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EXHIBIT 4.14
FORM OF COMMON SECURITIES GUARANTEE AGREEMENT
K N Capital Trust III
Dated as of ___________, ____
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TABLE OF CONTENTS
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ARTICLE I.
DEFINITIONS AND INTERPRETATION..................... 3
SECTION A. Definitions and Interpretation........................... 3
ARTICLE II.
GUARANTEE............................... 5
SECTION A. Guarantee.......................................... 5
SECTION B. Subordination...................................... 5
SECTION C. Waiver of Notice and Demand........................ 5
SECTION D. Obligations Not Affected........................... 5
SECTION E. Rights of Holders.................................. 6
SECTION F. Guarantee of Payment............................... 6
SECTION G. Subrogation........................................ 6
SECTION H. Independent Obligations............................ 7
ARTICLE III.
LIMITATION OF TRANSACTIONS; RANKING................ 7
SECTION A. Limitation of Transactions......................... 7
SECTION B. Ranking............................................ 7
ARTICLE IV.
TERMINATION.............................. 8
SECTION A. Termination........................................ 8
ARTICLE V.
MISCELLANEOUS............................. 8
SECTION A. Successors and Assigns............................. 8
SECTION B. Amendments......................................... 8
SECTION C. Notices............................................ 8
SECTION D. Benefit............................................ 9
SECTION E. Governing Law...................................... 9
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FORM OF COMMON SECURITIES GUARANTEE AGREEMENT
This FORM OF COMMON SECURITIES GUARANTEE AGREEMENT (the "Common
Securities Guarantee"), dated as of ________ __, ____, is executed and delivered
by K N Energy, Inc., a Kansas corporation (the "Guarantor"), for the benefit of
the Holders (as defined herein) from time to time of the Common Securities (as
defined herein) of K N Capital Trust III, a Delaware business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of the date hereof, among the trustees and
administrators of the Issuer named therein, the Guarantor, as sponsor, and the
holders from time to time of undivided beneficial interests in the assets of the
Issuer, the Issuer is issuing on the date hereof _____ common securities, having
an aggregate liquidation amount of $_________, designated the Common Securities
(collectively the "Common Securities");
WHEREAS, the Common Securities are being issued by the Issuer and
the proceeds thereof, together with the proceeds from the issuance of the
Issuer's Preferred Securities (as defined in the Declaration), will be used to
purchase the Debentures (as defined in the Declaration) of the
Guarantor, which will be deposited with Wilmington Trust Company, as
Institutional Trustee under the Declaration, as trust assets;
WHEREAS, as an incentive for the Holders to purchase the Common
Securities, the Guarantor desires to irrevocably and unconditionally agree, to
the extent set forth in this Common Securities Guarantee, to pay to the Holders
of the Common Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein; and
WHEREAS, as of the date hereof, the Guarantor is also executing and
delivering a guarantee agreement (the "Preferred Securities Guarantee") with
substantially identical terms to this Common Securities Guarantee for the
benefit of the holders of the Preferred Securities, except that if an Event of
Default (as defined in the Indenture), has occurred and is continuing, the
rights of Holders of the Common Securities to receive Guarantee Payments under
this Common Securities Guarantee are subordinated to the rights of holders of
Preferred Securities to receive Guarantee Payments under the Preferred
Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Common Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Common Securities Guarantee
for the benefit of the Holders.
ARTICLE I.
DEFINITIONS AND INTERPRETATION
SECTION A. Definitions and Interpretation. In this Common Securities
Guarantee, unless the context otherwise requires:
1. capitalized terms used in this Common Securities Guarantee but
not defined in the preamble above have the respective meanings assigned to them
in this Section 1.1;
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2. terms defined in the Declaration as at the date of execution of
this Common Securities Guarantee have the same meaning when used in this Common
Securities Guarantee unless otherwise defined in this Common Securities
Guarantee;
3. a term defined anywhere in this Common Securities Guarantee has
the same meaning throughout;
4. all references to "the Common Securities Guarantee" or "this
Common Securities Guarantee" are to this Common Securities Guarantee as
modified, supplemented or amended from time to time;
5. all references in this Common Securities Guarantee to Articles
and Sections are to Articles and Sections of this Common Securities Guarantee,
unless otherwise specified; and
6. a reference to the singular includes the plural and vice versa.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Common Securities, to the extent not
paid or made by the Issuer: (i) any accumulated and unpaid distributions that
are required to be paid on such Common Securities to the extent the Issuer shall
have funds available therefor, (ii) the redemption price (the "Redemption
Price"), plus all accumulated and unpaid distributions to the date of redemption
with respect to any Common Securities called for redemption by the Issuer, to
the extent the Issuer has funds available therefor and (iii) upon a voluntary or
involuntary liquidation, dissolution, winding-up or termination of the Issuer
(other than in connection with a distribution of the Debentures to the Holders
or the redemption of all the Common Securities), the lesser of (a) the aggregate
of liquidation amount and all accumulated and unpaid distributions on the Common
Securities to the date of payment, to the extent the Issuer has funds available
therefor, and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer (in either case, the
"Liquidation Distribution"). If an Event of Default has occurred and is
continuing, the rights of Holders of the Common Securities to receive Guarantee
Payments under this Common Securities Guarantee are subordinated to the rights
of holders of Preferred Securities to receive guarantee payments under the
Preferred Securities Guarantee.
