Exhibit 4.2


 




 





BERRY
PETROLEUM COMPANY, as Issuer


 


AND


 


WELLS
FARGO BANK, NATIONAL ASSOCIATION, as Trustee


 










 


First
Supplemental Indenture


 










 


Dated
as of May 27, 2009


 


$325,000,000


 


101⁄4%
SENIOR NOTES DUE 2014




 





 





















 


TABLE
OF CONTENTS


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE ONE ESTABLISHMENT OF SERIES

  	
  2

  
	
  SECTION 1.01

  	
  Establishment

  	
  2

  
	
  SECTION 1.02

  	
  Book-Entry
  Provisions

  	
  3

  
	
  SECTION 1.03

  	
  Definitive
  Securities

  	
  4

  
	
   

  	
   

  
	
  ARTICLE TWO DEFINITIONS AND OTHER
  PROVISIONS OF GENERAL APPLICATION

  	
  4

  
	
  SECTION 2.01

  	
  Amendments
  to Definitions

  	
  4

  
	
  SECTION 2.02

  	
  Definitions

  	
  4

  
	
  SECTION 2.03

  	
  Other
  Definitions

  	
  37

  
	
   

  	
   

  
	
  ARTICLE THREE EVENTS OF DEFAULT WITH
  RESPECT TO THE NOTES

  	
  38

  
	
  SECTION 3.01

  	
  Original
  Indenture

  	
  38

  
	
  SECTION 3.02

  	
  Events of
  Default

  	
  38

  
	
  SECTION 3.03

  	
  Acceleration

  	
  41

  
	
  SECTION 3.04

  	
  Control
  by Holders

  	
  41

  
	
   

  	
   

  
	
  ARTICLE FOUR CONSOLIDATION, MERGER,
  CONVEYANCE, TRANSFER OR LEASE WITH RESPECT TO THE NOTES

  	
  42

  
	
  SECTION 4.01

  	
  Original
  Indenture

  	
  42

  
	
  SECTION 4.02

  	
  Company
  May Consolidate, Etc., Only on Certain Terms

  	
  42

  
	
  SECTION 4.03

  	
  Successor
  Substituted

  	
  43

  
	
  SECTION 4.04

  	
  Subsidiary
  Guarantors May Consolidate, Etc., Only on Certain Terms

  	
  43

  
	
   

  	
   

  
	
  ARTICLE FIVE SUPPLEMENTAL INDENTURES
  WITH RESPECT TO THE NOTES

  	
  44

  
	
  SECTION 5.01

  	
  Original
  Indenture

  	
  44

  
	
  SECTION 5.02

  	
  Supplemental
  Indentures Without Consent of Holders

  	
  44

  
	
  SECTION 5.03

  	
  Supplemental
  Indentures With Consent of Holders

  	
  45

  
	
   

  	
   

  
	
  ARTICLE SIX COVENANTS WITH RESPECT TO
  THE NOTES

  	
  46

  
	
  SECTION 6.01

  	
  Original
  Indenture

  	
  46

  
	
  SECTION 6.02

  	
  Payment
  of Principal, Premium and Interest

  	
  46

  
	
  SECTION 6.03

  	
  Existence

  	
  47

  
	
  SECTION 6.04

  	
  Statement
  by Officers as to Default

  	
  47

  
	
  SECTION 6.05

  	
  Effectiveness
  of Covenants

  	
  47

  
	
  SECTION 6.06

  	
  Limitation
  on Indebtedness

  	
  48

  
	
  SECTION 6.07

  	
  Calculation of Original Issue Discount

  	
  53

  
	
  SECTION 6.08

  	
  Limitation
  on Restricted Payments

  	
  53

  
	
  SECTION 6.09

  	
  Limitation
  on Liens

  	
  59

  



 


i

















 


	
  SECTION 6.10

  	
  Limitation on Restrictions on
  Distributions from Restricted Subsidiaries

  	
  59

  
	
  SECTION 6.11

  	
  Limitation
  on Sales of Assets and Subsidiary Stock

  	
  61

  
	
  SECTION 6.12

  	
  Limitation
  on Affiliate Transactions

  	
  64

  
	
  SECTION 6.13

  	
  Limitation
  on Sale of Capital Stock of Restricted Subsidiaries

  	
  66

  
	
  SECTION 6.14

  	
  Change of
  Control

  	
  67

  
	
  SECTION 6.15

  	
  Commission
  Reports

  	
  68

  
	
  SECTION 6.16

  	
  Future
  Subsidiary Guarantors

  	
  69

  
	
  SECTION 6.17

  	
  Limitation
  on Lines of Business

  	
  69

  
	
   

  	
   

  	
   

  
	
  ARTICLE SEVEN REDEMPTION OF NOTES

  	
  69

  
	
  SECTION 7.01

  	
  Original
  Indenture

  	
  69

  
	
  SECTION 7.02

  	
  Selection
  by Trustee of Notes to Be Redeemed

  	
  69

  
	
  SECTION 7.03

  	
  Notes
  Payable on Redemption Date

  	
  70

  
	
  SECTION 7.04

  	
  Other
  Mandatory Redemption

  	
  70

  
	
  SECTION 7.05

  	
  Optional
  Redemption

  	
  70

  
	
   

  	
   

  	
   

  
	
  ARTICLE EIGHT DEFEASANCE AND COVENANT
  DEFEASANCE WITH RESPECT TO THE NOTES

  	
  71

  
	
  SECTION 8.01

  	
  Original
  Indenture

  	
  71

  
	
  SECTION 8.02

  	
  Discharge
  of Liability on Notes; Defeasance

  	
  71

  
	
  SECTION 8.03

  	
  Conditions
  to Defeasance

  	
  72

  
	
  SECTION 8.04

  	
  Application
  of Trust Money

  	
  73

  
	
  SECTION 8.05

  	
  Repayment
  to Company

  	
  73

  
	
  SECTION 8.06

  	
  Indemnity
  for U.S. Government Obligations

  	
  73

  
	
  SECTION 8.07

  	
  Reinstatement

  	
  74

  
	
   

  	
   

  	
   

  
	
  ARTICLE NINE SUBSIDIARY GUARANTEE

  	
  74

  
	
  SECTION 9.01

  	
  Subsidiary
  Guarantee

  	
  74

  
	
  SECTION 9.02

  	
  Termination,
  Release and Discharge

  	
  75

  
	
  SECTION 9.03

  	
  Limitation
  of Subsidiary Guarantors’ Liability

  	
  76

  
	
  SECTION 9.04

  	
  Contribution

  	
  77

  
	
   

  	
   

  	
   

  
	
  ARTICLE TEN MISCELLANEOUS PROVISIONS
  WITH RESPECT TO THE NOTES

  	
  77

  
	
  SECTION 10.01

  	
  Effect of
  Headings and Table of Contents

  	
  77

  
	
  SECTION 10.02

  	
  Successors
  and Assigns

  	
  77

  
	
  SECTION 10.03

  	
  Separability
  Clause

  	
  77

  
	
  SECTION 10.04

  	
  Governing
  Law

  	
  77

  
	
  SECTION 10.05

  	
  No
  Adverse Interpretation of Other Agreements

  	
  77

  
	
  SECTION 10.06

  	
  Counterparts

  	
  77

  
	
  SECTION 10.07

  	
  Notices

  	
  78

  



 


	
  Exhibit A

  	
  —

  	
  Form of Note

  
	
  Exhibit B

  	
  —

  	
  Form of Supplemental Indenture for Future
  Subsidiary Guarantees

  
	
  Schedule 1

  	
  —

  	
  Existing Affiliate Transactions

  



 


ii

















 


This FIRST SUPPLEMENTAL
INDENTURE, dated as of May 27, 2009 between Berry Petroleum Company, a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the “Company”), having its
principal office at 1999 Broadway, Suite 3700, Denver, Colorado 80202, and
Wells Fargo Bank, National Association, a national banking association duly
organized and existing under the laws of the United States of America, as
trustee (herein called the “Trustee”).


 


Recitals
of the Company


 


WHEREAS, the Company and the
Trustee executed and delivered an Indenture, dated as of June 15, 2006
(the “Original Indenture”), to
provide for the issuance by the Company from time to time of its debentures,
notes or other evidences of indebtedness (as defined therein, “Securities”), which may be issued in
one or more series as provided in the Original Indenture;


 


WHEREAS, the Original
Indenture is incorporated herein by this reference, and the Original Indenture,
as supplemented by this First Supplemental Indenture and any other supplemental
indentures applicable to the Securities created pursuant to this First
Supplemental Indenture, is herein called the “Indenture”;


 


WHEREAS, under the Original
Indenture, a new series of Securities may at any time be established in or
pursuant to a Board Resolution, an Officer’s Certificate or one or more
indentures supplemental to the Original Indenture;


 


WHEREAS, the Company
proposes to create under the Indenture a new series of Securities designated as
101⁄4% Senior Notes due 2014 and to add new provisions to, and change and
eliminate certain existing provisions of, the Original Indenture in respect of (i) such
new series of Securities and (ii) as and to the extent specified herein,
any additional series of Securities of other series hereafter established and
issued pursuant to the Indenture as at the time supplemented and modified;


 


WHEREAS, additional
Securities of other series hereafter established, except as may be limited in
the Original Indenture as at the time supplemented and modified, may be issued
from time to time pursuant to the Indenture as at the time supplemented and
modified;


 


WHEREAS, no Security of any
series has been created prior to the date of execution of this First
Supplemental Indenture; and


 


WHEREAS, all conditions
necessary to authorize the execution and delivery of this First Supplemental
Indenture and make it a valid and binding obligation of the Company in
accordance with its terms, have been done or performed.


 


NOW, THEREFORE, THIS FIRST
SUPPLEMENTAL INDENTURE WITNESSETH:


 


For and in consideration of
the premises set forth herein and for other good and valuable consideration the
sufficiency of which is hereby acknowledged, it is mutually agreed as follows:


 


1

















 


ARTICLE ONE

ESTABLISHMENT OF SERIES


 


SECTION 1.01              Establishment.


 


There is hereby established
a new series of Securities to be issued under the Indenture, to be designated
as the Company’s 101⁄4% Senior Notes due 2014 (the “Notes”).  This First Supplemental Indenture shall be
deemed to satisfy all requirements of Section 301 of the Original
Indenture necessary for establishment of the Notes as a series of Securities
under the Indenture notwithstanding anything to the contrary therein.


 


There are to be
authenticated and delivered Notes, initially limited in aggregate principal
amount of $325,000,000 and no further Notes shall be authenticated and
delivered except as provided by the terms of the Original Indenture and the
terms of this First Supplemental Indenture; provided, however,
that additional Notes having identical terms and conditions as the Notes other
than issue date, the issue price, the date from which interest thereon shall
accrue, legends, if any, to be included thereon and the first Interest Payment
Date (the “Additional Notes”) may be
issued from time to time in the future, without the consent of the Holders of
the Notes, in accordance with the provisions of the Indenture. With respect to
any Additional Notes, the Company shall set forth in a resolution of the Board
of Directors or an Officers’ Certificate, the following information:


 


(a)           the
aggregate principal amount of such Additional Notes to be authenticated and
delivered pursuant to the Indenture;


 


(b)           the
issue date, the issue price, the first Interest Payment Date of such Additional
Notes, the date from which interest shall accrue and legends, if any, to be
included thereon; and


 


(c)           the
CUSIP and ISIN numbers of the Additional Notes.


 


The Notes and the Additional
Notes, if any, shall be considered collectively as a single class for all
purposes of the Indenture. Holders of the Notes and the Additional Notes, if
any, shall vote and consent together on all matters to which such Holders are
entitled to vote or consent as one class, and none of the Holders of the Notes
or the Additional Notes, if any, shall have the right to vote or consent as a
separate class on any matter to which such Holders are entitled to vote or
consent.


 


The Notes shall be issued in
fully registered form without coupons, and only in denominations of $2,000 and
larger integral multiples of $1,000. The Notes shall be issued in the form of
one or more Global Securities in substantially the form set out in Exhibit A
hereto. The initial Depositary with respect to the Notes shall be DTC. Payments
in respect of Notes represented by a Global Security (including principal,
premium and interest) shall be made by wire transfer of immediately available
funds to the accounts specified by DTC.


 


Each Note shall be dated the
date of authentication thereof and shall bear interest from the date of
original issuance thereof or from the most recent Interest Payment Date to
which interest has been paid or duly provided for.


 


2

















 


The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage or DTC rule or usage in addition to those set forth on Exhibit A.
The Company and the Trustee shall approve the forms of the Notes and any
notation, endorsement or legend on them, such approval to be evidenced by the
execution or authentication, respectively, and delivery of the Notes by the
Company or the Trustee, respectively. The terms of the Notes set forth in Exhibit A
are part of the terms of the Indenture and, to the extent applicable, the
Company and the Trustee, by their execution and delivery of this First
Supplemental Indenture, expressly agree to be bound by such terms.


 


SECTION 1.02              Book-Entry
Provisions.


 


This Section 1.02
shall apply only to Global Securities deposited with the Trustee, as custodian
for DTC.


 


Each Global Security
initially shall (x) be registered in the name of DTC for such Global
Security or the nominee of DTC, (y) be delivered to the Trustee as
custodian for DTC and (z) bear legends as set forth in Section 202 of
the Original Indenture.


 


Members of, or participants
in, DTC (“Agent Members”) shall have no
rights under the Indenture with respect to any Global Security held on their
behalf by DTC or by the Trustee as the custodian of DTC or under such Global
Security, and DTC may be treated by the Company, the Trustee and any agent of
the Company or the Trustee as the absolute owner of such Global Security for
all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by DTC or impair, as between DTC and its Agent Members, the operation
of customary practices of DTC governing the exercise of the rights of a Holder
of a beneficial interest in any Global Security.


 


In connection with any
transfer of a portion of the beneficial interest in a Global Security pursuant
to Section 1.03 of this First Supplemental Indenture to beneficial
owners who are required to hold Definitive Securities, the Securities Custodian
shall reflect on its books and records the date and a decrease in the principal
amount of such Global Security in an amount equal to the principal amount of
the beneficial interest in the Global Security to be transferred, and the Company
shall execute, and the Trustee shall authenticate and deliver, one or more
Definitive Securities of like tenor and amount.


 


In connection with the
transfer of an entire Global Security to beneficial owners pursuant to Section 1.03
of this First Supplemental Indenture, such Global Security shall be deemed to
be surrendered to the Trustee for cancellation, and the Company shall execute,
and the Trustee shall authenticate and deliver, to each beneficial owner
identified by DTC in exchange for its beneficial interest in such Global
Security, an equal aggregate principal amount of Definitive Securities of
authorized denominations.


 


The registered Holder of a
Global Security may grant proxies and otherwise authorize any Person, including
Agent Members and Persons that may hold interests through Agent Members, to
take any action which a Holder is entitled to take under the Indenture or the
Notes.


 


3

















 


SECTION 1.03              Definitive
Securities.


 


Except as provided below,
owners of beneficial interests in Global Securities shall not be entitled to
receive Definitive Securities. If required to do so pursuant to any applicable
law or regulation, beneficial owners may obtain Definitive Securities in
exchange for their beneficial interests in a Global Security upon written
request in accordance with DTC’s and the Registrar’s procedures. In addition,
Definitive Securities shall be transferred to all beneficial owners in exchange
for their beneficial interests in a Global Security if (a) DTC notifies
the Company that it is unwilling or unable to continue as depositary for such
Global Security or DTC ceases to be a clearing agency registered under the
Exchange Act, at a time when DTC is required to be so registered in order to
act as depositary, and in each case a successor depositary is not appointed by
the Company within 90 days of such notice or, (b) the Company executes and
delivers to the Trustee and Registrar an Officers’ Certificate stating that
such Global Security shall be so exchangeable or (c) an Event of Default
has occurred and is continuing and the Registrar has received a request from
DTC.


 


In connection with the
exchange of a portion of a Definitive Security for a beneficial interest in a
Global Security, the Trustee shall cancel such Definitive Security, and the
Company shall execute, and the Trustee shall authenticate and deliver, to the
transferring Holder a new Definitive Security representing the principal amount
not so transferred.


 


ARTICLE TWO

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION


 


SECTION 2.01              Amendments
to Definitions.


 


Each capitalized term used
but not defined in this First Supplemental Indenture shall have the meaning
given to it in the Original Indenture, except that with respect to the Notes, the
terms defined in this Supplemental Indenture shall have the meanings set forth
herein in lieu of the meaning of such term in the Original Indenture.


 


SECTION 2.02              Definitions.


 


The following defined terms
used herein with respect to the Notes shall, unless the context otherwise
requires, have the meanings specified below (notwithstanding any other meaning
given to such terms in the Original Indenture):


 


“Acquired
Indebtedness” means Indebtedness (1) of a Person or any of
its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or (2) assumed in connection with the acquisition of assets
from such Person, in each case whether or not Incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary or such acquisition. Acquired Indebtedness shall be
deemed to have been Incurred, with respect to clause (1) of
the preceding sentence, on the date such Person becomes a Restricted Subsidiary
and, with respect to clause (2) of the preceding sentence, on
the date of consummation of such acquisition of assets.


 


4

















 


“Additional
Assets” means:


 


(1)           any property, plant,
equipment or other asset (excluding current assets) to be used by the Company
or a Restricted Subsidiary in a Related Business;


 


(2)           capital expenditures by the
Company or a Restricted Subsidiary in a Related Business;


 


(3)           the Capital Stock of a
Person that becomes a Restricted Subsidiary as a result of the acquisition of such
Capital Stock by the Company or a Restricted Subsidiary; or


 


(4)           Capital Stock constituting a
minority interest in any Person that at such time is a Restricted Subsidiary;


 


provided, however, that, in the
case of clauses (3) and (4), such Restricted Subsidiary
is primarily engaged in a Related Business.


 


“Additional
Interest” means additional interest at a rate of 0.50% per
annum.


