Exhibit 10.34
$300,000,000
Brigham Exploration Company
6 7/8% Senior Notes due 2019
PURCHASE AGREEMENT
May 16, 2011
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Credit Suisse Securities (USA) LLC,
As Representatives of the Several Purchasers,
c/o Merrill Lynch, Pierce, Fenner & Smith, Incorporated
One Bryant Park, 10th Floor
New York, New York 10036
Ladies and Gentlemen:
1. Introductory. Brigham Exploration Company, a Delaware corporation (the
“Company”), agrees with Merrill Lynch, Pierce, Fenner & Smith Incorporated
(“Merrill Lynch”) and Credit Suisse Securities (USA) LLC (“Credit Suisse”), as
representatives (the “Representatives”) of the several initial purchasers named
on Schedule A hereto (the “Purchasers”) subject to the terms and conditions
stated herein, to issue and sell to the Purchasers U.S. $300,000,000 aggregate
principal amount of its 6 7/8% Senior Notes due 2019 (“Offered Securities”) to
be issued under an indenture (the “Indenture”) to be dated as of the Closing
Date (as defined herein) by and among the Company, the Guarantors (as defined
herein) and Wells Fargo Bank, N.A., as Trustee (herein so called). The Offered
Securities will be unconditionally guaranteed as to the payment of principal and
interest (the “Guarantees”) by Brigham, Inc., a Nevada corporation, and Brigham
Oil & Gas, L.P., a Delaware limited partnership (each a “Guarantor” and,
together, the “Guarantors”).
The holders of the Offered Securities will be entitled to the benefits of a
Registration Rights Agreement to be dated as of the Closing Date by and among
the Company, the Guarantors and the Purchasers (the “Registration Rights
Agreement”), pursuant to which the Company and the Guarantors will agree to file
with the Commission (a) a registration statement under the Securities Act (as
defined herein) relating to a new series of notes and related guarantees
(collectively, the “Exchange Securities”), which shall be substantially
identical to the Offered Securities and the Guarantees (except that the Exchange
Securities shall have been registered pursuant to such registration statement
and will not be subject to restrictions on transfer or contain additional
interest provisions), to be offered in exchange for the Offered Securities and
the Guarantees (such offer to exchange being referred to as the “Exchange
Offer”), and/or (b) under certain circumstances, a shelf registration statement
pursuant to Rule 415 under the Securities Act (the “Shelf Registration
Statement”) relating to the resale by certain holders of the Offered Securities.
If the Company or the Guarantors fail to satisfy their obligations under the
Registration Rights Agreement, they will be required to pay additional interest
to the holders of the Offered Securities under certain circumstances, as
described therein.
Each of the Company and the Guarantors hereby agrees with the Purchasers as
follows:
2. Representations and Warranties of the Company and the Guarantors. Each of the
Company and the Guarantors represents and warrants to, and agrees with, the
Purchasers that:
(a) Offering Memorandums; Certain Defined Terms. The Company has prepared or
will prepare a Preliminary Offering Memorandum and a Final Offering Memorandum.

 

 

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For purposes of this Agreement:
“Applicable Time” means 4:00 p.m. (New York time) on the date of this Agreement.
“Closing Date” has the meaning set forth in Section 3 hereof.
“Commission” means the U.S. Securities and Exchange Commission.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended,
including the Rules and Regulations promulgated thereunder.
“Final Offering Memorandum” means the final offering memorandum relating to the
Offered Securities prepared by or on behalf of the Company for use by the
Purchasers that discloses the offering price and other final terms of the
Offered Securities and is dated as of the date of this Agreement (even if
finalized and issued subsequent to the date of this Agreement).
“Free Writing Communication” means a written communication (as such term is
defined in Rule 405) that constitutes an offer to sell or a solicitation of an
offer to buy the Offered Securities and is made by means other than the
Preliminary Offering Memorandum or the Final Offering Memorandum.
“General Disclosure Package” means the Preliminary Offering Memorandum together
with any Issuer Free Writing Communication existing at the Applicable Time and
the information in which is intended for general distribution to prospective
investors, as evidenced by its being specified on Schedule B hereto.
“Issuer Free Writing Communication” means a Free Writing Communication prepared
by or on behalf of the Company for use by the Purchasers, used or referred to by
the Company or containing a description of the final terms of the Offered
Securities or of their offering, in the form retained in the Company’s records.
“Preliminary Offering Memorandum” means the preliminary offering memorandum
relating to the Offered Securities prepared by or on behalf of the Company for
use by the Purchasers and dated May 16, 2011.
“Rules and Regulations” means the rules and regulations of the Commission.
“Securities Act” means the U.S. Securities Act of 1933, as amended, including
the Rules and Regulations promulgated thereunder.
“Securities Laws” means, collectively, the Sarbanes-Oxley Act of 2002
(“Sarbanes-Oxley”), the Securities Act, the Exchange Act, the Rules and
Regulations, the auditing principles, rules, standards and practices applicable
to auditors of “issuers” (as defined in Sarbanes-Oxley) promulgated or approved
by the Public Company Accounting Oversight Board and, as applicable, the rules
of the New York Stock Exchange and the NASDAQ Stock Market (“Exchange Rules”).
“Supplemental Marketing Material” means any Issuer Free Writing Communication
other than any Issuer Free Writing Communication specified on Schedule B hereto.
Supplemental Marketing Materials include, but are not limited to, the electronic
Bloomberg roadshow slides and the accompanying audio recording.
“Trust Indenture Act of 1939” means the U.S. Trust Indenture Act of 1939, as
amended, including the Rules and Regulations promulgated thereunder.

 

 

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Unless otherwise specified, a reference to a “rule” is to the indicated rule
under the Securities Act.
Unless otherwise specified, all references herein to the terms “General
Disclosure Package” and “Final Offering Memorandum” shall be deemed to mean and
include all information filed under the Exchange Act prior to the Applicable
Time and incorporated by reference in the General Disclosure Package (including
the Preliminary Offering Memorandum) or the Final Offering Memorandum, as the
case may be, and all references herein to the terms “amend,” “amendment” or
“supplement” with respect to the Final Offering Memorandum shall be deemed to
mean and include all information filed under the Exchange Act after the
Applicable Time and incorporated by reference in the Final Offering Memorandum.
(b) Disclosure. As of the date of this Agreement, the Final Offering Memorandum
does not, and as of the Closing Date, the Final Offering Memorandum will not,
include any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. At the Applicable
Time, and as of the Closing Date, neither (i) the General Disclosure Package,
nor (ii) any individual Supplemental Marketing Material, when considered
together with the General Disclosure Package, included, or will include, any
untrue statement of a material fact or omitted, or will omit, to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The preceding two
sentences do not apply to statements in or omissions from the Preliminary or
Final Offering Memorandum, the General Disclosure Package or any Supplemental
Marketing Material based upon written information furnished to the Company by
the Purchasers specifically for use therein, it being understood and agreed that
the only such information is that described as such in Section 8(b) hereof.
Except as disclosed in the General Disclosure Package, on the date of this
Agreement, the Company’s Annual Report on Form 10-K most recently filed with the
Commission and all subsequent reports (collectively, the “Exchange Act Reports”)
which have been filed by the Company with the Commission or sent to stockholders
pursuant to the Exchange Act and incorporated by reference in the Preliminary or
Final Offering Memorandum do not include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading. Such
documents, when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act and the Rules and Regulations.
(c) Good Standing of the Company. The Company has been duly incorporated and is
existing and in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct its
business as described in the General Disclosure Package; and the Company is duly
qualified to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of its
business requires such qualification, except for any jurisdiction where the
failure to be so qualified would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or other), business,
properties, prospects or results of operations of the Company and its
subsidiaries taken as a whole (“Material Adverse Effect”).
(d) Subsidiaries. Each subsidiary of the Company has been duly incorporated or
organized and is existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, with power and authority
(corporate and other) to own its properties and conduct its business as
described in the General Disclosure Package; and each subsidiary of the Company
is duly qualified to do business as a foreign corporation or limited partnership
in good standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification, except for
any such jurisdiction where the failure to be so qualified would not have a
Material Adverse Effect; all of the issued and outstanding equity interests of
each subsidiary of the Company have been duly authorized and validly issued and
are fully paid and nonassessable; and the capital stock or other equity
securities of each subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects, except as
disclosed in the General Disclosure Package or pledged in connection with the
Company’s senior credit agreement. The Company has no subsidiaries other than
the Guarantors.