"Holder" means any holder, as registered on the books and records of
the Issuer, of any Common Securities.
"Majority in Liquidation Amount" of the Common Securities means,
except as provided in the terms of the Common Securities, a vote by Holder(s),
voting separately as a class, of more than 50% of the Liquidation Amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid distributions to the date upon which the
voting percentages are determined) of all Common Securities.
"Trust Securities" means the Common Securities and the Preferred
Securities.
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ARTICLE II.
GUARANTEE
SECTION A. Guarantee. The Guarantor irrevocably and unconditionally
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by the Issuer), as and when due, regardless of any
defense, right of set-off or counterclaim that the Issuer may have or assert.
The Guarantor's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION B. Subordination. If an Event of Default (as defined in the
Declaration) has occurred and is continuing, the rights of the Holders of the
Common Securities to receive Guarantee Payments under this Common Securities
Guarantee are subordinated to the rights of the Holders of the Preferred
Securities to receive guarantee payments under the Preferred Securities
Guarantee.
SECTION C. Waiver of Notice and Demand. The Guarantor hereby waives
notice of acceptance of this Common Securities Guarantee and of any liability to
which it applies or may apply, presentment, demand for payment, any right to
require a proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION D. Obligations Not Affected. The obligations, covenants,
agreements and duties of the Guarantor under this Common Securities Guarantee
shall in no way be affected or impaired by reason of the happening from time to
time of any of the following:
1. the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Common Securities to be performed or
observed by the Issuer;
2. the extension of time for the payment by the Issuer of all or any
portion of the distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Common Securities or the extension of
time for the performance of any other obligation under, arising out of, or in
connection with, the Common Securities (other than an extension of time for
payment of distributions, the Redemption Price, Liquidation Distribution or
other sum payable that results from the extension of any interest payment period
on the Debentures permitted by the Indenture);
3. any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Common Securities, or any
action on the part of the Issuer granting indulgence or extension of any kind;
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4. the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
5. any invalidity of, or defect or deficiency in, the Common
Securities;
6. the settlement or compromise of any obligation guaranteed hereby
or hereby incurred;
7. any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 2.4 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION E. Rights of Holders. The Guarantor expressly acknowledges
that any Holder of Common Securities may institute a legal proceeding directly
against the Guarantor to enforce its rights under this Common Securities
Guarantee, without first instituting a legal proceeding against the Issuer, the
Guarantee Trustee or any other person or entity.
SECTION F. Guarantee of Payment. This Common Securities Guarantee
creates a guarantee of payment and not of collection.
SECTION G. Subrogation. The Guarantor shall be subrogated to all (if
any) rights of the Holders of Common Securities against the Issuer in respect of
any amounts paid to such Holders by the Guarantor under this Common Securities
Guarantee; provided, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Common
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Common Securities Guarantee. If any amount shall be paid
to the Guarantor in violation of the preceding sentence, the Guarantor agrees to
hold such amount in trust for the Holders and to pay over such amount to the
Holders. If an Event of Default has occurred and is continuing, the rights of
Holders of the Common Securities to receive Guarantee Payments under this Common
Securities Guarantee are subordinated to the rights of holders of Preferred
Securities to receive Guarantee Payments under the Preferred Securities
Guarantee
SECTION H. Independent Obligations. The Guarantor acknowledges that
its obligations hereunder are independent of the obligations of the Issuer with
respect to the Common Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Common Securities Guarantee notwithstanding the occurrence of any
event referred to in subsections (a) through (g), inclusive, of Section 2.4
hereof.
