EXHIBIT 4.1
EXECUTION COPY
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RANGE RESOURCES CORPORATION
As Issuer
PMOG HOLDINGS, INC.
RANGE ENERGY I, INC.
RANGE HOLDCO, INC.
RANGE PRODUCTION COMPANY
RANGE ENERGY VENTURES CORPORATION
GULFSTAR ENERGY, INC.
RANGE ENERGY FINANCE CORPORATION
RB OPERATING COMPANY
As Guarantors
6 3/8% SENIOR SUBORDINATED NOTES DUE 2015
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INDENTURE
Dated as of March 9, 2005
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J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
As Trustee
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CROSS -REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
310 (a) (1)........................................... 7.10
(a) (2)........................................... 7.10
(a) (3)........................................... N.A.
(a) (4)........................................... N.A.
(a) (5)........................................... 7.10
(b)............................................... 7.10
(c)............................................... N.A.
311 (a)............................................... 7.11
(b)............................................... 7.11
(c)............................................... N.A.
(b)............................................... 12.03
(c)............................................... 12.03
313 (a)............................................... 7.06
(b) (1)........................................... N.A.
(b) (2)........................................... 7.07
(c)............................................... 7.06, 12.02
(d)............................................... 7.06
314 (a)............................................... 4.03; 12.02
(b)............................................... N.A.
(c) (1)........................................... 12.04
(c) (2)........................................... 12.04
(c) (3)........................................... N.A.
(d)............................................... 10.03 - 10.05
(e)............................................... 12.05
(f)............................................... N.A.
315 (a)............................................... 7.01
(b)............................................... 7.05; 12.02
(c)............................................... 7.01
(d)............................................... 7.01
(e)............................................... 6.11
316 (a)............................................... 2.05
(a) (1) (A)....................................... 6.05
(a) (1) (B)....................................... 6.04
(a) (2)........................................... N.A.
(b)............................................... 6.07
(c)............................................... 12.02
317 (a) (1)........................................... 6.08
(a) (2)........................................... 6.09
(b)............................................... 2.03
318 (a)............................................... 12.01
(b)............................................... N.A.
(c)............................................... 12.01
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N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
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PAGE
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions....................................................................... 1
Section 1.02. Other Definitions................................................................. 18
Section 1.03. Incorporation by Reference of Trust Indenture Act................................. 19
Section 1.04. Rules of Construction............................................................. 20
ARTICLE 2
THE NOTES
Section 2.01. Form, Dating and Denominations 144A, Reg S; Legends 144A, Reg S................... 20
Section 2.02. Execution and Authentication; Exchange Notes; Additional Notes.................... 21
Section 2.03. Registrar, Paying Agent and Authenticating Agent; Paying Agent to Hold
Money in Trust........................................................................... 22
Section 2.04. Replacement Notes................................................................. 23
Section 2.05. Outstanding Notes................................................................. 23
Section 2.06. Temporary Notes................................................................... 24
Section 2.07. Cancellation...................................................................... 24
Section 2.08. CUSIP and CINS Numbers............................................................ 24
Section 2.09. Registration, Transfer and Exchange............................................... 25
Section 2.10. Restrictions on Transfer and Exchange............................................. 27
Section 2.11. Regulation S Temporary Offshore Global Notes...................................... 29
Section 2.12. Defaulted Interest................................................................ 30
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee................................................................ 30
Section 3.02. Selection of Notes to be Redeemed................................................. 30
Section 3.03. Notice of Redemption.............................................................. 31
Section 3.04. Effect of Notice of Redemption.................................................... 32
Section 3.05. Deposit of Redemption Price....................................................... 32
Section 3.06. Notes Redeemed in Part............................................................ 32
Section 3.07. Optional Redemption............................................................... 32
Section 3.08. Mandatory Redemption.............................................................. 33
Section 3.09. Offer to Purchase by Application of Excess Proceeds............................... 33
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.................................................................. 35
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Section 4.02. Maintenance of Office or Agency................................................... 35
Section 4.03. Reports........................................................................... 36
Section 4.04. Compliance Certificate............................................................ 36
Section 4.05. Taxes............................................................................. 37
Section 4.06. Stay, Extension and Usury Laws.................................................... 37
Section 4.07. Restricted Payments............................................................... 37
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.................... 40
Section 4.09. Incurrence of Indebtedness and Issuance of Disqualified Stock..................... 40
Section 4.10. Asset Sales....................................................................... 42
Section 4.11. Transactions with Affiliates...................................................... 43
Section 4.12. Liens............................................................................. 44
Section 4.13. Offer to Repurchase Upon Change of Control........................................ 44
Section 4.14. Additional Subsidiary Guarantees.................................................. 45
Section 4.15. Corporate Existence............................................................... 45
Section 4.16. No Senior Subordinated Debt....................................................... 46
Section 4.17. Business Activities............................................................... 46
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Substantially All Assets........................ 46
Section 5.02. Successor Corporation Substituted................................................. 47
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default................................................................. 47
Section 6.02. Acceleration...................................................................... 49
Section 6.03. Other Remedies.................................................................... 50
Section 6.04. Waiver of Past Defaults........................................................... 50
Section 6.05. Control by Majority............................................................... 51
Section 6.06. Limitation on Suits............................................................... 51
Section 6.07. Rights of Holders of Notes to Receive Payment..................................... 51
Section 6.08. Collection Suit by Trustee........................................................ 51
Section 6.09. Trustee May File Proofs of Claim.................................................. 52
Section 6.10. Priorities........................................................................ 52
Section 6.11. Undertaking for Costs............................................................. 53
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee................................................................. 53
Section 7.02. Rights of Trustee................................................................. 54
Section 7.03. Individual Rights of Trustee...................................................... 55
Section 7.04. Trustee's Disclaimer.............................................................. 55
Section 7.05. Notice of Defaults................................................................ 56
Section 7.06. Reports by Trustee to Holders of the Notes........................................ 56
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Section 7.07. Compensation and Indemnity........................................................ 56
Section 7.08. Replacement of Trustee............................................................ 57
Section 7.09. Successor Trustee by Merger, etc.................................................. 58
Section 7.10. Eligibility; Disqualification..................................................... 58
Section 7.11. Preferential Collection of Claims Against Company................................. 58
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.......................... 59
Section 8.02. Legal Defeasance and Discharge.................................................... 59
Section 8.03. Covenant Defeasance............................................................... 59
Section 8.04. Conditions to Legal or Covenant Defeasance........................................ 60
Section 8.05. Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions................................................................. 61
Section 8.06. Repayment to Company.............................................................. 62
Section 8.07. Reinstatement..................................................................... 62
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes............................................... 62
Section 9.02. With Consent of Holders of Notes.................................................. 63
Section 9.03. Compliance with Trust Indenture Act............................................... 65
Section 9.04. Revocation and Effect of Consents................................................. 65
Section 9.05. Notation on or Exchange of Notes.................................................. 65
Section 9.06. Trustee to Sign Amendment, etc.................................................... 65
ARTICLE 10
SUBORDINATION
Section 10.01. Agreement to Subordinate......................................................... 65
Section 10.02. Certain Definitions.............................................................. 66
Section 10.03. Liquidation; Dissolution; Bankruptcy............................................. 66
Section 10.04. Default on Designated Senior Debt................................................ 68
Section 10.05. Acceleration of Notes............................................................ 69
Section 10.06. When Distribution Must be Paid Over.............................................. 69
Section 10.07. Notice by Company................................................................ 70
Section 10.08. Subrogation...................................................................... 70
Section 10.09. Relative Rights.................................................................. 70
Section 10.10. Subordination May Not be Impaired by Company or the Subsidiary
Guarantors............................................................................... 71
Section 10.11. Payment, Distribution or Notice to Representative................................ 71
Section 10.12. Rights of Trustee and Paying Agent............................................... 71
Section 10.13. Authorization to Effect Subordination............................................ 72
Section 10.14. Amendments....................................................................... 72
Section 10.15. No Waiver of Subordination Provisions............................................ 72
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ARTICLE 11
THE GUARANTEES
Section 11.01. The Guarantees................................................................... 72
Section 11.02. Execution and Delivery of Guarantees............................................. 73
Section 11.03. Subsidiary Guarantors May Consolidate, etc., on Certain Terms.................... 74
Section 11.04. Releases of Guarantees........................................................... 75
Section 11.05. Limitation on Subsidiary Guarantor Liability..................................... 75
Section 11.06. "Trustee" to Include Paying Agent................................................ 76
Section 11.07. Subordination of Guarantees...................................................... 76
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls..................................................... 76
Section 12.02. Notices.......................................................................... 76
Section 12.03. Communication by Holders of Notes with Other Holders of Notes.................... 78
Section 12.04. Certificate and Opinion as to Conditions Precedent............................... 78
Section 12.05. Statements Required in Certificate or Opinion.................................... 78
Section 12.06. Rules by Trustee and Agents...................................................... 78
Section 12.07. No Personal Liability of Directors, Officers, Employees and Stockholders......... 79
Section 12.08. Governing Law.................................................................... 79
Section 12.09. No Adverse Interpretation of Other Agreements.................................... 79
Section 12.10. Successors....................................................................... 79
Section 12.11. Severability..................................................................... 79
Section 12.12. Counterpart Originals............................................................ 79
Section 12.13. Table of Contents, Headings, etc................................................. 79
Section 12.14. Actions on Other than Business Days.............................................. 80
EXHIBITS
EXHIBIT A Form of Note
EXHIBIT B Reserved
EXHIBIT C Restricted Legend
EXHIBIT D DTC Legend
EXHIBIT E Regulation S Certificate
EXHIBIT F Rule 144A Certificate
EXHIBIT G Certificate of Beneficial Ownership
EXHIBIT H Temporary Offshore Global Note Legend
EXHIBIT I Guarantee
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INDENTURE dated as of March 9, 2005 among Range Resources
Corporation, a Delaware corporation (the "Company"), as issuer, the Subsidiary
Guarantors (as hereinafter defined) as guarantors and J.P. Morgan Trust Company,
National Association, as trustee (the "Trustee").
The Company, the Subsidiary Guarantors and the Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders of the 6 3/8% Senior Subordinated Notes due 2015 of the Company (the
"Notes"):
Article 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Additional Notes" means any notes issued under the Indenture in
addition to the Original Notes, including any Exchange Notes issued in exchange
for such Additional Notes, having the same terms in all respects as the Original
Notes except that the date from which interest on the Additional Notes will
accrue may be different.
"Adjusted Consolidated Net Tangible Assets" means (without
duplication), as of the date of determination, (i) the sum of (a) discounted
future net revenues from proved oil and gas reserves of the Company and its
Restricted Subsidiaries calculated in accordance with the Commission's
guidelines before any state or federal income taxes, with no less than 80% of
the discounted future net revenues estimated by one or more nationally
recognized firms of independent petroleum engineers in a reserve report prepared
as of the end of the Company's most recently completed fiscal year, as increased
by, as of the date of determination, the estimated discounted future net
revenues from (1) estimated proved oil and gas reserves acquired since the date
of such year-end reserve report, and (2) estimated oil and gas reserves
attributable to upward revisions of estimates of proved oil and gas reserves
since the date of such year-end reserve report due to exploration, development
or exploitation activities, in each case calculated in accordance with the
Commission's guidelines (utilizing the prices utilized in such
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year-end reserve report) increased by the accretion of the discount from the
date of the reserve report to the date of determination, and decreased by, as of
the date of determination, the estimated discounted future net revenues from (3)
estimated proved oil and gas reserves produced or disposed of since the date of
such year-end reserve report and (4) estimated oil and gas reserves attributable
to downward revisions of estimates of proved oil and gas reserves since the date
of such year-end reserve report due to changes in geological conditions or other
factors which would, in accordance with standard industry practice, cause such
revisions, in each case calculated in accordance with the Commission's
guidelines (utilizing the prices utilized in such year-end reserve report);
provided that, in the case of each of the determinations made pursuant to clause
(1) through (4), such increases and decreases shall be as estimated by the
Company's petroleum engineers, unless in the event that there is a Material
Change as a result of such acquisitions, dispositions or revisions, then the
discounted future net revenues utilized for purposes of this clause (i) (a)
shall be confirmed in writing by one or more nationally recognized firms of
independent petroleum engineers, (b) the capitalized costs that are attributable
to oil and gas properties of the Company and its Restricted Subsidiaries to
which no proved oil and gas reserves are attributable, based on the Company's
books and records as of a date no earlier than the date of the Company's latest
annual or quarterly financial statements, (c) the Net Working Capital on a date
no earlier than the date of the Company's latest annual or quarterly financial
statements and (d) the greater of (1) the net book value on a date no earlier
than the date of the Company's latest annual or quarterly financial statements
or (2) the book value of other tangible assets (including, without duplication,
investments in unconsolidated Restricted Subsidiaries and mineral rights held
under lease or other contractual arrangements) of the Company and its Restricted
Subsidiaries, as of the date no earlier than the date of the Company's latest
annual or quarterly financial statements, minus (ii) the sum of (a) minority
interests, (b) any gas balancing liabilities of the Company and its Restricted
Subsidiaries reflected in the Company's latest audited financial statements, and
(c) the discounted future net revenues, calculated in accordance with the
Commission's guidelines, attributable to reserves subject to Dollar-Denominated
Production Payments which, based on the estimates of production and price
assumptions included in determining the discounted future net revenues specified
in (i) (a) above, would be necessary to fully satisfy the payment obligations of
the Company and its Restricted Subsidiaries with respect to Dollar-Denominated
Production Payments on the schedules specified with respect thereto. If the
Company changes its method of accounting from the successful efforts method to
the full cost method or a similar method of accounting, "Adjusted Consolidated
Net Tangible Assets" will continue to be calculated as if the Company was still
using the successful efforts method of accounting.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial 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.
"Agent Member" means a member of, or a participant in, the
Depositary.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition (but excluding the creation of a Lien) of any assets including,
without limitation, by way of a sale and leaseback; provided that the sale,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company and its Subsidiaries taken as a whole shall be governed by
Sections 4.13 and/or 5.01 hereof and not by Section 4.10 hereof, and (ii) the
issuance or sale by the Company or any of its Restricted Subsidiaries of Equity
Interests of any of the Company's Subsidiaries
2
(including the sale by the Company or a Restricted Subsidiary of Equity
Interests in an Unrestricted Subsidiary), in the case of either clause (i) or
(ii), whether in a single transaction or a series of related transactions (a)
that have a fair market value in excess of $5.0 million or (b) for net proceeds
in excess of $5.0 million. Notwithstanding the foregoing, the following shall
not be deemed to be Asset Sales: (1) a transfer of assets by the Company to a
Wholly Owned Restricted Subsidiary of the Company or by a Wholly Owned
Restricted Subsidiary of the Company to the Company or to another Wholly Owned
Restricted Subsidiary of the Company, (2) an issuance of Equity Interests by a
Wholly Owned Restricted Subsidiary of the Company to the Company or to another
Wholly Owned Restricted Subsidiary of the Company, (3) the making of a Permitted
Investment or a Restricted Payment that is permitted by Section 4.07, (4) the
abandonment, farm-out, lease or sublease of undeveloped oil and gas properties
in the ordinary course of business, (5) the trade or exchange by the Company or
any Restricted Subsidiary of the Company of any oil and gas property owned or
held by the Company or such Restricted Subsidiary for any oil and gas property
owned or held by another Person, which the Board of Directors of the Company
determines in good faith to be of approximately equivalent value, (6) the trade
or exchange by the Company or any Subsidiary of the Company of any oil and gas
property owned or held by the Company or such Subsidiary for Equity Interests in
another Person engaged primarily in the Oil and Gas Business which, together
with all other such trades or exchanges (to the extent excluded from the
definition of Asset Sale pursuant to this clause (6)) since the date of this
Indenture, do not exceed 5% of Adjusted Consolidated Net Tangible Assets
determined after such trade or exchange and (7) the sale or transfer of
hydrocarbons or other mineral products or other inventory or surplus or obsolete
equipment in the ordinary course of business.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Authenticating Agent" refers to a Person engaged to authenticate the
Notes in the stead of the Trustee.
"Bankruptcy Code" means Title 11 of the United States Code, as
amended.
"Board of Directors" means the Board of Directors of the Company or a
Subsidiary Guarantor, as applicable, or any authorized committee of such Board
of Directors.
"Borrowing Base" means, as of any date, the aggregate amount of
borrowing availability as of such date under all Credit Facilities that
determine availability on the basis of a borrowing base or other asset-based
calculation.
"Business Day" means any day other than a Legal Holiday.
3
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership, partnership
interests (whether general or limited), (iv) in the case of a limited liability
company or similar entity, any membership or similar interests therein and (v)
any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, the
issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof having maturities of not
more than six months from the date of acquisition, (iii) certificates of deposit
and eurodollar time deposits with maturities of six months or less from the date
of acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any lender party to the Credit
Agreement or with any domestic commercial bank having capital and surplus in
excess of $500 million and a 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 a rating of at least P1 from Moody's or
a rating of at least Al from S&P, and (vi) investments in money market or other
mutual funds substantially all of whose assets comprise securities of the types
described in clauses (ii) through (v) above.
"Certificate of Beneficial Ownership" means a certificate
substantially in the form of Exhibit G.
"Certificated Note" means a Note in registered individual form
without interest coupons.
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole to any "person" or group of related "persons" (as such terms are used in
Section 13(d)(3) of the Exchange Act), (ii) the adoption of a plan relating to
the liquidation or dissolution of the Company, (iii) the consummation of any
transaction (including, without limitation, any purchase, sale, acquisition,
disposition, merger or consolidation) the result of which is that any "person"
(as defined above) or group of related "persons" becomes the "beneficial owner"
(as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act) of
more than 40% of the aggregate voting power of all classes of Capital Stock of
the Company having the right to elect directors under ordinary circumstances or
(iv) the first day on which a majority of the members of the Board of Directors
of the Company are not Continuing Directors.
"Closing Date" the date of the closing of the sale of the Original
Notes offered pursuant to the Offering.
4
"Commission" means the Securities and Exchange Commission.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person and its Restricted
Subsidiaries for such period plus (i) an amount equal to any extraordinary loss,
plus any net loss realized in connection with an Asset Sale (together with any
related provision for taxes), to the extent such losses were included in
computing such Consolidated Net Income, plus (ii) provision for taxes based on
income or profits of such Person and its Restricted Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letters
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Interest Rate Hedging Agreements), to the extent that any such expense was
included in computing such Consolidated Net Income, plus (iv) depreciation,
depletion and amortization expenses (including amortization of goodwill and
other intangibles) for such Person and its Restricted Subsidiaries for such
period to the extent that such depreciation, depletion and amortization expenses
were included in computing such Consolidated Net Income, plus (v) exploration
expenses for such Person and its Restricted Subsidiaries for such period to the
extent such exploration expenses were included in computing such Consolidated
Net Income, plus (vi) other non-cash charges (excluding any such non-cash charge
to the extent that it represents an accrual of or reserve for cash charges in
any future period or amortization of a prepaid cash expense that was paid in a
prior period) of such Person and its Restricted Subsidiaries for such period to
the extent that such other non-cash charges were included in computing such
Consolidated Net Income, in each case, on a consolidated basis and determined in
accordance with GAAP. Notwithstanding the foregoing, the provision for taxes on
the income or profits of, and the depreciation, depletion and amortization and
other non-cash charges and expenses of, a Restricted Subsidiary of the referent
Person shall be added to Consolidated Net Income to compute Consolidated Cash
Flow only to the extent (and in same proportion) that the Net Income of such
Restricted Subsidiary was included in calculating the Consolidated Net Income of
such Person and only if a corresponding amount would be permitted at the date of
determination to be dividend to the Company by such Restricted Subsidiary
without prior governmental approval (that has not been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person or a Wholly Owned Restricted
Subsidiary thereof, (ii) the Net Income of any Restricted Subsidiary shall be
excluded to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that
5
Net Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iii) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded, (iv) the cumulative effect of a change in
accounting principles shall be excluded, (v) any impairments or write-downs of
oil and natural gas assets shall be excluded, provided, however, that ceiling
limitation write-downs in accordance with GAAP shall be treated as capitalized
costs, as if such write-downs had not occurred, (vi) extraordinary non-cash
losses shall be excluded, (vii) any non-cash compensation expenses realized for
grants of performance shares, stock options or stock awards to officers,
directors and employees of the Company or any of its Restricted Subsidiaries
shall be excluded and (viii) any unrealized non-cash gains or losses or changes
in respect of hedge or non-hedge derivatives (including those resulting from the
application of the Financial Accounting Standards Board's Statement of Financial
Accounting Standards No. 133) shall be excluded.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its consolidated Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Company ending prior to the taking of any
action for the purpose of which the determination is being made and for which
internal financial statements are available (but in no event ending more than
135 days prior to the taking of such action), as (i) the par or stated value of
all outstanding Capital Stock of the Company, plus (ii) paid-in capital or
capital surplus relating to such Capital Stock, plus (iii) any retained earnings
or earned surplus, less (a) any accumulated deficit and (b) any amounts
attributable to Disqualified Stock.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of original issuance of the Notes or (ii) was
nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of such Board at the
time of such nomination.
"Corporate Trust Office of the Trustee" shall be at the address of
the Trustee specified in Section 12.02 hereof or such other address as to which
the Trustee may give notice to the Company.
"Credit Agreement" means that certain Second Amended and Restated
Credit Agreement, dated as of June 23, 2004, as amended on December 6, 2004, and
as further amended on March 2, 2005, by and among the Company, Great Lakes
Energy Partners L.L.C., and JPMorgan Chase Bank, N.A. (successor by merger to
Bank One, N.A. (Illinois), a national banking association), The Frost National
Bank, The Bank of Nova Scotia, Union Bank of California, N.A., Wachovia Bank,
National Association, Key Bank, Harris Nesbitt
6
Financing, Inc., Southwest Bank of Texas, N.A., Hibernia National Bank, Comerica
Bank, Natexis Banques Populaires, Fortis Capital Corp., Fleet National Bank,
Compass Bank, Calyon New York Branch and Bank of Scotland and JPMorgan Chase
Bank N.A. (formerly Bank One, NA), as Administrative Agent, Fleet National Bank,
as Co-Documentation Agent, Fortis Capital Corp., as Co-Documentation Agent,
Calyon, New York Branch, as Co-Syndication Agent, Harris Nesbitt Financing,
Inc., as Co-Syndication Agent, J.P. Morgan Securities Inc. (formerly Banc One
Capital Markets, Inc.), as Sole Lead Arranger and Sole Bookrunner providing for
up to $600 million of Indebtedness, including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, and in each case as amended, restated, modified, renewed, refunded,
replaced or refinanced, in whole or in part, from time to time, whether or not
with the same lenders or agents.
