EXHIBIT 10.8
FIRST SUPPLEMENTAL INDENTURE
AMONG GOTHIC ENERGY CORPORATION,
GOTHIC ENERGY OF TEXAS, INC.,
GOTHIC GAS CORPORATION
AND
THE BANK OF NEW YORK
THIS FIRST SUPPLEMENTAL INDENTURE (the "Supplemental Indenture") is
made as of the 23rd day of January 1998 by and between GOTHIC ENERGY
CORPORATION, an Oklahoma corporation (the "Company") and GOTHIC ENERGY OF TEXAS,
INC., an Oklahoma corporation, and GOTHIC GAS CORPORATION, an Oklahoma
corporation (the "Initial Guarantors") and THE BANK OF NEW YORK, a New York
banking corporation, as trustee (the "Trustee").
RECITALS:
WHEREAS, the Company, the Initial Guarantors and the Trustee have
entered into an indenture dated as of September 9, 1997 (the "Indenture"); (all
terms defined in the Indenture shall have the same meanings in this Supplemental
Indenture unless otherwise defined herein); and
WHEREAS, the Company is entering into a series of transactions,
including the acquisition by the Company of producing natural gas properties,
located in the Anadarko and Arkomo Basins of Oklahoma, from Amoco Production
Company, a subsidiary of Amoco Corporation (the "Amoco Acquisition,'); and
WHEREAS, the purpose of the amendment to the Indenture described in
this Supplemental Indenture is to permit the Company to incur indebtedness to
complete the Amoco Acquisition and to collateralize such Indebtedness; and
WHEREAS, Article IX of the Indenture provides a manner by which the
Indenture may be amended, with the consent of the Holders of at least two-thirds
in aggregate principal amount of the then outstanding Securities, by written act
of said Holders delivered to the Company and the Trustee; and
WHEREAS, the Holders of at least two-thirds in aggregate principal
amount of the outstanding Securities have delivered said consents to the Trustee
and the Company; and
WHEREAS, pursuant to and in accordance with Section 9.02 of the
Indenture, and with the consent of the Holders of at least two-thirds in
aggregate principal amount of the outstanding Securities, the Company, the
Initial Guarantors and the Trustee have agreed to enter into this Supplemental
Indenture;
NOW THEREFORE, each party hereto agrees as follows for the benefit of
each other party and for the equal and ratable benefit of the Holders of the
Company's 12 1/4% Series A and Series B Senior Notes due 2004:
1. Subject to Section 4 hereof, the following definition is added to
Section 1.01 of the Indenture:
"Amoco Acquisition" means the acquisition by the Company pursuant
to an agreement dated November 15, 1997 with Amoco Production Company
of natural gas producing properties located in the Anadarko and Arkoma
Basins of Oklahoma.
2. Subject to Section 4 hereof, the definition of "Permitted
Indebtedness" contained in Section 1.01 of the Indenture is hereby amended to
read in its entirety as follows;
"Permitted Indebtedness" means (i) Indebetedness of the Company
and its Subsidiaries outstanding as of the Issue Date plus
Indebtedness incurred to consummate the Amoco Acquisition (less Net
Cash Proceeds from an Equity Offering applied to permanently retire
indebtedness incurred to consummate the Amoco Acquisition); (ii)
indebtedness of the Company and its Subsidiaries that are, or will
become, guarantors under a Bank Credit Facility as the same may be
amended, refinanced or replaced, in a principal amount outstanding at
any time not to exceed a principal amount equal to $30.0 million, plus
related accrued interest and costs, less any Net Cash Proceeds applied
in accordance with Section 4.11(b) to repay or prepay such
Indebtedness that results in a permanent reduction in any revolving
credit or other commitment relating thereto or the maximum amount that
may be borrowed thereunder; provided, however, that Indebtedness
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outstanding which was incurred to consummate the Amoco Acquisition
shall reduce amounts available for incurrence under this subclause
(ii); (iii) other indebtedness of the Company and its Subsidiaries in
a principal amount not to exceed $10.0 million at any one time
outstanding plus accrued interest thereon; (iv) Non-Recourse
Indebtedness; (v) Indebtedness of the Company to any Wholly Owned
Subsidiary of the Company and Indebtedness of any Subsidiary of the
Company to the Company or another Wholly Owned Subsidiary of the
Company; (vi) Permitted Company Refinancing Indebtedness; (vii)
Permitted Subsidiary Refinancing Indebtedness; (viii) obligations
under hedging arrangements that the Company and its Subsidiaries enter
into in the ordinary course of business for the purpose of protecting
their production against fluctuations in oil and natural gas prices;
(ix) Indebtedness under the Securities; and (x) Indebtedness
of a Subsidiary pursuant to a Guarantee of the Securities pursuant to
Article X of this Indenture.
