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EXHIBIT 4.6
No. CUSIP NO. 283695 BH 6
EL PASO NATURAL GAS COMPANY
4 3/4% SUBORDINATED CONVERTIBLE DEBENTURE DUE 2028
EL PASO NATURAL GAS COMPANY, a Delaware corporation (the "Company,"
which term includes any successor corporation under the Subordinated Indenture
hereinafter referred to), for value received, hereby promises to pay to ___
____________________, as Property Trustee for the El Paso Energy Capital Trust
I, or registered assigns, the principal sum of ________________________________
___________________________________________________________________ or such
greater or lesser principal sums as shall be noted on the Schedule attached
hereto on March 31, 2028 and to pay interest on said principal sum from March
17, 1998 or from the most recent interest payment date (each such date, an
"Interest Payment Date") to which interest has been paid or duly provided for,
quarterly (subject to deferral as set forth herein) in arrears on March 31, June
30, September 30 and December 31 of each year, commencing June 30, 1998, at the
rate of 4 3/4% per annum plus Additional Interest and Additional Sums (as
defined in Section 1.1 of the Subordinated Indenture) if any, until the
principal hereof shall have become due and payable, and on any overdue
principal. The amount of interest payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months. In the event that any date on
which interest is payable on this Security is not a Business Day, then a payment
of the interest payable on such date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect of
any such delay) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day (and without any interest or other payment in respect of any such delay), in
each case with the same force and effect as if made on the date the payment was
originally payable. A "Business Day" shall mean any day other than a day on
which banking institutions in the City of New York are authorized or required by
law or executive order to close. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Subordinated Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities, as defined in the Subordinated
Indenture) is registered at the close of business on the Regular Record Date for
such interest installment, which shall be the close of business on the fifteenth
day of the month of such Interest Payment Date. Any such interest installment
not so punctually paid or duly provided for shall 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 Trustee, notice of which shall be
given to Holders of Securities 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 may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Subordinated Indenture.
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The Company shall have the right at any time during the term of this
Security, from time to time, to extend the interest payment period of such
Security for a period not exceeding 20 consecutive quarters from the date of
issue or the most recent date that interest has been paid or been duly provided
for (an "Extension Period"). During any Extension Period, interest will compound
quarterly and the Company shall have the right to make partial payments of
interest on any Interest Payment Date. At the end of any Extension Period the
Company shall pay all interest then accrued and unpaid (together with Additional
Interest thereon to the extent that payment of such interest is permitted by
applicable law and Additional Sums, if any) to the Holder(s) in whose names the
Securities are registered on the Regular Record Date preceding the end of the
Extension Period. "Additional Interest" means interest that shall accrue on any
interest on the Securities that is in arrears for more than one quarter or not
paid during an Extension Period, which in either case shall accrue at the rate
per annum borne by this Security compounded quarterly. Prior to the termination
of any such Extension Period, the Company may further extend the interest
payment period, provided that such Extension Period together with all such
previous and further extensions thereof shall not exceed 20 consecutive quarters
or extend beyond the Maturity of this Security or end on a date other than an
Interest Payment Date. Upon the termination of any Extension Period and upon the
payment of all accrued and unpaid interest and any Additional Interest then due,
the Company may select a new Extension Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extension Period
except at the end thereof and no default under this Security or Event of Default
shall be deemed to occur solely as a result of an Extension Period. The Company
shall give the Holder of this Security and the Trustee notice of its selection
of an Extension Period at least one Business Day prior to the earlier of (i) the
Interest Payment Date and (ii) the date that El Paso Energy Capital Trust I is
required to give notice to the New York Stock Exchange or other applicable
self-regulatory organization or to holders of the Trust Securities of the record
date or the date distributions by such Trust are payable, but in any event not
less than one Business Day prior to such record date.
Payment of the principal of and interest on this Security will be made
at the office or agency of the Company maintained for that purpose in New York,
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;
provided, however, that at the option of the Company payment of interest may be
made (i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer in
immediately available funds to such account as may be designated by the Person
entitled thereto as specified in the Security Register, so long as the
applicable Paying Agent has received proper transfer instructions in writing by
the Record Date prior to the applicable Interest Payment Date.
The indebtedness evidenced by this Security is, to the extent provided
in the Subordinated Indenture, subordinate and subject in right of payment to
the prior payment in full of all Senior Debt, and this Security is issued
subject to the provisions of the Subordinated Indenture with respect thereto.
