FIRST SUPPLEMENTAL TRUST INDENTURE
Exhibit
99.2
This
First Supplemental Trust Indenture is entered into as of the 15th day of June,
2004.
AMONG:
ACCLAIM
ENERGY TRUST, an open
ended trust governed under the laws of the Province of Alberta and having its
head office in the City of Calgary, in the Province of Alberta (hereinafter
called the "Trust")
AND
ACCLAIM
ENERGY INC., a
corporation existing under the laws of the Province of Alberta and having its
head office in the City of Calgary, in the Province of Alberta (hereinafter
called "Acclaim Energy"
or the "Corporation")
AND
COMPUTERSHARE
TRUST COMPANY OF
CANADA, a trust company incorporated under the federal laws of Canada
having an office in the City of Calgary, in the Province of Alberta (hereinafter
called the "Debenture
Trustee")
WITNESSETH
THAT:
WHEREAS
the Trust, the Corporation and the Debenture Trustee entered into an indenture
(the "Indenture") dated
December 17, 2002 to provide for the creation and issuance of debentures
for the Trust's investment purposes;
AND
WHEREAS Article 16 of the Indenture provides that the Debenture Trustee and
the Trust may enter into indentures supplemental to the Indenture;
AND
WHEREAS the Trust has determined to create and issue a second series of
debentures being 8.0% convertible extendible unsecured subordinated debentures
(the "Debentures") due
August 31, 2009, or, in certain circumstances, August 31, 2004, and to enter
into this first supplemental indenture (this "Supplemental Indenture") with
the Debenture Trustee to provide for such creation and issuance of
Debentures;
AND
WHEREAS all necessary acts and proceedings have been done and taken and all
necessary resolutions have been passed to authorize the execution and delivery
of this Supplemental Indenture, to make the same effective and binding upon
the
Trust, and to make the Debentures, when authenticated or certified by the
Debenture Trustee and issued as provided in the Indenture and this Supplemental
Indenture, valid, binding and legal obligations of the Trust with the benefit
and subject to the terms of the Indenture and this Supplemental
Indenture;
AND
WHEREAS the foregoing recitals are made as representations and statements of
fact by the Trust and not by the Debenture Trustee;
NOW
THEREFORE it is hereby covenanted, agreed and declared as follows:
ARTICLE 1
DEFINITIONS
AND AMENDMENTS TO INDENTURE
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1.1
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Definitions
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All
capitalized terms not defined herein shall have the meanings given to them
in
the Indenture and, in addition, in this Supplemental Indenture and in the
Debentures, unless there is something in the subject matter or context
inconsistent therewith, the expressions following shall have the following
meanings, namely:
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(a)
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"Acclaim
LP" means
Acclaim Limited Partnership, an indirect wholly owned subsidiary
of the
Trust formed under the laws of the Province of Alberta;
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(b)
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"Chevron
Acquisition"
means the acquisition by the Trust of certain petroleum and natural
gas
properties and related assets from Chevron Canada pursuant to the
Chevron
Acquisition Agreements;
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(c)
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"Chevron
Acquisition
Agreements" means, collectively,
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(i)
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the
partnership purchase and sale agreement dated May 25, 2004 among
Chevron
Canada, as vendor, and Acclaim LP and Enerplus Commercial Trust,
as
purchasers;
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(ii)
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the
Acheson Gas Plant purchase and sale agreement dated May 25, 2004
between
Chevron Canada Limited, as vendor, and Acclaim Processing Co. Ltd.,
as
purchaser; and
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(iii)
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the
Manitoba Royalties purchase and sale agreement dated May 25, 2004
among
Chevron Canada Limited, as vendor, and Acclaim LP and Enerplus Commercial
Trust, as purchasers pursuant to which Acclaim LP and Acclaim Processing
Co. Ltd. have agreed (jointly with Enerplus Commercial Trust with
respect
to certain properties and assets) to purchase petroleum and natural
gas
properties and related assets from Chevron Canada;
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(d)
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"Chevron
Acquisition
Date" means the date upon which the closing of the Chevron
Acquisition takes place, and "Chevron Acquisition
Time" means the time on the Chevron Acquisition Date at which
the
closing of the Chevron Acquisition takes place;
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(e)
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"Chevron
Canada" means,
collectively, Chevron Canada Limited and Chevron Canada Resources,
as
vendor of the Chevron Properties;
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(f)
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"Chevron
Properties"
means those petroleum and natural gas properties and related assets
that
the Trust will own following completion of the Transaction, as described
in more detail in the Prospectus under the heading "Information Concerning
the Chevron Properties";
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(g)
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"Concurrent
Disposition"
means the sale of certain of the petroleum and natural gas properties
and
related assets acquired by Enerplus from Chevron Canada to Paramount
immediately following their acquisition by Enerplus from Chevron
Canada;
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(h)
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"Enerplus"
means Enerplus
Commercial Trust, a wholly owned subsidiary of Enerplus Resources
Fund;
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"Paramount"
means
Paramount Resources Ltd. the purchaser, pursuant to the Concurrent
Disposition, of certain of the petroleum and natural gas properties
and
related assets from Enerplus immediately following their acquisition
from
Chevron Canada;
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(j)
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"Prospectus"
means the
short form prospectus of the Trust dated June 3, 2004 qualifying for
distribution the Debentures contemplated herein;
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(k)
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"Termination
Time" means
the earlier to occur of (i) 5:00 p.m. (Calgary time) on August 31,
2004 if
the closing of the Chevron Acquisition has not taken place by that
time,
and (ii) the date upon which the Chevron Acquisition is terminated
or the
Trust has advised the Underwriters or announced to the public that
it does
not intend to proceed with the Chevron Acquisition;
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(l)
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"Transaction"
means,
collectively, the Chevron Acquisition and the Concurrent Disposition;
and
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(m)
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"Underwriters"
means,
collectively, BMO Xxxxxxx Xxxxx Inc., TD Securities Inc., CIBC World
Markets Inc., National Bank Financial Inc., Scotia Capital Inc.,
RBC
Dominion Securities Inc., FirstEnergy Capital Corp., Canaccord Capital
Corporation, Xxxxxxx Xxxxx Ltd., Desjardins Securities Inc. and Dundee
Securities Corporation.
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1.2
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Amendments
to Indenture
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This
Supplemental Indenture is supplemental to the Indenture and the Indenture and
this Supplemental Indenture shall hereafter be read together and shall have
effect, so far as practicable, with respect to the Debentures as if all the
provisions of the Indenture and this Supplemental Indenture were contained
in
one instrument. The Indenture is and shall remain in full force and
effect with regards to all matters governing the Initial Debentures and with
regards to all matters governing the Debentures, except as the Indenture is
amended, superceded, modified or supplemented by this Supplemental
Indenture. Any references in the text of this Supplemental Indenture
to section numbers, article numbers, "hereto", "herein", "hereby", "hereunder",
"hereof" and similar expressions refer to the Indenture unless otherwise
qualified.
ARTICLE 2
THE
DEBENTURES
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2.1
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Form
and Terms of Debentures
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(a)
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The
second series of debentures authorized for issue are limited to an
aggregate principal amount of $75,000,000 and shall be designated
as "8.0%
Convertible Extendible Unsecured Subordinated Debentures".
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(b)
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The
Debentures shall be dated June 15, 2004, and shall bear interest
from such
date at the rate of 8.0% per annum, payable in semi-annual payments
on
February 28 and August 31 in each year, the first such payment to
fall
due, subject as hereinafter provided, on February 28, 2005 and the
last
such payment (representing interest payable from the last Interest
Payment
Date to, but excluding, the Maturity Date of the Initial Debentures),
subject as hereinafter provided, to fall due on August 31, 2009,
payable
after as well as before maturity and after as well as before default,
with
interest on amounts in default at the same rate, compounded semi-annually.
For certainty, subject to adjustment as hereinafter provided, the
first
interest payment will include interest accrued from June 15, 2004
to, but
excluding, February 28, 2005, which will be equal to $56.54 for each
$1,000 principal amount of the Debentures. The Debentures will mature
on
August 31, 2009, provided that if the closing of the Chevron Acquisition
does not take place by 5:00 p.m.
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(Calgary
time) on August 31, 2004, if the Chevron Acquisition is terminated
at any
earlier time or if the Trust has advised the Underwriters or announced
to
the public that it does not intend to proceed with the Chevron
Acquisition, the Debentures will mature on August 31, 2004. If the
Chevron
Acquisition takes place prior to 5:00 p.m. (Calgary time) on August
31,
2004, the Maturity Date of the Debentures will be automatically extended
from August 31, 2004 to August 31, 2009 without any further act or
formality on the part of the Trust or the Debenture Trustee. The
Trust
will announce by press release the closing of the Chevron Acquisition
or
the Termination Time, as the case may be, and confirmation of the
Maturity
Date and will provide a copy thereof to the Debenture Trustee in
accordance with Section 14.3.
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(c)
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The
Debentures will be redeemable in accordance with the terms of Article
4,
provided that the Debentures will not be redeemable on or before
August
31, 2007, except in the event of the satisfaction of certain conditions
after a Change of Control has occurred as outlined herein. Subsequent
to
August 31, 2007 and on or prior to August 31, 2008, the Debentures
may be
redeemed at the option of the Trust in whole or in part from time
to time
on notice as provided for in Section 4.3 at a price equal to $1,050
per
$1,000 principal amount of Debenture plus accrued and unpaid interest.
After August 31, 2008, the Debentures will be redeemable prior to
maturity
in whole or in part from time to time at the option of the Trust
on notice
as provided for in Section 4.3 hereof at a price equal to $1,025
per
$1,000 principal amount of Debenture plus accrued and unpaid interest.
The
Redemption Notice for the Debentures shall be substantially in the
form of
Schedule
B. In connection with the redemption of the Debentures,
the Trust may, at its option and subject to the provisions of Section
4.6
and subject to regulatory approval, elect to satisfy its obligation
to pay
all or a portion of the aggregate principal amount of the Debentures
to be
redeemed by issuing and delivering to the holders of such Debentures,
Freely Tradeable Trust Units. If the Trust elects to exercise
such option, it shall so specify and provide details in the Redemption
Notice. Interest accrued and unpaid on the Debentures on the
Redemption Date will be paid to holders of Debentures, in cash, in
the
manner contemplated in Section 4.5.
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(d)
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The
Debentures will be subordinated to the Senior Indebtedness of the
Trust in
accordance with the provisions of Article 5.
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(e)
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Upon
and subject to the provisions and conditions of Article 6, the holder
of
each Debenture shall have the right at such holder's option, at any
time
prior to the close of business on the earlier of August 31, 2004
or August
31, 2009, as applicable, and the last Business Day immediately preceding
the date specified by the Trust for redemption of the Debentures
by notice
to the holders of Debentures in accordance with Sections 2.4(c) and
4.3
(the earlier of which will be the "Time of Expiry" for the
purposes of Article 6 in respect of the Debentures), to convert the
whole
or, in the case of a Debenture of a denomination in excess of $1,000,
any
part which is $1,000 or an integral multiple thereof, of the principal
amount of a Debenture into Trust Units at the Conversion Price in
effect
on the Date of Conversion (as defined in Section 6.4(b)).
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The
Conversion Price in effect on the date hereof for each Trust Unit to be issued
upon the conversion of Debentures shall be equal to $13.50 such that
approximately 74.0741 Trust Units shall be issued for each $1,000 principal
amount of Debentures so converted. No adjustment in the number of Trust Units
to
be issued upon conversion will be made for distributions or dividends on Trust
Units issuable upon conversion or for interest accrued on Debentures surrendered
for conversion. The Conversion Price applicable to and the Trust
Units, securities or other property receivable on the conversion of the
Debentures is subject to adjustment pursuant to the provisions of Section
6.5.
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On
maturity of the Debentures, the Trust may, at its option and upon
and
subject to the terms of Section 4.10 and subject to regulatory approval,
elect to satisfy its obligation to pay all or a portion of the aggregate
principal amount of the Debentures due on maturity by issuing and
delivering to such holders of Debentures Freely Tradable Trust Units.
If
the Trust elects to exercise such option, it shall deliver a maturity
notice (the "Maturity
Notice") to the holders of the Debentures in the form of Schedule
C and provide
the necessary details. Interest accrued and unpaid on the
Debentures on the maturity date will be paid to holders of Debentures
in
cash.
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(g)
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The
Debentures shall be issued only in denominations of $1,000 and integral
multiples of $1,000. Each Debenture and the certificate of the Debenture
Trustee endorsed thereon shall be issued in substantially the form
set out
in Schedule A,
with such insertions, omissions, substitutions or other variations
as
shall be required or permitted by the Indenture, and may have imprinted
or
otherwise reproduced thereon such legend or legends or endorsements,
not
inconsistent with the provisions of the Indenture, as may be required
to
comply with any law or with any rules or regulations pursuant thereto
or
with any rules or regulations of any securities exchange or securities
regulatory authority or to conform with general usage, all as may
be
determined by the directors of Acclaim Energy (on behalf of the Trust)
executing such Debenture in accordance with Section 2.7, as conclusively
evidenced by their execution of a Debenture. Each Debenture
shall additionally bear such distinguishing letters and numbers as
the
Debenture Trustee shall approve. Notwithstanding the foregoing, a
Debenture may be in such other form or forms as may, from time to
time,
be, approved by a resolution of the directors of Acclaim Energy,
on behalf
of the Trust or as specified in an Officer's Certificate. The
Debentures may be engraved, lithographed, printed, mimeographed or
typewritten or partly in one form and partly in another.
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(h)
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The
Debentures shall be issued as Global Debentures and the Global Debentures
will be registered in the name of the Depositary which, as of the
date
hereof, shall be The Canadian Depositary for Securities Limited (or
any
nominee of the Depositary). No beneficial holder will receive definitive
certificates representing their interest in Debentures except as
provided
in Section 3.2. A Global Debenture may be exchanged for Debentures
in
registered form that are not Global Debentures, or transferred to
and
registered in the name of a person other than the Depository for
such
Global Debentures or a nominee thereof as provided in Section 3.2.
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(i)
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Upon
and subject to the terms and conditions of Article 10, the Trust
may
elect, from time to time, to satisfy its Interest Obligation on the
Debentures on any Interest Payment Date (or on redemption or maturity)
by
delivering Trust Units to the Debenture Trustee.
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(j)
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Within
30 days following the occurrence of a Change of Control, and subject
to
the provisions and conditions of Section 2.4(i), the Trust shall
be
obligated to offer to purchase the Debentures. The terms and conditions
of
such obligation are set forth below:
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(i)
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Within
30 days following the occurrence of a Change of Control, the Trust
shall
deliver to the Debenture Trustee, and the Debenture Trustee shall
promptly
deliver to the holders of the Debentures, a notice stating that there
has
been a Change of Control and specifying the circumstances surrounding
such
event (a "Change of
Control Notice") together with an offer in writing (the "Offer")
to purchase all
then outstanding Debentures made in accordance with the requirements
of
Applicable Securities Legislation at a price equal to 101% of the
principal amount thereof (the "Offer Price") plus
accrued and unpaid interest on such Debentures up to, but excluding,
the
date of acquisition by the Trust or a related party of such Debentures
(collectively, the "Total
Offer Price").
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5
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If
90% or more in aggregate principal amount of Debentures outstanding
on the
date the Trust provides the Change of Control Notice and the Offer
to
holders of the Debentures have been tendered for purchase pursuant
to the
Offer on the expiration thereof, the Trust has the right and obligation
upon written notice provided to the Debenture Trustee within 10 days
following the expiration of the Offer, to redeem and shall redeem
all the
Debentures remaining outstanding on the expiration of the Offer at
the
Total Offer Price (the "90% Redemption
Right").
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(iii)
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Upon
receipt of notice that the Trust has exercised or is exercising the
90%
Redemption Right and is acquiring the remaining Debentures, the Debenture
Trustee shall promptly provide written notice to each Debentureholder
that
did not previously accept the Offer that:
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(A)
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the
Trust has exercised the 90% Redemption Right and is purchasing all
outstanding Debentures effective on the expiry of the Offer at the
Total
Offer Price, and shall include a calculation of the amount payable
to such
holder as payment of the Total Offer Price;
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(B)
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each
such holder must transfer their Debentures to the Debenture Trustee
on the
same terms as those holders that accepted the Offer and must send
their
respective Debentures, duly endorsed for transfer, to the Debenture
Trustee within 10 days after the sending of such notice; and
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(C)
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the
rights of such holder under the terms of the Debentures and the Indenture
cease effective as of the date of expiry of the Offer provided the
Trust
has, on or before the time of notifying the Debenture Trustee of
the
exercise of the 90% Redemption Right, paid the Total Offer Price
to, or to
the order of, the Debenture Trustee and thereafter the Debentures
shall
not be considered to be outstanding and the holder shall not have
any
right except to receive such holder's Total Offer Price upon surrender
and
delivery of such holder's Debentures in accordance with the Indenture.
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(iv)
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The
Trust shall, on or before 11:00 a.m. (Calgary Time), on the Business
Day
immediately prior to the expiry of the Offer, deposit with the Debenture
Trustee or any paying agent to the order of the Debenture Trustee,
such
sums of money as may be sufficient to pay the Total Offer Price of
the
Debentures to be purchased or redeemed by the Trust on the expiry
of the
Offer, provided the Trust may elect to satisfy this requirement by
providing the Debenture Trustee with a cheque for such amounts required
under Section 2.4(i)(iv) post-dated to the date of expiry of the
Offer.
The Trust shall also deposit with the Debenture Trustee a sum of
money
sufficient to pay any charges or expenses which may be incurred by
the
Debenture Trustee in connection with such purchase and/or redemption,
as
the case may be. Every such deposit shall be irrevocable. From the
sums so
deposited, the Debenture Trustee shall pay or cause to be paid to
the
holders of such Debentures, the Offer Price, and all accrued and
unpaid
interest, if any, to which they are entitled on the Trust's purchase
or
redemption.
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(v)
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In
the event that one or more of such Debentures being purchased in
accordance with Section 2.4(i) becomes subject to purchase in part
only,
upon surrender of such Debentures for payment of the Total Offer
Price,
the Trust shall execute and the Debenture Trustee shall certify and
deliver without charge to the holder thereof or upon
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the
holder's order, one or more new Debentures for the portion of the
principal amount of the Debentures not purchased.
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(vi)
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Debentures
for which holders have accepted the Offer and Debentures which the
Trust
has elected to redeem in accordance with Section 2.4(i) shall become
due
and payable at the Total Offer Price on the date of expiry of the
Offer,
in the same manner and with the same effect as if it were the date
of
maturity specified in such Debentures, anything therein or herein
to the
contrary notwithstanding, and from and after such date of expiry
of the
Offer, if the money necessary to purchase or redeem the Debentures
shall
have been deposited as provided in Section 2.4(i) and affidavits
or other
proofs satisfactory to the Debenture Trustee as to the publication
and/or
mailing of such notices shall have been lodged with it, interest
on the
Debentures shall cease. If any question shall arise as to whether
any
notice has been given as above provided and such deposit made, such
question shall be decided by the Debenture Trustee whose decision
shall be
final and binding upon all parties in interest.
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(vii)
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In
case the holder of any Debenture to be purchased or redeemed in accordance
with Section 2.4(i) shall fail on or before the date of expiry of
the
Offer so to surrender such holder's Debenture or shall not within
such
time accept payment of the moneys payable, or give such receipt therefor,
if any, as the Debenture Trustee may require, such moneys may be
set aside
in trust, either in the deposit department of the Debenture Trustee
or in
a chartered bank, and such setting aside shall for all purposes be
deemed
a payment to the Debentureholder of the sum so set aside and the
Debentureholder shall have no other right except to receive payment
of the
moneys so paid and deposited, upon surrender and delivery up of such
holder's Debenture. In the event that any money required to be deposited
hereunder with the Debenture Trustee or any depository or paying
agent on
account of principal, premium, if any, or interest, if any, on Debentures
issued hereunder shall remain so deposited for a period of six years
from
the date of expiry of the Offer, then such moneys, together with
any
accumulated interest thereon, shall at the end of such period be
paid over
or delivered over by the Debenture Trustee or such depository or
paying
agent to the Trust and the Debenture Trustee shall not be responsible
to
Debentureholders for any amounts owing to them. Notwithstanding the
foregoing, the Debenture Trustee will pay any remaining funds deposited
hereunder prior to the expiry of six years after the date of expiry
of the
Offer to the Trust upon receipt from the Trust, or one of its
Subsidiaries, of an unconditional letter of credit from a Canadian
chartered bank in an amount equal to or in excess of the amount of
the
remaining funds. If the remaining funds are paid to the Trust prior
to the
expiry of six years after the date of expiry of the Offer, the Trust
shall
reimburse the Debenture Trustee for any amounts required to be paid
by the
Debenture Trustee to a holder of a Debenture pursuant to the Offer
after
the date of such payment of the remaining funds to the Trust but
prior to
six years after the date of expiry of the Offer.
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(viii)
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Subject
to the provisions above related to Debentures purchased in part,
all
Debentures redeemed and paid under Section 2.4(i) shall forthwith
be
delivered to the Debenture Trustee and cancelled and no Debentures
shall
be issued in substitution therefor.
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(k)
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The
Debenture Trustee shall be provided with the documents and instruments
referred to in Sections 2.5(b), (c) and (d) with respect to the
Debentures prior to the issuance of the Debentures.
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7
ADDITIONAL
MATTERS
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3.1
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Confirmation
of Indenture
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The
Debenture, as amended and supplemented by this Supplemental Indenture, is in
all
respects confirmed.
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3.2
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Acceptance
of Trusts
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The
Debenture Trustee hereby accepts the trusts in this Supplemental Indenture
declared and provided for and agrees to perform the same upon the terms and
conditions and subject to the provisions set forth in the Indenture.
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3.3
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Governing
Law
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This
Supplemental Indenture shall be construed in accordance with the laws of the
Province of Alberta and the laws of Canada applicable therein and shall be
treated, in all respects, as an Alberta contract.
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3.4
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Further
Assurances
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The
parties shall, with reasonable diligence, do all such things and provide all
such reasonable assurances as may be required to consummate the transactions
contemplated by this Supplemental Indenture, and each party shall provide such
further documents or instruments required by the other party as may be
reasonably necessary or desirable to effect the purpose of this Supplemental
Indenture and carry out its provisions.
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3.5
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Counterparts
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This
Supplemental Indenture may be executed by the parties in separate counterparts
each of which when so executed and delivered shall be an original, but all
such
counterparts shall together constitute one and the same instrument.
IN
WITNESS WHEREOF the parties hereto have executed these presents under their
respective corporate seals and the hands of their proper officers in that
behalf.
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ACCLAIM
ENERGY TRUST, by
its attorney,
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ACCLAIM
ENERGY INC.
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By:
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(signed)
"J. Xxxx
Xxxxxxx"
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J.
Xxxx Xxxxxxx
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President
and Chief Executive Officer
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ACCLAIM
ENERGY INC.
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By:
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(signed)
"J. Xxxx
Xxxxxxx"
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J.
Xxxx Xxxxxxx
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President
and Chief Executive Officer
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8
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(signed)
"Xxxxx X.
Broshko"
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Xxxxx
X. Broshko
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Vice
President and Chief Financial Officer
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COMPUTERSHARE
TRUST COMPANY OF
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CANADA
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By:
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(signed)
"Authorized
Signatory"
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By:
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(signed)
" Authorized
Signatory "
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9
TO
THE FIRST SUPPLEMENTAL TRUST INDENTURE AMONG
ACCLAIM
ENERGY TRUST, ACCLAIM ENERGY INC. AND
COMPUTERSHARE
TRUST COMPANY OF CANADA
FORM
OF DEBENTURE
SCHEDULE
"A"
This
Debenture is a Global Debenture within the meaning of the Indenture herein
referred to and is registered in the name of a Depository or a nominee thereof.
This Debenture may not be transferred to or exchanged for Debentures registered
in the name of any person other than the Depository or a nominee thereof and
no
such transfer may be registered except in the limited circumstances described
in
the Indenture. Every Debenture authenticated and delivered upon registration
of,
transfer of, or in exchange for, or in lieu of, this Debenture shall be a Global
Debenture subject to the foregoing, except in such limited circumstances
described in the Indenture.
Unless
this certificate is presented by an authorized representative of The Canadian
Depository for Securities Limited ("CDS") to the Issuer or its agent for
registration of transfer, exchange or payment, and any certificate issued in
respect thereof is registered in the name of CDS & CO., or in such other
name as is requested by an authorized representative of CDS (and any payment
is
made to CDS & CO. or to such other entity as is requested by an authorized
representative of CDS), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered holder hereof,
CDS & CO. has an interest herein.
CUSIP
[00433BAB86/00433BAC63]
|
No.S1
|
$•
|
ACCLAIM
ENERGY TRUST
(A
trust governed by the laws of Alberta)
8.0%
CONVERTIBLE EXTENDIBLE UNSECURED SUBORDINATED DEBENTURE
DUE
AUGUST 31, 2004
(AUGUST
31, 2009, IF EXTENDED)
ACCLAIM
ENERGY TRUST (the
"Trust") for value
received hereby acknowledges itself indebted and, subject to the provisions
of
the trust indenture (the "Indenture") dated as of
December 17, 2002, as supplemented by the first supplemental indenture (the
"Supplemental
Indenture") dated as of June 15, 2004, among the Trust, Acclaim
Energy Inc. and Computershare Trust Company of Canada (the "Debenture Trustee"), promises
to pay to the registered holder hereof on August 31, 2009 (the "Maturity Date") or on such
earlier date as the principal amount hereof may become due in accordance with
the provisions of the Supplemental Indenture the principal sum of • Dollars ($•)
in lawful money of Canada on presentation and surrender of this Debenture (as
defined herein) at the main branch of the Debenture Trustee in Calgary, Alberta
or Toronto, Ontario in accordance with the terms of the Indenture and the
Supplemental Indenture and, subject as hereinafter provided, to pay interest
on
the principal amount hereof from the date hereof, or from the last Interest
Payment Date to which interest shall have been paid or made available for
payment on the outstanding Debentures, whichever is later, at the rate of 8.0%
per annum, in like money, in arrears in semi-annual instalments (less any tax
required by law to be deducted) on February 28 and August 31 in each
year commencing on February 28, 2005 and, should the Trust at any time make
default in the payment of any principal or interest, to pay interest on the
amount in default at the same rate, in like money and on the same
dates. For certainty, subject to adjustment as hereinafter provided,
the first interest payment will include interest accrued from June 15, 2004
to,
but excluding, February 28, 2005, which will be equal to $56.54 for each $1,000
principal amount of the Debentures. The Debentures will mature on
August 31, 2009, provided that if the closing of the Chevron Acquisition does
not take place by 5:00 p.m. (Calgary time) on August 31, 2004, if the Chevron
Acquisition is terminated at any earlier time or if the Trust has advised the
Underwriters
or announced to the public that it does not intend to proceed with the Chevron
Acquisition, the Debentures will mature on August 31, 2004. If the
Chevron Acquisition takes place prior to 5:00 p.m. (Calgary time) on August
31,
2004, the Maturity Date of the Debentures will be automatically extended from
August 31, 2004 to August 31, 2009 without any further act or formality on
the
part of the Trust or the Debenture Trustee.
Interest
hereon shall be payable by cheque mailed by prepaid ordinary mail or by
electronic transfer of funds to the registered holder hereof and, subject to
the
provisions of the Indenture, the mailing of such cheque or the electronic
transfer of such funds shall, to the extent of the sum represented thereby
(plus
the amount of any tax withheld), satisfy and discharge all liability for
interest on this Debenture.
This
Debenture is one of the 8.0% Convertible Unsecured Subordinated Debentures,
due
on the Maturity Date (referred to herein as the "Debenture") of the Trust
issued or issuable under the provisions of the Indenture. The
Debentures authorized for issue are limited to an aggregate principal amount
of
$75,000,000 in lawful money of Canada. Reference is hereby expressly
made to the Supplemental Indenture for a description of the terms and conditions
upon which the Debentures are or are to be issued and held and the rights and
remedies of the holders of the Debentures and of the Trust and of the Debenture
Trustee, all to the same effect as if the provisions of the Supplemental
Indenture were herein set forth to all of which provisions the holder of this
Debenture by acceptance hereof assents.
The
Debentures are issuable only in denominations of $1,000 and integral multiples
thereof. Upon compliance with the provisions of the Supplemental Indenture,
Debentures of any denomination may be exchanged for an equal aggregate principal
amount of Debentures in any other authorized denomination or
denominations.
The
whole, or if this Debenture is in a denomination in excess of $1,000, any part
which is $1,000 or an integral multiple thereof, of the principal of this
Debenture is convertible, at the option of the holder hereof, upon surrender
of
this Debenture at the principal office of the Debenture Trustee in Calgary,
Alberta or Toronto, Ontario, at any time prior to the close of business on
the
earlier of August 31, 2004 or August 31, 2009, as applicable, and the last
Business Day immediately preceding the date specified by the Trust for
redemption of the Debentures, into Trust Units (without adjustment for interest
accrued hereon or for dividends or distributions on Trust Units issuable upon
conversion) at a conversion price of $13.50 (the "Conversion Price") per Trust
Unit, being a rate of approximately 74.071 Trust Units for each $1,000 principal
amount of Debentures, all subject to the terms and conditions and in the manner
set forth in the Supplemental Indenture. The Supplemental Indenture
makes provision for the adjustment of the Conversion Price in the events therein
specified. No fractional Trust Units will be issued on any conversion but in
lieu thereof, the Trust will satisfy such fractional interest by a cash payment
equal to the market price of such fractional interest determined in accordance
with the Supplemental Indenture. No adjustment in the number of Trust
Units to be issued upon conversion will be made for distributions or dividends
on Trust Units issuable upon conversion or for interest accrued on Debentures
surrendered for conversion.
This
Debenture will be redeemed at the option of the Trust on the terms and
conditions set out in the Supplemental Indenture at the redemption price therein
and herein set out provided that this Debenture is not redeemable on or before
August 31, 2007, except in the event of the satisfaction of certain
conditions after a Change of Control has occurred. After
August 31, 2007 and on or prior to August 31, 2008, the Debentures may be
redeemed at the option of the Trust in whole or in part from time to time on
notice as provided for in the Indenture at a price equal to $1,050 per $1,000
principal amount of Debenture plus accrued and unpaid interest. After
August 31, 2008, the Debentures will be redeemable prior to maturity in
whole or in part from time to time at the option of the Trust on notice as
provided for
A-2
in
the Indenture at a price equal to $1,025 per $1,000 principal amount of
Debenture plus accrued and unpaid interest. The Trust may, on notice as provided
in the Supplemental Indenture, at its option and subject to any applicable
regulatory approval, elect to satisfy its obligation to pay all or any portion
of the applicable Redemption Price by the issue of that number of Trust Units
obtained by dividing the applicable Redemption Price by 95% of the weighted
average trading price of the Trust Units on the Toronto Stock Exchange for
the
20 consecutive trading days ending on the fifth trading day preceding the
Redemption Date.
Upon
the occurrence of a Change of Control of the Trust, the Trust is required to
make an offer to purchase all of the Debentures at a price equal to 101% of
the
principal amount of such Debentures plus accrued and unpaid interest up to,
but
excluding, the date the Debentures are so repurchased (the "Offer"). If 90% or
more of the principal amount of all Debentures outstanding on the date the
Trust
provides notice of a Change of Control to the Debenture Trustee have been
tendered for purchase pursuant to the Offer, the Trust has the right to redeem
and shall redeem all the remaining outstanding Debentures on the same date
and
at the same price.
If
a takeover bid for Debentures, within the meaning of the Securities Act (Alberta), is
made and 90% or more of the principal amount of all the Debentures (other than
Debentures held at the date of the takeover bid by or on behalf of the Offeror,
Associates or Affiliates of the Offeror or anyone acting jointly or in concert
with the Offeror) are taken up and paid for by the Offeror, the Offeror will
be
entitled to acquire the Debentures of those holders who did not accept the
offer
on the same terms as the Offeror acquired the first 90% of the principal amount
of the Debentures.
The
Trust may, on notice as provided in the Supplemental Indenture, at its option
and subject to any applicable regulatory approval, elect to satisfy the
obligation to repay all or any portion of the principal amount of this Debenture
due on the Maturity Date by the issue of that number of Freely Tradeable Trust
Units obtained by dividing the principal amount of this Debenture to be paid
for
in Trust Units pursuant to the exercise by the Trust of the Unit Repayment
Right
by 95% of the weighted average trading price of the Trust Units on the Toronto
Stock Exchange for the 20 consecutive trading days ending on the fifth trading
day preceding the Maturity Date.
The
indebtedness evidenced by this Debenture, and by all other Debentures now or
hereafter certified and delivered under the Indenture, is a direct unsecured
obligation of the Trust, and is subordinated in right of payment, to the extent
and in the manner provided in the Indenture, to the prior payment of all Senior
Indebtedness, whether outstanding at the date of the Indenture or thereafter
created, incurred, assumed or guaranteed, provided that the Debentures will
rank
pari passu with
the Debentures.
The
principal hereof may become or be declared due and payable before the stated
maturity in the events, in the manner, with the effect and at the times provided
in the Indenture.
The
Indenture contains provisions making binding upon all holders of Debentures
outstanding thereunder (or in certain circumstances specific series of
Debentures) resolutions passed at meetings of such holders held in accordance
with such provisions and instruments signed by the holders of a specified
majority of Debentures outstanding (or specific series), which resolutions
or
instruments may have the effect of amending the terms of this Debenture or
the
Indenture.
The
Indenture contains provisions disclaiming any personal liability on the part
of
holders of Trust Units, or the trustees, officers or agents of the Trust in
respect of any obligation or claim arising out of the Indenture or this
Debenture.
A-3
This
Debenture may only be transferred, upon compliance with the
conditions prescribed in the Indenture, in one of the registers to be kept
at
the principal office of the Debenture Trustee in Calgary, Alberta or Toronto,
Ontario and in such other place or places and/or by such other registrars (if
any) as the Trust with the approval of the Debenture Trustee may designate.
No
transfer of this Debenture shall be valid unless made on the register by the
registered holder hereof or his executors or administrators or other legal
representatives, or his or their attorney duly appointed by an instrument in
form and substance satisfactory to the Debenture Trustee or other registrar,
and
upon compliance with such reasonable requirements as the Debenture Trustee
and/or other registrar may prescribe and upon surrender of this Debenture for
cancellation.
This
Debenture shall not become obligatory for any purpose until it shall have been
certified by the Debenture Trustee under the Indenture.
Capitalized
words or expressions used in this Debenture shall, unless otherwise defined
herein, have the meaning ascribed thereto in the Indenture and the Supplemental
Indenture.
IN
WITNESS WHEREOF ACCLAIM ENERGY
TRUST has caused this Debenture to be signed by its authorized
representative as of the 15th day of June, 2004.
|
ACCLAIM
ENERGY TRUST, by
its attorney, Acclaim
|
||
|
Energy
Inc.
|
||
|
Per:
|
||
A-4
This
Debenture is one of the 8.0% Convertible Extendible Unsecured Subordinated
Debentures, due August 31, 2004 (August 31, 2009, if extended) referred to
in the Supplemental Indenture within mentioned.
COMPUTERSHARE
TRUST COMPANY OF CANADA
By: ____________________________
(Authorized
Officer)
(FORM
OF REGISTRATION PANEL)
(No
writing hereon except by Debenture Trustee or other registrar)
|
Date
of Registration
|
In
Whose Name Registered
|
Signature
of Debenture Trustee or
Registrar
|
FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
__________________________________, whose address and social insurance number,
if applicable, are set forth below, this Debenture (or $______________ principal
amount hereof*) of ACCLAIM ENERGY TRUST standing in the name(s) of the
undersigned in the register maintained by the Trust with respect to such
Debenture and does hereby irrevocably authorize and direct the Debenture Trustee
to transfer such Debenture in such register, with full power of substitution
in
the premises.
Dated: _________________________________________________________________________________________________________________________________________________________
Address
of Transferee:
____________________________________________________________________________________________________________________________________________
(Xxxxxx
Xxxxxxx, Xxxx, Xxxxxxxx and Postal Code)
Social
Insurance Number of Transferee, if
applicable:
*If
less than the full principal amount of the within Debenture is to be
transferred, indicate in the space provided the principal amount (which must
be
$1,000 or an integral multiple thereof, unless you hold a Debenture in a
non-integral multiple of $1,000, in which case such Debenture is transferable
only in its entirety) to be transferred.
|
1.
|
The
signature(s) to this assignment must correspond with the name(s)
as
written upon the face of this Debenture in every particular without
alteration or any change whatsoever. The signature(s) must be guaranteed
by a Canadian chartered bank or trust company or by a member of an
acceptable Medallion Guarantee Program. Notarized or witnessed signatures
are not acceptable as guaranteed signatures. The Guarantor must affix
a
stamp bearing the actual words: "SIGNATURE GUARANTEED".
|
|
2.
|
The
registered holder of this Debenture is responsible for the payment
of any
documentary, stamp or other transfer taxes that may be payable in
respect
of the transfer of this Debenture.
|
Signature
of Guarantor:
|
Authorized
Officer
|
Signature
of transferring registered holder
|
|
|
Name
of Institution
|
TO
CDS GLOBAL DEBENTURE
ACCLAIM
ENERGY TRUST
8.0%
CONVERTIBLE EXTENDIBLE UNSECURED SUBORDINATED DEBENTURES
DUE
AUGUST 31, 2004 (AUGUST 31, 2009, IF EXTENDED)
|
Initial
Principal Amount: $•
|
CUSIP:
[00433BAB86/00433BAC63]
|
Authorization: ________________________
ADJUSTMENTS
|
Date
|
Amount
of Increase
|
Amount
of Decrease
|
New
Principal Amount
|
Authorization
|
TO
THE FIRST SUPPLEMENTAL TRUST INDENTURE AMONG
ACCLAIM
ENERGY TRUST, ACCLAIM ENERGY INC. AND
COMPUTERSHARE
TRUST COMPANY OF CANADA
FORM
OF REDEMPTION NOTICE
Form
of Redemption Notice
ACCLAIM
ENERGY TRUST
8%
CONVERTIBLE EXTENDIBLE UNSECURED SUBORDINATED DEBENTURES
REDEMPTION
NOTICE
|
To:
|
Holders
of 8% Convertible Extendible Unsecured Subordinated Debentures, (the
"Debentures") of
Acclaim Energy Trust (the "Trust")
|
|
Note:
|
All
capitalized terms used herein have the meaning ascribed thereto in
the
Indenture mentioned below, unless otherwise indicated.
|
Notice
is hereby given pursuant to Section 4.3 of the trust indenture (the "Indenture") dated as of
December 17, 2002 among the Trust, Acclaim Energy Inc. and Computershare
Trust Company of Canada (the "Debenture Trustee") and the
first supplemental trust indenture dated as of June 15, 2004 among the Trust,
Acclaim Energy Inc. and the Debenture Trustee, that the aggregate principal
amount of $• of the $• of Debentures outstanding will be redeemed as of • (the
"Redemption Date"), upon
payment of a redemption amount of $• for each $1,000 principal amount of
Debentures, being equal to the aggregate of (i) $• (the "Redemption Price"), and
(ii) all accrued and unpaid interest hereon to but excluding the Redemption
Date (collectively, the "Total
Redemption Price").
The
Total Redemption Price will be payable upon presentation and surrender of the
Debentures called for redemption at the following corporate trust office:
|
Computershare
Trust Company of Canada
|
|
Xxxxx
000, 000 - 0xx Xxxxxx, XX
|
|
Xxxxxxx
XX X0X 0X0
|
The
interest upon the principal amount of Debentures called for redemption shall
cease to be payable from and after the Redemption Date, unless payment of the
Total Redemption Price shall not be made on presentation for surrender of such
Debentures at the above-mentioned corporate trust office on or after the
Redemption Date or prior to the setting aside of the Total Redemption Price
pursuant to the Indenture.
[Pursuant
to Section 4.6 of the Indenture, the Trust hereby irrevocably elects to
satisfy its obligation to pay $• of the Redemption Price payable to holders of
Debentures in accordance with this notice by issuing and delivering to the
holders that number of Freely Tradable Trust Units obtained by dividing the
Redemption Price by 95% of the Current Market Price of the Trust Units.
No
fractional Trust Units shall be delivered upon the exercise by the Trust of
the
above-mentioned redemption right but, in lieu thereof, the Trust shall pay
the
cash equivalent thereof determined on the basis of the Current Market Price
of
Trust Units on the Redemption Date (less any tax required to be deducted, if
any).
In
this connection, upon presentation and surrender of the Debentures for payment
on the Redemption Date, the Trust shall, on the Redemption Date, make the
delivery to the Debenture Trustee, at the above-mentioned corporate trust
office, for delivery to and on account of the holders, of certificates
representing the Freely Tradable Trust Units to which holders are
entitled
together with the cash equivalent in lieu of fractional Trust Units, cash for
all accrued and unpaid interest up to, but excluding, the
Redemption Date, and, if only a portion of the Debentures are to be redeemed
by
issuing Freely Tradable Trust Units, cash representing the balance of the
Redemption Price.]
DATED:
ACCLAIM
ENERGY TRUST, by its
attorney
Acclaim
Energy Inc.
_____________________________________
(Authorized
Director or Officer of
Acclaim
Energy Inc.)
TO
THE FIRST SUPPLEMENTAL TRUST INDENTURE AMONG
ACCLAIM
ENERGY TRUST, ACCLAIM ENERGY INC. AND
COMPUTERSHARE
TRUST COMPANY OF CANADA
FORM
OF MATURITY NOTICE
Form
of Maturity Notice
ACCLAIM
ENERGY TRUST
8%
CONVERTIBLE EXTENDIBLE UNSECURED SUBORDINATED DEBENTURES
MATURITY
NOTICE
|
To:
|
Holders
of 8% Convertible Extendible Unsecured Subordinated Debentures (the
"Debentures") of Acclaim
Energy Trust (the "Trust")
|
|
Note:
|
All
capitalized terms used herein have the meaning ascribed thereto in
the
Indenture mentioned below, unless otherwise indicated.
|
Notice
is hereby given pursuant to Section 4.10(b) of the trust indenture (the "Indenture") dated as of
December 17, 2002 among the Trust, Acclaim Energy Inc. and
Computershare Trust Company of Canada (the Debenture Trustee") and the
first supplemental trust indenture dated as of June 15, 2004 among the Trust,
Acclaim Energy Inc., and the Debenture Trustee, that the Debentures are due
and
payable as of August 31, 2009 (the "Maturity Date") and the Trust
elects to satisfy its obligation to repay to holders of Debentures the principal
amount of all of the Debentures outstanding on the Maturity Date by issuing
and
delivering to the holders that number of Freely Tradable Trust Units equal
to
the number obtained by dividing such principal amount of the Debentures by
95%
of the Current Market Price of Trust Units on the Maturity Date.
No
fractional Trust Units shall be delivered on exercise by the Trust of the above
mentioned repayment right but, in lieu thereof, the Trust shall pay the cash
equivalent thereof determined on the basis of the Current Market Price of Trust
Units on the Maturity Date (less any tax required to be deducted, if
any).
In
this connection, upon presentation and surrender of the Debentures for payment
on the Maturity Date, the Trust shall, on the Maturity Date, make delivery
to
the Debenture Trustee, at its principal corporate trust office in Calgary,
Alberta, for delivery to and on account of the holders, of certificates
representing the Freely Tradable Trust Units to which holders are entitled
together with the cash equivalent in lieu of fractional Trust Units, cash for
all accrued and unpaid interest up to, but excluding, the Maturity Date and
if
only a portion of the Debentures are to be repaid by issuing Freely Tradable
Trust Units, cash representing the balance of the principal amount and premium
(if any) due on the Maturity Date.
DATED:
ACCLAIM
ENERGY TRUST, by its
attorney
Acclaim
Energy Inc.
____________________________________
(Authorized
Director or Officer of
Acclaim
Energy Inc.)
C-1
TO
THE FIRST SUPPLEMENTAL TRUST INDENTURE AMONG
ACCLAIM
ENERGY TRUST, ACCLAIM ENERGY INC. AND
COMPUTERSHARE
TRUST COMPANY OF CANADA
FORM
OF NOTICE OF CONVERSION
Form
of Notice of Conversion
CONVERSION
NOTICE
|
TO:
|
ACCLAIM
ENERGY TRUST
|
|
Note:
|
All
capitalized terms used herein have the meaning ascribed thereto in
the
Indenture mentioned below, unless otherwise indicated.
|
The
undersigned registered holder of 8% Convertible Extendible Unsecured
Subordinated Debentures bearing Certificate No. • irrevocably elects to convert
such Debentures (or $• principal amount thereof*) in accordance with the terms
of the Supplemental Indenture referred to in such Debentures and tenders
herewith the Debentures, and, if applicable, directs that the Trust Units of
Acclaim Energy Trust issuable upon a conversion be issued and delivered to
the
person indicated below. (If Trust Units are to be issued in the name of a person
other than the holder, all requisite transfer taxes must be tendered by the
undersigned).
|
Dated:
|
|||
|
(Signature
of Registered Holder)
|
|
*
|
If
less than the full principal amount of the Debentures, indicate in
the
space provided the principal amount (which must be $1,000 or integral
multiples thereof).
|
|
NOTE:
|
If
Trust Units are to be issued in the name of a person other than the
holder, the signature must be guaranteed by a chartered bank, a trust
company or by a member of an acceptable Medallion Guarantee Program.
The
Guarantor must affix a stamp bearing the actual words: "SIGNATURE
GUARANTEED".
|
(Print
name in which Trust Units are to be issued, delivered and registered)
Name: _____________________________
__________________________________
(Address)______________________________
(City,
Province and Postal Code)
Name
of guarantor:
Authorized
signature:
D-1
TO
THE FIRST SUPPLEMENTAL TRUST INDENTURE AMONG
ACCLAIM
ENERGY TRUST, ACCLAIM ENERGY INC. AND
COMPUTERSHARE
TRUST COMPANY OF CANADA
FORM
OF DECLARATION FOR REMOVAL OF LEGEND
FORM
OF DECLARATION FOR REMOVAL OF LEGEND
|
TO:
|
Computershare
Trust Company of Canada, as trustee and registrar of the 8% Convertible
Extendible Unsecured Subordinated Debentures and Trust Units of Acclaim
Energy Trust
|
The
undersigned (a) acknowledges that the sale of the securities of Acclaim
Energy Trust (the "Trust") to which this
declaration relates is being made in reliance on Rule 904 of
Regulation S under the United States Securities
Act of
1933, as amended (the "1933 Act") and
(b) certifies that (1) it is not an affiliate of the Trust (as defined
in Rule 405 under the 1933 Act), (2) the offer of such securities was
not made to a person in the United States, and either (A) at the time the
buy order was originated, the buyer was outside the United States, or the seller
and any person acting on its behalf reasonably believe that the buyer was
outside the United States, or (B) the transaction was executed on or
through the facilities of the Toronto Stock Exchange and neither the seller
nor
any person acting on its behalf knows that the transaction has been prearranged
with a buyer in the United States, (3) neither the seller nor any affiliate
of the seller nor any person acting on any of their behalf has engaged or will
engage in any directed selling efforts in the United States in connection with
the offer and sale of such securities, (4) the sale is bona fide and not
for the purpose of "washing off" the resale restrictions imposed because the
securities are "restricted securities" (as such term is defined in
Rule 144(a)(3) under the 1933 Act), (5) the seller does not intend to
replace the securities sold in reliance on Rule 904 of the 1933 Act with
fungible unrestricted securities, and (6) the contemplated sale is not a
transaction, or part of a series of transactions which, although in technical
compliance with Regulation S, is part of a plan or scheme to evade the
registration provisions of the 1933 Act. Terms used herein have the meanings
given to them by Regulation S.
|
Dated:
|
By:
|
|||
|
Name:
|
||||
|
Title:
|
|
|
|
E-1
