiary
pursuant to the terms of this Indenture or has been merged, consolidated or
amalgamated with or into, or transfers or conveys assets to or is liquidated
into, the Company or a Restricted Subsidiary and provided that no Default or
Event of Default shall have occurred and be continuing or would occur as a
consequence thereof, the lesser of (A) the book value (determined in accordance
with GAAP) at the date of such redesignation, combination or transfer of the
aggregate Investments made by the Company and its Restricted Subsidiaries in
such Unrestricted Subsidiary (or of the assets transferred or conveyed, as
applicable) and (B) the Fair Market Value of such Investment in such
Unrestricted Subsidiary at the time of such redesignation, combination or
transfer (or of the assets transferred or conveyed, as applicable), in each
case as determined in good faith by the Board of Directors of the Company,
whose determination shall be conclusive and evidenced by a resolution of such
Board and, in each case, after deducting any Indebtedness of the Unrestricted
Subsidiary so designated or combined or with the assets so transferred or
conveyed, plus (iv) to the extent not already included in Consolidated Net
Income for such period, (A) if any Restricted Investment that was made by the
Company or any Restricted Subsidiary after the Issue Date is sold for cash or
otherwise liquidated or repaid for cash, the cash return of capital with
respect to such Restricted Investment resulting from such sale or disposition
(less the cost of disposition, if any) and (B) with respect to any Restricted
Investment that was made by the Company or any Restricted Subsidiary after the
Issue Date, the net reduction in such Restricted Investment resulting from
payments of interest, dividends, principal repayments and other transfers and
distributions of cash, assets or property, in an amount not to exceed the
aggregate amount of such Restricted Investment, plus (v) $50,000,000.
The foregoing provisions shall not prohibit (i) the payment of any
dividend within 60 days after the date of declaration thereof, if at said date
of declaration such payment would have complied with the provisions of this
Indenture, including the immediately preceding paragraph; (ii) the redemption,
repurchase, retirement, defeasance or other acquisition, prior to its Stated
Maturity, of any (y) Indebtedness (or portion thereof) which is subordinated
to the Notes, or the making of any principal payment thereon, or (z) Equity
Interests of the Company or any Restricted Subsidiary, in each case in exchange
for, or out of the net cash proceeds of the substantially concurrent sale or
issuance (other than to a Restricted Subsidiary of the Company) of, Equity
Interests of the Company (other than any Disqualified Stock); provided that the
amount of any such net cash proceeds that are utilized for any such redemption,
repurchase, retirement, defeasance or other acquisition, or payments, shall be
excluded from clause (c) (ii) of the preceding paragraph; (iii) the making of
any principal payment on, or the defeasance, redemption, repurchase or other
acquisition of, prior to its Stated Maturity, Indebtedness which is
subordinated to the Notes with the net cash proceeds from an incurrence of, or
in exchange for the issuance of, Permitted Refinancing Indebtedness; (iv) the
payment of any dividend or distribution by a Restricted Subsidiary of the
Company to the holders of its common Equity Interests on a pro rata basis; (v)
the repurchase, redemption or other acquisition or retirement for value of any
Equity Interests of the Company or any Restricted Subsidiary of the Company
held by any current or former officer, employee or director of the Company (or
any of its Subsidiaries) pursuant to the terms of agreements (including
employment agreements) and plans approved by the Company's Board of Directors,
including any management equity plan or stock option plan or any other
management or employee benefit plan, agreement or
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trust; provided, however, that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests pursuant to this
clause (v) shall not exceed the sum of (y) $1,000,000 in any twelve-month
period and (z) the aggregate net proceeds received by the Company during such
twelve-month period from issuance of such Equity Interests pursuant to such
agreements or plans; (vi) repurchases of Equity Interests deemed to occur upon
the cashless exercise of stock options; (vii) the purchase, redemption,
defeasance or retirement, in each case prior to its Stated Maturity, of any
Indebtedness that is subordinated to the Notes in right of payment by payments
out of Excess Proceeds remaining after completion of an Asset Sale Offer,
provided that (x) any payments made or value given for such purchase,
redemption, defeasance or retirement shall be made out of, or shall not be in
excess of, any Excess Proceeds remaining after completion of an Asset Sale
Offer (but for the provision of the last sentence of Section 4.10 hereof) and
(y) the Company would, at the time of such payment and after giving pro forma
effect thereto as if such payment had been made at the beginning of the
applicable four-quarter period, have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in the first paragraph of Section 4.09 hereof; (viii) reasonable and
customary directors' fees to the members of the Company's Board of Directors,
provided that such fees are consistent with past practice or current
requirements; and (ix) cash dividends declared or paid in respect of shares of
Mandatorily Convertible Preferred Stock of the Company issued on or prior to
the Issue Date (together with any additional shares issued in respect of any
underwriters' over-allotment option in effect on the Issue Date); provided,
further, that, with respect to clauses (ii), (iii), (v), (vi), (vii), (viii)
and (ix) above, no Default or Event of Default shall have occurred and be
continuing.
In determining whether any Restricted Payment is permitted by the
foregoing covenant, the Company may allocate or reallocate all or any portion of
such Restricted Payment among the clauses (i) through (ix) of the preceding
paragraph or among such clauses and the first paragraph of this covenant
including clauses (a), (b) and (c), provided that at the time of such allocation
or reallocation, all such Restricted Payments, or allocated portions thereof,
would be permitted under the various provisions of the foregoing covenant.
The amount of all Restricted Payments (other than cash) shall be the Fair
Market Value (as determined by the Board of Directors of the Company and as
evidenced by a resolution of the Board of Directors of the Company set forth in
an Officers' Certificate delivered to the Trustee) on the date of the transfer,
incurrence or issuance of such non-cash Restricted Payment. Not later than (i)
the end of any calendar quarter in which any Restricted Payment is made or (ii)
the making of a Restricted Payment which, when added to the sum of all previous
Restricted Payments made in a calendar quarter, would cause the aggregate of all
Restricted Payments made in such quarter to exceed $10,000,000, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payments were permitted and setting forth the basis upon which the
calculations required by this covenant were computed, which calculations may be
based upon the Company's latest available financial statements.
The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary only if (i) immediately after giving effect to such
designation, the Company could incur
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at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage
Ratio test set forth in the first paragraph of Section 4.09 hereof, (ii)
immediately before and immediately after giving effect to such designation, no
Default or Event of Default shall have occurred and be continuing and (iii) the
Company certifies that such designation complies with this covenant. Any such
designation by the Board of Directors shall be evidenced by the Company
promptly filing with the Trustee a copy of the resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
The Board of Directors may designate any Subsidiary of the Company to be
an Unrestricted Subsidiary under the circumstances and pursuant to the
requirements described in the definition of "Unrestricted Subsidiary," which
requirements include that such designation will be made in compliance with this
covenant. For purposes of making the determination as to whether such
designation would be made in compliance with this covenant, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under the first paragraph of this covenant. All such
outstanding Investments will be deemed to constitute Investments in an amount
equal to the greatest of (i) the net book value (determined in accordance with
GAAP) of such Investments at the time of such designation, (ii) the Fair Market
Value of such Investments at the time of such designation and (iii) the original
Fair Market Value of such Investments at the time they were made.
If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of the Indenture, and any
Indebtedness of such Subsidiary shall be deemed to be incurred as of such date.
SECTION 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company or the Company to (i)(x) pay dividends or
make any other distributions to the Company or any of its Restricted
Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest
or participation in, or measured by, its profits, or (y) pay any Indebtedness
owed to the Company or any of its Restricted Subsidiaries, (ii) make loans or
advances to the Company or any of its Restricted Subsidiaries or (iii) transfer
any of its properties or assets to the Company or any of its Restricted
Subsidiaries, except for such encumbrances or restrictions existing under or by
reason of (a) the Indenture, the Notes, Existing Indebtedness and the Senior
Credit Facility as in effect on the Issue Date, any other Credit Facility
hereafter in effect provided to the extent its provisions are no more
restrictive than those in the Senior Credit Facility as it is in effect on the
Issue Date and any future Liens that may be permitted to be granted under, or
incurred not in violation of, any other provisions of the Indenture, (b)
applicable law, (c) any instrument governing Indebtedness or Capital Stock of a
Person acquired by the Company or any of its Restricted Subsidiaries as in
effect at the time of such acquisition (except
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with respect to Indebtedness 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 or such Person's subsidiaries, so
acquired, provided that, in the case of Indebtedness, such Indebtedness was
permitted by the terms of this Indenture to be incurred, (d) restrictions of
the nature described in clause (iii) above by reason of customary
non-assignment provisions in contracts, agreements, and leases entered into in
the ordinary course of business and consistent with customary provisions for
the sale of property, (e) purchase money obligations for property acquired in
the ordinary course of business that impose restrictions of the nature
described in clause (iii) above on the property so acquired, (f) any
restriction with respect to a Restricted Subsidiary of the Company imposed
pursuant to an agreement entered into for the sale or disposition of all or
substantially all of the Capital Stock or assets of such Restricted Subsidiary
pending the closing of such sale or disposition, (g) agreements relating to
secured Indebtedness otherwise permitted to be incurred pursuant to Section
4.09 hereof, and not in violation of Section 4.12 hereof, that limit the right
of the debtor to dispose of assets securing such Indebtedness and (h) Permitted
Refinancing Indebtedness in respect of Indebtedness referred to in clause (a),
(c), (e) and (g) of this paragraph, 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.
SECTION 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), other than Permitted Debt, and the Company shall not issue any
Disqualified Stock and shall not permit any of its Restricted Subsidiaries to
issue any shares of preferred stock other than Permitted Debt; provided,
however, that (a) the Company or any Guarantor may incur Indebtedness (including
Acquired Debt) or (b) the Company may issue shares of Disqualified Stock if the
Company's Fixed Charge Coverage Ratio for the Company's most recently ended four
full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
or such Disqualified Stock is issued would have been at least 2.00 to 1,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred, or the
Disqualified Stock had been issued, as the case may be, at the beginning of such
four-quarter period.
The provisions of the first paragraph of this covenant shall not apply to
the incurrence of any Permitted Debt. Accrual of interest, the accretion of
accreted value and the payment of interest in the form of additional
Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes
of this covenant.
For purposes of determining compliance with this Section 4.09 , in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt or is entitled to be incurred pursuant to the first
paragraph of this Section 4.09, the Company shall, in its sole
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discretion, classify such item of Indebtedness in any manner that complies with
this Section 4.09, and such item of Indebtedness or a portion thereof may be
classified as having been incurred under more than one of the such applicable
categories or pursuant to the first paragraph of this Section 4.09.
SECTION 4.10 Asset Sales.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, engage in an Asset Sale unless (i) the Company or such
Restricted Subsidiary, as the case may be, receives consideration at the time of
such Asset Sale at least equal to the Fair Market Value of the assets or Equity
Interests issued or sold or otherwise disposed of and (ii) at least 75% of the
consideration therefor received by the Company or such Restricted Subsidiary is
in the form of, or any combination of, (A) cash or Cash Equivalents, (B) the
assumption of any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet) of the Company or any Restricted
Subsidiary of the Company (other than liabilities that are by their terms
subordinated to the Notes or any Subsidiary Guarantee) by the transferee of any
such assets pursuant to a customary novation agreement that releases the Company
or such Restricted Subsidiary from further liability and (C) any securities,
notes or other obligations received by the Company or any such Restricted
Subsidiary from such transferee that are converted by the Company or such
Restricted Subsidiary into cash or Cash Equivalents within 30 days following
their receipt (to the extent of the cash or Cash Equivalents received);
provided, that any Asset Sale pursuant to a condemnation, appropriation or other
similar taking, including by deed in lieu of condemnation, or pursuant to the
foreclosure or other enforcement of a Lien incurred not in violation of Section
4.12 hereof or exercise by the related lienholder of rights with respect
thereto, including by deed or assignment in lieu of foreclosure shall not be
required to satisfy the conditions set forth in clauses (i) and (ii) of this
paragraph.