 


“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 Restricted Subsidiaries calculated in
accordance with Commission 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 Commission guidelines (utilizing the prices for the fiscal
quarter ending prior to the date of determination),


 


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 


 


5

















 


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 Commission guidelines
(utilizing the prices for the fiscal quarter ending prior to the date of
determination), 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 Restricted 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 Restricted Subsidiaries, as of a date no earlier than the date
of the Company’s latest annual or quarterly financial statements, and


 


(B)           the appraised value, as estimated by independent
appraisers, of other tangible assets of the Company and its Restricted
Subsidiaries, as of a date no earlier than the date of the Company’s latest
audited financial statements;


 


minus


 


(b)           the sum of:


 


(i)            Minority Interests;


 


(ii)           any net gas balancing liabilities of the Company and
its Restricted 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 Commission
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 Restricted
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 Commission 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 


 


6

















 


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


 


“Adjusted
Net Assets” of a Subsidiary Guarantor at any date means the
amount by which the fair value of the properties of such Subsidiary Guarantor
exceeds the total amount of liabilities, including contingent liabilities
(after giving effect to all other fixed and contingent liabilities incurred or
assumed on such date), but excluding liabilities under its Subsidiary
Guarantee, of such Subsidiary Guarantor at such date.


 


“Affiliate”
of any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with
such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power
to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms “controlling” and “controlled” have meanings correlative to the foregoing; provided that exclusively for purposes of Section 6.12
of this First Supplemental Indenture, beneficial ownership of 10% or more of
the Voting Stock of a Person shall be deemed to be control.


 


“Applicable
Premium” means, with respect to a Note on any date of redemption,
the greater of (1) 1.0% of the principal amount of such Note and (2) the
excess of (a) the present value at such time of all remaining scheduled
payments of principal and interest on such Note (but excluding accrued and
unpaid interest to the redemption date), computed using a discount rate equal
to the Treasury Rate plus 50 basis points, over (b) the then-outstanding
principal amount of such Note.


 


“Asset
Disposition” means any direct or indirect sale, lease (other
than an operating lease entered into in the ordinary course of business),
transfer, issuance or other disposition, or a series of related sales, leases,
transfers, issuances or dispositions that are part of a common plan, of shares
of Capital Stock of a Subsidiary (other than Foreign Required Minority Shares),
property or other assets (each referred to for the purposes of this definition
as a “disposition”) by the Company
or any of its Restricted Subsidiaries, including any disposition by means of a
merger, consolidation or similar transaction, in each case after the Issue
Date.


 


Notwithstanding the
preceding, the following items shall not be deemed to be Asset Dispositions:


 


(1)           a disposition of assets by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Restricted Subsidiary;


 


(2)           a disposition of Cash
Equivalents in the ordinary course of business;


 


(3)           a disposition of
Hydrocarbons or Related Assets in the ordinary course of business;


 


7
















 


(4)           a disposition of obsolete or
worn out equipment or equipment that is no longer useful in the conduct of the
business of the Company and its Restricted Subsidiaries and that is disposed of
in each case in the ordinary course of business;


 


(5)           transactions subject to and
permitted under Article Four of this First Supplemental Indenture;


 


(6)           an issuance of Capital Stock
by a Restricted Subsidiary to the Company or to a Restricted Subsidiary;


 


(7)           for purposes of Section 6.11
of this First Supplemental Indenture only, the making of a Permitted Investment
(but, in the case of an Investment in which the Company or a Restricted
Subsidiary receives consideration for such transaction including cash or Cash
Equivalents, such transaction shall be deemed to also include an Asset
Disposition having a fair market value equal to the aggregate amount of cash
and Cash Equivalents so received) or a disposition subject to and in compliance
with Section 6.08 of this First Supplemental Indenture;


 


(8)           an Asset Swap effected in
compliance with Section 6.11 of this First Supplemental Indenture;


 


(9)           dispositions of assets with
an aggregate fair market value since the Issue Date of less than $5.0 million;


 


(10)         the creation of a Permitted
Lien and dispositions in connection with Permitted Liens;


 


(11)         dispositions of receivables
in connection with the compromise, settlement or collection thereof in the
ordinary course of business or in bankruptcy or similar proceedings and
exclusive of factoring or similar arrangements;


 


(12)         the issuance by a Restricted
Subsidiary of Preferred Stock that is permitted by Section 6.06 of
this First Supplemental Indenture;


 


(13)         the licensing or
sublicensing of intellectual property or other general intangibles and
licenses, leases or subleases of other property in the ordinary course of
business which do not materially interfere with the business of the Company and
its Restricted Subsidiaries;


 


(14)         foreclosure on assets;


 


(15)         any Production Payments and
Reserve Sales that are customary in the Oil and Gas Business;


 


(16)         a disposition of Permitted
Investments of the type described in clause (7) of the
definition thereof;


 


8

















 


(17)         a disposition of Oil and Gas
Properties in connection with tax credit transactions complying with Section 29
or any successor or analogous provisions of the Code;


 


(18)         surrender or waiver of
contract rights or the settlement, release or surrender of contract, tort or
other claims of any kind;


 


(19)         for purposes of clause (2) of
Section 6.11(a) of this First Supplemental Indenture only,
dispositions of equipment in the form of Capitalized Lease Obligations or
mortgage or purchase money financing in an aggregate principal amount not to
exceed $25.0 million at any time outstanding; provided
that any proceeds received in connection with any such transaction must be
applied in accordance with Section 6.11 of this First Supplemental
Indenture; and


 


(20)         Sale/Leaseback Transactions
relating to assets acquired after the Issue Date; provided
that each such Sale/Leaseback Transaction is consummated within 180 days after
the date of the acquisition of such asset by the Company or such Restricted
Subsidiary (each, a “Qualifying SLB”).


 


“Asset
Swap” means a concurrent purchase and sale or exchange of Oil
and Gas Properties between the Company or any of its Restricted Subsidiaries
and another Person; provided that
any cash received must be applied in accordance with Section 6.11
of this First Supplemental Indenture.


 


“Attributable
Indebtedness” in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate implicit in the transaction) of the total obligations of the lessee for
rental payments during the remaining term of the lease included in such
Sale/Leaseback Transaction (including any period for which such lease has been
extended), determined in accordance with GAAP; provided,
however, that if such Sale/Leaseback Transaction results in a
Capitalized Lease Obligation, the amount of Indebtedness represented thereby
shall be determined in accordance with the definition of “Capitalized
Lease Obligations”, and provided, further,
obligations relating to Qualifying SLBs shall be deemed not to be Attributable
Indebtedness.


 


“Average
Life” means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (1) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness
or redemption or similar payment with respect to such Preferred Stock
multiplied by the amount of such payment by (2) the sum of all such
payments.


 


“Board
of Directors” means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.


 


“Business
Day” means each day that is not a Saturday, Sunday or other day
on which banking institutions in New York, New York are authorized or required
by law to close.


 


“Capital
Stock” of any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated)


 


9

















 


equity
of such Person, including any Preferred Stock and limited liability or
partnership interests (whether general or limited), but excluding any debt
securities convertible into such equity.


 


“Capitalized
Lease Obligations” means an obligation that is required to be
classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented by
such obligation shall be the capitalized amount of such obligation at the time
any determination thereof is to be made as determined in accordance with GAAP,
and the Stated Maturity thereof shall be the date of the last payment of rent
or any other amount due under such lease prior to the first date such lease may
be terminated without penalty.


 


“Cash
Equivalents” means:


 


(1)           securities issued or
directly and fully guaranteed or insured by the United States Government or any
agency or instrumentality of the United States (provided
that the full faith and credit of the United States is pledged in support
thereof), having maturities of not more than one year from the date of
acquisition;


 


(2)           marketable general
obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof (provided that the full faith and credit of the United States
is pledged in support thereof) and, at the time of acquisition, having a credit
rating of “A” or better from either Standard & Poor’s Ratings Group, Inc.
or Moody’s Investors Service, Inc.;


 


(3)           certificates of deposit,
time deposits, eurodollar time deposits, overnight bank deposits or bankers’
acceptances having maturities of not more than one year from the date of
acquisition thereof issued by any commercial bank the long-term debt of which
is rated at the time of acquisition thereof at least “A” or the equivalent
thereof by Standard & Poor’s Ratings Group, Inc., or “A” or the
equivalent thereof by Moody’s Investors Service, Inc., and having combined
capital and surplus in excess of $500 million;


 


(4)           repurchase obligations with
a term of not more than 30 days for underlying securities of the types
described in clauses (1), (2) and (3) entered
into with any bank meeting the qualifications specified in clause (3) above;


 


(5)           commercial paper rated at
the time of acquisition thereof at least “A-2” or the equivalent thereof by
Standard & Poor’s Ratings Group, Inc. or “P-2” or the equivalent
thereof by Moody’s Investors Service, Inc., or carrying an equivalent rating
by a nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of investments, and in any case maturing
within one year after the date of acquisition thereof; and


 


(6)           interests in any investment
company or money market fund which invests 95% or more of its assets in
instruments of the type specified in clauses (1) through (5) above.


 


10

















 


“Change
of Control” means:


 


(1)           any “person”
or “group” of related persons (as such terms
are used in Sections 13(d) and 14(d) of the Exchange Act), other than
one or more Permitted Holders, becomes the beneficial owner (as defined in Rules 13d-3
and 13d-5 under the Exchange Act, except that such person or group shall be
deemed to have “beneficial ownership” of all
shares that any such person or group has the right to acquire, whether such
right is exercisable immediately or only after the passage of time), directly
or indirectly, of more than 35% of the total voting power of the Voting Stock
of the Company (or its successor by merger, consolidation or purchase of all or
substantially all of its assets) (for the purposes of this clause, such person
or group shall be deemed to beneficially own any Voting Stock of the Company
held by a parent entity, if such person or group “beneficially
owns” (as defined above), directly or indirectly, more than 35% of
the voting power of the Voting Stock of such parent entity); or


 


(2)           the first day on which a
majority of the members of the Board of Directors of the Company are not
Continuing Directors; or


 


(3)           the sale, lease, transfer,
conveyance or other disposition (other than by way of merger or consolidation),
in one or a series of related transactions, of all or substantially all of the
assets of the Company and its Restricted Subsidiaries taken as a whole to any “person” (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) other than a Permitted Holder; or


 


(4)           the adoption by the
stockholders of the Company of a plan or proposal for the liquidation or
dissolution of the Company.


 


“Change
of Control Offer” shall have the meaning set forth in Section 6.14
of this First Supplemental Indenture.


 


“Change
of Control Payment Date” shall have the meaning set forth in Section 6.14
of this First Supplemental Indenture.


 


“Code”
means the Internal Revenue Code of 1986, as amended.


 


“Commodity
Agreement” means any commodity futures contract, commodity swap,
commodity option or other similar agreement or arrangement, including options,
swaps, floors, caps, collars, futures, forward sales or forward purchases
involving commodities (including Hydrocarbons and Related Assets),
commodity-related revenues or costs (including basis), equities, bonds, or
indexes based on any of the foregoing and any other derivative agreement or
arrangement based on any of the foregoing.


 


“Common
Stock” means with respect to any Person, any and all shares,
interest or other participations in, and other equivalents (however designated
and whether voting or nonvoting) of such Person’s common stock whether or not
outstanding on the Issue Date, and includes, without limitation, all series and
classes of such common stock.


 


11

















 


“Consolidated
Cash Flow” for any period means, without duplication, the
Consolidated Net Income for such period, plus the following to the extent
deducted in calculating such Consolidated Net Income:


 


(1)           Consolidated Interest
Expense; plus


 


(2)           Consolidated Income Taxes;
plus


 


(3)           consolidated depletion and
depreciation expense; plus


 


(4)           consolidated amortization
expense or impairment charges recorded in connection with the application of
Financial Accounting Standard No. 142 “Goodwill and Other Intangibles” and
Financial Accounting Standard No. 144 “Accounting for the Impairment or
Disposal of Long Lived Assets” and similar provisions; plus


 


(5)           other non-cash charges
reducing Consolidated Net Income (excluding any such non-cash charge to the
extent it represents an accrual of or reserve for cash charges in any future
period or amortization of a prepaid cash expense that was paid in a prior
period not included in the calculation); plus


 


(6)           consolidated exploration
expense;


 


minus the sum of:


 


(A)          non-cash items increasing
Consolidated Net Income of such Person for such period (excluding any items
which represent the reversal of any accrual of, or reserve for, anticipated
cash charges made in any prior period); and


 


(B)           to the extent included in
calculating such Consolidated Net Income and in excess of any costs or expenses
attributable thereto that were deducted in calculating such Consolidated Net
Income, the sum of (x) the amount of deferred revenues that are amortized
during such period and are attributable to reserves that are subject to
Volumetric Production Payments, and (y) amounts recorded in accordance
with GAAP as repayments of principal and interest pursuant to
Dollar-Denominated Production Payments.


 


Notwithstanding the
preceding sentence, clauses (2) through (6) relating
to amounts of a Restricted Subsidiary of a Person shall be added to
Consolidated Net Income to compute Consolidated Cash Flow of such Person only
to the extent (and in the same proportion) that the net income (loss) of such
Restricted Subsidiary was included in calculating the Consolidated Net Income
of such Person and, to the extent the amounts set forth in clauses (2) through
(6) are in excess of those necessary to offset a net loss of such
Restricted Subsidiary or if such Restricted Subsidiary has net income for such
period included in Consolidated Net Income, only if a corresponding amount
would be permitted at the date of determination to be dividended to the Company
by such Restricted Subsidiary without prior approval (that has not been
obtained), pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders,


 


12

















 


statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.


 


“Consolidated
Coverage Ratio” means as of any date of determination, with
respect to any Person, the ratio of (x) the aggregate amount of
Consolidated Cash Flow of such Person for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which financial statements are in existence to (y) Consolidated Interest
Expense for such four fiscal quarters, provided, however,
that:


 


(1)           if the Company or any
Restricted Subsidiary:


 


(a)           has Incurred any
Indebtedness since the beginning of such period that remains outstanding on
such date of determination or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness,
Consolidated Cash Flow and Consolidated Interest Expense for such period shall
be calculated after giving effect on a pro forma basis to such Indebtedness as
if such Indebtedness had been Incurred on the first day of such period (except
that in making such computation, the amount of Indebtedness under any revolving
credit facility outstanding on the date of such calculation shall be deemed to
be (i) the average daily balance of such Indebtedness during such four
fiscal quarters or such shorter period for which such facility was outstanding
or (ii) if such facility was created after the end of such four fiscal
quarters, the average daily balance of such Indebtedness during the period from
the date of creation of such facility to the date of such calculation) and the
discharge of any other Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period; and


 


(b)           has repaid, repurchased,
defeased or otherwise discharged any Indebtedness since the beginning of the
period that is no longer outstanding on such date of determination or if the
transaction giving rise to the need to calculate the Consolidated Coverage
Ratio involves a discharge of Indebtedness (in each case, other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and the related commitment
terminated), Consolidated Cash Flow and Consolidated Interest Expense for such
period shall be calculated after giving effect on a pro forma basis to such
discharge of such Indebtedness, including with the proceeds of such new
Indebtedness, as if such discharge had occurred on the first day of such
period;


 


(2)           if since the beginning of
such period the Company or any Restricted Subsidiary shall have made any Asset
Disposition or disposed of any company, division, operating unit, segment,
business, group of related assets or line of business or if the transaction
giving rise to the need to calculate the Consolidated Coverage Ratio is such an
Asset Disposition:


 


13

















 


(a)           the Consolidated Cash Flow
for such period shall be reduced by an amount equal to the Consolidated Cash
Flow (if positive) directly attributable to the assets which are the subject of
such disposition for such period or increased by an amount equal to the
Consolidated Cash Flow (if negative) directly attributable thereto for such
period; and


 


(b)           Consolidated Interest
Expense for such period shall be reduced by an amount equal to the Consolidated
Interest Expense directly attributable to any Indebtedness of the Company or
any Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged
with respect to the Company and its continuing Restricted Subsidiaries in
connection with such disposition for such period (or, if the Capital Stock of
any Restricted Subsidiary is sold, the Consolidated Interest Expense for such
period directly attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Restricted Subsidiaries are no
longer liable for such Indebtedness after such sale);


 


(3)           if since the beginning of
such period the Company or any Restricted Subsidiary (by merger or otherwise)
shall have made an Investment in any Restricted Subsidiary (or any Person which
becomes a Restricted Subsidiary or is merged with or into the Company or a
Restricted Subsidiary) or an acquisition of assets, including any acquisition
of assets occurring in connection with a transaction causing a calculation to
be made hereunder, which constitutes all or substantially all of a company,
division, operating unit, segment, business, group of related assets or line of
business, Consolidated Cash Flow and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto (including the
Incurrence of any Indebtedness) as if such Investment or acquisition occurred
on the first day of such period; and


 


(4)           if since the beginning of
such period any Person (that subsequently became a Restricted Subsidiary or was
merged with or into the Company or any Restricted Subsidiary since the
beginning of such period) shall have Incurred any Indebtedness or discharged
any Indebtedness, made any disposition or any Investment or acquisition of
assets that would have required an adjustment pursuant to clause (1),
(2) or (3) above if made by the Company or a Restricted
Subsidiary during such period, Consolidated Cash Flow and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto as if such Person had been a Restricted Subsidiary on the first day of
such period and such transaction or transactions had occurred on the first day
of such period.


 


For purposes of this
definition, whenever pro forma effect is to be given to any calculation under
this definition, the pro forma calculations shall be determined in good faith
by a responsible financial or accounting officer of the Company (including pro
forma expense and cost reductions calculated on a basis consistent with
Regulation S-X under the Securities Act). If any Indebtedness bears a floating
rate of interest and is being given pro forma effect, the interest expense on
such Indebtedness shall be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into
account any Interest


 


14

















 


Rate Agreement applicable to
such Indebtedness to the extent of the remaining term thereof). If any
Indebtedness that is being given pro forma effect bears an interest rate at the
option of the Company, the interest rate shall be calculated by applying such
optional rate chosen by the Company.


 


“Consolidated
Income Taxes” means, with respect to any Person for any period,
taxes imposed upon such Person or other payments required to be made by such
Person by any governmental authority which taxes or other payments are
calculated by reference to the income or profits of such Person or such Person
and its Restricted Subsidiaries (to the extent such income or profits were
included in computing Consolidated Net Income for such period), regardless of
whether such taxes or payments are required to be remitted to any governmental
authority.