 

 

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(e) Indenture; Security Interests. Each of the Indenture and the Offered
Securities has been duly authorized; and, when the Offered Securities are
delivered and paid for pursuant to this Agreement on the Closing Date, (i) the
Indenture will have been duly executed and delivered, (ii) such Offered
Securities will have been duly executed, authenticated, issued and delivered,
(iii) the Indenture and such Offered Securities will conform to the information
in the General Disclosure Package relating thereto and such Offered Securities
will conform to the description of the Offered Securities contained in the Final
Offering Memorandum and the Indenture, (iv) the Indenture will constitute valid
and legally binding obligations of the Company and the Guarantors, enforceable
against the Company and the Guarantors in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights
and to general equity principles; and (v) the Offered Securities will constitute
valid and legally binding obligations of the Company, enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors’ rights and to general equity principles, and entitled to
the benefits and security provided by the Indenture.
(f) Trust Indenture Act. On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture Act, and the Rules
and Regulations applicable to an indenture which is qualified thereunder.
(g) No Finder’s Fee. Except as disclosed in the General Disclosure Package,
there are no contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Purchaser for a brokerage commission, finder’s fee or other like payment.
(h) Registration Rights Agreement. The Registration Rights Agreement has been
duly authorized by the Company and the Guarantors; and, when the Offered
Securities are delivered and paid for pursuant to this Agreement on the Closing
Date, the Registration Rights Agreement will have been duly executed and
delivered by, and will constitute valid and legally binding obligations of, the
Company and the Guarantors, enforceable in accordance with their terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights
and to general equity principles.
(i) Exchange Securities. On the Closing Date, the Exchange Securities will have
been duly authorized by the Company and the Guarantors; and when the Exchange
Securities are issued, executed and authenticated in accordance with the terms
of the Exchange Offer and the Indenture, the Exchange Securities will be
entitled to the benefits of the Indenture and will constitute valid and legally
binding obligations of the Company and the Guarantors, enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors’ rights and to general equity principles.
(j) Guarantee. The Guarantee to be endorsed on the Offered Securities by each
Guarantor has been duly authorized by such Guarantor; and, when the Offered
Securities are delivered and paid for pursuant to this Agreement on the Closing
Date and issued, executed and authenticated in accordance with the terms of the
Indenture, the Guarantee of each Guarantor endorsed thereon will have been duly
executed and delivered by each such Guarantor, will conform to the description
thereof contained in the Final Offering Memorandum and will constitute valid and
legally binding obligations of such Guarantor, enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors’ rights and to general equity principles. The Guarantee
to be endorsed on the Exchange Securities by each Guarantor has been duly
authorized by such Guarantor; and, when issued, will have been duly executed and
delivered by each such Guarantor and will conform to the description thereof
contained in the Final Offering Memorandum. When the Exchange Securities have
been issued, executed and authenticated in accordance with the terms of the
Exchange Offer and the Indenture, the Guarantee of each Guarantor endorsed
thereon will constitute valid and legally binding obligations of such Guarantor,
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles.

 

 

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(k) No Registration Rights. Other than the Registration Rights Agreement, there
are no contracts, agreements or understandings between the Company or any
Guarantor and any person granting such person the right to require the Company
or such Guarantor to file a registration statement under the Securities Act with
respect to any securities of the Company or such Guarantor or to require the
Company or such Guarantor to include such securities with the Securities and
Guarantees registered pursuant to any Registration Statement (collectively,
“registration rights”).
(l) Absence of Further Requirements. No consent, approval, authorization, or
order of, or filing or registration with, any person (including any governmental
agency or body or any court) is required for the consummation of the
transactions contemplated by this Agreement, the Indenture and the Registration
Rights Agreement in connection with the offering, issuance and sale of the
Offered Securities and the Guarantees by the Company and the Guarantors except
for (i) such as have been obtained, (ii) the effective registration required
under the Exchange Offer Registration Statement or, if required, the Shelf
Registration Statement, or (iii) the qualification of the Indenture under the
Trust Indenture Act, in connection with any registered issuance of the Exchange
Notes.
(m) Title to Property. Except as disclosed in the General Disclosure Package,
the Company and its subsidiaries have (i) defensible title to all their
interests in the oil and gas properties described in the General Disclosure
Package as being owned or leased by them, title investigations having been
carried out by the Company in accordance with customary practice in the oil and
gas industry, and (ii) good and marketable title to all other real property and
all personal property described in the General Disclosure Package as being owned
by them, in each case (except as encumbered under the Company’s senior credit
agreement) free and clear of any security interests, mortgages, liens,
encumbrances, equities, claims and other title defects, except such as do not
materially and adversely affect the value of such property and do not materially
interfere with the use made or proposed to be made of such property by the
Company or its subsidiaries. Except as disclosed in the General Disclosure
Package, the Company and its subsidiaries do not hold any leased real or
personal property under valid and enforceable leases with terms or provisions
that would materially interfere with the use made or to be made thereof by them.
(n) Absence of Defaults and Conflicts Resulting from Transaction. The execution,
delivery and performance of the Indenture, this Agreement and the Registration
Rights Agreement, and the issuance and sale of the Offered Securities and
Guarantees and compliance with the terms and provisions thereof will not result
in a breach or violation of any of the terms and provisions of, or constitute a
default or a Debt Repayment Triggering Event (as defined below) under, or result
in the imposition of any lien, charge or encumbrance upon any property or assets
of the Company or the Guarantors pursuant to (i) the charter or by-laws of the
Company or the Guarantors,(ii) any statute, any rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or the Guarantors or any of their properties, or
(iii) any agreement or instrument to which the Company or the Guarantors is a
party or by which the Company or the Guarantors is bound or to which any of the
properties of the Company or the Guarantors is subject, except (in the case of
(ii) and (iii)) for breaches or violations which would not have a Material
Adverse Effect; a “Debt Repayment Triggering Event” means any event or condition
that gives, or with the giving of notice or lapse of time would give, the holder
of any note, debenture, or other evidence of indebtedness (or any person acting
on such holder’s behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or the
Guarantors.

 

 

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(o) Absence of Existing Defaults and Conflicts. None of the Company or the
Guarantors is in violation of its respective charter or by-laws or in default
(or with the giving of notice or lapse of time would be in default) under any
existing obligation agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument to which any of
them is a party or by which any of them is bound or to which any of the
properties of any of them is subject, except such defaults that would not,
individually or in the aggregate, result in a Material Adverse Effect.
(p) Authorization of Agreement. This Agreement has been duly authorized,
executed and delivered by the Company and the Guarantors.
(q) Possession of Licenses and Permits. The Company and the Guarantors possess,
and are in compliance with the terms of, all adequate certificates,
authorizations, franchises, licenses and permits (“Licenses”) necessary or
material to the conduct of the business now conducted or proposed in the General
Disclosure Package to be conducted by them and have not received any notice of
proceedings relating to the revocation or modification of any Licenses that, if
determined adversely to the Company or the Guarantors, would individually or in
the aggregate have a Material Adverse Effect.
(r) Absence of Labor Dispute. No labor dispute with the employees of the Company
or the Guarantors exists or, to the knowledge of the Company or the Guarantors,
is imminent that could have a Material Adverse Effect.
(s) Possession of Intellectual Property. The Company and the Guarantors own,
possess or can acquire on reasonable terms, adequate trademarks, trade names and
other rights to inventions, know how, patents, copyrights, confidential
information and other intellectual property (collectively, “intellectual
property rights”) necessary to conduct the business now operated by them, or
presently employed by them, and have not received any notice of infringement of
or conflict with asserted rights of others with respect to any intellectual
property rights that, if determined adversely to the Company or the Guarantors,
would individually or in the aggregate have a Material Adverse Effect.
(t) Environmental Laws. Except as disclosed in the General Disclosure Package,
none of the Company or the Guarantors is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any court,
domestic or foreign, relating to the use, disposal or release of hazardous or
toxic substances or relating to the protection or restoration of the environment
or human exposure to hazardous or toxic substances (collectively, “environmental
laws”), owns or operates any real property contaminated with any substance that
is subject to any environmental laws, is liable for any off site disposal or
contamination pursuant to any environmental laws, or is subject to any claim
relating to any environmental laws, which violation, contamination, liability or
claim would individually or in the aggregate have a Material Adverse Effect; and
the Company is not aware of any pending investigation which might lead to such a
claim.
(u) Accurate Disclosure. The statements in the General Disclosure Package and
the Final Offering Memorandum under the headings “Certain United States Federal
Income Tax Considerations,” “Description of the Notes” and “Description of other
Indebtedness” insofar as such statements summarize legal matters, agreements,
documents or proceedings discussed therein, are accurate and fair summaries of
such legal matters, agreements, documents or proceedings and present the
information required to be shown.