Within 365 days after the receipt of any Net Proceeds from an Asset Sale,
the Company or such Restricted Subsidiary, as the case may be, may apply such
Net Proceeds, at its option, (a) to permanently repay term loans that constitute
Senior Debt, and if no term Senior Debt is outstanding at such time, to repay
outstanding revolving borrowings that constitute Senior Debt, (b) to acquire a
controlling interest in another business or all or substantially all of the
assets of a business, in each case engaged in a Permitted Business, or (c) to
acquire other non-current assets to be used in a Permitted Business, including,
without limitation, assets or Investments of the nature or type described in
clause (m) of the definition "Permitted Investments," provided that the Company
or such Restricted Subsidiary will have complied with clause (b) or (c) if,
within 365 days of such Asset Sale, the Company or such Restricted Subsidiary
shall have commenced and not completed or abandoned an expenditure or
Investment, or a binding agreement with respect to an expenditure or Investment,
in compliance with clause (b) or (c) and such expenditure or Investment is
substantially completed within a date one year and six months after the date of
such Asset Sale. Pending the final application of any such Net Proceeds, the
Company may temporarily reduce Indebtedness under any Credit Facility or
otherwise expend or invest such Net Proceeds in any manner that is not
prohibited by the Indenture. Any Net Proceeds from Asset Sales that are not
applied or invested as provided in the first sentence of this paragraph shall be
deemed to constitute "Excess Proceeds." When the
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aggregate amount of Excess Proceeds exceeds $10,000,000, the Company shall be
required to make an offer to all Holders of Notes and holders of each other
Indebtedness that ranks by its terms pari passu in right of payment with the
Notes and the terms of which contain substantially similar requirements with
respect to the application of net proceeds from asset sales as are contained in
the Indenture (an "Asset Sale Offer") to purchase on a pro rata basis (with the
Excess Proceeds prorated between the Holders and such holders of pari passu
Indebtedness based upon outstanding aggregate principal amounts) the maximum
principal amount of Notes, that is an integral multiple of $1,000, 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 and unpaid interest
and Liquidated Damages thereon, if any, to the date of purchase, in accordance
with the procedures set forth in Section 3.09 hereof. To the extent that the
aggregate amount of Notes and other such Indebtedness tendered pursuant to an
Asset Sale Offer is less than the Excess Proceeds, the Company and its
Restricted Subsidiaries may use any remaining Excess Proceeds for general
corporate purposes and any other purpose not prohibited by the Indenture. If
the aggregate principal amount of Notes surrendered by Holders thereof exceeds
the amount of such prorated Excess Proceeds, the Trustee shall select the 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 Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any payment to, or sell, lease,
transfer or otherwise dispose of any properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate of any such Person (each of the foregoing, an
"Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms that
are no less favorable to the Company or the relevant Restricted Subsidiary than
those that could have been obtained in a comparable transaction by the Company
or such Restricted Subsidiary with an unrelated Person and (ii) the Company
delivers to the Trustee (a) with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess of
$1,000,000, an Officers' Certificate certifying that such Affiliate Transaction
complies with clause (i) above, (b) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate consideration in
excess of $10,000,000, a resolution of its Board of Directors set forth in an
Officers' Certificate certifying that such Affiliate Transaction complies with
clause (i) above and that such Affiliate Transaction has been approved by a
majority of the disinterested members of its Board of Directors, and (c) with
respect to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $10,000,000 and for which there
are no disinterested members of its Board of Directors, an opinion as to the
fairness to the Holders of such Affiliate Transaction from a financial point of
view issued by an Independent Financial Advisor; provided that none of the
following shall be deemed to be Affiliate Transactions: (1) Affiliate
Transactions involving the purchase or sale of crude oil, natural gas and other
hydrocarbons, and refined products therefrom, in the ordinary course of any
Permitted Business, so long as such transactions are priced in line with
industry accepted benchmark prices and the pricing of such transactions are
equivalent to the pricing of comparable
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transactions with unrelated third parties, (2) any employment agreement or
other employee compensation plan or arrangement entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business, (3)
transactions between or among (A) the Company and its Restricted Subsidiaries
and (B) the Restricted Subsidiaries of the Company, (4) fees and compensation
paid to, and indemnity provided on behalf of, officers, directors, employees or
consultants of the Company and of its Restricted Subsidiaries in their capacity
as such, to the extent such fees and compensation are reasonable and customary,
(5) loans or advances to officers, directors and employees for moving,
entertainment and travel expenses, drawing accounts and similar expenditures
and other purposes, in each case in the ordinary course of business, (6)
maintenance in the ordinary course of business of customary benefit programs or
arrangements for employees, officers or directors, including vacation plans,
health and life insurance plans, deferred compensation plans and retirement or
savings plans and similar plans, and (7) fees and compensation paid to, and
indemnity provided on behalf of, officers, directors or employees of the
Company or any of its Restricted Subsidiaries, as determined by the Board of
Directors of the Company or of any such Restricted Subsidiary, to the extent
such fees and compensation are reasonable and customary as determined by the
Board of Directors of the Company or such Restricted Subsidiary.
SECTION 4.12 Liens.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien that secures obligations under any Indebtedness which is pari
passu with or subordinated to the Notes, unless the Notes are equally and
ratably secured with the obligations so secured or until such time as such
obligations are no longer secured by a Lien.
SECTION 4.13 Business Activities.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, engage in any business other than a Permitted Business, except
to such extent as would not be material to the Company and its Restricted
Subsidiaries taken as a whole.
SECTION 4.14 Corporate Existence.
Subject to Articles V and X hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence, and the corporate, partnership or other existence of each
of its Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary; provided, however, that the Company shall not be
required to preserve the existence of any of its Restricted Subsidiaries, if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Restricted
Subsidiaries, taken as a whole.
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SECTION 4.15 Offer to Repurchase upon Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of Notes
will have the right to require the Company to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of such Holder's Notes pursuant to
the offer described below (the "Change of Control Offer") at an offer price in
cash equal to 101% of the aggregate principal amount thereof plus accrued and
unpaid interest and Liquidated Damages, if any, thereon, to the date of purchase
(the "Change of Control Payment").
Within 30 days following any Change of Control, the Company will mail a
notice to each Holder stating: (i) the description of the transaction or
transactions that constitute the Change of Control, that the Change of Control
Offer is being made pursuant to this Section 4.15, and that all Notes validly
tendered and not withdrawn will be accepted for payment; (ii) the purchase price
and the purchase date, which shall be no earlier than 30 days and no later than
60 days from the date such notice is mailed (the "Change of Control Payment
Date"); (iii) that any Note not tendered will continue to accrue interest and
Liquidated Damages, if any; (iv) that, unless the Company defaults in the
payment of the Change of Control Payment, all Notes accepted for payment
pursuant to the Change of Control Offer shall cease to accrue interest and
Liquidated Damages, if any, after the Change of Control Payment Date; (v) that
Holders electing to have any Notes purchased pursuant to a Change of Control
Offer will be required to surrender the Notes properly endorsed, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
properly completed, together with other customary documents as the Company may
reasonably request, 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; (vi) 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 Notes delivered for purchase, and a statement
that such Holder is withdrawing his election to have the Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered, which unpurchased portion must be equal to $1,000 in principal
amount or an integral multiple thereof. If any of the Notes subject to a Change
of Control Offer are in the form of a Global Note, then the Company shall modify
such notice to the extent necessary to accord with the Applicable Procedures of
the Depositary applicable to repurchases. In addition, the Company 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 the repurchase of Notes as a
result of a Change of Control.
(b) On the Change of Control Payment Date, the Company will, to the
extent lawful, (i) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent in immediately available funds an amount equal to the Change of Control
Payment in respect of all Notes or portions thereof so tendered and (iii)
deliver or cause to be delivered to the Trustee the Notes so accepted together
with an Officers'
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Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company. The Paying Agent will promptly mail to each
Holder of Notes so tendered the Change of Control Payment for such Notes, and
the Trustee will promptly authenticate and mail (or cause to be transferred by
book entry) to each Holder a new Note equal in principal amount to any
unpurchased portion of the Notes surrendered, if any; provided that each such
new Note will be in a principal amount of $1,000 or an integral multiple
thereof. Prior to complying with the provisions of this Section 4.15, but in
any event within 90 days following a Change of Control, the Company will either
repay all of its outstanding Senior Debt or obtain the requisite consents, if
any, under all agreements governing such outstanding Senior Debt to permit the
repurchase of Notes required by this covenant. The Company will publicly
announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
(c) The Change of Control provisions described above will be
applicable whether or not any other provisions of this Indenture are applicable,
except as set forth in Article VIII hereof.
(d) The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth herein applicable to a Change of Control Offer made by
the Company and purchases all Notes validly tendered and not withdrawn under
such Change of Control Offer.
SECTION 4.16 No Senior Subordinated Debt.
Notwithstanding any other provision hereof, (i) the Company will not
incur, create, issue, assume, guarantee or otherwise become liable directly or
indirectly for any Indebtedness (including Acquired Debt) that is expressly
subordinate or junior in right of payment to any Senior Debt of the Company and
senior in any respect in right of payment to the Notes, and (ii) no Guarantor
will incur, create, issue, assume, guarantee or otherwise become liable for any
Indebtedness (including Acquired Debt) that is expressly subordinate or junior
in right of payment to any Senior Debt of such Guarantor and senior in any
respect in right of payment to its Subsidiary Guarantee, it being understood
that Indebtedness will not be considered senior to other Indebtedness solely by
reason of being secured.
SECTION 4.17 Limitation on Issuances and Sales of Capital Stock of
Subsidiaries.
The Company (i) will not, and will not permit any Wholly Owned Restricted
Subsidiary of the Company to, transfer, convey, sell or otherwise dispose of any
Capital Stock of any Wholly Owned Restricted Subsidiary of the Company to any
Person (other than the Company or a Wholly Owned Restricted Subsidiary of the
Company), unless (a) such transfer, conveyance, sale, lease or other disposition
is of all the Capital Stock of such Restricted Subsidiary and (b) the net
proceeds from such transfer, conveyance, sale, lease or other disposition are
applied in accordance with Section 4.10 hereof, and (ii) will not permit any
Wholly Owned Restricted Subsidiary of the Company to issue any of its Equity
Interests to any Person other than to the Company or a Wholly
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Owned Restricted Subsidiary of the Company, subject to dispositions and
issuances permitted by clauses (i) and (ii) of the definition of "Wholly Owned
Restricted Subsidiary."
SECTION 4.18 Additional Subsidiary Guarantees.
(a) If any Subsidiary of the Company guarantees any Indebtedness of
the Company, then such Subsidiary shall (i) execute a supplemental indenture
substantially in the form of Exhibit E hereto providing that such Subsidiary
shall become a Guarantor under the Indenture and (ii) deliver an Opinion of
Counsel to the effect that such supplemental indenture has been duly authorized
and executed by such Subsidiary. Neither the Company nor any Guarantor shall be
required to make a notation on the Notes to reflect any such subsequent
Subsidiary Guarantee. Nothing in this Section 4.18 shall be construed to permit
any Restricted Subsidiary of the Company to incur Indebtedness otherwise
prohibited by Section 4.09 hereof.
SECTION 4.19 Payments for Consent.
The Company will not, and will not permit any of its Restricted
Subsidiaries, directly or indirectly to, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder of
any Notes for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of this Indenture or the Notes unless such consideration
is offered to be paid or is paid to all Holders of the Notes that consent, waive
or agree to amend in the time frame set forth in the solicitation documents
relating to such consent, waiver or agreement.
SECTION 4.20 Collateral for Special Redemption.
(a) In order to secure the full and punctual payment and performance
of the Company's obligation, subject to Section 4.20(c), to pay the Special
Redemption Price upon a Special Redemption in the amount of $151,500,000 (the
"Special Redemption Amount"), the Company hereby grants to the Trustee, for the
benefit of the Holders, a continuing security interest in and to the Collateral,
whether now owned or existing or hereafter acquired or arising; provided that
this security interest shall be limited to receipt by the Trustee of the Special
Redemption Amount; and provided further that the security interest granted to
the Trustee hereunder shall not include any of the Company's other property,
including its interest or right to receive capital stock under the Escrow
Agreement upon consummation of the Washington Acquisition. The Company and the
Trustee acknowledge that additional security interests in favor of the lenders
under the Senior Credit Facility may be contemporaneously granted in the
Collateral. The Trustee shall, upon the written request of the Company, execute
and deliver, in its capacity as Trustee for the benefit of the Holders, (i) any
financing statement or other document evidencing or perfecting the security
interests granted hereunder or (ii) any intercreditor agreement among the
Trustee and lenders under the Senior Credit Facility or their agents for the
purpose of clarifying the relative rights of the parties in respect of the
Collateral. The Trustee shall not be liable or accountable for any losses
resulting from entering into the foregoing instruments and agreements upon the
direction of the Company.
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(b) If the Washington Acquisition is consummated by the Company on or
prior to December 31, 1998, the Company shall deliver to the Trustee an
Officers' Certificate certifying to that effect. Upon receipt of such Officer's
Certificate, the security interests granted in respect of the Collateral
pursuant to paragraph (a) of this Section 4.20 shall be released by the Trustee,
whereupon the Trustee shall execute and deliver a termination statement or other
instrument evidencing the release of such security interest furnished to the
Trustee by the Company and, should the Trustee receive any funds pursuant to the
Escrow Agreement, the Trustee shall pursuant to the Company's written
instructions, remit all such funds to the Company.