 


“Consolidated
Interest Expense” means, for any period, the total interest
expense of the Company and its consolidated Restricted Subsidiaries, whether
paid or accrued, plus, to the extent not included in such interest expense and
without duplication:


 


(1)           interest expense
attributable to Capitalized Lease Obligations and the interest portion of rent
expense associated with Attributable Indebtedness in respect of the relevant
lease giving rise thereto, determined as if such lease were a capitalized lease
in accordance with GAAP and the interest component of any deferred payment
obligations;


 


(2)           amortization of debt
discount; provided, however, that any amortization
of bond premium shall be credited to reduce Consolidated Interest Expense
unless, pursuant to GAAP, such amortization of bond premium has otherwise
reduced Consolidated Interest Expense;


 


(3)           non-cash interest expense;


 


(4)           commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers’
acceptance financing;


 


(5)           the interest expense on
Indebtedness of another Person that is Guaranteed by such Person or one of its
Restricted Subsidiaries or secured by a Lien on assets of such Person or one of
its Restricted Subsidiaries;


 


(6)           costs associated with
Hedging Obligations (including amortization of fees) provided,
however, that if Hedging Obligations result in net benefits rather
than costs, such benefits shall be credited to reduce Consolidated Interest
Expense unless, pursuant to GAAP, such net benefits are otherwise reflected in
Consolidated Net Income;


 


(7)           the consolidated interest
expense of such Person and its Restricted Subsidiaries that was capitalized
during such period;


 


(8)           the product of (a) all
dividends paid or payable, in cash, Cash Equivalents or Indebtedness or accrued
during such period on any series of Disqualified Stock of


 


15

















 


such
Person or on Preferred Stock of its Restricted Subsidiaries that are not
Subsidiary Guarantors payable to a party other than the Company or a Wholly
Owned Subsidiary, times (b) a fraction, the numerator of which is one and
the denominator of which is one minus the then current combined Federal, state,
provincial and local statutory tax rate of such Person, expressed as a decimal,
in each case, on a consolidated basis and in accordance with GAAP;


 


(9)           Receivables Fees; and


 


(10)         the cash contributions to
any employee stock ownership plan or similar trust to the extent such
contributions are used by such plan or trust to pay interest or fees to any
Person (other than the Company and its Restricted Subsidiaries) in connection
with Indebtedness Incurred by such plan or trust.


 


minus, to the extent
included above, the sum of amortization of debt issuance costs and interest
income.


 


For the purpose of
calculating the Consolidated Coverage Ratio, the calculation of Consolidated
Interest Expense shall include all interest expense (including any amounts
described in clauses (1) through (10) above)
relating to any Indebtedness of the Company or any Restricted Subsidiary
described in the penultimate paragraph of the definition of “Indebtedness”.


 


For purposes of the
foregoing, total interest expense shall be determined (i) after giving
effect to any net payments made or received by the Company and its Subsidiaries
with respect to Interest Rate Agreements and (ii) exclusive of amounts
classified as other comprehensive income in the balance sheet of the Company.
Notwithstanding anything to the contrary contained herein, commissions,
discounts, yield and other fees and charges Incurred in connection with any
transaction pursuant to which the Company or its Restricted Subsidiaries may
sell, convey or otherwise transfer or grant a security interest in any accounts
receivable or related assets shall be included in Consolidated Interest Expense.


 


“Consolidated
Net Income” means, for any period, the net income (loss) of the
Company and its consolidated Restricted Subsidiaries determined in accordance
with GAAP; provided, however, that there shall not
be included in such Consolidated Net Income:


 


(1)           any net income (or loss) of
any Person if such Person is not a Restricted Subsidiary, except that:


 


(a)           subject to the limitations
contained in clauses (3), (4) and (5) below,
the Company’s equity in the net income of any such Person for such period shall
be included in such Consolidated Net Income up to the aggregate amount of cash
actually distributed by such Person during such period to the Company or a
Restricted Subsidiary as a dividend, distribution or other payment (subject, in
the case of a dividend, distribution or other payment to a Restricted
Subsidiary, to the limitations contained in clause (2) below);
and


 


16

















 


(b)           the Company’s equity in a
net loss of any such Person (other than an Unrestricted Subsidiary) for such
period shall be included in determining such Consolidated Net Income to the
extent such loss has been funded with cash from the Company or a Restricted
Subsidiary;


 


(2)           any net income (but not
loss) of any Restricted Subsidiary if such Subsidiary is subject to
restrictions, directly or indirectly, on the payment of dividends or the making
of distributions by such Restricted Subsidiary, directly or indirectly, to the
Company, except that:


 


(a)           subject to the limitations
contained in clauses (3), (4) and (5) below,
the Company’s equity in the net income of any such Restricted Subsidiary for
such period shall be included in such Consolidated Net Income up to the
aggregate amount of cash that could have been distributed by such Restricted
Subsidiary during such period to the Company or another Restricted Subsidiary
as a dividend, distribution or other payment (subject, in the case of a
dividend to another Restricted Subsidiary, to the limitation contained in this
clause); and


 


(b)           the Company’s equity in a
net loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income;


 


(3)           any after-tax gain (loss)
realized upon the sale or other disposition of any property, plant or equipment
of the Company or its consolidated Restricted Subsidiaries (including pursuant
to any Sale/Leaseback Transaction) which is not sold or otherwise disposed of
in the ordinary course of business and any gain (loss) realized upon the sale
or other disposition of any Capital Stock of any Person;


 


(4)           any after-tax extraordinary
gain or loss;


 


(5)           the cumulative effect of a
change in accounting principles;


 


(6)           any asset impairment or
writedown on or related to Oil and Gas Properties under GAAP or Commission
guidelines;


 


(7)           any unrealized non-cash
gains or losses or charges in respect of Hedging Obligations (including those
resulting from the application of Statement of Financial Accounting Standards No. 133
or similar provisions);


 


(8)           any after-tax gain or loss
realized on the termination of any employee pension benefit plan;


 


(9)           non-cash charges relating to
grants of performance shares, stock options, stock awards, stock purchase
agreements or management compensation plans for officers, directors, employees
or consultants of the Company or a Restricted Subsidiary (excluding any such
non-cash charge to the extent that it represents an


 


17
















 


accrual
of or reserve for cash charges in any future period or amortization of a
prepaid cash expense that was paid in a prior period) to the extent that such
non-cash charges are deducted in computing such Consolidated Net Income; provided that if the Company or any Restricted Subsidiary of
the Company makes a cash payment in respect of a non-cash charge in any period,
such cash payment shall (without duplication) be deducted from the Consolidated
Net Income of the Company for such period;


 


(10)         any adjustments of a
deferred tax liability or asset pursuant to Statement of Financial Accounting
Standards No. 109 which result from changes in enacted tax laws or rates;
and


 


(11)         costs incurred in connection
with acquisitions that were eligible for capitalization treatment under GAAP
but instead were expensed at the time of incurrence, provided
that any such costs shall instead reduce Consolidated Net Income for any period
to the extent of any amortization in such period that would have occurred had
they had been capitalized).


 


“Continuing
Directors” means, as of any date of determination, any member of
the Board of Directors of the Company who: (1) was a member of such Board
of Directors on the Issue Date; or (2) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.


 


“covenant
defeasance” shall have the meaning set forth in Section 8.02(a) of
this First Supplemental Indenture.


 


“Credit
Facilities” means, with respect to the Company or any Subsidiary
Guarantor, one or more debt facilities (including, without limitation, the
Senior Credit Facility, and the uncommitted money market line of credit
facility, dated November 3, 2005 between the Company and Societe Generale,
as amended, or commercial paper facilities with banks or other institutional
lenders providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special
purpose entities formed to borrow from such lenders against such receivables)
or letters of credit, in each case, as amended, restated, modified, renewed,
refunded, replaced or refinanced in whole or in part from time to time (and whether
or not with the original administrative agent and lenders or another
administrative agent or agents or other lenders and whether provided under the
original Senior Credit Facility or any other credit or other agreement or
indenture).


 


“Custodian”
means any receiver, trustee, assignee, liquidator, custodian or similar
official under any Bankruptcy Law.


 


“Currency
Agreement” means in respect of a Person any foreign exchange
contract, currency swap agreement, futures contract, option contract or other
similar agreement as to which such Person is a party or a beneficiary.


 


“Default”
means any event which is, or after notice or passage of time or both would be,
an Event of Default.


 


18

















 


“Definitive
Security” means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 1.03 of
this First Supplemental Indenture, in the form of Exhibit A hereto
except that such Note shall not bear the Global Security legend set forth
therein.


 


“Disqualified
Stock” means, with respect to any Person, any Capital Stock of
such Person which by its terms (or by the terms of any security into which it
is convertible or for which it is exchangeable) or upon the happening of any
event:


 


(1)           matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise;


 


(2)           is convertible or
exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock
which is convertible or exchangeable solely at the option of the Company or a
Restricted Subsidiary); or


 


(3)           is redeemable at the option
of the holder of the Capital Stock in whole or in part,


 


in each case on or prior to
the date that is 91 days after the earlier of the date (a) of the Stated
Maturity of the Notes or (b) on which there are no Notes outstanding, provided that only the portion of Capital Stock which so
matures or is mandatorily redeemable, is so convertible or exchangeable or is
so redeemable at the option of the Holder thereof prior to such date shall be
deemed to be Disqualified Stock; provided, further
that any Capital Stock that would constitute Disqualified Stock solely because
the Holders thereof have the right to require the Company to repurchase such
Capital Stock upon the occurrence of a change of control or asset sale (each
defined in a substantially identical manner to the corresponding definitions in
the Indenture) shall not constitute Disqualified Stock if the terms of such
Capital Stock (and all such securities into which it is convertible or for
which it is ratable or exchangeable) provide that the Company may not
repurchase or redeem any such Capital Stock (and all such securities into which
it is convertible or for which it is ratable or exchangeable) pursuant to such
provision prior to compliance by the Company with the provisions of Sections 6.14
and 6.11 of this First Supplemental Indenture and such repurchase or
redemption complies with Section 6.08 of this First Supplemental
Indenture.


 


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


 


“Domestic
Subsidiary” means any Restricted Subsidiary that is organized
under the laws of the United States of America or any state thereof or the
District of Columbia.


 


“DTC”
means The Depository Trust Company, its nominees and their respective
successors and assigns, or such other depository institution hereinafter
appointed by the Company.


 


“Event
of Default” shall have the meaning set forth in Section 3.02
of this First Supplemental Indenture.


 


19

















 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.


 


“Foreign
Required Minority Shares” means directors’ qualifying shares and
other shares of Capital Stock of a Foreign Subsidiary that are required by the
applicable laws and regulations of such foreign jurisdiction to be owned by the
government of such foreign jurisdiction or individual or corporate citizens of
such foreign jurisdiction in order for such Foreign Subsidiary to transact
business in such foreign jurisdiction.


 


“Foreign
Subsidiary” means any Restricted Subsidiary that is not
organized under the laws of the United States of America or any state thereof
or the District of Columbia and any Subsidiary of such Restricted Subsidiary.


 


“GAAP”
means generally accepted accounting principles in the United States of America
as in effect as of the Issue Date, including those set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other statements by such other
entity as approved by a significant segment of the accounting profession. All
ratios and computations based on GAAP contained in the Indenture shall be
computed in conformity with GAAP, except that in the event the Company is
acquired in a transaction that is accounted for using purchase accounting, the
effects of the application of purchase accounting shall be disregarded in the
calculation of such ratios and other computations contained in the Indenture.


 


“Guarantee”
means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person and any
obligation, direct or indirect, contingent or otherwise, of such Person:


 


(1)           to purchase or pay (or advance
or supply funds for the purchase or payment of) such Indebtedness of such other
Person (whether arising by virtue of partnership arrangements, or by agreement
to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise); or


 


(2)           entered into for purposes of
assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided, however, that the term “Guarantee” shall not include endorsements for collection or
deposit in the ordinary course of business. The term “Guarantee”
used as a verb has a corresponding meaning.


 


“Guarantor
Subordinated Obligation” means, with respect to a Subsidiary
Guarantor, any Indebtedness of such Subsidiary Guarantor (whether outstanding
on the Issue Date or thereafter Incurred) which is subordinated in right of
payment to the obligations of such Subsidiary Guarantor under its Subsidiary
Guarantee pursuant to a written agreement.


 


“Hedging
Obligations” of any Person means the obligations of such Person
pursuant to any Interest Rate Agreement, Currency Agreement or Commodity
Agreement.


 


20

















 


“Hydrocarbons”
means oil, natural gas, casinghead gas, drip gasoline, natural gasoline,
condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and all
constituents, elements or compounds thereof and products refined or processed
therefrom.


 


“Incur”
means issue, create, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of
a Person existing at the time such Person becomes a Restricted Subsidiary
(whether by merger, consolidation, acquisition or otherwise) shall be deemed to
be Incurred by such Restricted Subsidiary at the time it becomes a Restricted
Subsidiary; and the terms “Incurred” and “Incurrence” have meanings correlative to the foregoing.


 


“Indebtedness”
means, with respect to any Person on any date of determination (without
duplication):


 


(1)           the principal of and premium
(if any) in respect of indebtedness of such Person for borrowed money;


 


(2)           the principal of and premium
(if any) in respect of obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;


 


(3)           the principal component of
all obligations of such Person in respect of letters of credit, bankers’
acceptances or other similar instruments (including reimbursement obligations
with respect thereto except to the extent such reimbursement obligation relates
to a trade payable and such obligation is satisfied within 30 days of
Incurrence);


 


(4)           the principal component of
all obligations of such Person to pay the deferred and unpaid purchase price of
property (except trade payables), which purchase price is due more than six
months after the date of placing such property in service or taking delivery
and title thereto;


 


(5)           Capitalized Lease
Obligations and all Attributable Indebtedness of such Person;


 


(6)           the principal component or
liquidation preference of all obligations of such Person with respect to the
redemption, repayment or other repurchase of any Disqualified Stock or, with
respect to any Subsidiary that is not a Subsidiary Guarantor, any Preferred
Stock;


 


(7)           the principal component of
all Indebtedness of other Persons secured by a Lien on any asset of such
Person, whether or not such Indebtedness is assumed by such Person; provided, however, that the amount of such Indebtedness
shall be the lesser of (a) the liquidation value of such asset at such
date of determination and (b) the amount of such Indebtedness of such
other Persons;


 


(8)           the principal component of
Indebtedness of other Persons to the extent Guaranteed by such Person;


 


21

















 


(9)           to the extent not otherwise
included in this definition, net obligations of such Person under Hedging
Obligations (the amount of any such obligations to be equal at any time to the
termination value of such agreement or arrangement giving rise to such
obligation that would be payable by such Person at such time); and


 


(10)         to the extent not otherwise
included in this definition, the amount of obligations outstanding under the
legal documents entered into as part of a securitization transaction or series
of securitization transactions that would be characterized as principal if such
transaction were structured as a secured lending transaction rather than as a
purchase outstanding relating to a securitization transaction or series of
securitization transactions.


 


Notwithstanding the
preceding, Indebtedness shall not include Volumetric Production Payments. The
amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and
the maximum liability, upon the occurrence of the contingency giving rise to
the obligation, of any contingent obligations at such date. Notwithstanding the
foregoing, money borrowed and set aside at the time of the Incurrence of any
Indebtedness in order to pre-fund the payment of interest on such Indebtedness
shall not be deemed to be “Indebtedness,” provided that such money is held to secure the payment of
such interest.


 


In addition, “Indebtedness” of any Person shall include Indebtedness
described in the preceding paragraph that would not appear as a liability on
the balance sheet of such Person if:


 


(1)           such Indebtedness is the
obligation of a partnership, limited liability company or similar entity that is
not a Restricted Subsidiary (a “Joint Venture”);


 


(2)           such Person or a Restricted
Subsidiary of such Person is a general partner of the Joint Venture (a “General Partner”); and


 


(3)           there is recourse, by
contract or operation of law, with respect to the payment of such Indebtedness
to property or assets of such Person or a Restricted Subsidiary of such Person;
and then such Indebtedness shall be included in an amount not to exceed:


 


(a)           the lesser of (i) the
net assets of the General Partner and (ii) the amount of such obligations
to the extent that there is recourse, by contract or operation of law, to the
property or assets of such Person or a Restricted Subsidiary of such Person; or


 


(b)           if less than the amount
determined pursuant to clause (a) immediately above, the
actual amount of such Indebtedness that is recourse to such Person or a
Restricted Subsidiary of such Person, if the Indebtedness is evidenced by a
writing and is for a determinable amount.


 


22

















 


No Indebtedness will be
deemed to be subordinate in right of payment to any other Indebtedness solely
by virtue of being unsecured, being secured by junior liens or having a later
maturity date.


 


“Interest
Rate Agreement” means, with respect to any Person any interest
rate protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement or other similar agreement
or arrangement as to which such Person is party or a beneficiary.


 


“Investment”
means, with respect to any Person, all investments by such Person in other
Persons (including Affiliates) in the form of any direct or indirect advance,
loan or other extension of credit (including by way of Guarantee or similar
arrangement) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the
account or use of others), or any purchase or acquisition of Capital Stock,
Indebtedness or other similar instruments issued by, such Person and all other
items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP.


 


For purposes of Section 6.08
of this First Supplemental Indenture:


 


(1)           “Investment”
shall include the portion (proportionate to the Company’s equity interest in a
Restricted Subsidiary to be designated as an Unrestricted Subsidiary) of the
fair market value of the net assets of such Restricted Subsidiary at the time
that such Restricted Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such
Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue
to have a permanent “Investment” in an
Unrestricted Subsidiary in an amount (if positive) equal to (a) the
Company’s “Investment” in such Subsidiary at the
time of such redesignation less (b) the portion (proportionate to the
Company’s equity interest in such Subsidiary) of the fair market value of the
net assets (as conclusively determined by the Board of Directors of the Company
in good faith) of such Subsidiary at the time that such Subsidiary is so
re-designated a Restricted Subsidiary; and


 


(2)           any property transferred to
or from an Unrestricted Subsidiary shall be valued at its fair market value at
the time of such transfer, in each case as determined in good faith by the
Board of Directors of the Company.


 


“Investment
Grade Rating” means a rating equal to or higher than Baa3 (or
the equivalent) by Moody’s Investors Service, Inc. and BBB- (or the
equivalent) by Standard & Poor’s Ratings Group, Inc., in each
case, with a stable or better outlook.


