exv4w1






Exhibit 4.1




EXECUTION VERSION




SECOND SUPPLEMENTAL INDENTURE




by and among




PIONEER NATURAL RESOURCES COMPANY,

PIONEER NATURAL RESOURCES USA, INC.,




and




WELLS FARGO BANK, NATIONAL ASSOCIATION




as Trustee




Dated as of November 13, 2009




Supplement to Indenture for Debt Securities




Dated as of January 22, 2008




7.50% Senior Notes due 2020





 









 








Table of Contents




	 	 	 	 	 	 	 
	 	 	 	 	Page
	Section 1.
	 	Notes	 	 	2	 
	Section 2.
	 	Optional Redemption of Notes	 	 	3	 
	Section 3.
	 	Offer to Repurchase Upon a Change of Control Repurchase Event.	 	 	5	 
	Section 4.
	 	Obligation to Guarantee	 	 	6	 
	Section 5.
	 	Additional Covenants of the Company.	 	 	7	 
	Section 6.
	 	Amendments to Sections 1.01, 2.07 and 2.15.	 	 	8	 
	Section 7.
	 	Ratification	 	 	17	 
	Section 8.
	 	No Security Interest Created	 	 	17	 
	Section 9.
	 	Table of Contents, Headings, Etc	 	 	17	 
	Section 10.
	 	Severability	 	 	17	 
	Section 11.
	 	Counterparts	 	 	17	 
	Section 12.
	 	Governing Law	 	 	18	 
	Section 13.
	 	Trustee Not Responsible for Recitals or Issuance of Notes	 	 	18	 






 









 






SECOND SUPPLEMENTAL INDENTURE




     THIS SECOND SUPPLEMENTAL INDENTURE dated as of November 13, 2009 (this “Supplemental
Indenture”), among Pioneer Natural Resources Company, a Delaware corporation (the “Company”),
Pioneer Natural Resources USA, Inc., a Delaware corporation, for purposes of agreeing to make
certain guarantees pursuant to Section 4 hereof (the “Guarantor”), and Wells Fargo Bank, National
Association, national banking association organized under the laws of the United States of America,
as trustee (the “Trustee”). Capitalized terms used herein and not otherwise defined have the
meanings set forth in the Indenture referred to below.



RECITALS




     A. The Company and the Trustee, entered into that certain Indenture, dated as of January 22,
2008 (the “Indenture”), pursuant to which the Company may from time to time issue its debentures,
notes, bonds or other evidences of indebtedness (collectively, the “Debt Securities”).



     B. Section 9.01 of the Indenture provides that the Company, when authorized by a resolution of
the Board of Directors of the Company, and the Trustee may, without the consent of the holders of
the Debt Securities, enter into a supplemental indenture to establish the form or terms of Debt
Securities of any series as permitted by Sections 2.01 and 2.03 of the Indenture.



     C.
The Company desires to issue, and upon certain events specified in this Supplemental
Indenture, the Guarantor desires to agree to be obligated to guarantee, $450,000,000 aggregate
principal amount of 7.50% Senior Notes due 2020 (the “Notes”) and in connection therewith, the
Company and the Guarantor have duly determined to make, execute and deliver this Supplemental
Indenture to set forth the terms and provisions of the Notes as required by the Indenture.



     D.
The Company has determined that this Supplemental Indenture is authorized or permitted by
Section 9.01 of the Indenture and has delivered to the Trustee an Opinion of Counsel and Officers’
Certificate to the effect that all conditions precedent provided for in the Indenture to the
execution and delivery of this Supplemental Indenture have been complied with.



     E.
All things necessary to make the Notes, when executed by the Company and authenticated and
delivered by the Trustee or a duly authorized authenticating agent, as provided in the Indenture,
the valid and legally binding obligations of the Company, have been done.



     F. All things necessary to make this Supplemental Indenture a valid and legally binding
indenture and agreement according to its terms, and a valid and legally binding amendment of, and
supplement to, the Indenture have been done.



     NOW, THEREFORE, in consideration of the mutual agreements and covenants set forth herein, the
parties hereto agree, subject to the terms and conditions hereinafter set forth, as follows for the
benefit of the Trustee and the Holders of the Notes:



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AGREEMENT




     Section 1. Notes. Pursuant to Section 2.03 of the Indenture, the terms and provisions
of the Notes are as follows:



     (a) The title of the Notes shall be designated as the “7.50% Senior Notes due 2020.”



     (b) The Notes shall be initially limited to $450,000,000 aggregate principal amount. The
Company may, without the consent of the Holders of the Notes, increase such aggregate principal
amount in the future, on the same terms and conditions and with the same CUSIP numbers as the
Notes. The Company shall not issue any such additional Notes unless the additional Notes are
fungible with the Notes for United States federal income tax purposes.



     (c) The Notes shall not require any principal or premium payments prior to maturity on January
15, 2020.



     (d) The rate at which the Notes shall bear interest shall be 7.50% per annum; interest on the
Notes shall accrue from November 13, 2009, for the first interest payment and from the most recent
interest payment date thereafter; the interest payment dates on which such interest shall be
payable shall be January 15 and July 15, beginning January 15, 2010 (each an “Interest Payment
Date”); and the record dates for the determination of the holders of the Notes to whom such
interest is payable shall be the immediately preceding January 1 (for January 15 payment dates) and
July 1 (for July 15 payment dates) (each an “Interest Record Date”); the rate at which the overdue
principal shall bear interest shall be 1% per annum in excess of the rate stated initially in this
clause to the extent lawful; and the rate at which overdue installments of interest shall bear
interest shall be 1% per annum in excess of the rate stated initially in this clause to the extent
lawful.