(c) In the event cash or investment proceeds are received by the
Trustee (in its capacity as Trustee) pursuant to the Escrow Agreement and prior
to the Special Redemption Date from or in respect of the Collateral, the Trustee
shall deposit and maintain such proceeds in an account established for such
purpose (the "Collateral Account"), which account shall be under the sole
dominion and control of the Trustee. Amounts deposited in the Collateral Account
shall be invested and reinvested in Cash Equivalents from time to time in
accordance with applicable law as directed by the Company in writing with such
investment held in the Collateral Account. Any income received with respect to
the balance from time to time standing to the credit of the Collateral Account,
including any interest or capital gains on Cash Equivalents, shall so long as no
Default or Event of Default shall have occurred and be continuing, be
distributed (free of any Lien created hereby) to the Company, as and when
instructed by the Company, so long as the balance thereof is at all times at
least equal to the Special Redemption Amount. The Trustee shall not be liable or
accountable for any losses resulting without negligence on the part of the
Trustee from the sale or depreciation in the market value of any investment of
amounts on deposit in the Collateral Account. Subject to Article VII hereof and
the provisions of the Escrow Agreement, the Trustee solely in its individual
capacity, and in any other capacity it may now or hereafter have (other than
under this Indenture or the Escrow Agreement) hereby waives any rights it may
have in such respective capacities to the Collateral Account and the Collateral,
and all funds and investments therein including any such rights arising through
any counterclaim, defense, recoupment, charge, lien or right of set-off.
(d) Upon notice from the Company to the Trustee pursuant to Section
3.01 hereof of a Special Redemption, all funds in the Collateral Account up to
the Special Redemption Amount (the "Collateral Funds") shall be applied, or paid
to the Paying Agent, to fund the Special Redemption Price, whereupon the
security interests in the Collateral shall terminate as of the date of such
application and the Trustee shall pay any amount in the Collateral Account in
excess of the amount needed to fund the Special Redemption Price to the Company.
Upon receipt of a notice pursuant to Section 4.20(b) or upon payment by the
Company of the Special Redemption Price in connection with a Special Redemption
(whether or not with the Collateral) to the Holders of the Notes, or any Paying
Agent or the Trustee for payment to Holders of the Notes, the Trustee shall
execute, deliver or acknowledge, upon written request of the Company, any
necessary or proper instruments of termination or release, to evidence the
release of any Collateral permitted to by released pursuant to this Section
4.20. In addition, if the Special Redemption is effectuated with funds of the
Company distinct of the Collateral, then upon the Company's written instructions
to
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the Trustee to such effect, it shall remit the Collateral (including all funds
in the Collateral Account) to the Company. TIA Section 314(d) shall not apply
to the release of Collateral pursuant to this provision if such release occurs
prior to the filing of the Exchange Offer Registration Statement pursuant to
the Registration Rights Agreement, after which time this sentence shall be
deemed deleted from this Indenture.
(e) The parties intend that the Trustee shall have "control" of the
Collateral Account and the Collateral Funds (including all securities therein)
within the meaning of, and to the extent governed by, Article 8 of the Uniform
Commercial Code as in effect in the State of New York on the Issue Date, and
shall not release Collateral Funds, if any, except as provided in this Section
4.20.
ARTICLE V
SUCCESSORS
SECTION 5.01 Merger, Consolidation, or Sale of Assets.
The Company will not consolidate or merge with or into (whether or not
the Company is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets in one or more related transactions, to another Person, unless (i) the
Company is the resulting, transferee or surviving Person or the Person formed by
or surviving any such consolidation or merger (if other than the Company) or to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made is a corporation 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 Company) or the Person to whom such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made assumes all the obligations
and covenants of the Company under the Notes and the Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee; (iii)
immediately before and after such transaction no Default or Event of Default
shall have occurred and be continuing; and (iv) except in the case of a merger
of the Company with or into a Wholly Owned Restricted Subsidiary, the Company or
the Person formed by or surviving any such consolidation or merger (if other
than the Company), or to whom such sale, assignment, transfer, lease, conveyance
or other disposition shall have been made (A) will have Consolidated Net Worth
immediately after the transaction equal to or greater than the Consolidated Net
Worth of the Company immediately preceding the transaction and (B) will, 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 the first paragraph of Section
4.09 hereof.
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SECTION 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 5.01 hereof, the successor Person
formed by such consolidation or into or with which the Company is merged or to
whom 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 "Company" shall refer instead to
such successor Person and not to the Company), and may exercise every right and
power of, the Company under this Indenture and the Notes with the same effect as
if such successor Person had been named as the Company herein; and when such
successor corporation duly assumes all of the obligations and covenants of the
Company pursuant to the Notes and hereto, except in the case of a lease of all
or substantially all of the properties or assets in one or more related
transactions, the predecessor Person shall be relieved of all such obligations.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default.
An "Event of Default" occurs if:
(a) the Company defaults in the payment when due of interest on, or
Liquidated Damages, if any, with respect to, the Notes and such default
continues for a period of 30 days (whether or not prohibited by Article 10
hereof);
(b) the Company defaults in the payment when due of principal of or
premium, if any, on the Notes (whether or not prohibited by Article 10 hereof);
(c) the Company or any of its Restricted Subsidiaries fails to comply
with any of the provisions of Sections 3.10, 4.10, 4.15 or 5.01 hereof;
(d) the Company or any of its Restricted Subsidiaries fails to
observe or perform any covenant or other agreement in this Indenture or the
Notes (other than the provisions expressly set forth in clause (c) above) for 60
days after written notice of such failure to the Company by the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding;
(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 Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any of its
Restricted Subsidiaries), whether such Indebtedness or guarantee now exists, or
is created after the Issue Date, which default (i) is caused by a failure to pay
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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 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 without duplication $15,000,000 or more, and such
default shall not have been cured or waived or any such acceleration rescinded
within ten Business Days after the running of such grace period or the
occurrence of such acceleration;
(f) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company or
any of its Restricted Subsidiaries, and such judgment or judgments remain
unpaid, unstayed or undischarged for a period (during which execution shall not
be effectively stayed) of 60 days, provided that the aggregate of all such
unpaid or undischarged judgments exceeds $15,000,000 (excluding amounts covered
by insurance);
(g) the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, when taken together, would constitute a Significant
Subsidiary pursuant to or within the meaning of the Bankruptcy Code:
(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;
(h) a court of competent jurisdiction enters an order or decree under
the Bankruptcy Code that:
(i) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, when taken together, would
constitute a Significant Subsidiary, in an involuntary case;
(ii) appoints a Custodian of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, when taken
together, would constitute a Significant Subsidiary, or for all or
substantially all of the property of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, when taken
together, would constitute a Significant Subsidiary; or
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(iii) orders the liquidation of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, when taken
together, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive
days; or
(i) except as permitted herein, any 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 any Guarantor, or any Person
acting on behalf of any Guarantor, shall deny or disaffirm its obligations under
its Subsidiary Guarantee (other than by reason of the termination of this
Indenture or the release of any such Subsidiary Guarantee in accordance with
this Indenture).
SECTION 6.02 Acceleration.
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 Notes may
declare all the Notes to be due and payable immediately. Upon any such
declaration, the Notes shall become due and payable immediately. Notwithstanding
the foregoing, if an Event of Default specified in clause (g) or (h) of Section
6.01 hereof occurs with respect to the Company or any Significant Subsidiary or
any group of Subsidiaries that, taken together, would constitute a Significant
Subsidiary, all outstanding Notes shall be due and payable immediately without
further action or notice. The Holders of at least a majority in aggregate
principal amount of the then outstanding Notes by written notice to the Trustee
may on behalf of all of the Holders 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 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, interest and
Liquidated Damages, if any, on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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SECTION 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of interest or Liquidated Damages, if any, on, or the principal of, the
Notes including in connection with an offer to purchase; provided, however, that
the Holders of a majority in aggregate principal amount of then outstanding
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration, to the extent permitted by
applicable law. Upon any such waiver, such Default or Event of 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 Event of Default or impair any
right consequent thereon.
SECTION 6.05 Control by Majority.
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
SECTION 6.06 Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note has previously given to the Trustee written
notice of a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense to be incurred in compliance with such request;
(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
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(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and
Liquidated Damages, if any, and interest on the Note, on or after the respective
due dates expressed in the Note (including in connection with an offer to
purchase or redemption), 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.
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 Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09 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 Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 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
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properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes
or the rights of any Holder, or to authorize the Trustee to vote in respect of
the claim of any Holder in any such proceeding.
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, expense, and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
SECTION 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the cost of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
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ARTICLE VII
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 Trustee need perform only those duties that are
specifically set forth in this Indenture and the TIA and no others, and
no implied covenants or obligations shall be read into this Indenture
against the Trustee. To the extent of any conflict between the duties of
the Trustee hereunder and under the TIA, the TIA shall control.
(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 (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(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.
(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.
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(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 Company.
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 (whether in
its original or facsimile form) believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its selection and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(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
(including fees and expenses of its agents and counsel) that might be incurred
by it in compliance with such request or direction.
SECTION 7.03 Individual Rights of Trustee.
The Trustee, in its individual or any other capacity, may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any
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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 Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
actually known to a Responsible Officer of the Trustee, the Trustee shall mail
to Holders of Notes a notice of the Default or Event of Default within 90 days
after the later of (a) the date the Default or Event of Default shall have
occurred and (b) the date such Responsible Officer first had such actual
knowledge. Except in the case of a Default or Event of Default in payment of
principal of, or interest on, any Note, 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 Notes.
SECTION 7.06 Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA Section 313(a) (but if no event described in TIA
Section 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA
Section 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA Section 313(d). The Company
shall promptly notify the Trustee when the Notes are listed on any stock
exchange or delisted therefrom.
SECTION 7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such compensation
for its acceptance of this Indenture and services hereunder as such parties
shall agree from time to time. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an
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express trust. The Company shall reimburse the Trustee promptly upon request
for all reasonable disbursements, advances and expenses incurred or made by it
in addition to the compensation for its services. Such expenses shall include
the reasonable compensation, disbursements and expenses of the Trustee's agents
and counsel.
The Company shall indemnify each of the Trustee and any predecessor
Trustee against any and all losses, liabilities, claims, damages or expenses
incurred by it arising out of or in connection with the acceptance or
administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company (including this Section
7.07) and defending itself against any claim (whether asserted by the Company 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, claim, damage or expense may be attributable to its
negligence, bad faith or willful misconduct. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim, and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel, and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
pay for any settlement made without its consent, which consent shall not be
unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such Lien shall survive the satisfaction and discharge of this
Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) or (h) 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 the
Bankruptcy Code.
The Trustee shall comply with the provisions of TIA Section 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 Company. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
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(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 the Bankruptcy Code;
(c) a Custodian takes charge of the Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee (at the expense of
the Company), the Company, or the Holders of Notes of at least 10% in principal
amount of the then outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10 hereof, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders of the Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company'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. As
soon as practicable, the successor Trustee shall mail a notice of its succession
to the Company and the Holders of the Notes.
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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 $50,000,000
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 Section 310(a)(1), (2) and (5). The Trustee is subject to TIA Section
310(b).
SECTION 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE VIII
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 8.01 Satisfaction and Discharge of Indenture.
This Indenture shall upon delivery of a written request of an Officer of
the Company to the Trustee cease to be of further effect with respect to the
Notes (except as to any surviving rights of registration of transfer or exchange
of Notes herein expressly provided for), and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, when
(a) either
(i) all such Notes theretofore authenticated and delivered
(other than (1) such Notes which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 2.07 hereof and
(2) such Notes for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 8.08 hereof) have been delivered to the Trustee for cancellation;
or
(ii) all such Notes not theretofore delivered to the Trustee for
cancellation
(A) have become due and payable by reason of the making of
a notice of redemption or otherwise,
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(B) will become due and payable at their final Stated
Maturity within one year, or
(C) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense of,
the Company,
and the Company, in the case of (A) , (B) or (C) above, has deposited or caused
to be deposited with the Trustee as trust funds , in trust solely for the
purpose and the benefit of the Holders of such Notes, an amount of U.S. Dollars
or non-callable Government Securities , or a combination thereof, sufficient,
without consideration of any reinvestment of interest, to pay and discharge the
entire indebtedness on such Notes not theretofore delivered to the Trustee for
cancellation, for principal and any premium and interest and Liquidated
Damages, if any, to the date of such deposit (in the case of such Notes which
have become due and payable) or to the Stated Maturity or redemption date (as
the case may be) of the principal of the Notes;
(b) no Default or Event of Default with respect to this Indenture or
the Notes shall have occurred and be continuing on the date of such deposit or
shall occur as a result of such deposit (other than a Default or Event of
Default resulting from the incurrence of Indebtedness or the grant of Liens
securing such Indebtedness, all or a portion of the proceeds of which will be
used to defease the Notes pursuant to this Article VIII concurrently with such
incurrence or within 30 days thereof), and such deposit will not result in a
breach or violation of, or constitute a default under, any material instrument
to which the Company is a party or by which the Company is bound;
(c) the Company has paid or caused to be paid all other sums payable
hereunder by the Company with respect to such Notes; and
(d) the Company has delivered to the Trustee (i) irrevocable
instructions under the Indenture to apply the deposited funds toward the payment
of such Notes at their Stated Maturity or the redemption date, as the case may
be, and (ii) or an Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Notes, the obligations of the Company to the Trustee under
Section 7.07 hereof, and, if U.S. dollars or Government Securities shall have
been deposited with the Trustee pursuant to subclause (ii) of clause (a) of this
Section, the obligations of the Company or Trustee under Section 8.02 hereof and
Section 8.08 hereof shall survive.
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SECTION 8.02 Application of Trust Money.