 

 

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(v) Absence of Manipulation. None of the Company, the Guarantors and their
respective affiliates has, either alone or with one or more other persons, bid
for or purchased for any account in which it or any of its affiliates had a
beneficial interest in any Offered Securities or attempted to induce any person
to purchase any Offered Securities.
(w) Statistical and Market-Related Data. Any third-party statistical and
market-related data included in a Preliminary Offering Memorandum, a Final
Offering Memorandum, or any Issuer Free Writing Communication are based on or
derived from sources that the Company and the Guarantors believe to be reliable
and accurate.
(x) Internal Controls and Compliance with the Sarbanes-Oxley Act. Except as set
forth in the General Disclosure Package, the Company and the Guarantors and the
Company’s Board of Directors (the “Board”) are in compliance with Sarbanes-Oxley
and all applicable Exchange Rules. The Company and each Guarantor maintains a
system of internal controls, including, but not limited to, disclosure controls
and procedures, internal controls over accounting matters and financial
reporting, and legal and regulatory compliance controls (collectively, “Internal
Controls”), that comply with the Securities Laws and are sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
U.S. Generally Accepted Accounting Principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. The Internal
Controls are, or, upon consummation of the offering of the Offered Securities
will be, overseen by the Audit Committee (the “Audit Committee”) of the Board in
accordance with Exchange Rules. Neither the Company nor the Guarantors have
publicly disclosed or reported to the Audit Committee or the Board, and within
the next 90 days neither the Company nor the Guarantors reasonably expect to
publicly disclose or report to the Audit Committee or the Board, a significant
deficiency, material weakness, change in Internal Controls or fraud involving
management or other employees who have a significant role in Internal Controls
(each, an “Internal Control Event”), any violation of, or failure to comply
with, the Securities Laws, or any matter which, if determined adversely, would
have a Material Adverse Effect.
(y) Disclosure Controls and Procedures. The Company maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e) under the
Exchange Act) that comply with the requirements of the Exchange Act; such
disclosure controls and procedures have been designed to ensure that material
information relating to the Company and its subsidiaries is made known to the
Company’s principal executive officer and principal financial officer by others
within those entities; and such disclosure controls and procedures are
effective.
(z) Absence of Accounting Issues. Except as set forth in the General Disclosure
Package, the Audit Committee is not reviewing or investigating, and neither the
Company’s independent auditors nor its internal auditors have recommended that
the Audit Committee review or investigate, (i) adding to, deleting, changing the
application of, or changing the Company’s disclosure with respect to, any of the
Company’s material accounting policies; (ii) any matter which could result in a
restatement of the Company’s financial statements for any annual or interim
period during the current or prior three fiscal years; or (iii) any Internal
Control Event.
(aa) Litigation. Except as disclosed in the General Disclosure Package, there
are no pending actions, suits or proceedings (including any inquiries or
investigations by any court or governmental agency or body, domestic or foreign)
against or affecting the Company, the Guarantors, or any of their respective
properties that, if determined adversely to the Company or the Guarantors, would
individually or in the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company or the Guarantors to
perform their obligations under the Indenture, this Agreement, or the
Registration Rights Agreement, or which are otherwise material in the context of
the sale of the Offered Securities and the Guarantees; and no such actions,
suits or proceedings (including any inquiries or investigations by any court or
governmental agency or body, domestic or foreign) are threatened or, to the
Company’s or the Guarantors’ knowledge, contemplated.

 

 

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(bb) Financial Statements. The financial statements included in the General
Disclosure Package present fairly in all material respects the financial
position of the Company and its consolidated subsidiaries as of the dates shown
and their results of operations and cash flows for the periods shown, and such
financial statements have been prepared in conformity with the generally
accepted accounting principles in the United States applied on a consistent
basis.
(cc) No Material Adverse Change in Business. Except as disclosed in the General
Disclosure Package, since the end of the period covered by the latest audited
financial statements included in the General Disclosure Package (i) there has
been no change, nor any development or event involving a prospective change, in
the condition (financial or otherwise), results of operations, business,
properties or prospects of the Company and the Guarantors, taken as a whole,
that is material and adverse; (ii) except as disclosed in or contemplated by the
General Disclosure Package, there has been no dividend or distribution of any
kind declared, paid or made by the Company or the Guarantors on any class of
their capital stock and (iii) except as disclosed in or contemplated by the
General Disclosure Package, there has been no material adverse change in the
capital stock, short-term indebtedness, long-term indebtedness, net current
assets or net assets of the Company and the Guarantors.
(dd) Reserve Engineers. Cawley, Gillespie & Associates, a petroleum engineering
firm from whose reserve reports information (the “Reserve Information”) is set
forth in the General Disclosure Package, are independent petroleum engineers
with respect to the Company. Other than (i) the production of reserves in the
ordinary course of business (ii) intervening price fluctuations or (iii) as
described in the General Disclosure Package, the Company is not aware of any
facts or circumstances that would result in a material adverse change in its
proved reserves in the aggregate, or the aggregate present value of estimated
future net revenues of the Company or the standardized measure of discounted
future net cash flows therefrom, as described in the General Disclosure Package
and reflected in the Reserve Information as of the respective dates such
information is given. Estimates of the proved reserves and the present value of
the estimated future net revenues and the discounted future net cash flows
derived therefrom as described in the General Disclosure Package and reflected
in the Reserve Information comply in all material respects to the applicable
requirements of the Act.
(ee) Solvency. All indebtedness represented by the Offered Securities is being
incurred for the purposes set forth in the General Disclosure Package under the
heading “Use of Proceeds.” On the Closing Date, the Company will be solvent. As
used in this paragraph, “solvent” means, with respect to a particular date, that
on such date (i) the present fair market value (present fair saleable value) of
the assets of the Company and each of its subsidiaries is not less than the
total amount required to pay the probable liabilities of the Company and each of
such subsidiaries on its total existing debts and liabilities (including
contingent liabilities) as they become absolute and matured, (ii) the Company
and each of its subsidiaries are able to realize upon their assets and pay their
debts and other liabilities, contingent obligations and commitments as they
mature and become due in the normal course of business, (iii) assuming the sale
of the Offered Securities as contemplated by this Agreement and the General
Disclosure Package, each of the Company and the subsidiaries is not incurring
debts or liabilities beyond its ability to pay such debts and liabilities as
they mature, and (iv) each of the Company and its subsidiaries is not engaged in
any business or transaction, and is not about to engage in any business or
transaction, for which its property would constitute unreasonably small capital
after giving due consideration to the prevailing practice in the industry in
which each of the Company and such subsidiaries is engaged. In computing the
amount of such contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount that, in the light of all the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.

 

 

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(ff) Investment Company Act.— Neither the Company nor any Guarantor is and,
after giving effect to the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the General Disclosure
Package, will not be an “investment company” as defined in the Investment
Company Act of 1940 (the “Investment Company Act”).
(gg) Ratings. No “nationally recognized statistical rating organization” as such
term is defined for purposes of Rule 436(g)(2) (i) has imposed (or has informed
the Company or any Guarantor that it is considering imposing) any condition
(financial or otherwise) on the Company’s or any Guarantor’s retaining any
rating assigned to the Company or any Guarantor or any securities of the Company
or any Guarantor or (ii) has indicated to the Company or any Guarantor that it
is considering any of the actions described in Section 7(b)(ii) hereof.
(hh) Regulations T, U, X. Neither the Company nor any Guarantor nor any agent
thereof acting on their behalf has taken, and none of them will take, any action
that might cause this Agreement or the issuance or sale of the Offered
Securities to violate Regulation T, Regulation U or Regulation X of the Board of
Governors of the Federal Reserve System.
(ii) Class of Securities Not Listed. The Offered Securities are eligible for
resale pursuant to Rule 144A under the Securities Act (“Rule 144A”), and no
securities of the same class (within the meaning of Rule 144A(d)(3)) as the
Offered Securities are listed on any national securities exchange registered
under Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer
quotation system.
(jj) No Registration. The offer and sale of the Offered Securities in the manner
contemplated by this Agreement will be exempt from the registration requirements
of the Securities Act by reason of Section 4(2) thereof, Regulation D
(“Regulation D”) thereunder and Regulation S (“Regulation S”) thereunder; and it
is not necessary to qualify the Indenture under the Trust Indenture Act.
(kk) No General Solicitation; No Directed Selling Efforts. Neither the Company,
nor any Guarantor, nor any of their respective affiliates, nor any person acting
on its or their behalf (i) has, within the six-month period prior to the date
hereof, offered or sold in the United States or to any U.S. person (as such
terms are defined in Regulation S) the Offered Securities or any security of the
same class or series as the Offered Securities or (ii) has offered or will offer
or sell the Offered Securities (A) in the United States by means of any form of
general solicitation or general advertising within the meaning of Rule 502(c) or
(B) with respect to any such securities sold in reliance on Rule 903 of
Regulation S, by means of any directed selling efforts within the meaning of
Rule 902(c) of Regulation S. The Company, the Guarantors, their respective
affiliates and any person acting on its or their behalf have complied and will
comply with the offering restrictions requirement of Regulation S. Neither the
Company nor any Guarantor has entered and neither the Company nor any Guarantor
will enter into any contractual arrangement with respect to the distribution of
the Offered Securities except for this Agreement.