"Credit Facilities" means, with respect to the Company, one or more
debt facilities (including, without limitation, the Credit Agreement) or
commercial paper facilities with banks or other institutional lenders providing
for revolving credit loans, term loans, production payment financing,
receivables financing (including through the sale of receivables to such lenders
or to special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time.
Indebtedness under Credit Facilities outstanding on the date on which the Notes
are first issued and authenticated under this Indenture (after giving effect to
the use of proceeds thereof) shall be deemed to have been incurred on such date
in reliance on the exception provided by clause (b) of the definition of
Permitted Indebtedness set forth in Section 4.09 hereof.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Depositary" means the depositary of each Global Note, which will
initially be DTC.
"Designated Senior Debt" means (i) the Credit Agreement and (ii) any
other Senior Debt permitted under this Indenture the principal amount of which
is $25 million or more and that has been designated by the Company as
"Designated Senior Debt."
"Disqualified Stock" means any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the Holder thereof, in whole or in part, on or prior to the date
that is 91 days after the date on which the Notes mature.
"Dollar-Denominated Production Payments" means production payment
obligations recorded as liabilities in accordance with GAAP, together with all
undertakings and obligations in connection therewith.
"DTC" means The Depository Trust Company, a New York corporation, and
its successors.
"DTC Legend" means the legend set forth in Exhibit D.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
7
"Exchange Notes" means the Notes of the Company issued pursuant to
the Indenture in exchange for, and in an aggregate principal amount equal to,
the Initial Notes or any Initial Additional Notes in compliance with the terms
of a Registration Rights Agreement and containing terms substantially identical
to the Initial Notes or any Initial Additional Notes (except that (i) such
Exchange Notes will be registered under the Securities Act and will not be
subject to transfer restrictions or bear the Restricted Legend, and (ii) the
provisions relating to Liquidated Damages will be eliminated).
"Exchange Offer" means an offer by the Company to the Holders of the
Initial Notes or any Initial Additional Notes to exchange outstanding Notes for
Exchange Notes, as provided for in a Registration Rights Agreement.
"Exchange Offer Registration Statement" means the Exchange Offer
Registration Statement as defined in a Registration Rights Agreement.
"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) or issues
preferred stock subsequent to the commencement of the period for which the Fixed
Charge Coverage Ratio is being calculated but prior to the date on which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect
to such incurrence, assumption, guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for
purposes of making the computation referred to above, (i) acquisitions that have
been made by the referent Person or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date (including, without
limitation, any acquisition to occur on the Calculation Date) shall be deemed to
have occurred on the first day of the four-quarter reference period and
Consolidated Cash Flow for such reference period shall be calculated without
giving effect to clause (iii) of the proviso set forth in the definition of
Consolidated Net Income, (ii) the net proceeds of Indebtedness incurred or
Disqualified Stock issued by the referent Person pursuant to the first paragraph
of Section 4.09 hereof during the four-quarter reference period or subsequent to
such reference period and on or prior to the Calculation Date shall be deemed to
have been received by the referent Person or any of its Restricted Subsidiaries
on the first day of the four-quarter reference period and applied to its
intended use on such date, (iii) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded and
(iv) the Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such Fixed Charges shall not be obligations of the referent
Person or any of its Restricted Subsidiaries following the Calculation Date.
8
"Fixed Charges" means, with respect to any Person for any period, the
sum, without duplication, of (i) the consolidated interest expense of such
Person and its Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Interest Rate Hedging Agreements); (ii) the consolidated interest expense of
such Person and its Restricted Subsidiaries that was capitalized during such
period; (iii) any interest expense on Indebtedness of another Person that is
guaranteed by such Person or any of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or any of its Restricted Subsidiaries (whether or
not such guarantee or Lien is called upon) and (iv) the product of (a) all cash
dividend payments (and non-cash dividend payments in the case of a Person that
is a Restricted Subsidiary) on any series of preferred stock of such Person or
any of its Restricted Subsidiaries, times (b) a fraction, the numerator of which
is one and the denominator of which is one minus the then current combined
federal, state and local statutory tax rate of such Person, expressed as a
decimal, in each case, on a consolidated basis and in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the date hereof.
"Global Note" means a Note in registered global form without interest
coupons.
"Government Securities" means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such Government
Security or a specific payment of principal of or interest on any such
Government Security held by such custodian for the account of the holder of such
depositary receipt; provided, that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depositary receipt from any amount received by the custodian in respect of
the Government Security or the specific payment of principal of or interest on
the Government Security evidenced by such depositary receipt.
"guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
9
"Guarantee" means each of the Guarantees of the Notes by the
Subsidiary Guarantors hereunder.
"Holder" means a Person in whose name a Note is registered on the
Registrar's books.
"Indebtedness" means, with respect to any Person, without
duplication, (a) any indebtedness of such Person, whether or not contingent, (i)
in respect of borrowed money, (ii) evidenced by bonds, notes, debentures or
similar instruments, (iii) evidenced by letters of credit (or reimbursement
agreements in respect thereof) or banker's acceptances, (iv) representing
Capital Lease Obligations, (v) representing the balance deferred and unpaid of
the purchase price of any property, except any such balance that constitutes an
accrued expense or trade payable, (vi) representing any obligations in respect
of Interest Rate Hedging Agreements or Oil and Gas Hedging Contracts, and (vii)
in respect of any Production Payment, (b) all indebtedness of others secured by
a Lien on any asset of such Person (whether or not such indebtedness is assumed
by such Person), (c) obligations of such Person in respect of production
imbalances, (d) Attributable Debt of such Person, and (e) to the extent not
otherwise included in the foregoing, the guarantee by such Person of any
indebtedness of any other Person; provided that the indebtedness described in
clauses (a) (i), (ii), (iv) and (v) shall be included in this definition of
Indebtedness only if, and to the extent that, the indebtedness described in such
clauses would appear as a liability upon a balance sheet of such Person prepared
in accordance with GAAP.
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Initial Additional Notes" means Additional Notes issued in an
offering not registered under the Securities Act and any Notes issued in
replacement thereof, but not including any Exchange Notes issued in exchange
therefor.
"Initial Notes" means the Notes issued on the Closing Date and any
Notes issued in replacement thereof, but not including any Exchange Notes issued
in exchange therefor.
"Initial Purchasers" means the initial purchasers party to a purchase
agreement with the Company relating to the sale of the Initial Notes or Initial
Additional Notes by the Company.
"interest", in respect of the Notes, unless the context otherwise
requires, refers to interest and Liquidated Damages, if any.
"Interest Rate Hedging Agreements" means, with respect to any Person,
the obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the form of direct or
indirect loans (including guarantees of Indebtedness or other obligations, but
excluding trade credit and other ordinary course advances customarily made in
the oil and gas industry), advances or capital contributions (excluding
commission, travel and similar advances to officers and employees made in the
ordinary course of business), purchases or other acquisitions for consideration
of Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a
10
balance sheet prepared in accordance with GAAP; provided that the following
shall not constitute Investments: (i) an acquisition of assets, Equity Interests
or other securities by the Company for consideration consisting of common equity
securities of the Company, (ii) Interest Rate Hedging Agreements entered into in
accordance with the limitations set forth in clause (g) of the definition of
"Permitted Indebtedness" set forth in Section 4.09 hereof, (iii) Oil and Gas
Hedging Contracts entered into in accordance with the limitations set forth in
clause (h) of the definition of "Permitted Indebtedness" set forth in Section
4.09 hereof and (iv) endorsements of negotiable instruments and documents in the
ordinary course of business. If the Company or any Restricted Subsidiary of the
Company sells or otherwise disposes of any Equity Interests of any direct or
indirect Restricted Subsidiary of the Company such that, after giving effect to
any such sale or disposition, such Person is no longer a Subsidiary of the
Company, the Company shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the fair market value of the Equity
Interests of such Subsidiary not sold or disposed of.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, the City of Chicago, the City of Houston,
Texas or at a place of payment are authorized by law, regulation or executive
order to remain closed. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction other
than a precautionary financing statement with respect to a lease not intended as
a security agreement).
"Liquidated Damages" means liquidated damages owed to the Holders
pursuant to a Registration Rights Agreement.
"Material Change" means an increase or decrease (excluding changes
that result solely from changes in prices) of more than 20% during a fiscal
quarter in the estimated discounted future net cash flows from proved oil and
gas reserves of the Company and its Restricted Subsidiaries, calculated in
accordance with clause (i) (a) of the definition of Adjusted Consolidated Net
Tangible Assets; provided, however, that the following will be excluded from the
calculation of Material Change; (i) any acquisitions during the quarter of oil
and gas reserves that have been estimated by one or more nationally recognized
firms of independent petroleum engineers and on which a report or reports exist
and (ii) any disposition of properties existing at the beginning of such quarter
that have been disposed of as provided in Section 4.10 hereof.
"Moody's" means Moody's Investors Service, Inc. and its successors.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including,
11
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 received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale, but
excluding cash amounts placed in escrow, until such amounts are released to the
Company), net of the direct costs relating to such Asset Sale (including,
without limitation, legal, accounting and investment banking fees and expenses,
and sales commissions) and any relocation expenses incurred as a result thereof,
taxes paid or payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements), amounts
required to be applied to the repayment of Indebtedness (other than Indebtedness
under any Credit Facility) secured by a Lien on the asset or assets that were
the subject of such Asset Sale and any reserve for adjustment in respect of the
sale price of such asset or assets established in accordance with GAAP and any
reserve established for future liabilities.
"Net Working Capital" means (i) all current assets of the Company and
its Restricted Subsidiaries, minus (ii) all current liabilities of the Company
and its Restricted Subsidiaries, except current liabilities included in
Indebtedness, in each case as set forth in financial statements of the Company
prepared in accordance with GAAP (excluding any adjustments made pursuant to the
Financial Accounting Standards Board's Statement of Financial Accounting
Standards No. 133).
"Non-Recourse Debt" means Indebtedness (i) as to which neither the
Company nor any of its Restricted Subsidiaries (a) provides any guarantee or
credit support of any kind (including any undertaking, guarantee, indemnity or
agreement or instrument that would constitute Indebtedness) or (b) is directly
or indirectly liable (as a guarantor or otherwise); (ii) no default with respect
to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any of its Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity; and (iii) the explicit terms of which provide that there is
no recourse against any of the assets of the Company or its Restricted
Subsidiaries.
"Non-U.S. Person" means a Person that is not a U.S. person, as
defined in Regulation S.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Notes by the Company.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the
12
Treasurer, any Assistant Treasurer, the Controller, the Secretary, the Assistant
Secretary, any Vice-President of such Person or any other individual designated
in writing by such Person as an Officer.
"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.
"Offshore Global Note" means a Global Note representing Notes issued
and sold pursuant to Regulation S.
"Oil and Gas Business" means (i) the acquisition, exploration,
development, operation and disposition of interests in oil, gas and other
hydrocarbon properties, (ii) the gathering, marketing, distribution, treating,
processing, storage, selling and transporting of any production from such
interests or properties, (iii) any business relating to exploration for or
development, production, treatment, processing, storage, transportation or
marketing of oil, gas and other minerals and products produced in association
therewith and (iv) any activity that is ancillary to or necessary or appropriate
for the activities described in clauses (i) through (iii) of this definition.
"Oil and Gas Hedging Contracts" means any oil and gas purchase or
hedging agreement, and other agreement or arrangement, in each case, that is
designed to provide protection against oil and gas price fluctuations.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
12.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary Guarantor or the Trustee.
"Original Notes" means the Initial Notes and any Exchange Notes
issued in exchange therefor.
"pari passu Indebtedness" means indebtedness which ranks pari passu
in right of payment to the Notes.
"Paying Agent" refers to a Person engaged to perform the obligations
of the Trustee in respect of payments made or funds held hereunder in respect of
the Notes.
"Permanent Offshore Global Note" means an Offshore Global Note that
does not bear the Temporary Offshore Global Note Legend.
"Permitted Investments" means (a) any Investment in the Company or in
a Wholly Owned Restricted Subsidiary of the Company; (b) any Investment in Cash
Equivalents or securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality thereof having
maturities of not more than one year from the date of acquisition; (c) any
Investment by the Company or any Restricted Subsidiary of the Company in a
Person if, as a result of such Investment and any related transactions that at
the time of such Investment are contractually mandated to occur, (i) such Person
becomes a Wholly Owned
13
Restricted Subsidiary of the Company or (ii) such Person is merged, consolidated
or amalgamated with or into, or transfers or conveys all or substantially all of
its assets to, or is liquidated into, the Company or a Wholly Owned Restricted
Subsidiary of the Company; (d) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10 hereof; (e) other Investments in any Person or
Persons having an aggregate fair market value (measured on the date each such
Investment was made and without giving effect to subsequent changes in value),
when taken together with all other Investments made pursuant to this clause (e)
that are at the time outstanding not to exceed $10.0 million; (f) any Investment
acquired by the Company in exchange for Equity Interests in the Company (other
than Disqualified Stock); (g) shares of Capital Stock received in connection
with any good faith settlement of a bankruptcy proceeding involving a trade
creditor; (h) entry into operating agreements, joint ventures, partnership
agreements, working interests, royalty interests, mineral leases, processing
agreements, farm-out agreements, contracts for the sale, transportation or
exchange of oil and natural gas, unitization agreements, pooling arrangements,
area of mutual interest agreements, production sharing agreements or other
similar or customary agreements, transactions, properties, interests or
arrangements, and Investments and expenditures in connection therewith or
pursuant thereto, in each case made or entered into the ordinary course of the
Oil and Gas Business, excluding, however, Investments in corporations other than
any Investment received pursuant to the Asset Sale provision and (i) the
acquisition of any Equity Interests pursuant to a transaction of the type
described in clause (6) of the exclusion from the definition of "Asset Sale".
"Permitted Liens" means (i) Liens securing Indebtedness of a
Subsidiary or Liens securing Senior Debt, in each case, that is outstanding on
the date of issuance of the Notes and Liens securing Senior Debt that are
permitted by the terms of this Indenture to be incurred, (ii) Liens in favor of
the Company, (iii) Liens on property or assets existing at the time of
acquisition thereof by the Company or any Subsidiary of the Company and Liens on
property or assets of a Subsidiary existing at the time it became a Subsidiary,
provided, that such Liens were in existence prior to the contemplation of the
acquisition and do not extend to any assets other than the acquired property,
(iv) Liens incurred or deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other kinds of
social security, or to secure the payment or performance of tenders, statutory
or regulatory obligations, surety or appeal bonds, performance bonds or other
obligations of a like nature incurred in the ordinary course of business
(including lessee or operator obligations under statutes, governmental
regulations or instruments related to the ownership, exploration and production
of oil, gas and minerals on state or federal lands or waters), (v) Liens
existing on the date of this Indenture, (vi) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded, provided that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor,
(vii) statutory liens of landlords, mechanics, suppliers, vendors, warehousemen,
carriers or other like Liens arising in the ordinary course of business, (viii)
judgment Liens not giving rise to an Event of Default so long as any appropriate
legal proceeding that may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within which such
proceeding may be initiated shall not have expired, (ix) Liens on, or related
to, properties or assets to secure all or part of the costs incurred in the
ordinary course of the Oil and Gas Business for the exploration, drilling,
development or operation thereof, (x) Liens in pipelines or pipeline facilities
that arise
14
under operation of law, (xi) Liens arising under operating agreements, joint
venture agreements, partnership agreements, oil and gas leases, farm-out
agreements, division orders, contracts for the sale, transportation or exchange
of oil or natural gas, unitization and pooling declarations and agreements, area
of mutual interest agreements and other agreements that are customary in the Oil
and Gas Business, (xii) Liens reserved in oil and gas mineral leases for bonus
and rental payments and for compliance with the terms of such leases, (xiii)
Liens securing the Notes and (xiv) Liens not otherwise permitted by clauses (i)
through (xiii) that are incurred in the ordinary course of business of the
Company or any Subsidiary of the Company with respect to obligations that do not
exceed $5.0 million at any one time outstanding.
"Permitted Refinancing Debt" means any Indebtedness of the Company or
any of its Restricted Subsidiaries issued in exchange for, or the net proceeds
of which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness (other than Indebtedness incurred under a Credit Facility) of the
Company or any of its Restricted Subsidiaries; provided that: (i) the principal
amount of such Permitted Refinancing Debt does not exceed the principal amount
of the Indebtedness so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of reasonable expenses incurred in connection
therewith); (ii) such Permitted Refinancing Debt has a final maturity date on or
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; (iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Permitted Refinancing Debt has a final maturity date later than the final
maturity date of, and is subordinated in right of payment to, the Notes on terms
at least as favorable taken as a whole to the Holders of the Notes as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and (iv) such Indebtedness
is incurred either by the Company or by the Restricted Subsidiary who is the
obligor on the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Production Payments" means Dollar-Denominated Production Payments
and Volumetric Production Payments, collectively.
"Registrar" means a Person engaged to maintain the Register.
"Registration Rights Agreement" means (i) the Registration Rights
Agreement dated on or about the Closing Date between the Company and the Initial
Purchasers party thereto with respect to the Initial Notes, and (ii) with
respect to any Additional Notes, any registration rights agreements between the
Company and the Initial Purchasers party thereto relating to rights given by the
Company to the purchasers of Additional Notes to register such Additional Notes
or exchange them for Notes registered under the Securities Act.
"Regulation S" means Regulation S under the Securities Act.
15
"Regulation S Certificate" means a certificate substantially in the
form of Exhibit E hereto.
"Repurchase Offer" means an offer made by the Company to purchase all
or any portion of a Holder's Notes pursuant to Section 4.10 or 4.13 hereof.
"Responsible Officer" when used with respect to the Trustee, means
the officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) having direct responsibility for the
administration of this Indenture.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Legend" means the legend set forth in Exhibit C.
"Restricted Period" means the relevant 40-day distribution compliance
period as defined in Regulation S.
"Restricted Subsidiary" means any direct or indirect Subsidiary of
the Company that is not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Certificate" means (i) a certificate substantially in the
form of Exhibit F hereto or (ii) a written certification addressed to the
Company and the Trustee to the effect that the Person making such certification
(x) is acquiring such Note (or beneficial interest) for its own account or one
or more accounts with respect to which it exercises sole investment discretion
and that it and each such account is a qualified institutional buyer within the
meaning of Rule 144A, (y) is aware that the transfer to it or exchange, as
applicable, is being made in reliance upon the exemption from the provisions of
Section 5 of the Securities Act provided by Rule 144A, and (z) acknowledges that
it has received such information regarding the Company as it has requested
pursuant to Rule 144A(d)(4) or has determined not to request such information.
"S&P" means Standard & Poor's Ratings Group and its successors.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in a Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article I, Rule 1.02 of Regulations S-X,
promulgated pursuant to the Exchange Act, as such Regulation is in effect on the
date hereof.
"Subordinated Indebtedness" means any Indebtedness of the Company or
any Restricted Subsidiary (whether outstanding on the date of the issuance of
the Notes or thereafter incurred) which is subordinate or junior in right of
payment to the Notes pursuant to a written agreement.
16
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
"Subsidiary Guarantors" means each Restricted Subsidiary of the
Company existing on the date hereof (such subsidiaries being PMOG Holdings,
Inc., Range Energy I, Inc., Range HoldCo, Inc., Range Production Company, Range
Energy Ventures Corporation, Gulfstar Energy, Inc., Range Energy Finance
Corporation and RB Operating Company) and any other future Restricted Subsidiary
of the Company and in each case their respective successors and assigns;
provided that in no event shall any Subsidiary acquired by the Company after the
date of this Indenture that is organized under the laws of a jurisdiction other
than the United States or any State or other subdivision thereof (a "non-U.S.
Subsidiary") be a Subsidiary Guarantor under this Indenture.
"Temporary Offshore Global Note" means an Offshore Global Note that
bears the Temporary Offshore Global Note Legend.
"Temporary Offshore Global Note Legend" means the legend set forth in
Exhibit H.
"TIA" means the Trust Indenture Act of 1939, as amended, as in effect
on the date on which this Indenture is qualified under the TIA.
"Total Assets" means, with respect to any Person, the total
consolidated assets of such Person and its Restricted Subsidiaries, as shown on
the most recent balance sheet of such Person.
"Trustee" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
which at the time of determination shall be an Unrestricted Subsidiary (as
designated by the Board of Directors of the Company, as provided below) and (ii)
any Subsidiary of an Unrestricted Subsidiary. The Board of Directors of the
Company may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary or a Person becoming a Subsidiary through
merger or consolidation or Investment therein) to be an Unrestricted Subsidiary
only if: (a) such Subsidiary does not own any Capital Stock of, or own or hold
any Lien on any property of, any other Subsidiary of the Company which is not a
Subsidiary of the Subsidiary to be so designated or otherwise an Unrestricted,
Subsidiary; (b) all the Indebtedness of such Subsidiary shall at the date of
designation, and will at all times thereafter consist of, Non-Recourse Debt; (c)
the Company certifies that such designation was permitted by Section 4.07; (d)
such Subsidiary, either alone or in the aggregate with all other Unrestricted
Subsidiaries, does not operate, directly or indirectly, all or substantially all
of the business of the Company and its Subsidiaries; (e) such
17
Subsidiary does not, directly or indirectly, own any Indebtedness of or Equity
Interest in, and has no Investments in, the Company or any Restricted
Subsidiary; (f) such Subsidiary is a Person with respect to which neither the
Company nor any of its Restricted Subsidiaries has any direct or indirect
obligation (1) to subscribe for additional Equity Interests or (2) to maintain
or preserve such Person's financial condition or to cause such Person to achieve
any specified levels of operating results; and (g) on the date such Subsidiary
is designated an Unrestricted Subsidiary, such Subsidiary is not a party to any
agreement, contract, arrangement or understanding with the Company or any
Restricted Subsidiary with terms substantially less favorable to the Company
than those that might have been obtained from Persons who are not Affiliates of
the Company. Any such designation by the Board of Directors of the Company shall
be evidenced to the Trustee by filing with the Trustee a resolution of the Board
of Directors of the Company giving effect to such designation and an Officer's
Certificate certifying that such designation complied with the foregoing
conditions. If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred as of such date.
The Board of Directors of the Company may designate any Unrestricted Subsidiary
to be a Restricted Subsidiary; provided that (1) immediately after giving effect
to such designation, no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof and the Company could incur
at least $1.00 of additional Indebtedness (excluding Permitted Indebtedness)
pursuant to Section 4.09 on a pro forma basis taking into account such
designation and (2) such Subsidiary executes a Guarantee pursuant to Section
11.04 of this Indenture.
"U.S. Global Note" means a Global Note that bears the Restricted
Legend representing Notes issued and sold pursuant to Rule 144A.
"Volumetric Production Payments" means production payment obligations
recorded as deferred revenue in accordance with GAAP, together with all
undertakings and obligations in connection therewith.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" means, with respect to any
Person, a Restricted Subsidiary of such Person, all of the outstanding Capital
Stock or other ownership interests of which (other than directors' qualifying
shares) are owned, directly or indirectly, by such Person or by one or more
Wholly Owned Restricted Subsidiaries of such Person.
Section 1.02. Other Definitions.
18
Term Defined in Section
"Affiliate Transaction"............................................................. 4.11
"Asset Sale Offer".................................................................. 3.09
"Bankruptcy Law".................................................................... 10.02
"Change of Control Offer"........................................................... 4.13
"Change of Control Payment"......................................................... 4.13
"Change of Control Payment Date".................................................... 4.13
"Covenant Defeasance"............................................................... 8.03
"Custodian"......................................................................... 6.01
"Event of Default".................................................................. 6.01
"Excess Proceeds"................................................................... 4.10
"incur"............................................................................. 4.09
"Legal Defeasance".................................................................. 8.02
"Notice of Default"................................................................. 6.01
"Offer Amount"...................................................................... 3.09
"Offer Period"...................................................................... 3.09
"Payment Blockage Notice"........................................................... 10.04
"Payment Default"................................................................... 6.01
"Permitted Indebtedness"............................................................ 4.09
"Purchase Date"..................................................................... 3.09
"Register".......................................................................... 2.09
"Representative".................................................................... 10.02
"Restricted Payments"............................................................... 4.07
"Senior Debt"....................................................................... 10.02
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 to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" with respect to the Notes means the Company and with
respect to the Guarantees means the Subsidiary Guarantors and any successor
obligor upon the Notes and the Guarantees, respectively.
All other terms used in this indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by rule enacted by the
Commission under the TIA have the meanings so assigned to them.
19
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the Commission from time to time.
ARTICLE 2
THE NOTES
Section 2.01. Form, Dating and Denominations 144A, Reg S; Legends
144A, Reg S.
(a)The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto, the terms of which are
incorporated herein and made part of this Indenture. The Guarantees of the
Subsidiary Guarantors shall be substantially in the form of Exhibit I hereto,
the terms of which are incorporated in and made part of this indenture. The
Notes may have notations, legends or endorsements required by law, stock
exchange rule or usage. Each Note shall be dated the date of its issuance and
shall show the date of its authentication. The Notes will be fully registered as
to principal and interest in minimum denominations of $1,000 and integral
multiples of $1,000 in excess thereof.
(b) (1) Except as otherwise provided in paragraph (c), Section
2.10(b)(3), (b)(5), or (c) or Section 2.09(b)(4), each Initial Note or Initial
Additional Note (other than a Permanent Offshore Global Note) will bear the
Restricted Legend.
(2) Each Global Note, whether or not an Initial Note or
Additional Note, will bear the DTC Legend.
(3) Each Temporary Offshore Global Note will bear the
Temporary Offshore Global Note Legend.
(4) Initial Notes and Initial Additional Notes offered and
sold in reliance on Regulation S will be issued as provided in
Section 2.11(a).
20
(5) Initial Notes and Initial Additional Notes offered and
sold in reliance on any exception under the Securities Act other than
Regulation S and Rule 144A will be issued, and upon the request of
the Company to the Trustee, Initial Notes offered and sold in
reliance on Rule 144A may be issued, in the form of Certificated
Notes.
(6) Exchange Notes will be issued, subject to Section
2.09(b), in the form of one or more Global Notes.
(c) (1) If the Company determines (upon the advice of counsel and
such other certifications and evidence as the Company may reasonably require)
that a Note is eligible for resale pursuant to Rule 144(k) under the Securities
Act (or a successor provision) and that the Restricted Legend is no longer
necessary or appropriate in order to ensure that subsequent transfers of the
Note (or a beneficial interest therein) are effected in compliance with the
Securities Act, or
(2) after an Initial Note or any Initial Additional Note
is
(x) sold pursuant to an effective registration
statement under the Securities Act, pursuant to the
Registration Rights Agreement or otherwise, or (y) is
validly tendered for exchange into an Exchange Note
pursuant to an Exchange Offer
the Company may instruct the Trustee to cancel the Note and issue to the Holder
thereof (or to its transferee) a new Note of like tenor and amount, registered
in the name of the Holder thereof (or its transferee), that does not bear the
Restricted Legend, and the Trustee will comply with such instruction.
(d) By its acceptance of any Note bearing the Restricted Legend (or
any beneficial interest in such a Note), each Holder thereof and each owner of a
beneficial interest therein acknowledges the restrictions on transfer of such
Note (and any such beneficial interest) set forth in this Indenture and in the
Restricted Legend and agrees that it will transfer such Note (and any such
beneficial interest) only in accordance with the Indenture and such legend.
Section 2.02. Execution and Authentication; Exchange Notes;
Additional Notes.
(a) An Officer shall execute the Notes for the Company by facsimile
or manual signature in the name and on behalf of the Company. If an Officer
whose signature is on a Note no longer holds that office at the time the Note is
authenticated, the Note will still be valid.
(b) A Note will not be valid until the Trustee manually signs the
certificate of authentication on the Note, with the signature conclusive
evidence that the Note has been authenticated under the Indenture.
(c) At any time and from time to time after the execution and
delivery of the Indenture, the Company may deliver Notes executed by the Company
to the Trustee for authentication. The Trustee will authenticate and deliver
21
(i) Initial Notes for original issue in the aggregate
principal amount not to exceed $150,000,000,
(ii) Initial Additional Notes from time to time for
original issue in aggregate principal amounts specified by the
Company, and
(iii) Exchange Notes from time to time for issue in
exchange for a like principal amount of Initial Notes or Initial
Additional Notes
after the following conditions have been met:
(1) Receipt by the Trustee of an Officers' Certificate
specifying
(A) the amount of Notes to be authenticated and
the date on which the Notes are to be authenticated,
(B) whether the Notes are to be Initial Notes
or Additional Notes or Exchange Notes,
(C) in the case of Initial Additional Notes,
that the issuance of such Notes does not contravene any
provision of Article 4,
(D) whether the Notes are to be issued as one
or more Global Notes or Certificated Notes, and
(E) other information the Company may determine
to include or the Trustee may reasonably request.
(2) In the case of Initial Additional Notes, receipt by
the Trustee of an Opinion of Counsel confirming that the Holders of
the outstanding Notes will be subject to federal income tax in the
same amounts, in the same manner and at the same times as would have
been the case if such Additional Notes were not issued.
(3) In the case of Exchange Notes, effectiveness of an
Exchange Offer Registration Statement and consummation of the
exchange offer thereunder (and receipt by the Trustee of an Officers'
Certificate to that effect). Initial Notes or Initial Additional
Notes exchanged for Exchange Notes will be cancelled by the Trustee.
Section 2.03. Registrar, Paying Agent and Authenticating Agent;
Paying Agent to Hold Money in Trust.
(a) The Company may appoint one or more Registrars and one or more
Paying Agents, and the Trustee may appoint an Authenticating Agent, in which
case each reference in the Indenture to the Trustee in respect of the
obligations of the Trustee to be performed by that Agent will be deemed to be
references to the Agent. The Company may act as Registrar or (except for
purposes of Article 8) Paying Agent. In each case the Company and the Trustee
will enter into an appropriate agreement with the Agent implementing the
provisions of the Indenture
22
relating to the obligations of the Trustee to be performed by the Agent and the
related rights. The Company initially appoints the Trustee as Registrar and
Paying Agent.
(b) The Company will require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent will hold in trust for the benefit of
the Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or of interest on the Notes and will promptly notify
the Trustee of any default by the Company in making any such payment. The
Company at any time may require a Paying Agent to pay all money held by it to
the Trustee and account for any funds disbursed, and the Trustee may at any time
during the continuance of any payment default, upon written request to a Paying
Agent, require the Paying Agent to pay all money held by it to the Trustee and
to account for any funds disbursed. Upon doing so, the Paying Agent will have no
further liability for the money so paid over to the Trustee.
Section 2.04. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if a Holder
claims that its Note has been lost, destroyed or wrongfully taken, the Company
will issue and the Trustee will authenticate a replacement Note of like tenor
and principal amount and bearing a number not contemporaneously outstanding.
Every replacement Note is an additional obligation of the Company and entitled
to the benefits of the Indenture. If required by the Trustee or the Company, an
indemnity must be furnished that is sufficient in the judgment of both the
Trustee and the Company to protect the Company and the Trustee from any loss
they may suffer if a Note is replaced. The Company may charge the Holder for the
expenses of the Company and the Trustee in replacing a Note. In case the
mutilated, lost, destroyed or wrongfully taken Note has become or is about to
become due and payable, the Company in its discretion may pay the Note instead
of issuing a replacement Note.
Section 2.05. Outstanding Notes.
(a) Notes outstanding at any time are all Notes that have been
authenticated by the Trustee except for
(1) Notes cancelled by the Trustee or delivered to it for
cancellation;
(2) any Note which has been replaced pursuant to Section
2.04 unless and until the Trustee and the Company receive proof
satisfactory to them that the replaced Note is held by a bona fide
purchaser; and
(3) on or after the maturity date or any redemption date
or date for repurchase of the Notes pursuant to an Asset Sale Offer
or a Change of Control Offer, those Notes payable or to be redeemed
or repurchased on that date for which the Trustee (or Paying Agent,
other than the Company or an Affiliate of the Company) holds money
sufficient to pay all amounts then due.
(b) A Note does not cease to be outstanding because the Company or
one of its Affiliates holds the Note, provided that in determining whether the
Holders of the requisite principal amount of the outstanding Notes have given or
taken any request, demand,
23
authorization, direction, notice, consent, waiver or other action hereunder,
Notes owned by the Company or any Affiliate of the Company will be disregarded
and deemed not to be outstanding, (it being understood that in determining
whether the Trustee is protected in relying upon any such request, demand,
authorization, direction, notice, consent, waiver or other action, only Notes
which the Trustee knows to be so owned will be so disregarded). Notes so owned
which have been pledged in good faith may be regarded as outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Notes and that the pledgee is not the Company or any
Affiliate of the Company.
Section 2.06. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee will authenticate temporary Notes. Temporary Notes will
be substantially in the form of definitive Notes but may have insertions,
substitutions, omissions and other variations determined to be appropriate by
the Officer executing the temporary Notes, as evidenced by the execution of the
temporary Notes. If temporary Notes are issued, the Company will cause
definitive Notes to be prepared without unreasonable delay. After the
preparation of definitive Notes, the temporary Notes will be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
of the Company designated for the purpose pursuant to Section 4.02, without
charge to the Holder. Upon surrender for cancellation of any temporary Notes the
Company will execute and the Trustee will authenticate and deliver in exchange
therefor a like principal amount of definitive Notes of authorized
denominations. Until so exchanged, the temporary Notes will be entitled to the
same benefits under the Indenture as definitive Notes.
Section 2.07. Cancellation.
The Company at any time may deliver to the Trustee for cancellation
any Notes previously authenticated and delivered hereunder which the Company may
have acquired in any manner whatsoever, and may deliver to the Trustee for
cancellation any Notes previously authenticated hereunder which the Company has
not issued and sold. Any Registrar or the Paying Agent will forward to the
Trustee any Notes surrendered to it for transfer, exchange or payment. The
Trustee will cancel all Notes surrendered for transfer, exchange, payment or
cancellation and dispose of them in accordance with its document retention
procedures or the written instructions of the Company. The Company may not issue
new Notes to replace Notes it has paid in full or delivered to the Trustee for
cancellation.
Section 2.08. CUSIP and CINS Numbers.
The Company in issuing the Notes may use "CUSIP" and "CINS" numbers,
and the Trustee will use CUSIP numbers or CINS numbers in notices of redemption
or exchange or in Offers to Purchase as a convenience to Holders, the notice to
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 redemption or
exchange. The Company will promptly notify the Trustee of any change in the
CUSIP or CINS numbers.
24
Section 2.09. Registration, Transfer and Exchange.
(a) The Notes will be issued in registered form only, without coupons, and
the Company shall cause the Trustee to maintain a register (the "Register") of
the Notes, for registering the record ownership of the Notes by the Holders and
transfers and exchanges of the Notes.
(b) (1) Each Global Note will be registered in the name of the Depositary
or its nominee and, so long as DTC is serving as the Depositary thereof, will
bear the DTC Legend.
(2) Each Global Note will be delivered to the Trustee as custodian
for the Depositary. Transfers of a Global Note (but not a beneficial
interest therein) will be limited to transfers thereof in whole, but not
in part, to the Depositary, its successors or their respective nominees,
except (1) as set forth in Section 2.09(b)(4) and (2) transfers of
portions thereof in the form of Certificated Notes may be made upon
request of an Agent Member (for itself or on behalf of a beneficial owner)
by written notice given to the Trustee by or on behalf of the Depositary
in accordance with customary procedures of the Depositary and in
compliance with this Section and Section 2.10.
(3) Agent Members will have no rights under the Indenture with
respect to any Global Note held on their behalf by the Depositary, and the
Depositary shall be treated by the Company, the Trustee and any agent of
the Company or the Trustee as the absolute owner and Holder of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, the
Depositary or its nominee may grant proxies and otherwise authorize any
Person (including any Agent Member and any Person that holds a beneficial
interest in a Global Note through an Agent Member) to take any action
which a Holder is entitled to take under the Indenture or the Notes, and
nothing herein will impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the exercise of
the rights of a holder of any security.
(4) If (x) the Depositary notifies the Company that it is unwilling
or unable to continue as Depositary for a Global Note and a successor
depositary is not appointed by the Company within 90 days of the notice or
(y) an Event of Default has occurred and is continuing and the Trustee has
received a request from the Depositary, the Trustee will promptly exchange
each beneficial interest in the Global Note for one or more Certificated
Notes in authorized denominations having an equal aggregate principal
amount registered in the name of the owner of such beneficial interest, as
identified to the Trustee by the Depositary, and thereupon the Global Note
will be deemed canceled. If such Note does not bear the Restricted Legend,
then the Certificated Notes issued in exchange therefor will not bear the
Restricted Legend. If such Note bears the Restricted Legend, then the
Certificated Notes issued in exchange therefor will bear the Restricted
Legend, provided that any Holder of any such Certificated Note issued in
exchange for a beneficial interest in a Temporary Offshore Global Note
will have the right upon presentation to the Trustee of a duly completed
Certificate of Beneficial Ownership after the Restricted Period to
exchange such Certificated Note for a Certificated Note of like tenor and
amount that does not bear the Restricted Legend, registered in the name of
such Holder.
25
(c) Each Certificated Note will be registered in the name of the holder
thereof or its nominee.
(d) A Holder may transfer a Note (or a beneficial interest therein) to
another Person or exchange a Note (or a beneficial interest therein) for another
Note or Notes of any authorized denomination by presenting to the Trustee a
written request therefor stating the name of the proposed transferee or
requesting such an exchange, accompanied by any certification, opinion or other
document required by Section 2.10. The Trustee will promptly register any
transfer or exchange that meets the requirements of this Section by noting the
same in the register maintained by the Trustee for the purpose; provided that
(x) no transfer or exchange will be effective until it is registered
in such register and
(y) the Trustee will not be required (i) to issue, register the
transfer of or exchange any Note for a period of 15 days before a
selection of Notes to be redeemed or repurchased, (ii) to register the
transfer of or exchange any Note so selected for redemption or repurchase
in whole or in part, except, in the case of a partial redemption or
repurchase, that portion of any Note not being redeemed or repurchased, or
(iii) if a redemption or a repurchase is to occur after a regular record
date but on or before the corresponding related interest payment date, to
register the transfer of or exchange any Note on or after the regular
record date and before the date of redemption or repurchase. Prior to the
registration of any transfer, the Company, the Trustee and their agents
will treat the Person in whose name the Note is registered as the owner
and Holder thereof for all purposes (whether or not the Note is overdue),
and will not be affected by notice to the contrary.
From time to time the Company will execute and the Trustee will
authenticate additional Notes as necessary in order to permit the registration
of a transfer or exchange in accordance with this Section.
No service charge will be imposed in connection with any transfer or
exchange of any Note, 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 a transfer tax or other similar governmental charge
payable upon exchange pursuant to subsection (b)(4)).
(e) (1) Global Note to Global Note. If a beneficial interest in a Global Note is
transferred or exchanged for a beneficial interest in another Global Note, the
Trustee will (x) record a decrease in the principal amount of the Global Note
being transferred or exchanged equal to the principal amount of such transfer or
exchange and (y) record a like increase in the principal amount of the other
Global Note. Any beneficial interest in one Global Note that is transferred to a
Person who takes delivery in the form of an interest in another Global Note, or
exchanged for an interest in another Global Note, will, upon transfer or
exchange, cease to be an interest in such Global Note and become an interest in
the other Global Note and, accordingly, will thereafter be subject to all
transfer and exchange restrictions, if any, and other procedures applicable to
beneficial interests in such other Global Note for as long as it remains such an
interest.
26
(2) Global Note to Certificated Note. If a beneficial interest in a
Global Note is transferred or exchanged for a Certificated Note, the
Trustee will (x) record a decrease in the principal amount of such Global
Note equal to the principal amount of such transfer or exchange and (y)
deliver one or more new Certificated Notes in authorized denominations
having an equal aggregate principal amount to the transferee (in the case
of a transfer) or the owner of such beneficial interest (in the case of an
exchange), registered in the name of such transferee or owner, as
applicable.
(3) Certificated Note to Global Note. If a Certificated Note is
transferred or exchanged for a beneficial interest in a Global Note, the
Trustee will (x) cancel such Certificated Note, (y) record an increase in
the principal amount of such Global Note equal to the principal amount of
such transfer or exchange and (z) in the event that such transfer or
exchange involves less than the entire principal amount of the canceled
Certificated Note, deliver to the Holder thereof one or more new
Certificated Notes in authorized denominations having an aggregate
principal amount equal to the untransferred or unexchanged portion of the
canceled Certificated Note, registered in the name of the Holder thereof.
(4) Certificated Note to Certificated Note. If a Certificated Note
is transferred or exchanged for another Certificated Note, the Trustee
will (x) cancel the Certificated Note being transferred or exchanged, (y)
deliver one or more new Certificated Notes in authorized denominations
having an aggregate principal amount equal to the principal amount of such
transfer or exchange to the transferee (in the case of a transfer) or the
Holder of the canceled Certificated Note (in the case of an exchange),
registered in the name of such transferee or Holder, as applicable, and
(z) if such transfer or exchange involves less than the entire principal
amount of the canceled Certificated Note, deliver to the Holder thereof
one or more Certificated Notes in authorized denominations having an
aggregate principal amount equal to the untransferred or unexchanged
portion of the canceled Certificated Note, registered in the name of the
Holder thereof.
Section 2.10. Restrictions on Transfer and Exchange.
(a) The transfer or exchange of any Note (or a beneficial interest
therein) may only be made in accordance with this Section and Section 2.09 and,
in the case of a Global Note (or a beneficial interest therein), the applicable
rules and procedures of the Depositary. The Trustee shall refuse to register any
requested transfer or exchange that does not comply with the preceding sentence.
(b) Subject to paragraph (c), the transfer or exchange of any Note (or a
beneficial interest therein) of the type set forth in column A below for a Note
(or a beneficial interest therein) of the type set forth opposite in column B
below may only be made in compliance with the certification requirements (if
any) described in the clause of this paragraph set forth opposite in column C
below.
A B C
U.S. Global Note U.S. Global Note (1)
U.S. Global Note Offshore Global Note (2)
27
<Caption>
A B C
U.S. Global Note Certificated Note (3)
Offshore Global Note U.S. Global Note (4)
Offshore Global Note Offshore Global Note (1)
Offshore Global Note Certificated Note (5)
Certificated Note U.S. Global Note (4)
Certificated Note Offshore Global Note (2)
Certificated Note Certificated Note (3)
(1) No certification is required.
(2) The Person requesting the transfer or exchange must deliver or
cause to be delivered to the Trustee a duly completed Regulation S
Certificate; provided that if the requested transfer or exchange is made
by the Holder of a Certificated Note that does not bear the Restricted
Legend, then no certification is required.
(3) The Person requesting the transfer or exchange must deliver or
cause to be delivered to the Trustee (x) a duly completed Rule 144A
Certificate or (y) a duly completed Regulation S Certificate, and/or an
Opinion of Counsel and such other certifications and evidence as the
Company may reasonably require in order to determine that the proposed
transfer or exchange is being made in compliance with the Securities Act
and any applicable securities laws of any state of the United States;
provided that if the requested transfer or exchange is made by the Holder
of a Certificated Note that does not bear the Restricted Legend, then no
certification is required. In the event that (i) the requested transfer or
exchange takes place after the Restricted Period and a duly completed
Regulation S Certificate is delivered to the Trustee or (ii) a
Certificated Note that does not bear the Restricted Legend is surrendered
for transfer or exchange, upon transfer or exchange the Trustee will
deliver a Certificated Note that does not bear the Restricted Legend.
(4) The Person requesting the transfer or exchange must deliver or
cause to be delivered to the Trustee a duly completed Rule 144A
Certificate.
(5) Notwithstanding anything to the contrary contained herein, no
such exchange is permitted if the requested exchange involves a beneficial
interest in a Temporary Offshore Global Note. If the requested transfer
involves a beneficial interest in a Temporary Offshore Global Note, the
Person requesting the transfer must deliver or cause to be delivered to
the Trustee a duly completed Rule 144A Certificate and/or an Opinion of
Counsel and such other certifications and evidence as the Company may
reasonably require in order to determine that the proposed transfer is
being made in compliance with the Securities Act and any applicable
securities laws of any state of the United States. If the requested
transfer or exchange involves a beneficial interest in a Permanent
Offshore Global Note, no certification is required and the Trustee will
deliver a Certificated Note that does not bear the Restricted Legend.
(c) No certification is required in connection with any transfer or
exchange of any Note (or a beneficial interest therein)
28
(1) after such Note is eligible for resale pursuant to Rule 144(k)
under the Securities Act (or a successor provision); provided that the
Company has provided the Trustee with an Officer's Certificate to that
effect, and the Company may require from any Person requesting a transfer
or exchange in reliance upon this clause (1) an opinion of counsel and any
other reasonable certifications and evidence in order to support such
certificate; or
(2) (x) sold pursuant to an effective registration statement or (y)
which is validly tendered for exchange into an Exchange Note pursuant to
an Exchange Offer.
Any Certificated Note delivered in reliance upon this paragraph will not
bear the Restricted Legend.
(d) The Trustee will retain copies of all certificates, opinions and other
documents received in connection with the transfer or exchange of a Note (or a
beneficial interest therein), and the Company will have the right to inspect and
make copies thereof at any reasonable time upon written notice to the Trustee.
Section 2.11. Regulation S Temporary Offshore Global Notes.