Subject to the provisions of Section 8.08 hereof, all money and
Government Securities deposited with the Trustee pursuant to Section 8.01 hereof
shall be held in trust and applied by it, in accordance with the provisions of
the Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal, any
Liquidated Damages, and any premium and interest for whose payment such money or
Government Securities has been deposited with the Trustee.
SECTION 8.03 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, exercise its
right under either Section 8.04 or 8.05 hereof with respect to all outstanding
Notes upon compliance with the conditions set forth below in this Article VIII.
SECTION 8.04 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.03 hereof of the option
applicable to this Section 8.04, each of the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.06 hereof,
be deemed to have discharged its obligations with respect to all outstanding
Notes and, as applicable, its Subsidiary Guarantees on the date the conditions
set forth below are satisfied (hereinafter, "Legal Defeasance"). For this
purpose, Legal Defeasance means that each of the Company and the Guarantors
shall be deemed to have paid and discharged the entire Indebtedness represented
by the outstanding Notes, and to the extent applicable, represented by the
Subsidiary Guarantees, which in each case shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.07 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes or Subsidiary Guarantees
and this Indenture (and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging the same), except for
the following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to receive
solely from the trust fund described in Section 8.06 hereof, and as more fully
set forth in such Section, payments in respect of the principal of, and premium,
if any, and interest and Liquidated Damages, if any, on, such Notes when such
payments are due, (b) the Company's obligations with respect to such Notes under
Sections 2.03, 2.04, 2.07, 2.10 and 4.02 hereof, (c) the rights, powers, trusts,
duties and immunities of the Trustee hereunder and the Company's obligations in
connection therewith and (d) this Article VIII. Subject to compliance with this
Article VIII, the Company may exercise its option under this Section 8.04
notwithstanding the prior exercise of its option under Section 8.05 hereof.
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SECTION 8.05 Covenant Defeasance.
Upon the Company's exercise under Section 8.03 hereof of the option
applicable to this Section 8.05, each of the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 8.06 hereof,
be released from its obligations under the covenants contained in Article IV
hereof (other than those in Sections 4.01, 4.02, 4.06 and 4.14), Article V
hereof and Section 11.03 hereof on and after the date the conditions set forth
below are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document, and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. In addition, upon the Company's exercise under Section
8.03 hereof of the option applicable to this Section 8.05 hereof, subject to the
satisfaction of the conditions set forth in Section 8.06 hereof, Sections
6.01(e) through 6.01(g) hereof and 6.01(i) hereof shall not constitute Events of
Default.
SECTION 8.06 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 8.04 or 8.05 hereof in order to exercise either Legal Defeasance or
Covenant Defeasance with respect to the outstanding Notes:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, and premium, if any, and interest and Liquidated
Damages, if any, on, the outstanding Notes on the stated maturity or on the
applicable repurchase or redemption date, as the case may be, and the Company
must specify whether the Notes are being defeased to maturity or to a particular
repurchase or redemption date;
(b) in the case of an election under Section 8.04 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize
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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 8.05 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness or the grant of Liens securing
such Indebtedness, all or a portion of the proceeds of which will be used to
defease the Notes pursuant to this Article VIII concurrently with such
incurrence or within 30 days thereof) or insofar as Section 6.01(g) or 6.01(h)
hereof is concerned, at any time in the period ending on the 91st day after the
date of deposit;
(e) such deposit will not result in a breach or violation of, or
constitute a default under, any material agreement or instrument (other than
this Indenture) to which the Company or any of its Restricted Subsidiaries is a
party or by which the Company or any of its Restricted Subsidiaries is bound, or
if such breach, violation or default would occur, which is not waived as of, and
for all purposes, on and after, the date of such deposit;
(f) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that on 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 Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders of Notes over the other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding creditors of the
Company or others; and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
SECTION 8.07 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.08 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes
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of this Section 8.07, the "Trustee") pursuant to Section 8.06 hereof in respect
of the outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest and Liquidated Damages, if any, but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.06 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article VIII to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.06 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 8.06(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.
SECTION 8.08 Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, or premium, if any,
or interest and Liquidated Damages, if any, on, any Note and remaining unclaimed
for two years after such principal, and premium, if any, or interest and
Liquidated Damages, if any, has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter, as a secured creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 8.09 Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. dollars or
non-callable Government Securities in accordance with Section 8.04 or 8.05
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 Company's obligations under this Indenture and the Notes
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shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.04 or 8.05 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.04 or 8.05
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, or premium, if any, or interest and Liquidated
Damages, if any, on, any Note following the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 hereof, the Company and the Trustee may
amend or supplement this Indenture or the Notes without the consent of any
Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article II hereof (including
the related definitions) in a manner that does not materially adversely affect
any Holder;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Notes in the case of a merger, consolidation or sale of assets of
the Company pursuant to Article V hereof or of any Guarantor pursuant to Article
XI hereof or to add any Person as a Guarantor hereunder or to release any
Guarantor or otherwise comply with Article XI;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any such Holder; or
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA or to allow any
Guarantor to guarantee the Notes.
Upon the request of the Company accompanied by a resolution of its Board
of Directors 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 Company in the execution of any
amended or supplemental indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties,
liabilities or immunities under this Indenture or otherwise.
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SECTION 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including Sections 3.09, 4.10
and 4.15 hereof) and the Notes may be amended or supplemented with the consent
of the Holders of at least a majority in principal amount of the Notes then
outstanding (including consents obtained in connection with the purchase of, or
a tender offer or exchange offer for, the Notes), and, subject to Sections 6.04
and 6.07 hereof, any existing Default or Event of Default or compliance with any
provision of this Indenture or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes
(including consents obtained in connection with a tender offer or exchange offer
for the Notes).
Upon the request of the Company accompanied by a resolution of its Board
of Directors authorizing the execution of any such amended or supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
a Responsible Officer of the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental Indenture unless such amended or supplemental Indenture affects
the Trustee's own rights, duties, liabilities or immunities under this Indenture
or otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 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 Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding may waive
compliance in a particular instance by the Company with any provision of this
Indenture or the Notes. However, without the consent of each Holder affected, an
amendment or waiver may not (with respect to any Notes held by a nonconsenting
Holder):
(a) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver under any provision of this Indenture, the
Notes or any Subsidiary Guarantee;
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(b) reduce the principal of or change the fixed maturity of any Note
or alter or waive in any manner that adversely affects the rights of any Holder
of Notes any of the provisions with respect to the redemption of the Notes
except as provided above with respect to Sections 3.09, 4.10 and 4.15 hereof and
the related definitions;
(c) reduce the rate of or change the time for payment of interest,
including default interest, or Liquidated Damages, if any, on any Note;
(d) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest or Liquidated Damages, if any, on the Notes
(except a rescission of acceleration of the Notes by the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes and a
waiver of the payment default that resulted from such acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change that adversely affects the rights of any Holder
of Notes in the provisions of this Indenture relating to waivers of past
Defaults or make any change to the rights of Holders of Notes to receive
payments of principal of, or premium, if any, or interest or Liquidated Damages,
if any, on the Notes (except as permitted in clause (g) of this Section 9.02);
(g) waive a redemption payment with respect to any Note (other than a
payment required by Sections 3.09, 4.10 and 4.15 hereof); or
(h) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions.
In addition to any consent of Holders required in this Section 9.02, any
amendment to Article X hereof will require the consent of the Holders of at
least 75% in aggregate principal amount of the Notes then outstanding if such
amendment would adversely affect the rights of Holders of Notes.
SECTION 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in a 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 Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment,
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supplement or waiver becomes effective in accordance with its terms and
thereafter binds every Holder.
SECTION 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company, in
exchange for all Notes, may issue and the Trustee shall authenticate new Notes
that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06 Trustee to Sign Amendments, Etc.
The Trustee shall sign any amended or supplemental indenture authorized
pursuant to this Article IX if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Trustee
may, but shall not be obligated to, enter into any such supplemental indenture
which affects the Trustee's own rights, duties, liabilities or immunities under
this Indenture or otherwise. The Company may not sign an amendment or
supplemental indenture until the Board of Directors 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 Officers' Certificate and an Opinion of Counsel stating that the execution of
such amended or supplemental indenture is authorized or permitted by this
Indenture.
ARTICLE X
SUBORDINATION
SECTION 10.01 Agreement to Subordinate.
The Company agrees, and each Holder by accepting a Note agrees, that the
payment of principal of, and premium, if any, and interest and Liquidated
Damages, if any, on the Notes is subordinated in right of payment, to the extent
and in the manner provided in this Article X, to the prior payment in full, in
cash, of all Senior Debt (whether outstanding on the date hereof or hereafter
created, incurred, assumed or guaranteed), and that the subordination is for the
benefit of the holders of Senior Debt.
SECTION 10.02 Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, in
an assignment for the benefit of creditors or any marshaling of the Company's
assets and liabilities, the holders of Senior Debt shall be entitled to receive
payment in
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full, in cash, of all Obligations due in respect of such Senior Debt (including
interest after the commencement of any such proceeding at the rate specified in
the applicable Senior Debt (whether or not an allowable claim)) before the
Holders of the Notes shall be entitled to receive any payment with respect to
the Notes, and until all Obligations with respect to Senior Debt are paid in
full, in cash, pursuant to such liquidation or dissolution, any such
distribution to which the Holders of Notes would be entitled shall be made to
the holders of Senior Debt (except that Holders of Notes may receive and retain
(i) Permitted Junior Securities, (ii) payments and other distributions made
from any defeasance trust created pursuant to Article VIII hereof; provided
that at the time of its creation such trust does not violate the Senior Credit
Facility and (iii) payments from the Collateral Account or otherwise from funds
released to the Company or the Trustee from escrow under the Escrow Agreement
for payment of the Special Redemption Price as described in Section 3.10 hereof
provided that such payments are limited in the aggregate to the Special
Redemption Amount,
SECTION 10.03 Default on Designated Senior Debt.
The Company may not make any payment upon or in respect of the Notes
(other than (i) Permitted Junior Securities, (ii) payments and other
distributions made from any trust created pursuant to Article VIII hereof;
provided that at the time of its creation such trust does not violate the Senior
Credit Facility and (iii) payments from the Collateral Account or otherwise from
funds released to the Company or the Trustee from escrow under the Escrow
Agreement for payment of the Special Redemption Price as described in Section
3.10 hereof) if:
(a) a default in the payment, when due, of the principal of, premium,
if any, or interest on Designated Senior Debt occurs and is continuing beyond
any applicable grace period in the agreement, indenture or other document
governing such Designated Senior Debt; or
(b) a default, other than a payment default pursuant to the preceding
clause (a), on Designated Senior Debt occurs and is continuing that then permits
holders of the Designated Senior Debt as to which such default relates to
accelerate its maturity without further notice or the expiration of any
applicable grace periods (a "Nonpayment Default") and the Trustee receives (and
the Company receives, if not sent by the Company) a notice of the default (a
"Payment Blockage Notice") from a Person who may give it pursuant to Section
10.09 hereof, which notice states it is a Payment Blockage Notice under this
Indenture and that is submitted by such Person to evidence its election to
effect a payment blockage for the period specified in the next following
paragraph.
The Company may and shall resume payments on and distributions in
respect of the Notes:
(i) in the case of a payment default pursuant to clause
(a) of this Section 10.03, the date on which the default is cured or
waived or any acceleration if rescinded, as applicable, and
(ii) in the case of a Nonpayment Default, the earlier of
(a) the date on which such Nonpayment Default is cured or waived or
(b) 179 days after the date on which
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the applicable Payment Blockage Notice is received, unless the maturity
of such Designated Senior Debt has been accelerated and not thereafter
rescinded, provided, in each case, the Company may pay the Notes without
regard to the foregoing if it and the Trustee receive written notice
approving the same from Representatives of each Designated Senior Debt.
If the Trustee receives any such Payment Blockage Notice, no subsequent
Payment Blockage Notice shall commence or be effective for purposes of this
Section unless and until (i) 360 days shall have elapsed since the effectiveness
of the immediately prior Payment Blockage Notice and (ii) all scheduled payments
of principal of, and, premium, if any, and interest and Liquidated Damages, if
any, on, the Notes that have come due have been paid in full in cash. No
Nonpayment Default that existed or was continuing on the date of delivery of any
Payment Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice unless such default shall have been cured or
waived for a period of not less than 90 days.
SECTION 10.04 Acceleration of Notes.
If payment of the Notes is accelerated because of an Event of Default,
the Company shall promptly notify holders of Senior Debt of the acceleration.
SECTION 10.05 Notice by Company.
The Company shall promptly notify the Trustee and the Paying Agent of any
facts known to the Company that would cause a payment of any Obligations with
respect to the Notes to violate this Article X, but failure to give such notice
shall not affect the subordination of the Notes to the Senior Debt as provided
in this Article X.
SECTION 10.06 Subrogation.
After all Senior Debt is paid in full in cash and until the Notes are
paid in full, Holders of Notes shall be subrogated to the rights of holders of
Senior Debt or holders of debt of the Company which is pari passu with the Notes
but not expressly subordinated to Senior Debt to receive distributions
applicable to Senior Debt to the extent that distributions otherwise payable to
the Holders of Notes have been applied to the payment of Senior Debt. A
distribution made under this Article X to holders of Senior Debt that otherwise
would have been made to Holders of Notes is not, as between the Company and
Holders, a payment by the Company on the Notes.