     (e) Payments of principal of and interest on the Notes represented by one or more Global
Senior Notes initially registered in the name of The Depository Trust Company (the “Depositary”) or
its nominee with respect to the Notes shall be made by the Company through the Trustee in
immediately available funds to the Depositary or its nominee, as the case may be.



     (f) The Notes shall be redeemable at any time, at the option of the Company, in whole or from
time to time in part, at the price, and otherwise in accordance with the terms and provisions, set
forth in Section 2 of this Supplemental Indenture and (to the extent they do not conflict with
Section 2 of this Supplemental Indenture) the terms and provisions of Sections 3.03 and 3.04 of the
Indenture.



     (g) The Notes shall be represented by one or more Global Senior Notes deposited with the
Depositary and registered in the name of the nominee of the Depositary.



     (h) There shall be no mandatory sinking fund for the payments of the Notes.



     (i) As long as the Depositary or its nominee, or a successor Depositary or its nominee, is the
registered owner of the Global Senior Notes relating to the Notes, owners of the beneficial
interests in such Global Senior Notes shall not be entitled to have the Notes registered in their
names and shall not receive or be entitled to receive physical delivery of Notes in



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definitive form except (i) as provided in Section 2.15(c) of the Indenture or (ii) if an Event
of Default with respect to the Notes has occurred and is continuing.




     (j) Wells Fargo Bank, National Association shall be the trustee for the Notes under the
Indenture.



     (k) Article X of the Indenture shall apply to the Notes.



     (l) The Notes shall not be subordinated pursuant to the provisions of Article XII of the
Indenture. The Notes shall be senior unsecured obligations of the Company ranking pari passu with
other existing and future senior unsecured indebtedness of the Company.



     (m) The Company shall be subject to all the covenants set forth in Article IV of the Indenture
with respect to the Notes.



     (n) To the extent not set forth herein, the provisions of Section 2.03 of the Indenture are
not applicable.



     (o) Initially, the Trustee shall act as Paying Agent and Registrar. Interest shall be payable
at the office or agency of the Company maintained by the Company for such purposes in the United
States, which shall initially be the office of the Paying Agent at Sixth and Marquette,
Minneapolis, Minnesota 55479. The Company shall pay interest on any Notes in certificated form by
check mailed to the address of the Person entitled thereto as it appears in the Debt Security
Register (or upon written application by such Person to the Trustee and Paying Agent (if different
from the Trustee) not later than the relevant Interest Record Date, by wire transfer in immediately
available funds to such Person’s account within the United States, if such Person is entitled to
interest on an aggregate principal in excess of $1,000,000, which application shall remain in
effect until the Holder notifies the Trustee and Paying Agent to the contrary).



     Section 2. Optional Redemption of Notes. The Notes will be redeemable at any time, at
the option of the Company, in whole or from time to time in part, upon not less than 30 and not
more than 60 days’ notice as provided in the Indenture, on any date prior to maturity (the
“Redemption Date”) at a price equal to 100% of the principal amount thereof plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders of record on the relevant
record date to receive interest due on any interest payment date that is on or prior to the
Redemption Date) plus a Make-Whole Premium, if any (the “Redemption Price”). In no event will a
Redemption Price ever be less than 100% of the principal amount of the Notes plus accrued and
unpaid interest, if any, to the Redemption Date.



     The amount of the Make-Whole Premium with respect to any of the Notes (or portion thereof) to
be redeemed will be equal to the excess, if any, of:



     (a) the sum of the present values, calculated as of the Redemption Date, of:



          (i) each interest payment that, but for such redemption, would have been payable on such Note
(or portion thereof) being redeemed on each interest payment date occurring after the Redemption
Date (excluding any accrued interest for the period prior to the Redemption Date); and




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          (ii) the principal amount that, but for such redemption, would have been payable at the final
maturity of such Note (or portion thereof) being redeemed; over




     (b) the principal amount of such Note (or portion thereof) being redeemed.



     The present values of interest and principal payments referred to in clause (a) above will be
determined in accordance with generally accepted principles of financial analysis. Such present
values will be calculated by discounting the amount of each payment of interest or principal from
the date that each such payment would have been payable, but for the redemption, to the Redemption
Date at a discount rate equal to the Treasury Yield (as defined below) plus 50 basis points.



     The Make-Whole Premium will be calculated by an independent investment banking institution of
national standing appointed by the Company; provided that if the Company fails to make such
appointment at least 30 business days prior to the Redemption Date, or if the institution so
appointed is unwilling or unable to make such calculation, such calculation will be made by an
independent investment banking institution of national standing appointed by the Trustee (in any
such case, an “Independent Investment Banker”).



     For purposes of determining the Make-Whole Premium, “Treasury Yield” means a rate of interest
per annum equal to the weekly average yield to maturity of United States Treasury Notes that have a
constant maturity that corresponds to the remaining term to maturity of the applicable Notes,
calculated to the nearest 1/12th of a year (the “Remaining Term”). The Treasury Yield will be
determined as of the third business day immediately preceding the applicable Redemption Date.