 


“Issue
Date” means May 27, 2009.


 


“Lien”
means any mortgage, pledge, security interest, encumbrance, lien or charge of
any kind (including any conditional sale or other title retention agreement or
lease in the nature thereof).


 


23

















 


“Minority
Interest” means the percentage interest represented by any
shares of stock of any class of Capital Stock of a Restricted Subsidiary that
are not owned by the Company or a Restricted Subsidiary.


 


“Net
Available Cash” from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise and net
proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other consideration
received in the form of assumption by the acquiring Person of Indebtedness or
other obligations relating to the properties or assets that are the subject of
such Asset Disposition or received in any other non-cash form) therefrom, in
each case net of:


 


(1)           all legal, accounting,
engineering, investment banking, brokerage, title and recording tax expenses,
commissions and other fees and expenses Incurred, and all Federal, state,
provincial, foreign and local taxes required to be paid or accrued as a liability
under GAAP (after taking into account any available tax credits or deductions
and any tax sharing agreements), as a consequence of such Asset Disposition,
and any relocation expenses incurred or assumed in connection with such Asset
Disposition;


 


(2)           all payments made on any
Indebtedness which is secured by any assets subject to such Asset Disposition,
in accordance with the terms of any Lien upon such assets, or which must by its
terms, or in order to obtain a necessary consent to such Asset Disposition, or,
by applicable law, be repaid out of the proceeds from such Asset Disposition;


 


(3)           all distributions and other
payments required to be made to minority interest Holders in Subsidiaries or
Joint Ventures or to holders of royalty or similar interests as a result of
such Asset Disposition; and


 


(4)           the deduction of appropriate
amounts to be provided by the seller as reserves, in accordance with GAAP, (A) for
adjustment in respect of the sale price of the assets that were the subject of
such Asset Disposition and (B) against any liabilities associated with the
assets disposed of in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition.


 


“Net
Cash Proceeds,” with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys’ fees,
accountants’ fees, underwriters’ or placement agents’ fees, listing fees,
discounts or commissions and brokerage, consultant and other fees and charges
actually Incurred in connection with such issuance or sale and net of taxes
paid or payable as a result of such issuance or sale (after taking into account
any available tax credit or deductions and any tax sharing arrangements).


 


“Net
Working Capital” means (a) all current assets of the
Company and its Restricted Subsidiaries except current assets constituting
non-cash gains on Hedging Obligations resulting from the requirements of
Statement of Financial Accounting Standards No. 133 and similar 


 


24

















 


provisions,
less (b) all current liabilities of the Company and its Restricted
Subsidiaries, except current liabilities included in Indebtedness and any
current liabilities constituting any non-cash losses or charges on Hedging Obligations
resulting from the requirements of Statement of Financial Accounting Standards No. 133
and similar provisions, in each case as set forth in the consolidated financial
statements of the Company prepared in accordance with GAAP.


 


“Non-Guarantor
Restricted Subsidiary” means any Restricted Subsidiary that is
not a Subsidiary Guarantor.


 


“Non-Recourse
Debt” means Indebtedness of a Person:


 


(1)           as to which neither the
Company nor any Restricted Subsidiary (a) provides any Guarantee or credit
support of any kind (including any undertaking, guarantee, indemnity, agreement
or instrument that would constitute Indebtedness) or (b) is directly or
indirectly liable (as a guarantor or otherwise); and


 


(2)           no default with respect to
which (including any rights that the Holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any Holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its Stated Maturity.


 


“Officer”
means the Chairman of the Board, the Chief Executive Officer, the President,
the Chief Financial Officer, any Vice President, the Treasurer or the Secretary
of the Company. Officer of any Subsidiary Guarantor has a correlative meaning.


 


“Officers’
Certificate” means a certificate signed by two Officers or by an
Officer and either an Assistant Treasurer or an Assistant Secretary of the
Company.


 


“Oil
and Gas Business” means (a) the business of acquiring,
exploring, exploiting, developing, producing, operating and disposing of
interests in Hydrocarbons and Oil and Gas Properties, (b) the business of
gathering, marketing, distributing, treating, processing, storing, refining,
selling and transporting of Hydrocarbons and Oil and Gas Properties and
products produced in association therewith, (c) other energy-related
business, including the ownership and operation of co-generation facilities and
steam and electrical transmission businesses, (d) any business relating to
oil field sales and services including ownership and operation of drilling
rigs, and (e) any business or activity relating to, arising from, or
necessary, appropriate or incidental to, the activities described in the
foregoing clauses of this definition.


 


“Oil
and Gas Properties” means all properties, including equity or
other ownership interests therein, owned by such Person which contain or are
believed to contain oil and gas reserves.


 


“Opinion
of Counsel” means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.


 


25

















 


“Pari
Passu Indebtedness” means Indebtedness that ranks equally in
right of payment to the Notes.


 


“Permitted
Business Investment” means any Investment made in the ordinary
course of, and of a nature that is or shall have become customary in, the Oil
and Gas Business or any other Related Business including investments or
expenditures for actively exploiting, exploring for, acquiring, developing,
producing, operating, disposing of interests in, processing, gathering,
marketing, distributing, treating, storing, refining, selling or transporting
Hydrocarbons, Related Assets and Oil and Gas Properties through agreements,
transactions, interests or arrangements which permit one to share risks or
costs, comply with regulatory requirements regarding local ownership or satisfy
other objectives customarily achieved through the conduct of such businesses
jointly with third parties, including:


 


(1)           ownership interests in Oil
and Gas Properties, co-generation facilities, refineries, liquid natural gas
facilities, processing facilities, gathering systems, pipelines or ancillary
real property interests, either directly or through entities the primary
business of which is to own or operate any of the foregoing; and


 


(2)           entry into and Investments
in the form of or pursuant to, operating agreements, working interests, royalty
interests, mineral leases, processing agreements, farm-in agreements, farm-out
agreements, contracts for the sale, transportation or exchange of oil and
natural gas, production sharing agreements, development agreements, area of mutual
interest agreements, unitization agreements, pooling arrangements, joint
bidding agreements, service contracts, joint venture agreements, partnership
agreements (whether general or limited), limited liability company agreements,
subscription agreements, stock purchase agreements, stockholder agreements and
other similar agreements with third parties (including Unrestricted
Subsidiaries);


 


provided, however that a “Permitted Business Investment” shall
only include Investments in entities that are classified as pass-through
entities for U.S. Federal, state and local and foreign income tax purposes.


 


“Permitted
Holders” means William F. Berry and Winberta Holdings, Ltd. Any
person or group whose acquisition of beneficial ownership constitutes a Change
of Control in respect of which a Change of Control Offer is made in accordance
with the requirements of the Indenture (or would result in a Change of Control
Offer in the absence of the waiver of such requirement by Holders in accordance
with the Indenture) shall thereafter constitute additional Permitted Holders.


 


“Permitted
Investment” means an Investment by the Company or any Restricted
Subsidiary in:


 


(1)           the Company, a Restricted
Subsidiary or a Person which shall, upon the making of such Investment, become
a Restricted Subsidiary; provided, however,
that the primary business of such Restricted Subsidiary is a Related Business;


 


26

















 


(2)           another Person if as a
result of such Investment such other Person is merged or consolidated with or
into, or transfers or conveys all or substantially all its assets to, the
Company or a Restricted Subsidiary; provided, however,
that such Person’s primary business is a Related Business;


 


(3)           cash and Cash Equivalents;


 


(4)           receivables owing to the
Company or any Restricted Subsidiary created or acquired in the ordinary course
of business and payable or dischargeable in accordance with customary trade
terms; provided, however, that such trade terms
may include such concessionary trade terms as the Company or any such
Restricted Subsidiary deems reasonable under the circumstances;


 


(5)           payroll, travel and similar
advances to cover matters that are expected at the time of such advances
ultimately to be treated as expenses for accounting purposes and that are made
in the ordinary course of business;


 


(6)           loans or advances to, and
Guarantees of obligations of, employees, officers or directors of the Company
or any Restricted Subsidiary in the ordinary course of business in an aggregate
amount not in excess of $2.0 million with respect to all loans or advances made
since the Start Date (without giving effect to the forgiveness of any such
loan); provided, however, that the Company and
its Subsidiaries shall comply in all material respects with the provisions of
the Sarbanes Oxley Act of 2002 and the rules and regulations promulgated
in connection therewith relating to the provision of any such loans and
advances as if the Company had filed a registration statement with the
Commission;


 


(7)           Capital Stock, obligations
or securities received in settlement of debts created in the ordinary course of
business and owing to the Company or any Restricted Subsidiary or in
satisfaction of judgments or pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of a debtor;


 


(8)           Investments made as a result
of the receipt of non-cash consideration from an Asset Disposition or other
disposition that was made pursuant to and in compliance with Section 6.11
of this First Supplemental Indenture;


 


(9)           Investments in existence on
the Start Date;


 


(10)         Currency Agreements,
Interest Rate Agreements, Commodity Agreements and related Hedging Obligations,
which transactions or obligations are Incurred in compliance with Section 6.06
of this First Supplemental Indenture;


 


(11)         Investments by the Company
or any of its Restricted Subsidiaries, together with all other Investments
pursuant to this clause (11), in an aggregate amount at the time of
such Investment not to exceed $10.0 million outstanding at any one time (with
the fair market value of such Investment being measured at the time made and
without giving effect to subsequent changes in value);


 


27
















 


(12)         Guarantees issued in
accordance with Section 6.06 of this First Supplemental Indenture;


 


(13)         any Asset Swap made in
accordance with Section 6.11 of this First Supplemental Indenture;


 


(14)         Permitted Business
Investments;


 


(15)         Investments constituting
prepaid expenses or advances or extensions of credit to customers or suppliers
in the ordinary course of business;


 


(16)         endorsements of negotiable
instruments and documents in the ordinary course of business;


 


(17)         acquisitions of assets,
Capital Stock or other securities by the Company or a Subsidiary for
consideration to the extent such consideration consists of Common Stock of the
Company; provided, however, that the Qualified
Proceeds from such sale of Capital Stock (to the extent so used) shall be excluded
from clause (C)(ii) of Section 6.08(a) of
this First Supplemental Indenture;


 


(18)         Investments in the form of
Capitalized Lease Obligations or mortgage or purchase money financing in an
aggregate principal amount not to exceed $25.0 million at any time outstanding;


 


(19)         Investments in the form of
bank deposits (other than time deposits); and


 


(20)         Investments in the form of
other deposits made in the ordinary course of business and constituting
Permitted Liens.


 


“Permitted
Liens” means, with respect to any Person:


 


(1)           Liens securing Indebtedness
under Credit Facilities (and related Hedging Obligations and related
Guarantees) permitted to be Incurred under Section 6.06 of this First
Supplemental Indenture;


 


(2)           pledges or deposits by such
Person under workers’ compensation laws, unemployment insurance laws or similar
legislation, or good faith deposits in connection with bids, tenders or
contracts (including leases but excluding contracts for the payment of
Indebtedness) 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 surety or appeal bonds to which such Person is a
party, or deposits as security for contested taxes or import or customs duties
or for the payment of rent, in each case Incurred in the ordinary course of
business;


 


(3)           Liens imposed by law,
including carriers’, warehousemen’s, mechanics’, materialmen’s and repairmen’s
Liens, or related contracts in the ordinary course of business, in each case
for sums not yet due or being contested in good faith by 


 


28

















 


appropriate
proceedings if a reserve or other appropriate provisions, if any, as shall be
required by GAAP shall have been made in respect thereof;


 


(4)           Liens for taxes, assessments
or other governmental charges not yet subject to penalties for non-payment or
which are being contested in good faith by appropriate proceedings provided appropriate reserves required pursuant to GAAP have
been made in respect thereof;


 


(5)           Liens in favor of issuers of
surety or performance bonds or letters of credit or bankers’ acceptances issued
pursuant to the request of and for the account of such Person in the ordinary
course of its business; provided, however,
that such letters of credit do not constitute Indebtedness;


 


(6)           encumbrances, ground leases,
easements or reservations of, or rights of others for, licenses, rights of way,
sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning, building codes or other restrictions (including, without
limitation, minor defects or irregularities in title and similar encumbrances)
as to the use of real properties or liens incidental to the conduct of the
business of such Person or to the ownership of its properties 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;


 


(7)           Liens securing Hedging
Obligations permitted under clause (6) of Section 6.06(b) of
this First Supplemental Indenture;


 


(8)           leases, licenses, subleases
and sublicenses of assets (including, without limitation, real property and
intellectual property rights) which do not materially interfere with the
ordinary conduct of the business of the Company or any of its Restricted
Subsidiaries;


 


(9)           judgment Liens not giving
rise to an Event of Default so long as such Lien is adequately bonded and any
appropriate legal proceedings which may have been duly initiated for the review
of such judgment have not been finally terminated or the period within which
such proceedings may be initiated has not expired;


 


(10)         Liens for the purpose of
securing Indebtedness represented by Capitalized Lease Obligations, mortgage
financings, purchase money obligations or other payments Incurred to finance
all or any part of the purchase price or cost of construction or improvement of
assets or property (other than Capital Stock or other Investments) acquired,
constructed or improved by such Person; provided that:


 


(a)           the aggregate principal
amount of Indebtedness secured by such Liens is otherwise permitted to be
Incurred under the Indenture and does not exceed the cost of the assets or
property so acquired, constructed or improved; and


 


(b)           such Liens are created
within 180 days of construction, acquisition or improvement of such assets or
property and do not encumber any other 


 


29

















 


assets or property of such
Person other than such assets or property and assets affixed or appurtenant
thereto and proceeds thereof;


 


(11)         Liens arising
solely by virtue of any statutory or common law provisions relating to banker’s
Liens, rights of set-off or similar rights or related contracts in the ordinary
course of business and remedies as to deposit accounts or other funds
maintained with a depositary institution; provided that:


 


(a)           such deposit account is not
a dedicated cash collateral account and is not subject to restrictions against
access by such Person in excess of those set forth by regulations promulgated
by the Federal Reserve Board; and


 


(b)           such deposit account is not
intended by such Person to provide collateral to the depository institution;


 


(12)         Liens arising
from Uniform Commercial Code financing statement filings regarding operating
leases entered into by such Person in the ordinary course of business;


 


(13)         Liens existing
on the Issue Date (other than Liens permitted under clause (1));


 


(14)         Liens on
property or Capital Stock of a Person at the time such Person becomes a
Restricted Subsidiary, or is merged with or into or consolidated with or
acquired by, the Company or a Restricted Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in connection
with, or in contemplation of, such event; provided further, however,
that any such Lien may not extend to any other property owned by the Company or
any Restricted Subsidiary other than improvements, additions and accessions to
such property, dividends and distributions in respect of such property and
proceeds of any of the foregoing;


 


(15)         Liens on
property at the time the Company or a Restricted Subsidiary acquired the
property, including any acquisition by means of a merger or consolidation with or
into the Company or any Restricted Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in
connection with, or in contemplation of, such acquisition; provided
further, however, that such Liens may not extend to any other property
owned by the Company or any Restricted Subsidiary other than improvements,
additions and accessions to such property, dividends and distributions in
respect of such property and proceeds of any of the foregoing;


 


(16)         Liens in favor
of the Company or a Restricted Subsidiary;


 


(17)         Liens securing
the Notes and Subsidiary Guarantees;


 


(18)         Liens securing
Refinancing Indebtedness Incurred to refinance, refund, replace, amend, extend
or modify, as a whole or in part, Indebtedness that was previously so secured
pursuant to clauses (9), (10), (13), (14), (15),
(17) and (18) of this definition, provided
that any such Lien is limited to all or part of the same 


 


30

















 


property
or assets (plus improvements, additions, accessions, proceeds, dividends and
distributions in respect thereof) that secured (or, under the written
arrangements under which the original Lien arose, could secure) the
Indebtedness being refinanced or is in respect of property that is the security
for a Permitted Lien hereunder;


 


(19)         any interest or
title of a lessor under any operating lease;


 


(20)         Liens under
industrial revenue, municipal or similar bonds;


 


(21)         Liens in
respect of Production Payments and Reserve Sales, which Liens shall be limited
to the property that is the subject of such Production Payments and Reserve
Sales and proceeds thereof;


 


(22)         Liens arising
under farm-out agreements, farm-in agreements, division orders, mineral leases,
partnership agreements, joint venture agreements, contracts for the sale,
purchase, exchange, transportation, gathering or processing of Hydrocarbons and
Related Assets, unitizations and pooling designations, declarations, orders and
agreements, development agreements, operating agreements, production sales
contracts, area of mutual interest agreements, gas balancing or deferred
production agreements, injection, repressuring and recycling agreements, salt
water or other disposal agreements, seismic or geophysical permits or
agreements, and other agreements which are customary in any Related Business; provided, however, in all instances that such Liens are
limited to the assets that are the subject of the relevant agreement, program,
order or contract and improvements, additions and accessions thereto, and
proceeds of any of the foregoing;


 


(23)         Liens on
pipelines or pipeline facilities that arise by operation of law;


 


(24)         Liens
encumbering assets under construction (and improvements, additions and
accessions thereto and proceeds of any of the foregoing) arising from progress
or partial payments by a customer of the Company or its Restricted Subsidiaries
relating to such assets;


 


(25)         Liens arising
under the Indenture in favor of the Trustee for its own benefit and similar
Liens in favor of other trustees, agents and representatives arising under
instruments governing Indebtedness permitted to be incurred under the
Indenture, provided, that such Liens are solely for
the benefit of the trustees, agents, or representatives in their capacities as
such and not for the benefit of the Holders of such Indebtedness;


 


(26)         Liens arising
from the deposit of funds or securities in trust for the purpose of decreasing
or defeasing Indebtedness so long as such deposit of funds or securities and
such decreasing or defeasing of Indebtedness are permitted under Section 6.08
of this First Supplemental Indenture; and


 


31

















 


(27)         Liens securing
Indebtedness (other than Subordinated Obligations and Guarantor Subordinated
Obligations) and other unsubordinated obligations in an aggregate amount
outstanding at any one time not to exceed $15.0 million.


 


“Person”
means any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization, limited liability
company, government or any agency or political subdivision hereof or any other
entity.