SECTION 10.07 Relative Rights.
This Article X defines the relative rights of Holders of Notes and
holders of Senior Debt. Nothing in this Indenture shall:
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(a) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay principal
of, premium, if any and interest and Liquidated Damages, if any, on, the Notes
in accordance with their terms;
(b) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of Senior Debt; or
(c) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Debt to receive distributions and payments
otherwise payable to Holders of Notes.
If the Company fails because of this Article X to pay principal of or
interest and Liquidated Damages, if any, on a Note on the due date, the failure
after any applicable grace period has elapsed is still a Default or Event of
Default.
SECTION 10.08 Subordination May Not Be Impaired by Company.
No right of any holder of Senior Debt to enforce the subordination of the
Indebtedness evidenced by the Notes shall be impaired by any act or failure to
act by the Company or any Holder or by the failure of the Company or any Holder
to comply with this Indenture.
SECTION 10.09 Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to holders of any
Senior Debt, the distribution may be made and the notice given to the
Representative of such Senior Debt.
Upon any payment or distribution of assets of the Company referred to in
this Article X, the Trustee and the Holders of Notes shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction or upon any
certificate of such Representative or of the liquidating trustee or agent or
other Person making any distribution to the Trustee or to the Holders of Notes
for the purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of the Senior Debt and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article X.
SECTION 10.10 Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article X or any other provision
of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes, unless a Responsible Officer of the Trustee shall
have received at its Corporate Trust Office at least five Business Days prior to
the date of such payment
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written notice of facts that would cause the payment of any Obligations with
respect to the Notes to violate this Article X. Only the Company or a
Representative of the holders of any Designated Senior Debt may give the
notice. Nothing in this Article X shall impair the claims of, or payments to,
the Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior Debt
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights.
SECTION 10.11 Authorization to Effect Subordination.
Each Holder of Notes, by the Holder's acceptance thereof, authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article X, and appoints the Trustee to act as such Holder's attorney-in-fact for
any and all such purposes. If the Trustee does not file a proper proof of claim
or proof of debt in the form required in any proceeding referred to in Section
6.09 hereof at least 30 days before the expiration of the time to file such
claim, any Representative is hereby authorized to file an appropriate claim for
and on behalf of the Holders of the Notes.
SECTION 10.12 Amendments.
The provisions of this Article X shall not be amended or modified without
the written consent of the respective Representatives under the Senior Credit
Facility and all other Designated Senior Debt.
SECTION 10.13 Continued Effectiveness.
The terms of this Indenture, the subordination effected hereby, and the
rights and other obligations of the Holders of the Notes of the holders of
Senior Debt arising hereunder, shall not be affected, modified or impaired in
any manner or to any extent by: (i) any amendment or modification of or
supplement to any Credit Facility (to the extent not prohibited by this
Indenture); (ii) the validity and enforceability of any of such documents; or
(iii) any exercise or non-exercise of any right, power or remedy under or in
respect of the Senior Debt or the Obligations evidenced by the Notes or any of
the instruments or documents referred to in clause (i) above. Each Holder of
Notes hereby acknowledges that the provisions of this Indenture are intended to
be enforceable at all times, whether before the commencement of, in connection
with or premised on the occurrence of any voluntary or involuntary insolvency,
bankruptcy, receivership, custodianship, liquidation, dissolution,
reorganization, assignment for the benefit of creditors, appointment of a
custodian, receiver, trustee or other officer with similar powers or any other
proceeding for the liquidation, dissolution or other winding up of the Company
or any Guarantor (including, without limitation, any such proceeding under the
Bankruptcy Code).
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SECTION 10.14 Cumulative Rights; No Waivers.
Subject to Section 10.03 hereof, each and every right, remedy and power
granted to any Representative of any Senior Debt hereunder shall be cumulative
and in addition to any other right, remedy or power specifically granted herein,
in the related Senior Debt or now or hereafter existing in equity, at law, by
virtue of statute or otherwise, and may be exercised by any Representative of
any Senior Debt or the holders of any Senior Debt, from time to time,
concurrently or independently and as often and in such order as such any
Representative or the holders of Senior Debt may deem expedient (subject to the
limits provided in Section 10.03 hereof with respect to payment blockages). Any
failure or delay on the part of any Representative of Senior Debt or the holders
of Senior Debt in exercising any such right, remedy or power, or abandonment or
discontinuance of steps to enforce the same, shall not operate as a waiver
thereof or affect the rights of such any Representative or the holders of Senior
Debt thereafter to exercise the same, and any single or partial exercise of any
such right, remedy or power shall not preclude any other or further exercise
thereof or the exercise of any other right, remedy or power, and no such
failure, delay, abandonment or single or partial exercise of the rights of any
Representative of Senior Debt or the holders of Senior Debt hereunder shall be
deemed to establish a custom or course of dealing or performance among the
parties hereto.
SECTION 10.15 Trustee.
Any Representative of Senior Debt shall be entitled to send any notices
required or permitted to be delivered to the Holders of the Notes to the Trustee
on behalf of such holders and any such notice so delivered to the Trustee shall
be deemed to have been delivered to all Holders of Notes.
ARTICLE XI
GUARANTEES
SECTION 11.01 Subsidiary Guarantees.
Subject to Section 11.05 hereof, each of the Guarantors hereby jointly
and severally, unconditionally guarantees, and each Person who in the future
becomes a Guarantor by executing a supplemental indenture in the form attached
to this Indenture as Exhibit E shall jointly and severally, unconditionally
guarantee, on a senior subordinated basis to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
the Notes and the Obligations of the Company hereunder and thereunder, that:
(a) the principal of, and premium, if any, interest and Liquidated
Damages, if any, on, the Notes will be promptly paid in full when due, subject
to any applicable grace period, whether at maturity, by acceleration, redemption
or otherwise, and interest on the overdue principal of, and premium, if any, (to
the extent permitted by law) interest and Liquidated Damages, if any, on, the
Notes, and all other payment Obligations of the Company to the Holders or the
Trustee hereunder
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or thereunder will be promptly paid in full and performed, all in accordance
with the terms hereof and thereof; and
(b) in case of any extension of time of payment or renewal of any
Notes or any of such other Obligations, the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal,
subject to any applicable grace period, whether at stated maturity, by
acceleration, redemption or otherwise.
Failing payment when so due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors will be jointly
and severally obligated to pay the same immediately. An Event of Default under
this Indenture or the Notes shall constitute an event of default under the
Subsidiary Guarantees, and shall entitle the Holders to accelerate the
Obligations of the Guarantors hereunder and under the Notes in the same manner
and to the same extent as the Obligations of the Company hereunder and under the
Notes. The Guarantors hereby agree that their Obligations hereunder shall be
unconditional, irrespective of the validity or enforceability of the Notes or
this Indenture, the absence of any action to enforce the same, any waiver or
consent by any Holder with respect to any provisions hereof or thereof, the
recovery of any judgment against the Company, any action to enforce the same or
any other circumstance (other than complete performance) which might otherwise
constitute a legal or equitable discharge or defense of a Guarantor. Each
Guarantor, to the extent permitted by law, hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenants that its
Subsidiary Guarantee will not be discharged except by complete performance of
the Obligations contained in the Notes and this Indenture. If any Holder or the
Trustee is required by any court or otherwise to return to the Company, the
Guarantors, or any Note Custodian, Trustee, liquidator or other similar official
acting in relation to either the Company or the Guarantors, any amount paid by
the Company or any Guarantor to the Trustee or such Holder, this Subsidiary
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Guarantor agrees that it shall not be entitled to, and
hereby waives, any right to exercise any right of subrogation in relation to the
Holders in respect of any Obligations guaranteed hereby, except as provided
under Section 11.05 hereof. Each Guarantor further agrees that, as between the
Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the Obligations guaranteed hereby may be accelerated as
provided in Article VI hereof for the purposes of its Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed thereby, and (y) in the
event of any declaration of acceleration of such Obligations as provided in
Article VI hereof, such Obligations (whether or not due and payable) shall
forthwith become due and payable by each Guarantor for the purpose of its
Subsidiary Guarantee. The Guarantors shall have the right to seek contribution
from any non-paying Guarantor pursuant to Section 11.05 hereof after the Notes
and the Obligations hereunder shall have been paid in full to the Holders under
the Subsidiary Guarantees.
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SECTION 11.02 Execution and Delivery of Additional Subsidiary Guarantee or
Supplemental Indenture; Notation of Subsidiary Guarantee.
To effect any additional Subsidiary Guarantee set forth in Section 11.01
hereof, any future Guarantor shall execute and deliver a supplemental indenture
substantially in the form of Exhibit E hereto, which supplemental indenture
shall be entered into in accordance with Section 4.18 hereof and shall be
executed on behalf of such Guarantor, by manual or facsimile signature, by an
Officer of such Guarantor.
To evidence its Subsidiary Guarantee set forth in Section 11.01 hereof,
each Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form set forth on Exhibits A-1 and A-2 hereof shall be
endorsed by manual or facsimile signature of an Officer of such Guarantor or of
the Company as attorney-in fact for such Guarantor on each Note authenticated
and delivered by the Trustee, and that this Indenture shall be executed on
behalf of such Guarantor, by manual or facsimile signature, by an Officer of
such Guarantor. For so long as a Subsidiary Guarantee of such Guarantor remains
in full force and effect, each Guarantor hereby irrevocably appoints the Company
as its attorney-in-fact for the purpose of executing in the name and on behalf
of such Guarantor any endorsement of a notation of a Subsidiary Guarantee on any
Note. If an Officer of the Company whose signature is on this Indenture or on
the Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
Each Guarantor hereby agrees that its Subsidiary Guarantee set forth in
Section 11.01 hereof shall remain in full force and effect notwithstanding any
failure to endorse on each or any Note a notation of such Subsidiary Guarantee.
The delivery of any 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 Guarantors.
For so long as a Subsidiary Guarantee of such Guarantor remains in full
force and effect, each Guarantor hereby irrevocably appoints the Company as its
attorney-in-fact for the purpose of executing in the name and on behalf of such
Guarantor any supplemental indenture to this Indenture, or consent to any such
supplemental indenture, which the Company and the Trustee are authorized to
enter into pursuant to Sections 9.01 or 9.02 of this Indenture.
SECTION 11.03 Guarantors May Consolidate, Etc., on Certain Terms.
(a) Except as set forth in Articles IV and V hereof, nothing
contained in this Indenture shall prohibit a merger between a Guarantor and
another Guarantor or a merger between a Guarantor and the Company.
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(b) No Guarantor shall consolidate with or merge with or into
(whether or not such Guarantor is the surviving Person), another Person whether
or not affiliated with such Guarantor unless (i) the Person formed by or
surviving any such consolidation or merger (if other than such Guarantor)
assumes all the Obligations of such Guarantor, pursuant to a supplemental
indenture substantially in the form of Exhibit E hereto, under this Indenture;
(ii) immediately after giving effect to such transaction, no Default or Event of
Default exists; (iii) such Guarantor, or any Person formed by or surviving any
such consolidation or merger, would have Consolidated Net Worth (immediately
after giving effect to such transaction) equal to or greater than the
Consolidated Net Worth of such Guarantor immediately preceding the transaction;
and (iv) except in the case of the merger of a Guarantor with or into another
Guarantor or the Company, the Company would be permitted by virtue of the
Company's pro forma Fixed Charge Coverage Ratio, immediately after giving effect
to such transaction, to incur at least $1.00 of additional Indebtedness pursuant
to the Fixed Charge Coverage Ratio test set forth in the first paragraph of
Section 4.09 hereof.
Notwithstanding the foregoing paragraph (and in the case of clause (iii)
of this paragraph, notwithstanding Section 11.03(c) hereof), (i) any Guarantor
may consolidate with, merge into or transfer all or a part of its properties and
assets to the Company or any other Guarantor, (ii) any Guarantor may consolidate
with merge into or transfer all or a part of its properties and assets to a
Wholly Owned Restricted Subsidiary of the Company that has no significant assets
or liabilities and was incorporated, organized or formed solely for the purpose
of reincorporating or otherwise reorganizing such Guarantor in another State of
the United States; provided that, in each case, such successor, resultant or
transferee Person continues to be a Guarantor and (iii) subject to the
provisions of Section 11.04, upon the occurrence of one or more of the
transactions provided for in the preceding paragraph, a Guarantor shall be
released from its obligations under its Subsidiary Guarantee and otherwise under
this Indenture, and any related resultant, surviving or transferee Person shall
not be required to assume any of such obligations.
(c) In the case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and substantially in the form of Exhibit E
hereto, of the Subsidiary Guarantee endorsed upon the Notes and the due and
punctual performance of all of the covenants and conditions of this Indenture to
be performed by the Guarantor, such successor Person shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All of the Subsidiary Guarantees so issued shall
in all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees 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.