     The weekly average yields of United States Treasury Notes will be determined by reference to
the most recent statistical release published by the Federal Reserve Bank of New York and
designated “H.15 (519) Selected Interest Rates” or any successor release (the “H.15 Statistical
Release”). If the H.15 Statistical Release sets forth a weekly average yield for United States
Treasury Notes having a constant maturity that is the same as the Remaining Term, then the Treasury
Yield will be equal to such weekly average yield. In all other cases, the Treasury Yield will be
calculated by interpolation, on a straight-line basis, between the weekly average yields on the
United States Treasury Notes that have a constant maturity closest to and greater than the
Remaining Term and the United States Treasury Notes that have a constant maturity closest to and
less than the Remaining Term (in each case as set forth in the H.15 Statistical Release). Any
weekly average yields so calculated by interpolation will be rounded to the nearest 1/100th of 1%,
with any figure of 1/200th of 1% or above being rounded upward. If weekly average yields for United
States Treasury Notes are not available in the H.15 Statistical Release or otherwise, then the
Treasury Yield will be calculated by interpolation of comparable rates selected by the Independent
Investment Banker.



     In the case of any partial redemption, selection of the Notes for redemption will be made by
the Trustee on a pro rata basis, by lot or by such other method as the Trustee in its sole
discretion shall deem to be fair and appropriate, although no such Note of $1,000 in original
principal amount or less shall be redeemed in part. If any Note is to be redeemed in part only,
the notice of redemption relating to such Note shall state the portion of the principal amount



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thereof to be redeemed. A new Note in principal amount equal to the unredeemed portion
thereof will be issued in the name of the Holder thereof upon cancellation of the original Note.




     Section 3. Offer to Repurchase Upon a Change of Control Repurchase Event.



     (a) If a Change of Control Repurchase Event occurs, unless the Company has otherwise exercised
its right to redeem the Notes, the Company will make an offer to each Holder of Notes to repurchase
all or any portion (equal to $1,000 or an integral multiple of $1,000) of such Holder’s Notes at a
price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and
unpaid interest, if any, on the Notes repurchased to the date of repurchase (the “Change of Control
Repurchase Event Payment”). Within 30 days following any Change of Control Repurchase Event, the
Company will mail a notice (the “Change of Control Repurchase Event Offer”) to each holder
describing the transaction or transactions that constitute the Change of Control Repurchase Event
and stating:



          (i) that the Change of Control Repurchase Event Offer is being made pursuant to the Change of
Control Repurchase Event provisions of the Notes and that all Notes tendered will be accepted for
payment;




          (ii) the purchase price and the purchase date, which shall be no earlier than 30 days and no
later than 60 days from the date such notice is mailed (the “Change of Control Repurchase Event
Payment Date”);




          (iii) that any Note not tendered will continue to accrue interest;




          (iv) that, unless the Company defaults in the payment of the Change of Control Repurchase
Event Payment, all Notes accepted for payment pursuant to the Change of Control Repurchase Event
Offer will cease to accrue interest after the Change of Control Repurchase Event Payment Date;




          (v) that Holders electing to have any Notes purchased pursuant to a Change of Control
Repurchase Event Offer will be required to surrender the Notes to the paying agent at the address
specified in the notice prior to the close of business on the third business day preceding the
Change of Control Repurchase Event Payment Date;




          (vi) that Holders will be entitled to withdraw their election if the paying agent receives,
not later than the close of business on the second business day preceding the Change of Control
Repurchase Event Payment Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that
such Holder is withdrawing his election to have the Notes purchased; and




          (vii) that Holders whose Notes are being purchased only in part will be issued new Notes equal
in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion
must be equal to $1,000 in principal amount or an integral multiple thereof.




     The Company will comply with the requirements of Rule 14e-1 under the Exchange Act, and any
other securities laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a Change of Control



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Repurchase Event. To the extent that the provisions of any securities laws or regulations
conflict with the Change of Control Repurchase Event provisions of the Notes, the Company will
comply with the applicable securities laws and regulations and will not be deemed to have breached
its obligations under the Change of Control Repurchase Event provisions of the Notes by virtue of
such conflict.




     (b) On the Change of Control Repurchase Event Payment Date, the Company will, to the extent
lawful:



          (i) accept for payment all Notes or portions of Notes properly tendered pursuant to the
Company’s offer;




          (ii) deposit with the paying agent an amount equal to the aggregate purchase price in respect
of all Notes or portions of Notes properly tendered; and




          (iii) deliver or cause to be delivered to the Trustee the Notes properly accepted, together
with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes
being purchased by the Company.




     The paying agent will promptly mail to each holder of Notes properly tendered the purchase
price for such Notes, and the Trustee will promptly authenticate and mail (or cause to be
transferred by book entry) to each holder a new Note equal to the principal amount of any
unpurchased portion of the Notes surrendered, if any; provided, that each new Note will be issued
in denominations of $1,000 or integral multiples of $1,000.



     (c) Except as described above with respect to a Change of Control Repurchase Event, the
Indenture does not contain any other provisions that permit the holders of the Notes to require the
Company to repurchase or redeem the Notes in the event of a takeover, recapitalization or similar
transaction.



     (d) The Company will not be required to make a Change of Control Repurchase Event Offer if a
third party makes an offer in the manner applicable to an offer made by the Company, at the times
and otherwise in compliance with the requirements set forth in the Indenture, and such third party
purchases all Notes properly tendered and not withdrawn under its offer.