 

 

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(ll) Compliance with Anti-Bribery Laws, Anti-Money Laundering Laws and Laws and
Regulations Imposing U.S. Economic Sanctions. Each of the Company and the
Guarantors and their affiliates and their respective officers, directors,
supervisors, managers, agents, or employees, have not violated, the Company’s
participation in the offering will not violate, and the Company has instituted
and maintains policies and procedures designed to ensure continued compliance
with: (i) any applicable anti-bribery laws, rules or regulations of any
locality, including, but not limited to, any law, rule, or regulation
promulgated to implement the OECD Convention on Combating Bribery of Foreign
Public Officials in International Business Transactions, signed December 17,
1997, the U.S. Foreign Corrupt Practices Act of 1977 or any other law, rule or
regulation of similar purpose and scope; (ii) applicable federal, state,
international, foreign or other anti-money laundering laws, regulations or
government guidance regarding anti-money laundering, including, but not limited
to, Title 18 U.S. Code section 1956 and 1957, the Patriot Act, the Bank Secrecy
Act, and international anti-money laundering principals or procedures by an
intergovernmental group or organization, such as the Financial Action Task Force
on Money Laundering, of which the United States is a member and with which
designation the United States representative to the group or organization
continues to concur, all as amended, and any Executive Order, directive, or
regulation pursuant to the authority of any of the foregoing, or any orders or
licenses issued thereunder; or (iii) laws and regulations imposing U.S. economic
sanctions measures, including, but not limited to, the International Emergency
Economic Powers Act, the Trading with the Enemy Act, the United Nations
Participation Act, and the Syria Accountability and Lebanese Sovereignty Act,
all as amended, and any Executive Order, directive, or regulation pursuant to
the authority of any of the foregoing, including the regulations of the U.S.
Treasury Department set forth under 31 CFR, Subtitle B, Chapter V, as amended,
or any orders or licenses issued thereunder.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of the
representations, warranties and agreements and subject to the terms and
conditions set forth herein, the Company agrees to sell to the several
Purchasers and each of the Purchasers agrees, severally and not jointly, to
purchase from the Company, at a purchase price of 98.125% of the principal
amount thereof, the respective principal amounts of Offered Securities set forth
opposite the names of the several Purchasers on Schedule A hereto.
The Company will deliver against payment of the purchase price the Offered
Securities to be offered and sold by the Purchasers in reliance on Regulation S
(the “Regulation S Securities”) in the form of one or more permanent global
notes in registered form without interest coupons (the “Offered Regulation S
Global securities”) which will be deposited with the Trustee as custodian for
The Depository Trust Company (“DTC”) for the respective accounts of the DTC
participants for Morgan Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System (“Euroclear”), and Clearstream Banking, société
anonyme (“Clearstream, Luxembourg”) and registered in the name of Cede & Co., as
nominee for DTC. The Company will deliver against payment of the purchase price
the Offered Securities to be purchased by each Purchaser hereunder and to be
offered and sold by each Purchaser in reliance on Rule 144A (the “144A
Securities”) in the form of one or more permanent global notes in definitive
form without interest coupons (the “Restricted Global Securities”) deposited
with the Trustee as custodian for DTC and registered in the name of Cede & Co.,
as nominee for DTC. The Regulation S Global Securities and the Restricted Global
Securities shall be assigned separate CUSIP numbers. The Restricted Global
Securities shall include the legend regarding restrictions on transfer set forth
under “Transfer Restrictions” in the Final Offering Memorandum. Until the
termination of the distribution compliance period (as defined in Regulation S)
with respect to the offering of the Offered Securities, interests in the
Regulation S Global Securities may only be held by the DTC participants for
Euroclear and Clearstream, Luxembourg. Interests in any permanent global notes
will be held only in book-entry form through Euroclear, Clearstream, Luxembourg
or DTC, as the case may be, except in the limited circumstances described in the
Final Offering Memorandum.
Payment for the Regulation S Securities and the 144A Securities shall be made by
the Purchasers in Federal (same day) funds by wire transfer to the account
specified in writing by the Company two days prior to the Closing Date at the
office of Vinson & Elkins, L.L.P., 2500 First City Tower, 1001 Fannin Street,
Houston, Texas 77002 at 10:00 A.M., (New York time), on May 19, 2011 or at such
other time thereafter as the Representatives and the Company determine, such
time being herein referred to as the “Closing Date,” against delivery to the
Trustee as custodian for DTC of (i) the Regulation S Global Securities
representing all of the Regulation S Securities for the respective accounts of
the DTC participants for Euroclear and Clearstream, Luxembourg and (ii) the
Restricted Global Securities representing all of the Offered 144A Securities.
The Regulation S Global Securities and the Restricted Global Securities will be
made available for checking at the above office of Vinson & Elkins, LLP at least
24 hours prior to the Closing Date.

 

 

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4. Representations by Purchasers; Resale by Purchasers.
(a) Each Purchaser severally represents and warrants to the Company and the
Guarantors that it is a “qualified institutional buyer” (a “QIB”) within the
meaning of Rule 144A and an “accredited investor” within the meaning of
Regulation D.
(b) Each Purchaser severally acknowledges that the Offered Securities have not
been registered under the Securities Act and may not be offered or sold within
the United States or to, or for the account or benefit of, U.S. persons except
in accordance with Regulation S or pursuant to an exemption from the
registration requirements of the Securities Act. Each Purchaser severally
represents and agrees that it has offered and sold the Offered Securities, and
will offer and sell the Offered Securities (i) as part of its distribution at
any time and (ii) otherwise until 40 days after the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 903 or
Rule 144A. Accordingly, neither such Purchaser nor its affiliates, nor any
persons acting on its or their behalf, have engaged or will engage in any
directed selling efforts with respect to the Offered Securities, and such
Purchaser, its affiliates and all persons acting on its or their behalf have
complied and will comply with the offering restrictions requirement of
Regulation S. Each Purchaser severally agrees that, at or prior to confirmation
of sale of the Offered Securities, other than a sale pursuant to Rule 144A, such
Purchaser will have sent to each distributor, dealer or person receiving a
selling concession, fee or other remuneration that purchases the Offered
Securities from it during the restricted period a confirmation or notice to
substantially the following effect:
“The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933 (the “Securities Act”) and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
(i) as part of their distribution at any time or (ii) otherwise until 40 days
after the later of the date of the commencement of the offering and the closing
date, except in either case in accordance with Regulation S (or Rule 144A if
available) under the Securities Act. Terms used above have the meanings given to
them by Regulation S.”
Terms used in this subsection (b) have the meanings given to them by
Regulation S.
(c) Each Purchaser severally agrees that it and each of its affiliates has not
entered and will not enter into any contractual arrangement with respect to the
distribution of the Offered Securities except for any such arrangements with the
other Purchasers or affiliates of the other Purchasers or with the prior written
consent of the Company.
(d) Each Purchaser severally agrees that it and each of its affiliates will not
offer or sell the Offered Securities in the United States by means of any form
of general solicitation or general advertising within the meaning of
Rule 502(c), including, but not limited to (i) any advertisement, article,
notice or other communication published in any newspaper, magazine or similar
media or broadcast over television or radio, or (ii) any seminar or meeting
whose attendees have been invited by any general solicitation or general
advertising. Each Purchaser severally agrees, with respect to resales made in
reliance on Rule 144A of any of the Offered Securities, to deliver either with
the confirmation of such resale or otherwise prior to settlement of such resale
a notice to the effect that the resale of such Offered Securities has been made
in reliance upon the exemption from the registration requirements of the
Securities Act provided by Rule 144A.