(a) Each Note originally sold by the Initial Purchasers in reliance upon
Regulation S will be evidenced by one or more Offshore Global Notes that bear
the Temporary Offshore Global Note Legend.
(b) An owner of a beneficial interest in a Temporary Offshore Global Note
(or a Person acting on behalf of such an owner) may provide to the Trustee (and
the Trustee will accept) a duly completed Certificate of Beneficial Ownership at
any time after the Restricted Period (it being understood that the Trustee will
not accept any such certificate during the Restricted Period). Promptly after
acceptance of a Certificate of Beneficial Ownership with respect to such a
beneficial interest, the Trustee will cause such beneficial interest to be
exchanged for an equivalent beneficial interest in a Permanent Offshore Global
Note, and will (x) permanently reduce the principal amount of such Temporary
Offshore Global Note by the amount of such beneficial interest and (y) increase
the principal amount of such Permanent Offshore Global Note by the amount of
such beneficial interest.
(c) Notwithstanding paragraph (b), if after the Restricted Period any
Initial Purchaser owns a beneficial interest in a Temporary Offshore Global
Note, such Initial Purchaser may, upon written request to the Trustee
accompanied by a certification as to its status as an Initial Purchaser,
exchange such beneficial interest for an equivalent beneficial interest in a
Permanent Offshore Global Note, and the Trustee will comply with such request
and will (x) permanently reduce the principal amount of such Temporary Offshore
Global Note by the amount of such beneficial interest and (y) increase the
principal amount of such Permanent Offshore Global Note by the amount of such
beneficial interest.
(d) Notwithstanding anything to the contrary contained herein, no owner of
a beneficial interest in a Temporary Offshore Global Note shall be entitled to
receive payment of principal or interest on such beneficial interest or other
amounts in respect of such beneficial
29
interest until such beneficial interest is exchanged for an interest in a
Permanent Offshore Global Note or transferred for an interest in another Global
Note or a Certificated Note.
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 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.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, then it shall furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the redemption shall occur, (ii) the redemption
date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption
price.
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 or by such other method as the Trustee shall deem fair and appropriate (and
in such manner as complies with applicable legal requirements); provided that no
Notes of $1,000 or less shall be redeemed in part. In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption date by the Trustee from the outstanding Notes not previously called
for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. A new Note in principal amount equal to the
unredeemed portion thereof shall be
30
issued in the name of the Holder thereof upon cancellation of the original Note.
On and after the redemption date, unless the Company defaults in payment of the
redemption price, interest ceases to accrue on Notes or portions of them called
for redemption. Except as provided in this Section 3.02, 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.
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, the Company shall mail or cause to
be mailed, by first class mail, a notice of redemption to each Holder of Notes
to be redeemed at such Holder's registered address, provided, however, that the
Company shall provide notice to the Trustee pursuant to Section 3.01 hereof at
least three days (or such shorter period as shall be satisfactory to the
Trustee) prior to the mailing of the notice pursuant to this Section 3.03.
The notice shall identify the Notes 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 Notes or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption cease to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Notes.
If any of the Notes to be redeemed is in the form of a Global Note, then
such notice shall be modified in form but not substance to the extent
appropriate to accord with the procedures of the Depositary applicable to
redemptions.
31
At the Company's request and expense, the Trustee shall give the notice of
redemption in the Company's name; provided, however, that the Company shall have
delivered to the Trustee, at least 45 days (or such shorter period as shall be
satisfactory to the Trustee) 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.
On or prior to the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price of
and accrued interest on all Notes to be redeemed on that date. The Trustee or
the Paying Agent shall promptly return to the Company any money deposited with
the Trustee or the Paying Agent by the Company in excess of the amounts
necessary to pay the redemption price of and accrued interest on, all Notes to
be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not paid on
such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and, upon the receipt of a written authentication order of the Company signed by
two Officers of the Company, the Trustee shall authenticate for the Holder at
the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.07, the Company shall
not have the option to redeem the Notes pursuant to this Section 3.07 prior to
March 15, 2010. From and after March 15, 2010, the Company shall have the option
to redeem the Notes, in whole or in part, at the redemption prices (expressed as
percentages of principal amount) set forth below plus accrued and unpaid
interest thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on March 15 of each of the years indicated below:
32
Percentage of
Year Principal Amount
------------------------------------ ----------------
2010............................. 103.188%
2011............................. 102.125%
2012............................. 101.063%
2013 and thereafter.............. 100.000%
(b) Notwithstanding the provisions of clause (a) of this Section 3.07, at
any time prior to March 15, 2008, the Company may, at its option, on any one or
more occasions, redeem up to 35% of the original aggregate principal amount of
Notes at a redemption price equal to 106.375% of the principal amount thereof,
plus accrued and unpaid interest, if any, thereon to the redemption date with
all or a portion of the net proceeds of sales of public Equity Interests of the
Company; provided, that at least 65% of the original aggregate principal amount
of Notes remains outstanding immediately after the occurrence of such
redemption; and provided, further, that any such redemption shall occur within
60 days after the date of the closing of the related sale of such Equity
Interests.
(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 4.10 and 4.13 hereof, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to the Notes.
Section 3.09. 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 of Notes and, to the extent
required by the terms thereof, to all holders or lenders of other pari passu
Indebtedness, to repurchase Notes and any such pari passu Indebtedness (an
"Asset Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business Days
following its commencement and no longer, except to the extent that a longer
period is required by applicable law (the "Offer Period"). No later than five
Business Days after the termination of the Offer Period (the "Purchase Date"),
the Company shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.10 hereof, giving effect to any related offer
for pari passu Indebtedness pursuant to Section 4.10, (the "Offer Amount") or,
if less than the Offer Amount has been tendered, all Notes tendered in response
to the Asset Sale Offer. Payment for any Notes so purchased shall be made in the
same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no Liquidated Damages shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
33
Upon the commencement of an Asset Sale Offer, the Company shall send, by
first class mail, a notice to the Trustee and each of the Holders. The notice
shall contain all instructions and materials necessary to enable such Holders to
tender Notes pursuant to the Asset Sale Offer. The Asset Sale 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
accrue interest;
(d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest after the Purchase Date;
(e) that Holders electing to have a Note purchased pursuant to an Asset
Sale Offer may only elect to have all of such Note purchased and may not elect
to have only a portion of such Note purchased;
(f) that Holders electing to have a Note purchased pursuant to any Asset
Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, the Depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice at least
three Business Days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the 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 Company shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased) in the manner provided in
Section 4.10; and
(i) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
If any of the Notes subject to an Asset Sale Offer is in the form of a
Global Note, then such notice may be modified in form but not substance to the
extent appropriate to accord with the procedures of the Depositary applicable to
repurchases.
34
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 or the Paying Agent, as
the case may be, shall promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Company for purchase, and the Company shall promptly issue a new Note, and the
Trustee, upon receipt of a written authentication order of the Company signed by
two Officers of the Company shall authenticate and mail or deliver such new Note
to such Holder, in a principal amount equal to any unpurchased portion of the
Note surrendered. Any Note not so accepted shall be promptly mailed or delivered
by the Company to the Holder thereof. The Company shall publicly announce the
results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all such amounts then due.
The Company shall pay interest (including post-petition interest in any
proceeding under the Bankruptcy Code) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it shall pay interest (including post-petition interest in any
proceeding under the Bankruptcy Code) on overdue installments of interest
(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 principal, premium, if any, and
interest on the Notes will be paid and where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such
35
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.
Section 4.03. Reports.
Notwithstanding that the Company may not be required to remain subject to
the reporting requirements of Section 13 or 15(d) of the Exchange Act, to the
extent permitted by the Exchange Act, the Company shall file with the Commission
and provide, within 15 days after such filing, the Trustee and Holders and
prospective Holders (upon request) with the annual reports and the information,
documents and other reports that are specified in Sections 13 and 15(d) of the
Exchange Act (but without exhibits in the case of the Holders and prospective
Holders). In the event that the Company is not permitted to file such reports,
documents and information with the Commission, the Company will provide
substantially similar information to the Trustee, the Holders and prospective
Holders (upon request) as if the Company were subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act. The Company shall at
all times comply with TIA Section 314 (a).
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
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of, premium, if any, or interest on the
Notes is prohibited or if such event has occurred, a description of the event
and what action the Company is taking or proposes to take with respect thereto.
As of the date hereof, the Company's fiscal year ends on December 31 of each
calendar year. In the event the Company changes its fiscal year, it shall
promptly notify the Trustee of such change.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the fiscal year-end
financial statements delivered
36
pursuant to Section 4.03(a) above shall be accompanied by a written statement of
the Company's independent public accountants (who shall be a firm of established
national reputation) that in making the examination necessary for certification
of such financial statements, nothing has come to their attention that would
lead them to believe that the Company has violated any provisions of Article 4
or Article 5 hereof or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, within five Business Days of any Officer becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto.
Section 4.05. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws
Each of the Company and the Subsidiary Guarantors covenants (to the extent
that it may lawfully do so) that it shall not at any time insist upon, plead, or
in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and each of
the Company and the Subsidiary Guarantors (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law has been enacted.
Section 4.07. Restricted Payments.
The Company shall not and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make
any other payment or distribution on account of the Company's Equity Interests
(including, without limitation, any payment to holders of the Company's Equity
Interests in connection with any merger or consolidation involving the Company)
or to the direct or indirect holders of the Company's Equity Interests in their
capacity as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company); (ii) purchase, redeem
or otherwise acquire or retire for value any Equity Interests of the Company or
any direct or indirect parent or other Affiliate of the Company that is not a
Wholly Owned Restricted Subsidiary of the Company; (iii) make any principal
payment on, or purchase, redeem, defease or otherwise acquire or retire for
value any Indebtedness that is subordinated to the Notes, except at final
maturity; or (iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
37
referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be continuing
or would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Indebtedness pursuant to the 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 of all other
Restricted Payments made by the Company and its Restricted Subsidiaries after
the date of this Indenture (excluding Restricted Payments permitted by clauses
(2), (3), (5) and (6) of the next succeeding paragraph), is less than the sum of
(i) the dollar amount calculated as of March 9, 2005 under Section 4.07(c) of
that certain Indenture dated July 21, 2003 among the Company, the Subsidiary
Guarantors and J.P. Morgan Trust Company, National Association as successor
trustee to Bank One, National Association, plus (ii) 50% of the Consolidated Net
Income of the Company for the period (taken as one accounting period) from the
beginning of the first fiscal quarter commencing prior to the date of this
Indenture to the end of the Company's most recently ended fiscal quarter for
which internal financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a deficit, less
100% of such deficit), plus (iii) 100% of the aggregate net cash proceeds
received by the Company from the issue and sale since the date of this Indenture
of Equity Interests in the Company or of debt securities of the Company that
have been converted into or exchanged for such Equity Interests (other than
Equity Interests (or convertible debt securities) sold to a Subsidiary of the
Company and other than Disqualified Stock or debt securities that have been
converted into Disqualified Stock), plus (iv) to the extent that any Restricted
Investment that was made after the date of this Indenture is sold for cash or
otherwise liquidated or repaid for cash, the lesser of (A) the net proceeds of
such sale, liquidation or repayment and (B) the initial amount of such
Restricted Investment.
The foregoing provisions shall not prohibit (1) the payment of any
dividend within 60 days after the date of declaration thereof, if at said date
of declaration such payment would have complied with the provisions of this
Indenture; (2) the redemption, repurchase, retirement or other acquisition of
any Equity Interests of the Company in exchange for, or out of the proceeds of,
the substantially concurrent sale (other than to a Subsidiary of the Company) of
other Equity Interests of the Company (other than any Disqualified Stock);
provided that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement or other acquisition shall be excluded
from clause (c) (ii) of the preceding paragraph; (3) the defeasance, redemption
or repurchase of Subordinated Indebtedness with the net cash proceeds from an
incurrence of subordinated Permitted Refinancing Debt or the substantially
concurrent sale (other than to a Subsidiary of the Company) of Equity Interests
of the Company (other than Disqualified Stock); provided that the amount of any
such net cash proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (c) (ii) of the
preceding paragraph; (4) the repurchase, redemption or other acquisition or
38
retirement for value of any Equity Interests of the Company or any Subsidiary of
the Company held by any of the Company's (or any of its Subsidiaries') employees
pursuant to any management equity subscription agreement or stock option
agreement in effect as of the date of this Indenture; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests shall not exceed $2.0 million in any twelve-month period; and
provided further that no Default or Event of Default shall have occurred and be
continuing immediately after such transaction; (5) repurchases of Equity
Interests deemed to occur upon exercise of stock options if such Equity
Interests represent a portion of the exercise price of such options; and (6)
cash payments made by the Company for the repurchase, redemption or other
acquisition or retirement of the Company's 7 3/8% Senior Subordinated Notes due
2013.
The amount of all Restricted Payments (other than cash) shall be the fair
market value (as determined in good faith by a resolution of the Board of
Directors of the Company set forth in an Officers' Certificate delivered to the
Trustee, which determination shall be conclusive evidence of compliance with
this provision) on the date of the Restricted Payment of the asset(s) proposed
to be transferred by the Company or the applicable Restricted Subsidiary, as the
case may be, pursuant to the Restricted Payment. Not later than five days after
the date of making any Restricted Payment, the Company shall deliver to the
Trustee an Officers' Certificate stating that such Restricted Payment is
permitted and setting forth the basis upon which the calculations required by
this Section 4.07 were computed.
In computing Consolidated Net Income for purposes of this Section 4.07,
(i) the Company shall use audited financial statements for the portion of the
relevant period for which audited financial statements are available on the date
of determination and unaudited financial statements and other current financial
data based on the books and records of the Company for the remaining portion of
such period and (ii) the Company shall be permitted to rely in good faith on the
financial statements and other financial data derived from the books and records
of the Company that are available on the date of determination. If the Company
makes a Restricted Payment which, at the time of the making of such Restricted
Payment, would on the good faith determination of the Company be permitted under
the requirements of this Indenture, such Restricted Payment shall be deemed to
have been made in compliance with this Indenture notwithstanding any subsequent
adjustments made in good faith to the Company's financial statements affecting
Consolidated Net Income of the Company for any period.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Default. For
purposes of making such determination, all outstanding Investments by the
Company and its Restricted Subsidiaries (except to the extent repaid in cash) in
the Subsidiary so designated shall be deemed to be Restricted Payments at the
time of such designation and shall reduce the amount available for Restricted
Payments under clause (c) of the first paragraph of this covenant. All such
outstanding Investments shall be deemed to constitute Investments in an amount
equal to the greater of the fair market value or the book value of such
Investments at the time of such designation. Such designation shall only be
permitted if such Restricted Payment would be permitted at such time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
39
Section 4.08. Dividend and Other Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to (i) (x) pay dividends or make any other distributions
to the Company or any of its Restricted Subsidiaries (1) on its Capital Stock or
(2) with respect to any other interest or participation in, or measured by, its
profits, or (y) pay any indebtedness owed by it to the Company or any of its
Restricted Subsidiaries, (ii) make loans or advances to the Company or any of
its Restricted Subsidiaries or (iii) transfer any of its properties or assets to
the Company or any of its Restricted Subsidiaries, except for such encumbrances
or restrictions existing under or by reason of (a) the Credit Agreement as in
effect as of the date of this Indenture, and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings thereof or any other Credit Facility, provided that such
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements, refinancings or any other Credit Facilities are no
more restrictive taken as a whole with respect to such dividend and other
payment restrictions than those contained in the Credit Agreement as in effect
on the date of this Indenture, (b) this Indenture and the Notes, (c) applicable
law, (d) any instrument governing Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries as in effect at
the time of such acquisition (except, in the case of Indebtedness, to the extent
such Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person and its
Subsidiaries, or the property or assets of the Person and its Subsidiaries, so
acquired, provided that, in the case of Indebtedness, such Indebtedness was
permitted by the terms of this Indenture to be incurred, (e) by reason of
customary non-assignment provisions in leases and customary provisions in other
agreements that restrict assignment of such agreements or rights thereunder,
entered into in the ordinary course of business and consistent with past
practices, (f) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions of the nature described in clause
(iii) above on the property so acquired or (g) Permitted Refinancing Debt,
provided that the restrictions contained in the agreements governing such
Permitted Refinancing Debt are no more restrictive than those contained in the
agreements governing the Indebtedness being refinanced.
Section 4.09. Incurrence of Indebtedness and Issuance of Disqualified
Stock.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of preferred
stock; provided, however, that the Company may incur Indebtedness (including
Acquired Debt) or issue shares of Disqualified Stock if:
(i) the Fixed Charge Coverage Ratio for the Company's most recently
ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified
40
Stock is issued would have been at least 2.5 to 1, determined on a pro
forma basis as set forth in the definition of Fixed Charge Coverage Ratio;
and
(ii) no Default or Event of Default shall have occurred and be
continuing at the time such additional Indebtedness is incurred or such
Disqualified Stock is issued or would occur as a consequence of the
incurrence of the additional Indebtedness or the issuance of the
Disqualified Stock.
Notwithstanding the foregoing, this Indenture shall not prohibit any of
the following (collectively, "Permitted Indebtedness"): (a) the Indebtedness
evidenced by the Notes; (b) the Indebtedness evidenced by the 7 3/8% Senior
Subordinated Notes; (c) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness pursuant to Credit Facilities, so long as the
aggregate principal amount of all Indebtedness outstanding under all Credit
Facilities does not, at any one time, exceed the greater of (1) $600.0 million
(or, if there is any permanent reduction in the aggregate principal amount
permitted to be borrowed under the Credit Agreement, such lesser aggregate
principal amount) and (2) an amount equal to the sum of (x) $50 million plus (y)
30% of Adjusted Consolidated Net Tangible Assets determined after the incurrence
of such Indebtedness (including the application of the proceeds therefrom), (d)
the guarantee by any Subsidiary Guarantor of any Indebtedness that is permitted
by this Indenture to be incurred by the Company; (e) all Indebtedness of the
Company and its Restricted Subsidiaries in existence as of the date of this
Indenture; (f) intercompany Indebtedness between or among the Company and any of
its Wholly Owned Restricted Subsidiaries; provided, however, that (1) if the
Company is the obligor on such Indebtedness, such Indebtedness is expressly
subordinate to the payment in full of all Obligations with respect to the Notes
and (2) (A) any subsequent issuance or transfer of Equity Interests that results
in any such Indebtedness being held by a Person other than the Company or a
Wholly Owned Restricted Subsidiary and (B) any sale or other transfer of any
such Indebtedness to a Person that is not either the Company or a Wholly Owned
Restricted Subsidiary shall be deemed, in each case, to constitute an incurrence
of such Indebtedness by the Company or such Restricted Subsidiary, as the case
may be; (g) Indebtedness in connection with one or more standby letters of
credit, guarantees, performance bonds or other reimbursement obligations, in
each case, issued in the ordinary course of business and not in connection with
the borrowing of money or the obtaining of advances or credit (other than
advances or credit on open account, includible in current liabilities, for goods
and services in the ordinary course of business and on terms and conditions
which are customary in the Oil and Gas Business, and other than the extension of
credit represented by such letter of credit guarantee or performance bond
itself), not to exceed in the aggregate at any given time 5.0% of Total Assets;
(h) Indebtedness under Interest Rate Hedging Agreements entered into for the
purpose of limiting interest rate risks, provided that the obligations under
such agreements are related to payment obligations on Indebtedness otherwise
permitted by the terms of this covenant and that the aggregate notional
principal amount of such agreements does not exceed 105% of the principal amount
of the Indebtedness to which such agreements relate; (i) Indebtedness under Oil
and Gas Hedging Contracts, provided that such contracts were entered into in the
ordinary course of business for the purpose of limiting risks that arise in the
ordinary course of business of the Company and its Restricted Subsidiaries; (j)
the incurrence by the Company of Indebtedness not otherwise permitted to be
incurred pursuant to this paragraph, provided that the aggregate principal
amount (or accreted value, as applicable) of all Indebtedness incurred pursuant
to this clause (i), together with all Permitted Refinancing Debt incurred
pursuant to clause (k) of this
41
paragraph in respect of Indebtedness previously incurred pursuant to this clause
(i), does not exceed $10.0 million at any one time outstanding; (k) Permitted
Refinancing Debt incurred in exchange for, or the net proceeds of which are used
to refinance, extend, renew, replace, defease or refund, Indebtedness that was
permitted by this Indenture to be incurred (including Indebtedness previously
incurred pursuant to this clause (k)); (l) accounts payable or other obligations
of the Company or any Restricted Subsidiary to trade creditors created or
assumed by the Company or such Restricted Subsidiary in the ordinary course of
business in connection with the obtaining of goods or services; (m) Indebtedness
consisting of obligations in respect of purchase price adjustments, guarantees
or indemnities in connection with the acquisition or disposition of assets; and
(n) production imbalances that do not, at any one time outstanding, exceed 2% of
the Total Assets of the Company.
The Company shall not permit any of its Unrestricted Subsidiary to incur
any Indebtedness other than Non-Recourse Debt; provided, however, if any such
Indebtedness ceases to be Non-Recourse Debt, such event shall be deemed to
constitute an incurrence of Indebtedness by the Company.
Section 4.10. Asset Sales.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in an Asset Sale unless (i) the Company (or the
Restricted Subsidiary, as the case may be) receives consideration at the time of
such Asset Sale at least equal to the fair market value (as determined in good
faith by a resolution of the Board of Directors of the Company set forth in an
Officer's Certificate delivered to the Trustee, which determination shall be
conclusive evidence of compliance with this provision) of the assets or Equity
Interests issued or sold or otherwise disposed of and (ii) at least 85% of the
consideration therefor received by the Company or such Restricted Subsidiary in
such Asset Sale, plus all other Asset Sales since the date of this Indenture, on
a cumulative basis, is in the form of cash or Cash Equivalents; provided that
the amount of any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet), of the Company or any Restricted
Subsidiary (other than contingent liabilities and liabilities that are by their
terms subordinated to the Notes or any guarantee thereof) that are assumed by
the transferee of any such assets pursuant to a customary novation agreement
that releases the Company or such Restricted Subsidiary from further liability.
Within 360 days after the receipt of any Net Proceeds from an Asset Sale,
the Company may apply such Net Proceeds, at its option: (a) to reduce Senior
Debt, (b) to acquire controlling interests in another Oil and Gas Business, (c)
to make capital expenditures in respect of the Company's or its Restricted
Subsidiaries' Oil and Gas Business, (d) to purchase long-term assets that are
used or useful in such Oil and Gas Business or (e) to repurchase any Notes.
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce Senior Debt that is revolving debt or otherwise invest such
Net Proceeds in any manner that is not prohibited by this Indenture. Any Net
Proceeds from Asset Sales that are not applied as provided in the first sentence
of this paragraph shall (after the expiration of the periods specified in this
paragraph) be deemed to constitute "Excess Proceeds."
