Exhibit 4.2
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THE SECURITY REPRESENTED HEREBY WAS ORIGINALLY ISSUED AS OF DECEMBER 22,
2003, HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM
REGISTRATION THEREUNDER. THE SECURITY REPRESENTED HEREBY IS ALSO SUBJECT TO
THE CONDITIONS SPECIFIED IN THE NOTE PURCHASE AGREEMENT AMONG THE COMPANY
AND THE ORIGINAL HOLDER HEREOF AND CERTAIN INVESTORS, DATED AS OF DECEMBER
22, 2003 AND THE COMPANY RESERVES THE RIGHT TO REFUSE THE TRANSFER OF THIS
SECURITY UNTIL THE CONDITIONS THEREIN HAVE BEEN FULFILLED WITH RESPECT TO
SUCH TRANSFER. A COPY OF SUCH SECURITIES PURCHASE AGREEMENT MAY BE OBTAINED
BY THE HOLDER HEREOF AT THE COMPANY'S PRINCIPAL PLACE OF BUSINESS WITHOUT
CHARGE.
THIS INSTRUMENT AND THE OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATED TO
THE PRIOR PAYMENT IN FULL OF THE SUPERIOR DEBT (AS DEFINED HEREINAFTER).
JUNIOR SUBORDINATED
PROMISSORY NOTE
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December 22, 2003 $51,000,000
Quest Cherokee, LLC, a Delaware limited liability company (the "Company"),
hereby promises to pay to the order of Cherokee Energy Partners LLC, a Delaware
limited liability company, the principal amount of $51,000,000 together with
interest thereon calculated from the date hereof (the "Date of Issuance") in
accordance with the provisions of this Junior Subordinated Promissory Note (the
"Note").
This Note was issued pursuant to a Note Purchase Agreement, dated as of the
date hereof (such agreement to which the initial holder is a party, as amended
and modified from time to time, the "Purchase Agreement"), by and among the
Company and the initial holder of this Note. For purposes of this Note, "Junior
Notes" means this Note and all other notes issued on the date hereof or at any
time hereafter in substantially the same form whether issued pursuant to the
Purchase Agreement or otherwise (including any PIK Notes). The Purchase
Agreement contains terms governing the rights of the holder of this Note, and
all provisions of the Purchase Agreement are hereby incorporated herein by
reference.
1. Payment of Interest. Interest shall accrue at the rate of fifteen
percent (15%) per annum on the unpaid principal amount of this Note from time to
time outstanding. Interest shall be computed on the basis of a 365 or 366-day
year (as applicable) and the actual number of days elapsed, and shall be payable
on each Interest Payment Date (as defined in the Purchase Agreement); provided
that, except to the extent same is permitted to be paid in cash under the Senior
Revolving Credit Agreement (as defined in Section 6 hereof) on each Interest
Payment Date after the Senior Term Repayment Date (as defined in Section 6
hereof), the Company shall
pay interest in kind by either (i) issuing a PIK Note (as defined in Section 6
hereof) to the holder hereof in principal amount equal to the amount of the
interest due on such Interest Payment Date or (ii) deferring the interest due on
such Interest Payment Date and all interest so deferred pursuant to this clause
(ii) shall be added to and become a part of the principal of this Note as of the
Interest Payment Date upon which it was deferred, and shall thereafter earn
interest as provided herein. Except as provided in the last sentence of this
Section 1, in all events an amount of accrued and unpaid interest (including any
interest represented by a PIK Note or otherwise previously added to principal)
shall be paid by the Company in cash, on each Interest Payment Date occurring
after the fifth anniversary of the date hereof, equal to the least amount of
such accrued and unpaid interest such that the Note shall not have at any time
"significant original issue discount" within the meaning of section 163(i)(2) of
the Internal Revenue Code of 1986. Any accrued interest which for any reason has
not theretofore been paid shall be paid in full on the date on which the final
principal payment on this Note is made. Except for interest paid by the issuance
of a PIK Note or deferred and paid-in-kind in accordance with the terms hereof,
interest shall be paid only if the Senior Term Debt has been paid in full in
cash and such payment is permitted by the terms of the Senior Revolving Credit
Agreement and only to the extent therefor pursuant to Section 5.4 of the
Company's Amended and Restated Limited Liability Company Agreement.
2. Payment of Principal on Note.
(a) Maturity. The Company shall pay the principal amount outstanding
under this Note (including interest deferred and added to the principal amount
of this Note as provided in Section 1 above) together with all accrued and
unpaid interest on such principal amount, to the holder of this Note on the
Final Maturity Date (as defined in the Purchase Agreement as in effect on the
date hereof).
(b) Prepayments.
(i) Upon notice given as provided in subsection (ii) below, the
Company may at any time and from time to time prepay all or any proportion
of the outstanding principal amount of the Note, plus accrued interest on
the outstanding principal amount of the Note through the date of
prepayment; provided that (A) the Senior Term Debt has been paid in full in
cash, (B) such prepayment is permitted by the terms of the Senior Revolving
Credit Agreement and (C) such prepayment shall be made pro rata among the
holders of the Junior Notes on the basis of the outstanding principal
amount of the Junior Note held by each holder.
(ii) The Company shall send written notice of its election to
make a prepayment on the Junior Notes to the holder of this Note by
registered or certified mail, return receipt requested, at least three (3)
Business Days prior to the date of prepayment. Such notice shall specify
the date fixed for prepayment, the aggregate principal amount outstanding,
the aggregate amount of interest accrued on the outstanding principal
amount of this Note through the date of prepayment specified in the
Company's notice.
(c) Time of Payment. If any payment of principal, interest or premium
shall become due on a day which is not a Business Day (as defined below), such
payment shall be made on the next succeeding Business Day and such extension of
time shall in such case be
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included in computing interest in connection with such payment. The term
"Business Day" as used herein means any day other than Saturday or Sunday or
public holiday under the laws of the State of New York or other day on which
banking institutions are authorized or obligated to close in the City of New
York in the State of New York.
(d) Form of Payment. Unless otherwise indicated herein, any payment to
be made hereunder shall be made at the direction of the holder hereof by
cashier's or certified check to or upon the order of the holder or by wire
transfer of immediately available funds to an account designated by the holder.
3. Subordination: Restrictions on Payment.
Anything in this Note or the Purchase Agreement to the contrary
notwithstanding, the obligations of the Company in respect of the principal,
interest, fees and charges on this Note shall be subordinate and junior in right
of payment, to the extent and in the manner hereinafter set forth, to the prior
payment in full in cash of all Superior Debt. By its acceptance hereof, the
payee and each other present and future holder of this Note and beneficial owner
of any interest in this Note or any other Subordinated Debt (collectively,
including the payee, the "holders" of Subordinated Debt) irrevocably agree, for
the directly intended and enforceable benefit of each present and future holder
of Superior Debt, that the Subordinated Debt is hereby subordinated to the
Superior Debt on the following terms:
(a) In the event that the Company makes a general assignment for the
benefit of creditors; or an order, judgment or decree is entered adjudicating
the Company bankrupt or insolvent; or any order for relief with respect to the
Company is entered under the Federal Bankruptcy Code; or the Company petitions
or applies to any tribunal for the appointment of a custodian, trustee, receiver
or liquidator of the Company or of any substantial part of the assets of the
Company, or commences any proceeding relating to the Company under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction; or any such petition or
application is filed, or any such proceeding is commenced, against the Company
(collectively referred to as an "Insolvency Event"), or upon any acceleration of
Superior Debt, then:
(i) the holders of Superior Debt shall be entitled to receive
payment in full in cash of all principal, premium, interest, fees, charges
and other amounts then due on all Superior Debt (including interest, fees,
charges and other amounts accruing thereon after the commencement of any
such Insolvency Event at the rate provided in the documentation for such
Superior Debt (irrespective of whether such interest, fees, charges or
other amounts are allowed as a claim in such proceedings)) before the
holder of this Note is entitled to receive any payment of any kind or
character on account of principal, interest or other amounts due (or past
due) upon this Note, and the holders of Superior Debt shall be entitled to
receive for application in payment thereof all payments and distributions
of any kind or character, whether in cash, property or securities or by
set-off or otherwise, which may be payable or deliverable in any such
proceedings in respect of this Note; and
(ii) any payment or distribution of assets of the Company, of any
kind or character, whether in cash, property or securities, to which the
holder of this Note
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would be entitled except for the provisions of this Section 3(a) shall be
paid or delivered by the Company (or any receiver or trustee in such
proceedings) directly to the Senior Revolving Agent (or the Senior Term
Agent if the Senior Revolving Debt has been paid in full) for the benefit
of the holders of Superior Debt for application of such payment or
distribution among the holders of the Superior Debt according to the
priorities of such debt, until all Superior Debt (including interest,
fees, charges and other amounts accrued thereon after the date of
commencement of such proceedings at the rate provided in the documentation
for such Superior Debt (irrespective of whether such interest, fees,
charges or other amounts are allowed as a claim in such proceedings))
shall have been paid in full in cash.
(b) In any proceedings with respect to any Insolvency Event, or the
application of the assets of the Company to the payment or liquidation thereof,
or upon the dissolution or other winding up of the business of the Company or
upon the sale of all or substantially all of the assets of the Company, then,
and in any such event, (A) each holder of the Superior Debt shall be entitled to
receive full and indefeasible payment and satisfaction in cash of the Superior
Debt prior to the payment of all or any part of the Subordinated Debt by the
Company, other than a distribution of Reorganization Subordinated Securities if
each Senior Agent and the holder of this Note shall have entered into such
amendments to this Note as either Senior Agent may reasonably request to reflect
the continued subordination of the Reorganization Subordinated Securities to the
Superior Debt, and (B) any payment or distribution of any kind or character from
the Company of its assets, whether in cash, securities or other property, which
shall be payable or deliverable upon or with respect to any or all of the
Subordinated Debt, other than a distribution of Reorganization Subordinated
Securities if each Senior Agent and the holder of this Note shall have entered
into such amendments to this Note as either Senior Agent may reasonably request
to reflect the continued subordination of the Reorganization Subordinated
Securities to the Superior Debt, shall be paid or delivered directly to the
Senior Revolving Agent (or the Senior Term Agent if the Senior Revolving Debt
has been paid in full) for the benefit of the holders of the Superior Debt for
application to the Superior Debt in accordance with the priorities thereof, due
or not due, until such Superior Debt shall have first been fully and
indefeasibly paid in cash and satisfied and all financing arrangements
terminated. The holder of this Note irrevocably authorizes, empowers and directs
all receivers, trustees, liquidators, custodians, conservators and others having
authority in the premises to effect all such payments and distributions, and the
holder of this Note also irrevocably authorizes, empowers and directs the Senior
Revolving Agent (or the Senior Term Agent if the Senior Revolving Debt has been
paid in full in cash) to demand, xxx for, collect and receive every such payment
or distribution for the benefit of the Senior Lenders. Any amounts collected or
received by any Senior Agent pursuant to the authority granted hereby, shall be
paid or delivered directly to holders of the Superior Debt for application to
the Superior Debt in accordance with the priorities thereof, due or not due,
until such Superior Debt shall have first been fully and indefeasibly paid in
cash and satisfied and all financing arrangements terminated. The holder of this
Note agrees to execute and deliver to the Senior Revolving Agent (or the Senior
Term Agent if the Senior Revolving Debt has been paid in full in cash) or its
representative all such further instruments confirming the authorization
referred to in the foregoing clause and agrees not to initiate or prosecute or
encourage any other person to initiate or prosecute any claim, action or other
proceeding challenging the enforceability of the Superior Debt or any liens and
security interests securing the Superior Debt. The holder of this Note agrees to
execute, verify, deliver and file any proofs of claim in respect of the
Subordinated Debt
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requested by the Senior Revolving Agent (or the Senior Term Agent if the Senior
Revolving Debt has been paid in full in cash) in connection with any such
proceeding and hereby irrevocably authorizes, empowers and appoints the Senior
Revolving Agent (or the Senior Term Agent if the Senior Revolving Debt has been
paid in full in cash) its agent and attorney-in-fact to (i) execute, verify,
deliver and file such proofs of claim upon the failure of the holder of this
Note promptly to do so (and, in any event, prior to 30 days before the
expiration of the time to file any such proof) and (ii) vote such claim in any
such proceeding upon the failure of the holder of this Note to do so prior to 15
days before the expiration of the time to vote any such claim; provided that
neither Senior Agent shall have any obligation to execute, verify, deliver, file
and/or vote any such proof of claim. In the event that a Senior Agent votes any
claim in accordance with the authority granted hereby, no holder shall be
entitled to change or withdraw such vote. The Superior Debt shall continue to be
treated as Superior Debt and the provisions of this Note shall continue to cover
the relative rights and priorities of the Senior Lenders, on the one hand, and
the holder of this Note, on the other hand, even if all or part of the Superior
Debt or the security interests securing the Superior Debt are subordinated, set
aside, avoided or disallowed in connection with any such proceeding and this
Note shall be reinstated if at any time any payment of any of the Superior Debt
is rescinded or must otherwise be returned by any holder of Superior Debt or any
representative of such holder.
(c) Except for payments of interest in kind, and the issuance of
Reorganization Subordinated Securities expressly permitted herein, no holder of
the Subordinated Debt will, except as otherwise agreed to by each Senior Agent
and the Required Lenders (as defined in Section 6 hereof) or to the extent
permitted under the Senior Revolving Credit Agreement after the payment in full
in cash of the Senior Term Debt, ask, demand, xxx for, take or receive from the
Company, by set off or in any other manner, the whole or any part of the
Subordinated Debt (whether such amounts represent principal or interest, or
obligations which are due or not due, including costs, fees and expenses with
respect to the Junior Notes, direct or indirect, absolute or contingent),
including, without limitation, the taking of any negotiable instruments
evidencing such Subordinated Debt nor any security for any Subordinated Debt,
unless and until all Superior Debt, whether now existing or hereafter arising
directly between the Company and any holder of the Superior Debt, or acquired
outright, conditionally or as collateral security from another by any holder the
Superior Debt, shall have been fully and indefeasibly paid in full in cash and
satisfied and all financing arrangements and commitments between the Company and
all holders of the Superior Debt have been terminated.
(d) Any amendment or modification of the terms of Section 3 of this
Note shall not be effective against any Person who was a holder of Superior Debt
prior to or at the time of such amendment or modification unless such holder of
Superior Debt so consents in writing.
(e) The holders of Superior Debt may, at any time, in their
discretion, renew, amend, extend, increase, restate, refinance or otherwise
modify the terms and provisions of the Superior Debt so held or exercise or
release any of their rights under the Superior Debt including, without
limitation, the waiver of defaults thereunder and the amendment of any of the
terms or provisions thereof (or any notice evidencing or creating the same), or
the release of collateral securing the Superior Debt, all without notice to or
assent from the holder of this Note. No compromise, alteration, amendment,
renewal, restatement, refinancing or other change of, or waiver, consent or
other action in respect of any liability or obligation under or in respect of,
any
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terms, covenants or conditions of the Superior Debt (or any instrument
evidencing or creating the same), whether or not such release is in accordance
with the provisions of the Superior Debt (or any instrument evidencing or
creating the same), shall in any way alter or affect the enforceability of the
subordination provisions of this Note against the holder hereof.
(f) If, notwithstanding the provisions of Section 3 of this Note, any
payment or distribution of any kind or character (whether in cash, securities or
other property) or any security shall be received by the holder of this Note in
contravention of this Section 3 and before all the Superior Debt shall have been
paid in full in cash, such payment, distribution or security shall be held in
trust for the benefit of, and shall be immediately paid over or delivered or
transferred to the Senior Revolving Agent (or the Senior Term Agent if the
Senior Revolving Debt has been paid in full) for the benefit of the holders of
Superior Debt or their duly appointed agents for application of such payment,
distribution or security among the holders of each class of Superior Debt
according to the priorities of such Superior Debt. Any such payments received by
the holder of this Note and delivered to the Senior Revolving Agent (or the
Senior Term Agent if the Senior Revolving Debt has been paid in full) for the
benefit of the holders of the Superior Debt shall be deemed not to be a payment
on this Note for any reason whatsoever and the indebtedness under this Note
shall remain as if such erroneous payment had never been paid by the Company or
received by the holder of this Note. In the event of the failure of any holder
of this Note to endorse or assign any such payment, distribution or security,
each Senior Agent is hereby irrevocably authorized to endorse or assign the
same.
(g) No present or future holder of Superior Debt shall be prejudiced
in its right to enforce the provisions of Section 3 of this Note by any act or
failure to act on the part of the Company or such holder or any other holder of
Superior Debt.
(h) The holder of this Note shall not take or continue any action, or
exercise or continue to exercise any rights, remedies or powers under the terms
of this Note, or exercise or continue to exercise any other right or remedy at
law or equity that such holder might otherwise possess, to collect any amount
due and payable in respect of this Note, including, without limitation, the
acceleration of this Note, the commencement of any foreclosure on any Lien, the
filing of any petition in bankruptcy or the taking advantage of any other
insolvency law of any jurisdiction.
(i) Subject to the indefeasible payment in full in cash of all
Superior Debt and the termination of all lending commitments under the Senior
Revolving Credit Agreement, the holder of this Note shall be subrogated to the
rights of the Senior Agents and Senior Lenders to receive payments and
distributions with respect to the Superior Debt until this Note is paid in full.
The holder of this Note agrees that in the event that all or any part of a
payment made with respect to the Superior Debt is recovered from the holders of
the Superior Debt in a proceeding with respect to an Insolvency Event or
otherwise, any payment or distribution received by the holder of this Note with
respect to this Note at any time after the date of the payment that is so
recovered, whether pursuant to the right of subrogation provided for in this
Note or otherwise, shall be deemed to have been received by the holder of this
Note in trust as property of the holders of the Superior Debt and the holder of
this Note shall forthwith deliver the same to the Senior Revolving Agent (or the
Senior Term Agent if the Senior Revolving Debt has been paid in full) for the
benefit of the Senior Revolving Lenders (or the Senior Term Lenders if the
Senior Revolving Debt has been paid in full) for application to the Senior
Revolving Debt (or the Senior
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Term Debt if the Senior Revolving Debt has been paid in full) until the Superior
Debt is paid in full. A payment or distribution made pursuant to this Section
3(i) to any Senior Agent or any Senior Lender which otherwise would have been
paid to or retained by the holder of this Note is not, as between the Company
and the holder of this Note, a payment by the Company to or on account of the
Superior Debt.
(j) The provisions of this Section 3 are solely for the purpose of
defining the relative rights of the holders of Superior Debt, on the one hand,
and the holder of this Note on the other, against the Company and its assets,
and nothing herein is intended to or shall impair, as between the Company and
the holder of this Note, the obligations of this Company which are absolute and
unconditional, to pay to the holder of this Note the principal and interest on
this Note as and when they become due and payable in accordance with their
terms, or is intended to or will affect the relative rights of the holder of
this Note and creditors of the Company other than the holders of the Superior
Debt, nor, except as provided in this Section 3, will anything herein or therein
prevent the holder of this Note from exercising all remedies otherwise permitted
by applicable law upon default under this Note subject to the rights, if any,
under this Section 3 of the holders of Superior Debt in respect of cash,
property or securities of the Company received upon the exercise of any such
remedy and subject to this Section 3.
(k) Each holder of the Subordinated Debt has purchased or acquired the
Subordinated Debt held by it with the express understanding that:
(i) the Subordinated Debt constitutes the liability solely of the
Company;
(ii) no member of the Company has guaranteed or is otherwise
liable for any Subordinated Debt;
(iii) the Subordinated Debt is not secured by any mortgage, lien,
pledge, charge, financing statement, security interest, hypothecation or
other security device of any type (a "Lien"), nor is such Subordinated Debt
supported directly or indirectly by any direct or indirect guaranty of any
Person; and
(iv) such holder of Subordinated Debt will never ask, demand,
accept, receive or retain any guarantee of any Subordinated Debt, or any
collateral security for the payment of any Subordinated Debt, or any other
form of payment assurance as to any Subordinated Debt, from any member or
Subsidiary of the Company, and will not initiate or prosecute, or encourage
any other Person to initiate or prosecute any claim or other proceeding.
(l) Except for the payment of interest in kind in accordance with the
terms of this Note, if by the terms of this Note any payment becomes due and
payable on account of the principal of or interest on this Note at any time (i)
prior to the Senior Term Repayment Date or (ii) after the Senior Term Repayment
Date, and with respect to this clause (ii) payment hereon is not permitted under
the Senior Revolving Credit Agreement, then the holder of this Note hereby
agrees that, notwithstanding the terms of this Note, the date on which such
payment would otherwise be due shall automatically be deferred, extended and
postponed until the date (the "Extension Date") on which all Senior Term Debt
has been paid in full and such payment is
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permitted pursuant to the terms of said Senior Revolving Credit Agreement, as
fully as if by the terms of this Note such payment was not due until the
Extension Date. The Company shall not be in any respect in default under this
Note by reason of any such deferral, extension and postponement to the Extension
Date, and such deferral, extension and postponement shall not otherwise subject
the Company to any claim of default or any enforcement remedy. The holder of
this Note, in its capacity as a creditor, and by its acceptance of this Note,
covenants and agrees that it will not, and will not encourage any other
individual or entity to, at any time, contest the validity, perfection, priority
or enforceability of any Superior Debt and the promissory notes issued pursuant
thereto or any guarantees thereof or any of the other Superior Loan Documents
(as deferred in Section 6 hereof) (or the liens and security interests granted
to the Collateral Agent (as defined in Section 6 hereof) pursuant thereto.
(m) Any and all payments and distributions on account of this Note
that are received by any Senior Agent or any Senior Lender as a result of this
Section 3 shall be distributed to the holders of the Superior Debt according to
the priorities of such Superior Debt.
4. Transfer of Note. This Note may be transferred subject to the
restrictions set forth in the Purchase Agreement. Upon any such transfer, the
holder shall send written notice to the Company specifying the new holder's name
and address. The term "Note" as used herein includes this Note and any notes or
other evidences of indebtedness issued in exchange for or in respect of this
Note or any portion hereof.
5. Events of Default.
(a) Definition. For purposes of this Note, an Event of Default shall
be deemed to have occurred if:
(i) the Company fails to pay (A) when due, the full amount of any
principal payment on any Junior Note or (B) within five days of the date
when due, the full amount of any interest then accrued on any Junior Note;
or
(ii) the Company or any subsidiary makes an assignment for the
benefit of creditors or admits in writing its inability to pay its debts
generally as they become due; or an order, judgment or decree is entered
adjudicating the Company or any Subsidiary bankrupt or insolvent; or any
order for relief with respect to the company or any Subsidiary is entered
under the Federal Bankruptcy Code; or the Company or any Subsidiary
petitions or applies to any tribunal for the appointment of a custodian,
trustee, receiver or liquidator of the Company or any Subsidiary, or of any
substantial part of the assets of the Company or any Subsidiary, or
commences any proceeding (other than a proceeding for the voluntary
liquidation and dissolution of any Subsidiary) relating to the Company or
any Subsidiary under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation law of any
jurisdiction; or any such petition or application is filed, or any such
proceeding is commenced, against the Company or any Subsidiary and either
(A) the Company or any such Subsidiary by any act indicates its approval
thereof, consent thereto or acquiescence therein or (B) such petition,
application or proceeding is not dismissed within 60 days.
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(b) Consequences of Events of Default. Subject to the provisions of
Section 3 hereof, if an Event of Default has occurred and is continuing, the
holder or holders of the Junior Notes representing a majority of the aggregate
principal amount of the Junior Notes then outstanding may declare all or any
portion of the outstanding principal amount of the Junior Notes due and payable
and demand immediate payment of all or any portion of the outstanding principal
amount of the Junior Notes owned by such holder or holders. The Company shall
give prompt written notice of any such demand to the other holders of the Junior
Notes, each of which may demand immediate payment of all or any portion of such
holder's Note.
6. Definitions. For purposes of this Note, the following capitalized terms
have the following meaning.
"Bank One" means Bank One, NA, a national banking association, with its
main office in Chicago, Illinois, in its individual capacity, and its
successors.
"Collateral Agent" has the meaning assigned to such term in the Superior
Loan Documents.
"paid in full", "paid in full in cash", "payment in full" or similar
phrases mean with respect to the Superior Debt, the final and indefeasible
payment in full in cash of such Superior Debt and the termination of all
commitments of the Senior Lenders (as applicable) pursuant to the Senior
Revolving Credit Agreement and Senior Term Credit Agreement, as applicable.
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"PIK Note" means a junior subordinated promissory note of the Company that
is substantially identical to this Note except for the stated principal amount
thereof.
"Refinancing Lender" means any Person which provides refinancing to the
Company of all or a portion of the Superior Debt outstanding prior to such
refinancing.
"Reorganization Subordinated Securities" means (a) any equity securities
issued in substitution of all or any portion of the Subordinated Debt that are
subordinated in right of payment to the Superior Debt (or any notes or other
securities issued in substitution of all or any portion of the Superior Debt),
and (b) any notes or other debt securities issued in substitution of all or any
portion of the Subordinated Debt that are subordinated to the Superior Debt (or
any notes or other securities issued in substitution of all or any portion of
the Superior Debt) to the same extent that the Subordinated Debt is subordinated
to the Superior Debt pursuant to the terms of this Note.
"Required Lenders" means, collectively, the Senior Revolving Required
Lenders and the Senior Term Required Lenders; provided, that, (i) if the Senior
Revolving Debt has been paid in full, "Required Lenders" means the Senior Term
Required Lenders, and (ii) if the Senior Term Debt has been paid in full,
"Required Lenders" means the Senior Revolving Required Lenders.
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"Senior Agents" means, collectively, the Senior Revolving Agent and the
Senior Term Agent, and each individually, a "Senior Agent".
"Senior Lenders" means, collectively, the Senior Revolving Lenders, the
Senior Term Lenders and any Refinancing Lender.
"Senior Revolving Agent" means Bank One in its capacity as contractual
representative of the Senior Revolving Lenders pursuant to the Senior Revolving
Credit Agreement and not in its individual capacity as a Senior Revolving
Lender, and any successor administrative agent appointed pursuant to the Senior
Revolving Credit Agreement (including any Refinancing Lender or successor or
replacement administrative agent under any successor or new credit agreement
entered into in connection with the refinancing, replacement or substitution in
whole or in part of the Senior Revolving Debt).
"Senior Revolving Credit Agreement" means that certain Credit Agreement by
and among the Company, the lenders from time to time a party thereto (the
"Senior Revolving Lenders"), and the Senior Revolving Agent as amended, modified
or supplemented from time to time and any replacement, successor or new credit
agreement entered into in connection with the refinancing thereof.
"Senior Revolving Debt" means and includes (a) all indebtedness for loans
made or letters of credit issued or other credit extended under the Senior
Revolving Credit Agreement, (b) all other Obligations under and as defined in
the Senior Revolving Credit Agreement, including, without limitation,
liabilities, obligations, expenses and fees under any Hedge Agreements (as
defined in the Senior Revolving Credit Agreement) between or among the Company
and any Senior Revolving Lender or any affiliate thereof, together with interest
thereon, and (c) all indebtedness of the Company, or any of their Subsidiaries
arising in connection with any refunding or refinancing thereof (in which event
the terms "Senior Revolving Lenders" and "Senior Revolving Agent" shall refer to
the Senior Revolving Lenders and Senior Revolving Agent under such
refunding/refinancing facilities), in each instance together with all interest,
fees, costs, taxes, expense reimbursements, indemnification and other like
amounts arising under the Senior Revolving Credit Agreement and any other
instrument evidencing or agreement governing any such indebtedness, including
guaranties and all such amounts that become payable (or that would have become
payable if enforceable or allowable in such case or proceeding) on the terms
specified in such instrument or agreement after the commencement of any
bankruptcy, reorganization, receivership, insolvency, liquidation or dissolution
proceeding, whether or not the claim for such amount is enforceable, allowable
or allowed as a claim in such proceeding and even if such claim is not
enforceable or allowed therein.
"Senior Revolving Required Lenders" means Required Banks as defined in the
Senior Revolving Credit Agreement.
"Senior Term Agent" means Bank One in its capacity as contractual
representative of the Senior Term Lenders pursuant to the Senior Term Credit
Agreement and not in its individual capacity as a Senior Term Lender, and any
successor administrative agent appointed pursuant to the Senior Term Credit
Agreement (including any Refinancing Lender or successor or
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replacement administrative agent under any successor or new credit agreement
entered into in connection with the refinancing, replacement or substitution in
whole or in part of the Senior Term Debt).
"Senior Term Credit Agreement" means that certain Senior Term Second Lien
Secured Credit Agreement by and among the Company, the lenders from time to time
a party thereto (the
"Senior Term Lenders"), and the Senior Term Agent as amended, modified or
supplemented from time to time (to the extent allowed herein) and any
replacement, successor or new credit agreement entered into in connection with
the refinancing thereof.
"Senior Term Debt" means (i) indebtedness under the Senior Term Credit
Agreement and the promissory notes issued pursuant thereto, including, without
limitation, principal, premium, interest and other liabilities payable from time
to time and similar obligations, interest accruing before and after any
Insolvency Event at the rate provided in the documentation with respect thereto
(irrespective of whether such principal, premium, interest or other liabilities
are allowed as a claim in any such proceeding), premiums, penalties, fees,
indemnities or expenses, and regardless of whether direct or indirect, now
existing or hereafter arising, absolute or contingent, secured or unsecured, or
long or short term, (ii) obligations arising under guarantees executed by the
Company or any of its members or Subsidiaries of items described in (i) above,
and (iii) renewals, extensions, refundings, refinancings, deferrals,
restructurings, amendments and modifications of the items described in (i)
and/or (ii) above.
"Senior Term Repayment Date" means the date that all of the Senior Term
Debt is paid in full in cash.
"Senior Term Required Lenders" means Required Lenders as defined in the
Senior Term Credit Agreement.
"Subordinated Debt" means (i) indebtedness under the Junior Notes,
including, without limitation, principal, premium, interest and other
liabilities payable from time to time and similar obligations, premiums,
penalties, fees, indemnities or expenses, and regardless of whether direct or
indirect, now existing or hereafter arising, absolute or contingent, secured or
unsecured, or long or short term, (ii) obligations arising under guarantees
executed by the Company or any of its Subsidiaries of items described in (i)
above, and (iii) renewals, extensions, refundings, refinancings, deferrals,
restructurings, amendments and modifications of the items described in (i)
and/or (ii) above.
"Subsidiary" means, with respect to any Person, any corporation, limited
liability company, partnership, association or other business entity of which
(i) if a corporation, a majority of the total voting power of shares of 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 that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, or (ii) if a limited
liability company, partnership, association or other business entity, a majority
of the partnership or other similar ownership interest thereof is at the time
owned or controlled, directly or indirectly, by any Person or one or more
Subsidiaries of that Person or a combination thereof. For purposes hereof,
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a Person or Persons shall be deemed to have a majority ownership interest in a
limited liability company, partnership, association or other business entity if
such Person or Persons shall be allocated a majority of limited liability
company, partnership, association or other business entity gains or losses or
shall be or control any managing director or general partner of such limited
liability company, partnership, association or other business entity.
"Superior Debt" means (i) all Senior Revolving Debt; and (ii) all Senior
Term Debt.
"Superior Loan Documents" means, collectively, the "Loan Papers" as defined
in the Senior Revolving Credit Agreement and the "Loan Documents" as defined in
the Senior Term Credit Agreement.
7. Amendment and Waiver. Except as otherwise expressly provided herein, the
provisions of the Note may be amended and the Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if the Company has obtained the written consent of the holders of the
Junior Notes then outstanding and each Senior Agent and the Required Lenders
with respect to any Superior Debt then outstanding.
8. Cancellation. After all principal and accrued interest at any time owed
on this Note has been paid in full, this Note shall be surrendered to the
Company for cancellation and shall not be reissued.
9. Remedies Cumulative. No remedy herein conferred upon the holder of this
Note is intended to be exclusive of any other remedy, and each and every such
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.
10. Remedies not Waived. No course of dealing between the Company and the
holder of this Note or any delay on the part of the holder hereof in exercising
any rights hereunder shall operate as a waiver of any right of the holder of
this Note.
11. Covenants Bind Successors and Assigns. All the covenants, stipulations,
promises and agreements in this Note contained by or on behalf of the Company
shall bind its successors and assigns, whether so expressed or not.
12. Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of New York.
13. Heading. The headings of the sections and subsections of this Note are
inserted for convenience only and do not constitute a part of this Note.
14. Third Party Beneficiary. The Company and the holder of this Note
acknowledge and agree that the Senior Agents and the Senior Lenders and each of
their successors and assigns are third party beneficiaries of the provisions of
Section 3 of this Note, and the provisions of Section 3 of this Note shall inure
to the benefit of and be enforceable by the Senior Agent and the Senior Lenders
and their respective successors and assigns.
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15. Acceptance and Acknowledgment. By accepting this Note and advancing the
proceeds of the Subordinated Debt evidenced by this Note, the holder hereof
hereby agrees to, acknowledges and accepts, each of the terms and provisions of
this Note.
[Remainder Of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Company has executed and delivered this Note on the
Date of Issuance.
QUEST CHEROKEE, LLC
By: /s/ Xxxxx Xxxx
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Name: Xxxxx X. Xxxx
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Title:Manager
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