 

 

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(e) In relation to each Member State of the European Economic Area which has
implemented the Prospectus Directive (each, a “Relevant Member State”), each of
the Purchasers severally represents and agrees that with effect from and
including the date on which the Prospectus Directive is implemented in that
Relevant Member State (the “Relevant Implementation Date”) it has not made and
will not make an offer of Offered Securities to the public in that Relevant
Member State prior to the publication of a prospectus in relation to the Offered
Securities which has been approved by the competent authority in that Relevant
Member State or, where appropriate, approved in another Relevant Member State
and notified to the competent authority in that Relevant Member State, all in
accordance with the Prospectus Directive, except that it may, with effect from
and including the Relevant Implementation Date, make an offer of Offered
Securities to the public in that Relevant Member State at any time:
(i) to legal entities which are authorized or regulated to operate in the
financial markets or, if not so authorized or regulated, whose corporate purpose
is solely to invest in securities;
(ii) to any legal entity which has two or more of (A) an average of at least 250
employees during the last financial year; (B) a total balance sheet of more than
€43,000,000 and (C) an annual net turnover of more than €50,000,000, as shown in
its last annual or consolidated accounts; or
(iii) in any other circumstances which do not require the publication by the
Company of a prospectus pursuant to Article 3 of the Prospectus Directive.
For the purposes of this provision, the expression an “offer of Offered
Securities to the public” in relation to any Offered Securities in any Relevant
Member State means the communication in any form and by any means of sufficient
information on the terms of the offer and the Offered Securities to be offered
so as to enable an investor to decide to purchase or subscribe the Offered
Securities, as the same may be varied in that Member State by any measure
implementing the Prospectus Directive in that Member State and the expression
“Prospectus Directive” means Directive 2003/71/EC and includes any relevant
implementing measure in each Relevant Member State.
(f) Each of the Purchasers severally represents and agrees that:
(i) it has only communicated or caused to be communicated and will only
communicate or cause to be communicated an invitation or inducement to engage in
investment activity (within the meaning of Section 21 of the Financial Services
and Markets Act 2000 (the “FSMA”)) to persons who have professional experience
in matters relating to investments falling within Article 19(5) of the FSMA or
in circumstances in which Section 21(1) of the FSMA does not apply to the
Company or the Guarantors; and
(ii) it has complied and will comply with all applicable provisions of the FSMA
with respect to anything done by it in relation to the Offered Securities in,
from or otherwise involving the United Kingdom.
5. Certain Agreements of the Company and each Guarantor. The Company and each
Guarantor agree with the several Purchasers that:
(a) Amendments and Supplements to Offering Memorandums. The Company and the
Guarantors will promptly advise the Representatives of any proposal to amend or
supplement the Preliminary or Final Offering Memorandum and will not effect such
amendment or supplementation without the Representatives’ consent. If, at any
time prior to the completion of the resale of the Offered Securities by the
Purchasers, there occurs an event or development as a result of which any
document included in the Preliminary or Final Offering Memorandum, the General
Disclosure Package or any Supplemental Marketing Material, if republished
immediately following such event or development, included or would include an
untrue statement of a material fact or omitted or would omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, the Company and
the Guarantors promptly will notify the Representatives of such event and
promptly will prepare and furnish, at its own expense, to the Purchasers and the
dealers and to any other dealers at the request of the Representatives, an
amendment or supplement which will correct such statement or omission. Neither
the Representatives’ consent to, nor its delivery to offerees or investors of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 7.

 

 

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(b) Furnishing of Offering Memorandums. The Company and the Guarantors will
furnish to the Representatives copies of the Preliminary Offering Memorandum,
each other document comprising a part of the General Disclosure Package, the
Final Offering Memorandum, all amendments and supplements to such documents and
each item of Supplemental Marketing Material, in each case as soon as available
and in such quantities as the Representatives request. At any time when the
Company is not subject to Section 13 or 15(d), the Company and the Guarantors
will promptly furnish or cause to be furnished to the Representatives (and, upon
request, to each of the other Purchasers) and, upon request of holders and
prospective purchasers of the Offered Securities, to such holders and
purchasers, copies of the information required to be delivered to holders and
prospective purchasers of the Offered Securities pursuant to Rule 144A(d)(4) (or
any successor provision thereto) in order to permit compliance with Rule 144A in
connection with resales by such holders of the Offered Securities. The Company
will pay the expenses of printing and distributing to the Purchasers all such
documents.
(c) Blue Sky Qualifications. The Company and the Guarantors will arrange for the
qualification of the Offered Securities for sale and the determination of their
eligibility for investment under the laws of such jurisdictions in the United
States and Canada as the Representatives designate and will continue such
qualifications in effect so long as required for the resale of the Offered
Securities by the Purchasers, provided that the Company will not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any such state.
(d) Reporting Requirements. For so long as the Offered Securities remain
outstanding, the Company will furnish to the Representatives and, upon request,
to each of the other Purchasers, as soon as practicable after the end of each
fiscal year, a copy of the Company’s annual report to stockholders for such
year; and the Company will furnish to the Representatives and, upon request, to
each of the other Purchasers (i) as soon as available, a copy of each report and
any definitive proxy statement of the Company filed with the Commission under
the Exchange Act or mailed to stockholders, and (ii) from time to time, such
other information concerning the Company and the Guarantors as the
Representatives may reasonably request. However, so long as the Company is
subject to the reporting requirements of either Section 13 or Section 15(d) of
the Exchange Act and is timely filing reports with the Commission on its
Electronic Data Gathering, Analysis and Retrieval system (“EDGAR”), it is not
required to furnish such reports or statements to the Purchasers.
(e) Transfer Restrictions. During the period of one year after the Closing Date,
the Company will, upon request, furnish to the Representatives, each of the
other Purchasers and any holder of Offered Securities a copy of the restrictions
on transfer applicable to the Offered Securities.
(f) No General Solicitation. The Company and the Guarantors will not engage and
will cause its other affiliates and any person acting on their behalf (other
than, in any case, the Purchasers and any of their affiliates, as to whom the
Company and the Guarantors make no covenant) not to engage, in any form of
general solicitation or general advertising (within the meaning of Regulation D)
in connection with any offer or sale of the Offered Securities in the United
States.
(g) No Directed Selling. The Company and the Guarantors will not engage and will
cause its other affiliates and any person acting on their behalf (other than, in
any case, the Purchasers and any of their affiliates, as to whom the Company and
the Guarantors make no covenant) not to engage, in any directed selling effort
with respect to the Offered Securities, and will comply, and will cause its
other affiliates and any person acting on their behalf (other than, in any case,
the Purchasers and any of their affiliates, as to whom the Company and the
Guarantors make no covenant) to comply, with the offering restrictions
requirement of Regulation S. Terms used in this Section 5(g) have the meanings
given to them by Regulation S.

 

 

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(h) No Resales by Affiliates. During the period of one year after the Closing
Date, the Company will not, and will not permit any of its affiliates (as
defined in Rule 144) to, resell any of the Offered Securities that have been
reacquired by any of them.
(i) Investment Company. During the period of one year after the Closing Date,
neither the Company nor any Guarantor will be or become, an open-end investment
company, unit investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the Investment Company Act.
(j) Payment of Expenses. The Company and the Guarantors will pay all expenses
incidental to the performance of their respective obligations under this
Agreement, the Indenture and the Registration Rights Agreement, including but
not limited to (i) the fees and expenses of the Trustee and its professional
advisers; (ii) all expenses in connection with the execution, issue,
authentication, packaging and initial delivery of the Offered Securities and, as
applicable, the Exchange Securities, the preparation and printing of this
Agreement, the Registration Rights Agreement, the Offered Securities, the
Indenture, the Preliminary Offering Memorandum, any other documents comprising
any part of the General Disclosure Package, the Final Offering Memorandum, all
amendments and supplements thereto, each item of Supplemental Marketing Material
and any other document relating to the issuance, offer, sale and delivery of the
Offered Securities and as applicable, the Exchange Securities; (iii) all fees
and expenses (including fees and expenses of counsel) of the Company in
connection with approval of the Offered Securities by DTC for “book-entry”
transfer; (iv) any expenses (including fees and disbursements of counsel to the
Purchasers) incurred in connection with qualification of the Offered Securities
or the Exchange Securities for sale under the laws of such jurisdictions in the
United States and Canada as the Representatives designate and the preparation
and printing of memoranda relating thereto (v) any fees charged by investment
rating agencies for the rating of the Securities or the Exchange Securities, and
(vi) expenses incurred in distributing the Preliminary Offering Memorandum, any
other documents comprising any part of the General Disclosure Package, the Final
Offering Memorandum (including any amendments and supplements thereto) and any
Supplemental Marketing Material to the Purchasers. The Company and the
Guarantors will also pay or reimburse the Purchasers (to the extent incurred by
them) for costs and expenses of the Company’s officers and employees and any
other expenses of the Company and the Guarantors relating to investor
presentations on any “road show” in connection with the offering and sale of the
Offered Securities including, without limitation, any travel expenses of the
Company’s and the Guarantors’ officers and employees and any other expenses of
the Company and the Guarantors; provided that, except as provided in this
Section 5(j) and in Sections 8 and 10 hereof, the Purchasers shall pay their own
costs and expenses, including the costs and expenses of their counsel.
(k) Use of Proceeds. The Company will use the net proceeds received in
connection with this offering in the manner described in the “Use of Proceeds”
section of the General Disclosure Package and, except as disclosed in the
General Disclosure Package, the Company does not intend to use any of the
proceeds from the sale of the Offered Securities hereunder to repay any
outstanding debt owed to any affiliate of any Purchaser.
(l) Absence of Manipulation. In connection with the offering, until Merrill
Lynch shall have notified the Company and the other Purchasers of the completion
of the resale of the Offered Securities, neither the Company, the Guarantors,
nor any of their affiliates will, either alone or with one or more other
persons, bid for or purchase for any account in which it or any of its
affiliates has a beneficial interest any Offered Securities or attempt to induce
any person to purchase any Offered Securities; and neither it nor any of their
affiliates will make bids or purchases for the purpose of creating actual, or
apparent, active trading in, or of raising the price of, the Offered Securities.