When the aggregate amount of Excess Proceeds exceeds $10.0 million, the
Company shall make an Asset Sale Offer to purchase the maximum principal amount
of Notes and any
42
other pari passu Indebtedness to which the Asset Sale Offer applies that may be
purchased out of the Excess Proceeds, at an offer price in cash in an amount
equal to, in the case of the Notes, 100% of the principal amount thereof plus
accrued and unpaid interest thereon to the date of purchase or, in the case of
any other pari passu Indebtedness, 100% of the principal amount thereof (or with
respect to discount pari passu Indebtedness, the accreted value thereof) on the
date of purchase, in each case, in accordance with the procedures set forth in
Section 3.09 hereof or the agreements governing pari passu Indebtedness, as
applicable. To the extent that the aggregate principal amount (or accreted
value, as the case may be) of the Notes and pari passu Indebtedness tendered
pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company
may use any remaining Excess Proceeds for general corporate purposes. If the sum
of (i) the aggregate principal amount of Notes surrendered by Holders thereof,
and (ii) the aggregate principal amount or accreted value, as the case may be,
of other pari passu Indebtedness surrendered by holders or lenders thereof,
exceeds the amount of Excess Proceeds, the Trustee and the trustee or other
lender representatives for the pari passu Indebtedness shall select the Notes
and other pari passu Indebtedness to be purchased on a pro rata basis, based on
the aggregate principal amount (or accreted value, as applicable) thereof
surrendered in such Asset Sale Offer. Upon completion of such Asset Sale Offer,
the Excess Proceeds shall be reset at zero.
Section 4.11. Transactions with Affiliates.
The Company shall not, and shall not permit any of its Subsidiaries to,
make any payment to, or sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
or make or amend any contract, agreement, understanding, loan, advance or
guarantee with, or for the benefit of, any of its Affiliates (each of the
foregoing, an "Affiliate Transaction"), unless (i) such Affiliate Transaction is
on terms that are no less favorable to the Company or the relevant Subsidiary
than those that would have been obtained in a comparable transaction by the
Company or such Subsidiary with an unrelated Person and (ii) the Company
delivers to the Trustee (a) with respect to an Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess of
$1,000,000 but less than or equal to $5,000,000, an Officers' Certificate to the
Trustee certifying that such Affiliate Transaction complies with clause (i)
above, (b) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of $5,000,000
but less than or equal to $10,000,000, a resolution of the Board of Directors
set forth in an Officer's Certificate certifying that such Affiliate Transaction
or series of related Affiliate Transactions complies with clause (i) above and
that such Affiliate Transaction or series of related Affiliate Transactions has
been approved in good faith by a majority of the members of the Board of
Directors of the Company who are disinterested with respect to such Affiliate
Transaction or series of related Affiliate Transactions (which resolution shall
be conclusive evidence of compliance with this provision) and (c) with respect
to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $10,000,000, a resolution of the
Board of Directors set forth in an Officers' Certificate certifying that such
Affiliate Transaction or series of related Affiliate Transactions complies with
clause (i) above and that such Affiliate Transaction or series of related
Affiliate Transactions has been approved in good faith by a resolution adopted
by a majority of the members of the Board of Directors of the Company who are
disinterested with respect to such Affiliate Transaction or series of related
Affiliate Transactions and an opinion as to the fairness to the Company or such
43
Subsidiary of such Affiliate Transaction or series of related Affiliate
Transactions from a financial point of view issued by an accounting, appraisal,
engineering or investment banking firm of national standing (which resolution
and fairness opinion shall be conclusive evidence of compliance with this
provision); provided, however, that the foregoing shall not apply to (l)
transactions contemplated by any employment agreement or other compensation plan
or arrangement entered into by the Company or any of its Subsidiaries in the
ordinary course of business and consistent with the past practice of the Company
or such Subsidiary, (2) transactions between or among the Company and/or its
Restricted Subsidiaries, (3) Permitted Investments and Restricted Payments that
are permitted by Section 4.07 hereof, and (4) any indemnification payment made
to any director, officer or employee of the Company or any Subsidiary pursuant
to charter, bylaw, statutory or contractual provisions.
Section 4.12. Liens.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, create, incur, assume or otherwise cause or suffer to exist or
become effective any Lien securing Indebtedness of any kind (other than
Permitted Liens) upon any of its property or assets, now owned or hereafter
acquired, unless all payments under the Notes are secured by such Lien prior to,
or on an equal and ratable basis with, the Indebtedness so secured for so long
as such Indebtedness is secured by such Lien.
Section 4.13. Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of the Notes shall
have the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the
offer described below (the "Change of Control Offer") at an offer price in cash
equal to 101% of the aggregate principal amount of the Notes plus accrued and
unpaid interest if any, thereon to the date of purchase (the "Change of Control
Payment"). Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder stating: (1) a description of the transaction or
transactions that constitute the Change of Control; (2) that the Change of
Control Offer is being made pursuant to this Section 4.13 and that all Notes
tendered shall be accepted for payment; (3) the purchase price and the purchase
date described below (the "Change of Control Payment Date"); (4) that any Note
not tendered shall continue to accrue interest, if any; (5) that, unless the
Company defaults in the payment of the Change of Control Payment, all Notes
accepted for payment pursuant to the Change of Control Offer shall cease to
accrue interest, if any, after the Change of Control Payment Date; (6) that
Holders electing to have any Notes purchased pursuant to a Change of Control
Offer shall be required to surrender the Notes, with the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Notes completed, to the
Paying Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Change of Control Payment Date;
(7) that Holders shall be entitled to withdraw their election if the Paying
Agent receives, not later than the close of business on the second Business Day
preceding the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of Notes delivered for purchase, and a statement that such Holder is
withdrawing his election to have the Notes purchased; and (8) that Holders whose
Notes are being purchased only in part shall be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered, which
unpurchased
44
portion must be equal to $1,000 in principal amount or an integral multiple
thereof. The Company and each Subsidiary Guarantor shall comply with the
requirements of Rule l4e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable to such party in connection with the repurchase of the Notes as a
result of a Change of Control.
(b) On a Business Day that is no earlier than 30 days nor later than 60
days from the date that the Company mails or causes to be mailed notice of the
Change of Control to the Holders (the "Change of Control Payment Date"), the
Company shall, to the extent lawful, (i) accept for payment all Notes or
portions thereof properly tendered pursuant to the Change of Control Offer, (ii)
deposit with the Paying Agent an amount equal to the Change of Control Payment
in respect of all the Notes or portions thereof so tendered and (iii) deliver or
cause to be delivered to the Trustee the Notes so accepted together with an
Officers' Certificate stating the aggregate principal amount of such Notes or
portions thereof being purchased by the Company. The Paying Agent shall promptly
mail to each Holder of the Notes so tendered the Change of Control Payment for
such Notes, and the Trustee shall promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each
such new Note shall be in a principal amount of $1,000 or an integral multiple
thereof. The Company shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date.
The Change of Control provisions described above shall be applicable
whether or not any other provisions of this Indenture are applicable.
The Company shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Section 4.13 and purchases all Notes (or portions thereof) validly
tendered and not withdrawn under such Change of Control Offer.
Section 4.14. Additional Subsidiary Guarantees.
In the event that the Company or any of its Subsidiaries shall acquire or
create a Restricted Subsidiary after the date of this Indenture, such newly
acquired or created Restricted Subsidiary shall be deemed to make the guarantee
set forth in Section 11.01 and the Company shall cause such Subsidiary to
evidence such guarantee in the manner set forth in Section 11.02; provided that,
in no event shall any non-U.S. Subsidiary of the Company be deemed to make such
guarantee or be required to execute a Guarantee in accordance with Section
11.02.
Section 4.15. Corporate Existence.
Subject to Article 5 hereof, the Company and the Subsidiaries shall do or
cause to be done all things necessary to preserve and keep in full force and
effect (i) its corporate existence, and the corporate, partnership or other
existence of each of the Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of the
Company or any such Subsidiary and (ii) the rights (charter, partnership
agreement and
45
statutory), licenses and franchises of the Company and the Subsidiaries;
provided, however, that the Company and the Subsidiaries shall not be required
to preserve any such right, license or franchise, or the corporate, partnership
or other existence of any of the Subsidiaries, if the Board of Directors of the
relevant Person shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and the Subsidiaries,
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders of the Notes.
Section 4.16. No Senior Subordinated Debt.
Notwithstanding the provisions of Section 4.09 hereof, (i) the Company
shall not incur, create, issue, assume, guarantee or otherwise become liable for
any Indebtedness that is subordinate or junior in right of payment to any Senior
Debt of the Company and senior in any respect in right of payment to the Notes
and (ii) the Subsidiary Guarantors shall not directly or indirectly incur,
create, issue, assume, guarantee or otherwise become liable for any Indebtedness
that is subordinate or junior in right of payment to Senior Debt of the Company
and senior in any respect in right of payment to the Guarantees; provided,
however, that the foregoing limitations shall not apply to distinctions between
categories of Indebtedness that exist by reason of any Liens arising or created
in respect of some but not all such Indebtedness.
Section 4.17. Business Activities.
The Company shall not, and shall not permit any Restricted Subsidiary to,
engage in any material respect in any business other than the Oil and Gas
Business.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Substantially All Assets.
The Company shall not consolidate or merge with or into (whether or not
the Company is the surviving corporation), or sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its properties or
assets, in one or more related transactions, to another Person, and the Company
may not permit any of its Restricted Subsidiaries to enter into any such
transaction or series of transactions if such transaction or series of
transactions would, in the aggregate, result in a sale, assignment, transfer,
lease, conveyance, or other disposition of all or substantially all of the
properties or assets of the Company to another Person, in either case unless (i)
the Company is the surviving corporation or the Person formed by or surviving
any such consolidation or merger (if other than the Company) or to which such
sale, assignment, transfer, lease, conveyance or other disposition shall have
been made (the "Surviving Entity") is a corporation organized or existing under
the laws of the United States, any state thereof or the District of Columbia;
(ii) the Surviving Entity (if the Company is not the continuing obligor under
this Indenture) assumes all the obligations of the Company under any
Registration Rights Agreement, the Notes and this Indenture pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee; (iii)
immediately before and after giving effect to such transaction or series of
transactions no Default or Event of Default exists; (iv) immediately after
giving effect to such transaction or series of transactions on a pro forma basis
(and treating any
46
Indebtedness not previously an obligation of the Company or any of its
Subsidiary which becomes the obligation of the Company or any of its Subsidiary
as a result of such transaction or series of transactions as having been
incurred at the time of such transaction or series of transactions), the
Consolidated Net Worth of the Company and its Subsidiaries or the Surviving
Entity (if the Company is not the continuing obligor under this Indenture) is
equal to of greater than the Consolidated Net Worth of the Company and its
Subsidiaries immediately prior to such transaction or series of transactions and
(v) the Company or Surviving Entity (if the Company is not the continuing
obligor under this Indenture) will, at the time of such transaction or series of
transactions and after giving pro forma effect thereto as if such transaction or
series of transactions had occurred at the beginning of the applicable
four-quarter period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the test set forth in the first paragraph of Section
4.09 hereof. Notwithstanding the foregoing clauses (iv) and (v), any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Company, and any Wholly Owned Restricted Subsidiary
may consolidate with, merge into or transfer all or part of its properties and
assets to another Wholly Owned Restricted Subsidiary.
Section 5.02. 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 Surviving Entity
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the Surviving Entity and not to the Company), and may exercise every right and
power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest (including any
interest payable as Liquidated Damages), if any, on the Notes when the
same becomes due and payable and the Default continues for a period of 30
days, whether or not such payment is prohibited by the provisions of
Article 10 hereof;
(2) the Company defaults in the payment of the principal of or
premium, if any, on the Notes, whether or not such payment is prohibited
by the provisions of Article 10 hereof;
47
(3) the Company fails to observe or perform any covenant, condition
or agreement on the part of the Company to be observed or performed
pursuant to Article 5 hereof;
(4) the Company fails to observe or perform any covenant, condition
or agreement on the part of the Company to be observed or performed
pursuant to Sections 4.03, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14,
4.16 and 4.17 hereof and the Default continues for the period and after
the notice specified below;
(5) the Company fails to comply with any of its other agreements or
covenants in, or provisions of, the Notes or this Indenture and the
Default continues for consecutive days after the notice specified below;
(6) except as permitted herein, any Guarantee shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or a Subsidiary Guarantor, or any
Person acting on behalf of a Subsidiary Guarantor, shall deny or disaffirm
such Subsidiary Guarantor's obligation under its Guarantee;
(7) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries), whether such Indebtedness
or guarantee now exists or shall be created hereafter, which default (a)
is caused by a failure to pay principal of or premium, if any, or interest
on such Indebtedness prior to the expiration of the grace period provided
in such Indebtedness on the date of such default (a "Payment Default") or
(b) results in the acceleration of such Indebtedness prior to its express
maturity and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under
which there is then existing a Payment Default or the maturity of which
has been so accelerated, aggregates $10 million or more; provided, that if
any such default is cured or waived or any such acceleration rescinded, or
such Indebtedness is repaid, within a period of 10 days from the
continuation of such default beyond the applicable grace period or the
occurrence of such acceleration, as the case may be, such Event of Default
under this Indenture and any consequential acceleration of the Notes shall
be automatically rescinded;
(8) a final non-appealable judgment or order or final non-appealable
judgments or orders are rendered against the Company or any Restricted
Subsidiary that remain unpaid or discharged for a period of 60 days and
that require the payment of money, either individually or in an aggregate
amount, in excess of $10 million;
(9) the Company or any Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant
Subsidiary, pursuant to or within the meaning of any Bankruptcy Law:
(a) a commences a voluntary case or proceeding,
48
(b) consents to the entry of an order for relief against it in an
involuntary case or proceeding,
(c) consents to the appointment of a Custodian of it or for all
or substantially all of its property or
(d) makes a general assignment for the benefit of its creditors;
(10) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(a) is for relief against the Company or any Significant
Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary, in an involuntary case or
proceeding,
(b) appoints a Custodian of the Company, any Significant
Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary, or for all or substantially all of
the property of the Company, any Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant
Subsidiary, or
(c) orders the liquidation of the Company, any Significant
Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary,
and in each case the order or decree remains unstayed and in effect for 60
consecutive days.
The term "Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
A Default under clause (4) is not an Event of Default until the Trustee
notifies the Company, or the Holders of at least 25% in principal amount of the
then outstanding Notes notify the Company and the Trustee, of the Default and
the Company does not cure the Default within 30 consecutive days after receipt
of the notice. A Default under clause (5) is not an Event of Default until the
Trustee notifies the Company, or the Holders of at least 25% in principal amount
of the then outstanding Notes notify the Company and the Trustee, of the Default
and the Company does not cure the Default within 60 days after receipt of the
notice. The notice must specify the Default, demand that it be remedied and
state that the notice is a "Notice of Default."
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in
clauses (9) and (10) of Section 6.01 hereof) relating to the Company or any
Subsidiary Guarantor occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in principal amount of the then
outstanding Notes by written notice to the Company and the Trustee, may declare
the unpaid principal amount of and any accrued and unpaid interest on all the
Notes to be due and payable immediately. If payment of the Notes is accelerated
because of an Event of Default, the Company or the Trustee shall notify the
holders of Designated Senior Debt of such
49
acceleration. Upon such declaration the principal and interest shall be due and
payable immediately; provided, however, that so long as any Designated Senior
Debt or any commitment therefor is outstanding, any such notice or declaration
shall not become effective until the earlier of (a) five Business Days after
such notice is delivered to the representative for the Designated Senior Debt or
(b) the acceleration of any Designated Senior Debt and thereafter, payments on
the Notes pursuant to this Article 6 shall be made only to the extent permitted
pursuant to Article 10 herein. Notwithstanding the foregoing, if any Event of
Default specified in clause (9) or (10) of Section 6.01 hereof relating to the
Company, any Significant Subsidiary or any group of Subsidiaries that, taken
together, would constitute a Significant Subsidiary occurs, such an amount shall
ipso facto become and be immediately due and payable without any declaration or
other act or notice on the part of the Trustee or any Holder.
After a declaration of acceleration under this Indenture, but before a
judgment or decree for payment of principal, premium, if any, and interest on
the Notes due under this Article 6 has been obtained by the Trustee, Holders of
a majority in principal amount of the then outstanding Notes by written notice
to the Company and the Trustee may rescind an acceleration and its consequences
if (i) the Company or any Subsidiary Guarantor has paid or deposited with the
Trustee a sum sufficient to pay (a) all sums paid or advanced by the Trustee
under this Indenture and the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel and (b) all overdue interest
on the Notes, if any, (ii) the rescission would not conflict with any judgment
or decree of a court of competent jurisdiction and (iii) all existing Events of
Default (except nonpayment of principal, premium, if any, or interest that has
become due solely because of the acceleration) have been cured or waived.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of principal of, premium and liquidated damages, if any, or interest on,
the Notes (including in connection with an offer to purchase) (provided,
however, that the Holders of a majority in aggregate principal amount of the
then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such acceleration).
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this
50
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 6.05. Control by Majority.
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability it being understood that (subject to Section 7.01)
the Trustee shall have no duty to ascertain whether or not such actions or
forbearances are unduly prejudicial to such holders.
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 gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.
Section 6.07. 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 interest
on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective 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(1) or (2) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust
51
against the Company or any Subsidiary Guarantor for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.09. 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 of the Subsidiary Guarantors (or any other obligor upon the Notes), its
creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee, and in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and may be a member of the
creditors' committee.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall,
subject to the provisions of Article 10, pay out the money in the following
order:
First: to the Trustee, its agents and attorneys for amounts due
under Sections 6.08 and 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, if any, and accrued interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium, if any, and accrued interest,
as the case may be, respectively; and
52
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
Article 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any notices, requests, statements,
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
53
(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.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have furnished to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents, may in all
cases pay, subject to reimbursement as provided in Section 7.07, such reasonable
compensation as it deems proper to all such attorneys and agents, and shall not
be responsible for the misconduct or negligence of any attorney or agent
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company or any Subsidiary
Guarantor shall be sufficient if signed by an Officer of the Company or such
Subsidiary Guarantor.
54
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have furnished to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
(g) Except with respect to Sections 4.01 and 4.04 hereof, the Trustee
shall have no duty to inquire as to the performance of the Company's covenants
in Article 4 hereof. In addition, the Trustee shall not be deemed to have
knowledge of any Default or Event of Default except (i) any Event of Default
occurring pursuant to Sections 4.01, 4.04 and 6.01(1) or (2) hereof or (ii) any
Default or Event of Default of which a Responsible Officer of the Trustee shall
have received written notification or obtained actual knowledge. For the
purposes of this clause (g) only, "actual knowledge" shall mean the actual fact
or statement of knowing, without any duty to make investigation with regard
thereto.
(h) The Trustee shall not be required to give any bond or surety in
respect of the performance of its duties or the exercise of its powers
hereunder.
(i) the Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions, or agreements on the
part of the Company, except as otherwise set forth herein, but the Trustee may
require of the Company full information and advice as to the performance of the
covenants, conditions and agreements contained herein and shall be entitled in
connection herewith to examine the books, records and premises of the Company.
(j) The permissive rights of the Trustee to perform the acts enumerated
in this Indenture shall not be construed as a duty and the Trustee shall not be
answerable for other than its negligence or willful misconduct.
Section 7.03. Individual Rights of Trustee.
The Trustee in its commercial banking or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company, the
Subsidiary Guarantors or any Affiliate of the Company with the same rights it
would have if it were not Trustee. However, in the event that the Trustee
acquires any conflicting interest it must eliminate such conflict within 90
days, apply to the Commission for permission to continue as trustee or resign.
Any Agent may do the same with like rights and duties. The Trustee is also
subject to Sections Section 7.10 and Section 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, the Notes, or the Guarantees, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or in any
certificate delivered pursuant hereto or any statement in the Notes or any other
document in connection with the sale of the Notes or pursuant to this Indenture
other than its certificate of authentication.
55
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee in the manner contemplated in Section 7.02(g), the Trustee
shall mail to Holders of Notes a notice of the Default or Event of Default
within 90 days after it occurs. Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on, any Note,
the Trustee may 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) and 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 Commission 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.
Section 7.07. Compensation and Indemnity.
The Company and the Subsidiary Guarantors shall pay to the Trustee from
time to time reasonable compensation for its acceptance of this Indenture and
services hereunder, including, without limitation, extraordinary services such
as default administration. The Trustee's compensation shall not be limited by
any law on compensation of a trustee of an express trust. The Company and the
Subsidiary Guarantors shall reimburse the Trustee promptly upon request for all
reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Company and the Subsidiary Guarantors shall indemnify the Trustee
against any and all losses, liabilities or expenses incurred by it arising out
of or in connection with the acceptance or administration of its duties under
this Indenture, including the costs and expenses of enforcing this Indenture
against the Company and the Subsidiary Guarantors (including this Section 7.07)
and investigating or defending itself against any claim (whether asserted by the
Company, the Subsidiary Guarantors or any Holder or any other person) or
liability in connection with the exercise or performance of any of its powers or
duties hereunder, except to the extent any such loss, liability or expense may
be attributable to its negligence or bad faith. The Trustee shall notify the
Company and the Subsidiary Guarantors promptly of any claim for which it may
seek indemnity. Failure by the Trustee to so notify the Company and the
Subsidiary Guarantors shall not relieve the Company and the Subsidiary
Guarantors of their obligations hereunder. The Company and the Subsidiary
Guarantors shall defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel and the Company and the
Subsidiary
56
Guarantors shall pay the reasonable fees and expenses of such counsel. The
Company and the Subsidiary Guarantors need not pay for any settlement made
without their consent, which consent shall not be unreasonably withheld.
The obligations of the Company and the Subsidiary Guarantors under this
Section 7.07 are joint and several and shall survive the satisfaction and
discharge of this Indenture.
To secure the Company's and the Subsidiary Guarantors' payment obligations
in this Section, the Trustee shall have a Lien prior to the Notes on all money
or property held or collected by the Trustee, except that held in trust to pay
principal and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(9) or (10) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section 313(b)(2) to
the extent applicable.
Section 7.08. 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:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief. is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a Custodian or public officer takes charge of the Trustee or
its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10%
57
in principal amount of the then outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has been
a Holder of a Note for at least six months, fails to comply with Section 7.10,
such Holder of a Note may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders of the Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 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.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation,
bank or banking association organized and doing business under the laws of the
Unites States of America or of any state thereof that is authorized under such
laws to exercise corporate trustee power, that is subject to supervision or
examination by federal or state authorities and that has a combined capital and
surplus of at least $50 million as set forth in its most recent published annual
report of condition.