3. Subject to Section 4 hereof, the definition of "Permitted Liens"
contained in Section 1.01 of the Indenture is hereby amended to read in its
entirety as follows:
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"Permitted Liens" means (i) Liens outstanding as of the Issue
Date; (ii) Lien now or hereafter securing a Bank Credit Facility and
bank Indebtedness incurred to consummate the Amoco Acquisition; (iii)
Liens now or hereafter securing any interest rate hedging obligations
so long as the related Indebtedness (a) constitutes Senior
Indebtedness or (b) is, or is permitted to be under this Indenture,
secured by a Lien on the same property securing such interest rate
obligations; (iv) Liens now or hereafter securing any interest rate
hedging obligations so long as the related Indebtedness (a)
constitutes the Securities (or any Refinancing Indebtedness of the
Company in respect thereof) or (b) is, or is permitted to be under the
Indenture, secured by a Lien on the same property securing such
interest rate hedging obligations; (v) Liens securing Indebtedness,
the proceeds of which are used to refinance secured Indebtedness of
the Company or its Subsidiaries; provided, that such Liens extend to
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or cover only the property or assets currently securing the
Indebtedness being refinanced; (vi) Liens for taxes, assessments and
governmental charges not yet delinquent or being contested in good
faith and for which adequate reserves have been established to the
extent required by GAAP; (vii) mechanics', workmen's, materialmen's,
operators' or similar Liens arising in the ordinary course of
business; (viii) Liens in connection with workers' compensation,
unemployment insurance or other social security, old age pension or
public liability obligations; (ix) Liens, deposits or pledges to
secure the performance of bids, tenders, contracts (other than
contracts for the payment of money), leases, public or statutory
obligations, surety, stay, appeal indemnity, performance or other
similar bonds, or other similar obligations arising in the ordinary
course of business; (x) survey exceptions, encumbrances, easements or
reservations of, or rights of others for, rights of way, zoning or
other restrictions as to the use of real properties, and minor defects
in title which, in the case of any of the foregoing, were not incurred
or created to secure the payment of borrowed money or the deferred
purchase price of property or services, and in the aggregate do not
materially adversely affect the value of such properties or materially
impair use for the purposes of
which such properties are held by the Company or any Subsidiaries;
(xi) Liens on, or related to, properties to secure all or part of the
costs incurred in the ordinary course of business of exploration,
drilling, development or operation thereof, (xii) Liens on pipeline or
pipeline facilities which arise out of operation of law; (xiii)
judgment and attachment Liens not giving rise to an Event of Default
or Liens created by or existing from any litigation or legal
proceeding that are currently being contested in good faith by
appropriate proceedings and for which adequate reserves have been
made; (xiv) (a) Liens upon any property of any Person existing at the
time of acquisition thereof by the Company or a Subsidiary, (b) Liens
upon any property of a Person existing at the time such Person is
merged or consolidated with the Company or any Subsidiary or existing
at the time of the sale or transfer of any such property of such
Person to the Company or any Subsidiary, or (c) Liens upon any
property of a Person existing at the time such
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Person becomes a Subsidiary; provided, that in each case such Lien has
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not been created in contemplation of such sale, merger, consolidation,
transfer or acquisition; and provided that in each such case no such
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Lien shall extend to or cover any property of the Company or any
Subsidiary other than the property being acquired and improvements
thereon; (xv) Liens on deposits to secure public or statutory
obligations or in lieu of surety or appeal bonds entered into in the
ordinary course of business; (xvi) Liens in favor of collecting or
payor banks having a right of setoff, revocation, refund or chargeback
with respect to money or instruments of the Company or any Subsidiary
on deposit with or in possession of such bank; (xvii) purchase money
security interests granted in connection with the acquisition of
assets in the ordinary course of business and consistent with past
practices; provided, that (A) such Liens attach only to the property