 

 

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(m) Restriction on Sale of Securities. For a period of 120 days after the date
hereof, neither the Company nor any Guarantor will, directly or indirectly, take
any of the following actions with respect to any U.S. dollar-denominated debt
securities issued or guaranteed by the Company or such Guarantor and having a
maturity of more than one year from the date of issue or any securities
convertible into or exchangeable or exercisable for any of its Securities
(“Lock-Up Securities”): (i) offer, sell, issue, contract or grant any option,
right or warrant to sell, pledge, transfer or otherwise dispose of Lock-Up
Securities, (ii) offer, sell, issue, contract or grant any option to sell,
contract or grant any option, right or warrant to purchase Lock-Up Securities,
(iii) enter into any swap, hedge, open “put equivalent position” within the
meaning of Rule 16a-1 under the Exchange Act or any other agreement that
transfers, in whole or in part, the economic consequences of ownership of
Lock-Up Securities, (iv) establish or increase a put equivalent position or
liquidate or decrease a call equivalent position in Lock-Up Securities within
the meaning of Section 16 of the Exchange Act or (v) announce the offering of,
or file with the Commission a registration statement under the Securities Act
relating to Lock-Up Securities or publicly disclose the intention to take any
such action, without the prior written consent of Merrill Lynch and Credit
Suisse (which consent may be withheld at the sole discretion of Merrill Lynch
and Credit Suisse). Neither the Company nor any Guarantor will at any time
directly or indirectly, take any action referred to in clauses (i) through
(v) above with respect to any securities under circumstances where such offer,
sale, pledge, contract or disposition would cause the exemption afforded by
Section 4(2) of the Securities Act or the safe harbor of Regulation S thereunder
to cease to be applicable to the offer and sale of the Offered Securities.
6. Free Writing Communications.
(a) Issuer Free Writing Communications. The Company and each Guarantor
represents and agrees that, unless it obtains the prior consent of the
Representatives, and each Purchaser represents and agrees that, unless it
obtains the prior consent of the Company and the Representatives, it has not
made and will not make any offer relating to the Offered Securities that would
constitute an Issuer Free Writing Communication.
(b) Term Sheets. The Company consents to the use by any Purchaser of a Free
Writing Communication that (i) contains only (A) information describing the
preliminary terms of the Offered Securities or their offering or (B) information
that describes the final terms of the Offered Securities or their offering and
that is included in or is subsequently included in the Final Offering
Memorandum, including by means of a pricing term sheet in the form of Exhibit 1
to Schedule B hereto, or (ii) does not contain any material information about
the Company or any Guarantor or their securities that was provided by or on
behalf of the Company or any Guarantor, it being understood and agreed that the
Company and each Guarantor shall not be responsible to any Purchaser for
liability arising from any inaccuracy in such Free Writing Communications
referred to in clause (i) or (ii) as compared with the information in the
Preliminary Offering Memorandum, the Final Offering Memorandum or the General
Disclosure Package.
7. Conditions of the Obligations of the Purchasers. The obligations of the
several Purchasers to purchase and pay for the Offered Securities will be
subject to the accuracy of the representations and warranties of the Company and
the Guarantors herein (as though made on the Closing Date), to the accuracy of
the statements of officers of the Company and the Guarantors made pursuant to
the provisions hereof, to the performance by the Company and the Guarantors of
their obligations hereunder and to the following additional conditions
precedent:
(a) Accountants’ Comfort Letter. The Purchasers shall have received a “comfort
letter” from KPMG LLP dated the date hereof on the General Disclosure Package in
form and substance satisfactory to the Purchasers concerning certain financial
and accounting information set forth in the General Disclosure Package. In
addition, the Purchasers shall have received a “bring down comfort letter” from
KPMG LLP dated as of the Closing Date, addressing the matters in the “comfort
letter” delivered on the date hereof pursuant to the preceding sentence, except
that (i) each “bring-down comfort letter” shall cover the financial and
accounting information in the Final Offering Memorandum and any amendment or
supplement thereto and (ii) procedures shall be brought down to a date no more
than 2 days prior to the Closing Date, and otherwise in form and substance
satisfactory to the Purchasers.

 

 

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(b) Reserve Engineer Comfort Letter. The Purchasers shall have received letters,
dated the date hereof, of Cawley, Gillespie & Associates, an independent
petroleum engineers firm for the Company, and in form and substance satisfactory
to the Representatives and the Representatives’ counsel, with respect to the
estimated quantities of the Company’s reserves, the future net revenues from
those reserves and their present value as set forth in the General Disclosure
Package and the Final Offering Memorandum and such related matters as the
Representatives shall reasonably request.
(c) No Material Adverse Change. Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any development or
event involving a prospective change, in the condition (financial or otherwise),
results of operations, business, properties or prospects of the Company and the
Guarantors taken as a whole which, in the judgment of the Representatives, is
material and adverse and makes it impractical or inadvisable to market the
Offered Securities; (ii) any downgrading in the rating of any debt securities of
the Company by any “nationally recognized statistical rating organization” (as
defined for purposes of Rule 436(g)), or any public announcement that any such
organization has under surveillance or review its rating of any debt securities
of the Company other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of such
rating) or any announcement that the Company has been placed on negative
outlook; (iii) any change in U.S. or international financial, political or
economic conditions or currency exchange rates or exchange controls the effect
of which is such as to make it, in the judgment of the Representatives,
impractical to market or to enforce contracts for the sale of the Offered
Securities, whether in the primary market or in respect of dealings in the
secondary market, (iv) any suspension or material limitation of trading in
securities generally on the New York Stock Exchange, or any setting of minimum
or maximum prices for trading on such exchange; (v) any suspension of trading of
any securities of the Company on any exchange or in the over-the-counter market;
(vi) any banking moratorium declared by any U.S. federal or New York
authorities; (vii) any major disruption of settlements of securities, payment,
or clearance services in the United States or any other country where such
securities are listed or (viii) any attack on, outbreak or escalation of
hostilities or act of terrorism involving the United States, any declaration of
war by Congress or any other national or international calamity or emergency if,
in the judgment of the Representatives, the effect of any such attack, outbreak,
escalation, act, declaration, calamity or emergency is such as to make it in the
judgment of the Representatives impractical or inadvisable to market the Offered
Securities or to enforce contracts for the sale of the Offered Securities.
(d) Opinion of Counsel for Company. The Representatives shall have received an
opinion, dated such Closing Date, of Thompson & Knight LLP, counsel for the
Company, with respect to such matters as the Representatives may require.
(e) Opinion of General Counsel of the Company. The General Counsel of the
Company shall have furnished to the Representative her written opinion, as
counsel to the Company, dated the Closing Date with respect to such matters as
the Representatives may require.
(f) Opinion of Counsel for Purchasers. The Purchasers shall have received from
Vinson & Elkins LLP, counsel for the Purchasers, such opinion or opinions, dated
the Closing Date with respect to such matters as the Representatives may
require, and the Company and the Guarantors shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass upon
such matters.