     Section 4. Obligation to Guarantee. If at any time any of the Company’s 5.875% Senior
Notes due 2012, 5.875% Senior Notes due 2016, 6.65% Senior Notes due 2017, 6.875% Senior Notes due
2018, 7.20% Senior Notes due 2028 or 2.875% Convertible Senior Notes due 2038 (the “2.875% Notes,”
and collectively with all other senior notes, the “Existing Senior Notes”) are guaranteed by the
Guarantor pursuant to the terms of the indentures under which such Existing Senior Notes were
issued or any applicable supplemental indenture related to such Existing Senior Notes, then the
Company, the Guarantor and the Trustee shall as soon as reasonably practicable thereafter execute
and deliver a supplemental indenture to the Indenture pursuant to which the Guarantor shall
unconditionally guarantee the Notes on substantially the same terms as the Guarantor shall have
guaranteed such Existing Senior Notes; provided, however, that if the Guarantor is not required to
guarantee the 2.875% Notes or if the 2.875% Notes are no longer outstanding, then the Guarantor
shall guarantee the Notes on substantially




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the same terms as the most recently issued series of Existing Senior Notes that are
guaranteed. The Company, the Guarantor and the Trustee, as applicable, also shall execute and
deliver such other documents, instruments or certificates as are reasonably necessary or
appropriate to effect the required guarantee of the Notes.




     Section 5. Additional Covenants of the Company.



     (a) Limitation on Liens. The Company shall not, and shall not permit any of its
Subsidiaries to create or permit to exist any Lien on any Principal Property or shares of capital
stock or Indebtedness of a Subsidiary of the Company that owns or leases Principal Property,
whether owned on the date on which the Notes were originally issued or thereafter acquired,
securing any obligation unless the Company contemporaneously secures the Notes equally and ratably
with (or prior to) such obligation until such time as such obligations are no longer secured by a
Lien. The preceding sentence shall not require the Company to secure the Notes if the Lien
consists of either of the following:



          (i) Permitted Liens; or




          (ii) Liens securing Indebtedness if, after giving pro forma effect to the Incurrence of such
Indebtedness (and the receipt and application of the proceeds thereof) or the securing of
outstanding Indebtedness, the sum of (without duplication) (x) all Indebtedness of the Company and
its Subsidiaries secured by Liens on Principal Property (other than Permitted Liens) and (y) all
Attributable Indebtedness in respect of Sale and Leaseback Transactions with respect to any
Principal Property, at the time of determination does not exceed 15% of Adjusted Consolidated Net
Tangible Assets.




     (b) Limitation on Sale and Leaseback Transactions. The Company shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, enter into any Sale and Leaseback
Transaction with respect to any Principal Property unless either, (i) the Company or such
Subsidiary would be entitled to create a Lien on such Principal Property securing Indebtedness in
an amount equal to the Attributable Indebtedness with respect to such Sale and Leaseback
Transaction without securing the Notes pursuant to Section 5(a) of this Supplemental Indenture or
(ii) or the Company, within six months after the effective date of such Sale and Leaseback
Transaction, applies to the voluntary defeasance or retirement of Notes or other Indebtedness an
amount equal to the Attributable Indebtedness in respect of such Sale and Leaseback Transaction.



     (c) Stay, Extension and Usury Laws. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law or other law that would
prohibit or forgive the Company from paying all or any portion of the principal of or interest on
the Notes as contemplated herein, wherever enacted, now or at any time hereafter in force, or that
may affect the covenants or the performance of the Indenture; and the Company (to the extent it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not, by resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.



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     Section 6. Amendments to Sections 1.01, 2.07 and 2.15.



     (a) Section 1.01. Section 1.01 is hereby amended, solely with respect to the Notes,
by:



          (i) adding a definition of “Adjusted Consolidated Net Tangible Assets” as follows:





“Adjusted Consolidated Net Tangible Assets” means (without duplication), as of the
date of determination, the remainder of:




     (a) the sum of (i) discounted future net revenues from proved oil and gas
reserves of the Company and its Subsidiaries calculated in accordance with SEC
guidelines before any provincial, territorial, state, Federal or foreign income
taxes, as estimated by the Company in a reserve report prepared as of the end of the
Company’s most recently completed fiscal year for which audited financial statements
are available, as increased by, as of the date of determination, the estimated
discounted future net revenues from (A) estimated proved oil and gas reserves
acquired since such year end, which reserves were not reflected in such year end
reserve report, and (B) estimated oil and gas reserves attributable to upward
revisions of estimates of proved oil and gas reserves since such year end due to
exploration, development or exploitation activities, in each case calculated in
accordance with SEC guidelines (utilizing the prices utilized in such year end
reserve report), and decreased by, as of the date of determination, the estimated
discounted future net revenues from (C) estimated proved oil and gas reserves
produced or disposed of since such year end, and (D) estimated oil and gas reserves
attributable to downward revisions of estimates of proved oil and gas reserves since
such year end due to changes in geological conditions or other factors which would,
in accordance with standard industry practice, cause such revisions, in each case
calculated on a pre-tax basis and substantially in accordance with SEC guidelines
(utilizing the prices utilized in such year end reserve report), in each case as
estimated by the Company’s petroleum engineers or any independent petroleum
engineers engaged by the Company for that purpose; (ii) the capitalized costs that
are attributable to oil and gas properties of the Company and its Subsidiaries to
which no proved oil and gas reserves are attributable, based on the Company’s books
and records as of a date no earlier than the date of the Company’s latest available
annual or quarterly financial statements; (iii) the Net Working Capital on a date no
earlier than the date of the Company’s latest annual or quarterly financial
statements; and (iv) the greater of (A) the net book value of other tangible assets
of the Company and its Subsidiaries, as of a date no earlier than the date of the
Company’s latest annual or quarterly financial statement, and (B) the appraised
value, as estimated by independent appraisers, of other tangible assets of the
Company and its Subsidiaries, as of a date no earlier than the date of the Company’s
latest audited financial statements; minus