This Indenture shall always have a Trustee who satisfies the requirements
of TIA 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
moved shall be subject to TIA Section 311(a) to the extent indicated therein.
58
Article 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
Section 8.02. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and the Subsidiary Guarantors
shall, subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be deemed to have been discharged from their obligations with respect to
all outstanding Notes and the Guarantees thereof on the date the conditions set
forth below are satisfied (hereinafter, "Legal Defeasance"). For this purpose,
Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Notes, which
shall thereafter be deemed to be "outstanding" only for the purposes of Section
8.05 hereof and the other Sections of this Indenture referred to in (a) and (b)
below, and to have satisfied all its other obligations under such Notes and this
Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder: (a) the rights of Holders of outstanding Notes to receive
payments in respect of the principal,. of, premium, if any, and interest on such
Notes when such payments are due from the trust fund described in Section 8.04
hereof, and as more fully set forth in such Section, (b) the Company's
obligations with respect to such Notes under Article 2 and Section 4.02 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 8.
Subject to compliance with this Article 8, the Company may exercise its option
under this Section 8.02 notwithstanding the prior exercise of its option under
Section 8.03 hereof.
Section 8.03. Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and the Subsidiary Guarantors
shall, subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be released from their obligations under the covenants contained in
Sections 4.03, 4.05, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16 and
4.17 hereof and in clause (iv) of Section 5.01 and the covenants contained in
the Guarantees with respect to the outstanding Notes on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Notes shall thereafter be deemed not "outstanding" for the purposes of
any compliance certificate, direction, waiver, consent or declaration or act of
Holders (and the consequences of any thereof) in connection with such covenants,
but shall continue to be deemed "outstanding" for all other purposes hereunder
(it being understood that such Notes shall not be deemed outstanding for
accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Notes, the
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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, such Notes and such Guarantees
shall be unaffected thereby. In addition, upon the Company's exercise under
Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(3) (but only with respect to the Company's failure to observe or
perform the covenants, conditions and agreements of the Company under clause
(iv) of Section 5.01, 6.01(4), 6.01(7) and 6.01(8) hereof shall not constitute
Events of Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders of the Notes, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such amounts as
will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any, and
interest, on the outstanding Notes on the stated maturity or on the applicable
redemption date, as the case may be, and the Company must specify whether the
Notes are being defeased to maturity or to a particular redemption date;
(b) in the case of an election under Section 8.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be continuing
on the date of such deposit (other than a Default or Event of Default resulting
from the borrowing of funds to
60
be applied to such deposit) or insofar as Section 6.01(9) or 6.01(10) hereof is
concerned, at any time in the period ending on the 91st day after the date of
deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(f) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that after the 91st day following the deposit, the trust
funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;
(g) the Company shall deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of the Notes over the other creditors of the Company, or
with the intent of defeating, hindering, delaying or defrauding creditors of the
Company or others;. and
(h) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Section 8.05. Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company and the Subsidiary Guarantors shall pay and indemnify the
Trustee against any tax, fee or other charge imposed on or assessed against the
cash or non-callable Government Securities deposited pursuant to Section 8.04
hereof or the principal and interest received in respect thereof other than any
such tax, fee or other charge which by law is for the account of the Holders of
the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may. be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
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Section 8.06. Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
premium, if any, or interest has become due and payable shall be paid to the
Company on its written request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as a
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
shall be repaid to the Company. Any money held by the Trustee pursuant to this
Section 8.06 shall be held uninvested and without liability for interest.
Section 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the obligations of the Company and the Subsidiary Guarantors
under this Indenture, the Notes and the Guarantees shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
hereof, as the case may be; provided, however, that if the Company or any
Subsidiary Guarantor makes any payment of principal of, premium, if any, or
interest on any Note following the reinstatement of its obligations, the Company
or such Subsidiary Guarantor shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
Article 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Subsidiary Guarantors and the Trustee may amend or supplement this Indenture,
the Notes or the Guarantees without the consent of any Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place
of certificated Notes;
(c) to provide for the assumption of the Company's obligations to
the Holders of the Notes in the case of a merger or consolidation pursuant
to Article 5 hereof;
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(d) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any Holder of the Note;
(e) to secure the Notes; or
(f) to comply with requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a resolution of the Board
of Directors of the Company and each of the Subsidiary Guarantors, as the case
may be, authorizing the execution of any such amended or supplemental indenture,
and upon receipt by the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company and the Subsidiary Guarantors in
the execution of any amended or supplemental indenture authorized or permitted
by the terms of this Indenture and to make any further appropriate agreements
and stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company, the Subsidiary
Guarantors and the Trustee may amend or supplement this Indenture, the Notes and
the Guarantees with the consent of the Holders of at least a majority in
aggregate principal amount of the Notes then outstanding (including, without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof,
any existing Default or Event of Default (other than a Default or Event of
Default in the payment of the principal of, premium, if any, or interest on the
Notes, except a payment default resulting from an acceleration that has been
rescinded) or compliance with any provision of this Indenture, the Notes or the
Guarantees may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including, without limitation,
consents obtained in connection with a purchase of, or tender offer or exchange
offer for the Notes).
Notwithstanding the foregoing, without the consent of at least 66 2/3% in
aggregate principal amount of the Notes then outstanding (including consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Notes), no waiver or amendment to this Indenture may make any change in the
provisions of Sections 3.09, 4.10 and 4.13 hereof that adversely affect the
rights of any Holder of Notes. In addition, any amendment to the provisions of
Article 10 of this Indenture shall require the consent of the Holders of at
least 66 2/3% in aggregate principal amount of the Notes then outstanding if
such amendment would adversely affect the rights of Holders of Notes; provided
that, no amendment may be made to the provisions of Article 10 of this Indenture
that adversely affects the rights of any holder of Senior Debt then outstanding
unless the holders of such Senior Debt (or any group or representative thereof
authorized to consent) consent to such change.
Subject to Sections 6.04 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
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Company or any Subsidiary Guarantor with any provision of this Indenture, the
Notes or the Guarantees. However, without the consent of each Holder affected,
an amendment or waiver may not (with respect to any Notes held by a
non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter the provisions with respect to the redemption of the Notes (except as
provided above with respect to Sections 3.09, 4.10 and 4.13 hereof);
(c) reduce the rate of or change the time for payment of interest
on any Note;
(d) waive a Default or Event of Default in the payment of principal of
or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in principal
amount of the Notes and a waiver of the payment default that resulted from such
acceleration);
(e) make any Note payable in money other than that stated in the
Notes;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal or premium, if any, or interest on the Notes; or
(g) make any change in the foregoing amendment and waiver
provisions.
Upon the request of the Company accompanied by a resolution of the Board
of Directors of the Company and each of the Subsidiary Guarantors, as the case
may be, authorizing the execution of any such amended or supplemental indenture,
and upon the filing with the Trustee of evidence satisfactory to the Trustee of
the consent of the Holders of Notes as aforesaid, and upon receipt by the
Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Company and the Subsidiary Guarantors in the execution of such
amended or supplemental indenture unless such amended or supplemental indenture
affects the Trustee's own rights, duties or immunities under this indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 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.
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Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amended or supplemental Indenture that complies with the TIA as then
in effect.
Section 9.04. 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, 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 Amendment, etc.
The Trustee shall sign any amended or supplemental indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. Neither the
Company nor any Subsidiary Guarantor may sign an amendment or supplemental
Indenture until its respective Board of Directors approves it. In executing any
amended or supplemental indenture, the Trustee shall be entitled to receive and
(subject to Section 7.01) shall be fully protected in relying upon, an Officer's
Certificate and an Opinion of Counsel stating that the execution of such amended
or supplemental indenture is authorized or permitted by this Indenture and that
there has been compliance with all conditions precedent.
Article 10
SUBORDINATION
Section 10.01. Agreement to Subordinate.
The Company and each Subsidiary Guarantor agree, and each Holder by
accepting a Note and the related Guarantee agrees, that (i) the Indebtedness
evidenced by (a) the Notes, including, but not limited to, the payment of
principal of, premium, if any, and interest on the Notes, and any other payment
Obligation of the Company in respect of the Notes (including any obligation to
repurchase the Notes) is subordinated in right of payment, to the extent and in
the manner
65
provided in this Article, to the prior payment in full in cash of all Senior
Debt of the Company (whether outstanding on the date hereof or hereafter
created, incurred, assumed or guaranteed), and (b) the Guarantees and other
payment Obligations in respect of the Guarantees are subordinated in right of
payment, to the extent and in the manner provided in this Article, to the prior
payment in full in cash of all Senior Debt of each Subsidiary Guarantor and (ii)
the subordination is for the benefit of the Holders of Senior Debt.
Section 10.02. Certain Definitions.
"Bankruptcy Law" means the Bankruptcy Code or any similar Federal or state
law for the relief of debtors.
"Representative" means the indenture trustee or other trustee, agent or
representative for any Senior Debt.
"Senior Debt" means (i) Indebtedness of the Company or any Subsidiary of
the Company under or in respect of any Credit Facility, whether for principal,
interest (including interest accruing after the filing of a petition initiating
any proceeding pursuant to any Bankruptcy Law, whether or not the claim for such
interest is allowed as a claim in such proceeding), reimbursement obligations,
fees, commissions, expenses, indemnities or other amounts and (ii) any other
Indebtedness of the Company or any Subsidiary of the Company permitted under the
terms of this Indenture, unless the instrument under which such Indebtedness is
incurred expressly provides that it is on a parity with or subordinated in right
of payment to the Notes. Notwithstanding anything to the contrary in the
foregoing sentence, Senior Debt will not include (w) any liability for federal,
state, local or other taxes owed or owing by the Company, (x) any Indebtedness
of the Company to any of its Subsidiaries or other Affiliates, (y) any trade
payables or (z) any Indebtedness that is incurred in violation of this Indenture
(other than Indebtedness under (i) any Credit Agreement or (ii) any other Credit
Facility that is incurred on the basis of a representation by the Company to the
applicable lenders that it is permitted to incur such Indebtedness under this
Indenture).
A "distribution" may consist of cash, securities or other property, by
set-off or otherwise.
All Designated Senior Debt now or hereafter existing and all other
Obligations relating thereto shall not be deemed to have been paid in full
unless the holders or owners thereof shall have received payment in full in cash
(or other form of payment consented to by the holders of such Designated Senior
Debt) with respect to such Designated Senior Debt and all other Obligations with
respect thereto.
Section 10.03. Liquidation; Dissolution; Bankruptcy.
(a) Upon any payment or distribution of property or securities to
creditors of the Company in a liquidation or dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property, or in an assignment for the benefit of
creditors or any marshalling of the Company's assets and liabilities:
(1) the holders of Senior Debt of the Company shall be entitled
to receive payment in full in cash of all Obligations in respect of such
Senior Debt (including
66
interest after the commencement of any such proceeding at the rate
specified in the applicable Senior Debt, whether or not a claim for such
interest would be allowed in such proceeding) before the Holders of Notes
shall be entitled to receive any payment with respect to the Notes and
related Obligations (except in each case that Holders of Notes may receive
securities that are subordinated at least to the same extent as the Notes
to Senior Debt and any securities issued in exchange for Senior Debt and
payments made from any defeasance trust created pursuant to Section 8.01
hereof provided that the applicable deposit does not violate Article 8 or
10 of this Indenture); and
(2) until all Obligations with respect to Senior Debt of the
Company (as provided in subsection (1) above) are paid in full in cash,
any payment or distribution to which the Holders of Notes and the related
Guarantees would be entitled shall be made to holders of Senior Debt of
the Company (except that Holders of Notes and the related Guarantees may
receive securities that are subordinated at least to the same extent as
the Notes to Senior Debt and any securities issued in exchange for Senior
Debt and payments made from any defeasance trust created pursuant to
Section 8.01 hereof provided that the, applicable deposit does not violate
Article 8 or 10 of this Indenture).
(b) Upon any payment or distribution of property or securities to
creditors of a Subsidiary Guarantor in a liquidation or dissolution of such
Subsidiary Guarantor or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to such Subsidiary Guarantor or its
property, or in an assignment for the benefit of creditors or any marshalling of
such Subsidiary Guarantor's assets and liabilities:
(1) the holders of Senior Debt of such Subsidiary Guarantor
shall be entitled to receive payment in full in cash of all Obligations in
respect of such Senior Debt (including interest after the commencement of
any such proceeding at the rate specified in the applicable Senior Debt,
whether or not a claim for such interest would be allowed in such
proceeding) before the Holders of Notes and the related Guarantees shall
be entitled to receive any payment or distribution with respect to the
Guarantee made by such Subsidiary Guarantor (except in each case that
Holders of Notes and the related Guarantees may receive securities that
are subordinated at least to the same extent as the Notes to Senior Debt
and any securities issued in exchange for Senior Debt and payments made
from any defeasance trust created pursuant to Section 8.01 hereof provided
that the applicable deposit does not violate Article 8 or 10 of this
Indenture); and
(2) until all Obligations with respect to Senior Debt of such
Subsidiary Guarantor (as provided in subsection (1) above) are paid in
full in cash, any payment or distribution to which the Holders of Notes
and the related Guarantees would be entitled shall be made to holders of
Senior Debt of such Subsidiary Guarantor (except that Holders of Notes and
the related Guarantees may receive securities that are subordinated at
least to the same extent as the Notes to Senior Debt and any securities
issued in exchange for Senior Debt and payments made from any defeasance
trust created pursuant to Section 8.01 hereof provided that the applicable
deposit does not violate Article 8 or 10 of this Indenture).
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Under the circumstances described in this Section 10.03, the Company, any
Subsidiary Guarantor or any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar person making any payment or distribution of
cash or other property or securities is authorized or instructed to make any
payment or distribution to which the Holders of the Notes and the related
Guarantees would otherwise be entitled (other than securities that are
subordinated at least to the same extent as the Notes to Senior Debt and any
securities issued in exchange for Senior Debt and payments made from any
defeasance trust referred to in the second parenthetical clause of each of
clauses (a)(1), (b)(1), (a)(2) and (b)(2) above, which shall be delivered or
paid to the Holders of Notes as set forth in such clauses) directly to the
holders of the Senior Debt of the Company and any Subsidiary Guarantor, as
applicable, (pro rata to such holders on the basis of the respective amounts of
Senior Debt of the Company and any Subsidiary Guarantor, as applicable, held by
such holders) or their Representatives, or to any trustee or trustees under any
other indenture pursuant to which any such Senior Debt may have been issued, as
their respective interests appear, to the extent necessary to pay all such
Senior Debt in full, in cash or cash equivalents after giving effect to any
concurrent payment, distribution or provision thereof or to or for the holders
of such Senior Debt.
To the extent any payment of or distribution in respect of Senior Debt
(whether by or on behalf of the Company or any Subsidiary Guarantor, as proceeds
of security or enforcement of any right of setoff or otherwise) is declared to
be fraudulent or preferential, set aside or required to be paid to any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar Person under
any bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then if such payment or distribution is recovered by, or paid over to, such
receiver, trustee in bankruptcy, liquidating trustee, agent or other similar
Person, the Senior Debt or part thereof originally intended to be satisfied
shall be deemed to be reinstated and outstanding as if such payment had not
occurred. To the extent the obligation to repay any Senior Debt is declared to
be fraudulent, invalid or otherwise set aside under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then the obligation so
declared fraudulent, invalid or otherwise set aside (and all other amounts that
would come due with respect thereto had such obligation not been so affected)
shall be deemed to be reinstated and outstanding as Senior Debt for all purposes
hereof as if such declaration, invalidity or setting aside had not occurred.
Section 10.04. Default on Designated Senior Debt.
The Company and the Subsidiary Guarantors may not make any payment
(whether by redemption, purchase, retirements, defeasance or otherwise) upon or
in respect of the Notes and the related Guarantees (other than securities that
are subordinated at least to the same extent as the Notes to Senior Debt and any
securities issued in exchange for Senior Debt and payments and other
distributions made from any defeasance trust created pursuant to Section 8.01
hereof if the applicable deposit does not violate Article 8 or 10 of this
Indenture) until all principal and other Obligations with respect to the Senior
Debt of the Company have been paid in full if:
(i) a default in the payment of any principal of, premium, if
any, or interest on Designated Senior Debt occurs; or
(ii) any other default occurs and is continuing with respect to
Designated Senior Debt that permits, or with the giving of notice or
passage of time or both (unless
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cured or waived) would permit, holders of the Designated Senior Debt as to
which such default relates to accelerate its maturity and the Trustee
receives a notice of the default (a "Payment Blockage Notice") from the
Company or the holders of any Designated Senior Debt. If the Trustee
receives any such Payment Blockage Notice, no subsequent Payment Blockage
Notice shall be effective for purposes of this Section unless and until
360 days shall have elapsed since the date of commencement of the payment
blockage period resulting from the immediately prior Payment Blockage
Notice. No nonpayment default in respect of any Designated Senior Debt
that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee shall be, or be made, the basis for a
subsequent Payment Blockage Notice.
The Company shall resume payments on and distributions in respect of the
Notes and any Subsidiary Guarantor shall resume making payments and
distributions pursuant to the Guarantees upon:
(1) in the case of a default referred to in Section
10.04(i) hereof the date upon which the default is cured or waived,
or
(2) in the case of a default referred to in Section 10.04(ii)
hereof, the earliest of (1) the date on which such nonpayment default is
cured or waived, (2) the date the applicable Payment Blockage Notice is
retracted by written notice to the Trustee and (3) 90 days after the date
on which the applicable Payment Blockage Notice is received unless (A) the
maturity of any Designated Senior Debt has been accelerated or (B) a
Default or Event of Default under Section 6.01(9) or (10) has occurred and
is continuing,
if this Article otherwise permits the payment, distribution or acquisition at
the time of such payment or acquisition.
Section 10.05. 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 10.06. When Distribution Must be Paid Over.
In the event that the Trustee or any Holder receives any payment or
distribution of or in respect of any Obligations with respect to the Notes or
the Guarantees at a time when such payment or distribution is prohibited by
Section 10.03 or Section 10.04 hereof, such payment or distribution shall be
held by the Trustee (if the Trustee has actual knowledge that such payment or
distribution is prohibited by Section 10.03 or Section 10.04) or such Holder, in
trust for the benefit of, and shall be paid forthwith over and delivered to, the
holders of Senior Debt as their interests may appear or their Representative
under the indenture or other agreement (if any) pursuant to which such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of all Obligations with respect to Senior Debt
remaining unpaid to the extent necessary to pay such Obligations in full in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Debt.
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With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically set
forth in this Article 10, and no implied covenants or obligations with respect
to the holders of Senior Debt shall be read into this Indenture against the
Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt, and, except as provided in Section 10.12, shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Holders of Notes or the Company, the Subsidiary Guarantors or any
other Person money or assets to which any holders of Senior Debt shall be
entitled by virtue of this Article 10, except if such payment is made as a
result of the willful misconduct or gross negligence of the Trustee.
Section 10.07. Notice by Company.
The Company and the Subsidiary Guarantors shall promptly notify the
Trustee and the Paying Agent of any facts known to the Company or any Subsidiary
Guarantor that would cause a payment of any Obligations with respect to the
Notes or the related Guarantees to violate this Article, but failure to give
such notice shall not affect the subordination of the Notes and the related
Guarantees to the Senior Debt as provided in this Article.
Section 10.08. Subrogation.
After all Senior Debt is paid in full and until the Notes are paid in
full, Holders of Notes and the related Guarantees shall be subrogated (equally
and ratably with all other Indebtedness pari passu with the Notes and the
Guarantees) to the rights of holders of Senior Debt to receive distributions and
payments applicable to Senior Debt to the extent that distributions and payments
otherwise payable to the Holders of Notes and the related Guarantees have been
applied to the payment of Senior Debt. A payment or distribution made under this
Article to holders of Senior Debt that otherwise would have been made to Holders
of Notes and the related Guarantees is not, as between the Company and Holders
of Notes, a payment by the Company on the Notes.
Section 10.09. Relative Rights.
This Article defines the relative rights of Holders of Notes and the
related Guarantees and holders of Senior Debt. Nothing in this Indenture shall:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of Notes and the
related Guarantees and creditors of the Company other than their rights in
relation to holders of Senior Debt; or
(3) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Debt to receive distributions and
payments otherwise payable to Holders of Notes and the related Guarantees.
70
If the Company fails because of this Article to pay principal of or
interest on a Note on the due date, the failure is still a Default or Event of
Default.
Section 10.10. Subordination May Not be Impaired by Company or the
Subsidiary Guarantors.
No right of any present or future holders of any Senior Debt to enforce
subordination as provided in this Article 10 will at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or any Subsidiary Guarantor or by any act or failure to act, in good faith, by
any such holder, or by any noncompliance by the Company or any Subsidiary
Guarantor with the terms of this Indenture, regardless of any knowledge thereof
that any such holder of Senior Debt may have or otherwise be charged with. The
provisions of this Article Ten are intended to be for the benefit of, and shall
be enforceable directly by, the holders of Senior Debt.
Section 10.11. Payment, Distribution or Notice to Representative.
Whenever a payment or distribution is to be made or a notice given to
holders of Senior Debt, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets or securities of the Company or
any Subsidiary Guarantor referred to in this Article 10, the Trustee and the
Holders of Notes and the related Guarantees shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction or upon any
certificate of such Representative or of the liquidating trustee or agent or
other Person making any payment or distribution to the Trustee or to the Holders
of Notes and the related Guarantees for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Senior Debt and other Indebtedness of the Company or any Subsidiary Guarantor,
the amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 10.
Section 10.12. Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article 10 or any other provision
of this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the Paying Agent may continue
to make payments on the Notes and the Guarantees, unless the Trustee shall have
received at its Corporate Trust Office at least one Business Day prior to the
date of such payment written notice of facts that would cause the payment of any
Obligations with respect to the Notes or Guarantees to violate this Article,
which notice shall specifically refer to Section 10.03 or 10.04 hereof. Only the
Company or a Representative may give the notice. Nothing in this Article 10
shall impair the claims of, or payments to, the Trustee under or pursuant to
Section 7.07 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.
71
Section 10.13. Authorization to Effect Subordination.
Each Holder by the Holder's acceptance thereof authorizes and directs the
Trustee on the Holder's behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article 10, and
appoints the Trustee to act as the Holder's attorney-in-fact for any and all
such purposes. If the Trustee does not file a proper proof of 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, each
lender under the Credit Agreement is hereby authorized to file an appropriate
claim for and on behalf of the Holders of the Notes and the related Guarantees.
Section 10.14. Amendments.
No amendment may be made to the provisions of or the definitions of any
terms appearing in this Article 10, or to the provisions of Section 6.02
relating to the Designated Senior Debt, that adversely affects the rights of any
holder of Senior Debt then outstanding unless the holders of such Senior Debt
(or any group or Representative authorized to give a consent) consent to such
change.