 

 

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(g) Officers’ Certificate. The Purchasers shall have received certificates,
dated the Closing Date, of an executive officer of the Company and the
Guarantors and a principal financial or accounting officer of the Company and
the Guarantors in which such officers shall state that the representations and
warranties of the Company and the Guarantors in this Agreement are true and
correct as of the Closing Date, that the Company and the Guarantors have
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied hereunder at or prior to the Closing Date, and that,
subsequent to the date of the most recent financial statements in the General
Disclosure Package there has been no material adverse change, nor any
development or event involving a prospective material adverse change, in the
condition (financial or otherwise), results of operations, business, properties
or prospects of the Company, the Guarantors and their respective subsidiaries
taken as a whole except as set forth in the General Disclosure Package or as
described in such certificate.
The Company and the Guarantors will furnish the Purchasers with such conformed
copies of such opinions, certificates, letters and documents as the Purchasers
reasonably request. Merrill Lynch may in its sole discretion waive on behalf of
the Purchasers compliance with any conditions to the obligations of the
Purchasers hereunder, whether in respect of an Optional Closing Date or
otherwise.
8. Indemnification and Contribution.
(a) Indemnification of Purchasers. The Company and the Guarantors will indemnify
and hold harmless each Purchaser, its officers, employees, agents, partners,
members, directors and its affiliates and each person, if any, who controls such
Purchaser within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act (each, an “Indemnified Party”), against any and all losses,
claims, damages or liabilities, joint or several, to which such Indemnified
Party may become subject, under the Securities Act, the Exchange Act, other
Federal or state statutory law or regulation or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Preliminary Offering Memorandum or the Final
Offering Memorandum, in each case as amended or supplemented, or any Issuer Free
Writing Communication (including with limitation, any Supplemental Marketing
Material), or the Exchange Act Reports, or arise out of or are based upon the
omission or alleged omission of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and will reimburse each Indemnified Party for any legal or
other expenses reasonably incurred by such Indemnified Party in connection with
investigating, preparing or defending against any loss, claim, damage,
liability, action, litigation, investigation or proceeding whatsoever (whether
or not such Indemnified Party is a party thereto) whether threatened or
commenced and in connection with the enforcement of this provision with respect
to any of the above as such expenses are incurred; provided, however, that the
Company and the Guarantors will not be liable in any such case, to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Purchaser through the
Representatives specifically for use therein, it being understood and agreed
that the only such information consists of the information described as such in
subsection (b) below.
(b) Indemnification of Company. Each Purchaser will severally and not jointly
indemnify and hold harmless each of the Company, the Guarantors, each of their
respective directors and each of their respective officers and each person, if
any, who controls the Company or such Guarantor within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act (each, a “Purchaser
Indemnified Party”), against any losses, claims, damages or liabilities to which
such Purchaser Indemnified Party may become subject, under the Securities Act,
the Exchange Act, other Federal or state statutory law or regulation or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Preliminary Offering
Memorandum or the Final Offering Memorandum, in each case as amended or
supplemented, or any Issuer Free

 

 

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Writing Communication or arise out of or are based upon the omission or the
alleged omission of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Purchaser through the Representatives specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
such Purchaser Indemnified Party in connection with investigating, preparing or
defending against any such loss, claim, damage, liability, action, litigation,
investigation or proceeding whatsoever (whether or not such Purchaser
Indemnified Party is a party thereto) whether threatened or commenced based upon
any such untrue statement or omission, or any such alleged untrue statement or
omission as such expenses are incurred, it being understood and agreed that the
only such information furnished by any Purchaser consists of the following
information in the Preliminary and Final Offering Memorandum: the information
under the sub-headings “Commissions and Discounts” and “Short Positions” under
the caption “Plan of Distribution;” provided, however, that the Purchasers shall
not be liable for any losses, claims, damages or liabilities arising out of or
based upon the Company’s failure to perform its obligations under Section 5(a)
of this Agreement.
(c) Actions against Parties; Notification. Promptly after receipt by an
indemnified party under this Section 8 of notice of the commencement of any
action, such indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under subsection (a) or (b) above, notify the
indemnifying party of the commencement thereof; but the failure to notify the
indemnifying party shall not relieve it from any liability that it may have
under subsection (a) or (b) above except to the extent that it has been
materially prejudiced (through the forfeiture of substantive rights or defenses)
by such failure; and provided further that the failure to notify the
indemnifying party shall not relieve it from any liability that it may have to
an indemnified party otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party will
not be liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such settlement
includes (i) an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action and (ii) does
not include a statement as to or an admission of fault, culpability or failure
to act by or on behalf of any indemnified party.
(d) Contribution. If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Purchasers on the other from the offering of
the Offered Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Guarantors on the one hand and the
Purchasers on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities as well as any other
relevant equitable considerations. The relative benefits received by the Company
and the Guarantors on the one hand and the Purchasers on

 

 

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the other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to
the total discounts and commissions received by the Purchasers from the Company
under this Agreement. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company and the Guarantors or the Purchasers and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim which is
the subject of this subsection (d). Notwithstanding the provisions of this
subsection (d), no Purchaser shall be required to contribute any amount in
excess of the amount by which the total price at which the Offered Securities
purchased by it were resold exceeds the amount of any damages which such
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. The Purchasers’ obligations in
this subsection (d) to contribute are several in proportion to their respective
purchase obligations and not joint. The Company, the Guarantors and the
Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 8(d) were determined by pro rata allocation (even if
the Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to in this Section 8(d).
9. Default of Purchasers. If any Purchaser or Purchasers default in their
obligations to purchase Offered Securities hereunder and the aggregate principal
amount of Offered Securities that such defaulting Purchaser or Purchasers agreed
but failed to purchase does not exceed 10% of the total principal amount of
Offered Securities, Merrill Lynch may make arrangements satisfactory to the
Company for the purchase of such Offered Securities by other persons, including
any of the Purchasers, but if no such arrangements are made by the Closing Date,
the non-defaulting Purchasers shall be obligated severally, in proportion to
their respective commitments hereunder, to purchase the Offered Securities that
such defaulting Purchasers agreed but failed to purchase. If any Purchaser or
Purchasers so default and the aggregate principal amount of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
principal amount of Offered Securities and arrangements satisfactory to Merrill
Lynch and the Company for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Purchaser or the
Company, except as provided in Section 10. As used in this Agreement, the term
“Purchaser” includes any person substituted for a Purchaser under this
Section 9. Nothing herein will relieve a defaulting Purchaser from liability for
its default.
10. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company, the Guarantors or their respective officers and of the several
Purchasers set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Purchaser, the Company, the
Guarantors or any of their respective representatives, officers or directors or
any controlling person, and will survive delivery of and payment for the Offered
Securities. If this Agreement is terminated pursuant to Section 9 or if for any
reason the purchase of the Offered Securities by the Purchasers is not
consummated, the Company and the Guarantors shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company, the Guarantors and the Purchasers pursuant to
Section 8 shall remain in effect. If the purchase of the Offered Securities by
the Purchasers is not consummated for any reason other than solely because of
the termination of this Agreement pursuant to Section 9 or the occurrence of any
event specified in clause (iii), (iv), (vi), (vii) or (viii) of Section 7(b),
the Company and the Guarantors will reimburse the Purchasers for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.

 

 

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11. Notices. All communications hereunder will be in writing and, if sent to the
Purchasers will be mailed, delivered or telegraphed and confirmed to the
Purchasers c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated, One Bryant
Park, New York, New York 10036, Facsimile: (212) 901-7897, Attention: Legal
Department; or, if sent to the Company or the Guarantors, will be mailed,
delivered or telegraphed and confirmed to it at Brigham Exploration Company,
6300 Bridge Point Parkway, Building 2, Suite 500, Austin, Texas 78730,
Attention: Kari Potts, General Counsel; provided, however, that any notice to a
Purchaser pursuant to Section 8 will be mailed, delivered or telegraphed and
confirmed to such Purchaser.
12. Successors. This Agreement will inure to the benefit of and be binding upon
the parties hereto and their respective successors and the controlling persons
referred to in Section 8, and no other person will have any right or obligation
hereunder, except that holders of Offered Securities shall be entitled to
enforce the agreements for their benefit contained in the second and third
sentences of Section 5(b) hereof against the Company as if such holders were
parties thereto.
13. Representation of Purchasers. You will act for the several Purchasers in
connection with this purchase, and any action under this Agreement taken by you
jointly or by Merrill Lynch will be binding upon all the Purchasers.
14. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same Agreement.
15. Absence of Fiduciary Relationship. The Company and the Guarantors
acknowledge and agree that:
(a) No Other Relationship. The Representatives have been retained solely to act
as initial purchasers in connection with the initial purchase, offering and
resale of the Offered Securities and that no fiduciary, advisory or agency
relationship between the Company or the Guarantors and the Representatives has
been created in respect of any of the transactions contemplated by this
Agreement or the Preliminary or Final Offering Memorandum, irrespective of
whether the Representatives have advised or is advising the Company or the
Guarantors on other matters;
(b) Arm’s-Length Negotiations. The purchase price of the Offered Securities set
forth in this Agreement was established by the Company and the Guarantors
following discussions and arms-length negotiations with the Representatives and
the Company and the Guarantors are capable of evaluating and understanding and
understand and accept the terms, risks and conditions of the transactions
contemplated by this Agreement;
(c) Absence of Obligation to Disclose. The Company has and the Guarantors have
been advised that the Representatives and their affiliates are engaged in a
broad range of transactions which may involve interests that differ from those
of the Company or the Guarantors and that the Representatives have no obligation
to disclose such interests and transactions to Company or the Guarantors by
virtue of any fiduciary, advisory or agency relationship; and
(d) Waiver. The Company and the Guarantors waive, to the fullest extent
permitted by law, any claims it may have against the Representatives for breach
of fiduciary duty or alleged breach of fiduciary duty and agree that the
Representatives shall have no liability (whether direct or indirect) to the
Company or the Guarantors in respect of such a fiduciary duty claim or to any
person asserting a fiduciary duty claim on behalf of or in right of the Company,
including stockholders, employees or creditors of the Company or the Guarantors.