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     (b) the sum of (i) noncontrolling interests in consolidating subsidiaries; (ii)
any net gas balancing liabilities of the Company and its Subsidiaries reflected in
the Company’s latest audited financial statements; (iii) to the extent included in
(a)(i) above, the discounted future net revenues, calculated in accordance with SEC
guidelines (utilizing the prices utilized in the Company’s year end reserve report),
attributable to reserves which are required to be delivered to third parties to
fully satisfy the obligations of the Company and its Subsidiaries with respect to
Volumetric Production Payments (determined, if applicable, using the schedules
specified with respect thereto); and (iv) the discounted future net revenues,
calculated in accordance with SEC guidelines, attributable to reserves subject to
Dollar-Denominated Production Payments which, based on the estimates of production
and price assumptions included in determining the discounted future net revenues
specified in (a)(i) above, would be necessary to fully satisfy the payment
obligations of the Company and its Subsidiaries with respect to Dollar-Denominated
Production Payments (determined, if applicable, using the schedules specified with
respect thereto).




     If the Company changes its method of accounting from the successful efforts
method to the full cost or a similar method of accounting, “Adjusted Consolidated
Net Tangible Assets” will continue to be calculated as if the Company were still
using the successful efforts method of accounting.




     (ii) adding a definition of “Attributable Indebtedness” as follows:




“Attributable Indebtedness” in respect of a Sale and Leaseback Transaction means, as
of the time of determination, (a) if the obligation in respect of such Sale and
Leaseback Transaction is a Capitalized Lease Obligation, the amount equal to the
capitalized amount of such obligation determined in accordance with GAAP and
included in the financial statements of the lessee or (b) if the obligation in
respect of such Sale and Leaseback Transaction is not a Capitalized Lease
Obligation, the amount equal to the total Net Amount of Rent required to be paid by
the lessee under such lease during the remaining term thereof (including any period
for which the lease has been extended), discounted from the respective due dates
thereof to such determination date at the rate per annum borne by the Notes
compounded semi annually.




     (iii) adding a definition of “Change of Control” as follows:




“Change of Control” means the occurrence of any of the following events:




     (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act or any successor provisions to either of the foregoing) of
persons become the “beneficial owners” (as defined in Rule 13d-3 under the Exchange
Act, except that a person will be deemed to have “beneficial ownership” of all
shares that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or indirectly,
of more than 50% of the total voting power of the Voting Stock of the



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Company, whether as a result of the issuance of securities of the Company, any
merger, consolidation, liquidation or dissolution of the Company or otherwise; or




     (b) the sale, transfer, assignment, lease, conveyance or other disposition,
directly or indirectly, of all or substantially all the assets of the Company and
its subsidiaries, considered as a whole (other than a disposition of such assets as
an entirety or virtually as an entirety to a wholly-owned subsidiary) shall have
occurred, or the Company merges, consolidates or amalgamates with or into any other
person or any other person merges, consolidates or amalgamates with or into the
Company, in any such event pursuant to a transaction in which the outstanding Voting
Stock of the Company is reclassified into or exchanged for cash, securities or other
property, other than any such transaction where:




          (i) the outstanding Voting Stock of the Company is reclassified into or
exchanged for other Voting Stock of the Company or for Voting Stock of the surviving
corporation, and




          (ii) the holders of the Voting Stock of the Company immediately prior to such
transaction own, directly or indirectly, not less than a majority of the Voting
Stock of the Company or the surviving corporation immediately after such transaction
and in substantially the same proportion as before the transition; or




     (c) during any period, individuals who at the beginning of such period
constituted the Board of Directors (together with any new directors whose election
or appointment by such Board or whose nomination for election by the stockholders of
the Company was approved by a vote of not less than a majority of the directors then
still in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any reason
to constitute a majority of the Board of Directors then in office; or




     (d) the stockholders of the Company shall have approved any plan of liquidation
or dissolution of the Company.




     (iv) adding a definition of “Change of Control Repurchase Event” as follows:




“Change of Control Repurchase Event” means the occurrence of both a Change of
Control and a Rating Decline.




     (v) adding a definition of “Consolidated Net Worth” as follows:




“Consolidated Net Worth” of any Person means the stockholders’ equity of such Person
and its Subsidiaries, as determined on a consolidated basis in accordance with GAAP,
less (to the extent included in stockholders’ equity) amounts attributable to
Redeemable Stock of such Person or its Subsidiaries.



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          (vi) deleting the definition of “Credit Agreement” and substituting therefore the definition
that follows:





“Credit Agreement” means the Amended and Restated Credit Facility Agreement, dated
as of April 11, 2007, among the Company, as Borrower, JPMorgan Chase Bank, N.A. as
Administrative Agent, JPMorgan Chase Bank, N.A., Wachovia Bank, National Association
and Bank of America, N.A., as Issuing Banks, JPMorgan Chase Bank, N.A., and Wachovia
Bank, National Association, as Swingline Lenders, the Lenders party thereto,
Wachovia Bank, National Association, as Syndication Agent, Bank of America, N.A.,
Deutsche Bank Securities Inc. and Wells Fargo Bank, National Association, as
Co-Documentation Agents, and J.P. Morgan Securities Inc. and Wachovia Capital
Markets, LLC, as Co-Arrangers and Joint Bookrunners, as supplemented, amended or
modified or Refinanced from time to time. It is understood and agreed that the
Credit Agreement may be refinanced, refunded, extended, renewed or replaced (through
one or more such refinancings, refundings, extensions, renewals or replacements), as
a whole, or in part, from time to time after the termination of the applicable
Credit Agreement.



          (vii) adding a definition of “Dollar-Denominated Production Payments” as follows:





“Dollar-Denominated Production Payments” means production payment obligations
recorded as liabilities in accordance with GAAP, together with all undertakings and
obligations in connection therewith.