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SECTION 11.04 Releases Following Release Under All Indebtedness or Sale of
Assets.
Upon (x) the release by the lenders of all guarantees of a Guarantor
guaranteeing, and all Liens on the property and assets of such Guarantor
securing, Indebtedness of the Company, or (y) a sale or other disposition,
whether in one or a series of related transactions, of all or substantially all
of the assets of any Guarantor, by way of merger, consolidation or otherwise, or
a sale or other disposition, whether in one or a series of related transactions,
of all of the Capital Stock of any Guarantor in compliance with the Indenture to
any entity that is not the Company or a Subsidiary, then such Guarantor and such
acquiring, resulting, surviving or transferee Person will be released and
relieved of any obligations under any Subsidiary Guarantee; provided, however,
that any such termination shall occur only to the extent that all obligations of
such Guarantor under such Indebtedness and all of its guarantees of, and under
all of its pledges of assets or other security interests which secure,
Indebtedness of the Company shall also terminate upon such release, sale or
transfer and, in the event of any sale or other disposition, delivery of an
Officers' Certificate to the Trustee that the Net Proceeds of such sale or other
disposition will be applied in accordance with Section 4.10 hereof. Upon
delivery by the Company to the Trustee of an Officers' Certificate to the effect
of the foregoing, the Trustee shall execute any documents reasonably required in
order to evidence the release of any Guarantor from its Obligation under its
Subsidiary Guarantee and this Indenture. Any Guarantor not released from its
Obligations under its Subsidiary Guarantee shall remain liable for the full
amount of principal of, and premium, if any, interest and Liquidated Damages, if
any, on the Notes and for the other Obligations of such Guarantor under this
Indenture as provided in this Article XI.
SECTION 11.05 Limitation on Guarantor Liability; Contribution.
For purposes hereof, each Guarantor's liability under its Subsidiary
Guarantee shall be limited to the lesser of (i) the aggregate amount of the
Obligations of the Company under the Notes and this Indenture and (ii) the
amount, if any, which would not have (A) rendered such Guarantor "insolvent" (as
such term is defined in the Bankruptcy Code and in the Debtor and Creditor Law
of the State of New York) or (B) left such Guarantor with unreasonably small
capital at the time its Subsidiary Guarantee of the Notes was entered into;
provided that, it will be a presumption in any lawsuit or other proceeding in
which a Guarantor is a party that the amount guaranteed pursuant to its
Subsidiary Guarantee is the amount set forth in clause (i) above unless any
creditor, or representative of creditors of such Guarantor, or debtor in
possession or trustee in bankruptcy of such Guarantor, otherwise proves in such
a lawsuit that the aggregate liability of such Guarantor is the amount set forth
in clause (ii) above. In making any determination as to solvency or sufficiency
of capital of a Guarantor in accordance with the previous sentence, the right of
such Guarantor to contribution from other Guarantors as set forth below, and any
other rights such Guarantor may have, contractual or otherwise, shall be taken
into account.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors shall agree, inter se, that in the event any payment
or distribution is made by any Guarantor (a "Funding Guarantor") under its
Subsidiary Guarantee, such Funding Guarantor shall be entitled to
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a contribution from all other Guarantors in a pro rata amount based on the
Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in
discharging the Company's obligations with respect to the Notes or any other
Guarantor's Obligations with respect to its Subsidiary Guarantee.
SECTION 11.06 Trustee to Include Paying Agent.
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article XI shall in each 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 XI in place of the Trustee.
SECTION 11.07 Subordination of Subsidiary Guarantee.
The obligations of each Guarantor under its Subsidiary Guarantee pursuant
to this Article XI shall be subordinated to the prior payment in full of all
Senior Debt of such Guarantor, and the amounts for which the Guarantors will be
liable under the guarantees issued from time to time with respect to Senior
Debt, to the same extent as the obligations of the Company with respect to the
Notes are subordinated to Senior Debt of the Company. For the purposes of the
foregoing sentence, the Trustee and the Holders of Notes shall have the right to
receive or retain payments by any of the Guarantors only at such times as they
may receive or retain payments in respect of the Notes pursuant to this
Indenture, including Article X hereof.
Each Holder of a Note by its acceptance thereof (a) agrees to and shall
be bound by the provisions of this Section 11.07, (b) authorizes and directs the
Trustee on its behalf to take such action as may be necessary or appropriate to
effectuate the subordination so provided and (c) appoints the Trustee its
attorney-in-fact for any and all such purposes. Consistent with the
subordination of the Subsidiary Guarantees, for purposes of any applicable
fraudulent transfer or similar laws, Indebtedness incurred under any Credit
Facility will be deemed to have been incurred prior to the incurrence by any
Guarantor of its liability under its Subsidiary Guarantee.
ARTICLE XII
MISCELLANEOUS
SECTION 12.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), the imposed duties shall control.
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SECTION 12.02 Notices.
Any notice or communication by the Company, any 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), telecopier
or overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company or any Guarantor:
Tesoro Petroleum Corporation
8700 Tesoro Drive
San Antonio, Texas 78217-6218
Attention: Corporate Secretary
If to the Trustee:
U.S. Bank Trust National Association
535 Griswold, Suite 740
Detroit, Michigan 48226
Fax No.: 313-963-9428
Attention: Corporate Trust Administration
Ref: Tesoro Petroleum Corporation
The Company, any 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; 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.
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 Section 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.
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If the Company mails a notice or communication to Holders, it shall mail
a copy to the Trustee and each Agent at the same time.
SECTION 12.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
SECTION 12.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 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 12.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
SECTION 12.05 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 Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has been
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
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SECTION 12.06 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 12.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No past, present or future director, officer, employee, incorporator,
partner, member or stockholder or other owner of Capital Stock of the Company or
any of its Subsidiaries, or of any member, partner or stockholder of any such
entity, as such, shall have any liability for any obligations of the Company or
any Guarantor under the Notes, this Indenture or the Subsidiary Guarantees or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the Notes.
SECTION 12.08 Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF, SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE,
THE NOTES AND THE SUBSIDIARY GUARANTEES.
SECTION 12.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 12.10 Successors.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 12.11 Severability.
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
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SECTION 12.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture, and each
party hereto may sign any number of separate copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
SECTION 12.13 Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
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SIGNATURES
Dated as of July 2, 1998
ISSUER:
TESORO PETROLEUM CORPORATION
By: /s/ James C. Reed, Jr.
------------------------------------
James C. Reed, Jr.
Executive Vice President
TRUSTEE:
U. S. BANK TRUST NATIONAL ASSOCIATION
By: /s/ James D. Khami
------------------------------------
Name: James D. Khami
-----------------------------
Title: Vice President
--------------------------
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GUARANTORS:
DIGICOMP, INC.
INTERIOR FUELS COMPANY
KENAI PIPE LINE COMPANY
TESORO ALASKA PETROLEUM COMPANY
TESORO ALASKA PIPELINE COMPANY
TESORO BOLIVIA PETROLEUM COMPANY
TESORO EXPLORATION AND
PRODUCTION COMPANY
TESORO HAWAII CORPORATION
TESORO LATIN AMERICA COMPANY
TESORO MARINE SERVICES HOLDING COMPANY
TESORO MARINE SERVICES, INC.
TESORO NATURAL GAS COMPANY
TESORO NORTHSTORE COMPANY
TESORO PETROLEUM COMPANIES, INC.
TESORO REFINING, MARKETING &
SUPPLY COMPANY
TESORO SOUTH PACIFIC PETROLEUM
COMPANY
TESORO VOSTOK COMPANY
By: /s/ James C. Reed, Jr.
----------------------------------
James C. Reed, Jr.
Executive Vice President of each of
the above entities
TESORO E&P COMPANY, L.P.
By: Tesoro Exploration and Production
Company
as General Partner
By: /s/ James C. Reed, Jr.
----------------------------------
James C. Reed, Jr.
Executive Vice President
TESORO PIPELINE COMPANY, L.P.
By: Tesoro Natural Gas Company
as General Partner
By: /s/ James C. Reed, Jr.
----------------------------------
James C. Reed, Jr.
Executive Vice President
113
GUARANTORS (CONT'D):
TESORO FINANCIAL SERVICES HOLDING
COMPANY
TESORO GAS RESOURCES COMPANY, INC.
By: /s/ Jeffrey B. Fabian
----------------------------------
Jeffrey B. Fabian
President
VICTORY FINANCE COMPANY
By: /s/ Jeffrey B. Fabian
----------------------------------
Jeffrey B. Fabian
Secretary
114
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL
ACCREDITED INVESTOR
Exhibit E FORM OF SUPPLEMENTAL INDENTURE
Exhibit F REGISTRATION RIGHTS AGREEMENT
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EXHIBIT A-1
(FACE OF NOTE)
CUSIP/CINS
---------
9% Senior Subordinated Notes due 2008[, Series B]*
No. $
----- ---------
TESORO PETROLEUM CORPORATION
promises to pay to
or registered assigns,
the principal sum of
Dollars on July 1, 2008.
Interest Payment Dates: January 1 and July 1
Record Dates: December 15 and June 15
TESORO PETROLEUM CORPORATION
By:
----------------------------------
Name:
Title:
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
U. S. BANK TRUST NATIONAL ASSOCIATION
AS TRUSTEE
By: Dated:
----------------------------------
Authorized Signatory
* Include if the Note represents an Exchange Note.
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(Back of Note)
9% Senior Subordinated Notes due 2008[, Series B]*
[Insert the Global Note Legend, if applicable,
pursuant to the provisions of the Indenture]
[Insert the Private Placement Legend, if applicable,
pursuant to the provisions of the Indenture]
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Tesoro Petroleum Corporation, a Delaware
corporation (the "Company"), promises to pay interest on the principal amount
of this Note at 9% per annum, from July 2, 1998 until maturity and shall pay
the Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages, if any, semi-annually in arrears on January 1 and July 1 of each year,
or if any such day is not a Business Day, on the next succeeding Business Day
(each an "Interest Payment Date"). Interest on the Notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from the date of original issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated between a
record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest Payment
Date, except in the case of the original issuance of Notes, in which case
interest shall accrue from date of authentication; provided, further, that the
first Interest Payment Date shall be January 1, 1999. The Company shall pay
interest (including postpetition interest in any proceeding under the
Bankruptcy Code) on overdue principal and premium, if any, from time to time on
demand at the rate borne on the Notes; it shall pay interest (including
post-petition interest in any proceeding under the Bankruptcy Code) on overdue
installments of interest and Liquidated Damages, if any, (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the December 15 or June
15 next preceding the Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
The Notes will be payable as to principal, premium and Liquidated Damages, if
any, and interest at the office or agency of the Company maintained for such
purpose within the City and State of New York, or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of immediately available funds will be
required with respect to principal of, and interest, premium and Liquidated
Damages on, all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
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3. Paying Agent and Registrar. Initially, U.S. Bank Trust
National Association, the Trustee under the Indenture, will act as Paying Agent
and Registrar. The Company may change any Paying Agent or Registrar without
notice to any Holder. The Company or any of its Subsidiaries may act in any
such capacity.
4. Indenture; Subordination. The Company issued the Notes under
an Indenture dated as of July 2, 1998 ("Indenture") between the Company, the
Guarantors and the Trustee, as the same may be amended, modified or
supplemented from time to time. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. To the extent any provision of
this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling. The Notes are
general unsecured obligations of the Company limited to $300,000,000 aggregate
principal amount in the case of Notes issued on the Issue Date.
The Notes are subordinated in right of payment, in the manner and to
the extent set forth in the Indenture, to the prior payment in full in cash of
all Senior Debt of the Company, whether outstanding on the date of the
Indenture or thereafter created, incurred, assumed or guaranteed. The
Subsidiary Guarantees in respect of the Notes will be subordinated in right of
payment, in the manner and to the extent set forth in the Indenture, to the
prior payment in full in cash of all Senior Debt of each Guarantor, whether
outstanding on the date of the Indenture or thereafter created, incurred
assumed or guaranteed. Each Holder by its acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on its
behalf, to take such action as may be necessary or appropriate to effectuate
the subordination provided for in the Indenture and appoints the Trustee its
attorney-in-fact for such purposes.
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this
paragraph 5 and paragraph 8 below, the Notes shall not be redeemable at the
Company's option prior to July 1, 2003. Thereafter, the Notes will be subject
to redemption at any time or from time to time at the option of the Company, in
whole or in part, at the redemption prices (expressed as percentages of
principal amount) set forth below plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, to the applicable redemption date, if
redeemed during the twelve-month period beginning on July 1 of the years
indicated below:
YEAR PERCENTAGE
---- ----------
2003 ......................... 104.5%
2004 ......................... 103.0%
2005 ......................... 101.5%
2006 and thereafter............ 100.0%
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(b) Notwithstanding the foregoing, at any time or from time
to time prior to July 1, 2001, the Company may on any one or more occasions
redeem up to 35% of the aggregate principal amount of Notes outstanding at a
redemption price of 109% of the principal amount thereof, plus accrued and
unpaid interest, if any, and Liquidated Damages thereon, if any, to the
redemption date, with the net cash proceeds of any one or more Public Equity
Offerings; provided that at least 65% of the aggregate principal amount of Notes
outstanding on the Issue Date remain outstanding immediately after each
occurrence of such redemption; and provided, further, that each such redemption
shall occur within 90 days of the date of the closing of such Public Equity
Offering.