 


“Preferred
Stock,” as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is preferred
as to the payment of dividends, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such corporation, over
shares of Capital Stock of any other class of such corporation.


 


“Production
Payments and Reserve Sales” means the grant or transfer by the
Company or a Restricted Subsidiary to any Person of a royalty, overriding
royalty, net profits interest, production payment (including Volumetric
Production Payments and Dollar-Denominated Production Payments), 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 where the Holder of such interest has recourse
solely to such production or proceeds of production, subject to the obligation
of the grantor or transferor to operate and maintain, or cause the subject
interests to be operated and maintained, in a reasonably prudent manner or
other customary standard or subject to the obligation of the grantor or
transferor to indemnify for environmental, title or other matters customary in
the Oil and Gas Business, 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 or other providers of
technical services to the Company or a Restricted Subsidiary.


 


“Prospectus
Supplement” means the base prospectus, as amended dated February 26,
2009 contained in the Company’s Registration Statement on Form S-3, as
supplemented by the prospectus supplement dated May 21, 2009 with respect
to the Notes.


 


“Qualified
Proceeds” means any of the following or any combination thereof:
(1) Net Cash Proceeds, (2) Cash Equivalents, (3) assets that are
used or useful in a Related Business and (4) the Capital Stock of any
Person engaged in a Related Business that becomes a Restricted Subsidiary of
the Company or merges with or into the Company or a Restricted Subsidiary of
the Company.


 


“Rating
Agencies” means Standard & Poor’s Ratings Group, Inc.
and Moody’s Investors Service, Inc. or if Standard & Poor’s
Ratings Group, Inc. or Moody’s Investors Service, Inc. 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 Board of Directors) which shall be
substituted for Standard & Poor’s Ratings Group, Inc. or Moody’s
Investors Service, Inc. or both, as the case may be.


 


“Receivable”
means a right to receive payment arising from a sale or lease of goods or the
performance of services by a Person pursuant to an arrangement with another
Person 


 


32

















 


pursuant
to which such other Person is obligated to pay for goods or services under
terms that permit the purchase of such goods and services on credit and shall
include, in any event, any items of property that would be classified as an “account,” “chattel paper,”
“payment intangible” or “instrument” under the Uniform Commercial Code as in effect
in the State of New York and any “supporting obligations”
as so defined.


 


“Receivables
Fees” means any fees or interest paid to purchasers or lenders
providing the financing in connection with a securitization transaction,
factoring agreement or other similar agreement, including any such amounts paid
by discounting the face amount of Receivables or participations therein
transferred in connection with a securitization transaction, factoring
agreement or other similar arrangement, regardless of whether any such
transaction is structured as on-balance sheet or off-balance sheet or through a
Restricted Subsidiary or an Unrestricted Subsidiary.


 


“Refinancing
Indebtedness” means Indebtedness that is Incurred to refund,
refinance, replace, exchange, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) (collectively, “refinance”;
“refinances” and “refinanced”
shall each have a correlative meaning) any Indebtedness existing on the Issue
Date or Incurred in compliance with the Indenture (including Indebtedness of
the Company that refinances Indebtedness of any Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary that refinances Indebtedness of
another Restricted Subsidiary) including Indebtedness that refinances
Refinancing Indebtedness, provided, however,
that:


 


(1)           (a) if the Stated
Maturity of the Indebtedness being refinanced is earlier than the Stated
Maturity of the Notes, the Refinancing Indebtedness has a Stated Maturity no
earlier than the Stated Maturity of the Indebtedness being refinanced or (b) if
the Stated Maturity of the Indebtedness being refinanced is later than the
Stated Maturity of the Notes, the Refinancing Indebtedness has a Stated
Maturity at least 91 days later than the Stated Maturity of the Notes;


 


(2)           the Refinancing Indebtedness
has an Average Life at the time such Refinancing Indebtedness is Incurred that
is equal to or greater than the Average Life of the Indebtedness being
refinanced;


 


(3)           such Refinancing
Indebtedness is Incurred in an aggregate principal amount (or if issued with
original issue discount, an aggregate issue price) that is equal to or less
than the sum of the aggregate principal amount (or if issued with original
issue discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced (plus, without duplication, any additional
Indebtedness Incurred to pay interest or premiums required by the instruments
governing such existing Indebtedness and costs and fees Incurred in connection
therewith); and


 


(4)           if the Indebtedness being
refinanced is subordinated in right of payment to the Notes or the Subsidiary
Guarantees, such Refinancing Indebtedness is subordinated in right of payment
to the Notes or the Subsidiary Guarantees on terms at least as favorable to the
Holders as those contained in the documentation governing the Indebtedness
being refinanced.


 


33

















 


“Related
Assets” means steam, electricity, by-products of the utilization
of Hydrocarbons, products produced in association with Hydrocarbons, minerals,
and other assets commonly created, recovered or produced in the course of the
conduct of any Related Business.


 


“Related
Business” means (1) any business which is the same as or
related, ancillary or complementary to any of the businesses of the Company and
its Restricted Subsidiaries on the Issue Date, (2) the Oil and Gas
Business and (3) the business of acquiring, exploiting, developing,
producing, operating, gathering, marketing, treating, processing, storing,
refining, selling and transporting Related Assets.


 


“Restricted
Investment” means any Investment other than a Permitted
Investment.


 


“Restricted
Subsidiary” means any Subsidiary of the Company other than an
Unrestricted Subsidiary.


 


“Sale/Leaseback
Transaction” means an arrangement relating to property now owned
or hereafter acquired whereby the Company or a Restricted Subsidiary transfers
such property to a Person and the Company or a Restricted Subsidiary leases it
from such Person.


 


 “Securities Act”
means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.


 


“Securities
Custodian” means the custodian with respect to the Global
Security (as appointed by DTC), or any successor Person thereto and shall
initially be the Trustee.


 


“Senior
Credit Facility” means the Amended and Restated Credit Agreement
dated as of July 15, 2008 among the Company, Wells Fargo Bank, National
Association, as Administrative Agent, and the lenders parties thereto from time
to time, as the same may be amended, restated, modified, renewed, refunded,
replaced or refinanced in whole or in part from time to time, with the same or
different agents or lenders (including increasing the amount loaned or the
aggregate commitments of the lenders thereunder, provided
that such additional Indebtedness is Incurred in accordance with Section 6.06
of this First Supplemental Indenture); provided that a
Senior Credit Facility shall not (1) include Indebtedness issued, created
or Incurred pursuant to a registered offering of securities under the
Securities Act or a private placement of securities (including under Rule 144A
or Regulation S) pursuant to an exemption from the registration requirements of
the Securities Act or (2) relate to Subordinated Obligations.


 


“Significant
Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” of the Company within the meaning of
Rule 1-02 under Regulation S-X promulgated by the Commission.


 


“Start
Date” means October 24, 2006.


 


“Stated
Maturity” means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision, but shall not include any contingent obligations to
repay, redeem or repurchase any such principal prior to the date originally
scheduled for the payment thereof.


 


34

















 


“Subordinated
Obligation” means any Indebtedness of the Company (whether
outstanding on the Issue Date or thereafter Incurred) which is subordinated in
right of payment to the Notes pursuant to a written agreement.


 


“Subsidiary”
of any Person means (a) any corporation or other business entity (other
than a legal partnership, limited liability company or similar entity) of which
more than 50% of the total ordinary 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 (or persons performing
similar functions) or (b) any legal partnership, limited liability company
or similar entity of which more than 50% of the capital accounts, distribution
rights, total equity and voting interests or general or limited partnership
interests, as applicable, is, in the case of clauses (a) and (b),
at the time owned or controlled, directly or indirectly, by (1) such Person,
(2) such Person and one or more Subsidiaries of such Person or (3) one
or more Subsidiaries of such Person. Unless otherwise specified herein, each
reference to a Subsidiary shall refer to a Subsidiary of the Company.


 


“Subsidiary
Guarantee” means, individually, any Guarantee of payment of the
Notes by a Subsidiary Guarantor pursuant to the terms of the Indenture and any
supplemental indenture thereto, and, collectively, all such Guarantees. Each
such Subsidiary Guarantee shall be in the form prescribed by the Indenture,
including Article Nine of this First Supplemental Indenture.


 


“Subsidiary
Guarantor” means any Restricted Subsidiary that provides a
Subsidiary Guarantee after the Issue Date in accordance with the Indenture; provided that upon release or discharge of such Restricted
Subsidiary from its Subsidiary Guarantee in accordance with the Indenture, such
Restricted Subsidiary ceases to be a Subsidiary Guarantor.


 


“Treasury
Rate” means the yield to maturity at the time of computation of
United States Treasury securities with a constant maturity (as compiled and
published in the most recent Federal Reserve Statistical Release H.15 (519)
which has become publicly available at least two Business Days prior to the
redemption date (or, if such Statistical Release is no longer published, any
publicly available source of similar market data)) most nearly equal to the
period from the redemption date to the maturity date of the Notes; provided, however, that if the period from the redemption
date to such maturity date is not equal to the constant maturity of a United
States Treasury security for which a weekly average yield is given, the
Treasury Rate shall be obtained by linear interpolation (calculated to the
nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except that if the period
from the redemption date to such maturity date is less than one year, the
weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used.


 


“Unrestricted Subsidiary”
means:


 


(1)           any Subsidiary of the
Company that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors of the Company in the manner provided
below; and


 


(2)           any Subsidiary of an
Unrestricted Subsidiary.


 


35

















 


The Board of Directors of
the Company may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary or a Person becoming a Subsidiary through
merger or consolidation or Investment therein) to be an Unrestricted Subsidiary
only if:


 


(1)           such Subsidiary
and its Subsidiaries do not own any Capital Stock or Indebtedness of or have
any Investment in, or own or hold any Lien on any property of, any other
Subsidiary of the Company which is not a Subsidiary of the Subsidiary to be so
designated or otherwise an Unrestricted Subsidiary;


 


(2)           all the
Indebtedness of such Subsidiary and its Subsidiaries shall, at the date of
designation, and shall at all times thereafter, consist of Non-Recourse Debt;


 


(3)           such
designation and the Investment of the Company in such Subsidiary complies with Section 6.08
of this First Supplemental Indenture;


 


(4)           such Subsidiary,
either alone or in the aggregate with all other Unrestricted Subsidiaries, does
not operate, directly or indirectly, all or substantially all of the business
of the Company and its Subsidiaries;


 


(5)           such Subsidiary
is a Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation:


 


(a)           to subscribe for additional
Capital Stock of such Person; or


 


(b)           to maintain or preserve such
Person’s financial condition or to cause such Person to achieve any specified
levels of operating results; and


 


(6)           on the date
such Subsidiary is designated an Unrestricted Subsidiary, such Subsidiary is
not a party to any agreement, contract, arrangement or understanding with the
Company or any Restricted Subsidiary with terms substantially less favorable to
the Company than those that might have been obtained from Persons who are not
Affiliates of the Company.


 


Any such designation by the
Board of Directors of the Company shall be evidenced to the Trustee by filing
with the Trustee a resolution of the Board of Directors of the Company giving
effect to such designation and an Officers’ Certificate certifying that such
designation complies with the foregoing conditions. If, at any time, any
Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of the Indenture and any Indebtedness of such
Subsidiary shall be deemed to be Incurred as of such date.


 


The Board of Directors of
the Company may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that immediately after giving
effect to such designation, no Default or Event of Default shall have occurred
and be continuing or would occur as a consequence thereof and the Company could
Incur at least $1.00 of additional Indebtedness pursuant to Section 6.06(a) of
this First Supplemental Indenture on a pro forma basis taking into account such
designation.


 


36

















 


“U.S.
Government Obligations” means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a Person controlled
or supervised by and acting as an agency or instrumentality of the United
States of America the timely payment of which is unconditionally guaranteed as
a full faith and credit obligation of the United States of America, which, in
either case, are not callable or redeemable at the option of the issuer
thereof, and shall also include a depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act), as custodian with
respect to any such U.S. Government Obligations or a specific payment of principal
of or interest on any such U.S. Government Obligations held by such custodian
for the account of the Holder of such depositary receipt; provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the Holder of such depositary receipt from
any amount received by the custodian in respect of the U.S. Government
Obligations or the specific payment of principal of or interest on the U.S.
Government Obligations evidenced by such depositary receipt.


 


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


 


“Voting
Stock” of a Person means all classes of Capital Stock of such
Person then outstanding and normally entitled to vote in the election of
directors, managers or trustees, as applicable.


 


“Wholly
Owned Subsidiary” means a Restricted Subsidiary, all of the
Capital Stock of which (other than Foreign Required Minority Shares) is owned
by the Company or another Wholly Owned Subsidiary.


 


SECTION 2.03              Other
Definitions.


 


	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
  “Additional Notes”

  	
   

  	
  1.01

  	
   

  
	
  “Affiliate Transaction”

  	
   

  	
  6.12

  	
   

  
	
  “Agent Members”

  	
   

  	
  1.02

  	
   

  
	
  “Asset Disposition Offer”

  	
   

  	
  6.11(a)

  	
   

  
	
  “Asset Disposition Offer Amount”

  	
   

  	
  6.11(b)

  	
   

  
	
  “Asset Disposition Offer Period”

  	
   

  	
  6.11(b)

  	
   

  
	
  “Asset Disposition Purchase Date”

  	
   

  	
  6.11(b)

  	
   

  
	
  “Change of Control Payment”

  	
   

  	
  6.14(1)

  	
   

  
	
  “Excess Proceeds”

  	
   

  	
  6.11

  	
   

  
	
  “Funding Guarantor”

  	
   

  	
  9.04

  	
   

  
	
  “General Partner”

  	
   

  	
  2.02
  (definition of “Indebtedness”)

  	
   

  
	
  “Joint Venture”

  	
   

  	
  2.02
  (definition of “Indebtedness”)

  	
   

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  	
   

  
	
  “Obligations”

  	
   

  	
  9.01

  	
   

  
	
  “Pari Passu Notes”

  	
   

  	
  6.11(a)

  	
   

  
	
  “Payment Default”

  	
   

  	
  3.02(6)(a)

  	
   

  
	
  “Qualifying SLB”

  	
   

  	
  2.02
  (clause (20) of the definition of “Asset Disposition”)

  	
   

  



 


37
















 


	
  Term

  	
   

  	
  Defined
  in Section

  	
   

  
	
  “Reinstatement Date”

  	
   

  	
  6.05

  	
   

  
	
  “Restricted Payment”

  	
   

  	
  6.08(a)

  	
   

  
	
  “Successor Company”

  	
   

  	
  4.02(1)

  	
   

  
	
  “Suspended Covenants”

  	
   

  	
  6.05

  	
   

  
	
  “Suspension Period”

  	
   

  	
  6.05

  	
   

  



 


ARTICLE THREE

EVENTS OF DEFAULT WITH RESPECT TO THE NOTES


 


SECTION 3.01              Original
Indenture


 


Sections 501, 502 and 513 of
the Original Indenture shall not apply to the Notes; and, insofar as relating
to the Notes, any reference to Section 501, 502 or 513 in the Original
Indenture shall instead be deemed to refer to Section 3.02, 3.03
or 3.04, respectively, of this First Supplemental Indenture.


 


SECTION 3.02              Events
of Default


 


“Event
of Default,” whenever used in the Original Indenture or this
First Supplemental Indenture with respect to the Notes, means any one of the
following events:


 


(1)           default in any payment of
interest, including Additional Interest, on any Note when due, continued for 30
days;


 


(2)           default in the payment of
principal of or premium, if any, on any Note when due at its Stated Maturity,
upon optional redemption, upon required repurchase, upon declaration or
otherwise;


 


(3)           failure by the Company or
any Subsidiary Guarantor to comply with its obligations under Article Four
of this First Supplemental Indenture;


 


(4)           failure by the Company to
comply for 30 days after notice as provided below with any of its obligations
under Sections 6.06, 6.08, 6.09, 6.10, 6.11,
6.12, 6.13, 6.14, 6.16 or 6.17 of this First
Supplemental Indenture (in each case, other than a failure to purchase Notes
which constitutes an Event of Default under clause (2) above);


 


(5)           (a) failure by the
Company to comply with Section 6.15 of this First Supplemental
Indenture for 180 days (and, to the extent Section 314(a) of the TIA
is deemed to be a part of the Indenture pursuant to Section 318 of the TIA,
failure by the Company to comply with such deemed covenant for such period of
time as is necessary such that such period ends at the end of such 180-day
period); or (b) failure by the Company to comply for 60 days after notice
as provided below with its other agreements contained in the Indenture;


 


(6)           default under any mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any Indebtedness for 


 


38

















 


money
borrowed by the Company or any of its Restricted Subsidiaries (or the payment
of which is Guaranteed by the Company or any of its Restricted Subsidiaries),
other than Indebtedness owed to the Company or a Restricted Subsidiary, whether
such Indebtedness or Guarantee now exists, or is created after the Issue Date,
which default:


 


(a)           is caused by a failure to
pay principal of, or interest or premium, if any, on such Indebtedness prior to
the expiration of the grace period provided in such Indebtedness (“Payment Default”); or


 


(b)           results in the acceleration
of such Indebtedness prior to its maturity;


 


and, in each case, the
principal amount of any such Indebtedness, together with the principal amount
of any other such Indebtedness under which there has been a Payment Default or
the maturity of which has been so accelerated, aggregates $25.0 million or
more;


 


(7)           (a)            the Company or
any Significant Subsidiary or a group of Restricted Subsidiaries that, taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law:


 


(i)             commences a voluntary case
or proceeding;


 


(ii)            consents to the entry of
judgment, decree or order for relief against it in an involuntary case or
proceeding;


 


(iii)           consents to the appointment
of a Custodian of it or for any substantial part of its property;


 


(iv)           makes a general assignment
for the benefit of its creditors;


 


(v)            consents to or acquiesces in
the institution of a bankruptcy or an insolvency proceeding against it; or


 


(vi)           takes any corporate action
to authorize or effect any of the foregoing;


 


or takes any comparable action under any
foreign laws relating to insolvency; or


 


(b)           a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:


 


(i)             is for relief against the
Company or any Significant Subsidiary or a group of Restricted Subsidiaries
that, taken together (as of the latest audited consolidated financial
statements for the Company 


 


39

















 


and its Restricted
Subsidiaries), would constitute a Significant Subsidiary in an involuntary
case;


 


(ii)            appoints a Custodian of the
Company or any Significant Subsidiary or a group of Restricted Subsidiaries
that, taken together (as of the latest audited consolidated financial
statements for the Company and its Restricted Subsidiaries), would constitute a
Significant Subsidiary or for any substantial part of its property; or


 


(iii)           orders the winding up or
liquidation of the Company or any Significant Subsidiary or a group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary;


 


or any similar relief is granted under any
foreign laws and the order, decree or relief remains unstayed and in effect for
60 days;


 


(8)           failure by the Company or
any Significant Subsidiary or group of Restricted Subsidiaries that, taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary to pay final judgments aggregating in excess of $25.0 million (net
of any amounts covered by insurance with a reputable and creditworthy insurance
company that has not disclaimed liability therefor in writing), which judgments
are not paid, discharged or stayed for a period of 60 days; or


 


(9)           (a) any Subsidiary
Guarantee of a Significant Subsidiary or group of Restricted Subsidiaries that,
taken together (as of the latest audited consolidated financial statements for
the Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary (i) ceases to be in full force and effect (except as
contemplated by the terms of the Indenture) for 5 Business Days after notice as
provided below or (ii) is declared null and void in a judicial proceeding
or (b) any Subsidiary Guarantor that is a Significant Subsidiary or group
of Subsidiary Guarantors that taken together as of the latest audited
consolidated financial statements of the Company and its Restricted
Subsidiaries would constitute a Significant Subsidiary denies or disaffirms its
obligations under the Indenture or its Subsidiary Guarantee.


 


However, a Default under clauses (4),
(5)(b) and (9)(a)(i) of this Section 3.02
shall not constitute an Event of Default until the Trustee or the Holders of
25% in principal amount of the outstanding Notes notify the Company of the
Default and the Company does not cure such Default within the time specified in
clauses (4), (5)(b) and (9)(a)(i) of this Section 3.02
after receipt of such notice.


 


40

















 


During the continuance of a
Default under clause (5)(a) above of this Section 3.02,
the interest rate on the Notes shall increase by the Additional Interest.


 


SECTION 3.03              Acceleration


 


With respect to the Notes,
if an Event of Default (other than an Event of Default described in clause (7) of
Section 3.02 of this First Supplemental Indenture) occurs and is
continuing, the Trustee by notice to the Company, or the Holders of at least
25% in principal amount of the outstanding Notes by notice to the Company and
the Trustee, may, and the Trustee at the request of such Holders shall, declare
the principal of, premium, if any, and accrued and unpaid interest, if any, on
all the Notes to be due and payable. Upon such a declaration, such principal,
premium and accrued and unpaid interest shall be immediately due and payable.
In the event of a declaration of acceleration of the Notes because an Event of
Default described in clause (6) of Section 3.02 of
this First Supplemental Indenture has occurred and is continuing, the declaration
of acceleration of the Notes shall be automatically annulled if the default
triggering such Event of Default pursuant to clause (6) shall
be remedied or cured by the Company or a Restricted Subsidiary or waived by the
Holders of the relevant Indebtedness within 20 days after the declaration of
acceleration with respect thereto and if (1) the annulment of the
acceleration of the Notes would not conflict with any judgment or decree of a
court of competent jurisdiction and (2) all existing Events of Default,
except nonpayment of principal, premium or interest on the Notes that became
due solely because of the acceleration of the Notes, have been cured or waived.
If an Event of Default described in clause (7) of Section 3.02
of this First Supplemental Indenture occurs and is continuing, the principal
of, premium, if any, and accrued and unpaid interest on all the Notes shall
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holders. The Holders of a majority in
principal amount of the outstanding Notes may waive all past defaults (except
with respect to nonpayment of principal, premium or interest) and rescind any
such acceleration with respect to the Notes and its consequences if (1) rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction and (2) all existing Events of Default, other than the
nonpayment of the principal of, premium, if any, and interest on the Notes that
have become due solely by such declaration of acceleration, have been cured or
waived.


 


SECTION 3.04              Control
by Holders


 


Subject to Section 509
of the Original Indenture, with respect to the Notes, the Holders of a majority
in principal amount of the outstanding Notes may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
of exercising any trust or power conferred on the Trustee, provided
that the Trustee may refuse to follow any direction:


 


(1)           that conflicts with law or
the Indenture, and


 


(2)           subject to Sections 601 and
602 of the Original Indenture, that the Trustee determines is unduly
prejudicial to the rights of other Holders or would involve the Trustee in
personal liability;


 


provided, however, that the
Trustee may take any other action deemed proper by the Trustee that is not
inconsistent with such direction. Prior to taking any action hereunder, the
Trustee shall be 


 


41

















 


entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses
caused by taking or not taking such action.


 


ARTICLE FOUR

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER

OR LEASE WITH RESPECT TO THE NOTES


 


SECTION 4.01              Original
Indenture


 


Article Eight of the
Original Indenture shall not apply to the Notes.


 


SECTION 4.02              Company
May Consolidate, Etc., Only on Certain Terms


 


With respect to the Notes,
the Company shall not consolidate with or merge with or into, or convey,
transfer or lease all or substantially all its assets to, any Person, unless:


 


(1)           the resulting, surviving or
transferee Person (the “Successor Company”)
shall be a corporation organized and existing under the laws of the United
States of America, any State of the United States or the District of Columbia
and the Successor Company (if not the Company) shall expressly assume, by
supplemental indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of the Company under the Notes
and the Indenture;


 


(2)           immediately after giving
effect to such transaction (and treating any Indebtedness that becomes an
obligation of the Successor Company or any Subsidiary of the Successor Company
as a result of such transaction as having been Incurred by the Successor
Company or such Subsidiary at the time of such transaction), no Default or
Event of Default shall have occurred and be continuing;


 


(3)           immediately after giving
effect to such transaction, the Successor Company would be able to Incur at
least $1.00 of additional Indebtedness pursuant to Section 6.06(a) of
this First Supplemental Indenture or the Consolidated Coverage Ratio for the
Successor Company and its Restricted Subsidiaries would be greater than such
ratio for the Company and its Restricted Subsidiaries immediately prior to such
transaction;


 


(4)           each Subsidiary Guarantor
(unless it is the other party to the transactions above, in which case clause (1) of
this Section 4.02 shall apply or unless the Company is the
Successor Company and such Subsidiary Guarantor was a Subsidiary Guarantor
immediately prior to such transaction) shall have by supplemental indenture
confirmed that its Subsidiary Guarantee shall apply to such Person’s
obligations in respect of the Indenture and the Notes; and


 


(5)           the Company shall have
delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel,
together stating that such consolidation, merger or transfer and such
supplemental indenture (if any) comply with the Indenture.


 


42

















 


For purposes of this Section 4.02,
the sale, lease, conveyance, assignment, transfer, or other disposition of all
or substantially all of the properties and assets of one or more Subsidiaries
of the Company, which properties and assets, if held by the Company instead of
such Subsidiaries, would constitute all or substantially all of the properties
and assets of the Company on a consolidated basis, shall be deemed to be the
transfer of all or substantially all of the properties and assets of the
Company.


 


Notwithstanding the
preceding clause (3) of this Section 4.02, (a) any
Restricted Subsidiary may consolidate with, merge into or transfer all or part
of its properties and assets to the Company or any Subsidiary Guarantor and (b) the
Company may merge with an Affiliate incorporated solely for the purpose of
reincorporating the Company in another jurisdiction to realize tax benefits; provided that, in the case of a Restricted Subsidiary that
merges into the Company or any Subsidiary Guarantor, the Company shall not be
required to comply with the preceding clause (5) of this Section 4.02.


 


SECTION 4.03              Successor
Substituted


 


With respect to the Notes,
upon any consolidation of the Company with, or merger of the Company into, any
other Person or any conveyance, transfer or lease of all or substantially all
its assets in accordance with Section 4.02 of this First
Supplemental Indenture, the successor Person formed by such consolidation or
into which the Company is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under the Indenture with the same effect as if such
successor Person had been named as the Company herein, and the predecessor
Company shall be released from its obligations under the Indenture, but, in the
case of a lease of all or substantially all its assets, the predecessor Company
shall not be released from the obligation to pay the principal of and interest
on the Notes.


 


SECTION 4.04              Subsidiary
Guarantors May Consolidate, Etc., Only on Certain Terms


 


With respect to the Notes,
the Company shall not permit any Subsidiary Guarantor to consolidate with,
merge with or into any Person (other than the Company or another Subsidiary
Guarantor) and shall not permit the conveyance, transfer or lease of all or
substantially all of the assets of any Subsidiary Guarantor (other than to the
Company or another Subsidiary Guarantor) unless:


 


(1)           (a) if such entity
remains a Subsidiary Guarantor, the resulting, surviving or transferee Person
shall be a corporation, partnership, trust or limited liability company
organized and existing under the laws of the United States of America, any
State of the United States or the District of Columbia and shall have by
supplemental indenture confirmed that its Subsidiary Guarantee shall apply to
such Person’s obligations in respect of the Indenture and the Notes; (b) immediately
after giving effect to such transaction (and treating any Indebtedness that
becomes an obligation of the resulting, surviving or transferee Person or any
Restricted Subsidiary as a result of such transaction as having been Incurred
by such Person or such Restricted Subsidiary at the time of such transaction),
no Default or Event of Default shall have occurred and be 


 


43

















 


continuing;
and (c) the Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, together stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with the Indenture; and


 


(2)           the transaction is made in
compliance with Section 6.11 of this First Supplemental Indenture
(it being understood that only such portion of the Net Available Cash as is
required to be applied on the date of such transaction in accordance with the
terms of the Indenture needs to be applied in accordance therewith at such
time), Section 6.13 of this First Supplemental Indenture and this Article Four.


 


ARTICLE FIVE

SUPPLEMENTAL INDENTURES WITH RESPECT TO THE NOTES


 


SECTION 5.01              Original
Indenture


 


Sections 901 and 902 of the
Original Indenture shall not apply to the Notes; and, insofar as relating to
the Notes, any reference in the Original Indenture to Sections 901 or 902
thereof shall refer instead to Section 5.02 or Section 5.03 of this
First Supplemental Indenture.  Any
reference in the Original Indenture to Article Nine thereof shall be
deemed to refer to such Article Nine as modified to include Sections 5.02
and 5.03 hereof in lieu of Sections 901 and 902 of the Original Indenture.


 


SECTION 5.02              Supplemental
Indentures Without Consent of Holders


 


With respect to the Notes,
without the consent of any Holder, the Company, any Subsidiary Guarantors and
the Trustee may amend the Indenture and the Notes to:


 


(1)           cure any ambiguity,
omission, defect or inconsistency;


 


(2)           provide for the assumption
by a successor Person of the obligations of the Company or any Subsidiary
Guarantor under the Indenture;


 


(3)           provide for uncertificated
Notes in addition to or in place of certificated Notes (provided
that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of
the Code, or in a manner such that the uncertificated Notes are described in Section 163(f) (2) (B) of
the Code);


 


(4)           add Guarantees with respect
to the Notes or release a Subsidiary Guarantor from its obligations under its
Subsidiary Guarantee or the Indenture in accordance with the applicable
provisions of the Indenture;


 


(5)           secure the Notes;


 


(6)           add to the covenants of the
Company for the benefit of the Holders or surrender any right or power
conferred upon the Company;


 


(7)           make any change that does
not adversely affect the rights of any Holder;


 


44

















 


(8)           comply with any requirement
of the Commission in connection with the qualification of the Indenture under
the Trust Indenture Act;


 


(9)           provide for the appointment
of a successor Trustee; provided that
the successor Trustee is otherwise qualified and eligible to act as such under
the terms of the Indenture; or


 


(10)         conform the text of the
Indenture, the Notes or the Subsidiary Guarantees to any provision of the “Description
of Notes” contained in the Prospectus Supplement to the extent that such
provision in the “Description of Notes” contained in the Prospectus Supplement
is intended to be a verbatim recitation of a provision of the Indenture, the
Notes or the Subsidiary Guarantees.


 


After an amendment under
this Section 5.02 becomes effective, the Company shall mail to
Holders a notice briefly describing such amendment. The failure to give such
notice to all Holders, or any defect therein, shall not impair or affect the
validity of an amendment under this Section 5.02.


 


SECTION 5.03              Supplemental
Indentures With Consent of Holders


 


The Company, any Subsidiary
Guarantors and the Trustee may amend or supplement the Indenture or the Notes
without notice to any Holder but with the written consent of the Holders of at
least a majority in principal amount of the Notes then outstanding (including
without limitation, consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes) and, subject to the exceptions set
forth in Section 514 of the Original Indenture, any past default or
compliance with any provisions of the Indenture may be waived with respect to
the Notes with the consent of the Holders of a majority in principal amount of
the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, Notes).
However, without the consent of each Holder affected, an amendment, supplement
or waiver may not:


 


(1)           reduce the amount of Notes
whose Holders must consent to an amendment;


 


(2)           reduce the stated rate of or
extend the stated time for payment of interest on any Note;


 


(3)           reduce the principal of or
extend the Stated Maturity of any Note;


 


(4)           reduce the premium payable
upon the redemption or repurchase of any Note or change the time at which any
Note may be redeemed or repurchased pursuant to Sections 6.11, 6.14
or 7.05 of this First Supplemental Indenture whether through an
amendment or waiver of provisions in the covenants, definitions or otherwise
(except amendments to the definitions of “Change of Control” and “Permitted
Holder”);


 


(5)           make any Note payable in
money other than that stated in the Note;


 


45

















 


(6)           impair the right of any
Holder to receive payment of principal, premium, if any, and interest on such Holder’s
Notes on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such Holder’s Notes;


 


(7)           make any change in the
amendment provisions which require each Holder’s consent or in the waiver provisions;


 


(8)           modify the ranking of the
Notes in any manner that adversely affects the rights of any Holder of Notes;
or


 


(9)           modify the Subsidiary
Guarantees in any manner adverse to the Holders of the Notes.


 


It shall not be necessary
for the consent of the Holders under this Section 5.03 to approve
the particular form of any proposed amendment, but it shall be sufficient if
such consent approves the substance thereof. A consent to any amendment or
waiver under the Indenture by any Holder of the Notes given in connection with
a tender of such Holder’s Notes shall not be rendered invalid by such tender.


 


After an amendment under
this Section 5.03 becomes effective, the Company shall mail to
Holders a notice briefly describing such amendment. The failure to give such
notice to all Holders, or any defect therein, shall not impair or affect the
validity of an amendment under this Section 5.03.


 


ARTICLE SIX

COVENANTS WITH RESPECT TO THE NOTES


 


SECTION 6.01              Original
Indenture


 


(a)           Sections
1001, 1005 and 1007 of the Original Indenture shall not apply to the Notes.


 


(b)           The last
word of Section 1008 of the Original Indenture shall be deleted and
replaced with the word “amendment”.


 


(c)           With
respect to the Notes, the references in Section 1009 of the Original
Indenture to (1) Section 901(2) shall also include Section 5.02(6) of
this First Supplemental Indenture, and (2) Section 1005 of the
Original Indenture shall be amended to refer to Section 6.03 of
this First Supplemental Indenture.


 


SECTION 6.02              Payment
of Principal, Premium and Interest


 


The Company covenants and
agrees for the benefit of the Notes that it shall duly and punctually pay the
principal of and any premium and interest on the Notes in accordance with the
terms of the Notes and the Indenture.


 


46

















 


The Company shall pay
interest on overdue principal at the rate specified therefor in the Notes, and
it shall pay interest on overdue installments of interest at the same rate to
the extent lawful.


 


SECTION 6.03              Existence


 


Subject to Article Four
and Section 9.02 of this First Supplemental Indenture, the Company
and each of the Subsidiary Guarantors shall do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence
and that of each Restricted Subsidiary and the corporate rights (charter and
statutory), licenses and franchises of the Company and each Restricted
Subsidiary; provided, however, that the Company
shall not be required to preserve any such existence (except the Company),
right, license or franchise if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct
of the business of the Company and each of its Restricted Subsidiaries, taken
as a whole, and that the loss thereof would not have a material adverse effect
on the ability of the Company to perform its obligations under the Notes or the
Indenture, provided, further, the Company and each
Restricted Subsidiary may merge in accordance with Article Four and
Section 9.02 of this First Supplemental Indenture.


 


SECTION 6.04              Statement
by Officers as to Default


 


The Company shall deliver to
the Trustee, as soon as possible and in any event within thirty days after the
Company becomes aware of the occurrence of any Event of Default or an event
which, with notice or the lapse of time or both, would constitute a certain
Default, an Officers’ Certificate setting forth the details of such Event of
Default or default and the action which the Company is taking or proposing to
take with respect thereto.


 


SECTION 6.05              Effectiveness
of Covenants


 


Following the first day on
which:


 


(a)           the Notes
have an Investment Grade Rating from both of the Ratings Agencies; and


 


(b)           no Default
has occurred and is continuing under the Indenture;


 


the Company and its
Restricted Subsidiaries shall not be subject to Sections 6.06, 6.08,
6.10, 6.11, 6.12, 6.13, 6.17, and clause (3) of
Section 4.02 of this First Supplemental Indenture (collectively,
the “Suspended Covenants”). If at any
time the Notes’ credit rating is downgraded from an Investment Grade Rating by
any Rating Agency or a Default or Event of Default occurs and is continuing,
then the Suspended Covenants shall thereafter be reinstated as if such
covenants had never been suspended (the “Reinstatement Date”)
and thereafter be applicable pursuant to the terms of the Indenture (including
in connection with performing any calculation or assessment to determine
compliance with the terms of the Indenture), unless and until the Notes
subsequently attain an Investment Grade Rating (in which event the Suspended
Covenants shall no longer be in effect for such time that the Notes maintain an
Investment Grade Rating and no Default or Event of Default has occurred and is
continuing);


 


47
















 


provided, however, that no
Default, Event of Default or breach of any kind shall be deemed to exist under
the Indenture, the Notes or the Subsidiary Guarantees with respect to the
Suspended Covenants based on, and none of the Company or any of its Subsidiaries
shall bear any liability for, any actions taken or events occurring after the
Notes attain an Investment Grade Rating and before any reinstatement of such
Suspended Covenants as provided above, or any actions taken at any time
pursuant to any contractual obligation arising prior to such reinstatement,
regardless of whether such actions or events would have been permitted if the
applicable Suspended Covenants remained in effect during such period. The
period of time between the date of suspension of the covenants and the
Reinstatement Date is referred to as the “Suspension Period.”


 


On the Reinstatement Date,
all Indebtedness Incurred during the Suspension Period shall be classified to
have been Incurred pursuant to Section 6.06(a) of this First
Supplemental Indenture or one of the clauses set forth in Section 6.06(b) of
this First Supplemental Indenture (to the extent such Indebtedness would be
permitted to be Incurred thereunder as of the Reinstatement Date and after
giving effect to Indebtedness Incurred prior to the Suspension Period and
outstanding on the Reinstatement Date). To the extent such Indebtedness would
not be so permitted to be Incurred pursuant to the Section 6.06(a) or
(b) of this First Supplemental Indenture, such Indebtedness shall
be deemed to have been outstanding on the Issue Date, so that it is classified
as permitted under clause (4)(b) of Section 6.06(b) of
this First Supplemental Indenture. Calculations made after the Reinstatement
Date of the amount available to be made as Restricted Payments under Section 6.08
of this First Supplemental Indenture shall be made as though Section 6.08
of this First Supplemental Indenture had been in effect since the Issue Date
and throughout the Suspension Period. Accordingly, Restricted Payments made
during the Suspension Period shall reduce the amount available to be made as
Restricted Payments under Section 6.08(a) of this First
Supplemental Indenture.


 


During any period when the
Suspended Covenants are suspended, the Board of Directors of the Company may
not designate any of the Company’s Subsidiaries as Unrestricted Subsidiaries
pursuant to the Indenture.


 


SECTION 6.06              Limitation
on Indebtedness


 


(a)                                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, Incur any Indebtedness (including Acquired
Indebtedness); provided, however, that the
Company and any Subsidiary Guarantor may Incur Indebtedness if on the date
thereof:


 


(1)           the Consolidated Coverage Ratio for
the Company and its Restricted Subsidiaries is at least 2.50 to 1.00; and


 


(2)           no Default or Event of Default shall
have occurred or be continuing or would occur as a consequence of Incurring the
Indebtedness or transactions relating to such Incurrence.


 


(b)                                 Section 6.06(a) of
this First Supplemental Indenture shall not prohibit the Incurrence of the
following Indebtedness:


 


48

















 


(1)                                  Indebtedness of the Company or any Subsidiary Guarantor
Incurred pursuant to Credit Facilities in an aggregate amount outstanding at
any time up to the greater of (a) $1.0 billion and (b) 30% of
Adjusted Consolidated Net Tangible Assets determined as of the date of the
Incurrence of such Indebtedness;


 


(2)                                  Guarantees by (a) the Company or Subsidiary Guarantors
of Indebtedness Incurred by the Company or a Subsidiary Guarantor in accordance
with the provisions of the Indenture; provided that
in the event such Indebtedness that is being Guaranteed is a Subordinated
Obligation or a Guarantor Subordinated Obligation, then the related Guarantee
shall be subordinated in right of payment to the Notes or the Subsidiary
Guarantee, as the case may be, and (b) Non-Guarantor Restricted
Subsidiaries of Indebtedness Incurred by Non-Guarantor Restricted Subsidiaries
in accordance with the provisions of the Indenture;


 


(3)                                  Indebtedness of the Company owing to and held by any
Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing to and
held by the Company or any Restricted Subsidiary; provided,
however,


 


(A)          if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior payment
in full in cash of all obligations with respect to the Notes;


 


(B)           if a Subsidiary Guarantor is the
obligor on such Indebtedness and the Company or a Subsidiary Guarantor is not
the obligee, such Indebtedness is subordinated in right of payment to the
Subsidiary Guarantee of such Subsidiary Guarantor; and


 


(C)           (i) any subsequent issuance or
transfer of Capital Stock or any other event which results in any such
Indebtedness being beneficially held by a Person other than the Company or a
Restricted Subsidiary of the Company; and (ii) any sale or other transfer
of any such Indebtedness to a Person other than the Company or a Restricted
Subsidiary of the Company shall be deemed, in each case, to constitute an
Incurrence of such Indebtedness by the Company or such Subsidiary, as the case
may be.


 


(4)                                  Indebtedness represented by (a) the Notes issued on the
Issue Date and the Subsidiary Guarantees, (b) any Indebtedness (other than
the Indebtedness described in clauses (1), (2), (3), (6),
(8), (9) and (10) of this Section 6.06(b))
outstanding on the Issue Date and (c) any Refinancing Indebtedness
Incurred in respect of any Indebtedness described in this clause (4) or
clause (5) of this Section 6.06(b) or
Incurred pursuant to Section 6.06(a) of this First
Supplemental Indenture;


 


(5)                                  Indebtedness of a Restricted Subsidiary Incurred and
outstanding on the date on which such Restricted Subsidiary was acquired by, or
merged into, the Company or any Restricted Subsidiary or such Restricted
Subsidiary was designated as such (other than Indebtedness Incurred (a) to
provide all or any portion of the funds utilized to consummate the transaction
or series of related transactions pursuant to which such


 


49

















 


Restricted Subsidiary became a
Restricted Subsidiary or was otherwise acquired by the Company or (b) otherwise
in connection with, or in contemplation of, such acquisition); provided, however, that at the time such Restricted
Subsidiary is so acquired, merged or designated, the Company would have been
able to Incur $1.00 of additional Indebtedness pursuant to Section 6.06(a) of
this First Supplemental Indenture after giving effect to the Incurrence of such
Indebtedness pursuant to this clause (5);


 


(6)           Indebtedness under Hedging
Obligations that are Incurred in the ordinary course of business (and not for
speculative purposes) (a) for the purpose of fixing or hedging interest
rate risk with respect to any Indebtedness permitted under the Indenture; (b) for
the purpose of fixing or hedging currency exchange rate risk with respect to
any currency exchanges; or (c) for the purpose of fixing or hedging
commodity price risk with respect to any commodities;


 


(7)           the Incurrence by the Company or any
of its Restricted Subsidiaries of Indebtedness represented by Capitalized Lease
Obligations, mortgage financings, purchase money obligations or other payments,
in each case Incurred to finance all or any part of the purchase price or cost
of construction or improvement of assets or property (other than Capital Stock
or other Investments) acquired, constructed or improved by the Company or such
Restricted Subsidiary and related financing costs, and Attributable Indebtedness,
and all Refinancing Indebtedness Incurred to refund, defease, renew, extend,
refinance or replace any Indebtedness Incurred pursuant to this clause (7),
in an aggregate principal amount not to exceed $25.0 million at any time
outstanding;


 


(8)           Indebtedness Incurred in respect of
workers’ compensation claims, self-insurance obligations, performance, surety
and similar bonds and completion guarantees provided by the Company or a
Restricted Subsidiary in the ordinary course of business;


 


(9)           Indebtedness arising from agreements
of the Company or a Restricted Subsidiary providing for indemnification,
adjustment of purchase price or similar obligations, in each case, Incurred or
assumed in connection with the acquisition or disposition of any business,
assets or Capital Stock of a Restricted Subsidiary or any business or assets of
the Company and Refinancing Indebtedness Incurred with the same counterparty in
respect thereof, provided that the maximum
aggregate liability in respect of all such Indebtedness shall at no time exceed
the gross proceeds actually paid or received by the Company and its Restricted
Subsidiaries in connection with such acquisition or disposition;


 


(10)         Indebtedness arising from the honoring
by a bank or other financial institution of a check, draft or similar
instrument (except in the case of daylight overdrafts) drawn against
insufficient funds or in respect of cash management services provided by a bank
or other financial institution, each in the ordinary course of business, provided, however, that such Indebtedness is extinguished
within five Business Days of Incurrence;


 


(11)         Indebtedness in respect of the
financing of insurance premiums with the providers of such insurance or their
Affiliates in the ordinary course of business;


 


50

















 


(12)         for the avoidance of doubt, in-kind
obligations relating to net oil or natural gas balancing positions arising in
the ordinary course of business; and


 


(13)         in addition to the items referred to in
clauses (1) through (12) above, Indebtedness of the
Company and its Restricted Subsidiaries in an aggregate outstanding principal
amount which, when taken together with the principal amount of all other
Indebtedness Incurred pursuant to this clause (13) and then
outstanding, shall not exceed $20.0 million at any time outstanding.


 


The Company shall not Incur
any Indebtedness under the preceding paragraph if the proceeds thereof are
used, directly or indirectly, to refinance any Subordinated Obligations of the
Company unless such Indebtedness shall be subordinated to the Notes to at least
the same extent as such Subordinated Obligations. No Subsidiary Guarantor shall
Incur any Indebtedness under the preceding paragraph if the proceeds thereof
are used, directly or indirectly, to refinance any Guarantor Subordinated
Obligations of such Subsidiary Guarantor unless such Indebtedness shall be
subordinated to the obligations of such Subsidiary Guarantor under its
Subsidiary Guarantee to at least the same extent as such Guarantor Subordinated
Obligations.  No Restricted Subsidiary
(other than a Subsidiary Guarantor) may Incur any Indebtedness if the proceeds
are used to refinance Indebtedness of the Company or a Subsidiary Guarantor.


 


(c)                                  For purposes of determining compliance with, and the
outstanding principal amount of any particular Indebtedness Incurred pursuant
to and in compliance with, this Section 6.06:


 


(1)           in the event that Indebtedness meets
the criteria of more than one of the types of Indebtedness described in this Section 6.06,
the Company, in its sole discretion, shall classify such item of Indebtedness
on the date of Incurrence and may from time to time re-classify such item of
Indebtedness in any manner that complies with this Section 6.06 and
only be required to include the amount and type of such Indebtedness in one of
such clauses; provided that all Indebtedness
outstanding on the Issue Date under the Senior Credit Facility shall be deemed
Incurred under clause (1) of Section 6.06(b) and
not Section 6.06(a) of this First Supplemental Indenture or clause (4) of
Section 6.06(b);


 


(2)           Guarantees of, or obligations in
respect of letters of credit relating to, Indebtedness which is otherwise
included in the determination of a particular amount of Indebtedness shall not
be included;


 


(3)           if obligations in respect of letters
of credit are Incurred pursuant to a Credit Facility and are being treated as
Incurred pursuant to clause (1) of Section 6.06(b) and
the letters of credit relate to other Indebtedness, then such other
Indebtedness shall not be included;


 


(4)           the principal amount of any
Disqualified Stock of the Company or a Restricted Subsidiary, or Preferred
Stock of a Restricted Subsidiary that is not a Subsidiary Guarantor, shall be
equal to the greater of the maximum mandatory


 


51

















 


redemption or repurchase price (not
including, in either case, any redemption or repurchase premium) or the
liquidation preference thereof;


 


(5)           Indebtedness permitted by this Section 6.06
need not be permitted solely by reference to one provision permitting such
Indebtedness but may be permitted in part by one such provision and in part by
one or more other provisions of this Section 6.06 permitting such
Indebtedness;


 


(6)           the principal amount of any
Indebtedness outstanding in connection with a securitization transaction or
series of securitization transactions is the amount of obligations outstanding
under the legal documents entered into as part of such transaction that would
be characterized as principal if such transaction were structured as a secured
lending transaction rather than as a purchase relating to such transaction; and


 


(7)           the amount of Indebtedness issued at
a price that is less than the principal amount thereof shall be equal to the
amount of the liability in respect thereof determined in accordance with GAAP.


 


Accrual of interest, accrual
of dividends, the accretion of accreted value, the payment of interest in the
form of additional Indebtedness, the payment of dividends in the form of
additional shares of Preferred Stock or Disqualified Stock and the incurrence
of unrealized losses or charges in respect of Hedging Obligations (including
those resulting from the application of FAS 133 and similar provisions), in
each case shall be deemed not to be Incurrences of Indebtedness for purposes of
this Section 6.06. The amount of any Indebtedness outstanding as of
any date shall be (i) the accreted value thereof in the case of any
Indebtedness issued with original issue discount and (ii) the principal
amount or liquidation preference thereof, together with any interest thereon
that is more than 30 days past due, in the case of any other Indebtedness.


 


In addition, the Company
shall not permit any of its Unrestricted Subsidiaries to Incur any Indebtedness
or issue any shares of Disqualified Stock, other than Non Recourse Debt. If at
any time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any
Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted
Subsidiary as of such date (and, if such Indebtedness is not permitted to be
Incurred as of such date under this Section 6.06, the Company shall
be in Default of this Section 6.06).


 


For purposes of determining
compliance with any U.S. dollar denominated restriction on the Incurrence of
Indebtedness, the U.S. dollar equivalent principal amount of Indebtedness
denominated in a foreign currency shall be calculated based on the relevant
currency exchange rate in effect on the date such Indebtedness was Incurred, in
the case of term Indebtedness, or first committed, in the case of revolving
credit Indebtedness; provided that
if such Indebtedness is Incurred to refinance other Indebtedness denominated in
a foreign currency, and such refinancing would cause the applicable U.S.
dollar-denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such U.S.
dollar-denominated restriction shall be deemed not to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of such Indebtedness being refinanced. Notwithstanding any
other provision of this Section 6.06, the


 


52

















 


maximum
amount of Indebtedness that the Company may Incur pursuant to this Section 6.06
shall not be deemed to be exceeded solely as a result of fluctuations in the
exchange rate of currencies. The principal amount of any Indebtedness Incurred
to refinance other Indebtedness, if Incurred in a different currency from the
Indebtedness being refinanced, shall be calculated based on the currency
exchange rate applicable to the currencies in which such Refinancing
Indebtedness is denominated that is in effect on the date of such refinancing.


 


SECTION 6.07              Calculation of Original Issue Discount


 


The Company shall file with
the Trustee within 30 days of the end of each calendar year (i) a written
notice specifying the amount of original issue discount (including daily rates
and accrual periods) accrued on the Notes as of the end of such year and (ii) such
other specific information relating to such original issue discount as may be
required under the Code.


 


SECTION 6.08              Limitation
on Restricted Payments


 


(a)                                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries, directly or indirectly, to:


 


(1)                                  declare or pay any dividend or make any distribution (whether
made in cash, securities or other property) on or in respect of its Capital
Stock (including any payment in connection with any merger or consolidation
involving the Company or any of its Restricted Subsidiaries) except:


 


(A)          dividends or distributions payable in
Capital Stock of the Company (other than Disqualified Stock); and


 


(B)           dividends or distributions payable to
the Company or another Restricted Subsidiary (and if such Restricted Subsidiary
is not a Wholly Owned Subsidiary, to its other holders of common Capital Stock
on a pro rata basis);


 


(2)                                  purchase, redeem, retire or otherwise acquire for value any
Capital Stock of the Company or any direct or indirect parent of the Company
held by Persons other than the Company or a Restricted Subsidiary (other than
in exchange for Capital Stock of the Company (other than Disqualified Stock));


 


(3)                                  purchase, repurchase, redeem, defease or otherwise acquire or
retire for value, prior to scheduled maturity, scheduled repayment or scheduled
sinking fund payment, any Subordinated Obligations or Guarantor Subordinated
Obligations (other than (a) Indebtedness of the Company owing to and held
by any Subsidiary Guarantor or Indebtedness of a Subsidiary Guarantor owing to
and held by the Company or any other Subsidiary Guarantor permitted under clause (3) of
Section 6.06(b) of this First Supplemental Indenture or (b) the
purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Subordinated Obligations or Guarantor Subordinated Obligations in
anticipation of satisfying a sinking fund obligation, principal installment or
final maturity, in each case due within one year of the date of purchase,
repurchase, redemption, defeasance or other acquisition or retirement); or


 


53

















 


(4)                                  make any Restricted Investment in any Person;


 


(any such dividend, distribution,
purchase, redemption, repurchase, defeasance, other acquisition, retirement or
Restricted Investment referred to in clauses (1) through (4) above
shall be referred to herein as a “Restricted Payment”),
if at the time the Company or such Restricted Subsidiary makes such Restricted
Payment:


 


(A)                              a Default shall have occurred and be continuing (or would
result therefrom); or


 


(B)                                the Company is not able to Incur $1.00 of additional
Indebtedness pursuant to Section 6.06(a) of this First
Supplemental Indenture after giving effect, on a pro forma basis, to such
Restricted Payment as if such Restricted Payment and the use of proceeds
thereof had been made at the beginning of the applicable four-quarter period;
or


 


(C)                                the aggregate amount of such Restricted Payment and all other
Restricted Payments declared or made subsequent to the Start Date (except as
excluded by other provisions of this Section 6.08) would exceed the
sum of (all such calculations being made as if this covenant had been in effect
as of the Start Date and at all times thereafter):


 


(i)            50% of Consolidated Net Income for
the period (treated as one accounting period) from the beginning of the fiscal
quarter prior to the quarter in which the Start Date occured to the end of the
most recent fiscal quarter ending prior to the date of such Restricted Payment
for which financial statements are in existence (or, in case such Consolidated
Net Income is a deficit, minus 100% of such deficit); plus


 


(ii)           100% of the aggregate fair market
value of Qualified Proceeds received by the Company or any Subsidiary Guarantor
from the issue or sale of its Capital Stock (other than Disqualified Stock) or
other capital contributions subsequent to the Start Date (other than Qualified
Proceeds received from an issuance or sale of such Capital Stock to a
Subsidiary of the Company or an employee stock ownership plan, option plan or
similar trust to the extent such sale to an employee stock ownership plan or
similar trust is financed by loans from or Guaranteed by the Company or any
Restricted Subsidiary unless such loans have been repaid with cash on or prior
to the date of determination) excluding in any event Qualified Proceeds to the
extent used as consideration for Permitted Investments pursuant to clause (17)
of the definition of “Permitted Investments”; plus


 


(iii)          the amount by which Indebtedness of
the Company or its Restricted Subsidiaries is reduced on the Company’s balance
sheet upon the conversion or exchange (other than by a Subsidiary of the
Company) subsequent to the Start Date of any Indebtedness of the Company or its


 


54

















 


Restricted Subsidiaries convertible
or exchangeable for Capital Stock (other than Disqualified Stock) of the
Company (less the amount of any cash, or the fair market value of any other
property, distributed by the Company upon such conversion or exchange); plus


 


(iv)                              the amount equal to the net reduction in Restricted
Investments made by the Company or any of its Restricted Subsidiaries in any
Person resulting from:


 


(A)          repurchases or redemptions of such
Restricted Investments by such Person, proceeds realized upon the sale of such
Restricted Investment to an unaffiliated purchaser, repayments of loans or
advances or other transfers of assets (including by way of dividend or
distribution) by such Person to the Company or any Restricted Subsidiary (other
than for reimbursement of tax payments) and to the extent not otherwise already
included releases or reductions of Guarantees; or


 


(B)           the redesignation of Unrestricted
Subsidiaries as Restricted Subsidiaries or the merger or consolidation of an
Unrestricted Subsidiary with and into the Company or any of its Restricted
Subsidiaries (valued in each case as provided in the definition of “Investment”)
not to exceed the amount of Investments previously made by the Company or any
Restricted Subsidiary in such Unrestricted Subsidiary,


 


which amount in each case
under this clause (iv) was included in the calculation of the
amount of Restricted Payments; provided, however,
that no amount shall be included under this clause (iv) to the
extent it is already included in Consolidated Net Income.