          (viii) adding a definition of “Government Contract Lien” as follows:





“Government Contract Lien” means any Lien required by any contract, statute,
regulation or order in order to permit the Company or any of its Subsidiaries to
perform any contract or subcontract made by it with or at the request of the United
States or any State thereof or any department, agency or instrumentality of either
or to secure partial, progress, advance or other payments by the Company or any of
its Subsidiaries to the United States or any State thereof or any department, agency
or instrumentality of either pursuant to the provisions of any contract, statute,
regulation or order.



          (ix) adding a definition of “Investment Grade” as follows:





“Investment Grade” means BBB- or higher by S&P and Baa3 or higher by Moody’s, or the
equivalent of such ratings by S&P or Moody’s, or, if either S&P and Moody’s shall
not make a rating on the notes publicly available, another Rating Agency.



          (x) adding a definition of “Lien” as follows:





“Lien” means any mortgage, pledge, security interest, encumbrance, lien, charge or
adverse claim affecting title or resulting in an encumbrance against real or



11









 






personal property or a security interest of any kind (including, without limitation,
any conditional sale or other title retention agreement or lease in the nature
thereof or any filing or agreement to file a financing statement as debtor under the
Uniform Commercial Code or any similar statute other than to reflect ownership by a
third party of property leased to the Company or any of its Subsidiaries under a
lease that is not in the nature of a conditional sale or title retention agreement).



          (xi) adding a definition of “Moody’s” as follows:





“Moody’s” means Moody’s Investors Service, Inc.



          (xii) adding a definition of “Net Amount of Rent” as follows:





“Net Amount of Rent” as to any lease for any period means the aggregate amount of
rent payable by the lessee with respect to such period after excluding amounts
required to be paid on account of maintenance and repairs, insurance, taxes,
assessments, water rates and similar charges. In the case of any lease that is
terminable by the lessee upon the payment of a penalty, such net amount shall also
include the amount of such penalty, but no rent shall be considered as payable under
such lease subsequent to the first date upon which it may be so terminated.



          (xiii) adding a definition of “Net Working Capital” as follows:





“Net Working Capital” means (a) all current assets of the Company and its
Subsidiaries, less (b) all current liabilities of the Company and its Subsidiaries,
except current liabilities included in Indebtedness, in each case as set forth in
consolidated financial statements of the Company prepared in accordance with GAAP.



          (xiv) adding a definition of “Non-Recourse Indebtedness” as follows:





“Non-Recourse Indebtedness” means Indebtedness or that portion of Indebtedness of
the Company incurred in connection with the acquisition by the Company of any
property and as to which:




     (a) the holders of such Indebtedness agree in writing that they will look
solely to the property so acquired and securing such Indebtedness for payment on or
in respect of such Indebtedness and




     (b) no default with respect to such Indebtedness would permit (after notice or
passage of time or both), according to the terms of any other Indebtedness of the
Company or a Subsidiary, any holder of such other Indebtedness to declare a default
under such other Indebtedness or cause the payment of such other Indebtedness to be
accelerated or payable prior to its stated maturity.



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          (xv) adding a definition of “Oil and Gas Business” as follows:





“Oil and Gas Business” means the business of exploiting, exploring for, developing,
acquiring, operating, producing, processing, gathering, marketing, storing, selling,
hedging, treating, swapping, refinancing and transporting hydrocarbon and other
related energy businesses.



          (xvi) adding a definition of “Permitted Liens” as follows:





“Permitted Liens” means, with respect to any Person, (a) pledges or deposits by
such Person under worker’s compensation laws, unemployment insurance laws or
similar legislation, or good faith deposits in connection with bids, tenders,
contracts (other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory obligations of such
Person or deposits of cash or United States government bonds to secure performance,
surety or appeal bonds to which such Person is a party or which are otherwise
required of such Person, or deposits as security for contested taxes or import
duties or for the payment of rent or other obligations of like nature, in each case
Incurred in the ordinary course of business; (b) Liens imposed by law, such as
carriers’, warehousemen’s, laborers’, materialmen’s, landlords’, vendors’,
workmen’s, operators’, producers’ (including those arising pursuant to Article
9.343 of the Texas Uniform Commercial Code or other similar statutory provisions of
other states with respect to production purchased from others) and mechanics’
Liens, in each case for sums not yet due or being contested in good faith by
appropriate proceedings; (c) Liens for property taxes, assessments and other
governmental charges or levies not yet delinquent or subject to penalties for
non-payment or which are being contested in good faith by appropriate proceedings;
(d) minor survey exceptions, minor encumbrances, easements or reservations of or
with respect to, or rights of others for or with respect to, licenses,
rights-of-way, sewers, electric and other utility lines and usages, telegraph and
telephone lines, pipelines, surface use, operation of equipment, permits,
servitudes and other similar matters, or zoning or other restrictions as to the use
of real property or Liens incidental to the conduct of the business of such Person
or to the ownership of its properties which were not Incurred in connection with
Indebtedness and which do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the
business of such Person; (e) Liens existing on or provided for under the terms of
agreements existing on the date on which the Notes were originally issued; (f)
Liens on property or assets of, or any shares of stock of or secured debt of, any
Person at the time the Company or any of its Subsidiaries acquired the property or
the Person owning such property, including any acquisition by means of a merger or
consolidation with or into the Company or any of its Subsidiaries; (g) Liens
securing a Hedging Obligation so long as such Hedging Obligation is of the type
customarily entered into in connection with, and is entered into for the purpose
of, limiting risk; (h) Liens upon specific properties of the Company or any of its
Subsidiaries securing Indebtedness Incurred in the ordinary course of business to
provide all or part of the funds for



13









 






the exploration, drilling or development of those properties; (i) Purchase Money
Liens and Liens securing Non-Recourse Indebtedness; provided, however, that the
related purchase money Indebtedness and Non-Recourse Indebtedness, as applicable,
shall not be secured by any property or assets of the Company or any Subsidiary
other than the property acquired by the Company with the proceeds of such purchase
money Indebtedness or Non-Recourse Indebtedness, as applicable; (j) Liens securing
only Indebtedness of a wholly owned Subsidiary of the Company to the Company or to
one or more wholly owned Subsidiaries of the Company; (k) Liens on any property to
secure bonds for the construction, installation or financing of pollution control
or abatement facilities or other forms of industrial revenue bond financing or
Indebtedness issued or Guaranteed by the United States, any state or any
department, agency or instrumentality thereof; (l) Government Contract Liens; (m)
Liens in respect of Production Payments and Reserve Sales; (n) Liens resulting from
the deposit of funds or evidences of Indebtedness in trust for the purpose of
defeasing Indebtedness of the Company or any of its Subsidiaries; (o) legal or
equitable encumbrances deemed to exist by reason of negative pledges or the
existence of any litigation or other legal proceeding and any related lis pendens
filing (excluding any attachment prior to judgment, judgment lien or attachment
lien in aid of execution on a judgment); (p) rights of a common owner of any
interest in property held by such Person; (q) farmout, carried working interest,
joint operating, unitization, royalty, overriding royalty, sales and similar
agreements relating to the exploration or development of, or production from, oil
and gas properties entered into the ordinary course of business; (r) any defects,
irregularities or deficiencies in title to easements, rights-of-way or other
properties which do not in the aggregate materially adversely affect the value of
such properties or materially impair their use in the operation of the business of
such Person; and (s) Liens to secure any refinancing, refunding, extension, renewal
or replacement (or successive refinancings, refundings, extensions, renewals or
replacements), as a whole, or in part, of any Indebtedness secured by any Lien
referred to in the foregoing clauses (e) through (m); provided, however, that (i)
such new Lien shall be limited to all or part of the same property that secured the
original Lien (plus improvements on such property) and (ii) the Indebtedness
secured by such Lien at such time is not increased to any amount greater than the
sum of (A) the outstanding principal amount or, if greater, committed amount of the
Indebtedness described under clauses (e) through (m) at the time the original Lien
became a Permitted Lien under the Indenture and (B) an amount necessary to pay any
fees and expenses, including premiums, related to such refinancing, refunding,
extension, renewal or replacement.



          (xvii) adding a definition of “Principal Property” as follows:





“Principal Property” means any property owned or leased by the Company or any
Subsidiary, the gross book value of which exceeds one percent of Consolidated Net
Worth.



14









 





          (xviii) adding a definition of “Production Payments and Reserve Sales” as follows:





“Production Payments and Reserve Sales” means the grant or transfer by the Company
or a Subsidiary of the Company to any Person of a royalty, overriding royalty, net
profits interest, production payment (whether volumetric or dollar denominated),
partnership or other interest in oil and gas properties, reserves or the right to
receive all or a portion of the production or the proceeds from the sale of
production attributable to such properties, including any such grants or transfers
pursuant to incentive compensation programs on terms that are reasonably customary
in the Oil and Gas Business for geologists, geophysicists and other providers of
technical services to the Company or a Subsidiary of the Company.



          (xix) adding a definition of “Purchase Money Lien” as follows:





“Purchase Money Lien” means a Lien on property securing Indebtedness Incurred by the
Company or any of its Subsidiaries to provide funds for all or any portion of the
cost of (i) acquiring such property incurred before, at the time of, or within six
months after the acquisition of such property or (ii) constructing, developing,
altering, expanding, improving or repairing such property or assets used in
connection with such property.



          (xx) adding a definition of “Rating Agency” as follows:





“Rating Agency” means each of S&P and Moody’s, or if S&P or Moody’s or both shall
not make a rating on the Notes publicly available, a nationally recognized
statistical rating agency or agencies, as the case may be, selected by the Company
(as certified by a resolution of the Company’s board of directors) which shall be
substituted for S&P or Moody’s, or both, as the case may be.



          (xxi) adding a definition of “Rating Decline” as follows:





“Rating Decline” means the rating of the Notes shall be decreased by one or more
gradations (including gradations within categories as well as between rating
categories) by each of the Rating Agencies, provided, however, if the rating of the
Notes by each of the Rating Agencies is Investment Grade, then “Rating Decline” will
mean the rating of the Notes shall be decreased by one or more gradations (including
gradations within categories as well as between rating categories) by each Rating
Agency so that the rating of the Notes by each of the Rating Agencies falls below
Investment Grade, on any date from the date of the public notice of an arrangement
that could result in a Change of Control until the end of the 30-day period
following public notice of the occurrence of the Change of Control (which 30-day
period shall be extended so long as the rating of the Notes is under publicly
announced consideration for possible downgrade by either of the Rating Agencies;
provided, that the other Rating Agency has either downgraded, or publicly announced
that it is considering downgrading, the Notes).



15









 





          (xxii) adding a definition of “Refinance” as follows:





“Refinance” means, in respect of any Indebtedness, to refinance, extend, renew,
refund, repay, prepay, redeem, defease or retire, or to issue other Indebtedness in
exchange or replacement for, such indebtedness. “Refinanced” and “Refinancing”
shall have correlative meanings.



          (xxiii) adding a definition of “S&P” as follows:





“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.



          (xxiv) adding a definition of “Sale and Leaseback Transaction” as follows:





“Sale and Leaseback Transaction” means any arrangement with any Person pursuant to
which the Company or any Subsidiary leases any Principal Property that has been or
is to be sold or transferred by the Company or the Subsidiary to such Person, other
than (i) temporary leases for a term, including renewals at the option of the
lessee, of not more than five years, (ii) leases between the Company and a
Subsidiary or between Subsidiaries, (iii) leases of Principal Property executed by
the time of, or within 12 months after the latest of, the acquisition, the
completion of construction or improvement, or the commencement of commercial
operation of the Principal Property, and (iv) arrangements pursuant to any provision
of law with an effect similar to the former Section 168(f)(8) of the Internal
Revenue Code of 1954.



          (xxv) deleting the definition of “Subsidiary” and substituting therefore the definition that
follows:




“Subsidiary” of any Person means (i) any Person of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by any Person or
one or more of the Subsidiaries of that Person or a combination thereof, and (ii)
any partnership, joint venture or other Person in which such Person or one or more
of the Subsidiaries of that Person or a combination thereof has the power to control
by contract or otherwise the board of directors or equivalent governing body or
otherwise controls such entity; provided, however, that notwithstanding the
foregoing, with respect to the Company and its Subsidiaries, the definition of
Subsidiary shall not include Pioneer Southwest Energy Partners L.P. or any
Subsidiary of Pioneer Southwest Energy Partners L.P.



          (xxvi) adding a definition of “Underwriters” as follows:





“Underwriters” has the meaning given such term in the Underwriting Agreement, dated
November 9, 2009, among the Company, and Deutsche Bank Securities Inc., J.P. Morgan
Securities Inc. and Wells Fargo Securities LLC, acting on behalf



16









 






of the several underwriters named therein, and Credit Suisse Securities (USA) LLC,
as qualified independent underwriter.



          (xxvii) adding a definition of “Volumetric Production Payments” as follows:





“Volumetric Production Payments” means production payment obligations recorded as
deferred revenue in accordance with GAAP, together with all undertakings and
obligations in connection therewith.



          (xxviii) adding a definition of “Voting Stock” as follows:





“Voting Stock” of any person means all classes of capital stock or other interests
(including partnership interests) of such person then outstanding and normally
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof.



     (b) Section 2.07. Section 2.07 is hereby amended, solely with respect to the Notes,
by adding “the Underwriters,” before “the Company” in the last sentence of Section 2.07.



     (c) Section 2.15. Section 2.15 is hereby amended, solely with respect to the Notes,
by adding “the Underwriters,” before “the Company” in the third sentence of subclause (v) of
Section 2.15(c).



     Section 7. Ratification. This Supplemental Indenture is executed and shall be
construed as an indenture supplemental to the Indenture and, as provided in the Indenture, this
Supplemental Indenture forms a part of the Indenture. Except to the extent amended by or
supplemented by this Supplemental Indenture, the Company, the Guarantor and the Trustee hereby
ratify, confirm and reaffirm the Indenture in all respects.



     Section 8. No Security Interest Created. Nothing in this Supplemental Indenture or in
the Notes, expressed or implied, shall be construed to constitute a security interest under the
Uniform Commercial Code or similar legislation, as now or hereafter enacted and in effect, in any
jurisdiction.



     Section 9. Table of Contents, Headings, Etc. The table of contents and the titles and
headings of the sections of this Supplemental Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way modify or restrict any
of the terms or provisions hereof.



     Section 10. Severability. In the event any provision of this Supplemental Indenture
or in the Notes shall be invalid, illegal or unenforceable, then (to the extent permitted by law)
the validity, legality or enforceability of the remaining provisions shall not in any way be
affected or impaired.



     Section 11. Counterparts. This Supplemental Indenture may be executed in any number
of counterparts, each of which so executed shall be an original, but all such counterparts shall
together constitute but one and the same instrument. This Supplemental Indenture may be executed
by facsimile or other electronic transmission.



17









 





     Section 12. Governing Law. The laws of the State of New York shall govern the
construction and interpretation of this Supplemental Indenture, without regard to principles of
conflicts of laws.



     Section 13. Trustee Not Responsible for Recitals or Issuance of Notes. The recitals
contained herein and in the Notes, except the Trustee’s certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or sufficiency of this
Supplemental Indenture or of the Notes. The Trustee shall not be accountable for the use or
application by the Company of Notes or the proceeds thereof.



[Signature Page Follows]




18









 





     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be signed on
their behalf by their duly authorized representatives as of the date first above written:



	 	 	 	 	 
	 	Pioneer Natural Resources Company

 	 
	 	By:  	/s/ Richard P. Dealy
 	 
	 	 	Name:  	Richard P. Dealy 	 
	 	 	Title:  	Executive Vice President, and
Chief Financial Officer 	 
	 
	 	Pioneer Natural Resources USA, Inc.

 	 
	 	By:  	/s/ Richard P. Dealy
 	 
	 	 	Name:  	Richard P. Dealy 	 
	 	 	Title:  	Executive Vice President, and
Chief Financial Officer 	 
	 
	 	Wells Fargo Bank, National Association,

as Trustee

 	 
	 	By:  	/s/ John C. Stohlmann
 	 
	 	 	Name:  	John C. Stohlmann 	 
	 	 	Title:  	Vice President 	 
	 



SIGNATURE PAGE

SECOND SUPPLEMENTAL INDENTURE