6. Mandatory Redemption. Except as set forth in paragraph 8
below, the Company shall not be required to make mandatory redemption payments
with respect to the Notes.
7. Repurchase at Option of Holder.
(a) Upon the occurrence of a Change of Control, each
Holder of Notes will have the right to require the Company to repurchase all or
any part (equal to $1,000 or an integral multiple thereof) of such Holder's
Notes pursuant to a Change of Control Offer described in the Indenture 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, thereon to the
date of purchase (the "Change of Control Payment"). Within 30 days following
any Change of Control, the Company shall mail a notice to each Holder setting
forth the procedures governing the Change of Control Offer as required by the
Indenture.
(b) If the Company or a Restricted Subsidiary consummates
any Asset Sales and the aggregate amount of Excess Proceeds exceeds
$10,000,000, the Company shall commence an offer to all Holders of Notes (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture (pro rata in
proportion to outstanding Indebtedness that is pari passu with the Notes that
require asset sales offers) to purchase the maximum principal amount of 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 and unpaid
interest and Liquidated Damages thereon, if any, to the date of purchase, in
accordance with the procedures set forth in the Indenture. To the extent that
the aggregate amount of Notes tendered pursuant to an Asset Sale Offer is less
than the Excess Proceeds, the Company (or such Restricted Subsidiary) may use
such deficiency for general corporate purposes. If the aggregate principal
amount of Notes surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes to be purchased on a pro rata
basis. Holders of Notes that are the subject of an offer to purchase will
receive an Asset Sale Offer from the Company prior to any related purchase date
and may elect to have such Notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes.
8. Special Redemption. If the Washington Acquisition is not
consummated by the Company, or the Washington Agreement is terminated without
consummation of the Washington Acquisition, on or prior to December 31, 1998,
the Company shall redeem outstanding Notes in an amount equal to 50% of the
aggregate principal amount of the Original Notes at a redemption price equal to
101% of the redeemed principal amount thereof (the "Special Redemption Price"),
plus accrued interest and Liquidated Damages, if any, to the date of
redemption. The date for such redemption (the "Special Redemption Date") shall
be the earlier of December 31, 1998 and ten
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business days following the date of termination of the Washington Agreement
without consummation of the Washington Acquisition. Selection of Notes for
special redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which
the Notes are listed, or, if the Notes are not so listed, on a pro rata basis,
or by such method (other than by lot) as the Trustee shall deem fair and
appropriate; provided that no Notes of $1,000 or less shall be redeemed in
part. Notice of the Special Redemption to the Trustee and the Holders shall be
made in accordance with Sections 3.01 and 3.03 of the Indenture.
9. Notice of Redemption. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date (other than
in connection with a Special Redemption) to each Holder whose Notes are to be
redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part but only in whole multiples of $1,000, unless all of
the Notes held by a Holder are to be redeemed. On and after the redemption
date, interest and Liquidated Damages, if any, cease to accrue on Notes or
portions thereof called for redemption.
10. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture. The Company need not
exchange or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part. Also, it need not exchange or register the transfer of any Notes for a
period of 15 days before a selection of Notes to be redeemed or during the
period between a record date and the corresponding Interest Payment Date.
11. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
12. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes, and any existing default or compliance with any provision of
the Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes or to
alter the provisions of Article II of the Indenture (including the related
definitions) in a manner that does not materially adversely affect any Holder,
to provide for the assumption of the Company's obligations to Holders of the
Notes in case of a merger, consolidation or sale of assets pursuant to Article
V of the Indenture or to add any Person as a Guarantor or to release any
Guarantor or otherwise comply with Article XI of the Indenture, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the
Indenture of any such Holder, or to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the TIA.
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13. Defaults and Remedies. Events of Default include: (a) default
in the payment when due of interest on, or Liquidated Damages, if any, with
respect to, the Notes and such default continues for a period of 30 days; (b)
default in the payment when due of principal of, or premium, if any, on, the
Notes; (c) failure by the Company to comply with any of the provisions of
Section 5.01 of the Indenture; (d) failure by the Company or any of its
Restricted Subsidiaries to comply with any of the provisions of Section 3.10,
4.10 or 4.15 of the Indenture; (e) failure by the Company or any of its
Restricted Subsidiaries to observe or perform any other covenant or other
agreement in the Indenture or the Notes for 60 days after written notice to the
Company by the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding; (f) a default occurs under any mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any Indebtedness for money borrowed by the Company or
any of its Restricted Subsidiaries (or the payment of which is guaranteed by
the Company or any of its Restricted Subsidiaries), whether such Indebtedness
or guarantee now exists, or is created after the Issue Date, 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 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 without duplication
$15,000,000 or more, and such default shall not have been cured or waived or
any such acceleration rescinded within 10 Business Days after the running of
such grace period or the occurrence of such acceleration; (g) a final judgment
or final judgments for the payment of money are entered by a court or courts of
competent jurisdiction against the Company or any of its Restricted
Subsidiaries, and such judgment or judgments remain unpaid, unstayed or
undischarged for a period (during which execution shall not be effectively
stayed) of 60 days, provided that the aggregate of all such unpaid or
undischarged judgments exceeds $15,000,000 (excluding amounts covered by
insurance); (h) certain events of bankruptcy or insolvency with respect to the
Company or any of its Subsidiaries that, when taken together, would constitute
a Significant Subsidiary or any of its Significant Subsidiaries; or (i) except
as permitted in the Indenture, any 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 any Guarantor, or any Person acting on
behalf of any Guarantor, shall deny or disaffirm its obligations under its
Subsidiary Guarantee (other than by reason of termination of the Indenture or
the release of such Subsidiary Guarantee in accordance with the Indenture). 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 Notes may declare all the
Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of the Notes notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal or
interest) if it determines that withholding notice is in their interest. The
Holders of a majority in aggregate principal amount of the Notes then
outstanding by notice to the Trustee may on behalf of the Holders of all of the
Notes waive any existing Default or Event of Default and its consequences under
the Indenture except a continuing Default or Event of Default in the payment of
interest on, or the principal of, the Notes. The Company is required to
deliver to
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the Trustee annually a statement regarding compliance with the Indenture, and
the Company is 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.
14. Trustee Dealings with Company. The Trustee, in its individual
or any other capacity, may make loans to, accept deposits from, and perform
services for, the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
15. No Recourse Against Others. A director, officer, employee,
incorporator, partner, member or stockholder of the Company or any Subsidiary
of the Company or any Guarantor, as such, shall not have any liability for any
obligations of the Company or Guarantors under the Notes, the Subsidiary
Guarantees or 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 Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
16. Authentication. This Note shall not be valid until
authenticated by the manual signature of a Responsible Officer of the Trustee
or an authenticating agent.
17. Abbreviations. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
18. Additional Rights of Holders of Restricted Global Notes and
Restricted Definitive Notes. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement dated as of [July 2, 1998] [bracketed date to be included on Original
Notes, all other Notes should reference date of any corresponding Registration
Rights Agreement], between the Company and the parties named on the signature
pages thereof (the "Registration Rights Agreement").
19. CUSIP Numbers. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to: Tesoro Petroleum Corporation, 8700 Tesoro
Drive, San Antonio, Texas 78217-6218, Attention: Vice President, Finance and
Treasurer.
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NOTATION OF SUBSIDIARY GUARANTEES
Payment of principal of, and premium, if any, interest and Liquidated
Damages, if any, on, this Note is jointly, severally, and unconditionally
guaranteed on a senior subordinated basis to the extent and in the manner set
forth in the Indenture by the Guarantors who have become parties to the
Indenture, including the Guarantors duly endorsing this notation. Subsidiary
Guarantees are subject to release under circumstances set forth in the
Indenture.
[Insert Names of Guarantors]
BY TESORO PETROLEUM CORPORATION
Attorney in fact for each of the
Guarantors
By:
----------------------------------
Name/Title:
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ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
---------------------------------------------------------
- --------------------------------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
- --------------------------------------------------------------------------------
Date:
Your Signature:
-----------------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
SIGNATURE GUARANTEE
- --------------------------------------------------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting the
requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other
"signature guarantee program" as may be
determined by the Registrar in addition to,
or in substitution for, STAMP, all in
accordance with the Securities Exchange Act
of 1934, as amended.
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$
-----------------
Date:
Your Signature:
----------------------------------------------------------------
(Sign exactly as your name appears on the face of the Note)
Tax Identification No.:
-------------------------------------------------------
SIGNATURE GUARANTEE
- --------------------------------------------------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting the
requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other
"signature guarantee program" as may be
determined by the Registrar in addition to,
or in substitution for, STAMP, all in
accordance with the Securities Exchange Act
of 1934, as amended.
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE***
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note,
have been made:
PRINCIPAL AMOUNT OF SIGNATURE OF
AMOUNT OF AMOUNT OF OF THIS GLOBAL NOTE AUTHORIZED
DECREASE IN INCREASE IN FOLLOWING SUCH SIGNATORY OF
PRINCIPAL AMOUNT PRINCIPAL AMOUNT DECREASE (OR TRUSTEE OR NOTE
DATE OF EXCHANGE OF THIS GLOBAL NOTE OF THIS GLOBAL NOTE INCREASE) CUSTODIAN
---------------- ------------------- ------------------- ------------------ ---------------
- -------------------
*** This should be included only if the Note is issued in global form.
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EXHIBIT A-2
(FACE OF REGULATION S TEMPORARY GLOBAL NOTE)
CUSIP/CINS:
---------
9% Senior Subordinated Notes due 2008*
No. $
----- ---------
TESORO PETROLEUM CORPORATION
promises to pay to
or registered assigns,
the principal sum of
Dollars on July 1, 2008.
Interest Payment Dates: January 1 and July 1
Record Dates: December 15 and June 15.
TESORO PETROLEUM CORPORATION
By:
----------------------------------
Name:
Title:
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
U. S. BANK TRUST NATIONAL ASSOCIATION
AS TRUSTEE
By: Dated:
----------------------------------
Authorized Signatory
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(BACK OF REGULATION S TEMPORARY GLOBAL NOTE)
9% SENIOR SUBORDINATED NOTES DUE 2008
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO ARTICLE II OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF TESORO PETROLEUM CORPORATION.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
(AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE), TO THE COMPANY OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY), 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.
THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES
(1) NOT TO OFFER, SELL OR
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OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO (X) THE DATE THAT IS TWO YEARS (OR
SUCH SHORTER PERIOD OF TIME AS PERMITTED Y RULE 144(k) UNDER THE SECURITIES ACT
OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF (OR ANY PREDECESSOR OF THIS SECURITY) AND THE LAST DAY ON WHICH
TESORO PETROLEUM CORPORATION (THE "COMPANY") OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER
DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS (THE "RESALE RESTRICTION
TERMINATION DATE"), EXCEPT (A) TO THE COMPANY OR A SUBSIDIARY THEREOF, (B)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT IS ACQUIRING SUCH
NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL
ACCREDITED INVESTOR") THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS RELATING TO RESTRICTIONS ON
TRANSFER OF THE NOTE EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED
FROM THE TRUSTEE), (E) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT
OCCUR IN AN "OFFSHORE TRANSACTION" WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND (2) THAT IT WILL GIVE TO
EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE, THE TRANSFER
AGENT AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER (i) PURSUANT TO CLAUSE (C), (D), (E) OR (F) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM, AND (ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THE HOLDER HEREOF, BY PURCHASING
THIS NOTE, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1)
A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (2) AN
INSTITUTIONAL ACCREDITED INVESTOR, (3) A NON-U.S. PERSON AND IS ACQUIRING THE
NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO REGULATION S UNDER THE SECURITIES
ACT OR (4) IT IS A PERSON ELIGIBLE TO BE TRANSFERRED THIS NOTE IN ACCORDANCE
WITH CLAUSE (F) OF THE FOREGOING SENTENCE. THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES"
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AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
Capitalized terms used herein shall have the meanings assigned to them
in the indenture referred to below unless otherwise indicated.
1. Interest. Tesoro Petroleum Corporation, a Delaware
corporation (the "Company"), promises to pay interest on the principal amount
of this Note at 9% per annum from July 2, 1998 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 5 of the Registration Rights
Agreement referred to below. The Company will pay interest and Liquidated
Damages semi-annually in arrears on January 1 and July 1 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each
an "Interest Payment Date"). Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of original issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated between a
record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest Payment
Date, except in the case of the original issuance of Notes, in which case
interest shall accrue from date of authentication; provided, further, that the
first Interest Payment Date shall be January 1, 1999. The Company shall pay
interest (including postpetition interest in any proceeding under the
Bankruptcy Code) on overdue principal and premium, if any, from time to time on
demand at the rate borne on the Notes; it shall pay interest (including
post-petition interest in any proceeding under the Bankruptcy Code) on overdue
installments of interest and Liquidated Damages, if any, (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be entitled
to the same benefits as other Notes under the Indenture.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) and Liquidated Damages to the Persons who are
registered Holders of Notes at the close of business on the December 15 or June
15 next preceding the Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted interest.