Each Holder of this Security, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the Trustee on his behalf
to take such action as may be necessary or appropriate to effectuate the
subordination so provided and (c) appoints the Trustee his
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attorney-in-fact for any and all such purposes. Each Holder hereof, by his
acceptance hereof, waives all notice of the acceptance of the subordination
provisions contained herein and in the Subordinated Indenture by each holder of
Senior Debt, whether now outstanding or hereafter incurred, and waives reliance
by each such holder upon said provisions.
Reference is hereby made to the further provisions of the Subordinated
Indenture summarized 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.
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IN WITNESS WHEREOF, El Paso Natural Gas Company has caused this
instrument to be duly executed under its corporate seal.
Dated:
EL PASO NATURAL GAS COMPANY
By:
-----------------------------------
X. Xxxxx Xxxxxx
Executive Vice President and
Chief Financial Officer
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CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within mentioned Subordinated Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
-----------------------------------
Authorized Officer
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This Security is one of a duly authorized issue of Securities of the
Company, designated as its 4 3/4% Subordinated Convertible Debentures Due 2028
(herein called the "Securities"), limited in aggregate principal amount to (a)
$334,750,000 plus (b) such additional aggregate principal amount (which may not
exceed $36,050,000 principal amount) of Securities as shall be purchased in
connection with the exercise by the Underwriters of the over-allotment option
pursuant to the Underwriting Agreement, issued under a Subordinated Indenture,
dated as of March 1, 1998, as supplemented by that certain First Supplemental
Indenture (the "Supplemental Indenture"), dated as of March 17, 1998
(collectively referred to herein as the "Subordinated Indenture"), between the
Company and The Chase Manhattan Bank, as Trustee (herein called the "Trustee,"
which term includes any successor trustee under the Indenture), to which
Subordinated Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Trustee, the Company and the Holders of
the Securities, and of the terms upon which the securities are, and are to be,
authenticated and delivered.
All terms used in this Security which are defined in the Subordinated
Indenture shall have the meanings assigned to them in the Subordinated
Indenture.
The Company shall have the right to redeem this Security, at the option
of the Company, upon not less than 30 nor more than 60 days' notice, without
premium or penalty, in whole or in part at any time on or after March 31, 2002
(an "Optional Redemption") at the following prices (expressed as percentages of
the principal amount of the Securities) (the "Optional Redemption Price")
together with accrued and unpaid interest, including Additional Interest and
Additional Sums to, but excluding, the redemption date, if redeemed during the
12-month period beginning March 31:
Year Redemption Price
---- ----------------
2002 102.850%
2003 102.375%
2004 101.900%
2005 101.425%
2006 100.950%
2007 100.475%
2008 and thereafter 100%
If the Securities are redeemed on any March 31, June 30, September 30,
or December 31, accrued and unpaid interest (including accrued and unpaid
Additional Interest, if any) shall be payable to holders of record on the
relevant record date.
In addition, if at any time prior to the Conversion Expiration Date
less than ten percent (10%) in principal amount of the Securities originally
issued by the Company remain outstanding, such Subordinated Debentures shall be
redeemable, at the option of the Company, exercisable at any time in whole but
not in part, at a Redemption Price equal to the aggregate unpaid principal
amount thereof, and all accrued and unpaid interest due thereon.
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So long as the corresponding Trust Securities are outstanding, the
proceeds from the redemption of any of the Securities will be used by the
Property Trustee to redeem Trust Securities. In addition, so long as the Trust
Securities are outstanding, the proceeds from any repayment or prepayment of the
Securities will be used to redeem Trust Securities in accordance with the
Declaration.
If the Securities are only partially redeemed by the Company pursuant
to an Optional Redemption, the Securities will be redeemed pro rata or by lot or
by any other method utilized by the Trustee;
In the event of redemption of this Security in part only, a new
Security or Securities of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof, except in
the case of a Global Security in which case the Trustee may reflect a reduction
in the principal amount of such Global Security by making a notation of same in
the schedule included in such Global Security.
In case an Event of Default, as defined in the Subordinated Indenture,
shall have occurred and be continuing, the principal of all of the Securities
and the interest accrued thereon may be declared, and upon such declaration
shall become, due and payable, in the manner, with the effect and subject to the
conditions provided in the Subordinated Indenture.
If a Trust Special Event (as defined herein) shall occur and be
continuing, this Security shall be exchangeable for Trust Securities in
accordance with Section 5.3 of the Supplemental Indenture, unless a Trust
Special Event is a Trust Tax Event (as defined herein), in which case this
Security may be redeemed by the Company in accordance with Section 5.2 of the
Supplemental Indenture.
"Trust Investment Company Event" means that the Property Trustee of the
Trust, in its capacity on behalf of the El Paso Energy Capital Trust I (the
"Trust"), shall have received an opinion of independent legal counsel having a
national tax and securities practice and that is experienced in such matters
(which opinion of counsel shall not have been rescinded by such law firm) to the
effect that as a result of the occurrence on or after March 17, 1998 of a change
in law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an unsubstantial risk that the Trust is or, within
90 days after such date, will be considered an "investment company" which is
required to be registered under the Investment Company Act of 1940.
"Trust Special Event" means the occurrence of a Trust Investment
Company Event or a Trust Tax Event.
"Trust Tax Event" means the receipt by the Property Trustee of the
Trust, on behalf of the Trust, of an opinion of counsel, rendered by a law firm
having a national tax and securities practice (which opinion of counsel shall
not have been rescinded by such law firm) to the effect that there has been (a)
an amendment to, change or announced proposed change in the laws (or any
regulations
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thereunder) of the United States or any political subdivision or taxing
authority thereof or therein, (b) a judicial decision interpreting applying or
clarifying such laws or regulations, (c) an administrative pronouncement or
action that represents an official position (including a clarification of an
official position) of the governmental authority or regulatory body making such
administrative pronouncement or taking such action, or (d) a threatened
challenge asserted in connection with an audit of the Company or any of its
subsidiaries, or the Trust, or a threatened challenge asserted in writing
against any other taxpayer that has raised capital through the issuance of
securities that are substantially similar to the Securities or the Trust
Preferred Securities, which amendment or change is adopted or which decision,
pronouncement or proposed change is announced or which action, clarification or
challenge occurs on or after March 17, 1998 and that there is more than an
insubstantial risk that (a) the Trust is or, within 90 days after such date,
will be subject to United States federal income tax with respect to income
accrued or received on the Securities, (b) the Trust is or, within 90 days after
such date, will be subject to more than a de minimis amount of other taxes,
duties, assessments or other governmental charges or (c) interest payable by the
Company on the 1998A Debentures is not or, within 90 days after such date, will
not be deductible for United States federal income taxes.
The Holder of this Security has the right, exercisable at any time
through the close of business (New York time) on the Business Day immediately
preceding the maturity of the Securities (or, in the case of this Security being
called for redemption, prior to the close of business on the Business Day prior
to the corresponding redemption date), to convert the principal amount thereof
(or any portion thereof that is an integral multiple of $50) into shares of
Common Stock at the initial conversion rate of 0.6011 shares of Common Stock
(1.2022 shares of Common Stock immediately after giving effect to the
two-for-one stock split to be effected by payment of a 100 percent stock
dividend (on a per share basis), which dividend is payable on April 1, 1998 to
stockholders of record on March 13, 1998) for each $50 in aggregate principal
amount of the Security (equivalent to a Conversion Price of $83.18 per share of
Common Stock (as determined prior to such two-for-one stock split)), subject to
adjustment under certain circumstances. To convert this Security, the Holder
hereof must (a) complete and sign a notice of conversion substantially in the
form attached hereto, (b) surrender this Security to a Conversion Agent, (c)
furnish appropriate endorsements or transfer documents if required by the
Conversion Agent and (d) pay any transfer or similar tax, if required.
If an Event of Default with respect to the Securities shall occur and
be continuing, the principal of the Securities may be declared due and payable
in the manner, with the effect and subject to the conditions provided in the
Subordinated Indenture.
The Subordinated Indenture contains provisions that relieve the Company
from the obligation to comply with certain restrictive covenants of the
Subordinated Indenture and for satisfaction and discharge at any time of the
entire indebtedness of this Security upon compliance by the Company with certain
conditions set forth in the Subordinated Indenture.
The Subordinated Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights
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of the Holders of the debt securities of each series to be affected under the
Subordinated Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in aggregate principal amount of the
Outstanding debt securities of all series to be affected (voting as one class).
The Subordinated Indenture also contains provisions permitting the Holders of a
majority in aggregate principal amount of the Outstanding debt securities of all
affected series (voting as one class), on behalf of the Holders of all debt
securities of such series, to waive compliance by the Company with certain
provisions of the Subordinated Indenture. The Subordinated Indenture permits,
with certain exceptions as therein provided, the Holders of a majority in
principal amount of debt securities of any series then Outstanding to waive
defaults under the Subordinated Indenture with respect to such series 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 thereof or
in exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.
No reference herein to the Subordinated Indenture and no provision of
this Security or of the Subordinated Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of (and premium, if any) and interest on this Security at the times,
place and rate, and in the coin or currency, herein prescribed.
As provided in the Subordinated Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in New York, New York, 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 authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees. 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 of their respective agents may treat the Person
in whose name this Security is registered as the owner hereof for all purposes,
whether or not this Security shall be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Securities are issuable only in registered form without coupons in
denominations of $50 and any integral multiple thereof. As provided in the
Subordinated Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of a different authorized denomination, as requested by the Holder surrendering
the same.
The Company and, by its acceptance of this Subordinated Debenture or a
beneficial interest herein, the Holder of, and any Person that acquires a
beneficial interest in, this Subordinated
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Debenture agree that for United States federal, state and local tax purposes it
is intended that this Subordinated Debenture constitutes indebtedness.
No recourse under or upon any obligation, covenant or agreement of or
contained in the Subordinated Indenture or of or contained in any of the
Securities, or for any claim based thereon or otherwise in respect thereof, or
in any Security, or because of the creation of any indebtedness represented
thereby, shall be had against any incorporator, stockholder, officer, employee
or director, as such, past, present or future, of the Company or of any
successor Person, either directly or through the Company or any successor
Person, whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment, penalty or otherwise; it being expressly
understood by each Holder that all such liability is hereby expressly waived and
released by the acceptance hereof and as a condition of, and as part of the
consideration for, the issuance of the Securities and the execution of the
Subordinated Indenture.
THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF.
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ASSIGNMENT FORM
To assign this Subordinated Debenture or the capital stock issuable
upon conversion of this Subordinated Debenture in the event the Notice of
Conversion is given, fill in the form below:
(I) or (we) assign or transfer this Subordinated Debenture or such
capital stock (as the case may be) to
(Insert assignee's social security or tax identification number)
_____________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ___________________ agent to transfer this Subordinated
Debenture or such capital stock on the books of the Company. The agent may
substitute another to act for him.
Your Signature:_________________________________________
(Sign exactly as your name appears on the other
side of this Subordinated Debenture)
Date:_____________________
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SIGNATURES
Signature Guarantee: * ____________________________________________
_________________
* Signature must be guaranteed by an institution which is a member of one
of the following recognized Signature Guaranty Programs: (i) The
Securities Transfer Agent Medallion Program (STAMP); (ii) The New York
Stock Exchange Medallion Program (MSP); (iii) The Stock Exchange
Medallion Program (SEMP); or (iv) in such other guarantee programs
acceptable to the Trustee.
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FORM OF NOTICE OF CONVERSION
To: El Paso Natural Gas Company
The Chase Manhattan Bank, as Conversion Agent
The undersigned owner of this Subordinated Debenture hereby irrevocably
exercises the option to convert this Subordinated Debenture, or the portion
designated, and directs that the shares issuable and deliverable upon
conversion, together with any check in payment for fractional shares, be issued
in the name of and delivered to the undersigned, unless a different name has
been indicated in the assignment above. If shares are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto.
Date:_______________________
in whole _________
in part __________ Portions of Subordinated Debenture to
be converted ($50 or integral multiples
thereof):
$_______________________________________
Signature (for conversion only):
________________________________________
________________________________________
________________________________________
________________________________________
________________________________________
Please Print or Typewrite Name and
Address, Including Zip Code, and
Social Security or Other Identifying
Number
________________________________________
________________________________________
________________________________________
Signature Guarantee: * _______________________________
________________
* Signature must be guaranteed by an institution which is a member of one
of the following recognized Signature Guaranty Programs: (i) The
securities Transfer Agent Medallion Program (STAMP); (ii) The New York
Stock Exchange Medallion Program (MSP); (iii) The Stock Exchange
Medallion Program (SEMP); or (iv) in such other guarantee programs
acceptable to the Trustee.
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SCHEDULE
The notations on the following table evidence decreases in the
principal sum of this Security resulting from conversions or increases resulting
from the exercise of the Over-Allotment Option. As used herein, the term
"Over-Allotment Option" means that certain option to purchase up to 700,000
additional Trust Preferred Securities granted by the Trust to the Underwriters
pursuant to the Underwriting Agreement, dated March 11, 1998, among the Company,
the Trust and the Underwriters (as defined in the Supplemental Indenture).
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Decrease or Increase in | Principal Sum | Notation Made by
Principal Sum | remaining after Decrease | Security Registrar
| or Increase |
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| |
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| |
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| |
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