 

 

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16. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
The Company and the Guarantors hereby submit to the non-exclusive jurisdiction
of the Federal and state courts in the Borough of Manhattan in The City of New
York in any suit or proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby. The Company and the Guarantors irrevocably
and unconditionally waive any objection to the laying of venue of any suit or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby in Federal and state courts in the Borough of Manhattan in
The City of New York and irrevocably and unconditionally waive and agree not to
plead or claim in any such court that any such suit or proceeding in any such
court has been brought in an inconvenient forum.
[Remainder of Page Left Intentionally Blank — Signature Pages Follow]

 

 

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Exhibit 10.34
If the foregoing is in accordance with the Purchasers’ understanding of our
agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Company, the Guarantors
and the several Purchasers in accordance with its terms.

            Very truly yours,

Brigham Exploration Company
      By:   /s/ Eugene B. Shepherd, Jr.         Name:   Eugene B. Shepherd, Jr. 
      Title:   Chief Financial Officer and
Executive Vice President   

            Brigham, Inc.
      By:   /s/ Eugene B. Shepherd, Jr.         Name:   Eugene B. Shepherd, Jr. 
      Title:   Chief Financial Officer and
Executive Vice President   

            Brigham Oil & Gas, L.P.       By:   Brigham, Inc., its general
partner         By:   /s/ Eugene B. Shepherd, Jr.         Name:   Eugene B.
Shepherd, Jr.        Title:   Chief Financial Officer and
Executive Vice President   

Signature Page to Purchase Agreement
Brigham Exploration Company Senior Notes due 2019

 

 

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The foregoing Purchase Agreement is hereby confirmed
and accepted as of the date first above written.
Acting on behalf of themselves and as the Representatives
of the several Purchasers.

         
By
  Merrill Lynch, Pierce, Fenner & Smith    
 
  Incorporated    
 
       
By:
  /s/ J. Lex Maultsby    
 
 
 
Name: J. Lex Maultsby    
 
  Title: Managing Director    
 
       
By
  Credit Suisse Securities (USA) LLC    
 
       
By:
  /s/ Robert Hendricks    
 
 
 
Name: Robert Hendricks    
 
  Title: Director    

Signature Page to Purchase Agreement
Brigham Exploration Company Senior Notes due 2019

 

 

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Exhibit 10.34
SCHEDULE A

              Principal Amount
of   Initial Purchasers   Offered Securities  
Merrill Lynch, Pierce, Fenner & Smith Incorporated
  $ 90,000,000  
Credit Suisse Securities (USA) LLC
    90,000,000  
RBC Capital Markets, LLC
    24,000,000  
BNP Paribas Securities Corp.
    15,750,000  
Capital One Southcoast, Inc.
    15,750,000  
Natixis Securities North America Inc.
    15,750,000  
RBS Securities Inc.
    15,750,000  
Banco Bilbao Vizcaya Agentaria, S.A.
    6,600,000  
Comerica Securities, Inc.
    6,600,000  
Lloyds Securities Inc.
    6,600,000  
Mitsubishi UFJ Securities (USA), Inc.
    6,600,000  
U.S. Bancorp Investments, Inc.
    6,600,000  
 
     
Total
  $ 300,000,000  
 
     

 

Schedule A-1

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SCHEDULE B
Issuer Free Writing Communications (included in the General Disclosure Package)

1.  
Final term sheet, dated May 16, 2011, a copy of which is attached hereto as
Exhibit 1.

 

 

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Exhibit 1
(BRIGHAM EXPLORATION COMPANY LOGO) [c17614c1761401.gif]
Pricing Supplement dated May 16, 2011 to the Preliminary Offering Memorandum
dated May 16, 2011 of Brigham Exploration Company. This Pricing Supplement is
qualified in its entirety by reference to the Preliminary Offering Memorandum.
The information in this Pricing Supplement supplements the Preliminary Offering
Memorandum and supersedes the information in the Preliminary Offering Memorandum
to the extent it is inconsistent with the information in the Preliminary
Offering Memorandum. Capitalized terms used in this Pricing Supplement but not
defined have the meanings given them in the Preliminary Offering Memorandum.
Pricing Term Sheet

     
Issuer:
  Brigham Exploration Company
Guarantors:
  The notes will be guaranteed on a senior unsecured basis by the Issuer’s
existing and future subsidiaries, subject to certain exceptions.
Security Description:
  6 7/8% Senior Notes due 2019
Face:
  $300,000,000
Maturity:
  June 1, 2019
Coupon:
  6.875%
Offering Price:
  100.000%
Yield to Maturity:
  6.875%
Interest Payment Dates:
  June 1 and December 1 of each year
First Payment Date:
  December 1, 2011
Record Dates:
  May 15 and November 15
Gross Proceeds:
  $300,000,000
Equity Clawback
  Up to 35% at 106.875% prior to June 1, 2014
Optional Redemption:
  On or after June 1, 2015, at the following redemption prices (expressed as a
percentage of principal amount), plus accrued and unpaid interest, if any, on
the Notes redeemed during the twelve-month period indicated beginning on June 1
of the years indicated below:

          Year   Price  
2015
    103.438 %
2016
    101.719 %
2017 and thereafter
    100.000 %

 

 

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  If certain transactions that would constitute a Change of Control occur prior
to June 1, 2012, we may redeem all, but not less than all, of the notes at a
redemption price equal to 110% of principal amount plus accrued and unpaid
interest.
 
   
Make-Whole:
  Make-whole redemption at Treasury Rate + 50 bps prior to June 1, 2015
Change of Control:
  Put at 101% of principal plus accrued interest
Trade Date:
  May 16, 2011
Settlement Date:
  May 19, 2011
CUSIP / ISIN:
  Rule 144A: 109178 AF0 / US109178AF08

Regulation S: U6224K AD1 / USU6224KAD10
 
   
Increments:
  Minimum denominations of $2,000 and integral multiples of $1,000 in excess
thereof
 
   
Joint Book-Running Managers:
  Merrill Lynch, Pierce, Fenner & Smith Incorporated Credit Suisse Securities
(USA) LLC
 
   
Co-Managers:
  RBC Capital Markets, LLC
BNP Paribas Securities Corp.
Capital One Southcoast, Inc.
Natixis Securities North America Inc.
RBS Securities Inc.
Banco Bilbao Vizcaya Agentaria, S.A.
Comerica Securities, Inc.
Lloyds Securities Inc.
Mitsubishi UFJ Securities (USA), Inc.
U.S. Bancorp Investments, Inc.
 
   
Use of Proceeds:
  The Issuer estimates that the net proceeds from this offering will be
approximately $293.9 million after deducting the initial purchasers’ discounts
and commissions and estimated offering expenses. The Issuer intends to use the
net proceeds from this offering to fund portions of its 2011 and 2012 capital
budgets and for general corporate purposes. Pending these uses, the Issuer
intends to pay down outstanding borrowings under its senior credit facility.
Certain of the initial purchasers or their affiliates are lenders under the
senior credit facility and accordingly may receive a portion of the proceeds to
the extent used to pay down outstanding borrowings.

This material is strictly confidential and has been prepared by the Issuer
solely for use in connection with the proposed offering of the securities
described in the Preliminary Offering Memorandum. This material is personal to
each offeree and does not constitute an offer to any other person or the public
generally to subscribe for or otherwise acquire the securities. Please refer to
the Preliminary Offering Memorandum for a complete description.
The securities have not been registered under the Securities Act of 1933, as
amended (the “Securities Act”), and are being offered only to (1) “qualified
institutional buyers” as defined in Rule 144A under the Securities Act and
(2) outside the United States to non-U.S. persons in compliance with
Regulation S under the Securities Act, and this communication is only being
distributed to such persons.
This communication is not an offer to sell the securities and it is not a
solicitation of an offer to buy the securities in any jurisdiction to any person
to whom it is unlawful to make such offer or soliciation in such jurisdiction.
Any disclaimer or other notice that may appear below is not applicable to this
communication and should be disregarded. Such disclaimer or notice was
automatically generated as a result of this communication being sent by
Bloomberg or another email system.