The Notes will be payable as to principal, premium and Liquidated Damages, if
any, and interest at the office or agency of the Company maintained for such
purpose within the City and State of New York, or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check mailed
to the Holders at their addresses set forth in the register of Holders, and
provided that payment by wire transfer of immediately available funds will be
required with respect to principal of, and interest, premium and Liquidated
Damages on, all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent.
Such payment
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shall be in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
3. Paying Agent and Registrar. Initially, U.S. Bank Trust
National Association, the Trustee under the Indenture, will act as Paying Agent
and Registrar. The Company may change any Paying Agent or Registrar without
notice to any Holder. The Company or any of its Subsidiaries may act in any
such capacity.
4. Indenture; Subordination. The Company issued the Notes under
an Indenture dated as of July 2, 1998 ("Indenture") between the Company,
Guarantors and the Trustee, as the same may be amended, modified or
supplemented from time to time. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. To the extent any provision of
this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling. The Notes are
general unsecured obligations of the Company limited to $300,000,000 aggregate
principal amount in the case of Notes issued on the Issue Date.
The Notes are subordinated in right of payment, in the manner and to
the extent set forth in the Indenture, to the prior payment in full in cash of
all Senior Debt of the Company, whether outstanding on the date of the
Indenture or thereafter created, incurred, assumed or guaranteed. The
Subsidiary Guarantees in respect of the Notes will be subordinated in right of
payment, in the manner and to the extent set forth in the Indenture, to the
prior payment in full in cash of all Senior Debt of each Guarantor, whether
outstanding on the date of the Indenture or thereafter created, incurred
assumed or guaranteed. Each Holder by its acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on its
behalf, to take such action as may be necessary or appropriate to effectuate
the subordination provided for in the Indenture and appoints the Trustee its
attorney-in-fact for such purposes.
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this
paragraph 5 and paragraph 8 below, the Notes shall not be redeemable at the
Company's option prior to July 1, 2003. Thereafter, the Notes will be subject
to redemption at any time or from time to time at the option of the Company, in
whole or in part, at the redemption prices (expressed as percentages of
principal amount) set forth below plus accrued and unpaid interest and
Liquidated Damages, if any, thereon, to the applicable redemption date, if
redeemed during the twelve-month period beginning on July 1 of the years
indicated below:
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YEAR PERCENTAGE
---- ----------
2003 .............................. 104.5%
2004 .............................. 103.0%
2005 .............................. 101.5%
2006 and thereafter ................ 100.000%
(b) Notwithstanding the foregoing, at any time or from
time to time prior to July 1, 2001, the Company may on any one or more
occasions redeem up to 35% of the aggregate principal amount of Notes
outstanding at a redemption price of 109% of the principal amount thereof, plus
accrued and unpaid interest, if any, and Liquidated Damages thereon, if any, to
the redemption date, with the net cash proceeds of any one or more Public
Equity Offerings; provided that at least 65% of the aggregate principal amount
of Notes outstanding on the Issue Date remain outstanding immediately after
each occurrence of such redemption; and provided, further, that each such
redemption shall occur within 90 days of the date of the closing of such Public
Equity Offering.
6. Mandatory Redemption. Except as set forth in paragraph 8
below, the Company shall not be required to make mandatory redemption payments
with respect to the Notes.
7. Repurchase at Option of Holder.
(a) Upon the occurrence of a Change of Control, each
Holder of Notes will have the right to require the Company to repurchase all or
any part (equal to $1,000 or an integral multiple thereof) of such Holder's
Notes pursuant to a Change of Control Offer described in the Indenture 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, thereon, to
the date of purchase (the "Change of Control Payment"). Within 30 days
following any Change of Control, the Company shall mail a notice to each Holder
setting forth the procedures governing the Change of Control Offer as required
by the Indenture.
(b) If the Company or a Restricted Subsidiary consummates
any Asset Sales and the aggregate amount of Excess Proceeds exceeds
$10,000,000, the Company shall commence an offer to all Holders of Notes (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture (pro rata in
proportion to outstanding Indebtedness that is pari passu with the Notes that
require asset sales offers) to purchase the maximum principal amount of 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 and unpaid
interest and Liquidated Damages thereon, if any, to the date of purchase, in
accordance with the procedures set forth in the Indenture. To the extent that
the aggregate amount of Notes tendered pursuant to an Asset Sale Offer is less
than the Excess Proceeds, the Company (or such Restricted Subsidiary) may use
such deficiency for general corporate purposes. If the aggregate principal
amount of Notes surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes to be purchased on a pro rata
basis. Holders of Notes that are the subject of an offer to purchase will
receive an Asset Sale Offer from the Company prior to any related purchase date
and may elect to have such Notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes.
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8. Special Redemption. If the Washington Acquisition is not
consummated by the Company, or the Washington Agreement is terminated without
consummation of the Washington Acquisition, on or prior to December 31, 1998,
the Company shall redeem outstanding Notes in an amount equal to 50% of the
aggregate principal amount of the Original Notes at a redemption price equal to
101% of the redeemed principal amount thereof (the "Special Redemption Price"),
plus accrued interest and Liquidated Damages, if any, to the date of
redemption. The date for such redemption (the "Special Redemption Date") shall
be the earlier of December 31, 1998 and ten business days following the date of
termination of the Washington Agreement without consummation of the Washington
Acquisition. Selection of Notes for special redemption will be made by the
Trustee in compliance with the requirements of the principal national
securities exchange, if any, on which the Notes are listed, or, if the Notes
are not so listed, on a pro rata basis, or by such method (other than by lot)
as the Trustee shall deem fair and appropriate; provided that no Notes of
$1,000 or less shall be redeemed in part. Notice of the Special Redemption to
the Trustee and the Holders shall be made in accordance with Sections 3.01 and
3.03 of the Indenture.
9. Notice of Redemption. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date (other than
in connection with a Special Redemption) to each Holder whose Notes are to be
redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part but only in whole multiples of $1,000, unless all of
the Notes held by a Holder are to be redeemed. On and after the redemption
date, interest and Liquidated Damages, if any, cease to accrue on Notes or
portions thereof called for redemption.
10. Denominations, Transfer, Exchange. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture. The Company need not
exchange or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part. Also, it need not exchange or register the transfer of any Notes for a
period of 15 days before a selection of Notes to be redeemed or during the
period between a record date and the corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in
part for one or more Global Notes only (i) on or after the termination of the
40-day restricted period (as defined in Regulation S) and (ii) upon presentation
of certificates (accompanied by an Opinion of Counsel, if applicable) required
by Article II of the Indenture. Upon exchange of this Regulation S Temporary
Global Note for one or more Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
11. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
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12. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes, and any existing default or compliance with any provision of
the Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes or to
alter the provisions of Article II of the Indenture (including the related
definitions) in a manner that does not materially adversely affect any Holder,
to provide for the assumption of the Company's obligations to Holders of the
Notes in case of a merger, consolidation or sale of assets pursuant to Article
V of the Indenture or to add any Person as a Guarantor or to release any
Guarantor or otherwise comply with Article XI of the Indenture, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the
Indenture of any such Holder, or to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the TIA.
13. Defaults and Remedies. Events of Default include: (a) default
in the payment when due of interest on, or Liquidated Damages, if any, with
respect to, the Notes and such default continues for a period of 30 days; (b)
default in the payment when due of principal of, or premium, if any, on, the
Notes; (c) failure by the Company to comply with any of the provisions of
Section 5.01 of the Indenture; (d) failure by the Company or any of its
Restricted Subsidiaries to comply with any of the provisions of Section 3.10,
4.10 or 4.15 of the Indenture; (e) failure by the Company or any of its
Restricted Subsidiaries to observe or perform any other covenant or other
agreement in the Indenture or the Notes for 60 days after written notice to the
Company by the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding; (f) a default occurs under any mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any Indebtedness for money borrowed by the Company or
any of its Restricted Subsidiaries (or the payment of which is guaranteed by
the Company or any of its Restricted Subsidiaries), whether such Indebtedness
or guarantee now exists, or is created after the Issue Date, 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 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 without duplication
$15,000,000 or more, and such default shall not have been cured or waived or
any such acceleration rescinded within 10 Business Days after the running of
such grace period or the occurrence of such acceleration; (g) a final judgment
or final judgments for the payment of money are entered by a court or courts of
competent jurisdiction against the Company or any of its Restricted
Subsidiaries, and such judgment or judgments remain unpaid, unstayed or
undischarged for a period (during which execution shall not be effectively
stayed) of 60 days, provided that the aggregate of all such unpaid or
undischarged judgments exceeds $15,000,000 (excluding amounts covered by
insurance); (h) certain events of bankruptcy or insolvency with respect to the
Company or any of its Subsidiaries that, when taken
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together, would constitute a Significant Subsidiary or any of its Significant
Subsidiaries; or (i) except as permitted in the Indenture, any 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 any
Guarantor, or any Person acting on behalf of any Guarantor, shall deny or
disaffirm its obligations under its Subsidiary Guarantee (other than by reason
of termination of the Indenture or the release of such Subsidiary Guarantee in
accordance with the Indenture). 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 Notes may declare all the Notes to be due and payable
immediately. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all outstanding Notes
will become due and payable without further action or notice. Holders may not
enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of interest on, or the
principal of, the Notes. The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the Company
is required upon becoming aware of any Default or Event of Default, to deliver
to the Trustee a statement specifying such Default or Event of Default.
14. Trustee Dealings with Company. The Trustee, in its individual
or any other capacity, may make loans to, accept deposits from, and perform
services for, the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
15. No Recourse Against Others. A director, officer, employee,
incorporator, partner, member or stockholder of the Company or any Subsidiary
of the Company or any Guarantor, as such, shall not have any liability for any
obligations of the Company or Guarantors under the Notes, the Subsidiary
Guarantees or 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 Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
16. Authentication. This Note shall not be valid until
authenticated by the manual signature of a Responsible Officer of the Trustee
or an authenticating agent.
17. Abbreviations. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entireties), JT TEN joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
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135
18. Additional Rights of Holders of Restricted Global Notes and
Restricted Definitive Notes. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have all the rights set forth in the Registration Rights
Agreement dated as of [July 2, 1998] [bracketed date to be included on Original
Notes, all other Notes should reference date of any corresponding Registration
Rights Agreement], between the Company and the parties named on the signature
pages thereof (the "Registration Rights Agreement").
19. CUSIP Numbers. Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Tesoro Petroleum Corporation
8700 Tesoro Drive
San Antonio, Texas 78217-6218
Attention: Vice President, Finance and Treasurer
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136
NOTATION OF SUBSIDIARY GUARANTEES
Payment of principal of, and premium, if any, interest and Liquidated
Damages, if any, on, this Note is jointly, severally, and unconditionally
guaranteed on a senior subordinated basis to the extent and in the manner set
forth in the Indenture by the Guarantors who have become parties to the
Indenture, including the Guarantors duly endorsing this notation. Subsidiary
Guarantees are subject to release under circumstances set forth in the
Indenture.
[Insert Names of Guarantors]
BY TESORO PETROLEUM CORPORATION
Attorney in fact for each of the Guarantors
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
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137
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
- --------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
---------------------------------------------------------
- --------------------------------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
- --------------------------------------------------------------------------------
Date:
Your Signature:
-----------------------------------------------------------------
(Sign exactly as your name appears on the face of this Note)
SIGNATURE GUARANTEE
- --------------------------------------------------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting the
requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other
"signature guarantee program" as may be
determined by the Registrar in addition to,
or in substitution for, STAMP, all in
accordance with the Securities Exchange Act
of 1934, as amended.
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138
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$
-----------------
Date:
Your Signature:
----------------------------------------------------------------
(Sign exactly as your name appears on the face of the Note)
Tax Identification No.:
-------------------------------------------------------
SIGNATURE GUARANTEE
- --------------------------------------------------------------------------------
Signatures must be guaranteed by an
"eligible guarantor institution" meeting the
requirements of the Registrar, which
requirements include membership or
participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other
"signature guarantee program" as may be
determined by the Registrar in addition to,
or in substitution for, STAMP, all in
accordance with the Securities Exchange Act
of 1934, as amended.
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139
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note or Definitive Note, or of
other Restricted Global Notes or Restricted Definitive Note for an interest in
this Regulation S Temporary Global Note, have been made:
PRINCIPAL AMOUNT OF SIGNATURE OF
AMOUNT OF AMOUNT OF OF THIS GLOBAL NOTE AUTHORIZED
DECREASE IN INCREASE IN FOLLOWING SUCH SIGNATORY OF
PRINCIPAL AMOUNT PRINCIPAL AMOUNT DECREASE (OR TRUSTEE OR NOTE
DATE OF EXCHANGE OF THIS GLOBAL NOTE OF THIS GLOBAL NOTE INCREASE) CUSTODIAN
---------------- ------------------- ------------------- ------------------ ---------------
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