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ARTICLE III.
LIMITATION OF TRANSACTIONS; RANKING
SECTION A. Limitation of Transactions. So long as any Preferred
Securities remain outstanding, if (i) the Guarantor has exercised its option to
defer interest payments on the Debentures by extending the interest payment
period and such extension shall be continuing, (ii) the Guarantor shall be in
default with respect to its Guarantee Payments or other obligations under this
Common Securities Guarantee or (iii) there shall have occurred and be continuing
any event that, with the giving of notice, would constitute an Event of Default
(as defined in the Declaration) then the Guarantor (i) shall not declare or pay
any dividend on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its capital stock
(other than (i) purchases or acquisitions of shares of its common stock in
connection with the satisfaction by the Guarantor or any of its subsidiaries of
their respective obligations under any benefit plans for directors, officers,
agents or employees of the Guarantor's dividend reinvestment or director,
officer, agent or employee stock purchase plans, (ii) as a result of a
reclassification of its capital stock or the exchange or conversion of one class
or series of its capital stock for another class or series of its capital stock,
(iii) the purchase of fractional interests in shares of its capital stock
pursuant to the conversion or exchange provisions of such capital stock or
security being converted or exchanged for its capital stock, (iv) dividends or
distributions in the form of shares of, or options, warrants or rights to
subscribe for or purchase shares of capital stock of the Guarantor or (v) any
declaration of a dividend in connection with the implementation or extension of
a stockholders' rights plan, or the issuance of stock under any such plan
(including any such existing plan) in the future or the redemption or repurchase
or any such rights pursuant thereto), (b) shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities issued by the Guarantor which rank pari passu with or junior to
the Debentures and (c) the Guarantor shall not make any guarantee payments with
respect to any guarantee by the Guarantor of any securities of any subsidiary of
the Guarantor if such guarantee ranks pari passu with or junior in right of
payment to the Debentures.
SECTION B. Ranking. This Common Securities Guarantee will constitute
an unsecured obligation of the Guarantor and will rank pari passu in right of
payment to all other senior unsecured obligations of the Guarantor.
ARTICLE IV.
TERMINATION
SECTION A. Termination. This Common Securities Guarantee shall
terminate as to each Holder upon (i) full payment of the Redemption Price and
accrued and unpaid distributions with respect to all Common Securities, (ii)
upon the distribution of the
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Debentures held by the Trust to the Holders of the Common Securities or (iii)
upon dissolution of the Trust and will terminate completely upon full payment of
the amounts payable in accordance with the Declaration. Notwithstanding the
foregoing, this Common Securities Guarantee will continue to be effective or
will be reinstated, as the case may be, if at any time any Holder of Common
Securities must restore payment of any sums paid under the Common Securities or
under this Common Securities Guarantee.
ARTICLE V.
MISCELLANEOUS
SECTION A. Successors and Assigns. All guarantees and agreements
contained in this Common Securities Guarantee shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Common Securities then outstanding.
Except in connection with any permitted merger or consolidation of the Guarantor
with or into another entity or any permitted sale, transfer or lease of the
Guarantor's assets to another entity (as described in Article 7 of the
Indenture), the Guarantor may not assign its rights or delegate its obligations
under the Guarantee without the prior approval of the Holders of at least a
Majority in Liquidation Amount of the Common Securities then outstanding.
SECTION B. Amendments. Except with respect to any changes that do
not materially adversely affect the rights of Holders (in which case no consent
of Holders will be required), this Common Securities Guarantee may only be
amended with the prior approval of the Holders of at least a Majority in
Liquidation Amount of the Common Securities. The provisions of Section 12.2 of
the Declaration with respect to meetings of Holders of the Securities apply to
the giving of such approval.
SECTION C. Notices. All notices provided for in this Common
Securities Guarantee shall be in writing, duly signed by the party giving such
notice, and shall be delivered, telecopied or mailed by first class mail, as
follows:
1. if given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Common Securities):
K N Energy, Inc.
000 Xxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
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2. if given to any Holder of Common Securities, at the address set
forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION D. Benefit. This Common Securities Guarantee is solely for
the benefit of the Holders of the Common Securities and is not separately
transferable from the Common Securities.
SECTION E. Governing Law. THIS COMMON SECURITIES GUARANTEE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
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THIS COMMON SECURITIES GUARANTEE AGREEMENT is executed as of the day
and year first above written.
K N ENERGY, INC.
By:
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Name:
Title:
