---------------
TRUST INDENTURE
dated as of August 13, 2001
among
KERN RIVER FUNDING CORPORATION,
as Issuer,
KERN RIVER GAS TRANSMISSION COMPANY,
as Guarantor,
and
THE CHASE MANHATTAN BANK
as Trustee
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Including
$510,000,000 6.676% Senior Notes due 2016
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TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION............................................1
SECTION 1.1. Definitions...........................................1
SECTION 1.2. Compliance Certificates and Opinions.................20
SECTION 1.3. Form of Documents Delivered to Trustee...............21
SECTION 1.4. Acts of Holders; Record Dates........................21
SECTION 1.5. Notices, Etc., to Trustee, Company and Partnership...23
SECTION 1.6. Notice to Holders; Waiver............................24
SECTION 1.7. Effect of Headings and Table of Contents.............24
SECTION 1.8. Successors and Assigns...............................24
SECTION 1.9. Separability Clause..................................24
SECTION 1.10. Benefits of Indenture................................24
SECTION 1.11. Governing Law........................................24
SECTION 1.12. Legal Holidays.......................................24
SECTION 1.13. Counterparts.........................................25
SECTION 1.14. Agency...............................................25
ARTICLE 2. THE SECURITIES........................................25
SECTION 2.1. Forms Generally......................................25
SECTION 2.2. Legends on Restricted Securities.....................27
SECTION 2.3. Amount Unlimited; Issuable in Series.................27
SECTION 2.4. Denominations........................................30
SECTION 2.5. Execution, Authentication, Delivery and Dating.......30
SECTION 2.6. Temporary Securities.................................31
SECTION 2.7. Registration, Registration of Transfer and Exchange..32
SECTION 2.8. Mutilated, Destroyed, Lost and Stolen Securities.....38
SECTION 2.9. Payments; Interest Rights Preserved..................39
SECTION 2.10. Persons Deemed Owners................................40
SECTION 2.11. Cancellation.........................................40
SECTION 2.12. Computation of Interest..............................41
SECTION 2.13. Certification Forms..................................41
SECTION 2.14. CUSIP Numbers........................................41
ARTICLE 3. SATISFACTION AND DISCHARGE............................41
SECTION 3.1. Satisfaction and Discharge of Indenture..............41
SECTION 3.2. Application of Trust Money...........................43
ARTICLE 4. REMEDIES..............................................43
SECTION 4.1. Events of Default....................................43
SECTION 4.2. Acceleration of Maturity; Rescission and Annulment...45
SECTION 4.3. Collection of Indebtedness and Suits for Enforcement
by Trustee.........................................46
SECTION 4.4. Trustee May File Proofs of Claim.....................47
SECTION 4.5. Trustee May Enforce Claims Without Possession of
Securities.........................................48
SECTION 4.6. Application of Money Collected.......................48
SECTION 4.7. Limitation on Suits..................................48
SECTION 4.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest...............................49
SECTION 4.9. Restoration of Rights and Remedies...................49
SECTION 4.10. Rights and Remedies Cumulative.......................49
SECTION 4.11. Delay or Omission Not Waiver.........................49
SECTION 4.12. Control by Holders...................................50
SECTION 4.13. Waiver of Past Defaults..............................50
SECTION 4.14. Undertaking for Costs................................50
SECTION 4.15. Waiver of Usury, Stay or Extension Laws..............51
SECTION 4.16. Securities Held by Certain Persons Not to Share in
Distribution.......................................51
SECTION 4.17. The Collateral Agency Agreement......................51
ARTICLE 5. THE TRUSTEE...........................................51
SECTION 5.1. Certain Duties and Responsibilities..................51
SECTION 5.2. Notice of Defaults...................................52
SECTION 5.3. Certain Rights of Trustee............................53
SECTION 5.4. Not Responsible for Recitals or Issuance of
Securities.........................................53
SECTION 5.5. May Hold Securities..................................54
SECTION 5.6. Money Held in Trust..................................54
SECTION 5.7. Compensation and Reimbursement.......................54
SECTION 5.8. Corporate Trustee Required; Eligibility..............55
SECTION 5.9. Resignation and Removal; Appointment of Successor....56
SECTION 5.10. Acceptance of Appointment by Successor...............57
SECTION 5.11. Merger, Conversion, Consolidation or Succession to
Business...........................................58
SECTION 5.12. Appointment of Paying Agent and Authenticating Agent.58
SECTION 5.13. Rights and Obligations of Trustee as Representative
of the Holders under the Security Agreements.......60
Page 2
ARTICLE 6. HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY.....61
SECTION 6.1. Company to Furnish Trustee Names and Addresses of
Holders...........................................61
SECTION 6.2. Preservation of Information; Communications to
Holders...........................................61
ARTICLE 7. SUPPLEMENTAL INDENTURES...............................62
SECTION 7.1. Supplemental Indentures Without Consent of Holders...62
SECTION 7.2. Supplemental Indentures With Consent of Holders......63
SECTION 7.3. Execution of Supplemental Indentures.................64
SECTION 7.4. Effect of Supplemental Indentures....................64
SECTION 7.5. Reference in Securities to Supplemental Indentures...65
ARTICLE 8. COVENANTS.............................................65
SECTION 8.1. Financial Statements, Etc............................65
SECTION 8.2. Payment of Principal, Premium and Interest...........67
SECTION 8.3. Existence, Etc.......................................67
SECTION 8.4. Money for Securities Payments to be Held in Trust....68
SECTION 8.5. Insurance............................................69
SECTION 8.6. Prohibition of Fundamental Changes...................70
SECTION 8.7. Ownership of the Company; No Other Subsidiaries......70
SECTION 8.8. Limitation on Liens..................................70
SECTION 8.9. Indebtedness.........................................72
SECTION 8.10. Investments..........................................73
SECTION 8.11. Distributions........................................73
SECTION 8.12. Affiliate Subordinated Debt..........................73
SECTION 8.13. Lines of Business; Single-Purpose Entity.............73
SECTION 8.14. Transactions with Affiliates and Related Parties.....74
SECTION 8.15. Modifications of Certain Documents...................74
SECTION 8.16. Mandatory Obligor Actions............................74
SECTION 8.17. Rule 144A Information................................74
SECTION 8.18. Maintenance of Office or Agency......................75
SECTION 8.19. Use of Proceeds......................................75
SECTION 8.20. Expansion............................................75
SECTION 8.21. Compliance With Laws.................................76
SECTION 8.22. Property.............................................76
SECTION 8.23. FERC Filings.........................................76
SECTION 8.24. Transportation Service Agreement.....................77
SECTION 8.25. Collateral Agency Agreement..........................77
SECTION 8.26. Transfers............................................77
SECTION 8.27. Amendment to Partnership Security Agreement..........77
SECTION 8.28. Debt Service Notices to Collateral Agent.............77
ARTICLE 9. REDEMPTION OF SECURITIES..............................77
SECTION 9.1. Applicability of Article.............................77
SECTION 9.2. Election to Redeem; Notice to Trustee................77
SECTION 9.3. Selection by Trustee of Securities to Be Redeemed....78
SECTION 9.4. Notice of Redemption.................................78
SECTION 9.5. Deposit of Redemption Price..........................79
SECTION 9.6. Securities Payable on Redemption Date................79
SECTION 9.7. Securities Redeemed in Part..........................80
SECTION 9.8. Mandatory Redemption Upon a Casualty Event...........80
SECTION 9.9. Redemption at Company's Option.......................80
ARTICLE 10. SINKING FUNDS.........................................81
SECTION 10.1. Applicability of Article.............................81
SECTION 10.2. Satisfaction of Sinking Fund Payments with
Securities.........................................81
SECTION 10.3. Redemption of Securities for Sinking Fund............81
ARTICLE 11. DEFEASANCE AND COVENANT DEFEASANCE....................82
SECTION 11.1. Company's Option to Effect Defeasance or Covenant
Defeasance.........................................82
SECTION 11.2. Defeasance and Discharge.............................82
Page 3
SECTION 11.3. Covenant Defeasance..................................82
SECTION 11.4. Conditions to Defeasance or Covenant Defeasance......83
SECTION 11.5. Deposited Money and U.S. Government Obligations to
Be Held in Trust; Miscellaneous Provisions.........85
SECTION 11.6. Reinstatement........................................85
ARTICLE 12. PARTNERSHIP GUARANTEE.................................85
SECTION 12.1. Obligations Guaranteed...............................85
SECTION 12.2. Obligations Unconditional............................86
SECTION 12.3. No Waiver or Set-off.................................86
SECTION 12.4. Waiver of Notice; Expenses...........................87
SECTION 12.5. Benefit and Enforcement..............................87
SECTION 12.6. Survival of Partnership Guarantee Obligation; Waiver
of Subrogation.....................................87
SECTION 12.7. Pledge of Partnership Collateral.....................87
ARTICLE 13. LIMITATION OF LIABILITY...............................88
SECTION 13.1. Company..............................................88
SECTION 13.2. Partnership..........................................88
EXHIBITS
EXHIBIT A FORM OF NOTE
EXHIBIT B FORM OF TRANSFER CERTIFICATE FOR EXCHANGE OR TRANSFER FROM
RESTRICTED GLOBAL SECURITY TO REGULATION S GLOBAL SECURITY
EXHIBIT C FORM OF TRANSFER CERTIFICATE FOR TRANSFER OR EXCHANGE FROM
REGULATION S GLOBAL SECURITY TO RESTRICTED GLOBAL SECURITY
EXHIBIT D FORM OF TRANSFER CERTIFICATE FOR TRANSFER OR EXCHANGE OF
RESTRICTED SECURITY
EXHIBIT E FORM OF INSTITUTIONAL ACCREDITED INVESTOR TRANSFEREE
COMPLIANCE LETTER
This TRUST INDENTURE, dated as of August 13, 2001, among KERN
RIVER FUNDING CORPORATION, a corporation duly organized and validly existing
under the laws of the State of Delaware, as issuer (the "Company"), having its
principal office at Tulsa, Oklahoma, Kern River Gas Transmission Company, a
general partnership duly organized and existing under the laws of the State of
Texas, as guarantor (the "Partnership"), having its principal office at Salt
Lake City, Utah, and The Chase Manhattan Bank, a New York corporation, as
trustee (the "Trustee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Company has duly authorized the execution and
delivery of this Indenture to provide for the issuance in its individual
capacity and as agent for the Partnership from time to time of the Company's
debentures, notes or other evidences of indebtedness in one or more series as in
this Indenture provided herein (the "Securities"); and
WHEREAS, the Company wishes to lend all of the proceeds of the
sale of the Securities to the Partnership; and
WHEREAS, the Partnership wishes to provide its guarantee to
secure the payment of the principal of, premium on, if any, and interest on, all
Page 4
the Securities authenticated and delivered hereunder and issued by the Company
and the performance of the covenants therein and herein contained; and
WHEREAS, all things necessary to make this Indenture a valid
agreement of the Company and the Partnership, in accordance with its terms, have
been done;
NOW, THEREFORE, for and in consideration of the premises and
the purchase of the Securities by the Holders thereof, it is mutually covenanted
and agreed, for the equal and proportionate benefit of all Holders of the
Securities or of series thereof, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONSOF GENERAL APPLICATION
SECTION 1.1.......Definitions. For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the
singular;
(2) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with regulatory accounting principles
(whether or not such is indicated herein), and, except as otherwise
herein expressly provided, the term "required accounting practices"
with respect to any computation required or permitted hereunder means
such accounting practices as are required by the Company and the
Partnership, at the date of such computation;
(3) unless otherwise specifically set forth herein, all calculations or
determinations of a Person shall be performed or made in accordance
with RAP;
(4) unless the context otherwise requires, any reference to an "Article"
or a "Section" refers to an Article or a Section, as the case may be,
of this Indenture;
(5) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(6) unless the context clearly intends to the contrary, pronouns having a
masculine or feminine gender shall be deemed to include the other; and
(7) unless otherwise expressly specified, any agreement, contract or
document defined or referred to herein shall mean such agreement,
contract or document as in effect as of the date hereof, as the same
may thereafter be amended, supplemented or otherwise modified from time
to time in accordance with the terms of this Indenture and the other
Project Agreements (as hereinafter defined) and shall include any
agreement, contract or document in substitution or replacement of any
of the foregoing entered into in accordance with the terms of this
Indenture and the other Project Agreements.
"2002 Expansion" means the expansion for which the Partnership
filed an application with the FERC in Docket No. CP01-31-000 on November 15,
2000.
"Acceptable Letter of Credit" means an irrevocable standby
letter of credit provided on behalf of an LTFT Shipper for the benefit of the
Partnership with a stated amount equal, at any time, to one year's reservation
charges due under the applicable LTFT Agreement and issued by a bank whose
long-term unsecured and unguaranteed debt is rated at least "A" by S&P and "A2"
by Xxxxx'x. Such letter of credit shall have a term of at least a year and shall
be subject to draw if not renewed or replaced at the end of such term.
"Account Bank" has the meaning assigned to such term in the
Collateral Agency Agreement.
Page 5
"Act," when used with respect to any Holder, has the meaning
specified in Section 1.4.
"Additional Senior Indebtedness" means Indebtedness of the
Company or the Partnership for borrowed money ranking pari passu in right of
payment with the Senior Debt. For the avoidance of doubt, any indebtedness
incurred in respect of an Expansion and described in the proviso to the
definition of Indebtedness shall not constitute Additional Senior Indebtedness
until such time as it constitutes Indebtedness in accordance with the definition
thereof and the Completion Guaranty in respect of such Expansion has been
released.
"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 the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Affiliate Subordinated Debt" means Indebtedness of the
Partnership held by any Partner or an Affiliate of any Partner and subordinated
to the Senior Debt.
"Agency Agreement" means the agreement entered into on the
Closing Date between the Company and the Partnership pursuant to which the
Company agrees to act as agent for the Partnership with respect to the issuance
of the Securities.
"Agent Member" has the meaning specified in Section
2.7(c)(v)(B).
"Applicable Procedures" has the meaning specified in Section
2.7(c)(v)(B).
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 5.12 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Authorized Agent" has the meaning specified in Section
5.12(a).
"Bankruptcy Code" means the United States Bankruptcy Code of
1978, as amended from time to time.
"Basic Agreements" means, collectively, this Indenture, the
Securities and the Security Agreements.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Business Day" means any day other than (a) a Saturday or
Sunday or (b) a day on which commercial banks in New York City or any other city
in which the Trustee's Corporate Trust Office, any Place of Payment or the
Collateral Agent's principal office is located, are authorized or required to
close.
"California Action Project" means the expansion for which the
Partnership filed an application with the FERC in Docket No. CP01-106-000 on
March 15, 2001.
"Capital Expenditures" means, for any period, expenditures
(including, without limitation, the aggregate amount of Capital Lease
Obligations incurred during such period) made by the Partnership to acquire or
construct fixed assets, plant and equipment (including renewals improvements and
replacements) during such period that in accordance with RAP are required to be
capitalized on the Partnership's balance sheet.
Page 6
"Capital Lease Obligations" means, for any Person, all
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under RAP, and, for purposes of this Indenture
the amount of such obligations shall be the capitalized amount thereof
determined in accordance with RAP.
"Capital Stock" of any Person means any and all shares,
interests, participations or other equivalents (however designated) of corporate
stock of, or partnership or other ownership interests in, such Person.
"Casualty Event" means, with respect to any Property of any
Person, any event that causes all or a portion of such Property to be damaged,
destroyed or rendered unfit for normal use for any reason whatsoever, including,
without limitation, any compulsory transfer or taking or transfer under threat
of compulsory transfer or taking of any material part of such Property by any
Governmental Authority.
"Catastrophic Loss" means any Casualty Event with respect to
the Project for which the replacement value of the lost or damaged Property (as
determined by the Executive Committee of the Partnership reasonably and in good
faith) is greater than the greater of (x) 10% of the gross book value of the
Partnership's plant, property and equipment, taken as a whole, and (y)
$100,000,000, as Escalated.
"Clearstream" means Clearstream Banking, societe anonyme.
"Closing Date" means August 13, 2001.
"CO&M Agreement" means the Construction, Operation and
Maintenance Agreement dated as of August 29, 1989, as amended, by and among
MPOC, Mojave Pipeline and the Partnership under which MPOC operates the Common
Facilities.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Collateral" has the meaning assigned to such term in the
Collateral Agency Agreement.
"Collateral Agency Agreement" means the Collateral Agency
Agreement dated as of the Closing Date by and among the Partnership, the
Company, the Trustee and the Collateral Agent.
"Collateral Agent" means The Chase Manhattan Bank, in its
capacity as Partnership Collateral Agent or Funding Collateral Agent under the
Collateral Agency Agreement.
"Common Facilities" means the facilities from Daggett,
California, to termination points in Xxxx County, California, consisting of
approximately 219 miles of pipe jointly owned by the Partnership and Mojave
Pipeline as tenants-in-common.
"Company" means Kern River Funding Corporation.
"Company Order" or "Company Request" means a written order or
request signed in the name of the Company by the Chairman of the Board, a Vice
Chairman of the Board, the President, a Vice President, the Treasurer or the
Assistant Treasurer, and delivered to the Trustee.
"Company Security Agreement" means the Assignment of
Contracts, Pledge and Security Agreement dated as of the Closing Date between
the Company and the Collateral Agent.
"Completion" means, with respect to any Expansion, that (i)
pursuant to FERC certificate compliance requirements and 18 C.F.R. ss.
157.20(c)(3), the Partnership has filed with the FERC notice that such
Expansion's facilities have been constructed and placed into service or that
service has commenced on such facilities, (ii) pursuant to the LTFT Agreements
Page 7
entered into in connection with such Expansion, the Partnership may begin
invoicing the applicable LTFT Shippers the full amount of their periodic
reservation charge payments and (iii) the equity investment, if any, described
in clause (z) of the proviso to the definition of Indebtedness and required so
that the percentage of the costs of such Expansion that are financed with
Indebtedness incurred by the Partnership does not exceed the Applicable
Expansion Debt Level, has been contributed to the Partnership.
"Completion Guaranty" means, with respect to any Expansion, an
unconditional undertaking by Xxxxxxxx, or another entity that has a public debt
rating equal to at least "BBB-" from S&P and "Baa3" from Xxxxx'x, that ensures
Completion of such Expansion.
"Corporate Trust Office" means the office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered which office as of the date of execution of this Indenture is
located at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000.
"Covenant Defeasance" has the meaning specified in Section
11.3.
"Debt Service Coverage Ratio" means, for any period, the ratio
of (a) Operating Cash Flow for such period to (b) Mandatory Senior Debt Service
(excluding the amount of the Final Principal Payment) for such period.
"Debt Service Letter of Credit" means one or more irrevocable,
direct pay letters of credit issued by the Debt Service LOC Provider.
"Debt Service Letter of Credit Obligation" means all
obligations of the Partnership under the Debt Service LOC Reimbursement
Agreement including without limitation all obligations in respect of the Debt
Service Letter of Credit, interest, principal in respect of any notes or bonds
issued thereunder together with any obligation or indemnity for fees, expenses
or damages.
"Debt Service LOC Account" means the special irrevocable
collateral account and funds within such account, established and maintained
pursuant to Section 7.1 of the Collateral Agency Agreement.
"Debt Service LOC Loan" means each loan made by a Debt Service
LOC Provider to the Partnership pursuant to the Debt Service LOC Reimbursement
Agreement.
"Debt Service LOC Provider" means the commercial banks or
financial institutions issuing the Debt Service Letter of Credit.
"Debt Service LOC Reimbursement Agreement" means the Debt
Service LOC Reimbursement Agreement, among the Partnership, the Company and the
Debt Service LOC Provider, dated as of the Closing Date.
"Debt Service Payment Date" means the final day of each month,
commencing on August 31, 2001, provided that payments in respect of principal on
the Securities issued on the Closing Date will not commence until the Debt
Service Payment Date occurring on January 31, 2002.
"Default" means an Event of Default or an event that with
notice or lapse of time or both would become an Event of Default
"Defaulted Interest" has the meaning specified in Section 2.9.
"Defeasance" has the meaning specified in Section 11.2.
"Depository" means, with respect to Securities of any series
issuable in whole or in part in the form of one or more Global Securities, a
clearing agency registered under the Exchange Act that is designated to act as
Depository for such Securities as contemplated by Section 2.3.
"Determination Date" means the second Business Day prior to
the Redemption Date.
Page 8
"Distribution" means (a) all partnership distributions of the
Partnership (in cash, property of the Partnership or obligations) on, or other
payments or distributions on account of, or the setting apart of money for a
sinking or other analogous fund for, or the purchase, redemption, retirement or
other acquisition by the Partnership of, any portion of any partnership interest
in the Partnership, (b) all dividends (in cash, property or obligations) on, or
other payments or distributions on account of, or the setting apart of money for
a sinking or other analogous fund for, or the purchase, redemption, retirement,
or other acquisition of, any shares of any class of stock of the Company or of
any warrant options or other rights to acquire the same, but excluding dividends
payable solely in shares of common stock of the Company and (c) all payments (in
cash, property of the Partnership or obligations) of principal of, interest on
and other amounts with respect to, or other payments on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition by the Partnership of, any
Affiliate Subordinated Debt.
"Dollars" and "$" means lawful money of the United States of
America.
"Economic Make-Whole Premium" means,
(a) with respect to all of the Securities of any series, an amount
calculated by the Company as of the second Business Day prior to the
Redemption Date (the "Determination Date") of the Securities of such
series as follows:
(i) the average life of the remaining scheduled payments of principal in
respect of the Outstanding Securities (the "Remaining Average Life")
shall be calculated as of the Redemption Date;
(ii) the yield to maturity shall be calculated for the United States
Treasury security having an average life equal to the Remaining Average
Life and trading in the secondary market at the price (on the
Determination Date) closest to par (the "Primary Issue"); provided,
however, that if no United States Treasury security has an average life
equal to the Remaining Average Life, the yields (the "Other Yields')
for the two maturities of the United States Treasury securities having
average lives most closely corresponding to such Remaining Average Life
and trading in the secondary market at the price (on the Determination
Date) closest to par shall be calculated and the yield to maturity for
the Primary Issue shall be the yield interpolated or extrapolated from
such Other Yields on a straight-line basis, rounding in each of such
relevant periods to the nearest month;
(iii) the discounted present value of the then remaining scheduled payments
of principal and interest (but excluding that portion of any scheduled
payment of interest that is actually due and paid on the Redemption
Date) in respect of Outstanding Securities shall be calculated as of
the Redemption Date using a discount factor equal to the sum of (a) the
yield to maturity for the Primary Issue, plus (b) 50 basis points; and
(iv) the amount of premium in respect of Securities to be redeemed shall be
an amount equal to (a) the discounted present value of such Securities
to be redeemed determined in accordance with clause (iii) above minus
(b) the unpaid principal amount of such Securities; provided, however,
that the premium shall not be less than zero; and,
(b) with respect to any Security in any series, the amount obtained by
multiplying (i) the aggregate Economic Make-Whole Premium determined as
set forth above by (ii) the ratio of the Outstanding principal amount
of such Security on the Redemption Date to the aggregate Outstanding
principal amount of all Securities of such series on the Redemption
Date.
"Environmental Laws" means any and all present and future
federal, state, local and foreign laws, rules or regulations, and any orders or
decrees in each case as now or hereafter in effect, relating to the regulation
or protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of Hazardous Materials into the
Page 9
indoor or outdoor environment, including, without limitation, ambient air, soil
surface water, ground water, wetlands, land or subsurface strata, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials.
"Escalated" means, with respect to any amount and as at any
date of determination, such amount as multiplied by a fraction (a) the numerator
of which is the Consumer Price Index for All Urban Consumers (CPI/U), as
published by the Bureau of Statistics of the Department of Labor (or if the
publication of such Consumer Price Index is discontinued, a comparable index
similar in nature to the discontinued index which clearly reflects the change in
the real value of the purchasing power of the Dollar (hereafter in this
definition referred to as the "index")) reported for the calendar year
immediately preceding such date and (b) the denominator of which is equal to the
index reported for 2001, provided, however, that if an Escalation has to be
determined in a particular year at a time prior to the time that such Consumer
Price Index is published, the figure used immediately prior thereto shall be
used.
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of
the Euroclear System, or any successor to Euroclear Bank, S.A./N.V., as operator
thereof.
"Event of Default" has the meaning specified in Section 4.1.
"Exchange Act" means, the Securities Exchange Act of 1934 and
any statute successor thereto, in each case as amended from time to time.
"Existing 144A Debt" means existing 144A indebtedness
outstanding under the Trust Indenture, dated as of March 15, 1996, among Kern
River Funding Corporation, as Issuer, Kern River Gas Transmission Company, as
Guarantor, and The Chase Manhattan Bank (formerly called Chemical Bank) as
Trustee.
"Expansion" means any capital investment project that (i)
involves Capital Expenditures in excess of $100,000,000, as Escalated and (ii)
increases the transportation capacity of the Pipeline by at least 100 MMcf per
day.
"Expiration Date" has the meaning specified in Section 1.4.
"FERC" means the Federal Energy Regulatory Commission.
"Final Maturity Date" means, as at any date of determination,
the latest Stated Maturity of any Security then Outstanding.
"Final Principal Payment" means the payment to be made in
respect of principal of the Securities (established by the Partnership pursuant
to Section 2.1 and issued on the Closing Date) on the Final Maturity Date with
respect to such Securities.
"Fitch" means Fitch, Inc. and its successors.
"Global Security" means a Security that evidences all or part
of the Securities of any series or tranche and bears the appropriate legend set
forth in Exhibit A (or such legend as may be specified as contemplated by
Section 2.2 for such Securities).
"Governmental Approval" means any authorization of or by,
consent of, approval of, license from, ruling of, permit from, tariff by, rate
of certification by, exemption from, filing with (except any filing relating to
the perfection of security interests), variance from, claim of, order from,
judgment from, decree of, publication to or by, notice to, declaration of or
with or registration by or with any Governmental Authority.
"Governmental Authority" means any federal, state, municipal
local, territorial or other government department, commission, board, bureau,
agency, regulatory authority, instrumentality, judicial or administrative body,
domestic or foreign.
Page 10
"Governmental Rule" means any statute, law, regulation,
ordinance, rule, final and nonappealable judgment, order, decree, permit,
concession, grant, franchise, license, directive, guideline, policy,
requirement, or other government restriction or any similar form of decision of
or determination by, or any interpretation of any of the foregoing by, any
Governmental Authority, whether now or hereafter in effect (including, without
limitation, any Environmental Law).
"Gross Book Value" means, with respect to any Person, the
gross book value of such Person's plant, property and equipment, taken as a
whole.
"Guarantee" means a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "Guarantee" and "Guaranteed" used as a verb and
the term "Guarantor" shall have correlative meanings.
"Hazardous Material" means, at any time, collectively, (a) any
petroleum or petroleum products, flammable materials, explosives, radioactive
materials, asbestos, urea formaldehyde foam insulation, and transformers or
other equipment that contain polychlorinated biphenyls, (b) any chemicals or
other materials or substances that, at such time, become defined as or included
in the definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "extremely hazardous wastes," "restricted hazardous wastes," "toxic
substances," "toxic pollutants," "contaminants," "pollutants" or words of
similar import under any Environmental Law and (c) any other chemical or other
material or substance, exposure to which, at such time, is prohibited, limited
or contemplated under any Environmental Law.
"Holder" and "Securityholder" means a Person in whose name a
Security is registered in the Security Register.
"Indebtedness" means, for any Person (without duplication)
whether recourse is to all or a portion of the assets of such Person and whether
or not contingent, (a) every obligation of such Person for money borrowed, (b)
every obligation of such Person evidenced by bonds, debentures, notes or other
similar instruments, (c) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person, (d) every obligation of such Person issued or
assumed as the deferred purchase price of Property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business), (e) every Capital Lease Obligation of such Person, (f) the maximum
fixed redemption or repurchase price of Redeemable Stock of such Person, if any,
at the time of determination plus accrued but unpaid dividends, (g) every
obligation of such Person with respect to interest rate and currency hedging
agreements, and (h) every obligation of the type referred to in clauses (a)
through (g) of another Person and all dividends of another Person the payment of
which, in either case, such Person has Guaranteed or is responsible or liable
for, directly or indirectly, as obligor, Guarantor or otherwise; provided,
however, that "Indebtedness" shall not include any indebtedness incurred with
respect to an Expansion provided that, and only for so long as, (x) a Completion
Guaranty with respect to such Expansion is in full force and effect, (y) the
recourse of the holders of such indebtedness is limited as set forth in clause
(b) of Section 8.20 and (z) the Partners are obligated under the terms of the
financing for such Expansion to contribute equity upon Completion in an amount,
if any, that, if such equity were contributed at the time such indebtedness was
incurred and such indebtedness was included in the definition of Indebtedness,
would enable the Partnership to satisfy the tests set forth in clause (a)(iv) of
Section 8.9 and clause (c) of Section 8.20.
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"Indenture" means this instrument as originally executed and
as it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
The term "Indenture" shall also include the terms of particular series of
Securities established as contemplated by Section 2.3.
"Installment Security" means a Security, the principal of
which is payable in installments.
"institutional accredited investors" has the meaning specified
in Section 2.1.
"interest," when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date," when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"Investment" by any Person means any direct or indirect loan,
advance or other extension of credit or capital contribution to (by means of
transfers of cash or other Property to others or payments for Property or
services for the account or use of others, or otherwise), or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Indebtedness issued by, any other Person, and any Capital
Expenditures.
"Investment Company Act" means the Investment Company Act of
1940 and any statute successor thereto, in each case as amended from time to
time.
"Investment Grade" means with respect to any Person, that such
Person's long-term senior unsecured debt is rated at least Baa3 by Moody's, BBB-
by S&P, BBB (low) by Dominion Bond Rating Service, or B++ (low) by Canadian Bond
Rating Service.
"KR Acquisition" means Kern River Acquisition, LLC, a
subsidiary of Xxxxxxxx, and owner of a general partnership interest in the
Partnership with WWPC.
"Lien" means, with respect to any Property, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this Indenture and the other Project Agreements,
a Person shall be deemed to own subject to a Lien any Property that it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
(other than an operating lease) relating to such Property.
"Loss Proceeds Account" has the meaning assigned to such term
in Section 3.1 of the Collateral Agency Agreement.
"LTFT Agreements" means those long-term firm gas
transportation service agreements providing for the transportation of natural
gas, entered into by and among the Partnership and the long-term firm
transportation Shippers and includes, without limitation (i) any long-term firm
transportation service agreements entered into in connection with an expansion
of the Pipeline and (ii) any such agreement entered into after the Closing Date.
"LTFT Shipper" means a Shipper party to an LTFT Agreement.
"Mandatory Senior Debt Service" means, for any period, the sum
of all scheduled interest premium (if any) and principal due and payable during
such period in respect of all Senior Debt, provided that fees payable in
connection with the issuance of any Additional Senior Indebtedness shall be
excluded.
"Material Adverse Effect" means a material adverse effect on
(a) the property, business, operations, financial condition, liabilities or
capitalization of any of the Partnership or the Company, (b) the ability of
Page 12
either such Person to perform any of its payment obligations or any of its other
material obligations under any of the Project Agreements to which such Person is
a party, (c) the validity or enforceability of any of the Project Agreements or
the Senior Debt Agreements, unless immediately after giving effect to such
adverse effect on validity or enforceability, there shall be No Ratings
Downgrade, (d) the material rights and remedies of the Senior Party under any of
the Senior Debt Agreements or (e) the timely payment of any principal of or
interest on any of the Senior Debt.
"Material Loss" means any Casualty Event with respect to the
Project for which the replacement value of the lost or damaged Property (as
determined by the Executive Committee of the Partnership reasonably and in good
faith) is (A) equal to or greater than the greater of (x) 2% of the Gross Book
Value of the Partnership and (y) $10,000,000, as Escalated, and (B) less than
the greater of (i) 10% of the Gross Book Value of the Partnership and (ii)
$100,000,000, as Escalated.
"Maturity," when used with respect to any Security, means the
date on which the principal of such Security or an instalment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise.
"Mojave Pipeline" means Mojave Pipeline Company.
"Moody's" means Xxxxx'x Investors Service, Inc. and its
successors.
"MPOC" means the Mojave Pipeline Operating Company, an
affiliate of Mojave Pipeline and operator of the Common Facilities.
"No Ratings Downgrade" means that the ratings on the
Securities are reaffirmed as being equal to or higher than the rating on the
Securities before the applicable event, by both of the Required Rating Agencies.
"Notice of Default" means a written notice of the kind
specified in Section 5.2.
"NRSRO" means any Nationally Recognized Statistical Ratings
Organization.
"Obligor" means, individually and collectively, the
Partnership and the Company.
"Officer's Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman of the Board, the President, a Vice
President, the Treasurer or the Assistant Treasurer of the Company or a Senior
Officer of the Partnership, as applicable, and delivered to the Trustee.
"Operating Cash Flow" means, for any period, the excess, if
any, of (a) all Project Revenues received during such period over (b) all
Operating Expenses paid during such period other than any nonrecurring Operating
Expenses incurred in connection with the issuance of any Additional Senior
Indebtedness.
"Operating Expenses" means, for any period, the sum, computed
without duplication, of all cash operating and maintenance expenses and required
reserves in respect of such expenses of the Project including, without
limitation, (a) expenses of administering and operating the Project and of
maintaining it in good repair and operating condition payable by the Partnership
during such period, (b) direct operating and maintenance costs of the Project
(including, without limitation, all payments due and payable under the CO&M
Agreement and any ground leases) payable by the Partnership during such period,
(c) insurance costs payable by the Partnership during such period, (d) sales and
excise taxes payable by the Partnership with respect to the transportation of
natural gas during such period, (e) franchise taxes payable by the Partnership
during such period, (f) federal, state and local income taxes payable by the
Partnership, if any, during such period, (g) costs and fees attendant to the
obtaining and maintaining in effect the government approvals payable by the
Partnership during such period and (h) legal, accounting and other professional
fees attendant to any of the foregoing items payable by the Partnership during
Page 13
such period. Operating Expenses excludes, to the extent otherwise included,
depreciation and other non-cash expenditures for such period.
"Operative Agreements" means the LTFT Agreements, the Shipper
Guarantees and the Partnership Guarantee.
"Opinion of Counsel" means a written opinion of counsel who
may be in-house counsel for the Company or the Partnership, and who and which
shall be reasonably acceptable to the Trustee.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 4.2.
"Outstanding," when used with respect to Securities, means, as
of the date of determination, all Securities therefore authenticated and
delivered under this Indenture, except:
(1) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been therefore deposited with the Trustee or any Paying
Agent (other than the Company) in trust or set aside and segregated in
trust by the Company (if the Company shall act as its own Paying Agent)
for the Holders of such Securities; provided that, if such Securities
are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant to Section
11.2; and
(4) Securities which have been paid pursuant to Section 2.8 or in exchange
for or in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide
purchaser in whose hands such Securities are valid obligations of the
Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount of
the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 4.2, (B)
if, as of such date, the principal amount payable at the Stated Maturity of a
Security is not determinable, the principal amount of such Security which shall
be deemed to be Outstanding shall be the amount as specified or determined as
contemplated by Section 2.3, (C) the principal amount of a Security denominated
in one or more foreign currencies or currency units which shall be deemed to be
Outstanding shall be the U.S. dollar equivalent, determined as of such date in
the manner provided as contemplated by Section 2.3, of the principal amount of
such Security (or, in the case of a Security described in clause (A) or (B)
above, of the amount determined as provided in such clause), and (D) Securities
owned by the Obligors or any other obligor upon the Securities or any Affiliate
of either Obligor or of such other obligor shall be disregarded and deemed not
to be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent, waiver or other action, only Securities which the Trustee knows
to be so owned shall be so disregarded. Securities 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 Securities and that the pledgee is not either of the Obligors or any other
obligor upon the Securities or any Affiliate of either Obligor or of such other
obligor.
Page 14
"Partner Agreements" means the Partnership Agreement and the
Purchase Agreement.
"Partners" means WWPC and KR Acquisition and such other Person
or Persons as may become general partners of the Partnership from time to time.
"Partnership" means the Person named as the "Partnership" in
the first paragraph of this instrument until a successor Person shall have
become such pursuant to the applicable provisions of this Indenture, and
thereafter "Partnership' means such successor Person.
"Partnership Agreement" means the General Partnership
Agreement, dated May 29, 1985 as amended, among Kern River Corporation, WWPC and
KR Acquisition.
"Partnership Guarantee" means the Guarantee of the Partnership
hereunder.
"Partnership Loan Agreement" means the loan agreement, dated
as of the Closing Date, between the Partnership and the Company, pursuant to
which the Company will lend the proceeds of the sale of the Securities to the
Partnership.
"Partnership Loan" means the loan made by the Company to the
Partnership from the proceeds of the sale of the Securities.
"Partnership Security Agreement" means the Assignment of
Contracts, Pledge and Security Agreement dated as of the Closing Date between
the Partnership and the Collateral Agent.
"Paying Agent" means any Person authorized by the Company to
pay the principal of or any premium or interest on any Securities on behalf of
the Company pursuant to Section 5.12.
"Peril" means, collectively, fire, lightning, flood,
windstorm, hail, earthquake, explosion, vandalism and malicious mischief, damage
from aircraft, vehicles and smoke.
"Permitted Investments" means:
(a) direct obligations of the United States of America, or of any agency or
instrumentality thereof or obligations guaranteed or insured as to principal and
interest by the United States of America or by any agency or instrumentality
thereof in either case maturing not more than 365 days from the date of
acquisition thereof, or
(b) commercial paper or bankers acceptances having (on the date of acquisition
thereof) a rating from S&P of at least "A-1" or from Moody's of at least "P-1"
(or an equivalent rating from another NRSRO if neither of such corporations is
then in the business of rating commercial paper) maturing not more than 180 days
from the date of acquisition thereof, or
(c) certificates of deposit and other time deposits issued by any bank or trust
company having capital surplus and undivided profits of at least $500,000,000
whose long-term unsecured senior indebtedness is rated "A-" or better by S&P or
"A-3" or better by Moody's (or an equivalent rating from another NRSRO if
neither of such corporations is then in the business of rating such
obligations); or
(d) repurchase agreements with respect to (and secured by a pledge of)
securities described in clause (a) above and entered into with any commercial
bank described in clause (c) above or any securities broker-dealer of recognized
national standing.
"Person" means any individual, corporation, company, voluntary
association, partnership, joint venture, trust, unincorporated organization or
government (or any agency, instrumentality or political subdivision thereof).
"Pipeline" or "Project" means the 926 mile United States
interstate pipeline system that transports natural gas produced in the Rocky
Page 15
Mountain areas to major gas consuming markets in Utah, Nevada and California
with an approximate capacity of 700 Mmcf per day, plus the California Action
Project and any expansions financed in whole or in part with Additional Senior
Indebtedness.
"Place of Payment," when used with respect to the Securities
of any series, means New York, New York, and the place or places where the
principal of and any premium and interest on the Securities of that series are
payable as specified as contemplated by Section 2.3.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 2.8 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Amount" means the principal sum of Dollars.
"Proceeds" means, in the case of any Casualty Event, the
aggregate amount of proceeds of insurance, condemnation awards and other
compensation received by the Partnership and the Company in respect of such
Casualty Event, in each case net of reasonable expenses incurred by the
Partnership and the Company in connection therewith and any income and transfer
taxes payable by the Partnership or the Company in respect of such Casualty
Event.
"Project Agreements" means the Operative Agreements, the
Partnership Agreement and the CO&M Agreement.
"Project Revenues" means revenues received by the Partnership
pursuant to the Operative Agreements.
"Projected Debt Service Coverage Ratio" means, at any time of
determination thereof, a projection of the Debt Service Coverage Ratio for a
period which includes, or consists entirely of, future periods, prepared by the
Partnership in good faith based upon assumptions reasonably believed by the
Partnership to be consistent in all material respects with the Transaction
Agreements and the historical operating results of the Project as adjusted by
reasonable assumptions as to future operating results including any changes in
efficiency or capacity.
"Property" means any right or interest in or to property of
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Purchase Agreement" means the Purchase Agreement, to be
entered into on or about the Closing Date, between the initial purchasers of the
Securities, the Company, the Partnership, and the Partners, providing for the
sale of the Securities to the initial purchasers.
"QIB" has the meaning ascribed thereto in Rule 144A under the
Securities Act.
"Qualified Transaction" means any transaction made in
accordance with the following:
(a) with the prior written consent of the Required Senior Parties; or
(b) with respect to which the Partnership or the Company shall have obtained,
and shall have delivered to the Collateral Agent a copy thereof certified by the
Partnership or the Company, as applicable, the prior written affirmation from
the Required Ratings Agencies that there is No Ratings Downgrade; provided,
that, to the extent such Qualified Transaction involves a merger, consolidation
or amalgamation of an Obligor, the successor in interest to such Obligor agrees
to assume by an instrument in form satisfactory to the Required Senior Parties
all obligations of such Obligor under the Indenture, pursuant to the Securities
and pursuant to all other agreements entered into by such Obligor in connection
with the offering of the Securities.
Page 16
"Qualified Transferee" means any person that shall acquire
after the Closing Date, directly or indirectly, ownership of membership
interests in the Partnership so long as (i) such person has, or is controlled by
a person that has, (a) significant experience in the business of owning and
operating pipeline systems similar to the Pipeline and (b) a public debt rating
equal to at least "BBB-" by S&P and "Baa3" by Moody's, (ii) after giving effect
to such transfer, no Default or Event of Default shall have occurred and be
continuing, and (iii) such transfer could not reasonably be expected to result
in a Material Adverse Effect.
"RAP" means regulatory accounting principles as in effect in
the United States from time to time.
"Rate Refund" means any refunds owed to Shippers or any other
Person or tariffs charged to such Shippers by the Partnership during a pending
FERC rate proceeding as determined by FERC pursuant to a Rate Review.
"Rate Review" means a FERC rate proceeding reviewing the
tariff set by the Partnership for firm transportation services.
"Redeemable Stock" of any Person means any Capital Stock of
such Person that by its terms or otherwise is required to be redeemed on or
prior to the Final Maturity Date.
"Redemption Date," when used with respect to any Security to
be redeemed, means the date set for such redemption by or pursuant to this
Indenture.
"Redemption Price," when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 2.3 (whether or not a Business Day).
"Regulation D" means Regulation D under the Securities Act and
any successor thereto, in each case as amended from time to time.
"Regulation S" means Regulation S under the Securities Act and
any successor thereto, in each case as amended from time to time.
"Regulation S Global Security" means the Temporary Regulation
S Global Security or the Regulation S Unrestricted Global Security, as
applicable.
"Regulation S Unrestricted Global Security" has the meaning
specified in Section 2.1.
"Relevant Party" means the Partnership, the Company and the
Partners.
"Repayment Period" means the one month period beginning with
each Debt Service Payment Date and ending on the date immediately prior to the
next Debt Service Payment Date.
"Required Amount Condition" means that any of (i) the undrawn
available amount under the Debt Service Letter of Credit as in effect at the
date of a proposed Distribution, (ii) the Partnership's unrestricted cash or
(iii) the sum of (i) and (ii) equals the aggregate of the Debt Service Payments
due during the six Repayment Periods following the date of such proposed
Distribution.
"Required Rating Agencies" means S&P and Xxxxx'x.
"Required Senior Parties" has the meaning assigned to such
term in the Collateral Agency Agreement.
"Responsible Officer" when used with respect to the Trustee,
means any officer within the Institutional Trust Services department (or any
Page 17
successor department or group) of the Trustee, including, without limitation,
any senior trust officer, any trust officer, any vice president, any assistant
vice president, any assistant secretary, or any assistant treasurer or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Global Security" has the meaning specified in
Section 2.1.
"Restricted Period" has the meaning specified in Section 2.1.
`"Restricted Securities" has the meaning specified in Section
2.2.
"Rule 144A" means Rule 144A under the Securities Act and any
rule or regulation successor thereto, in each case as amended from time to time.
"Rule 144A Information" has the meaning specified in Section
8.17.
"S&P" means Standard & Poor's Ratings Group, a division of
XxXxxx-Xxxx, and its successors.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
"Securities Act" means the Securities Act of 1933 and any
statute successor thereto, in each case as amended from time to time.
"Security Agreements" means, collectively, the Collateral
Agency Agreement, the Company Security Agreement and the Partnership Security
Agreement.
"Securities Account" has the meaning assigned to such term in
the Collateral Agency Agreement.
"Securities Percentage" means, at any date of determination,
the ratio (expressed as a percentage) of (a) the aggregate Principal Amount of
Securities Outstanding as at such date to (b) the sum of the then outstanding
Senior Debt.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 2.7.
"Senior Debt" has the meaning assigned to such term in the
Collateral Agency Agreement.
"Senior Debt Agreements" has the meaning assigned to such term
in the Collateral Agency Agreement.
"Senior Officer" means (a) with respect to the Partnership,
the President, any Vice President, Treasurer or Assistant Treasurer of the
Partnership or any Partner and any other individual who is directly responsible
for the general oversight and management of the business of the Partnership
designated in writing to the Trustee by a Senior Officer of the Partnership and
(b) with respect to the Company, the Chairman of the Board, President, any Vice
President, the Treasurer or Assistant Treasurer of the Company and any other
individual who is directly responsible for the general oversight and management
of the business of the Company designated in writing to the Trustee by a Senior
Officer of the Company.
"Senior Parties" has the meaning assigned to such term in the
Collateral Agency Agreement.
"Shipper Guarantees" means those agreements providing
financial and performance guarantees to certain of the long-term firm
transportation Shippers.
Page 18
"Shippers" means those Persons party to the Transportation
Service Agreements with the Partnership.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Company pursuant to Section 2.9.
"Stated Maturity," when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"Subsidiary" means, with respect to any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have voting power by reason of the happening of
any contingency) is at the time directly or indirectly owned or controlled by
such Person or one or more Subsidiaries of such Person or by such Person and one
or more Subsidiaries of such Person.
"Surrendered Securities" has the meaning specified in Exhibit
D attached hereto.
"Temporary Regulation S Global Security" has the meaning
specified in Section 2.1.
"Total Capitalization" shall mean, with respect to any Person,
the sum, without duplication, of (i) total common stock equity or analogous
ownership interests of such Person, (ii) preferred stock and preferred
securities of such Person, (iii) additional paid-in capital or analogous
interest of such Person, (iv) retained earnings of such Person and (v) the
aggregate principal amount of Indebtedness of such Person then outstanding.
"Transaction Agreements" means, collectively, the Senior Debt
Agreements, the Project Agreements and the Security Agreements.
"Transfer" means any (a) direct or indirect sale, pledge,
lease, assignment, transfer, merger, dissolution or other disposition effecting
a transfer of any of a Partner's partnership interest in the Partnership or (b)
a dissolution, wind-up, liquidation or other termination of the existence of the
Partnership.
"Transfer Certificate" means a certificate in the form of
Exhibits B, C and D, as applicable.
"Transferor" has the meaning specified in Exhibits B-E.
"Transportation Service Agreements" means those shipper
contracts pursuant to which the Partnership provides for the transportation of
natural gas for the Shippers.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and the "Trustee" means
or includes each Person who is then a Trustee hereunder, and if at any time
there is more than one such Person, "Trustee" as used with respect to the
Securities of any series means the Trustee with respect to Securities of that
series.
"U.S. Government Obligation" has the meaning specified in
Section 11.4.
Page 19
"Vice President," when used with respect to the Company means
any vice president, whether or not designated by a number or a word or words
added before or after the title "vice president."
"Wholly Owned Subsidiary" means, with respect to any Person,
any corporation, partnership or other entity of which all of the equity
securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) are directly or indirectly owned or
controlled by such Person or one or more Wholly Owned Subsidiaries of such
Person or by such Person and one or more Wholly Owned Subsidiaries of such
Person.
"Xxxxxxxx" means The Xxxxxxxx Companies, Inc.
"WWPC" means Xxxxxxxx Western Pipeline Company, LLC, a
subsidiary of Xxxxxxxx and owner of a general partnership interest in the
Partnership with KR Acquisition.
SECTION 1.2.......Compliance Certificates and Opinions. Upon any application or
request by the Company or the Partnership to the Trustee to take any action
under any provision of this Indenture, the Company or the Partnership, as the
case may be, shall furnish to the Trustee such certificates and opinions as may
be reasonably requested by the Trustee. Each such certificate or opinion shall
be given in the form of an Officer's Certificate, if to be given by an officer
of the Company or a Senior Officer of the Partnership, as the case may be, or an
Opinion of Counsel, if to be given by counsel and shall satisfy the requirements
set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or opinion has
read such covenant or condition and the definitions herein relating thereto;
(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 each such individual, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether, in the opinion of each such individual, such
condition or covenant has been complied with.
SECTION 1.3.......Form of Documents Delivered to Trustee. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the Company or of
the Partnership may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such officer
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or Opinion
of Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Company or a Senior Officer of the Partnership, as the case may be, stating that
the information with respect to such factual matters is in the possession of the
Company or the Partnership, as the case may be, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Page 20
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 1.4.......Acts of Holders; Record Dates. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Indenture to be given, made or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agent duly appointed in writing,
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company and the Partnership. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 5.1) conclusive in favor of the Trustee, the
Company and the Partnership, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security
Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee, the
Company or the Partnership in reliance thereon, whether or not notation of such
action is made upon such Security.
The Company may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take or revoke the relevant action, whether or not such
Holders remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date (as defined below) by Holders of the requisite principal amount
of Outstanding Securities of such series on such record date. Nothing in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be canceled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
The Trustee may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities of any series entitled to
Page 21
join in the giving or making of (i) any declaration of acceleration referred to
in Section 4.2, (ii) any request to institute proceedings referred to in Section
4.7(b) or (iii) any direction referred to in Section 4.12, in each case with
respect to Securities of such series. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Securities of such series on such record
date, and no other Holders, shall be entitled to join in such declaration,
request or direction or any revocation thereof, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Trustee from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be canceled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Securities of the relevant series on the date such action
is taken. Promptly after any record date is set pursuant to this paragraph, the
Trustee, at the Company's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Company in writing and to each Holder of Securities of the relevant series in
the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section
1.4, the party hereto which sets such record date may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other parties hereto
in writing, and to each Holder of Securities of the relevant series in the
manner set forth in Section 1.6, on or prior to the existing Expiration Date. If
an Expiration Date is not designated with respect to any record date set
pursuant to this Section, the party hereto which set such record date shall be
deemed to have initially designated the 180th day after such record date as the
Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the foregoing, no
Expiration Date shall be later than the 180th day after the applicable record
date.
Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the Principal Amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
SECTION 1.5.......Notices, Etc., to Trustee, Company and Partnership. Any
request demand, authorization, direction, notice, consent, waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(a) the Trustee by any Holder, by the Company or by the Partnership shall be
sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee at its Corporate Trust Office, 000 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX, 00000, Attention: Institutional Trust
Services, or
(b) the Company by the Trustee, by any Holder or by the Partnership shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the Company
at Xxx Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxxx, 00000, Attention: Treasurer or at any
other address previously furnished in writing to the Trustee and the
Partnership, or
(c) the Partnership by the Trustee, by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the
Partnership at 000 Xxxxxxx Xxx, Xxxx Xxxx Xxxx, Xxxx, 00000, Attention: General
Counsel or at any other address previously furnished in writing to the Trustee
and the Company.
SECTION 1.6.......Notice to Holders; Waiver. Where this Indenture provides for
Page 22
notice to Holders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first-class
postage prepaid, to each Holder affected by such event, at its address as it
appears in the Security Register, not later than the latest date (if any), and
not earlier than the earliest date (if any), prescribed for the giving of such
notice. In any case where notice to Holders is given by mail neither the failure
to mail such notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to other
Holders. Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 1.7.......Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 1.8.......Successors and Assigns. All covenants and agreements in this
Indenture by the Obligors shall bind their successors and assigns, whether so
expressed or not.
SECTION 1.9.......Separability Clause. In case any provision in this Indenture
or in the Securities 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 1.10......Benefits of Indenture. Nothing in this Indenture or in the
Securities, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder and the Holders, any benefit or any legal
or equitable right, remedy or claim under this Indenture.
SECTION 1.11......Governing Law. This Indenture and the Securities shall be
governed by and construed in accordance with the laws of the State of New York
without giving effect to the principles thereof relating to conflicts of law
except Section 5-1401 of the New York General Obligation Law.
SECTION 1.12......Legal Holidays. In any case where any Interest Payment Date,
Redemption Date or Stated Maturity of any Security shall not be a Business Day
at any Place of Payment, then (notwithstanding any other provision of this
Indenture or of the Securities (other than a provision of any Security which
specifically states that such provision shall apply in lieu of this Section
1.12)) payment of interest or principal (and premium, if any) need not be made
at such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made
on the Interest Payment Date or Redemption Date or at the Stated Maturity, and
no interest shall accrue on such payment for the period from and after such
date.
SECTION 1.13......Counterparts. This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument.
SECTION 1.14......Agency. In executing the Securities and this Indenture, the
Company will be acting both as principal and as agent for the Partnership to the
extent of the Partnership's obligations under the Indenture. As used in this
Indenture, references to the "Company" shall be interpreted to include the
Company in its capacity as principal and the Company in its capacity as agent
pursuant to the Agency Agreement.
Page 23
ARTICLE 2
THE SECURITIES
SECTION 2.1.......Forms Generally. The Securities of each series shall be in
substantially the form set forth in Exhibit A or in such other form as shall,
subject to Section 2.5, be established by or pursuant to an Officer's
Certificate or in one or more indentures supplemental hereto, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities exchange or
Depository therefor or as may, consistently herewith, be determined by the
officers executing such Securities as evidenced by their execution thereof.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Except as otherwise provided pursuant to Section 2.3,
Restricted Securities shall bear the applicable legends as set forth in Exhibit
A and as provided in Section 2.2 and Installment Securities shall bear the
following legend:
"THIS SECURITY IS AN INSTALLMENT SECURITY (AS DEFINED IN THE INDENTURE
HEREINAFTER REFERRED TO). ACCORDINGLY, THE FACE AMOUNT HEREOF MAY EXCEED THE
UNPAID PRINCIPAL AMOUNT HEREOF AND ANY TRANSFEREE OF THIS SECURITY MAY NOT RELY
ON THE FACE AMOUNT HEREOF AS EVIDENCE OF THE AMOUNT DUE AND OWING ON THIS
SECURITY BUT IS ADVISED TO DETERMINE SUCH UNPAID PRINCIPAL AMOUNT FROM THE
RECORDS OF THE COMPANY OR ITS PAYING AGENT."
and shall set forth either on the face or the reverse thereof or, if a Global
Security, on a schedule attached thereto, such Security's schedule of principal
installments.
Except as otherwise provided pursuant to Section 2.3,
Securities of any series offered and sold in their initial distribution in
reliance on Rule 144A shall be issued in the form of one or more Global
Securities of such series (each a "Restricted Global Security") in definitive,
fully registered form without interest coupons, substantially in the form set
forth in Exhibit A, or in such other form as shall, subject to Section 2.5, be
established by or pursuant to an Officer's Certificate or in one or more
indentures supplemental hereto, with such applicable legends as are provided for
in Exhibit A. Such Global Securities shall be registered in the name of the
Depository for such Global Securities or its nominee and deposited with the
Trustee, at its Corporate Trust Office, as custodian for such Depository, duly
executed on behalf of the Company and authenticated by the Trustee as herein
provided. The aggregate principal amount of any Restricted Global Security may
from time to time be increased or decreased by adjustments made on the records
of the Trustee, as custodian for the Depository for such Global Security, as
provided in Section 2.7, which adjustments shall be conclusive as to the
aggregate principal amount of any such Global Securities. Except as otherwise
provided pursuant to Section 2.3 or agreed by the Company, no Restricted Global
Security shall be issued except as provided in this paragraph to evidence
Securities offered and sold in their initial distribution in reliance on Rule
144A.
Except as otherwise provided pursuant to Section 2.3,
Securities of any series offered and sold in their initial distribution in
reliance on Regulation S under the Securities Act shall be issued initially in
the form of one or more temporary global Securities (a "Temporary Regulation S
Global Security") of such series in definitive, fully registered form without
interest coupons, substantially in the form set forth in Exhibit A, or in such
other form as shall, subject to Section 2.5, be established by or pursuant to an
Officer's Certificate or in one or more indentures supplemental hereto, with
such applicable legends as are provided for in Exhibit A. Such Temporary
Regulation S Global Securities shall be issued to the Depository and registered
in the name of the Depository for such Global Securities or its nominee and
deposited with the Trustee, at its Corporate Trust Office, as custodian for such
Depository, duly executed by the Company and authenticated by the Trustee as
herein provided, for credit to the respective accounts of beneficial owners of
such Securities (or to such other accounts as they may direct) at Euroclear
Bank, S.A./N.V., as operator of Euroclear or Clearstream. Beneficial interests
Page 24
in any Temporary Regulation S Global Security may be held only through Euroclear
or Clearstream. Within a reasonable period of time after the expiration of the
40-day restricted period (within the meaning of Rule 903(c)(3) of Regulation S
under the Securities Act) (the "Restricted Period"), any Temporary Regulation S
Global Security will be exchanged for a permanent Regulation S Global Security
(the "Regulation S Unrestricted Global Security," together with the Temporary
Regulation S Global Security, the "Regulation S Global Security") substantially
in the form set forth in Exhibit A with such applicable legends as are provided
for in Exhibit A, but without the Restricted Securities Legend set forth in
Exhibit A upon delivery to the Depository of certification of non-United States
ownership and compliance with Regulation S under the Securities Act. The
Regulation S Unrestricted Global Security will be deposited with the Trustee at
its Corporate Trust Office, as custodian for the Depository and registered in
the name of the nominee of the Depository. Clearstream and Euroclear will hold
beneficial interests in the Regulation S Unrestricted Global Security on behalf
of their participants through their respective depositories, which in turn will
hold such beneficial interests in the Regulation S Unrestricted Global Security
in participants' securities accounts in the depositories' names on the books of
the Depository. The aggregate principal amount of any Temporary Regulation S
Global Security and any Regulation S Unrestricted Global Security may from time
to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depository for such Global Security, as provided
in Section 2.7, which adjustments shall be conclusive as to the aggregate
principal amount of any such Global Security. As used herein, the term
"Restricted Period," with respect to Global Securities of any series (or of any
identifiable tranche of any series) offered and sold in reliance on Regulation
S, means the period of 40 consecutive days beginning on and including the later
of (i) the day on which the Securities of such series (or tranche) are first
offered to persons other than distributors (as defined in Regulation S) in
reliance on Regulation S (according to a notice to the Company and the Trustee
by the underwriter(s), if any, of the offering of such Securities) and (ii) the
date of the closing of the offering. Except as otherwise provided pursuant to
Section 2.3 or agreed by the Company, no Temporary Regulation S Global Security
or Regulation S Unrestricted Global Security shall be issued except as provided
in this paragraph to evidence Securities offered and sold in their initial
distribution in reliance on Regulation S under the Securities Act.
Except as otherwise provided pursuant to Section 2.3,
Securities of any series offered and sold in their initial distribution to a
limited number of institutions that are accredited investors (which are not
qualified institutional buyers, as defined under Rule 144A) within the meaning
of Rule 501(a)(1), (2), (3) or (7) under the Securities Act (and institutions in
which all the equity owners are such accredited investors) (together referred to
as "institutional accredited investors") in transactions exempt from
registration under the Securities Act shall be issued in definitive, fully
registered form without interest coupons, substantially in the form set forth in
Exhibit A, with such applicable legends as are provided for in Exhibit A. Such
Securities shall be delivered to such institutional accredited investors only
upon the execution and delivery to the Company and the underwriter(s), if any,
of the offering of such Securities of a purchaser's letter, substantially in the
form set forth in Exhibit E. Such Securities may not be exchanged for interests
in a Global Security except as provided in Section 2.7(c)(v)(E).
SECTION 2.2.......Legends on Restricted Securities. Except as otherwise provided
pursuant to Section 2.3, all Securities of any series (or any identifiable
tranche of any series) issued pursuant to this Indenture (including Securities
issued upon registration of transfer, in exchange for or in lieu of such
Securities) shall be "Restricted Securities," and shall bear the applicable
legend(s) setting forth restrictions on transfer provided in Exhibit A;
provided, however, that the term "Restricted Securities" shall not include (i)
Temporary Regulation S Global Securities or Regulation S Unrestricted Global
Securities, (ii) Securities as to which such restrictive legend(s) shall have
been removed pursuant to Section 2.7 and (iii) Securities issued upon
registration of transfer of, in exchange for, or in lieu of, Securities that are
not Restricted Securities.
SECTION 2.3.......Amount Unlimited; Issuable in Series. Subject to the
provisions of Section 8.9, the aggregate principal amount of Securities which
may be authenticated and delivered under this Indenture is unlimited.
Page 25
The Securities may be issued in one or more series. There
shall be established, subject to Section 2.5, by or pursuant to an Officer's
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,
(a) the title of the Securities of the series (which shall distinguish the
Securities of the series from Securities of any other series);
(b) any limit upon the aggregate principal amount of the Securities of the
series which may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the series pursuant to Section
2.6, 2.7, 2.8 or 9.7 and except for any Securities which pursuant to Section
2.5, are deemed never to have been authenticated and delivered hereunder);
(c) the Person to whom any interest on a Security of the series shall be
payable, if other than the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
(d) the date or dates on which the principal of any Securities of the series is
payable and whether such Securities shall constitute Installment Securities;
(e) the rate or rates at which any Securities of the series shall bear interest,
if any, the date or dates from which any such interest shall accrue, the
Interest Payment Dates on which any such interest shall be payable and the
Regular Record Date for any such interest payable on any interest payment;
(f) the place or places where the principal of and any premium and interest on
any Securities of the series shall be payable;
(g) the period or periods within which, the price or prices at which, and the
terms and conditions upon which, any Securities of the series may be redeemed,
in whole or in part, at the option of the Company and the manner in which any
election by the Company to redeem the Securities shall be evidenced;
(h) the obligation, if any, of the Company to redeem or purchase any Securities
of the series pursuant to any sinking fund or analogous provisions or at the
option of the Holder thereof and the period or periods within which, the price
or prices at which, and the terms and conditions upon which, any Securities of
the series shall be redeemed or purchased, in whole or in part, pursuant to such
obligation;
(i) whether the Securities of the series shall initially be represented by
Global Securities or definitive Securities and, if other than denominations of
$100,000 and any integral multiple of $1,000 in excess thereof, the
denominations in which any Securities of the series shall be issuable;
(j) if the amount of principal of or any premium or interest on any Securities
of the series may be determined with reference to an index or pursuant to a
formula or other measure, the manner in which such amounts shall be determined;
(k) if other than the currency of the United States of America, the currency,
currencies or currency units in which the principal of or any premium or
interest on any Securities of the series shall be payable and the manner of
determining the equivalent thereof in the currency of the United States of
America for any purpose, including for purposes of the definition of
"Outstanding" in Section 1.1;
(l) if the principal of or any premium or interest on any Securities of the
series is to be payable, at the election of the Company or the Holder thereof,
in one or more currencies or currency units other than that or those in which
such Securities are stated to be payable, the currency, currencies or currency
units in which the principal of or any premium or interest on such Securities as
to which such election is made shall be payable, the periods within which and
the terms and conditions upon which such election is to be made and the amount
so payable (or the manner in which such amount shall be determined);
(m) if other than the entire Principal Amount thereof, the portion of the
Principal Amount of any Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 4.2;
Page 26
(n) if the Principal Amount payable at the Stated Maturity of any Securities of
the series will not be determinable as of any one or more dates prior to the
Stated Maturity, the amount which shall be deemed to be the Principal Amount of
such Securities as of any such date for any purpose thereunder or hereunder,
including the Principal Amount thereof which shall be due and payable upon any
Maturity other than the Stated Maturity or which shall be deemed to be
Outstanding as of any date prior to the Stated Maturity (or, in any such case,
the manner in which such amount deemed to be the Principal Amount shall be
determined);
(o) if applicable, that the Securities of the series, in whole or any specified
part, shall be defeasible pursuant to Section 11.2 or 11.3 or both such Sections
and the manner in which any election by the Company to defease such Securities
shall be evidenced;
(p) if applicable, that any Securities of the series shall be issuable in whole
or in part in the form of one or more Global Securities and, in such case, the
respective Depositaries for such Global Securities, the form of any legend or
legends which shall be borne by any such Global Security in addition to or in
lieu of that set forth in Exhibit A or pursuant to Section 2.2 and any
circumstances in addition to or in lieu of those set forth in Section 2.7 in
which any such Global Security may be exchanged in whole or in part for
Securities registered and any transfer of such Global Security in whole or in
part may be registered, in the name or names of Persons other than the
Depository for such Global Security or a nominee thereof,
(q) the form of any legend(s) which shall be borne by any Restricted Securities
in addition to or in lieu of that set forth in Exhibit A, any circumstances in
addition to or in lieu of those set forth in Section 2.7 in which such legend(s)
may be removed or modified, and any circumstances in addition to or in lieu of
those set forth in Section 2.7 in which Restricted Securities may be registered
for transfer or may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in a Global Security and any related certificates
in addition to or in lieu of those set forth in Section 2.13;
(r) any addition to or change in the Events of Default which applies to any
Securities of the series and any change in the right of the Trustee or the
requisite Holders of such Securities to declare the principal amount thereof due
and payable pursuant to Section 4.2;
(s) any addition to a change in the covenants set forth in Article 8 which
applies to Securities of the series: and
(t) any other terms of the series (which terms shall not be inconsistent with
the provisions of this Indenture, except as permitted by Section 7.1(e)).
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided by
or pursuant to the Officer's Certificate referred to above or in any such
indenture supplemental hereto.
SECTION 2.4.......Denominations. The Securities of each series shall be issuable
only in registered form without coupons and only in such denominations as shall
be specified as contemplated by Section 2.3. In the absence of any such
specified denomination with respect to the Securities of any series pursuant to
Section 2.3, the Securities of such series shall be issuable in denominations of
$100,000 and any integral multiple of $1,000 in excess thereof. The denomination
of an Installment Security shall be deemed to be the Dollar amount set forth on
the face thereof and not the unpaid Principal Amount thereof. The Dollar amount
set forth on the face of an Installment Security shall be the Principal Amount
of such Security (or any Predecessor Security) upon the original issuance
thereof.
SECTION 2.5.......Execution, Authentication, Delivery and Dating. The Securities
shall be executed on behalf of the Company by a Senior Officer of the Company
and on behalf of the Partnership by a Senior Officer of the Partnership. The
signature of any of these officers on the Securities may be manual or facsimile.
Page 27
Securities bearing the manual or facsimile signature of
individuals who were at the time of execution the Senior Officers of the Company
or the Partnership shall bind the Company or the Partnership, as the case may
be, notwithstanding that such individuals or any of them have ceased to hold
such offices prior to the authentication and delivery of such Securities or did
not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities. If the form or terms of the Securities of the series have been
established by or pursuant to an Officer's Certificate as permitted by Sections
2.1 and 2.3, in authenticating such Securities, and accepting any additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 5.1) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(a) that such form has been established in conformity with the provisions of
this Indenture;
(b) that such terms have been established in conformity with the provisions of
this Indenture; and
(c) that such Securities, when authenticated and delivered by the Trustee and
issued by the Company in the manner and subject to any conditions specified in
such Opinion of Counsel, will constitute valid and legally binding obligations
of the Company, enforceable against the Company in accordance with their terms
(subject to customary qualifications or exceptions).
The Trustee shall also be entitled to receive an Officer's
Certificate of each of the Company and the Partnership stating that, immediately
after the authentication and delivery of such Securities, no Default or Event of
Default will have occurred.
If such form or terms have been so established, the Trustee
shall not be required to authenticate such Securities if the issue of such
Securities pursuant to this Indenture will affect the Trustee's own rights,
duties or immunities under the Securities and this Indenture or otherwise in a
manner which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 2.3 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officer's
Certificate otherwise required pursuant to Section 2.3 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the authentication of each Security of such series if such documents
are delivered at or prior to the authentication upon original issuance of the
Security of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature of an authorized officer, and
such certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder. Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 2.1, for all purposes of this Indenture such Security shall
be deemed never to have been authenticated and delivered hereunder and shall
never be entitled to the benefits of this Indenture.
SECTION 2.6.......Temporary Securities. Pending the preparation of definitive
Securities of any series, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
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denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers of the Company executing the
same may determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary Securities
of such series at the office or agency of the Company in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any series, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series of any authorized denominations and of
like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
SECTION 2.7.......Registration, Registration of Transfer and Exchange.
(a) General. The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office or in any other
office or agency of the Company in a Place of Payment being herein sometimes
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Securities and of transfers of Securities. The Trustee is hereby appointed
"Security Registrar" for the purpose of registering Securities and transfers of
Securities as herein provided.
Notwithstanding anything to the contrary set forth herein, the
Trustee shall not be required and shall have no obligation to monitor compliance
with any federal or state securities laws.
Upon surrender for registration of transfer of any Security of
a series at the office or agency of the Company in a Place of Payment for that
series, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount.
At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of like tenor and aggregate principal amount, upon surrender
of the Securities to be exchanged at such office or agency. Whenever any
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.
All Securities issued upon any registration of Transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer or for exchange shall be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed by the Holder thereof or his attorney duly authorized in
writing.
No service charge shall be made for any registration of
Transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 2.6, 7.5 or 9.7 not involving any transfer.
If the Securities of any series (or of any series and
specified tenor) are to be redeemed in part, the Company shall not be required
(A) to issue, register the Transfer of, or exchange, any Securities of that
series (or of that series and specified tenor, as the case may be) during a
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period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of any such Securities selected for redemption
under Section 9.3 and ending at the close of business on the day of such mailing
or (B) to register the Transfer of or exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part.
(b) Restricted Securities. Every Restricted Security shall be subject to the
restrictions on offers provided in the applicable legend(s) required to be set
forth on the face of each Restricted Security pursuant to Exhibit A and Section
2.2 or as provided pursuant to Section 2.3, unless such restrictions on transfer
shall be waived by the written consent of the Company, and the Holder of each
Restricted Security, by such Holder's acceptance thereof, agrees to be bound by
such restrictions on transfer. Whenever any Restricted Security is presented or
surrendered for registration of transfer or for exchange for a Security
registered in a name other than that of the Holder, such Restricted Security
must be accompanied by an appropriately completed certificate in substantially
the form set forth in or contemplated by Section 2.13(d) (which may be attached
to or set forth in the Restricted Security), appropriately completed, dated the
date of such surrender and signed by the Holder of such Restricted Security, as
to compliance with such restrictions on transfer, unless the Company shall have
notified the Trustee pursuant to this Section 2.7 that there is an effective
registration statement under the Securities Act with respect to such Restricted
Security. The Security Registrar shall not be required to accept for such
registration of transfer or exchange any Restricted Security not so accompanied
by a properly completed certificate.
Except as otherwise provided in the preceding paragraph or
pursuant to Section 2.3, if Securities are issued upon the transfer, exchange or
replacement of Securities bearing a legend or legends setting forth restrictions
on transfer, or if a request is made to remove such legend(s) on a Security, the
Securities so issued shall bear such legend(s) or such legend(s) shall not be
removed, as the case may be, unless the transferor delivers to the Company such
satisfactory evidence (which may include an opinion of independent counsel
experienced in matters of United States securities law as may be reasonably
satisfactory to the Company), as may be reasonably required by the Company, that
neither such legend(s) nor the restrictions on transfer set forth therein are
required to ensure that transfers thereof comply with the provisions of Rule
144A or Rule 144 or Regulation S under the Securities Act or that such
Securities are not "Restricted Securities" within the meaning of Rule 144 under
the Securities Act. Upon provision of such satisfactory evidence to the Company,
the Trustee, at the written direction of the Company set forth in an Officer's
Certificate, shall authenticate and deliver a Security that does not bear such
legend(s). In the absence of bad faith on its part, the Trustee may conclusively
rely upon such direction of the Company in authenticating and delivering a
Security that does not bear such legend(s).
Upon registration of Transfer of or exchange of Securities
that are no longer Restricted Securities, the Company shall execute, and the
Trustee shall authenticate and deliver, a Security that does not bear
restrictive legends.
As used in this Section 2.7(b), the term "Transfer"
encompasses any sale, pledge or other transfer of any Securities referred to
herein.
(c) Global Securities. Except as otherwise provided pursuant to Section 2.3,
this Section 2.7(c) shall apply to Global Securities.
(i) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depository designated for such Global Security or
a nominee thereof and delivered to such Depository or a nominee thereof or
custodian therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture. The Securities of each series may
be represented by one or more Global Securities, and such Global Securities may
be Restricted Global Securities, Temporary Regulation S Global Securities or
Regulation S Unrestricted Global Securities, or any combination thereof.
(ii) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
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transfer of a Global Security in whole or in part may be in the name of any
Person other than the Depository for such Global Security or a nominee thereof
unless (A) such Depository (1) has notified the Company that it is unwilling or
unable to continue as Depository for such Global Security or (2) has ceased to
be a clearing agency registered under the Exchange Act, and, in either case, a
successor Depository is not appointed within 90 days thereof, (B) the Company
executes and delivers to the Trustee a Company Order providing that such Global
Security shall be so transferable, registrable and exchangeable, (C) there shall
have occurred and be continuing an Event of Default with respect to the
Securities of such series or (D) there shall exist such circumstances if any, in
addition to or in lieu of the foregoing as have been specified for this purpose
by Section 2.3. Any Global Security exchanged pursuant to subclause (A) above
shall be so exchanged in whole and not in part and any Global Security exchanged
pursuant to subclause (B), (C) or (D) above may be exchanged in whole or from
time to time in part as directed by the Depository for such Global Security.
Notwithstanding any other provision in this Indenture, a Global Security to
which the restriction set forth in the second preceding sentence shall have
ceased to apply may be transferred only to, and may be registered and exchanged
for Securities registered only in the name or names of, such Person or Persons
as the Depository for such Global Security shall have directed and no transfer
thereof other than such a transfer may be registered.
(iii) Subject to clause (ii) above, any exchange of a Global Security for
other Securities may be made in whole or in part, and all Securities issued in
exchange for a Global Security or any portion thereof shall be registered in
such name or names as the Depository for such Global Security shall direct.
(iv) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Section 2.7, Section 2.6, 2.9 or 9.7 or
otherwise shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depository for such Global Security or a nominee thereof.
(v) Except as otherwise provided pursuant to Section 2.3, notwithstanding
any other provision of this Indenture or of the Securities, transfers of
interests in a Global Security of the kind described in Section 2.1 and in
subclauses (B), (C), (D) and (E) of this clause (v) below shall be made only in
accordance with this clause (v), and all transfers of an interest in a Temporary
Regulation S Global Security shall comply with subclause (G) of this clause (v).
The provisions of this clause (v) providing for transfers of Securities of a
series or beneficial interests in Global Securities of such series to Persons
who wish to take delivery in the form of beneficial interests in a Restricted
Global Security, Temporary Regulation S Global Security or Regulation S
Unrestricted Global Security shall only apply if there is a Restricted Global
Security, Temporary Regulation S Global Security or Regulation S Unrestricted
Global Security, as the case may be, for such series.
(A) Transfer of Global Security. A Global Security may not be transferred,
in whole or in part to any Person other than the Depository or a nominee
thereof, and no such transfer to any such other Person may be registered;
provided that this subclause (A) shall not prohibit any transfer of a Security
that is issued in exchange for a Global Security but is not itself a Global
Security. No transfer of a Security to any Person shall be effective under this
Indenture or the Securities unless and until such Security has been registered
in the name of such Person. Nothing in this Section 2.7 shall prohibit or render
ineffective any transfer of a beneficial interest in a Global Security effected
in accordance with the other provisions of this Section 2.7(c)(v).
(B) Restricted Global Security to Regulation S Global Security. If the
holder of a beneficial interest in a Restricted Global Security wishes at any
time to transfer such interest to a person who wishes to take delivery thereof
in the form of a beneficial interest in a Regulation S Global Security, such
transfer may be effected, subject to the rules and procedures of the Depository
for such Global Security, Euroclear and Clearstream, in each case to the extent
applicable (the "Applicable Procedures"), only in accordance with the provisions
of this Section 2.7(c)(v)(B). Upon receipt by the Trustee, as Security
Registrar, at the Corporate Trust Office of (1) written instructions given in
accordance with the Applicable Procedures from a member of, or participant in,
the Depository for such Global Security (each, an "Agent Member") directing the
Page 31
Trustee to credit or cause to be credited to a specified Agent Member's account
a beneficial interest in a Regulation S Global Security in a principal amount
equal to that of the beneficial interest in the Restricted Global Security to be
so transferred, (2) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the Agent Member (and
the Euroclear or Clearstream account, as the case may be) to be credited with,
and the account of the Agent Member to be debited for, such beneficial interest
and (3) an appropriately completed certificate in substantially the form set
forth in or contemplated by Section 2.13(a) given by the holder of such
beneficial interest, the Trustee, as Security Registrar, shall instruct the
Depository for such Securities to reduce the principal amount of the Restricted
Global Security, and to increase the principal amount of the Regulation S Global
Security, by the principal amount of the beneficial interest in the Restricted
Global Security to be so transferred, and to credit or cause to be credited to
the account of the Person specified in such instructions (which shall be the
Agent Member for Euroclear or Clearstream or both, as the case may be) a
beneficial interest in the Regulation S Global Security having a principal
amount equal to the amount by which the principal amount of the Restricted
Global Security was reduced upon such transfer.
(C) [Intentionally Omitted]
(D) Regulation S Global Security to Restricted Global Security. If the
holder of a beneficial interest in a Regulation S Global Security wishes at any
time to transfer such interest to a Person who wishes to take delivery thereof
in the form of a beneficial interest in a Restricted Global Security, such
transfer may be effected, subject to the Applicable Procedures, only in
accordance with this Section 2.7(c)(v)(D). Upon receipt by the Trustee, as
Security Registrar, at the Corporate Trust Office of (1) written instructions
given in accordance with the Applicable Procedures from an Agent Member
directing the Trustee, as Security Registrar, to credit or cause to be credited
to a specified Agent Member's account a beneficial interest in the Restricted
Global Security equal to that of the beneficial interest in the Regulation S
Global Security to be so transferred, (2) a written order given in accordance
with the Applicable Procedures containing information regarding the account of
the Agent Member to be credited with, and the account of the Agent Member (or,
if such account is held for Euroclear or Clearstream, the Euroclear or
Clearstream account, as the case may be) to be debited for, such beneficial
interest and (3) with respect to a transfer of a beneficial interest in the
Regulation S Global Security, an appropriately completed certificate in
substantially the form set forth in or contemplated by Section 2.13(c) given by
the holder of such beneficial interest, the Trustee, as Security Registrar,
shall instruct the Depository for such Securities to reduce the principal amount
of the Regulation S Global Security and to increase the principal amount of the
Restricted Global Security, by the principal amount of the beneficial interest
in the Regulation S Global Security to be so transferred, and to credit or cause
to be credited to the account of the Person specified in such instructions a
beneficial interest in the Restricted Global Security having a principal amount
equal to the amount by which the principal amount of the Regulation S Global
Security was reduced upon such transfer.
(E) Restricted Security (other than a Restricted Global Security) to Global
Security. If the Holder of a Restricted Security (other than a Restricted Global
Security) wishes at any time to transfer such Security to a Person who wishes to
take delivery thereof in the form of a beneficial interest in a Restricted
Global Security or an Unrestricted Global Security, such transfer may be
effected, subject to the Applicable Procedures, only in accordance with this
Section 2.7(c)(v)(E). Upon receipt by the Trustee, as Security Registrar, at the
Corporate Trust Office of (1) the Restricted Security to be transferred, (2)
written instructions given in accordance with the Applicable Procedures from an
Agent Member directing the Trustee to credit or cause to be credited to a
specified Agent Member's account a beneficial interest in the Restricted Global
Security or the Unrestricted Global Security, as the case may be, in a principal
amount equal to the principal amount of the Restricted Security to be so
transferred (3) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the Agent Member
(and, in the case of any Transfer pursuant to Regulation S, the Euroclear or
Clearstream account for which such Agent Member's account is held or, if such
account is held for Euroclear or Clearstream, the Euroclear or Clearstream
account, as the case may be) to be credited with such beneficial interest and
Page 32
(4) an appropriately completed certificate in substantially the form set forth
in or contemplated by Section 2.13(d) (which may be attached to or set forth in
the Restricted Security), the Trustee, as Security Registrar, shall cancel the
Restricted Security, the Company shall execute, and the Trustee shall
authenticate and deliver, a new definitive Security for the principal amount, if
any, of the Restricted Security not so transferred, registered in the name of
the Holder transferring such Restricted Security, and the Trustee shall instruct
the Depository for such Securities to increase the principal amount of the
Restricted Global Security or the Unrestricted Global Security, as the case may
be, by the principal amount of the Restricted Security so transferred, and to
credit or cause to be credited to the account of the Person specified in such
instructions (which, in the case of any increase of the principal amount of an
Unrestricted Global Security as the result of a Transfer pursuant to Regulation
S, shall be the Agent Member for Euroclear or Clearstream or both, as the case
may be) a corresponding principal amount of the Restricted Global Security or
the Unrestricted Global Security. The transfer of a Restricted Security to a
Person who wishes to take delivery thereof in the form of a beneficial interest
in a Global Security other than a Restricted Global Security may be effected
only in accordance with Regulation S or Rule 144A under the Securities Act (as
evidenced by the certificate delivered pursuant to Section 2.13(d)).
(F) Other Exchanges. In the event that a Global Security or any portion
thereof is exchanged for Securities other than Global Securities, the Trustee,
as Security Registrar, shall instruct the Depository for the Global Security to
reduce the principal amount of the Global Security by the principal amount of
the Securities other than Global Securities issued upon such exchange. Such
other Securities may in turn be exchanged (on transfer or otherwise) for
beneficial interests in a Global Security (if any are then outstanding) only in
accordance with such procedures, which shall be substantially consistent with
the provisions of subclauses (A) through (E) above (including the certification
requirements intended to insure that transfers of beneficial interests in a
Global Security comply with Rule 144A, Rule 144 or Regulation S under the
Securities Act, as the case may be) and any other procedures as may be from time
to time adopted by the Company and the Trustee.
(G) Interests in Temporary Regulation S Global Security to be Held Through
Euroclear or Clearstream. Until the termination of the Restricted Period with
respect to Securities of a series, interests in any Temporary Regulation S
Global Security of such series may be held only through Agent Members acting for
and on behalf of Euroclear and Clearstream, provided that this subclause (G)
shall not prohibit any transfer in accordance with subclause (D) of this Section
2.7(c)(v).
SECTION 2.8.......Mutilated, Destroyed, Lost and Stolen Securities. If any
mutilated Security is surrendered to the Trustee, the Company shall execute and,
upon the Company's request, the Trustee shall authenticate and deliver a new
definitive Security, of like tenor and aggregate principal amount and equal face
amount of principal, registered in the same manner, dated the date of its
authentication and bearing interest from the date to which interest has been
paid on such Security, in exchange and substitution for such Security (upon
surrender and cancellation thereof); provided, that the applicant for such new
Security shall furnish to the Company and to the Trustee such reasonable
security or indemnity as may be required by them to save each of them harmless.
If there shall be delivered to the Company and the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (b) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and, upon the Company's request, the
Trustee shall authenticate and deliver a new definitive Security, of like tenor
and aggregate principal amount and equal face amount of principal registered in
the same manner, dated the date of its authentication and bearing interest from
the date to which interest has been paid on such Security, in lieu of and
substitution for such Security.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security (without surrender
thereof, except in the case of a mutilated Security) if the applicant for such
Page 33
payment shall furnish to the Company and the Trustee such reasonable security or
indemnity as they may require to save each of them harmless, and in case of
destruction, loss or theft, evidence to the satisfaction of the Company and the
Trustee of the destruction, loss or theft of such Security.
Upon the issuance of any new Security under this Section 2.8,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this
Section 2.8 in lieu of any destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.
The provisions of this Section 2.8 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.9.......Payments; Interest Rights Preserved. Except as otherwise
provided as contemplated by Section 2.3 with respect to any series of
Securities, interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest.
Any interest on any Security of any series which is payable;
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be set in
the following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Security of such series
and the date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this clause (a)
provided. Thereupon, the Company shall fix a Special Record Date for the payment
of such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than 10 days
after the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly, in the name and at the expense of the Company, cause
notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor to be given to each Holder of Securities of such series in the
manner set forth in Section 1.6, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Securities of such series (or
their respective Predecessor Securities) are registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to the
following clause (b).
(b) The Company may make payment of any Defaulted Interest on the Securities of
any series in any other lawful manner not inconsistent with the requirements of
any securities exchange on which such Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause (b), such
manner of payment shall be deemed practicable by the Trustee.
Page 34
Subject to the foregoing provisions of this Section 2.9, each
Security delivered under this Indenture upon registration of transfer of, or in
exchange for, or in lieu of, any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Except as otherwise specified as contemplated by Section 2.3
for the Securities of any series, all payments of principal, premium, if any,
and interest on Securities of such series will be made by check drawn on a bank
in The City of New York or, for a Holder of at least $1,000,000 in initial
aggregate principal amount of Securities of such series, by wire transfer to an
account maintained by the payee with a bank in The City of New York, provided
that a written request from such Holder to such effect designating such account
is received by the Trustee no later than the thirtieth day immediately preceding
the date of payment. Unless such designation is revoked in writing, any
designation made by such Holder with respect to such Securities will remain in
effect with respect to any future payments with respect to such Securities
payable to such Holder. The Company will indemnify and hold the Trustee harmless
against any loss, liability or expense (including attorneys' fees) resulting
from any act or omission to act on the part of the Trustee or any such Holder in
connection with any such designation or which the Paying Agent or Trustee may
incur as a result of making any payment in accordance with any such designation.
Except as otherwise specified as contemplated by Section 2.3,
all payments of principal and premium, if any, on the Securities of any series
(other than installments of principal due with respect to Installment Securities
prior to the Maturity thereof) shall be made upon presentation and surrender
thereof at the office or agency of the Company maintained for such purpose in
the Borough of Manhattan, The City of New York.
SECTION 2.10......Persons Deemed Owners. Prior to due presentment of a Security
for registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee shall treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment of
principal of and any premium and (subject to Section 2.9) any interest on such
Security and for all other purposes whatsoever, whether or not such Security be
overdue, and neither the Company, the Trustee nor any agent of the Company or
the Trustee shall be affected by notice to the contrary.
SECTION 2.11......Cancellation. All Securities surrendered for payment,
redemption, registration of transfer or exchange, or for credit against any
sinking fund payment shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee (or to any
other Person for delivery to the Trustee for cancellation) any Securities
previously authenticated hereunder which the Company has not issued and sold,
and all Securities so delivered shall be promptly canceled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as provided in this Section 2.11, except as expressly permitted by this
Indenture. All canceled Securities held by the Trustee shall be disposed of as
directed by a Company Order.
SECTION 2.12......Computation of Interest. Except as otherwise specified as
contemplated by Section 2.3 for Securities of any series, interest on the
Securities of each series shall be computed on the basis of a 360-day year of
twelve 30-day months.
SECTION 2.13......Certification Forms.
(a) Except as otherwise specified as contemplated by Section 2.3 for the
Securities of any series, whenever any certification is to be given by a
beneficial owner of a portion of a Restricted Global Security pursuant to
Section 2.7(c)(v)(B) in connection with the initial transfer of a beneficial
interest in a Restricted Global Security to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Regulation S Global Security,
such certification shall be provided substantially in the form set forth in
Exhibit B hereto, with only such changes as shall be approved in writing by the
Company and the lead underwriters or purchasers, if any, of the initial offering
of such Securities being transferred.
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(b) Intentionally Omitted.
(c) Except as otherwise specified as contemplated by Section 2.3 for the
Securities of any series, whenever any certification is to be given by a
beneficial owner of a portion of a Regulation S Global Security pursuant to
Section 2.7(c)(v)(D) in connection with the initial transfer of a beneficial
interest in the Regulation S Global Security to a Person who wishes to take
delivery thereof in the form of a beneficial interest in the Restricted Global
Security, such certification shall be provided substantially in the form set
forth in Exhibit C hereto, with only such changes as may be approved in writing
by the Company and the lead underwriters or purchasers, if any, of the initial
offering of such Securities being transferred.
(d) Except as otherwise specified as contemplated by Section 2.3 for the
Securities of any series, whenever any certification is to be given by a
beneficial owner of a Restricted Security pursuant to Section 2.7(b) or
2.7(c)(v)(E) in connection with the transfer or exchange of a Restricted
Security, such certification shall be provided substantially in the form set
forth in Exhibit D (which may be attached to or set forth on the Restricted
Security), with only such changes as may be approved in writing by the Company
and the lead underwriters or purchasers, if any, of the initial offering of such
Securities being transferred.
SECTION 2.14......CUSIP Numbers. The Company in issuing the Securities may use
"CUSIP" or"ISIN" numbers (if then generally in use), and, if so, the Trustee
shall use "CUSIP" or "ISIN" numbers in notices of redemption as a convenience to
Holders; provided that the Trustee shall assume no responsibility for the
accuracy of such numbers and any such redemption shall not be affected by any
defect in or omission of such numbers.
ARTICLE 3
SATISFACTION AND DISCHARGE
SECTION 3.1.......Satisfaction and Discharge of Indenture. This Indenture shall
upon Company Request cease to be of further effect (except as to any surviving
rights of registration of transfer or exchange of Securities herein expressly
provided for), and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when:
(a) either:
(i) all Securities theretofore authenticated and delivered (other
than (A) Securities which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section
2.8 and (B) Securities for whose payment money has theretofore
been deposited in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 8.4) have been
delivered to the Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee
for cancellation
(1) have become due and payable, or
(2) will become due and payable at their Stated Maturity within
one year, or
(3) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
irrevocable notice of redemption by the Trustee in the name,
and at the expense of the Company,
and the Company, in the case of (1), (2) or (3) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the
purpose of making the following payments, specifically pledged as
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security for and dedicated solely to, the benefits of the Holders of
such Securities, money in an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the
Trustee for cancellation, for principal and any premium and interest to
the date of such deposit (in the case of Securities which have become
due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(b) the Company has paid or caused to be paid all other sums payable hereunder
by the Company, and
(c) the Company has delivered to the Trustee an Officer's Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company and the Partnership (through Section
12.1) to the Trustee under Section 5.7 and, if money shall have been deposited
with the Trustee pursuant to subclause (ii) of clause (A) of this Section, the
obligations of the Trustee under Section 3.2 and the last paragraph of Section
8.4 shall survive.
The provisions of Section 11.6 shall apply to this Section 3.1
as if set forth herein.
SECTION 3.2.......Application of Trust Money. Subject to the provisions of the
last paragraph of Section 8.4, all money deposited with the Trustee pursuant to
Section 3.1 shall be held in trust and applied by it, in accordance with the
provisions of the Securities and this Indenture, to the payment, either directly
or through any Paying Agent (including the Company acting as its own Paying
Agent), to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE 4
REMEDIES
SECTION 4.1.......Events of Default. "Event of Default," wherever used herein
with respect to Securities of any series, means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
or order of any court or any order, rule or regulation of any administrative or
governmental body):
(a) the Company shall fail to pay (i) any principal or premium, if any, on
any Security when the same becomes due and payable, whether at stated
maturity or required prepayment or by acceleration or otherwise and
such failure shall continue for a period of more than 5 days or (ii)
any interest on any Security when the same becomes due and payable,
whether at stated maturity or required prepayment or by acceleration or
otherwise and such failure shall continue for a period of more than 15
days; or
(b) either Obligor shall fail to preserve and maintain its legal existence
(except as permitted in Article 8); or
(c) either Obligor shall fail to deposit any sinking fund payment, when and
as due by the terms of a Security of that series; or
(d) any representation, warranty or certification made herein or in any
other Basic Agreement (or in any modification or supplement hereto or
thereto) by either Obligor or any other Relevant Party, or in any
certificate furnished to the Trustee or the Collateral Agent pursuant
to the provisions hereof or thereof, shall prove to have been false as
of the time made or furnished in any material respect and such
misrepresentation has resulted in a Material Adverse Effect and shall
continue uncured for 30 or more days; or
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(e) any Relevant Party shall fail to perform or observe any of its
obligations or covenants contained herein or in any other Basic
Agreement (or in any modification or supplement hereto or thereto)
(other than an obligation or covenant, a default in which is otherwise
expressly included in this Section 4.1), and such failure has resulted
in a Material Adverse Effect and shall continue uncured for 30 or more
days; or
(f) (i) the Partnership shall default in the payment when due of any
principal of or interest on any of its other Indebtedness aggregating
at least the greater of (x) $20,000,000, as Escalated, or more and (y)
5% of the Partnership's aggregate outstanding Indebtedness, (ii) the
Company shall default in the payment when due of any principal of or
interest on any of its other Indebtedness or (iii) the Partnership or
the Company shall default in the payment when due of any secured debt
secured equally and ratably with the Securities; or any event specified
in any note, agreement, indenture or other document evidencing or
relating to any such Indebtedness shall occur if the effect of such
event is to cause, or (with the giving of any notice or the lapse of
time or both) to permit the holder or holders of such Indebtedness (or
a trustee or agent on behalf of such holder or holders) to cause, such
Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its
stated maturity and such event is not cured or waived within 30 days
after the date of its occurrence or such Indebtedness is accelerated
prior to the end of such 30-day period.
(g) the Partnership, the Company or any other Relevant Party shall admit in
writing its inability to, or be generally unable to, pay its debts as
such debts become due; or
(h) the Partnership, the Company or any other Relevant Party shall (i)
apply for or consent to the appointment of, or the taking of possession
by, a receiver, custodian, trustee, examiner or liquidator of itself or
of all or a substantial part of its Property, (ii) make a general
assignment for the benefit of its creditors, (iii) commence a voluntary
case under the Bankruptcy Code, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency,
reorganization, liquidation, dissolution, arrangement or winding-up, or
composition or readjustment of debts, (v) fail to controvert in a
timely and appropriate manner, or acquiesce in writing to, any petition
filed against it in an involuntary case under the Bankruptcy Code or
(vi) take any corporate action authorizing any of the foregoing; or
(i) a proceeding or case shall be commenced without the application or
consent of the affected Relevant Party, in any court of competent
jurisdiction, seeking (x) its reorganization, liquidation, dissolution,
arrangement or winding-up, or the composition or readjustment of its
debts, (y) the appointment of a receiver, custodian, examiner,
liquidator or the like of such Relevant Party or of all or any
substantial part of its Property or (z) similar relief in respect of
such Relevant Party under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and
such proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of 60 or more
consecutive days;
(j) a final judgment or judgments for the payment of money, in the
aggregate, in excess of the greater of (x) $20,000,000, as Escalated,
and (y) 5% of the Gross Book Value of the Partnership, shall be
rendered by one or more courts, administrative tribunals or other
bodies having jurisdiction against the Partnership or the Company and
the same shall not be discharged (or provision shall not be made for
such discharges or a stay of execution thereof shall not be procured),
within 60 days from the date of entry thereof and such Obligor shall
not, within said period of 60 days, or such longer period during which
execution of the same shall have been stayed, appeal therefrom and
cause the execution thereof to be stayed during such appeal; or
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(k) one or more of the Basic Agreements (other than the Indenture) shall
fail to be in full force and effect (unless such failure is the result
of a termination of such Basic Agreement in accordance with its terms
(other than a termination due to a default by a party to such Basic
Agreement) and such failure continues for more than 30 days (provided
that, if efforts to cure such default have been commenced within such
30-day period, such cure period shall be extended for an additional 30
days so long as no other Event of Default shall occur and be continuing
and the Partnership, or the Company, as applicable, is diligently
pursuing such cure) unless immediately after giving effect to such
failure to be in full force and effect there shall be No Ratings
Downgrade; or
(l) If:
(i) any party (other than the Partnership) to a Project Agreement (other
than an LTFT Agreement or a Shipper Guaranty) shall default in the
performance of any term, covenant or agreement contained in such
Project Agreement, (and such default shall continue uncured for the
length of the applicable cure period set forth in such Project
Agreement or a Shipper Guaranty), and such party shall not have been
replaced within 90 days of such default with a Person capable of
performing such term, covenant or agreement; or
(ii) any Project Agreement (other than an LTFT Agreement) shall become
invalid, illegal or unenforceable, or shall cease, for any reason, to
be in full force and effect in all material respects, and such Project
Agreement shall not have been replaced within 90 days of such
cessation;
and, in either case, the failure to make such replacement could reasonably be
expected to result in a Material Adverse Effect; or
(m) any of the Liens created by the Security Agreements shall at any time not
constitute a valid and perfected Lien on the collateral intended to be covered
thereby (to the extent perfection by filing, registration, recordation or
possession is required herein or therein) in favor of the Collateral Agent free
and clear of all other Liens (other than Liens permitted under Section 8.8), or,
except for expiration in accordance with its terms, any of the Security
Agreements shall for whatever reason be terminated or cease to be in full force
and effect, or the enforceability thereof shall be contested by either Obligor
and any such event shall remain uncured for a period of 15 days; or
(n) the Company shall cease to be a wholly owned Subsidiary of the Partnership;
or
(o) any other Event of Default provided with respect to Securities of that
series.
Any Partner shall have the right, but not the obligation, to
cure any payment default in clauses (a), (e), (f) or (j) above, including the
Partnership's payment obligations under Article 12 herein, within the respective
grace period set forth in such clauses and, if such payment default is cured,
such payment default shall not constitute an Event of Default under this
Indenture.
SECTION 4.2.......Acceleration of Maturity; Rescission and Annulment. If an
Event of Default (other than an Event of Default specified in Section 4.1(g),
(h) or (i)) with respect to Securities of any series at the time Outstanding
occurs and is continuing, then in every such case the Trustee or the Holders of
not less than 25% in Principal Amount of the Outstanding Securities of that
series may declare the unpaid Principal Amount (including any premium) of all
the Securities of that series (or, if any Securities of that series are Original
Issue Discount Securities, such portion of the Principal Amount (and premium) of
such Securities as may be specified by the terms thereof) to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee, if given
by Holders), and upon any such declaration such Principal Amount (and premium)
shall become immediately due and payable. If an Event of Default specified in
Section 4.1(g), (h) or (i) with respect to Securities of any series at the time
Outstanding occurs, the principal amount of all the Securities of that series
(or, if any Securities of that series are Original Issue Discount Securities,
Page 39
such portion of the principal amount of such Securities as may be specified by
the terms thereof) shall automatically, and without any declaration or other
action on the part of the Trustee or any Holder, become immediately due and
payable. In either such case, the Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Securities may then send a Default Notice
pursuant to the Collateral Agency Agreement requesting the Collateral Agent to
take action against the Collateral. Such request is subject to approval by the
Required Senior Parties.
At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article 4 provided, the Holders of a majority in Principal
Amount of the Outstanding Securities of that series, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if:
(a) there has been paid or deposited with the Trustee a sum sufficient to pay
the aggregate of:
(i) all overdue interest on all Securities of that series,
(ii) the principal of (and premium, if any, on) any Securities of that
series which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates prescribed
therefor in such Securities,
(iii) to the extent that payment of such interest is lawful, interest upon
overdue interest at the rate or rates prescribed therefor in such
Securities, and
(iv) all sums paid by the Trustee hereunder and the reasonable compensation,
expenses and disbursements of the Trustee, its agents and counsel;
and
(b) all Events of Default with respect to Securities of that series, other than
the non-payment of the principal of Securities of that series which have become
due solely by such declaration of acceleration, have been cured or waived as
provided in Section 4.13.
No such rescission shall affect any subsequent default or
impair any right consequent thereon.
SECTION 4.3.......Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that if:
(a) default is made in the payment of any interest on any Security when such
interest becomes due and payable and such default continues for a period of 15
days and such default is not cured by any Partner pursuant to Section 4.1(a), or
(b) default is made in the payment of the principal of (or premium, if any, on)
any Security at the Maturity thereof and such default continues for a period of
5 days and such default is not cured by any Partner pursuant to Section 4.1(a),
then the Company will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Security the whole amount then due and payable on
such Securities for principal and any premium and interest and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal and premium and on any overdue interest (if any), at the rate
or rates prescribed therefor in such Securities, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses and disbursements of
the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any other obligor upon such Securities
Page 40
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such
Securities, wherever situated, subject to the Collateral Agency Agreement.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may, subject to Section 4.12, in
its discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities of such series by such appropriate judicial proceedings as
the Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 4.4.......Trustee May File Proofs of Claim. In case of any judicial
proceeding relative to the Company or the Partnership (or any other obligor upon
the Securities), its property or its creditors, the Trustee shall be entitled
and empowered, by intervention in such proceeding or otherwise, to file and
prove a claim for the whole amount of principal, premium, if any, and any
interest owing and unpaid in respect of the Securities and to file such 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
and disbursements of the Trustee, its agents and counsel) and of the Holders
allowed in any such judicial proceeding. In particular, the Trustee shall be
authorized to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
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 it for the reasonable compensation, expenses and disbursements of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 5.7.
No provision of this Indenture shall be deemed to authorize
the Trustee (x) to authorize, consent to, accept, or adopt on behalf of any
Holder, any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to (y) 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 be a member of a creditors' or
other similar committee.
SECTION 4.5.......Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses and disbursements of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Securities in respect of which such judgment has been recovered.
SECTION 4.6.......Application of Money Collected. Any money collected by the
Trustee pursuant to this Article 4 or the Collateral Agency Agreement shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal or any premium
or interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST, to the payment of all amounts due the Trustee under
Section 5.7;
SECOND, to the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect
of which or for the benefit of which such money has been collected
ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal and any
premium and interest, respectively; and
THIRD, if any such money shall remain after the distributions
set forth in priorities FIRST and SECOND, to the Company.
Page 41
SECTION 4.7.......Limitation on Suits. No Holder of any Security of any series
shall have any right to institute any proceeding, judicial or otherwise, with
respect to the Securities of such series or this Indenture, or for the
appointment of a receiver or for any other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(b) the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series shall have made a written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(d) the Trustee for 60 days after its receipt of such notice, request and offer
of indemnity has failed to institute any such proceeding; and
(e) no written direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
Principal Amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 4.8.......Unconditional Right of Holders to Receive Principal, Premium
and Interest. Notwithstanding any other provision in this Indenture, the Holder
of any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of, premium, if any, and (subject to Section
2.9) interest on such Security on the respective Stated Maturities expressed in
such Security (or, in the case of redemption, on the Redemption Date) and to
institute suit for the enforcement of any such payment, and such rights shall
not be impaired without the consent of such Holder.
SECTION 4.9.......Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then and in
every such case, subject to any determination in such proceeding, the Company,
the Partnership, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 4.10......Rights and Remedies Cumulative. Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities in the last paragraph of Section 2.8 and subject to Section
4.7, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 4.11......Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder of any Securities to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article 4 or by law to the Trustee or to
the Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
Page 42
SECTION 4.12......Control by Holders. The Holders of a majority in principal
amount of the Outstanding Securities of any series shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Securities of such series, provided that
(a) such direction shall not be in conflict with any rule of law or with this
Indenture, and would not involve the Trustee in personal liability.
(b) the Trustee may take any other action deemed proper by the Trustee which is
not inconsistent with such direction, provided, further, that, any trust or
power conferred on the Trustee in its capacity as representative of the Holders
as Partnership Senior Parties or Funding Senior Parties (as such terms are
defined in the Collateral Agency Agreement), shall be exercisable at the
direction of the Holders in accordance with Section 5.13 and not in accordance
with this Section 4.12.
SECTION 4.13......Waiver of Past Defaults. The Holders of not less than a
majority in principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series waive any past
default hereunder with respect to such series and its consequences, except a
default:
(a) in the payment of the principal of, premium, if any, or interest on any
Security of such series; or
(b) in respect of a covenant or provision hereof which under Article 7 cannot be
modified or amended without the consent of the Holder of each Outstanding
Security of such series affected.
Upon any such waiver, such default shall cease to exist, the
Company, the Partnership, the Trustee and the Holders of the Securities of that
series shall be restored to their former positions and rights hereunder, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 4.14......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, suffered or omitted by it as Trustee, a court may require any
party litigant in such suit to file an undertaking to pay the costs of such
suit, and may assess costs against any such party litigant, having due regard to
the merits and good faith of the claims or default made by such party litigant;
provided, that the provisions of this Section 4.14 shall not apply to any suit
instituted by the Trustee or to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Securities of any series, or to any suit instituted by any Holder of
any Security for the enforcement of the payment of the principal of, premium, if
any, or interest on such Security on or after the Stated Maturity thereof
(including, in the case of redemption, on or after the Redemption Date).
SECTION 4.15......Waiver of Usury, Stay or Extension Laws. Each Obligor
covenants (to the extent that each may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any usury, stay or extension law wherever enacted, now
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture or any obligations arising under the Securities of
any series issued hereunder, and each Obligor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
SECTION 4.16......Securities Held by Certain Persons Not to Share in
Distribution. Any Securities known to a Responsible Officer of the Trustee
assigned to its Institutional Trust Services department (or any successor
department or group) to be owned or held by, or for the account or benefit of,
the Company or the Partnership or an Affiliate of either thereof shall not be
Page 43
entitled to share in any payment or distribution provided for in this Article 4
until all Securities held by other Persons have been indefeasibly paid in full.
SECTION 4.17......The Collateral Agency Agreement. Simultaneously with the
execution and delivery of this Indenture, the Trustee shall enter into the
Collateral Agency Agreement. All rights and remedies available to the Trustee
and the Holders of the Outstanding Securities, and all future Holders of any of
the Securities, with respect to the Collateral, or otherwise pursuant to the
Security Agreements, shall be subject to the Collateral Agency Agreement.
ARTICLE 5
THE TRUSTEE
SECTION 5.1.......Certain Duties and Responsibilities.
(a) Except during a continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture and the Collateral Agency
Agreement, and no implied covenants or obligations shall be read into
this Indenture and the Collateral Agency Agreement 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 certificates, requests, orders or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture and the Collateral Agency Agreement, as applicable; but
in the case of any such certificates or opinions which by any provision
hereof or of the Collateral Agency Agreement are specifically required
to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the
requirements of this Indenture, but need not verify the contents
thereof.
(b) In case 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 the Collateral Agency Agreement, and use the same degree
of care and skill in their exercise, as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act or its own wilful misconduct, except that:
(i) this clause (c) shall not be construed to limit the effect of clause
(a) of this Section 5.1;
(ii) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in Principal Amount (or such
other amount as may be provided in or pursuant to this Indenture) of
the Outstanding Securities of any series relating to the time, method
and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred upon the Trustee
under this Indenture or the Collateral Agency Agreement; and
(iv) no provision of this Indenture or the Collateral Agency Agreement shall
require the Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured to it (including, without limitation, adequate
indemnity reasonably satisfactory to the Trustee against any
Page 44
environmental liabilities against the Trustee arising out of the
performance of its duties hereunder and under the Collateral Agency
Agreement).
(d) Whether or not therein expressly so provided, every provision of this
Indenture or the Collateral Agency Agreement relating to the conduct or
affecting the liability of or affording protection to the Trustee shall
be subject to the provisions of this Section 5.1.
SECTION 5.2.......Notice of Defaults. Within 90 days after the occurrence of any
default hereunder, the Trustee shall transmit by mail to all Holders, as their
names and addresses appear in the Security Register, notice of such default
hereunder known to the Trustee, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of or interest on any Security, the Trustee shall be protected
in withholding such notice if and so long as a Responsible Officer of the
Trustee in good faith determines that the withholding of such notice is in the
best interests of the Holders. For the purpose of this Section 5.2, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an Event of Default.
SECTION 5.3.......Certain Rights of Trustee. Subject to the provisions of
Section 5.1:
(a) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Company or the Partnership mentioned herein
shall be sufficiently evidenced by an Officer's Certificate, or, in the case of
the Company, a Company Request or Company Order;
(c) whenever in the administration of this Indenture or the Collateral Agency
Agreement the Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting to take any action hereunder
or under the Collateral Agency Agreement, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officer's Certificate;
(d) 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 in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture or the Collateral Agency Agreement at the
request or direction of any of the Holders pursuant to this Indenture or the
Collateral Agency Agreement, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(f) the Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent order, bond, debenture, note, other
evidence of indebtedness or other paper or document, but the Trustee in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company or the Partnership, as applicable,
personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers hereunder or perform any
duties hereunder or under the Collateral Agency Agreement either directly or by
or through agents or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed with due
care by it hereunder.
Page 45
SECTION 5.4.......Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company
or the Partnership, as applicable, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or the Securities or any Collateral or Lien thereon or any Security
Agreement. Neither the Trustee nor any Authenticating Agent shall be accountable
for the use or application by the Company of Securities or the proceeds thereof.
The Trustee shall not be charged with knowledge of any Default or Event of
Default unless a Responsible Officer of the Trustee assigned to its
Institutional Trust Services department (or any successor department or group)
shall have actual knowledge thereof or shall have received written notice
thereof in accordance with Section 1.5 from the Company, the Partnership, the
Collateral Agent or any Holder. The Trustee shall not be responsible for
perfecting or maintaining the perfection of the Lien on the Collateral or for
filing, refiling or recording any document, notice or instrument in any public
office at any time. The Trustee shall not be responsible for calculating the
Economic Make-Whole Premium. The Trustee makes no representations as to the
value or condition of the Collateral or any part thereof, or as to the title of
the Partnership or the Company thereto or as to the security afforded by the
Security Agreements, or as to the validity, execution (except its own
execution), enforceability, priority, perfection, legality or sufficiency of the
Security Agreements or any Senior Debt Agreement, and the Trustee shall incur no
liability or responsibility in respect of any such matters. The Trustee shall
not be responsible for insuring the Collateral or any other Property or for
determining whether the Collateral or any other Property is properly insured or
for the payment of taxes, charges, assessments or liens upon the Collateral or
otherwise as to the maintenance of the Collateral.
SECTION 5.5.......May Hold Securities. The Trustee, any Authenticating Agent,
any Paying Agent, any Security Registrar or any other agent of the Company or
the Partnership, in its individual or any other capacity, may become the owner
or pledgee of Securities and may otherwise deal with the Company and the
Partnership with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Security Registrar or such other agent.
SECTION 5.6.......Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the Company.
SECTION 5.7.......Compensation and Reimbursement. The Company agrees:
(a) to pay to the Trustee (all references in this Section 5.7 to the Trustee
shall be deemed to apply to the Trustee in its capacities as Trustee, Paying
Agent and Securities Registrar) from time to time such compensation as shall be
agreed to in writing for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein or in any written agreement
between the Trustee and the Company, to reimburse the Trustee upon its request
for all reasonable and documented (in accordance with the standard practices of
the Trustee) expenses and disbursements incurred or made by the Trustee in
accordance with any provision of this Indenture or the Collateral Agency
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense or
disbursement as may be attributable to its negligence or bad faith;
(c) to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder or in connection with the Securities of any series,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder or under the Collateral Agency Agreement; and
(d) the obligations of the Company under this Section 5.7 to compensate the
Trustee, to pay or reimburse the Trustee for expenses and disbursements and to
Page 46
indemnify and hold harmless the Trustee shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this Indenture.
Without prejudice to any other rights available to the Trustee
under applicable law, when the Trustee incurs expenses or renders services after
the occurrence of an Event of Default under Section 4.1(g), (h) or (i), the
parties hereto and the Holders by their acceptance of the Securities hereby
agree that the expenses and the compensation for the services of the Trustee are
intended to constitute expenses of administration under any applicable
bankruptcy law.
If the Trustee (or an agent thereof) takes title to the assets
of the Company or the Partnership pursuant to a foreclosure proceeding (as used
in this Section 5.7(d), a "Transfer"), then the Company and the Partnership will
indemnify the Trustee for liabilities arising out of any violation of
environmental law by the Company or the Partnership, as the case may be, whether
known at the time of the Transfer or discovered subsequent to the Transfer, with
respect to such assets that resulted from action occurring prior to the
Transfer. The foregoing indemnity shall be for the sole benefit of the Trustee
(and any agent thereof who takes title to assets of the Company or the
Partnership, as the case may be, in a foreclosure proceeding) and rights
thereunder may not be assigned or otherwise transferred other than to a
successor Trustee hereunder. Holders of Securities shall not have any rights
under the foregoing indemnity.
SECTION 5.8.......Corporate Trustee Required; Eligibility. There shall at all
times be one (and only one) Trustee hereunder with respect to the Securities of
each series, which may be Trustee hereunder for Securities of one or more other
series. Each Trustee shall be a corporation organized and doing business under
the laws of the United States of America, any State thereof or the District of
Columbia, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least $100,000,000 and subject to
supervision or examination by Federal or State authority. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then, for the purposes
of this Section 5.8, the combined capital and surplus of such corporation shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee with respect to the
Securities of any series shall cease to be eligible in accordance with the
provisions of this Section 5.8, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article 5.
SECTION 5.9.......Resignation and Removal; Appointment of Successor. No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article 5 shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 5.10.
The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 5.10 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may at the
expense of the Company petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.
If at any time:
(a) the Trustee shall cease to be eligible under Section 5.8 and shall fail to
resign after written request therefor by the Company or by any Holder; or
(b) the Trustee shall be incapable of acting or shall be adjudged as bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
Page 47
property or affairs for the purpose of rehabilitation, conservation or
liquidation;
then, in any such case, (A) the Company by an Officer's Certificate may remove
the Trustee with respect to all Securities, or (B) subject to Section 4.14, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of the Trustee for any cause,
with respect to the Securities of one or more series, the Company, by an
Officer's Certificate, shall promptly appoint a successor Trustee or Trustees
with respect to the Securities of that or those series (it being understood that
any such successor Trustee may be appointed with respect to the Securities of
one or more or all of such series and that at any time there shall be only one
Trustee with respect to the Securities of any particular series) and shall
comply with the applicable requirements of Section 5.10. If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in Principal Amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
5.10, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to such Securities of any series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 5.10, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
to all Holders of Securities of such series in the manner provided in Section
1.6. Each notice shall include the name of the successor Trustee with respect to
the Securities of such series and the address of its Corporate Trust Office.
SECTION 5.10......Acceptance of Appointment by Successor. In case of the
appointment hereunder of a successor Trustee with respect to all Securities,
every such successor Trustee so appointed shall execute, acknowledge and deliver
to the Company and the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trust and shall duly assign, transfer
and deliver to such successor Trustee all property and money held by such
retiring Trustee hereunder.
In case of the appointment hereunder of a successor Trustee
with respect to the Securities of one or more (but not all) series, the Company,
the Partnership, the retiring Trustee and each successor Trustee with respect to
the Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (a) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates, (b) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
Page 48
retiring Trustee, and (c) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustee's
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and, upon the execution and delivery of
such supplemental indenture, the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein and each such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company or any successor
Trustee, such retiring Trustee shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee hereunder
with respect to the Securities of that or those series to which the appointment
of such successor Trustee relates.
Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be eligible under this
Article.
SECTION 5.11......Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger, conversion
or consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder (provided such
corporation shall be otherwise eligible under this Article 5), without the
execution or filing of any paper or any further act on the part of any of the
parties hereto. In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Securities so authenticated with the same effect as if such
successor Trustee had itself authenticated such Securities.
SECTION 5.12......Appointment of Paying Agent and Authenticating Agent. (a)There
shall at all times be a Paying Agent hereunder. In addition, the Trustee may
appoint an Authenticating Agent or Agents with respect to one or more series of
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities of such series issued upon exchange, registration of
transfer or partial redemption thereof or pursuant to Section 2.8, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. The Paying Agent and all Authenticating Agents shall
herein be referred to individually as an "Authorized Agent" and collectively as
the "Authorized Agents."
(b) Each Authorized Agent shall be acceptable to the Company and shall at
all times be a corporation organized and doing business under the laws
of the United States of America, any State thereof or the District of
Columbia, authorized under such laws to act as such Authorized Agent,
having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If
such Authorized Agent publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then, for the purposes of this Section 5.12, the combined
capital and surplus of such Authorized Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authorized Agent shall cease
Page 49
to be eligible in accordance with the provisions of this Section 5.12,
such Authorized Agent shall resign immediately in the manner and with
the effect specified in this Section 5.12.
(c) Any corporation into which an Authorized Agent may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authorized Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authorized Agent,
shall continue to be an Authorized Agent (provided such corporation
shall be otherwise eligible under this Section 5.12), without the
execution or filing of any paper or any further act on the part of the
Trustee or such Authorized Agent.
(d) Any Paying Agent (other than the Trustee) from time to time appointed
hereunder shall execute and deliver to the Trustee an instrument in
which said Paying Agent shall agree with the Trustee, subject to the
provisions of this Section 5.12, that such Paying Agent will:
(i) hold all sums held by it for the payment of principal of, and premium,
if any, and interest on Securities in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons
or otherwise disposed of as herein provided;
(ii) give the Trustee within five days thereafter notice of any default by
any obligor upon the Securities in the making of any such payment of
principal, premium, if any, or interest; and
(iii) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent.
Notwithstanding any other provision of this Indenture any payment required to be
made to or received or held by the Trustee may, to the extent authorized by
written instructions of the Trustee, be made to or received or held by a Paying
Agent in the Borough of Manhattan, the City of New York, for the account of the
Trustee.
(e) An Authorized Agent may resign at any time by giving written notice thereof
to the Trustee and to the Company. The Trustee may at any time terminate the
agency of an Authenticating Agent by giving written notice thereof to such
Authorized Agent and to the Company and the Company may at any time terminate
the agency of a Paying Agent by giving written notice thereof to such Authorized
Agent and to the Trustee. Upon receiving such a notice of resignation or upon
such a termination, or in case at any time such Authenticating Agent shall cease
to be eligible in accordance with the provisions of this Section 5.12, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to the Company and the Company may appoint a successor Paying Agent and give
notice of such appointment to the Trustee and the Trustee, in the case of an
Authenticating Agent, and the Company, in the case of a Paying Agent, shall give
notice of such appointment in the manner provided in Section 1.6 to all Holders
of Securities of the series with respect to which such Authorized Agent will
serve. Any successor Authorized Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as such
Authorized Agent. No successor Authorized Agent shall be appointed unless
eligible under the provisions of this Section 5.12.
(f) The Company agrees to pay to each Authorized Agent from time to time
reasonable compensation for its services under this Section 5.12.
(g) If an appointment of an Authenticating Agent with respect to one or more
series is made pursuant to this Section 5.12, the Securities of such series may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, a certificate of authentication in the following form:
Page 50
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
The Chase Manhattan Bank, as Trustee
By____________________________
As Authenticating Agent
By____________________________
As Authenticating Agent
If all of the Securities of a series may not be originally
issued at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Company wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested by the Company in writing or by
facsimile, shall appoint at the expense of the Company in accordance with this
Section 5.12 and such procedures as shall be acceptable to the Trustee, an
Authenticating Agent having an office in a Place of Payment designated by the
Company with respect to such series of Securities.
(h) The Paying Agent will comply with all applicable withholding, backup
withholding and information reporting requirements imposed by the Code and
applicable Treasury Regulations issued thereunder (including, without
limitation, the collection of Internal Revenue Service Forms W-8 or W-9, as the
case may be, and the filing of Internal Revenue Service Forms 1099, 1042 and
1042-S).
SECTION 5.13......Rights and Obligations of Trustee as Representative of the
Holders under the Security Agreements. Whenever any Security Agreement provides
that the Senior Parties are to take any action thereunder, the Trustee, as
representative of the Holders shall be obligated to solicit consents from the
Securityholders and consent on behalf of the Securityholders in accordance with
the results of such solicitation. The Trustee shall be required to consent or
not consent with respect to all matters requiring the consent of Senior Parties
in proportion to the aggregate Principal Amount of Securities the Holders of
which have consented affirmatively and negatively to the proposed action. The
Trustee shall consider any non-responses a "no" vote with respect to that
Securityholder. The expenses of any such solicitation shall be borne by the
Company and the Company shall be obligated, at the request of the Trustee, to
prepare all documents required to consummate such solicitation, including all
documents required by applicable law, including applicable securities laws. The
Trustee shall have no liability to any Person, including, without limitation,
any Senior Party, the Company or the Partnership, for any delay in consenting as
a Senior Party caused by the solicitation requirements of this Section 5.13. The
Trustee may, but shall not be obligated to, give its consent as representative
of the Holders pursuant to this Section 5.13, if the action so consented to
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise. If the Collateral Agent requires indemnity from the Trustee, as
representative of the Holders, prior to taking any action under the Security
Agreements, the Trustee shall have no responsibility for providing such
indemnity but shall request such indemnity from the Holders and shall have no
liability to any Person for any inaction by the Collateral Agent pending receipt
of such indemnity from the Holders.
ARTICLE 6
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 6.1.......Company to Furnish Trustee Names and Addresses of Holders. The
Company will furnish or cause to be furnished to the Trustee:
(a) monthly, not later than each Interest Payment Date with respect to the
Securities of each series, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Holders of Securities of such series
as of the day 15 days preceding such Interest Payment Date; and
(b) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Page 51
SECTION 6.2.......Preservation of Information; Communications to Holders. The
Trustee shall preserve, in as current a form as is reasonably practicable, the
names and addresses of Holders contained in the most recent list furnished to
the Trustee as provided in Section 6.1 and the names and addresses of Holders
received by the Trustee in its capacity as Security Registrar. The Trustee may
destroy any list furnished to it as provided in Section 6.1 upon receipt of a
new list so furnished.
The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act (as if the provisions of the Trust Indenture Act applied to
this Indenture).
Every Holder of Securities, by receiving and holding the same,
agrees with the Company, the Partnership and the Trustee that none of the
Company, the Partnership nor the Trustee, nor any agent of either of them, shall
be held accountable by reason of any disclosure of information as to names and
addresses of Holders made pursuant to the Trust Indenture Act (as if the
provisions of the Trust Indenture Act applied to this Indenture).
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.1.......Supplemental Indentures Without Consent of Holders. Subject to
the terms of the Collateral Agency Agreement that require the Required Senior
Parties to consent to certain amendments to the Indenture, without the consent
of any Holders, the Company and the Partnership, in each case when authorized by
an Officer's Certificate and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory to
the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company herein and in
the Securities, or to evidence the succession of another entity to the
Partnership and the assumption by such successor of the covenants of the
Partnership contained herein; or
(b) to add to the covenants of the Company or the Partnership for the benefit of
the Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such series) or
to surrender any right or power herein conferred upon the Company or the
Partnership; or
(c) to add any additional Events of Default for the benefit of the Holders of
all or any series of Securities (and if such additional Events of Default are to
be for the benefit of less than all series of Securities, stating that such
additional Events of Default are expressly being included solely for the benefit
of such series); or
(d) to add to or change any of the provisions of this Indenture to such extent
as shall be necessary to permit or facilitate the issuance of Securities in
bearer form, registrable or not registrable as to principal, and with or without
interest coupons, or to permit or facilitate the issuance of Securities in
uncertificated form; or
(e) to add to, change or eliminate any of the provisions of this Indenture in
respect of one or more series of Securities provided that any such addition,
change or elimination (i) shall neither (A) apply to any Security of any series
created prior to the execution of such supplemental indenture and entitled to
the benefit of such provision nor (B) modify the rights of the Holder of any
such Security with respect to such provision or (ii) shall become effective only
when there is no such Security Outstanding; or
(f) to secure the Securities, including, without limitation, by amending the
Partnership Security Agreement in accordance with Section 8.27; or
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(g) to establish the form of Securities of any series as permitted by Section
2.1, and to establish the terms of Securities of any series as permitted by
Section 2.3; or
(h) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 5.10; or
(i) to cure any ambiguity, to correct or supplement any provision herein which
may be defective or inconsistent with any other provision herein, or to make any
other provisions with respect to matters or questions arising under this
Indenture, provided that such action pursuant to this clause (i) shall not
adversely affect the interests of the Holders of Securities of any series in any
material respect; or
(j) to modify the restrictive legends set forth on the face of the form of
Security in Exhibit A or as are otherwise set forth or provided for pursuant to
Section 2.1, 2.2 or 2.3, or modify the forms of certification provided for in
Section 2.13; provided, however, that any such modification shall not adversely
affect the interest of the Holders of the Securities of any series created prior
to the execution of such supplemental indenture in any material respect; or
(k) to permit the holders of any indebtedness incurred in respect of an
Expansion to secure such indebtedness with the collateral specifically permitted
under clauses (ii), (iii) and (iv) of Section 8.20(b), and upon Completion of
such Expansion and release of the related Completion Guaranty, to permit such
holders to share equally and ratably in the Collateral; or
(l) to make any other change that does not adversely affect the interests of the
Holders of the Securities of any series created prior to the execution of such
supplemental indenture in any material respect.
SECTION 7.2.......Supplemental Indentures With Consent of Holders. Subject to
the terms of the Collateral Agency Agreement that require the Required Senior
Parties to consent to certain amendments to the Indenture, with the consent of
the Holders of not less than a majority in principal amount of the Outstanding
Securities of each series affected by such supplemental indenture, by Act of
said Holders delivered to the Company, the Partnership and the Trustee, the
Company and the Partnership, in each case when authorized by an Officer's
Certificate, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Security affected
thereby:
(a) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, any Security, or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or reduce the amount of the principal of an Original Issue
Discount Security or any other Security which would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 4.2, or
change any Place of Payment where, or the coin or currency in which, any
Security or any premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the Stated
Maturity thereof (or, in the case of redemption, on or after the Redemption
Date); or
(b) subject to Section 7.1(k), permit the creation of any lien prior to the Lien
of the Security Agreements with respect to any of the Collateral, or terminate
the Lien of the Security Agreements on any Collateral or deprive any Holder of
the security afforded by the Lien of the Security Agreements, except to the
extent expressly permitted by this Indenture or any of the Security Agreements;
or
(c) reduce the percentage in principal amount of the Outstanding Securities of
any series, the consent of whose Holders is required for any such supplemental
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indenture, or the consent of whose Holders is required for any waiver of certain
defaults hereunder and their consequences) provided for in this Indenture; or
(d) modify any of the provisions of this Section 7.2 or Section 4.13, except to
increase any such percentage or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the Holder of each
Outstanding Security affected thereby; provided, however, that this clause (d)
shall not be deemed to require the consent of any Holder with respect to changes
in the references to "the Trustee" and concomitant changes in this Section 7.2,
or the deletion of this proviso, in accordance with the requirements of Sections
5.10 and 7.1(h).
A supplemental indenture which changes or eliminates any
covenant or other provision of this Indenture which has expressly been included
solely for the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with respect to
such covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this
Section 7.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 7.3.......Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article 7 or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
5.1) shall be fully protected in relying upon, an Opinion of Counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture and that such supplemental indenture is the legal, valid and
binding obligation of the Company and the Partnership, enforceable against the
Company and the Partnership in accordance with its terms (subject to customary
qualifications and exceptions) and that all necessary consents have been
obtained. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 7.4.......Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article 7, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
SECTION 7.5.......Reference in Securities to Supplemental Indentures. Securities
of any series authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article 7 may, and if required by the
Trustee shall, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company or the Partnership
shall so determine, new Securities of any series so modified as to conform, in
the opinion of the Trustee, the Company and the Partnership, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.
ARTICLE 8
COVENANTS
Each of the Partnership and the Company covenants and agrees
that so long as this Indenture is in effect and any Securities remain
Outstanding:
SECTION 8.1.......Financial Statements, Etc. The Partnership (for itself and on
behalf of the Company) shall deliver to the Trustee and upon the request of a
beneficial holder of the Securities shall thereafter deliver to such beneficial
holder without further request:
(a) as soon as available and in any event within 60 days after the end of each
of the first three quarterly fiscal periods of each fiscal year of the
Page 54
Partnership, unaudited statements of income, retained earnings and cash flows of
each of the Partnership and the Company (commencing with the quarter ending June
30, 2001) for such period and for the period from the beginning of the
respective fiscal year to the end of such period, and the related balance sheets
of each of the Partnership and the Company as at the end of such period, setting
forth in each case in comparative form the corresponding figures for the
corresponding periods in the preceding fiscal year (except that, in the case of
balance sheets, such comparison shall be to the last day of the prior fiscal
year);
(b) as soon as available and in any event within 120 days after the end of each
fiscal year of the Partnership, audited statements of income, retained earnings
and cash flows of each of the Partnership and the Company for such fiscal year
(commencing with the year ending December 31, 2001) and the related balance
sheet of the Partnership and the Company as at the end of such fiscal year,
setting forth in each case in comparative form the corresponding figures for the
preceding fiscal year, and accompanied by an opinion thereon of independent
certified public accountants of recognized national standing, which opinion
shall state that said financial statements fairly present in all material
respects the financial condition and results of operations of each of the
Partnership and the Company as at the end of and for, such fiscal year in
accordance with RAP;
(c) together with the first quarterly report under Section 8.1(a) that is
delivered after the publication in each year of the Consumer Price Index for all
Urban Consumers (CPI/U) or a comparable index, an annual Officer's Certificate
setting forth the Escalation over the previous year and the method of
calculation thereof.
(d) as soon as practicable and in any event within 10 days after the Partnership
becomes aware or should reasonably become aware of the occurrence of an Event of
Default or Default, an Officer's Certificate setting forth the details of such
Event of Default or Default, and the action which the Partnership and the
Company propose to take with respect thereto;
(e) promptly following the effectiveness thereof, copies of each amendment,
modification, supplement or waiver to any Project Agreement, certified by a
Senior Officer of the Partnership, to be a true and complete copy of such
amendment, modification, supplement or waiver, provided that, unless requested
by the Trustee, the foregoing shall not apply to any such amendment,
modification, supplement or waiver that could not reasonably be expected to have
a Material Adverse Effect;
(f) no later than the date of the consummation of any Transfer, notice of such
event;
(g) simultaneously with the delivery of each set of financial statements
pursuant to clauses (a) and (b) of this Section 8.1, a written discussion
prepared by the Partnership of the Partnership's financial condition, changes in
financial condition and results of operations, including a description of (i)
any material developments in the Partnership's business, (ii) the Partnership's
material commitments for Capital Expenditures (not including Capital
Expenditures in connection with maintenance of the Partnership's Properties or
other Capital Expenditures made in the ordinary course) (iii) any unusual events
or transactions or any significant changes that materially affected the amount
of reported income or cash flow from continuing operations and any other
significant components of revenues of expenses, (iv) Distributions made during
the period covered by such statements and, (v) loans and other advances made by
the Partnership to any of the Partners;
(h) written notice of the occurrence of any Material Loss or Catastrophic Loss
within 10 days of the occurrence of such loss.
The Partnership will furnish to the Trustee at the time it
furnishes each set of financial statements pursuant to paragraph (a) or (b)
above, a certificate of a Senior Officer of the Partnership (i) to the effect
that no Default has occurred and is continuing (or, if any Default has occurred
and is continuing, describing the same in reasonable detail and describing the
action that the Partnership has taken or proposes to take with respect thereto),
(ii) setting forth in reasonable detail the computations necessary to determine
Page 55
whether the Obligors are in compliance with Sections 8.9 and 8.11 hereof as of
the end of the respective quarterly fiscal period or fiscal year and (iii)
certifying that the amendments, modifications, supplements and waivers referred
to in Section 8.1(d) which have become effective since (in the case of the first
such certificate) the Closing Date or (in the case of each subsequent such
certificate) the date of the next preceding such certificate and copies of which
have not been delivered to the Trustee as provided above could not, taken as a
whole, reasonably be expected to have a Material Adverse Effect.
The Trustee's sole responsibility with respect to any
statement or written discussion delivered to it pursuant to this Section 8.1
shall be to make the same available for inspection by the Holders during normal
business hours.
SECTION 8.2.......Payment of Principal, Premium and Interest. The Company
covenants and agrees for the benefit of each series of Securities that it will
duly and punctually pay the principal of, premium, if any, and interest on the
Securities of that series in accordance with the terms of the Securities and
this Indenture.
SECTION 8.3.......Existence, Etc. Each Obligor will:
(a) Subject to Section 8.6, preserve and maintain its legal existence, its
general partnership form (in the case of the Partnership) or corporate form (in
the case of the Company), and obtain and maintain, or to cause to be obtained or
maintained, as the case may be, all of its rights, licenses, permits, privileges
and franchises necessary for the operation of the Project and the conduct of its
business unless each Partner shall have determined that failure to maintain any
of such rights, licenses, permits, privileges and franchises could not
reasonably be expected (either individually or in the aggregate) to have a
Material Adverse Effect (provided that nothing in this Section 8.3 shall
prohibit any transaction expressly permitted under Section 8.6);
(b) operate and manage the Project (or cause it to be operated and managed) and
maintain, repair and preserve (or cause the maintenance, repair and preservation
of) the Project in each case (i) in compliance with, and otherwise comply with
the requirements of, all applicable Governmental Rules and Governmental
Approvals including, without limitation, all applicable laws involving pipeline
safety and environmental protection except for such failures to comply as could
not reasonably be expected to result in a Material Adverse Effect, (ii) in
accordance with the terms of the Project Agreements, (iii) in accordance with
generally accepted prudent pipeline industry standards, and (iv) subject to
Section 8.6, maintain and preserve the Project and all of its other Properties
used or useful in its business in good operating and working order and
condition, ordinary wear and tear excepted; provided however, that nothing in
this Section 8.3 shall prevent the Partnership or the Company from discontinuing
or suspending the operation or maintenance or preservation of any of such
properties if such discontinuance or suspension is, in the judgment of each
Partner, desirable in the conduct of the Partnership's business and not
disadvantageous in any material respect to the Holders; provided further, that,
except in the event of a Casualty Event, in which case the provisions of Section
9.8 shall apply with respect to the portion or portions of the Project lost,
damaged or condemned;
(c) pay and discharge all taxes, assessments and governmental charges or levies
imposed on it or on its income or profits or on any of its Property when due
except (i) for any such tax, assessment charge or levy the payment of which is
being contested in good faith and by proper proceedings and against which
adequate reserves are being maintained in accordance with RAP and (ii) to the
extent that failure to pay such taxes will not have a Material Adverse Effect on
the financial condition of the Partnership; and
(d) keep adequate records and books of account.
SECTION 8.4.......Money for Securities Payments to be Held in Trust. If the
Company shall at any time act as Paying Agent with respect to any series of
Securities, it will on or before each due date of the principal of or any
premium or interest on any of the Securities of that series, segregate and hold
in trust for the benefit of the Persons entitled thereto a sum sufficient to pay
the principal, premium, if any, and interest so becoming due until such sums
Page 56
shall be paid to such Persons or otherwise disposed of as herein provided, and
the Company will promptly notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the principal
of, premium, if any, or interest on any Securities of that series, deposit with
a Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act (as if the provisions of the Trust Indenture
Act applied to this Indenture), and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (a) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent (as if
the provisions of the Trust Indenture Act applied to this Indenture) and (b)
during the continuance of any default by the Company (or any other obligor upon
the Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
the Company by Company Order may direct any Paying Agent to pay, to the Trustee
all sums held in trust by the Company, or such Paying Agent, such sums to be
held by the Trustee upon the same trusts as those upon which such sums were held
by the Company or such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Except as otherwise required by applicable law, 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
Security of any series and remaining unclaimed for two years after such
principal, premium or interest has become due and payable shall be paid to the
Company on demand, or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
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 a newspaper published in the English language, customary
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, 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 publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 8.5.......Insurance.
(a) Except as expressly provided in the last paragraph of this Section
8.5(a), the Partnership will maintain insurance with financially sound
and reputable insurance companies and with respect to Property and
risks of a character that, in the reasonable good faith opinion of the
Partnership, are no less favorable than the insurance coverage obtained
by companies engaged in similar businesses and owning similar
properties as the Partnership; including the following insurance:
(i) Property Insurance. Insurance against loss or damage covering the
Project and other tangible real and personal Property and improvements
of the Partnership and the Company by reason of any Peril.
(ii) Business Interruption Insurance. Business interruption insurance
covering 100% of business income (defined as net profit before income
taxes, continuing normal operating expenses including payroll and
mandatory debt service) of the Project, for a period of 12 months,
arising from loss insured by clause (i) above. The maximum deductible
Page 57
in respect of such business interruption insurance shall be no greater
than $10,000,000.
(iii) Automobile Liability Insurance for Bodily Injury and Property Damage.
Insurance against liability for bodily injury and property damage in
respect of all vehicles (whether owned, hired or rented by the
Partnership or the Company) at any time located at, or used in
connection with, its Properties or operations, but in no event less
than the amount required by applicable law.
(iv) Commercial General Liability Insurance. Insurance against claims for
bodily injury, death or Property damage occurring on, in or about the
Properties (and adjoining sidewalks and waterways) of the Partnership
and the Company.
(v) Workers' Compensation Insurance. Workers' compensation insurance
(including, without limitation, Employers' Liability Insurance) to the
extent required by applicable law.
(vi) Other Insurance. Such other insurance in each case as generally carried
by Xxxxxxxx for such similar facilities.
Notwithstanding any provision in this Section 8.5 to the
contrary, (i) the Partnership shall have no obligation to maintain insurance
coverage on underground piping, and (ii) the Partnership and the Company will
not be obligated to maintain or cause to be maintained the insurance described
in this Section 8.5 during any period in which Xxxxxxxx extends its own
insurance or self-insurance to the Partnership and Company to the extent and in
the manner normal for companies of like size, type and financial condition as
the Partnership and the Company.
(b) The Collateral Agent shall be named as sole loss payee, under a standard
lenders loss payable clause or mortgage endorsement substantially equivalent to
the New York standard mortgage endorsement or lenders loss payable endorsement
form 438 BFU, without contribution, under insurance policies required by
Sections 8.5(a)(i) and (ii).
(c) On the Closing Date, the Company and the Partnership shall furnish to the
Trustee certification indicating procurement of all required insurance. Such
certification shall identify underwriters, the type of insurance, the insurance
limits, the risks covered thereby and the policy term. Upon request by the
Trustee, the Company and the Partnership will promptly furnish to the Trustee
copies of all insurance digests (or upon further request insurance policies),
binders and cover notes or other evidence of such insurance relating to the
Project.
SECTION 8.6.......Prohibition of Fundamental Changes. Except as permitted by
the Partnership Agreement:
(a) Neither Obligor will enter into any transaction of merger or consolidation
or amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), except pursuant to a Qualified Transaction.
(b) Neither Obligor will acquire any business or Property from, or capital stock
of, or be a party to any acquisition of, any Person except (in the case of the
Partnership) for the acquisition of capital stock of the Company and purchases
of inventory and other Property to be sold or used in the ordinary course of
business.
(c) Subject to Section 8.6(a), neither Obligor will sell, transfer, lease,
abandon or otherwise dispose of, in one transaction or a series of transactions,
all or substantially all of its assets. (d) Subject to Section 8.6(a), neither
Obligor will convey, sell, lease, transfer or otherwise dispose of, in one
transaction or a series of transactions, any of its business or Property,
whether now owned or hereafter acquired, that is material to the operation or
maintenance of the Project (including, without limitation, receivables and
leasehold interests) excluding (i) redundant, obsolete or worn-out Property,
tools or equipment no longer used or useful in its business and any inventory or
other Property sold or disposed of in the ordinary course of business and on
ordinary business terms and (ii) dispositions contemplated by the Project
Agreements.
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SECTION 8.7.......Ownership of the Company; No Other Subsidiaries. The
Partnership will at all times cause the Company to be a Wholly Owned Subsidiary
of the Partnership. The Partnership will at no time have any Subsidiaries other
than the Company, Subsidiaries with limited purposes similar to those of the
Company, Kern River Gas Supply Corporation and Kern River Service Corp. and the
Company will at no time have any Subsidiaries.
SECTION 8.8.......Limitation on Liens. Neither Obligor will create, incur,
assume or suffer to exist any Lien upon any of its Property, whether now owned
or hereafter acquired, except:
(a) Liens equally and ratably securing the Securities of each series;
(b) any Lien that secures Additional Senior Indebtedness equally and ratably
with the Securities;
(c) Liens imposed by any Governmental Authority for taxes, assessments or
charges not yet due or that are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on the
books of the Partnership or the Company, as the case may be, in accordance with
RAP;
(d) carriers', warehousemen's, mechanics', materialmen's, repairmen's, lessor's
other than the lessor in a sale-leaseback transaction, or other like Liens
arising in the ordinary course of business or are incident to the construction
or improvement of any Property that are not overdue for a period of more than 30
days or that are being contested in good faith and by appropriate proceedings
and Liens securing judgments as to which all rights of appeal have not
terminated and are bonded or pledged or enforcement of which will not have a
Material Adverse Effect on the Company or the Partnership but only to the
extent, for an amount and for a period not resulting in an Event of Default
under Section 4.1(k) hereof;
(e) pledges or deposits under worker's compensation, unemployment insurance and
other social security legislation;
(f) easements, rights-of-way, actions and other similar encumbrances incurred in
the ordinary course of business and encumbrances consisting of zoning
restrictions, easements, licenses, restrictions on the use of Property or minor
imperfections in title thereto that, in the aggregate, are not material in
amount, and that do not in any case materially detract from the value of the
Property subject thereto or interfere with the ordinary conduct of the business
of the Partnership or the Company;
(g) Liens upon real and/or tangible personal Property acquired after the date
hereof (by purchase, construction or otherwise) by the Partnership, each of
which Liens either (i) existed on such Property before the time of its
acquisition and was not created in anticipation thereof or (ii) was created
solely for the purpose of securing Indebtedness representing, or incurred to
finance, refinance or refund, the cost (including the cost of construction,
repair or improvement) of such Property; provided that for clause (ii) above,
(A) no such Lien shall extend to or cover any Property of the Partnership other
than the Property so acquired and improvements thereon, (B) the principal amount
of Indebtedness secured by any such Lien shall at no time exceed 100% of the
purchase price or cost or fair market value (as determined in good faith by a
Senior Officer of the Partnership) of such Property at the time it was acquired
(by purchase construction or otherwise), (C) the Indebtedness secured by the
Lien may not be incurred more than one year after the acquisition, completion of
construction, repair, improvement, or commencement of full operation of the
Property subject to the Lien, and (D) the principal amount of all such
Indebtedness secured by such Liens shall not exceed 5% of the Total
Capitalization of the Partnership in the aggregate at any one time outstanding;
(h) any Lien securing a Debt Service Letter of Credit Obligation;
(i) any Lien that extends, or renews or replaces in whole or in part a Lien
referred to herein;
Page 59
(j) additional Liens upon real and/or personal Property created after the date
hereof (including Indebtedness for capitalized lease obligations), provided that
the aggregate principal amounts of the Indebtedness secured thereby and incurred
on and after the date hereof, excluding the principal amount of Indebtedness
secured by Liens provided by clauses (a) - (h) above, shall not exceed 3% of
total capitalization of the Partnership in the aggregate at any one time
outstanding; and
(k) any Lien permitted by the foregoing that is created pursuant to the Security
Agreements.
SECTION 8.9.......Indebtedness.
(a) Limit on Indebtedness. Neither Obligor will create, incur or suffer to
exist or guarantee any Indebtedness except any one or more of the
following:
(i) Indebtedness incurred in connection with the Securities (including the
Partnership Loan, the Partnership Guarantee and the Debt Service LOC
Loans);
(ii) trade or other similar Indebtedness incurred in the ordinary course of
business;
(iii) Additional Senior Indebtedness to be used for working capital purposes
of up to the greater of (x) $15,000,000 and (y) 120% of Project
Revenues for the month immediately preceding the incurrence of such
Indebtedness;
(iv) Additional Senior Indebtedness, the proceeds of which are applied to
fund Capital Expenditures (including, without limitation, Capital
Expenditures previously made for which the FERC requires a different
percentage of Indebtedness than was originally sought by the
Partnership in an application to the FERC) provided that, after giving
effect to the incurrence of such Indebtedness, the ratio of
Indebtedness to Total Capitalization of the Partnership does not exceed
70/100;
(v) Affiliate Subordinated Debt; and
(vi) any Additional Senior Indebtedness not set forth in clauses (i) through
(v) above, so long as immediately after giving effect to the incurrence
thereof, there shall be No Ratings Downgrade.
(b) Limit on Company Indebtedness. Without prejudice to Section 8.9(a)
hereof, the Company will not create, incur or suffer to exist any
Indebtedness other than Indebtedness Guaranteed by the Partnership (i)
the proceeds of which are loaned or otherwise advanced to the
Partnership, with such loans or advances by the Company to the
Partnership evidenced by promissory notes of the Partnership in an
amount equal to the principal amount of such loan or advance, bearing
interest at a rate equal to the interest rate payable with respect to
such loan or advance and with an amortization schedule identical to the
amortization schedule with respect to such loan or advance or (ii) to
the extent the proceeds thereof are applied to repay or otherwise
refinance all or a portion of the Indebtedness with respect to the
Securities of the Company then outstanding.
SECTION 8.10......Investments. Neither Obligor will make or permit to remain
outstanding any Investments except:
(a) Permitted Investments;
(b) Investments by the Partnership in the Capital Stock of the Company;
(c) Investments by the Company in the Partnership Loan;
(d) the Debt Service LOC Account;
(e) subject to Sections 8.12 and 9.8, the redemption, retirement, prepayment or
defeasance of Indebtedness of such Obligor;
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(f) accounts receivable arising in the ordinary course of business; and
(g) Capital Expenditures as permitted hereunder which shall include all Capital
Expenditures so long as not in violation of this Indenture.
SECTION 8.11......Distributions. The Obligors shall be permitted to declare or
make any Distribution only on a Debt Service Payment Date, provided that neither
Obligor will declare or make any Distribution to any Partner on any such Debt
Service Payment Date if (i) an Event of Default has occurred and is continuing
hereunder, (ii) the ratio of Senior Debt to Total Capitalization of the
Partnership exceeds 75%, (iii) (A) the Projected Debt Service Coverage Ratio of
the Partnership for the next two calendar quarters from such date of
distribution is expected to be less than 1.25 to 1 or (B) the Debt Service
Coverage Ratio for the two calendar quarters prior to such intended Distribution
is less than 1.25 to 1, as certified by the Partnership and the Company by an
Officer's Certificate delivered to the Trustee, or (iv) the Required Amount
Condition has not been met.
SECTION 8.12......Affiliate Subordinated Debt. Neither Obligor will purchase,
redeem, retire or otherwise acquire for value, or set apart any money for a
sinking, defeasance or other analogous fund for the purchase, redemption,
retirement or other acquisition of, or make any voluntary payment or prepayment
of the principal of or interest on, or any other amount owing in respect of, any
Affiliate Subordinated Debt, except for payments or prepayments of principal and
interest in respect thereof required pursuant to the instruments evidencing such
Affiliate Subordinated Debt and permitted by the subordination provisions
thereof.
SECTION 8.13......Lines of Business; Single-Purpose Entity.
(a) The Partnership will not engage in any line of business other than that
directly related to its development, ownership and operation of the Project,
including any expansions thereof, (in each case as contemplated by the Project
Agreements) and any activities reasonably related thereto (which shall include
the gathering, marketing, sale, storage, processing and transportation of gas).
(b) The Company will not engage in any business other than the incurrence of
Indebtedness and the making of loans to the Partnership, in each case in
accordance with the terms hereof and the other Senior Debt Agreements, and the
performance of its obligations under the Transaction Agreements to which it is a
party.
SECTION 8.14......Transactions with Affiliates and Related Parties. Except for
arrangements contemplated by the Project Agreements as in effect on the date of
this Indenture, neither the Partnership nor the Company will enter into any
transaction, including, without limitation, any contract or Investment, with any
Affiliate of the Partnership unless (i) such transaction is a bona fide business
transaction reasonably related to the business of the Partnership, (ii) such
transaction is on terms that at such time are no less favorable to the
Partnership than those that could be obtained at such time in a comparable arm's
length transaction with an entity that is not an Affiliate of the Partnership
and (iii) such transaction has been fully disclosed to all Partners.
SECTION 8.15......Modifications of Certain Documents. Subject to the Collateral
Agency Agreement which requires (except as provided therein) approval by the
Required Senior Parties, among other parties, to amend any Project Agreement,
Security Agreement, Partnership Loan Agreement, the Indenture or changing in any
manner the rights of the Collateral Agent, the Partnership, the Company or the
other Senior Parties therein or thereunder, neither Obligor will (i) agree or
consent to any termination, modification, supplement or waiver of any Project
Agreement or Senior Debt Agreement or (ii) initiate changes to the Partnership's
FERC tariff if the Partnership reasonably determines that such termination,
modification, supplement, waiver or change to the tariff would individually or
collectively with all other such terminations, modifications, supplements,
waivers and changes to the tariff, reasonably be expected to have a Material
Adverse Effect, unless immediately after giving effect to such termination,
modification, supplement, waiver or change to the tariff, there shall be No
Ratings Downgrade.
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SECTION 8.16......Mandatory Obligor Actions.
If any Casualty Event shall occur, the Partnership shall
promptly notify the Trustee thereof and take reasonable steps to pursue
diligently all material rights to compensation. In addition:
(a) The Partnership shall, in the case of a Catastrophic Loss, cause all
Proceeds of such Casualty Event to be deposited with the Collateral Agent in the
Loss Proceeds Account.
(b) The Partnership shall, in the case of a Material Loss, apply the Proceeds
received by it in connection with such Casualty Event to rebuild or repair the
Project (as provided in Section 9.8).
SECTION 8.17......Rule 144A Information. At any time when the Company is not
subject to Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended, upon the request of a beneficial holder of a Security, the Company
shall promptly furnish to such beneficial holder or to a prospective purchaser
of such Security designated by such holder, as the case may be, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act
("Rule 144A Information") in order to permit compliance by such holder with Rule
144A in connection with the resale of such Security by such holder; provided,
however, that the Company shall not be required to furnish Rule 144A Information
in connection with any request made on or after the date which is two years from
the later of (a) the date such Security (or any Predecessor Security) was
acquired from the Company or (b) the date such Security (or any Predecessor
Security) was last acquired from an "affiliate" of the Company within the
meaning of Rule 144 under the Securities Act; provided, further, that the
Company shall not be required to furnish such information at any time to a
prospective purchaser located outside the United States who is not a "United
States Person" within the meaning of Regulation S under the Securities Act if
such Security may then be sold to such prospective purchaser in accordance with
Rule 904 under the Securities Act (or any successor provision thereto).
SECTION 8.18......Maintenance of Office or Agency. The Company will maintain in
each Place of Payment for any series of Securities an office or agency where
Securities of that series may be presented or surrendered for payment, where
Securities of that series may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities of that series and this Indenture may be served. The Company will
give prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies where the Securities of one or more series 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 each Place of Payment for Securities of any series for
such purposes. The Company will 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 8.19......Use of Proceeds. The Company and the Partnership agree to
apply the proceeds of the sale of the Securities hereunder (a) to repay the
Existing 144A Debt, (b) to pay certain financing costs related to the sale of
the Securities hereunder, including, without limitation, breakage costs
associated with the termination of certain existing interest rate hedging
arrangements, (c) to pay costs related to the development, financing and
construction of the California Action Project and the 2002 Expansion and (d) to
reimburse the Partnership, and its Affiliates, for any such costs incurred prior
to the date hereof.
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SECTION 8.20......Expansion. Neither Obligor shall incur indebtedness for the
purposes of financing, or permit the commencement of construction of, any
Expansion unless:
(a) Xxxxxxxx or another entity that has a public debt rating equal to at least
"BBB-" from S&P and "Baa3" from Xxxxx'x provides a Completion Guaranty with
respect to such Expansion;
b) until such Expansion has achieved Completion and the holders of the
indebtedness incurred to finance such Expansion have released the applicable
Completion Guaranty, the recourse of such holders is limited to (i) the
applicable Completion Guaranty, (ii) any LTFT Agreements and related Shipper
Guarantees entered into with respect to such Expansion, (iii) any new fixed
assets financed with the proceeds of such indebtedness, and (iv) a claim to any
cash of the Partnership that would otherwise be available for Distributions
permitted under this Indenture; provided, however, such holders shall agree not
to take any action or exercise any remedies prior to Completion that will in any
way adversely affect the ability of the Partnership to operate the existing
Pipeline; and
(c) the percentage of the costs of such Expansion that are financed with
Indebtedness incurred by the Partnership does not exceed the Applicable
Expansion Debt Level. For the purposes of this clause (c), "Applicable Expansion
Debt Level" means the lesser of (x) 70%, (y) the difference between (A) the
percentage of additional transportation capacity attributable to an Expansion
that has been contracted by shippers meeting the requirements of the
Partnership's FERC tariff and (B) 20% and (z) a percentage that causes the
average annual Projected Debt Service Coverage Ratio from the date such
Expansion reaches Completion until the Final Maturity Date of the Securities
issued on the Closing Date (after taking into account the incurrence of the
Indebtedness incurred in connection with such Expansion) to be greater than or
equal to 1.55 to 1.0. For the purposes of clarity, if 95% of an Expansion's
transportation capacity has been contracted to shippers meeting such
requirements, the Applicable Expansion Debt Level for such Expansion will be 70%
or such lower amount that allows the Partnership to satisfy the Projected Debt
Service Coverage Ratio test set forth in clause (z); and if 75% of an
Expansion's transportation capacity has been contracted to shippers meeting such
requirements, the Applicable Expansion Debt Level for such Expansion will be 55%
or such lower amount that allows the Partnership to satisfy the Projected Debt
Service Coverage Ratio test set forth in clause (z).
SECTION 8.21......Compliance With Laws. The Partnership agrees to comply with
all laws and regulations applicable to the conduct of its business and the
operation of the Project, including environmental requirements, the failure to
comply with which the Partnership believes would have a Material Adverse Effect.
SECTION 8.22......Property. The Partnership agrees to preserve good title or
valid leasehold rights to all Project related Property it claims to hold (other
than Property subject to any Casualty Event or Property disposed of pursuant to
Section 8.6), subject only to Liens permitted pursuant to Section 8.8, to the
extent that failure to do so would have a Material Adverse Effect.
SECTION 8.23......FERC Filings. The Partnership agrees to oppose any filing made
with the FERC if such filing would result in changes to the amounts being
charged to Shippers that would have a Material Adverse Effect.
SECTION 8.24......Transportation Service Agreement. Except as the FERC may
require or as the Partnership's FERC tariff may permit, the Partnership agrees
not to permit the assignment by any LTFT Shipper of its obligations under a LTFT
Agreement (including, without limitation, by way of a release of capacity to a
substitute shipper) to any party with a public debt rating of less than
investment grade or its equivalent, unless (i) the obligations of the assignee
under the LTFT Agreement are (A) guaranteed by an entity with a public debt
rating equal to at least Investment Grade or (B) supported by an Acceptable
Letter of Credit, or (ii) the rating on the Securities after giving effect to
such assignment shall be reaffirmed as being equal to or higher than the ratings
on the Securities prior to such assignment by one of the Required Rating
Agencies.
SECTION 8.25......Collateral Agency Agreement. The Securityholders agree, by
their acceptance of the Securities pursuant to the terms of this Indenture, to
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be governed by and agree to be bound by any restrictions imposed on
Securityholders pursuant to the terms of the Collateral Agency Agreement, unless
otherwise specifically stated herein.
SECTION 8.26......Transfers. The Partnership agrees not to allow any transfer of
ownership interests in the Partnership unless after giving effect to such
transfer (i) at least 50% of the Partnership is owned and operated either by
Xxxxxxxx and its affiliates or by a Qualified Transferee, or (ii) there is No
Ratings Downgrade.
SECTION 8.27......Amendment to Partnership Security Agreement. Upon Completion
of any Expansion, the Partnership agrees to amend Schedule A to the Partnership
Security Agreement to add to such Schedule A any LTFT Agreements and Shipper
Guaranties executed in connection with such Expansion.
SECTION 8.28......Debt Service Notices to Collateral Agent. If at any time, the
Partnership believes that it will have insufficient monies to pay Mandatory
Senior Debt Service on any date when it shall be due and payable, the
Partnership agrees to provide notice to such effect to the Collateral Agent at
least three (3) Business Days prior to the date on which such Mandatory Senior
Debt Service shall be due and payable. The Partnership agrees that such notice
shall state the amount of the expected insufficiency and shall otherwise be in
accordance with Sections 7.2(a)(i) and 7.2(b) of the Collateral Agency
Agreement.
ARTICLE 9
REDEMPTION OF SECURITIES
SECTION 9.1.......Applicability of Article. Securities of any series which are
redeemable before their Stated Maturity shall be redeemable in accordance with
their terms and (except as otherwise specified as contemplated by Section 2.3
for such Securities) in accordance with this Article 9.
SECTION 9.2.......Election to Redeem; Notice to Trustee. The election of the
Company to redeem any Securities shall be evidenced in accordance with Section
9.4 and otherwise in the manner specified as contemplated by Section 2.3 for
such Securities. In case of any redemption at the election of the Company, the
Company shall at least 45 days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date, of the principal amount of Securities of the
series to be redeemed and, if applicable, of the tenor of the Securities to be
redeemed. In the case of any redemption of Securities prior to the expiration of
any restriction on such redemption or subject to compliance with conditions
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officer's Certificate evidencing
compliance with such restriction or conditions. Promptly after the calculation
by the Company of the Economic Make-Whole Premium, the Company will give the
Trustee notice thereof.
SECTION 9.3.......Selection by Trustee of Securities to Be Redeemed. If less
than all the Securities of any series are to be redeemed (unless all the
Securities of such series and of a specified tenor are to be redeemed or unless
such redemption affects only a single Security), the particular Securities to be
redeemed shall be selected not more than 30 days prior to the Redemption Date by
the Trustee from the Outstanding Securities of such series not previously called
for redemption pro rata or by lot or by such other method as the Trustee shall
deem fair and appropriate and which may provide for the selection for redemption
of a portion of the Principal Amount of any Security of such series, provided
that the unredeemed portion of the Principal Amount of any Security shall be in
an authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security, except that in the case of an Installment
Security redeemed in part, the face amount thereof after such redemption and not
the unpaid Principal Amount thereof shall be in an authorized denomination for
such Security. If less than all the Securities of such series and of a specified
tenor are to be redeemed (unless such redemption affects only a single
Security), the particular Securities to be redeemed shall be selected not more
than 30 days prior to the Redemption Date by the Trustee from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
Page 64
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption as aforesaid and, in case of any
Securities selected for partial redemption as aforesaid, the principal amount
thereof to be redeemed.
The provisions of the two preceding paragraphs shall not apply
with respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 9.4.......Notice of Redemption. Notice of redemption shall be given by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be redeemed, at
his address appearing in the Security Register.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price, provided, that, if the Redemption Price includes the
Economic Make-Whole Premium, such notice need not set forth the amount of such
Economic Make-Whole Premium, but need only set forth the manner in which such
Economic Make-Whole Premium is to be calculated.
(c) if less than all the Outstanding Securities of any series consisting of more
than a single Security and of a specified tenor are to be redeemed, the
identification (and, in the case of partial redemption of any such Securities,
the Principal Amounts) of the particular Securities to be redeemed and, if less
than all the Outstanding Securities of any series consisting of a single
Security are to be redeemed, the Principal Amount of the particular Securities
to be redeemed,
(d) that, on the Redemption Date, the Redemption Price will become due and
payable upon each such Security to be redeemed and, if applicable, that interest
thereon will cease to accrue on and after said date, and that interest accrued
to the Redemption Date will be paid to the Holder of the Security on the record
date prior to the Redemption Date,
(e) the place or places where each such Security is to be surrendered for
payment of the Redemption Price,
(f) that the redemption is for a sinking fund, if such is the case, and
(g) the CUSIP or ISIN number of the Securities to be redeemed.
Notice of Redemption of Securities to be redeemed at the
election of the Company shall be given by the Company to the Trustee and each
Holder of Securities or, at the Company's request, by the Trustee to each Holder
of Securities in the name and at the expense of the Company, and shall be
irrevocable.
SECTION 9.5.......Deposit of Redemption Price. On or prior to any Redemption
Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if
the Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 8.4) an amount of money sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date)
accrued interest on, all the Securities which are to be redeemed on that date.
SECTION 9.6.......Securities Payable on Redemption Date. Notice of redemption
having been given as aforesaid, the Securities so to be redeemed shall, on the
Redemption Date, become due and payable at the Redemption Price therein
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specified, and from and after such date (unless the Company shall default in the
payment of the Redemption Price and accrued interest) such Securities shall
cease to bear interest. Upon surrender of any such Security for redemption in
accordance with said notice, such Security shall be paid by the Company at the
Redemption Price, together with accrued interest to the Redemption Date;
provided, however, that, unless otherwise specified as contemplated by Section
2.3, installments of interest whose Stated Maturity is on or prior to the
Redemption Date will be payable to the Holders of such Securities, or one or
more Predecessor Securities, registered as such at the close of business on the
relevant Record Dates according to their terms and the provisions of Section
2.9.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and premium, if any,
thereof shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
SECTION 9.7.......Securities Redeemed in Part. Any Security which is to be
redeemed only in part shall be surrendered at a Place of Payment therefor (with,
if the Company or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in writing), and
the Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities of
the same series and of like tenor of any authorized denomination as requested by
such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered; provided,
that, in the case of an Installment Security redeemed in part, no such new
Security shall be executed, authenticated and delivered in exchange for the
unredeemed portion thereof. Upon surrender of any such Installment Security, the
Security Registrar shall make a notation thereon of the unpaid principal amount
thereof.
SECTION 9.8.......Mandatory Redemption Upon a Casualty Event.
(a) Catastrophic Loss. In the event of a Catastrophic Loss, the Company shall
redeem Securities in inverse order of maturity, if applicable, in an amount
equal to the Securities Percentage of the applicable Proceeds ratably among each
series at a redemption price equal to the principal amount thereof plus accrued
interest to the Redemption Date.
(b) Material Loss. In the event of a Material Loss, the Company shall rebuild or
repair the Project.
(c) Excess Proceeds. Upon completion of the repair or restoration of the Project
following any Material Loss and the payment of all costs of such repair or
restoration, the excess, if any, of (x) the amount of the Proceeds of such
Casualty Event over (y) the aggregate amount of such costs of repair or
restoration shall be released to or for the account of, or shall otherwise be
made available to, the Partnership.
(d) Certain Notices. No later than 45 days prior to the date on which any
redemption of Securities is to be made pursuant to paragraph (a) of this Section
9.8, the Company will deliver to the Trustee a statement, certified by a Senior
Officer of the Company, in form and detail reasonably satisfactory to the
Trustee of the occurrence of such event and the amount of the Proceeds thereof.
SECTION 9.9.......Redemption at Company's Option. The Company shall have the
right to redeem all or any portion of the Outstanding Securities, in whole or in
part, at a Redemption Price equal to the Outstanding principal amount thereof
plus accrued and unpaid interest thereon to the Redemption Date, plus the
Economic Make-Whole Premium, if any, on a Redemption Date that it shall
establish in accordance with the provisions of Section 9.4 hereof.
ARTICLE 10
SINKING FUNDS
SECTION 10.1......Applicability of Article. The provisions of this Article 10
shall be applicable to any sinking fund for the retirement of Securities of any
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series except as otherwise specified as contemplated by Section 2.3 for such
Securities.
The minimum amount of any sinking fund payment provided for by
the terms of any Securities is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by the
terms of such Securities is herein referred to as an "optional sinking fund
payment". To the extent that a right to make an optional sinking fund payment is
not exercised in any year, it shall not be cumulative or carried forward to any
subsequent year. Unless otherwise provided for by the terms of any Securities,
the cash amount of any sinking-fund payment may be subject to reduction as
provided in Section 10.2. Each sinking fund payment shall be applied to the
redemption of Securities as provided for by the terms of such Securities.
SECTION 10.2......Satisfaction of Sinking Fund Payments with Securities. The
Company (a) may deliver Outstanding Securities of a series (other than any
previously called for redemption) and (b) may apply as a credit Securities of a
series which have been redeemed either at the election of the Company pursuant
to the terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities, in each case in
satisfaction of all or any part of any sinking fund payment with respect to any
Securities of such series required to be made pursuant to the terms of such
Securities as and to the extent provided for by the terms of such Securities;
provided that the Securities to be so credited shall not have been previously so
credited. The Securities to be so credited shall be received and credited for
such purpose by the Trustee at the Redemption Price, as specified in the
Securities so to be redeemed, for redemption through operation of the sinking
fund and the amount of such sinking fund payment shall be reduced accordingly.
SECTION 10.3......Redemption of Securities for Sinking Fund. Not less than 60
days prior to each sinking fund payment date for any Securities, the Company
will deliver to the Trustee an Officer's Certificate specifying the amount of
the next ensuing sinking fund payment for such Securities pursuant to the terms
of such Securities, the portion thereof, if any, which is to be satisfied by
payment of cash, the portion thereof, if any, which is to be satisfied by
delivering and crediting Securities pursuant to Section 10.2, the basis for such
credit, and that such Securities have not been previously so credited, and will
also deliver to the Trustee any Securities to be so delivered. Not less than 45
days prior to each such sinking fund payment date, the Trustee shall select the
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 9.3 and cause notice of the redemption thereof to be given
in the name of and at the expense of the Company in the manner provided in
Section 9.4. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections 9.6
and 9.7.
ARTICLE 11
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.1......Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 11.2 or
Section 11.3 applied to any Securities or any series of Securities, as the case
may be, designated pursuant to Section 2.3 as being defeasible pursuant to such
Section 11.2 or 11.3, in accordance with any applicable requirements provided
pursuant to Section 2.3 and upon compliance with the conditions set forth below
in this Article 11. Any such election shall be evidenced in the manner specified
as contemplated by Section 2.3 for such Securities.
SECTION 11.2......Defeasance and Discharge. Upon the Company's exercise of its
option (if any) to have this Section 11.2 applied to any Securities or any
series of Securities, as the case may be, the Company shall be deemed to have
been discharged from its obligations with respect to such Securities as provided
in this Section on and after the date the conditions set forth in Section 11.4
are satisfied (hereinafter called "Defeasance"). For this purpose, such
Defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by such Securities and to have satisfied all
its other obligations under such Securities and this Indenture insofar as such
Securities are concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), subject to the following
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which shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of such Securities to receive, solely from the trust fund
described in Section 11.4 and as more fully set forth in such Section 11.4,
payments in respect of the principal of, premium, if any, and interest on such
Securities when payments are due, (b) the Company's obligations with respect to
such Securities under Sections 2.7, 2.8, 8.4 and 8.17, (c) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and (d) this Article 11.
Subject to compliance with this Article 11, the Company may exercise its option
(if any) to have this Section 11.2 applied to any Securities notwithstanding the
prior exercise of its option (if any) to have Section 11.3 applied to such
Securities.
SECTION 11.3......Covenant Defeasance. Upon the Company's exercise of its option
(if any) to have this Section 11.3 applied to any Securities or any series of
Securities, as the case may be, (a) the Company shall be released from its
obligations under Sections 8.1 (other than the obligation set forth in clause
(i) of the last paragraph thereof, such delivery obligation to be fulfilled
within 60 days after the end of each of the first three quarterly fiscal periods
of each fiscal year of the Partnership and within 120 days after the end of each
fiscal year of the Partnership), 8.5 and 8.7 through 8.16, inclusive, 8.21
through 8.24 inclusive, 8.26 and 8.27 and any covenants provided pursuant to
Section 2.3(s), 7.1(b) or 7.1(g) for the benefit of the Holders of such
Securities and (b) the occurrence of any event specified in Sections 8.1 (other
than the obligation set forth in clause (i) of the last paragraph thereof, such
delivery obligation to be fulfilled within 60 days after the end of each of the
first three quarterly fiscal periods of each fiscal year of the Partnership and
within 120 days after the end of each fiscal year of the Partnership) and 8.5
and 8.7 through 8.16, inclusive, 8.21 through 8.24 inclusive, 8.26 and 8.27 and
any such covenants provided pursuant to Section 2.3(s), 7.1(b) or 7.1(g) shall
be deemed not to be or result in an Event of Default in each case with respect
to such Securities as provided in this Section 11.3 on and after the date the
conditions set forth in Section 11.4 are satisfied (hereafter called "Covenant
Defeasance"). For this purpose, such Covenant Defeasance means that, with
respect to such Securities, the Company may omit to comply with and shall have
no liability in respect of any term, condition or limitation set forth in any
such specified Section, whether directly or indirectly by reason of any
reference elsewhere herein to any such Section or by reason of any reference in
any such Section to any other provision herein or in any other document, but the
remainder of this Indenture and such Securities shall be unaffected thereby.
SECTION 11.4......Conditions to Defeasance or Covenant Defeasance. The following
shall be the conditions to the application of Section 11.2 or Section 11.3 to
any Securities or any series of Securities, as the case may be:
(a) The Company shall irrevocably have deposited or caused to be deposited with
the Trustee as trust funds in trust for the purpose of making the following
payments, specifically pledged as security for, and dedicated solely to, the
benefits of the Holders of such Securities, (i) money in an amount, or (ii) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, money in an amount, or
(iii) a combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge,
and which shall be applied by the Trustee to pay and discharge, the principal
of, premium, if any, and interest on such Securities on the respective Stated
Maturities or Redemption Dates, in accordance with the terms of this Indenture
and such Securities. As used herein, "U.S. Government Obligation" means (x) any
security which is (i) a direct obligation of the United States of America for
the payment of which the full faith and credit of the United States of America
is pledged or (ii) an obligation of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which in either case (i) or (ii), is
not callable or redeemable at the option of the issuer thereof, and (y) any
depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act) as custodian with respect to any U.S. Government Obligation
which is specified in clause (x) above and held by such bank for the account of
the holder of such depositary receipt, or with respect to any specific payment
of principal of or interest on any U.S. Government Obligation which is so
Page 68
specified and held, 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 U.S. Government Obligation or the specific payment of principal or interest
evidenced by such depositary receipt.
(b) In the event of an election to have Section 11.2 apply to any Securities or
any series of Securities as the case may be, the Company shall have delivered to
the Trustee an Opinion of Counsel stating that (i) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling or
(ii) since the date of this instrument, there has been a change in the
applicable Federal income tax law, in either case (i) or (ii) to the effect
that, and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit, Defeasance and discharge to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount, in
the same manner and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.
(c) In the event of an election to have Section 11.3 apply to any Securities or
any series of Securities, as the case may be, the Company shall have delivered
to the Trustee an Opinion of Counsel to the effect that the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit and Covenant Defeasance to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount, in
the same manner and at the same times as would be the case if such deposit and
Covenant Defeasance were not to occur.
(d) The Company shall have delivered to the Trustee an Officer's Certificate to
the effect that neither such Securities nor any other Securities of the same
series, if then listed on any securities exchange, will be delisted as a result
of such deposit.
(e) No Default with respect to such Securities or any other Securities shall
have occurred and be continuing at the time of such deposit or, with regard to
any such event specified in Sections 4. 1 (g), (h) and (i), at any time on or
prior to the 90th day after the date of such deposit (it being understood that
this condition shall not be deemed satisfied until after such 90th day).
(f) Such Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which it is bound.
(g) Such Defeasance or Covenant Defeasance shall not result in the trust arising
from such deposit constituting an investment company within the meaning of the
Investment Company Act unless such trust shall be registered under such Act or
exempt from registration thereunder.
(h) At the time of such deposit, (i) no default in the payment of any principal
of or premium or interest on any Securities shall have occurred and be
continuing, (ii) no Event of Default with respect to any Securities shall have
resulted in such Securities becoming, and continuing to be, due and payable
prior to the date on which they would otherwise have become due and payable
(unless payment of such Securities has been made or duly provided for), and
(iii) no other Event of Default with respect to any Securities shall have
occurred and be continuing permitting (after notice or lapse of time or both)
the Holders of such Securities (or a Trustee on behalf of such Holders) to
declare such Securities due and payable prior to the date on which they would
otherwise have become due and payable.
(i) Any Securities that are to be redeemed in connection with any Defeasance or
Covenant Defeasance shall be redeemed in accordance with arrangements
satisfactory to the Trustee for the giving of irrevocable notice of redemption
by the Trustee in the name, and at the expense of the Company.
(j) The Company shall have delivered to the Trustee an Officer's Certificate and
an Opinion of Counsel each stating that all conditions precedent with respect to
such Defeasance or Covenant Defeasance have been complied with.
Page 69
SECTION 11.5......Deposited Money and U.S. Government Obligations to Be Held in
Trust; Miscellaneous Provisions. Subject to the provisions of the last paragraph
of Section 8.4, all money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee pursuant to Section 11.4 in respect
of any Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any such Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Securities, of all sums due and to become due thereon in respect of
principal and any premium and interest, but money so held in trust need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 11.4 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 Outstanding Securities.
Anything in this Article 11 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon receipt
of a Company Request any money or U.S. Government Obligations held by it as
provided in Section 11.4 with respect to any Securities which, in the opinion of
a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee are in excess of the
amount thereof which would then be required to be deposited to effect the
Defeasance or Covenant Defeasance, as the case may be, with respect to such
Securities.
SECTION 11.6......Reinstatement. If the Trustee or the Paying Agent is unable to
apply any money in accordance with this Article 11 with respect to any
Securities by reason of any order or judgment of any court or Governmental
Authority enjoining, restraining or otherwise prohibiting such application, then
the obligations under this Indenture and such Securities from which the Company
has been discharged or released pursuant to Section 11.2 or 11.3 shall be
revived and reinstated as though no deposit had occurred pursuant to this
Article 11 with respect to such Securities, until such time as the Trustee or
Paying Agent is permitted to apply all money held in trust pursuant to Section
11.5 with respect to such Securities in accordance with this Article 11 ;
provided however, that if the Company makes any payment of principal of or any
premium or interest on any such Security following such reinstatement of its
obligations, the Company, as the case may be, shall be subrogated to the rights
(if any) of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations so held in trust.
ARTICLE 12
PARTNERSHIP GUARANTEE
SECTION 12.1......Obligations Guaranteed. (a) The Partnership hereby guarantees,
subject to the provisions of Section 13.2, to the Trustee for its own benefit
and the benefit of the Holders from time to time (i) the full and prompt payment
of the principal of and premium, if any, on the Securities and the indebtedness
represented thereby, when and as the same shall become due and payable, whether
at the Stated Maturity thereof, by acceleration, call for redemption or
otherwise, (ii) the full and prompt payment of interest on the Securities when
and as the same shall become due and payable (the guarantee in clauses (i) and
(ii) collectively referred to as the "Partnership Guarantee"), and (iii) the
full and prompt payment to the Trustee of all fees, costs, expenses, or other
amounts payable to the Trustee under the Indenture when and as the same shall
become due and payable. The Partnership hereby irrevocably and unconditionally
agrees, subject to the provisions of Section 12.2 and Section 13.2 that upon any
default by the Company in the payment, when due, of any principal of, premium,
if any, or interest on the Securities, and after demand therefore being made
upon the Company by the Trustee, the Partnership will promptly pay the same. All
payments by the Partnership shall be paid in lawful money of the United States
of America. Each and every default in the payment of the principal of, premium,
if any, or interest on the Securities shall, subject to the provisions of
Section 13.2, give rise to a separate cause of action hereunder, and separate
suits may be brought hereunder as each cause of action arises.
Page 70
(b) The Partnership further agrees, subject to the provisions of Section 12.2
and Section 13.2, that this Partnership Guarantee constitutes an absolute,
present and continuing guarantee of payment and not of collection, and waives
any right to require that any resort be had by the Trustee or the Holders of the
Securities, after demand for such payment being made upon the Company by the
Trustee, to the Trustee's or any Holder's rights against any other Person, or
any other right or remedy available to the Trustee or any Holder of the
Securities by contract, applicable law or otherwise. The obligations of the
Partnership under this Partnership Guarantee are direct, unconditional and
completely independent of the obligations of any other Person, and, subject to
the provisions of Section 12.2; a separate cause of action or separate causes of
action may be brought and prosecuted against the Partnership, after demand for
payment being made upon the Company by the Trustee, without the necessity of
joining the Company or any other party or previously proceeding with or
exhausting any other remedy against any other Person who might have become
liable for the indebtedness or of realizing upon any security held by or for the
benefit of the Holders of the Securities.
SECTION 12.2......Obligations Unconditional. The obligations of the Partnership
under this Partnership Guarantee shall, subject to the provisions of Section
13.2, be absolute and unconditional, and shall remain in full force and effect,
until the entire principal of, premium, if any, and interest on the Securities
shall have been paid in full or provided for and all costs, Trustee's fees and
commissions, indemnitees, and expenses, if any, shall have been paid in full
and, to extent permitted by law, such obligations shall not be affected,
modified, released or impaired by any state of facts or the happening from time
to time of any event, whatsoever, whether or not with notice to, or the consent
of, the Partnership, except as set forth in Section 13.2 hereof.
SECTION 12.3......No Waiver or Set-off. No act of commission or omission of any
kind or at any time upon the part of the Company or the Trustee, or their
successors and assigns, in respect of any matter whatsoever shall in any way
impair the rights of the Trustee to enforce any right, power or benefit under
this Partnership Guarantee and no set-off, counterclaim, reduction, or
diminution of any obligation, or any defense of a surety guarantor (other than
performance by the Partnership of its obligations hereunder, or receipt by the
Trustee of payment from the Company) which the Partnership has or may have
against the Company or the Trustee or any assignee or successor thereof shall be
available hereunder to the Partnership.
SECTION 12.4......Waiver of Notice; Expenses. The Partnership hereby expressly
waives notice from the Trustee or the Holders from time to time of the
Securities of their acceptance and reliance on this Partnership Guarantee of any
action taken or omitted in reliance hereon. The Partnership further expressly
waives diligence, presentment, demand for payment, protest, any requirement that
any right or power be exhausted or any action be taken against the Company or
the Partnership or against any Collateral. The Partnership agrees to pay all
reasonable costs, Trustee's fees and commissions and expenses (including all
court costs and reasonable attorneys' fees) which may be incurred by the Trustee
in enforcing or attempting to enforce this Partnership Guarantee following any
default on the part of the Partnership hereunder, whether the same shall be
enforced by suit or otherwise.
SECTION 12.5......Benefit and Enforcement. This Partnership Guarantee is given
for the benefit of the Company and the Trustee and, subject to the terms and
conditions set forth herein, including Section 4.7, the Holders from time to
time of the Securities, all of whom shall be entitled in the same manner as set
forth herein to enforce performance and observance of this Partnership
Guarantee.
SECTION 12.6......Survival of Partnership Guarantee Obligation; Waiver of
Subrogation. (a) If the Trustee receives any payment on account of the
liabilities guaranteed hereunder, which payment or any part thereof is
subsequently invalidated declared to be fraudulent or preferential, set aside
and/or required to be transferred or repaid to a trustee, receiver, assignee for
the benefit of creditors or any other party under any bankruptcy act or code,
state or federal law of common law or equitable doctrine, then to the extent of
any sum not finally retained by the Trustee, this Partnership Guarantee shall
remain in full force and effect until the Partnership shall have made payment to
the Trustee of such sum, which payment shall be due on demand.
Page 71
(b) The Partnership hereby irrevocably waives any and all right to which it may
be entitled, by operation of law or otherwise, upon making any payment hereunder
(i) to be subrogated to the rights of the Trustee or the Holders against the
Company (or any Collateral) with respect to such payment or otherwise to be
reimbursed, indemnified or exonerated by the Company (or from the proceeds of
the Collateral) in respect thereof, or (ii) to receive any payment, in the
nature of contribution or for any other reason, from any other guarantor with
respect to such payment.
SECTION 12.7......Pledge of Partnership Collateral. As security for the prompt
payment and performance of all obligations of the Partnership under this
Partnership Guarantee, the Partnership has entered into the Partnership Security
Agreement to pledge, assign, hypothecate, bargain, sell, convey, mortgage and
grant to the Collateral Agent a security interest in and general lien upon all
of the Collateral owned by the Partnership. The pledge and assignment by the
Partnership of such Collateral is collateral and security for the prompt payment
and performance of the obligations of the Partnership under this Partnership
Guarantee.
ARTICLE 13
LIMITATION OF LIABILITY
SECTION 13.1......Company. No recourse shall be had for the payment of the
principal (or premium, if any) or the interest on any Security, or for any claim
based thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or agreement in this
Indenture or any other Transaction Agreement, against any Affiliate of the
Company or any incorporator, stockholder, officer, employee, partner, member or
director as such, past, present or future, of the Company or any Affiliate of
the Company or of any predecessor or successor (either directly or through the
Company or any such predecessor or successor), whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Company's obligation under the Securities, this Indenture and other Transaction
Agreements and all the obligations are solely corporate obligations of the
Company's, and that no personal liability whatsoever shall attach to, or be
incurred by any Affiliate of the Company or any such incorporator, stockholder,
officer, employee, partner, member or director, past, present or future, of the
Company or any Affiliate of the Company or of any such predecessor or successor
(either directly or indirectly through the Company or any such predecessor or
successor), because of any of the obligations, covenants, promises or agreements
contained in the Securities, this Indenture or any other Transaction Agreement
or to be implied herefrom or therefrom; and that any such personal liability is
hereby expressly waived and released as a condition of, and as part of the
consideration for, the execution of this Indenture and the delivery of the
Securities; provided, however, that nothing contained herein or in the
Securities shall be taken to prevent the institution of proceedings against any
Person in connection with the realization of the benefit of the Collateral
granted under the Security Agreements; and provided, further, that nothing in
this Section 13.1 shall relieve any Person of its obligations under this
Indenture, the Securities or any other Transaction Agreement to which such
Person is a party or limit or otherwise prejudice in any way the right of the
Collateral Agent or the Trustee to proceed against any such Person with respect
to the enforcement of such obligations.
SECTION 13.2......Partnership. Satisfaction of the obligations of the
Partnership under this Instrument and the Securities shall be had solely from
the assets of the Partnership. No recourse shall be had in the event of any
non-performance by the Partnership of any such obligations to (a) any assets or
properties of the Partners other than their respective interests in the
Collateral or (b) any Partners or any Affiliate of any Partners or of the
Partnership or any incorporator, stockholder, partner, member, officer, employee
or director, past, present or future, of any such Partner or Affiliate or of any
predecessor or successor (either directly or through either Partnership or any
Partner or any such predecessor or successor), whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, and no judgment for any deficiency upon the obligations of
the Partnership under this Indenture and the Securities shall be obtainable by
the Collateral Agent or the Trustee against any Partner or any Affiliate of any
Page 72
Partner or of the Partnership or any incorporator, stockholder, partner, member,
officer, employee or director, past, present or future, of any Partner or
Affiliate or of any predecessor or successor of any such Partner or Affiliate;
provided, however, that nothing in this Section 13.2 shall relieve any Person of
its obligations under any Transaction Agreement to which such Person is a party
or limit or otherwise prejudice in any way the right of the Collateral Agent or
the Trustee to proceed against such Person with respect to the enforcement of
such obligations.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed and their respective seals to be hereunto affixed
and attested, all as of the day and year first above written.
KERN RIVER FUNDING CORPORATION
By:
------------------------------------
Name:
Title:
KERN RIVER GAS TRANSMISSION COMPANY
By: KERN RIVER ACQUISITION, LLC,
as General Partner
By:
------------------------------------
Name:
Title:
By: XXXXXXXX WESTERN PIPELINE COMPANY, LLC,
as General Partner
By:
-------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Trustee
By:
-------------------------------------
Name:
Title:
Page 73
EXHIBIT A
[FORM OF FACE OF SECURITY]
[GLOBAL SECURITIES LEGEND]
[INCLUDE IF SECURITY IS A GLOBAL SECURITY - UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO KERN RIVER FUNDING CORPORATION ("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 AN INTEREST HEREIN.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO. THIS GLOBAL SECURITY MAY NOT BE EXCHANGED, IN
WHOLE OR IN PART, FOR A SECURITY REGISTERED IN THE NAME OF ANY PERSON OTHER THAN
THE DEPOSITORY TRUST COMPANY OR A NOMINEE THEREOF EXCEPT IN THE CIRCUMSTANCES
SET FORTH IN SECTION 2.7 OF THE INDENTURE, AND MAY NOT BE TRANSFERRED, IN WHOLE
OR IN PART, EXCEPT IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.7
OF THE INDENTURE. BENEFICIAL INTERESTS IN THIS GLOBAL SECURITY MAY NOT BE
TRANSFERRED EXCEPT IN ACCORDANCE WITH SECTION 2.7 OF THE INDENTURE.]
[RESTRICTED SECURITIES LEGEND]
[INCLUDE IF SECURITY IS A RESTRICTED SECURITY OR A TEMPORARY
REGULATION S GLOBAL SECURITY (UNLESS, PURSUANT TO SECTION 2.7, THE COMPANY
DETERMINES THAT THE LEGEND MAY BE REMOVED) - THIS SECURITY (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 SECURITY MAY NOT
BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY 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 ANY 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
SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AS THE COMPANY MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.]
[Insert any legend required by the Internal Revenue Code of
1986, as amended, and the regulations thereunder.]
Page 74
KERN RIVER FUNDING CORPORATION
6.676% Senior Note due 2016
No. $
---------- ----------
KERN RIVER FUNDING CORPORATION, a corporation duly organized
and existing under the laws of the State of Delaware (herein called the
"Company," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to , or
registered assigns, [INCLUDE IF THIS SECURITY IS A GLOBAL SECURITY -- the
Initial Principal Amount specified on Schedule A hereto (such Initial Principal
Amount, as it may from time to time be adjusted by endorsement on Schedule A
hereto, is hereinafter referred to as the "Principal") [INCLUDE IF THIS SECURITY
IS NOT A GLOBAL SECURITY -- the principal sum of Dollars (the "Principal
Amount")] on [if the Security is to bear interest prior to Maturity, insert -- ,
and to pay interest thereon from [________] or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, monthly on
the last day of each month, commencing [________], at the rate of [__]% per
annum (computed on the basis of a 360-day year of twelve 30-day months), until
the principal hereof is paid or made available for payment [if applicable,
insert --, provided that any principal and premium, and any such installment of
interest, which is overdue shall bear interest at the rate of % per annum (to
the extent that the payment of such interest shall be legally enforceable), from
the dates such amounts are due until they are paid or made available for
payment, and such interest shall be payable on demand]. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the 15th day of the
month (whether or not a Business Day), in which each applicable Interest Payment
Date shall occur. Any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Company, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture].
[If the Security is not to bear interest prior to Maturity,
insert -- The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated Maturity and in such case the overdue principal and any overdue
premium shall bear interest at the rate of % per annum, (to the extent that the
payment of such interest shall be legally enforceable), from the dates such
amounts are due until they are paid or made available for payment. Interest on
any overdue principal or premium shall be payable on demand. [Any such interest
on overdue principal or premium which is not paid on demand shall bear interest
at the rate of __% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable) from the date of such demand until the
amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if
applicable, insert - any such interest] on this Security will be made at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City of New York in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts [if applicable, insert -- ; provided, however, that at the option
of the Company payment of interest may be made by check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register], provided, further, that, in the case of an Installment Security,
payment of principal and premium, if any, shall also be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Registrar without any requirement for the presentation and surrender of
such Security at such office or agency, except in connection with a redemption
or the final principal payment thereon.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
Page 75
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
Dated:
KERN RIVER FUNDING CORPORATION,
As Issuer
By
----------------------------------
KERN RIVER GAS TRANSMISSION COMPANY,
As Guarantor
By
----------------------------------
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in
the within mentioned Indenture.
THE CHASE MANHATTAN BANK
As Trustee
By
----------------------------------
Authorized Officer
Page 76
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under a Trust Indenture, dated as of August 13, 2001(as the same
may be amended or supplemented from time to time the "Indenture"), among Kern
River Funding Corporation, as issuer (the "Company"), Kern River Gas
Transmission Company, as guarantor (the "Partnership"), and The Chase Manhattan
Bank, as trustee (the "Trustee," which term includes any successor trustee under
the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Partnership, the Trustee and the Holders of the Securities
and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof [if
applicable, insert -- , limited in principal amount to $510,000,000.
If applicable, insert -- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, [if
applicable, insert -- (1) on _____ in any year commencing with the year _____
and ending with the year _____through operation of the sinking fund for this
series at a Redemption Price equal to 100% of the principal amount hereof, and
(2)] at any time [if applicable, insert -- on or after ________,_____], as a
whole or in part, at the election of the Company at a Redemption Price equal to
100% of the principal amount hereof plus the Economic Make-Whole Premium, with
accrued interest to the Redemption Date, but interest installments whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders
of such Securities, or one or more Predecessor Securities, of record at the
close of business on the relevant Record Dates referred to on the face hereof
all as provided in the Indenture.]
[if applicable, insert -- The sinking fund for this series
provides for the redemption on _____ in each year _____ beginning ___________
with the year ________ and ending with the year __________ of [if applicable,
insert -- not less than $__________ ("mandatory sinking fund") and not more
than] $____________ aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [if applicable, insert -- mandatory] sinking fund payments may be
credited against subsequent [if applicable, insert -- mandatory] sinking fund
payments otherwise required to be made [if applicable, insert -- , in the
inverse order in which they become due].]
[If the Security is subject to redemption of any kind, insert
-- Except in the case of an Installment Security, in the event of redemption of
this Security in part only, a new Security or Securities of this series and of
like tenor for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.)
[If applicable, insert -- The indenture contains provisions
for defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security,
insert -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.]
If the Security is an Original Issue Discount Security, insert
-- If an Event of Default with respect to Securities of this series shall occur
and be continuing, an amount of principal of the Securities of this series may
be declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable) all of the Company's obligations in respect of the payment of the
principal of and principal and interest, if any, on the Securities of this
series shall terminate.]
Subject to certain limitations in the Indenture, at any time
when the Company is not subject to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), upon the request of a
Holder of a Security [or of a beneficial owner of an interest in a Global
Security], the Company will promptly furnish or cause to be furnished Rule 144A
Information (as defined below) to such Holder [or beneficial owner), or to a
prospective purchaser of a Security [or a beneficial interest in a Global
Security] designated by such Holder [or beneficial owner of such interest], in
order to permit compliance by such Holder [or beneficial owner] with Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act"). "Rule 144A
Information" shall be such information as is specified pursuant to Rule
144A(d)(4) under the Securities Act (or any successor provision thereto).
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Partnership and the rights of the Holders of
the Securities of each series to be affected under the Indenture at any time by
the Company, the Partnership and the Trustee with the consent of the Holders of
a majority in principal amount of the Securities at the time Outstanding of each
series to be affected. The Indenture also contains provisions permitting the
Holders of specified percentage in principal amount of the Securities of each
series at the time Outstanding, on behalf of the Holders of all Securities of
such series, to waive certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture,
the Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Page 77
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity.
The foregoing shall not apply to any suit by the Holder of
this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair (i) the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed or (ii) the unconditional guarantee of the
Partnership of the obligations of the Company under this Security and the
Indenture.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company maintained for such purpose in
any place where the principal of and any premium and interest on this Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of $100,000 and any integral multiples of
$1,000 in excess thereof. As provided in the Indenture and subject to certain
limitations therein set forth Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and none of
the Company, the Trustee and any such agent shall be affected by notice to the
contrary.
Each holder, by acceptance of this Security, hereby
acknowledges and agrees that (i) no recourse shall be had for the payment of the
principal of or the interest on this Security, or any part thereof, or for any
claim based thereon or otherwise in respect thereof, or of the indebtedness
represented hereby against any Affiliate of the Company (other than the
Partnership) or any incorporator, stockholder, officer, employee or director, as
such, present or future, of the Company or any Affiliate of the Company or of
any predecessor or successor, all as provided in Section 13.1 of the Indenture
and (ii) no recourse shall be had in the event of any non-performance by the
Partnership of any obligations of the Partnership under this Security or the
Indenture to the Partners or any Affiliate thereof or to any assets or
properties of the Partners other than their respective interests in the
Collateral, all as provided in Section 13.2 of the Indenture.
The Securities are subject to a Collateral Agency Agreement
dated as of August 13, 2001 pursuant to which the rights of the Senior Parties
(including the Holders of the Securities and certain other creditors of the
Company and the Partnership) in respect of the Collateral will be shared among
the Senior Parties and will be exercised by the Collateral Agent in accordance
with the Collateral Agency Agreement.
Page 78
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
This Security shall be governed by and construed in accordance
with the laws of the State of New York.
[IF SECURITY IS A GLOBAL SECURITY, INSERT AS A SEPARATE PAGE --
THE INITIAL PRINCIPAL AMOUNT OF THIS GLOBAL SECURITY IS ______.
Schedule A
SCHEDULE OF ADJUSTMENTS
Notation made on
Principal amount of Principal amount of Principal amount behalf of the
Date adjustment made increase decrease following adjustment Security Registrar
Page 79
EXHIBIT B
FORM OF TRANSFER CERTIFICATE
FOR EXCHANGE OR TRANSFER FROM RESTRICTED GLOBAL
SECURITY TO REGULATION S GLOBAL SECURITY
(Transfers pursuant to Section 2.7(c)(v)(B)
of the Indenture)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Institutional Trust Services
Re: Kern River Funding Corporation
6.676% Senior Notes Due 2016 (the "Securities")
Reference is hereby made to the Trust Indenture, dated as of
August 13, 2001 (the "Indenture"), among Kern River Funding Corporation, as
issuer (the "Company") Kern River Gas Transmission Company, as guarantor, and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to US$510,000,000 principal amount of
Securities which are evidenced by one or more Restricted Global Securities
(CUSIP No. 00000XXX0) and held with the Depository in the name of [Insert Name
of Transferor] (the "Transferor"). The Transferor has requested a transfer of
such beneficial interest in the Securities to a Person who will take delivery
thereof in the form of an equal principal amount of Securities evidenced by one
or more Regulation S Global Securities (ISIN No. USU4912PAC42), which amount,
immediately after such transfer, is to be held with the Depository through
Euroclear or Clearstream or both (Common Code ________).
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that such transfer has been
effected pursuant to and in accordance with Rule 903 or Rule 904 under the
United States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor does hereby further certify that:
(a) the offer of the Securities was not made to a person in the
United States;
(b) either:
(i) at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person
acting on its behalf reasonably believed and believes that the
transferee was outside the United States; or
(ii) the transaction was executed in, or through the facilities of
a designated offshore securities market and neither the
Transferor nor any person acting on its behalf knows that the
transaction was prearranged with a buyer in the United States;
(c) no directed selling efforts have been made in contravention of
the requirements of Rule 903(b) or 904(b) of Regulation S, as
applicable;
(d) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(e) upon completion of the transaction, the beneficial interest
being transferred as described above is to be held with the
Depository through Euroclear or Clearstream or both (Common
Code ___).
Page 80
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the underwriters or initial
purchasers, if any, of the initial offering of such Securities being
transferred. Terms used in this certificate and not otherwise defined in the
Indenture have the meanings set forth in Regulation S under the Securities Act.
[Insert Name of Transferor]
By:
----------------------------------------
Name:
Title:
Dated: _____________, ____
cc: Kern River Funding Corporation
Page 81
EXHIBIT C
FORM OF TRANSFER CERTIFICATE
FOR TRANSFER OR EXCHANGE FROM REGULATION S
GLOBAL SECURITY TO RESTRICTED GLOBAL SECURITY
(Transfers Pursuant to Section 2.7(c)(v)(D)
of the Indenture)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Institutional Trust Services
Re: Kern River Funding Corporation
6.676% Senior Notes Due 2016 (the "Securities")
Reference is hereby made to the Trust Indenture, dated as of
August 13, 2001 (the "Indenture"), among Kern River Funding Corporation, as
issuer (the "Company") Kern River Gas Transmission Company, as guarantor, and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to US$510,000,000 principal amount of
Securities which are evidenced by one or more Regulation S Global Securities
(ISIN No. USU4912PAC42) and held with the Depository through [Euroclear]
[Clearstream] (Common Code ______) in the name of [Insert Name of Transferor]
(the "Transferor"). The Transferor has requested a transfer of such beneficial
interest in the Securities to a Person who will take delivery thereof in the
form of an equal principal amount of Securities evidenced by one or more
Restricted Global Securities (CUSIP No. 00000XXX0), to be held with the
Depository.
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that such transfer has been
effected pursuant to and in accordance with Rule 144A under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the
Transferor does hereby further certify that the Securities are being transferred
to a Person that the Transferor reasonably believes is purchasing the Securities
for its own account, or for one or more accounts with respect to which such
Person exercises sole investment discretion, and such Person and each such
account is a "qualified institutional buyer" within the meaning of Rule 144A, in
each case in a transaction meeting the requirements of Rule 144A and in
accordance with any applicable blue sky or securities laws or any state of the
United States.
Page 82
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the underwriters and initial
purchasers, if any, of the Securities being transferred.
[Insert Name of Transferor]
By:
----------------------------------
Name:
Title:
Dated: _____________, ____
cc: Kern River Funding Corporation
Page 83
EXHIBIT D
FORM OF TRANSFER CERTIFICATE
FOR TRANSFER OR EXCHANGE
OF RESTRICTED SECURITY
(Transfers Pursuant to Section 2.7(b) or 2.7(c)(v)(E)
of the Indenture)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Institutional Trust Services
Re: Kern River Funding Corporation
6.676% Senior Notes Due 2016 (the "Securities")
Reference is hereby made to the Trust Indenture, dated as of
August 13, 2001 (the "Indenture"), among Kern River Funding Corporation, as
issuer (the "Company") Kern River Gas Transmission Company, as guarantor, and
The Chase Manhattan Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to US$510,000,000 principal amount of
Securities presented or surrendered on the date hereof (the "Surrendered
Securities") which are registered in the name of [Insert Name of Transferor]
(the "Transferor"). The Transferor has requested a transfer of such Surrendered
Securities to a Person other than the Transferor (each such transaction being
referred to herein as a "transfer").
In connection with such request and in respect of such
Surrendered Securities, the Transferor does hereby certify that:
[CHECK ONE]
(a) the Surrendered Securities are being transferred to the Company;
or
(b) the Surrendered Securities are being transferred pursuant to and in
accordance with Rule 144A under the United States Securities Act of 1933 (the
"Securities Act") and, accordingly, the Transferor does hereby further certify
that the Surrendered Securities are being transferred to a Person that the
Transferor reasonably believes is purchasing the Surrendered Securities for its
own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in each case in
a transaction meeting the requirements of Rule 144A and in accordance with any
applicable blue sky or securities laws of any state of the United States;
Page 84
or
(c) the Surrendered Securities are being transferred pursuant to and in
accordance with Regulation S under the Securities Act, and
(i) the offer of the Surrendered Securities was not made
to a person in the United States;
(ii) either:
(A) at the time the buy order was originated, the
transferee was outside the United States or the
Transferor and any person acting on its behalf
reasonably believed and believes that the transferee
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 the Transferor nor any person acting on
its behalf knows that the transaction was prearranged
with a buyer in the United States;
(iii) no directed selling efforts have been made in con-
travention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable; and
(iv) the transaction is not part of a plan or scheme to
evade the registration requirements of the Securities
Act;
(d) the Surrendered Securities are being transferred in a transaction
permitted by Rule 144 under the Securities Act and in accordance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the underwriters and initial
purchasers, if any, of the Securities being transferred. Terms used in this
certificate and not otherwise defined in the Indenture have the meanings set
forth in Regulation S under the Securities Act.
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated: _____________, ____
cc: Kern River Funding Corporation
Page 85
EXHIBIT E
Form of Letter to be Delivered by Accredited Investors
Kern River Funding Corporation
Xxx Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Credit Suisse First Boston Corporation,
as representative of the several Purchasers
c/o Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Dear Sirs:
We are delivering this letter in connection with an offering of
$510,000,000 6.676% Senior Notes Due 2016 (the "Securities") of Kern River
Funding Corporation, a Delaware corporation (the "Company"), all as described in
the Confidential Offering Circular (the "Offering Circular") relating to the
offering.
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of Rule
501(a)(1), (2) or (3) under the Securities Act of 1933, as
amended (the "Securities Act"), or an entity in which all of
the equity owners are accredited investors within the meaning
of Rule 501(a)(1), (2) or (3) under the Securities Act (an
"Institutional Accredited Investor");
(ii) (A) any purchase of the Securities by us will be for our own
account or for the account of one or more other Institutional
Accredited Investors or as fiduciary for the account of one or
more trusts, each of which is an "accredited investor" within
the meaning of Rule 501(a)(7) under the Securities Act and for
each of which we exercise sole investment discretion or (B) we
are a "bank", within the meaning of Section 3(a)(2) of the
Securities Act, or a "savings and loan association" or other
institution described in Section 3(a)(5)(A) of the Securities
Act that is acquiring the Securities as fiduciary for the
account of one or more institutions for which we exercise sole
investment discretion,
(iii) in the event that we purchase any of the Securities, we will
acquire Securities having a minimum purchase price of not less
than $100,000 for our own account or for any separate account
for which we are acting;
(iv) we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits
and risks of purchasing the Securities;
(v) we are not acquiring the Securities with a view to
distribution thereof or with any present intention of offering
or selling any of the Securities, except inside the United
States in accordance with Rule 144A under the Securities Act
or outside the United States under Regulation S under the
Securities Act, as provided below; provided that the
disposition of our property and the property of any accounts
for which we are acting as fiduciary shall remain at all times
within our control; and
(vi) we have received a copy of the Offering Circular relating to
the offering of the Securities and acknowledge that we have
had access to financial and other information, and have been
afforded the opportunity to ask questions of representatives
of the Company and receive answers thereto, as we deem
necessary in connection with our decision to purchase the
Securities.
We understand that the Securities are being offered in a transaction
not involving any public offering within the United States within the meaning of
the Securities Act and that the Securities have not been registered under the
Securities Act, and we agree, on our own behalf and on behalf of each account
for which we acquire any Securities, that if in the future we decide to resell,
pledge or otherwise transfer the Securities, the Securities may be offered,
Page 86
resold, pledged or otherwise transferred only (i) in the United States to a
person who we reasonably believe 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 a transaction in
accordance with Rule 904 under the Securities Act, (iii) under an exemption from
registration under the Securities Act provided by Rule 144 thereunder (if
available) or (iv) under an effective registration statement under the
Securities Act, in each of cases (i) through (iv), subject to any applicable
securities laws of any State of the United States or any other applicable
jurisdiction. We understand that the registrar and transfer agent for the
Securities, will not be required to accept for registration of transfer any
Securities acquired by us, except upon presentation of evidence satisfactory to
the Company and the transfer agent that the foregoing restrictions on transfer
have been complied with. We further understand that any Securities acquired by
us, will be in the form of definitive physical certificates and that the
certificates will bear a legend reflecting the substance of this paragraph.
We acknowledge that you, the Company and others will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.
Date:__________________________ _________________________________________
(Name of Purchaser)
By:______________________________________
Name:
Title:
Address:
Page 87