Section 10.15. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 10.09 of this
Indenture, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 10 or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding or secured; (b) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (c) release any Person liable in any manner for the
collection of Senior Debt; and (d) exercise or refrain from exercising any
rights against the Company and each Subsidiary Guarantor and any other Person.
Article 11
THE GUARANTEES
Section 11.01. The Guarantees.
Each of the Subsidiary Guarantors hereby, jointly and severally,
unconditionally guarantees to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns, irrespective
of the validity and enforceability of this Indenture, the Notes or the
obligations of the Company hereunder or thereunder, that: (a) the principal of
and premium and interest, on the Notes shall be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of and interest on premium and interest, on the Notes, if
any, if lawful, and all other obligations of the Company to the Holders or the
Trustee hereunder or thereunder shall be
72
promptly paid in full or performed, all in accordance with the terms hereof and
thereof; and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same shall be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise. Failing
payment when due of any amount so guaranteed or any performance so guaranteed
for whatever reason, the Subsidiary Guarantors shall be jointly and severally
obligated to pay the same immediately. The Subsidiary Guarantors hereby agree
that their obligations hereunder shall be unconditional, irrespective of the
validity, regularity or enforceability of the Notes or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
with respect to any provisions hereof or thereof, the recovery of any judgment
against the Company, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor. Each of the Subsidiary Guarantors hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to require a proceeding first
against the Company, protest, notice and all demands whatsoever and covenant
that this Guarantee shall not be discharged except by complete performance of
the obligations contained in the Notes and this Indenture. If any Holder or the
Trustee is required by any court or otherwise to return to the Company or the
Subsidiary Guarantors, or any Custodian, Trustee, liquidator or other similar
official acting in relation to either the Company or the Subsidiary Guarantors,
any amount paid by either to the Trustee or such Holder, this Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each of the Subsidiary Guarantors agrees that it shall not be entitled to any
right of subrogation in relation to the Holders of Notes in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby. Each of the Subsidiary Guarantors further agrees that, as
between the Subsidiary Guarantors, on the one hand, and the Holders and the
Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article 6 for the purposes of this
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby and (y) in the
event of any declaration of acceleration of such obligations as provided in
Article 6, such obligations (whether or not due and payable) shall forthwith
become due and payable by the Subsidiary Guarantors for the purpose of this
Guarantee. The Subsidiary Guarantors shall have the right to seek contribution
from any Subsidiary Guarantor not paying so long as the exercise of such right
does not impair the rights of the Holders under the Guarantees.
Section 11.02. Execution and Delivery of Guarantees.
(i) To evidence its Guarantee set forth in Section 11.01, each of the
Subsidiary Guarantors hereby agrees that a notation of such Guarantee
substantially in the form of Exhibit C shall be endorsed by an officer of such
Subsidiary Guarantor on each Note authenticated and delivered by the Trustee,
that this Indenture shall be executed on behalf of such Subsidiary Guarantor by
its President or one of its Vice Presidents and attested to by an Officer and
that such Subsidiary Guarantor shall deliver to the Trustee an Opinion of
Counsel that the foregoing have been duly authorized, executed and delivered by
such Subsidiary Guarantor and that such Guarantee is a valid and legally binding
obligation of such Subsidiary Guarantor, enforceable against such Subsidiary
Guarantor in accordance with its terms.
73
Each Subsidiary Guarantor hereby agrees that its Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Guarantee.
If an Officer whose signature is on this Indenture or on the applicable
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which such Guarantee is endorsed, such Guarantee shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Guarantees set forth in this
Indenture on behalf of the Subsidiary Guarantors.
Section 11.03. Subsidiary Guarantors May Consolidate, etc., on
Certain Terms.
No Subsidiary Guarantor may consolidate with or merge with or into
(whether or not such Subsidiary Guarantor is the Surviving Person) another
Person, whether or not affiliated with such Subsidiary Guarantor, unless:
(a) subject to the provisions of Section 11.04 hereof, the Person formed
by or surviving any such consolidation or merger (if other than such Subsidiary
Guarantor) assumes all the obligations of such Subsidiary Guarantor pursuant to
a supplemental indenture in form reasonably satisfactory to the Trustee in
respect of the Notes, this Indenture and such Subsidiary Guarantor's Guarantee;
(b) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(c) such transaction does not violate any of Sections 4.03, 4.07, 4.08,
4.09, 4.11, 4.12, 4.13, 4.14, 4.16 and 4.17.
Notwithstanding the foregoing, none of the Subsidiary Guarantors shall be
permitted to consolidate with or merge with or into (whether or not such
Subsidiary Guarantor is the surviving Person), another corporation, Person or
entity pursuant to the preceding sentence if such consolidation or merger would
not be permitted by Section 5.01 hereof.
In case of any such consolidation or merger and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the Guarantee endorsed upon
the Notes and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by such Subsidiary Guarantor, such
successor corporation shall succeed to and be substituted for such Subsidiary
Guarantor with the same effect as if it had been named herein as a Subsidiary
Guarantor. Such successor corporation thereupon may cause to be signed any or
all of the Guarantees to be endorsed upon all of the Notes issuable hereunder
which theretofore shall not have been signed by the Company and delivered to the
Trustee. All the Guarantees so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Guarantees theretofore and
thereafter issued in accordance with the terms of this Indenture as though all
of such Guarantees had been issued at the date of the execution hereof.
74
Except as set forth in Articles 4 and 5 hereof, nothing contained in this
Indenture or in any of the Notes shall prevent any consolidation or merger of
any Subsidiary Guarantor with or into the Company or another Subsidiary
Guarantor, or shall prevent any sale or conveyance of the property of any
Subsidiary Guarantor as an entirety or substantially as an entirety to the
Company or any Subsidiary Guarantor.
Section 11.04. Releases of Guarantees.
In the event of a sale or other disposition of all or substantially all of
the assets of any Subsidiary Guarantor or a sale or other disposition of all of
the capital stock of any Subsidiary Guarantor, to any corporation or other
Person (including an Unrestricted Subsidiary) by way of merger, consolidation,
or otherwise, in a transaction that does not violate any of the covenants of
this Indenture, then such Subsidiary Guarantor (in the event of a sale or other
disposition, by way of such merger, consolidation or otherwise, of all the
capital stock of such Subsidiary Guarantor) shall be released and relieved of
any obligations under its Guarantee and such acquiring corporation or other
Person (in the event of a sale or other disposition of all or substantially all
of the assets of such Subsidiary Guarantor), if other than a Subsidiary
Guarantor, shall have no obligation to assume or otherwise become liable under
such Guarantee; provided, that the Net Proceeds of such sale or other
disposition are applied in accordance with Section 4.10 hereof. Upon delivery by
the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel
to the effect that such sale or other disposition was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.10, such Subsidiary Guarantor shall ipso facto be released from its
obligations under its Guarantee and the Trustee shall execute any documents
reasonably required in order to evidence the release of any Subsidiary Guarantor
from its obligations under its Guarantee.
Any Subsidiary Guarantor not released from its obligations under its
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of such Subsidiary Guarantor under
this Indenture as provided in this Article 11.
Any Subsidiary Guarantor that is designated an Unrestricted Subsidiary in
accordance with the terms of this Indenture shall be released from and relieved
of its obligations under its Guarantee and any Unrestricted Subsidiary that
becomes a Restricted Subsidiary and any newly created or newly acquired
Subsidiary that is or becomes a Subsidiary shall be required to execute a
Guarantee in accordance with the terms of this Indenture.
Section 11.05. Limitation on Subsidiary Guarantor Liability.
For purposes hereof, each Subsidiary Guarantor's liability shall be that
amount from time to time equal to the aggregate liability of such Subsidiary
Guarantor thereunder, but shall be limited to the lesser of (i) the aggregate
amount of the Obligations of the Company under the Notes and this Indenture and
(ii) the amount, if any, which would not have (A) rendered such Subsidiary
Guarantor "insolvent" (as such term is defined in the Bankruptcy Code and in the
Debtor and Creditor Law of the State of New York) or (B) left it with
unreasonably small capital at the time its Guarantee of the Notes was entered
into, after giving effect to the incurrence of existing Indebtedness immediately
prior to such time; provided that, it shall be a presumption in any lawsuit or
other proceeding in which such Subsidiary Guarantor is a party that the amount
75
guaranteed pursuant to its Guarantee is the amount set forth in clause (i) above
unless any creditor, or representative of creditors of such Subsidiary
Guarantor, or debtor in possession or trustee in bankruptcy of such Subsidiary
Guarantor, otherwise proves in such a lawsuit that the aggregate liability of
such Subsidiary Guarantor is limited to the amount set forth in clause (ii). In
making any determination as to the solvency or sufficiency of capital of a
Subsidiary Guarantor in accordance with the previous sentence, the right of such
Subsidiary Guarantor to contribution from other Subsidiary Guarantors and any
other rights such Subsidiary Guarantor may have, contractual or otherwise, shall
be taken into account.
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 Article 10 and this Article 11 shall in such case (unless the context
shall otherwise require) be construed as extending to and including such Paying
Agent within its meaning as fully and for all intents and purposes as if such
Paying Agent were named in Article 10 and this Article 11 in place of the
Trustee.
Section 11.07. Subordination of Guarantees.
The obligations of each of the Subsidiary Guarantors under its Guarantee
pursuant to this Article 11 shall be junior and subordinated to the Senior Debt
of the Subsidiary Guarantor pursuant to Article 10 hereof. For the purposes of
the foregoing sentence, the Trustee and the Holders shall have the right to
receive and/or retain payments or distributions by or on behalf of any of the
Subsidiary Guarantors only at such times as they may receive and/or retain
payments in respect of the Notes pursuant to this Indenture, including Article
10 hereof.
Article 12
MISCELLANEOUS
Section 12.01. 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. If any
provisions of this Indenture modifies or excludes any provision of the TIA that
may be so modified or excluded, the latter provision shall be deemed to apply to
this Indenture as so modified or excluded, as the case may be.
Section 12.02. Notices.
Any notice or communication by the Company or the Subsidiary Guarantors or
the Trustee to the others is duly given if in writing and delivered, in Person
or mailed by first class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery,
to the others' address:
If to the Company or any Subsidiary Guarantor:
76
Range Resources Corporation
777 Main Street, Suite 800
Fort Worth, Texas 76102
Telecopier No.: (817) 810-1950
Attention: Rodney L. Waller
With a copy to:
Vinson & Elkins L.L.P.
3700 Trammell Crow Center
2001 Ross Avenue
Dallas, Texas 75201-2975
Telecopier No.: (214) 220-7716
Attention: Rodney L. Moore
If to the Trustee:
J.P. Morgan Trust Company, National Association
600 Travis Street, Suite 1150
Houston, Texas 77002-3009
Attention: Mary Jane Henson
Telecopier No.: (713) 216-2431
Ref: Range Resources Corporation
The Company or any Subsidiary Guarantor or the Trustee, by notice to the
others may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, first class
mail, certified or registered, return receipt requested, postage prepaid, if
mailed; when receipt acknowledged, if by telecopy; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA 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.
If the Company or any Subsidiary Guarantor mails a notice or communication
to Holders, it shall mail a copy to the Trustee and each Agent at the same time.
77
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
Subsidiary Guarantors, 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 or any Subsidiary Guarantor
to the Trustee to take any action under this Indenture, the Company or such
Subsidiary Guarantor, as the case may be, shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 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 complied with; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been complied with.
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 or
her to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
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.
78
Section 12.07. No Personal Liability of Directors, Officers,
Employees and Stockholders.
No director, officer, employee, incorporator or stockholder of the
Company, as such, shall have any liability for any obligations of the Company
under the Notes or this Indenture or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Notes, by
accepting a Note, waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes. Such waiver may not be
effective to waive liabilities under the federal securities laws and it is the
view of the Commission that such a waiver is against public policy.
Section 12.08. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE GUARANTEES.
Section 12.09. 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 their respective Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture and the Guarantees.
Section 12.10. Successors.
All agreements of the Company and each Subsidiary Guarantor in this
Indenture, the Notes and the Guarantees shall bind its respective successors.
All agreements of the Trustee in this Indenture shall bind its successors.
Section 12.11. Severability.
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 12.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 12.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted f or 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.
79
Section 12.14. Actions on Other than Business Days.
Unless otherwise provided herein, if the date for making any payment or
the last date for the performance of any act or the exercising of any right, as
provided in this Indenture, is not a Business Day, such payment may be made, act
performed or right exercised on the next succeeding Business Day, with the same
force and effect as if made or done on the nominal date provided therefor, and,
with respect to any payment so made, no interest shall accrue for the period
between such nominal date and the date of payment.
[Signatures on following page]
SIGNATURES
Dated as of
March 9, 2005
RANGE RESOURCES CORPORATION
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
PMOG HOLDINGS, INC.
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Range Energy I, Inc.
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Range HoldCo, Inc.
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Range Production Company
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Range Energy Ventures Corporation
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Gulfstar Energy, Inc.
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
Range Energy Finance Corporation
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
RB OPERATING COMPANY
Attest: By: /s/ Roger S. Manny
-----------------------------------------
Name: Roger S. Manny
--------------------------------------
Title: Senior Vice President and Chief
/s/ Rodney Waller Financial Officer
- --------------------- --------------------------------------
Rodney Waller
Secretary
J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee
By: /s/ Mary Jane Henson
-------------------------------------
Name: Mary Jane Henson
-------------------------------------
Title: Vice President
-------------------------------------
EXHIBIT A
[FACE OF NOTE]
RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated Note Due 2015
[CUSIP] [CINS] _______________
No. $_______________
RANGE RESOURCES CORPORATION, a Delaware corporation (the "COMPANY", which
term includes any successor under the Indenture hereinafter referred to), for
value received, promises to pay to ____________________, or its registered
assigns, the principal sum of ____________ DOLLARS ($______) [or such other
amount as indicated on the Schedule of Exchange of Notes attached hereto] on
March 15, 2015.
Interest Rate: 6 3/8% per annum.
Interest Payment Dates: March 15 and September 15, commencing September
15, 2005.1
Regular Record Dates: March 1 and September 1.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which will for all purposes have the same effect as if
set forth at this place.
- ----------
1 For Initial Notes only.
A-1
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
by its duly authorized officers.
Date: RANGE RESOURCES CORPORATION
By:
----------------------------
Name:
Title:
A-2
(Form of Trustee's Certificate of Authentication)
This is one of the 6 3/8% Senior/Subordinated Notes Due 2015 referred to
in the Indenture referred to in this Note.
J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION,
as Trustee
By:
----------------------
Authorized Signatory
Date of authentication:
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[REVERSE SIDE OF NOTE]
RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated Note Due 2015
1. Principal and Interest.
The Company promises to pay the principal of this Note on March 15, 2015.
The Company promises to pay interest on the principal amount of this Note
on each interest payment date, as set forth on the face of this Note, at the
rate of 6 3/8% per annum [(subject to adjustment as provided below)].(1)
Interest will be payable semiannually (to the holders of record of the
Notes at the close of business on the March 1 or September 1 immediately
preceding the interest payment date) on each interest payment date, commencing
September 15, 2005.(2)
[The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated March 9, 2005, between the Company and the Initial
Purchasers named therein (the "REGISTRATION RIGHTS AGREEMENT"). In the event
that (i) the Exchange Offer Registration Statement (as defined in the
Registration Rights Agreement) is not declared effective on or prior to the
180th day following the Closing Date (the "EFFECTIVENESS DEADLINE") or, if that
day is not a Business Day, the next day that is a Business Day, (ii) the
Exchange Offer is not consummated on or prior to the earlier of the 30th
Business Day following the date the Exchange Offer Registration Statement was
declared effective or the 210th day following the Closing Date, or, if that day
is not a Business Day, the next day that is a Business Day, or (iii) the Shelf
Registration Statement (as defined in the Registration Rights Agreement) is
required to be filed but is not declared effective by the later of 180 calendar
days after the Closing Date or 90 days after the Shelf Registration Statement is
required to be filed with the Commission, or, if either such day is not a
Business Day, the next day that is a Business Day, or is declared effective by
such date but thereafter ceases to be effective or usable, except if the Shelf
Registration Statement or the Exchange Offer Registration Statement ceases to be
effective or usable as specifically permitted by the penultimate paragraph of
Section 5 of the Registration Rights Agreement (each such event referred to in
clauses (i) through (iii) a "REGISTRATION DEFAULT"), liquidated damages in the
form of additional cash interest ("LIQUIDATED DAMAGES") will accrue on the
affected Notes and the affected Exchange Notes, as applicable, as provided in
the Registration Rights Agreement. The rate of Liquidated Damages will be 0.25%
per annum for the first 90-day period immediately following the occurrence of a
Registration Default, increasing by an additional 0.25% per annum with respect
to each subsequent 90-day period up to a maximum amount of additional interest
of 0.50% per annum, from and including the date on which any such Registration
Default shall occur to, but excluding, the earlier of (1) the date on which all
Registration Defaults have been
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(1) Include only for Initial Notes or Initial Additional Notes.
(2) May be modified for Additional Notes.
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cured or (2) the date on which all the Notes and Exchange Notes otherwise become
freely transferable by Holders other than affiliates of the Issuer without
further registration under the Securities Act.](2)
Interest on this Note will accrue from the most recent date to which
interest has been paid on this Note [or the Note surrendered in exchange for
this Note](3) (or, if there is no existing default in the payment of interest
and if this Note is authenticated between a regular record date and the next
interest payment date, from such interest payment date) or, if no interest has
been paid, from [the Closing Date].(4) Interest will be computed in the basis of
a 360-day year of twelve 30-day months.
The Company will pay interest on overdue principal, premium, if any, and,
to the extent lawful, interest at a rate per annum that is 1% in excess of
6 3/8%. Interest not paid when due and any interest on principal, premium or
interest not paid when due will be paid to the Persons that are Holders on a
special record date, which will be the 15th day preceding the date fixed by the
Company for the payment of such interest, whether or not such day is a Business
Day. At least 15 days before a special record date, the Company will send to
each Holder and to the Trustee a notice that sets forth the special record date,
the payment date and the amount of interest to be paid.
2. Indenture.
This is one of the Notes issued under an Indenture dated as of March 9,
2005 (as amended from time to time, the "Indenture"), among the Company, the
Subsidiary Guarantors party thereto and J.P. Morgan Trust Company, National
Association, as Trustee. Capitalized terms used herein are used as defined in
the Indenture unless otherwise indicated. 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. The Notes are subject to all such terms, and Holders are
referred to the Indenture and the Trust Indenture Act for a statement of all
such terms. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture will control.
The Notes are general unsecured obligations of the Company. The Indenture
limits the original aggregate principal amount of the Notes to $150,000,000, but
Additional Notes may be issued pursuant to the Indenture, and the originally
issued Notes and all such Additional Notes vote together for all purposes as a
single class.
3. Optional Redemption.
(a) The Notes are not redeemable at the Company's option prior to March
15, 2010. From and after March 15, 2010, the Notes will be subject to redemption
at the option of the
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(2) Include only for Initial Note or Initial Additional Note.
(3) Include only for Exchange Note.
(4) For Additional Notes, should be the date of their original issue.
A-5
Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest thereon to the applicable
redemption date, if redeemed during the twelve-month period beginning on March
15 of the years indicated below:
Year Percentage
-------------------- ----------
2010................ 103.188%
2011................ 102.125%
2012................ 101.063%
2013 and thereafter. 100.000%
(b) Notwithstanding the provisions of clause (a) of this paragraph 3,
prior to March 15, 2008 the Company may, at its option, on any one or more
occasions, redeem up to 35% of the original aggregate principal amount of Notes
at a redemption price equal to 106.375% of the principal amount thereof, plus
accrued and unpaid interest, if any, thereon to the redemption date, with the
net proceeds of sales of public Equity Interests of the Company; provided that
at least 65% of the original aggregate principal amount of Notes remain
outstanding immediately after the occurrence of such redemption; and provided,
further, that any such redemption shall occur within 60 days after the date of
the closing of the related sale of such Equity Interests.
4. Mandatory Redemption.
Except as set forth in paragraph 5 below, the Company shall not be
required to make mandatory redemption or sinking fund payments with respect to
the Notes.
5. Repurchase at Option of Holder.
(a) Upon the occurrence of a Change of Control, each Holder of Notes shall
have the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the
offer described below (the "Change of Control Offer") at an offer price in cash
equal to 101% of the aggregate principal amount thereof plus accrued and unpaid
interest, if any, thereon to the date of purchase (the "Change of Control
Payment"). The right of the Holders of the Notes to require the Company to
repurchase such Notes upon a Change of Control may not be waived by the Trustee
without the approval of the Holders of the Notes required by Section 9.02 of the
Indenture. Within 30 days following any Change of Control, the Company will mail
a notice to each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes pursuant to
the procedures required by the Indenture and described in such notice. The
Change of Control Payment shall be made on a Business Day not less than 30 days
nor more than 60 days after such notice is mailed. The Company and each
Subsidiary Guarantor will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change of Control.
(b) If the Company or a Restricted Subsidiary consummates any Asset Sales
permitted by the Indenture, when the aggregate amount of Excess Proceeds exceeds
$10.0
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million, the Company shall make an Asset Sale Offer to purchase the
maximum principal amount of Notes and any other pari passu Indebtedness to which
the Asset Sale Offer applies that may be purchased out of the Excess Proceeds,
at an offer price in cash in an amount equal to, in the case of the Notes, 100%
of the principal amount thereof, plus accrued and unpaid interest thereon to the
date of purchase or, in the case of any pari passu Indebtedness, 100% of the
principal amount thereof (or with respect to discount pari passu Indebtedness,
the accreted value thereof) on the date of purchase, in each case, in accordance
with the procedures set forth in Section 3.09 of the Indenture or the agreements
governing the pari passu Indebtedness, as applicable. To the extent that the
aggregate principal amount (or accreted value, as the case may be) of Notes and
pari passu Indebtedness tendered pursuant to an Asset Sale Offer is less than
the Excess Proceeds, the Company may use any remaining Excess Proceeds for
general corporate purposes. If the sum of (i) the aggregate principal amount of
Notes surrendered by Holders thereof and (ii) the aggregate principal amount or
accreted value, as the case may be, of pari passu Indebtedness surrendered by
holders or lenders thereof exceeds the amount of Excess Proceeds, the Trustee
and the trustee or other lender representative for the pari passu Indebtedness
shall select the Notes and the other pari passu Indebtedness to be purchased on
a pro rata basis, based on the aggregate principal amount (or accreted value, as
applicable) thereof surrendered in such Asset Sale Offer. Upon completion of
such Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.
6. Notice of Redemption. Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 may be redeemed in part but only in integral multiples of
$1,000, unless all of the Notes held by a Holder are to be redeemed. On and
after the redemption date interest will cease to accrue on the aggregate
principal amount of the Notes called for redemption.