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so acquired with the purchase money indebtedness secured thereby and
(B) such Liens secure only Indebtedness that is not in excess of 100%
of the purchase price of such assets; (xviii) Liens reserved in oil
and gas mineral leases for bonus or rental payments and for compliance
with the terms of such leases; (xix) Liens arising under partnership
agreements, oil and gas leases, farm-out agreements, division orders,
contracts for the sale, purchase, exchange, transportation or
processing (but not refining) of oil, gas or other hydrocarbons,
unitization and pooling declarations and agreements, development
agreements, operating agreements, area of mutual interest agreements,
and other similar agreements which are customary in the Oil and Gas
Business; (xx) Liens securing obligations under hedging arrangements
that the Company or any Subsidiary enters into in the ordinary course
of business for the purpose of protecting its production against
fluctuations in oil and natural gas prices; and (xxi) Liens to secure
Dollar-Denominated Production Payments and Volumetric Production
Payments.
4. Upon the execution and delivery of this Supplemental Indenture by
the Company, the Initial Guarantors and the Trustee, the Indenture shall be
supplemented in accordance herewith, and this Supplemental Indenture shall form
a part of the Indenture for all purposes, and every Holder of Securities
heretofore or hereafter authenticated and delivered under the Indenture shall he
bound thereby; provided, however, that Sections 1 through 3 hereof shall become
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operative upon the satisfaction (or waiver by the Company) of the conditions set
forth in the Consent Solicitation Statement, dated January 7, 1998, as
supplemented, that was provided to Holders of Securities in connection with the
Company's solicitation of consents by such Holders to the amendments set forth
herein. Upon the receipt by the Trustee of (i) an Officers' Certificate
certifying that such conditions have been satisfied, or waived by the Company,
and (ii) an Opinion of Counsel to the effect set forth in Section 9.06 of the
Indenture, the amendments set forth herein shall become operative.
5. Except as supplemented hereby, all provisions in the Indenture
shall remain in full force and effect. This Supplemental Indenture is an
indenture supplemental to and in implementation of the Indenture, and the
Indenture and the Supplemental Indenture shall
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henceforth be read and construed together. The Indenture as supplemented by this
Supplemental Indenture is in all respects confirmed and preserved.
6. If any provision of this Supplemental Indenture limits, qualifies
or conflicts with any provision of the Trust Indenture Act that is required
under such Act to be part of and govern any provision of this Supplemental
Indenture, the provisions of such Act shall control. If any provision of this
Supplemental Indenture modifies or excludes any provision of the Trust Indenture
Act that may be so modified or excluded, the provision of such Act shall be
deemed to apply to the Indenture as so modified or to be excluded by this
Supplemental Indenture, as the case may be.
7. In case any provision in this Supplemental Indenture 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.
8. Nothing in this Supplemental Indenture, the Indenture or the
Securities, express or implied, shall give to any Person, other than the parties
hereto and thereto and their successors hereunder and thereunder and the Holders
of Securities, any benefit of any legal or equitable right, remedy or claim
under the Indenture, this Supplemental Indenture or the Securities.
9. The recitals contained herein shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
In entering into this Supplemental Indenture, the Trustee shall be entitled to
the benefit of every provision of the Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee, whether or
not elsewhere herein so provided.
10. This Supplemental Indenture shall be governed by and construed in
accordance with the laws of the State of New York, without regard to the
conflicts of law principles thereof.
11. This Supplemental Indenture may be executed in counterparts, each
of which, when so executed, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first written above.
GOTHIC ENERGY CORPORATION
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: President
GUARANTORS
GOTHIC ENERGY OF TEXAS, INC.
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: President
GOTHIC GAS CORPORATION
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Van X. Xxxxx
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Name: Van X. Xxxxx
Title: Assistant Vice President