7. Registered Form; Denominations; Transfer; Exchange.
The Notes are in registered form without coupons in denominations of
$1,000 principal amount and any multiple of $1,000 in excess thereof. A Holder
may register the transfer or exchange of Notes in accordance with the Indenture.
The Trustee may require a Holder to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. Pursuant to the Indenture, there are certain periods during which
the Trustee will not be required to issue, register the transfer of or exchange
any Note or certain portions of a Note.
8. Persons Deemed Owners. The registered Holder of a Note shall be treated
as its owner for all purposes.
9. Amendment, Supplement and Waiver. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of the Notes then
outstanding (including, without limitation, consents obtained in connection with
a purchase of, or the tender offer or exchange offer for, such Notes), and any
existing Default or Event of Default under, or compliance with any provision of
the Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes. Without the consent
of any Holder of
A-7
a Note, the Indenture or the Notes may be amended on supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the assumption of
the Company's obligations to Holders of the Notes in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the Trust Indenture Act.
10. Defaults and Remedies. Events of Default include: (i) default for 30
consecutive days in the payment when due of interest on the Notes (whether or
not prohibited by the provisions of Article 10 of the Indenture); (ii) default
in payment when due of the principal of or premium, if any, on the Notes
(whether or not prohibited by the provisions of Article 10 of the Indenture);
(iii) failure by the Company to comply with the provisions of Article 5 of the
Indenture; (iv) failure by the Company for 30 consecutive days after notice from
the Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding to comply with the provisions of Sections 4.03, 4.07,
4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.16 and 4.17 of the Indenture; (v)
failure by the Company for 60 consecutive days after notice from the Trustee or
the Holders of at least 25% in aggregate principal amount of the Notes then
outstanding to comply with any of its other agreements or covenants in, or
provisions of, this Note or in the Indenture; (vi) except as permitted by the
Indenture, any Guarantee shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any reason to be in full force and
effect or a Subsidiary Guarantor, or any Person acting on behalf of a Subsidiary
Guarantor, shall deny or disaffirm such Subsidiary Guarantor's obligations under
its Guarantee; (vii) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any Restricted Subsidiary,
whether such Indebtedness or guarantee now exists, or is created after the date
of the Indenture, which default (a) is caused by a failure to pay principal of
or premium, if any, or interest, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of such
default (a "Payment Default") or (b) results in the acceleration of such
Indebtedness prior to its express maturity and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there is then existing a Payment Default or the
maturity of which has been so accelerated, aggregates $10.0 million or more;
provided, that if any such default is cured or waived or any such acceleration
rescinded, or such Indebtedness is repaid, within a period of 10 days from the
continuation of such default beyond the applicable grace period or the
occurrence of such acceleration, as the case may be, such Event of Default under
the Indenture and any consequential acceleration of the Notes shall be
automatically rescinded; (viii) a final non-appealable judgment or order or
final non-appealable judgments or orders are rendered against the Company or any
Restricted Subsidiary that remain unpaid or discharged for a period of 60 days
and that require the payment in money, either individually or in an aggregate
amount, that is more than $10.0 million; and (ix) certain events of bankruptcy
or insolvency with respect to the Company or any Significant Subsidiary or any
group of Subsidiaries that, taken together, would constitute a Significant
Subsidiary. If any Event of Default (other than an Event of Default described in
clause (ix) above) occurs and is continuing, the Trustee or the Holders of at
least 25% in principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. Notwithstanding. the foregoing, in the
case of an Event of Default arising
A-8
from certain events of bankruptcy or insolvency with respect to the Company, any
Significant Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary, all outstanding Notes will become due and
payable without further action or notice. Holders of the Notes may not enforce
the Indenture or the Notes except as provided in the Indenture. Subject to
certain limitations, Holders of a majority in principal amount of the then
outstanding Notes may direct the Trustee in its exercise of any trust or power.
The Trustee may withhold from Holders of the Notes notice of any continuing
Default or Event of Default (except a Default or Event of Default relating to
the payment of principal or interest) if it determines that withholding notice
is in their interest. The Holders of a majority in aggregate principal amount of
the Notes then outstanding by notice to the Trustee may on behalf of the Holders
of all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of interest or premium on, or the principal of, the Notes. The
Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required, within 5 Business
days after becoming aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default or Event of Default.
11. Subordination. The Notes are subordinated to Senior Debt of the
Company. To the extent provided in the Indenture, Senior Debt must be paid
before the Notes may be paid. The Company agrees, and each Holder by accepting a
Note agrees, that the Indebtedness evidenced by the Notes, including, but not
limited to, the payment of principal of, premium, if any, and interest on the
Notes, and any other payment Obligation of the Company in respect of the Notes
is subordinated in right of payment, to the extent and in the manner provided in
the Indenture, to the prior payment in full in cash of all Senior Debt of the
Company (whether outstanding on the date hereof or hereafter created, incurred,
assumed or guaranteed) and authorizes the Trustee to give effect and appoints
the Trustee as attorney-in-fact for such purpose.
12. Trustee Dealings with Company. The Indenture contains certain
limitations on the rights of the Trustee, should it become a creditor of the
Company, to obtain payment of claims in certain cases, or to realize on certain
property received in respect of any such claim as security or otherwise. The
Trustee will be permitted to engage in other transactions; however, if it
acquires any conflicting interest it must eliminate such conflict within 90
days, apply to the Commission for permission to continue or resign.
13. No Recourse Against Others. No director, officer, employee,
incorporator or stockholder of the Company, as such, shall have any liability
for any obligations of the Company under the Notes or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of Notes, by accepting a Note, waives and releases all
such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities
under the federal securities laws and it is the view of the Commission that such
a waiver is against public policy.
14. Authentication.
This Note is not valid until the Trustee (or Authenticating Agent) signs
the certificate of authentication on the other side of this Note.
A-9
15. Governing Law.
This Note shall be governed by, and construed in accordance with, the laws
of the State of New York.
16. Abbreviations.
Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian) and U/G/M/A/ (= Uniform Gifts to Minors
Act).
The Company will furnish a copy of the Indenture to any Holder upon
written request and without charge.
[NOTE: THE FORM OF GUARANTEE ATTACHED AS EXHIBIT I TO THE INDENTURE IS TO BE
ATTACHED TO THIS NOTE.]
A-10
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
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Insert Taxpayer Identification No.
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Please print or typewrite name and address including zip code of assignee
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the within Note and all rights thereunder, hereby irrevocably
constituting and appointing
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attorney to transfer said Note on the books of the Company with full power of
substitution in the premises.
A-11
[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL CERTIFICATES BEARING A RESTRICTED
LEGEND]
In connection with any transfer of this Note, the undersigned confirms
that such transfer is made without utilizing any general solicitation or general
advertising and further as follows:
Check One
[ ] (1) This Note is being transferred to a "qualified institutional buyer" in
compliance with Rule 144A under the Securities Act of 1933, as amended and
certification in the form of Exhibit F to the Indenture is being furnished
herewith.
[ ] (2) This Note is being transferred to a Non-U.S. Person in compliance with
the exemption from registration under the Securities Act of 1933, as amended,
provided by Regulation S thereunder, and certification in the form of Exhibit E
to the Indenture is being furnished herewith.
or
[ ] (3) This Note is being transferred other than in accordance with (1) or
(2) above and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee is not obligated to
register this Note in the name of any Person other than the Holder hereof unless
and until the conditions to any such transfer of registration set forth herein
and in the Indenture have been satisfied.
Date:
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--------------------------------
Seller
By
-----------------------------
NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the
within-mentioned instrument in every particular, without
alteration or any change whatsoever.
A-12
Signature Guarantee:(5)
-----------------------------------------
By:(3)
---------------------------------
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(5) Signatures must be guaranteed by an "ELIGIBLE GUARANTOR INSTITUTION"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Securities Transfer Association 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.
(3) To be executed by an executive officer
A-13
OPTION OF HOLDER TO ELECT PURCHASE
(a) If the Holder hereof wishes to have all of this Note purchased by the
Company pursuant to Section 4.10 of the Indenture (Asset Sales) or Section 4.13
of the Indenture (Offer to Repurchase Notes Upon a Change of Control) of the
Indenture, check the box: 9
If the Holder hereof wishes wish to have a portion of this Note purchased
by the Company pursuant to Section 4.10 of the Indenture (Asset Sales) or
Section 4.13 of the Indenture (Offer to Repurchase Notes Upon a Change of
Control) of the Indenture, state the amount (in original principal amount)
below:
$ .
---------------------
Date:
----------
Your Signature:
-------------------
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:(1)
--------------------------------------
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(1) Signatures must be guaranteed by an "ELIGIBLE GUARANTOR INSTITUTION"
meeting the requirements of the Trustee, which requirements include membership
or participation in the Securities Transfer Association Medallion Program
("STAMP") or such other "SIGNATURE GUARANTEE PROGRAM" as may be determined by
the Trustee in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
A-14
SCHEDULE OF EXCHANGES OF NOTES(1)
The following exchanges of interests in this Global Note for Certificated Notes
or interests in another Global Note have been made:
PRINCIPAL AMOUNT OF
THIS GLOBAL NOTE
AMOUNT OF DECREASE AMOUNT OF INCREASE FOLLOWING SUCH SIGNATURE OF
IN PRINCIPAL AMOUNT IN PRINCIPAL AMOUNT DECREASE (OR AUTHORIZED OFFICER OF
DATE OF EXCHANGE OF THIS GLOBAL NOTE OF THIS GLOBAL NOTE INCREASE) TRUSTEE
---------------- ------------------- ------------------- ------------------- ---------------------
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(1) For Global Notes
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EXHIBIT B
RESERVED
B-1
EXHIBIT C
RESTRICTED LEGEND
THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF RANGE RESOURCES
CORPORATION, THAT (A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
C-1
EXHIBIT D
DTC LEGEND
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), 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 DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS A BENEFICIAL INTEREST HEREIN.
[TRANSFERS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS IN WHOLE, BUT NOT
IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE TRANSFER PROVISIONS OF THE INDENTURE.]
D-1
EXHIBIT E
Regulation S Certificate
---------, ----
J.P. Morgan Trust Company, National Association
600 Travis Street, Suite 1150
Houston, Texas 77002-3009
Attention: Mary Jane Henson
Re: RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated
Notes due 2015 (the "NOTES")
Issued under the Indenture (the "INDENTURE") dated as
as of March 9, 2005 relating to the Notes
Ladies and Gentlemen:
Terms are used in this Certificate as used in Regulation S ("Regulation
S") under the Securities Act of 1933, as amended (the "Securities Act"), except
as otherwise stated herein.
[CHECK A OR B AS APPLICABLE.]
[ ]A. This Certificate relates to our proposed transfer of $____ principal
amount of Notes issued under the Indenture. We hereby certify as
follows:
1. The offer and sale of the Notes was not and will not be made
to a person in the United States (unless such person is
excluded from the definition of "U.S. person" pursuant to Rule
902(k)(2)(vi) or the account held by it for which it is acting
is excluded from the definition of "U.S. person" pursuant to
Rule 902(k)(2)(i) under the circumstances described in Rule
902(h)(3)) and such offer and sale was not and will not be
specifically targeted at an identifiable group of U.S.
citizens abroad.
2. Unless the circumstances described in the parenthetical in
paragraph 1 above are applicable, either (a) at the time the
buy order was originated, the buyer was outside the United
States or we and any person acting on our behalf reasonably
believed that the buyer was outside the United States or (b)
the transaction was executed in, on or through the facilities
of a designated offshore securities market, and neither we nor
any person acting on our behalf knows that the transaction was
pre-arranged with a buyer in the United States.
E-1
3. Neither we, any of our affiliates, nor any person acting on
our or their behalf has made any directed selling efforts in
the United States with respect to the Notes.
4. The proposed transfer of Notes is not part of a plan or scheme
to evade the registration requirements of the Securities Act.
5. If we are a dealer or a person receiving a selling concession,
fee or other remuneration in respect of the Notes, and the
proposed transfer takes place during the Restricted Period (as
defined in the Indenture), or we are an officer or director of
the Company or an Initial Purchaser (as defined in the
Indenture), we certify that the proposed transfer is being
made in accordance with the provisions of Rule 904(b) of
Regulation S.
[ ]B. This Certificate relates to our proposed exchange of $____ principal
amount of Notes issued under the Indenture for an equal principal
amount of Notes to be held by us. We hereby certify as follows:
1. At the time the offer and sale of the Notes was made to us,
either (i) we were not in the United States or (ii) we were
excluded from the definition of "U.S. person" pursuant to Rule
902(k)(2)(vi) or the account held by us for which we were
acting was excluded from the definition of "U.S. person"
pursuant to Rule 902(k)(2)(i) under the circumstances
described in Rule 902(h)(3); and we were not a member of an
identifiable group of U.S. citizens abroad.
2. Unless the circumstances described in paragraph 1(ii) above
are applicable, either (a) at the time our buy order was
originated, we were outside the United States or (b) the
transaction was executed in, on or through the facilities of a
designated offshore securities market and we did not
pre-arrange the transaction in the United States.
3. The proposed exchange of Notes is not part of a plan or scheme
to evade the registration requirements of the Securities Act.
E-2
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[NAME OF SELLER (FOR TRANSFERS)
OR OWNER (FOR EXCHANGES)]
By: ____________________________________
Name:
Title:
Address:
Date: _________________
E-3
EXHIBIT F
Rule 144A Certificate
---------, ----
J.P. Morgan Trust Company, National Association
600 Travis Street, Suite 1150
Houston, Texas 77002-3009
Attention: Mary Jane Henson
Re: RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated
Notes due 2015 (the "NOTES")
Issued under the Indenture (the "INDENTURE") dated as
as of March 9, 2005 relating to the Notes
Ladies and Gentlemen:
TO BE COMPLETED BY PURCHASER IF (1) ABOVE IS CHECKED.
This Certificate relates to:
[CHECK A OR B AS APPLICABLE.]
[ ]A. Our proposed purchase of $____ principal amount of Notes issued
under the Indenture.
[ ]B. Our proposed exchange of $____ principal amount of Notes issued
under the Indenture for an equal principal amount of Notes to be
held by us.
We and, if applicable, each account for which we are acting in the
aggregate owned and invested more than $100,000,000 in securities of issuers
that are not affiliated with us (or such accounts, if applicable), as of
_________, 200_, which is a date on or since close of our most recent fiscal
year. We and, if applicable, each account for which we are acting, are a
qualified institutional buyer within the meaning of Rule 144A ("Rule 144A")
under the Securities Act of 1933, as amended (the "Securities Act"). If we are
acting on behalf of an account, we exercise sole investment discretion with
respect to such account. We are aware that the transfer of Notes to us, or such
exchange, as applicable, is being made in reliance upon the exemption from the
provisions of Section 5 of the Securities Act provided by Rule 144A. Prior to
the date of this Certificate we have received such information regarding the
Company as we have requested pursuant to Rule 144A(d)(4) or have determined not
to request such information.
F-1
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[NAME OF PURCHASER (FOR TRANSFERS)
OR OWNER (FOR EXCHANGES)]
By: __________________________________
Name:
Title:
Address:
Date: _________________
F-2
EXHIBIT G
[COMPLETE FORM I OR FORM II AS APPLICABLE.]
[FORM I]
Certificate of Beneficial Ownership
To: J.P. Morgan Trust Company, National Association
600 Travis Street, Suite 1150
Houston, Texas 77002-3009
Attention: Mary Jane Henson or
[Name of DTC Participant]]
Re: RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated
Notes due 2015 (the "NOTES")
Issued under the Indenture (the "INDENTURE") dated as
as of March 9, 2005 relating to the Notes
Ladies and Gentlemen:
We are the beneficial owner of $____ principal amount of Notes issued
under the Indenture and represented by a Temporary Offshore Global Note (as
defined in the Indenture).
We hereby certify as follows:
[CHECK A OR B AS APPLICABLE.]
[ ]A. We are a non-U.S. person (within the meaning of Regulation S under
the Securities Act of 1933, as amended).
[ ]B. We are a U.S. person (within the meaning of Regulation S under the
Securities Act of 1933, as amended) that purchased the Notes in a
transaction that did not require registration under the Securities
Act of 1933, as amended.
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
G-1
Very truly yours,
[NAME OF BENEFICIAL OWNER]
By: __________________________________
Name:
Title:
Address:
Date: _________________
[FORM II]
Certificate of Beneficial Ownership
To: J.P. Morgan Trust Company, National Association
600 Travis Street, Suite 1150
Houston, Texas 77002-3009
Attention: Mary Jane Henson
Re: RANGE RESOURCES CORPORATION
6 3/8% Senior Subordinated
Notes due 2015 (the "NOTES")
Issued under the Indenture (the "INDENTURE") dated as
as of March 9, 2005 relating to the Notes
Ladies and Gentlemen:
This is to certify that based solely on certifications we have received in
writing, by tested telex or by electronic transmission from institutions
appearing in our records as persons being entitled to a portion of the principal
amount of Notes represented by a Temporary Offshore Global Note issued under the
above-referenced Indenture, that as of the date hereof, $____ principal amount
of Notes represented by the Temporary Offshore Global Note being submitted
herewith for exchange is beneficially owned by persons that are either (i)
non-U.S. persons (within the meaning of Regulation S under the Securities Act of
1933, as amended) or (ii) U.S. persons that purchased the Notes in a transaction
that did not require registration under the Securities Act of 1933, as amended.
We further certify that (i) we are not submitting herewith for exchange
any portion of such Temporary Offshore Global Note excepted in such
certifications and (ii) as of the date hereof we have not received any
notification from any institution to the effect that the statements made by such
Institution with respect to any portion of such Temporary Offshore Global Note
submitted herewith for exchange are no longer true and cannot be relied upon as
of the date hereof.
G-2
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Yours faithfully,
[Name of DTC Participant]
By: __________________________________
Name:
Title:
Address:
Date: _________________
G-3
EXHIBIT H
Temporary Offshore Global Note Legend
THIS NOTE IS A TEMPORARY GLOBAL NOTE. PRIOR TO THE EXPIRATION OF THE RESTRICTED
PERIOD APPLICABLE HERETO, BENEFICIAL INTERESTS HEREIN MAY NOT BE HELD BY ANY
PERSON OTHER THAN (1) A NON-U.S. PERSON OR (2) A U.S. PERSON THAT PURCHASED SUCH
INTEREST IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"). BENEFICIAL INTERESTS HEREIN ARE NOT
EXCHANGEABLE FOR PHYSICAL NOTES OTHER THAN A PERMANENT GLOBAL NOTE IN ACCORDANCE
WITH THE TERMS OF THE INDENTURE. TERMS IN THIS LEGEND ARE USED AS USED IN
REGULATION S UNDER THE SECURITIES ACT.
NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE
PAYMENT OF PRINCIPAL OR INTEREST HEREON UNTIL SUCH BENEFICIAL INTEREST IS
EXCHANGED OR TRANSFERRED FOR AN INTEREST IN ANOTHER NOTE.
H-1
EXHIBIT I
Guarantee
Each of the Subsidiary Guarantors hereby, jointly and severally and
unconditionally guarantees to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns, irrespective
of the validity and enforceability of this Indenture, the Notes or the
obligations of the Company hereunder or thereunder, that: (a) the principal of,
and premium and interest on, the Notes shall be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of, and interest on premium and interest on, the Notes, if
any, if lawful, and all other obligations of the Company to the Holders or the
Trustee hereunder or thereunder shall be promptly paid in full or performed, all
in accordance with the terms hereof and thereof; and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, that same shall be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately.
The obligations of the Subsidiary Guarantors to the Holders of Notes and
to the Trustee pursuant to this Guarantee and the Indenture (including the
subordination provisions thereof) are expressly set forth in Article 11 of the
Indenture, and reference is hereby made to such Indenture for the precise terms
of this Guarantee. The terms of Article 11 of the Indenture are incorporated
herein by reference.
This is a continuing Guarantee and shall remain in full force and effect
and shall be binding upon each of the Subsidiary Guarantors and its respective
successors and assigns to the extent set forth in the Indenture until full and
final payment of all of the Company's Obligations under the Notes and the
Indenture and shall inure to the benefit of the Trustee and the Holders of Notes
and their successors and assigns and, in the event of any transfer or assignment
of rights by any Holder of Notes or the Trustee, the rights and privileges
herein conferred upon that party shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.
Notwithstanding the foregoing, any Subsidiary Guarantor that satisfies the
provisions of Section 11.04 of the Indenture shall be released of its
obligations hereunder. This is a Guarantee of payment and not a, guarantee of
collection.
This Guarantee shall not be valid or obligatory for any purpose until the
certificate of authentication on the Note upon which this Guarantee is noted
shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
For purposes hereof, each Subsidiary Guarantor's liability will be that
amount from time to time equal to the aggregate liability of such Subsidiary
Guarantor hereunder but shall be limited to the lesser of (i) the aggregate
amount of the obligations of the Company under the Notes and the Indenture and
(ii) the amount, if any, which would not have (A) rendered such
Subsidiary Guarantor "insolvent" (as such term is defined in the federal
Bankruptcy Code and in the Debtor and Creditor law of the State of New York) or
(B) left it with unreasonably small capital at the time its Guarantee was
entered into, after giving effect to the incurrence of existing Indebtedness
immediately prior to such time; provided that, it shall be a presumption in any
lawsuit or other proceeding in which such Subsidiary Guarantor is a party that
the amount guaranteed pursuant to its Guarantee is the amount set forth in
clause (i) above unless any creditor, or representative of creditors of such
Subsidiary Guarantor, or debtor in possession or trustee in bankruptcy of such
Subsidiary Guarantor, otherwise proves in such a lawsuit that the aggregate
liability of such Subsidiary Guarantor is limited to the amount set forth in
clause (ii). The Indenture provides that, in making any determination as to the
solvency or sufficiency of capital of a Subsidiary Guarantor in accordance with
the previous sentence, the right of such Subsidiary Guarantor to contribution
from other Subsidiary Guarantors and any other rights such Subsidiary Guarantor
may have, contractual or otherwise, shall be taken into account.
Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
RANGE ENERGY I, INC.
By: _____________________________
Name: _____________________________
Title: _____________________________
PMOG HOLDINGS, INC.
By: _____________________________
Name: _____________________________
Title: _____________________________
Range HoldCo, Inc.
By: _____________________________
Name: _____________________________
Title: _____________________________
3
Range Production Company
By: _____________________________
Name: _____________________________
Title: _____________________________
Range Energy Ventures
Corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
Gulfstar Energy, Inc.
By: _____________________________
Name: _____________________________
Title: _____________________________
Range Energy Finance Corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
RB OPERATING COMPANY
By: _____________________________
Name: _____________________________
Title: _____________________________
4