 


(b)                                 The provisions of Section 6.08(a) of this
First Supplemental Indenture shall not prohibit:


 


(1)                                  any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Capital Stock, Disqualified Stock or Subordinated
Obligations of the Company or Guarantor Subordinated Obligations of any
Subsidiary Guarantor made by conversion into or exchange for, or out of the
proceeds of the substantially concurrent sale of, Capital Stock of the Company
(other than Disqualified Stock and other than Capital Stock issued or sold to a
Subsidiary or an employee stock ownership plan or similar trust to the extent
such sale to an employee stock ownership plan or similar trust is financed by
loans from or Guaranteed by the Company or any Restricted Subsidiary unless
such loans have been repaid with cash on or prior to the date of
determination); provided, however, that the
amount of such Restricted Payments shall be excluded in subsequent calculations
of the amount of Restricted Payments; provided, further,
that the Qualified Proceeds from such sale of Capital Stock (to the extent so
used) shall be excluded from clause (C)(ii) of Section 6.08(a) of
this First Supplemental Indenture;


 


55

















 


(2)                                  any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Subordinated Obligations of the Company or Guarantor
Subordinated Obligations of any Subsidiary Guarantor made by exchange for, or
out of the proceeds of the substantially concurrent sale or Incurrence of,
Subordinated Obligations of the Company or any purchase, repurchase,
redemption, defeasance or other acquisition or retirement of Guarantor
Subordinated Obligations made by exchange for or out of the proceeds of the
substantially concurrent sale or Incurrence of Guarantor Subordinated
Obligations that, in each case, is permitted to be Incurred pursuant to Section 6.06
of this First Supplemental Indenture and that, if Incurred under Section 6.06(b) of
this First Supplemental Indenture, in each case constitutes Refinancing
Indebtedness; provided, however, that the
amount of such Restricted Payments shall be excluded in subsequent calculations
of the amount of Restricted Payments;


 


(3)                                  any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Disqualified Stock of the Company or a Restricted
Subsidiary made by exchange for or out of the proceeds of the substantially
concurrent sale of Disqualified Stock of the Company or such Restricted
Subsidiary, as the case may be, that, in each case, is permitted to be Incurred
pursuant to Section 6.06 of this First Supplemental Indenture and
that in each case constitutes Refinancing Indebtedness; provided,
however, that the amount of such Restricted Payments shall be
excluded in subsequent calculations of the amount of Restricted Payments;


 


(4)                                  dividends paid within 60 days after the date of declaration
if at such date of declaration such dividend would have complied with this
provision; provided, however, that from and after
the date of payment thereof the amount of such Restricted Payments shall be
included in subsequent calculations of the amount of Restricted Payments;


 


(5)                                  so long as no Default or Event of Default has occurred and is
continuing,


 


(A)          the repurchase, redemption or other
acquisition or retirement for value of Capital Stock of the Company or any
direct or indirect parent of the Company held by any existing or former
employees or directors of the Company or any Subsidiary of the Company or their
assigns, estates or heirs, in each case in connection with the repurchase
provisions under employee stock option or stock purchase agreements or other
compensation-related agreements; provided that
such Capital Stock was received for services related to, or for the benefit of,
the Company and its Subsidiaries; and provided further
that such repurchases, redemptions, acquisitions and retirements pursuant to
this clause shall not exceed $2.0 million in the aggregate during any calendar
year and $5.0 million in the aggregate for all such redemptions and
repurchases, plus in each case, to the extent not previously applied, the
amount of any capital contributions to the Company as a result of sales of
Capital Stock of the Company or any direct or indirect parent of the Company to
such Persons (provided, however, that the
Qualified Proceeds from such sale of Capital Stock (to the extent so used)
shall be excluded from clause (C)(ii) of Section 6.08(a) of
this First Supplemental


 


56

















 


Indenture), plus the amount of any “key
man” insurance proceeds received by the Company or any Restricted Subsidiary to
the extent not previously applied; and


 


(B)           loans or advances to, and Guarantees
of obligations of, employees, officers or directors of the Company or any
Subsidiary of the Company the proceeds of which are used to purchase Capital
Stock of the Company or any direct or indirect parent of the Company, in an
aggregate amount not in excess of $2.0 million with respect to all loans or
advances made since the Start Date (without giving effect to the forgiveness of
any such loan); provided, however, that the
Company and its Subsidiaries shall comply in all material respects with the
provisions of the Sarbanes Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith relating to the provision of any such loans
and advances as if the Company had filed a registration statement with the
Commission;


 


provided, however, that the amount of such Restricted Payments
shall be excluded in subsequent calculations of the amount of Restricted
Payments;


 


(6)                                  so long as no Default or Event of Default has occurred and is
continuing, the declaration and payment of dividends to holders of any class or
series of Disqualified Stock of the Company issued in accordance with the terms
of the Indenture to the extent such dividends are included in the definition of
“Consolidated Interest Expense;” provided, however,
that the amount of such Restricted Payments shall be excluded in subsequent
calculations of the amount of Restricted Payments;


 


(7)                                  repurchases of Capital Stock deemed to occur upon the
exercise of stock options, warrants or other convertible securities if such
Capital Stock represents a portion of the exercise price thereof; provided, however, that the amount of such Restricted
Payments shall be excluded in subsequent calculations of the amount of Restricted
Payments;


 


(8)                                  the purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of any Subordinated Obligation or Guarantor
Subordinated Obligation (A) at a purchase price not greater than 101% of
the principal amount of such Subordinated Obligation or Guarantor Subordinated
Obligation in the event of a Change of Control in accordance with provisions
similar to Section 6.14 of this First Supplemental Indenture or (B) at
a purchase price not greater than 100% of the principal amount thereof in
accordance with provisions similar to Section 6.11 of this First
Supplemental Indenture; provided that,
prior to or simultaneously with such purchase, repurchase, redemption,
defeasance or other acquisition or retirement, the Company (or a third party,
in the case of a Change of Control Offer) has made the Change of Control Offer
or Asset Disposition Offer, as applicable, as provided in such covenant with
respect to the Notes and has completed the repurchase of all Notes validly tendered
for payment in connection with such Change of Control Offer or Asset
Disposition Offer; provided, however,
that the amount of such Restricted Payments shall be included in subsequent
calculations of the amount of Restricted Payments;


 


57
















 


(9)           (A) so long as no Event of
Default described under clauses (1) or (2) thereof
has occurred and is continuing, the declaration of dividends to holders of
Common Stock of the Company of up to $10.0 million in the aggregate for all
such dividends and the subsequent payment of such dividends and (B) so
long as no Default or Event of Default has occurred and is continuing, the
declaration of dividends to holders of Common Stock of the Company of up to
$0.36 per share per calendar year (but in no event in excess of $20.0 million
in the aggregate during any calendar year pursuant to this clause (9))
and the subsequent payment of such dividends; provided,
however, that in each case the amount of such Restricted Payments
shall be included in subsequent calculations of the amount of Restricted
Payments;


 


(10)         so long as no Default or Event of
Default has occurred and is continuing, repurchases of Common Stock pursuant to
a previously announced share repurchase program for up to an aggregate purchase
price after the Issue Date of $25.0 million; provided,
however, that the amount of such Restricted Payments shall be
included in subsequent calculations of the amount of Restricted Payments;


 


(11)         for avoidance of doubt, payments
pursuant to any customary tax sharing or tax indemnification arrangement; provided, however, that the amount of such payments shall be
excluded in subsequent calculations of the amount of Restricted Payments;


 


(12)         the payment of cash in lieu of issuance
of fractional shares of Capital Stock in connection with any transaction
otherwise permitted under this Section 6.08; provided,
however, that the amount of such Restricted Payments shall be
included in subsequent calculations of the amount of Restricted Payments;


 


(13)         payments to dissenting stockholders not
to exceed $5.0 million (A) pursuant to applicable law or (B) in
connection with the settlement or other satisfaction of legal claims made
pursuant to or in connection with a consolidation, merger or transfer of assets
in connection with a transaction that is not prohibited by the Indenture; provided, however, that such payments shall be included in
subsequent calculations of the amount of Restricted Payments; and


 


(14)         so long as no Default or Event of
Default has occurred and is continuing, Restricted Payments in an aggregate
amount not to exceed $30.0 million; provided, however,
that the amount of such Restricted Payments shall be included in subsequent
calculations of the amount of Restricted Payments.


 


The amount of all Restricted
Payments (other than cash) shall be the fair market value on the date of such
Restricted Payment of the asset(s) or securities proposed to be paid,
transferred or issued by the Company or such Restricted Subsidiary, as the case
may be, pursuant to such Restricted Payment. The fair market value of any cash
Restricted Payment shall be its face amount and any non-cash Restricted Payment
(i) of less than $5.0 million shall be determined conclusively by an
executive officer of the Company acting in good faith whose certification with
respect thereto shall be delivered to the Trustee or (ii) of $5.0 million
or more shall be determined conclusively by the Board of Directors of the
Company acting in good faith whose resolution with respect thereto shall be
delivered to the Trustee, such determination to be based


 


58

















 


upon
an opinion or appraisal issued by an accounting, appraisal or investment
banking firm of national standing if such fair market value is estimated in
good faith by the Board of Directors of the Company to exceed $25.0 million.
Not later than the date of making any Restricted Payment, the Company shall
deliver to the Trustee an Officers’ Certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by this Section 6.08 were computed, together with a copy
of any fairness opinion or appraisal required by the Indenture.


 


SECTION 6.09              Limitation
on Liens


 


The Company shall not, and
shall not permit any of its Restricted Subsidiaries to, directly or indirectly,
create, Incur or suffer to exist any Lien (other than Permitted Liens) upon any
of its property or assets (including Capital Stock of Subsidiaries), whether
owned on the Issue Date or acquired after that date, which Lien is securing any
Indebtedness, unless contemporaneously with the Incurrence of such Liens
effective provision is made to secure the Indebtedness due under the Indenture
and the Notes and, in respect of Liens on any Restricted Subsidiary’s property
or assets, any Subsidiary Guarantee of such Restricted Subsidiary, with Liens
on such property or assets (1) in the case of unsubordinated Indebtedness,
that rank equally and ratably with, or senior in priority to, the Liens
securing such other Indebtedness, and (2) in the case of Subordinated
Obligations or Guarantor Subordinated Obligations, that rank senior in priority
to the Liens securing such other Indebtedness, in each case for so long as such
other Indebtedness is so secured.


 


SECTION 6.10              Limitation
on Restrictions on Distributions from Restricted Subsidiaries


 


(a)                                  The Company shall not, and shall not permit any Restricted
Subsidiary to, create or otherwise cause or permit to exist or become effective
any consensual encumbrance or consensual restriction on the ability of any
Restricted Subsidiary to:


 


(1)           pay dividends or make any other
distributions on its Capital Stock or pay any Indebtedness or other obligations
owed to the Company or any Restricted Subsidiary (it being understood that the
priority of any Preferred Stock in receiving dividends or liquidating
distributions prior to dividends or liquidating distributions being paid on
Common Stock shall not be deemed a restriction on the ability to make
distributions on Capital Stock);


 


(2)           make any loans or advances to the
Company or any Restricted Subsidiary (it being understood that the
subordination of loans or advances made to the Company or any Restricted
Subsidiary to other Indebtedness Incurred by the Company or any Restricted Subsidiary
shall not be deemed a restriction on the ability to make loans or advances); or


 


(3)           transfer any of its property or
assets to the Company or any Restricted Subsidiary (it being understood that
such transfers shall not include any type of transfer described in clause (1) or
(2) above).


 


(b)                                 Section 6.10(a) of
this First Supplemental Indenture shall not prohibit:


 


59

















 


(1)           any encumbrance or restriction
pursuant to an agreement in effect at or entered into on the Issue Date,
including, without limitation, the Indenture, the Notes and the Senior Credit
Facility (and related documentation) in effect on such date;


 


(2)           any encumbrance or restriction with
respect to a Restricted Subsidiary pursuant to any Capital Stock or agreement
(including an agreement relating to any Capital Stock or Indebtedness) Incurred
by a Restricted Subsidiary on or before the date on which such Restricted
Subsidiary became a Restricted Subsidiary or was merged with or into or consolidated
with or was acquired by the Company or a Restricted Subsidiary (other than
Capital Stock or Indebtedness Incurred as consideration in, or to provide all
or any portion of the funds utilized to consummate, the transaction or series
of related transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by the Company or in contemplation of the
transaction) and outstanding on such date provided, that
any such encumbrance or restriction shall not extend to any assets or property
of the Company or any other Restricted Subsidiary other than the assets and
property so acquired and all improvements, additions and accessions thereto and
products and proceeds thereof, and that, in the case of Indebtedness, was permitted
to be Incurred pursuant to the Indenture;


 


(3)           any encumbrance or restriction with
respect to a Restricted Subsidiary pursuant to an agreement effecting a
refunding, replacement or refinancing, in whole or in part, of Indebtedness
Incurred pursuant to an agreement referred to in clause (1) or
(2) of this Section 6.10(b) or this clause (3) or
contained in any amendment, restatement, modification, renewal, supplement,
refunding, replacement or refinancing of an agreement referred to in clause (1) or
(2) of this Section 6.10(b) or this clause (3);
provided, however, that the encumbrances
and restrictions with respect to such Restricted Subsidiary contained in any
such agreement are not materially less favorable, taken as a whole, to the
Holders of the Notes than the encumbrances and restrictions contained in such
agreements referred to in clauses (1) or (2) of
this Section 6.10(b) on the Issue Date or the date such
Restricted Subsidiary became a Restricted Subsidiary or was merged into a
Restricted Subsidiary, whichever is applicable;


 


(4)           in the case of clause (3) of
Section 6.10(a) of this First Supplemental Indenture,
encumbrances and restrictions in agreements governing Liens permitted to be
incurred under the provisions of Section 6.09 of this First Supplemental
Indenture;


 


(5)           (i) purchase money obligations
for property acquired in the ordinary course of business and (ii) Capitalized
Lease Obligations permitted under the Indenture, in each case, that impose
encumbrances or restrictions of the nature described in clause(3) of
Section 6.10(a) of this First Supplemental Indenture on the
property so acquired;


 


(6)           any restriction with respect to a
Restricted Subsidiary (or any of its property or assets) imposed pursuant to an
agreement entered into for the direct or indirect sale or disposition of the
Capital Stock or assets of such Restricted Subsidiary (or the property or
assets that are subject to such restriction) pending the closing of such sale
or disposition;


 


60

















 


(7)           any customary encumbrances or
restrictions imposed pursuant to any agreement constituting a Permitted
Business Investment;


 


(8)           restrictions on cash or other
deposits and net worth provisions in leases and other agreements entered into
by the Company or any Restricted Subsidiary in the ordinary course of business;


 


(9)           encumbrances or restrictions arising
or existing by reason of applicable law or any applicable rule, regulation or
order;


 


(10)         encumbrances or restrictions contained
in Credit Facilities, indentures, other debt agreements and Hedging Obligations
Incurred by the Company or any Restricted Subsidiary or Preferred Stock issued
by Restricted Subsidiaries subsequent to the Issue Date and permitted pursuant
to Section 6.06 of this First Supplemental Indenture; provided that such encumbrances and restrictions contained
in any such agreement or instrument shall not materially affect the Company’s
ability to make anticipated principal or interest payments on the Notes (as
determined by the Board of Directors of the Company);


 


(11)         customary supermajority voting
provisions and other similar provisions contained in corporate charters,
bylaws, stockholders’ agreements, limited liability company agreements,
partnership agreements, joint venture agreements and other similar agreements;


 


(12)         encumbrances and restrictions contained
in contracts entered into in the ordinary course of business, not relating to
any Indebtedness, and that do not, individually or in the aggregate, detract
from the value of property or assets of the Company or any Restricted
Subsidiary or the ability of the Company or such Restricted Subsidiary to
realize such value, or to make any distributions relating to such property or
assets in each case in any material respect; and


 


(13)         restrictions on the transfer of
property or assets required by any regulatory authority having jurisdiction
over the Company or any Restricted Subsidiary or any of their businesses.


 


SECTION 6.11              Limitation
on Sales of Assets and Subsidiary Stock


 


(a)                                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, make any Asset Disposition unless:


 


(1)           the Company or such Restricted
Subsidiary, as the case may be, receives consideration at least equal to the
fair market value (such fair market value to be determined on the date of
contractually agreeing to such Asset Disposition), as determined in good faith
by the Board of Directors (including as to the value of all non-cash
consideration), of the shares and assets subject to such Asset Disposition;


 


61

















 


(2)                                  at least 75% of the consideration from such Asset Disposition
received by the Company or such Restricted Subsidiary, as the case may be, is
in the form of cash or Cash Equivalents; and


 


(3)                                  an amount equal to 100% of the Net Available Cash from such
Asset Disposition is applied by the Company or such Restricted Subsidiary, as
the case may be:


 


(A)          to the extent the Company or any
Restricted Subsidiary, as the case may be, elects or is required to do so, to
prepay, repay, redeem, defease or purchase Indebtedness of the Company or a
Restricted Subsidiary (other than Capital Stock, Disqualified Stock,
Subordinated Obligations, Guarantor Subordinated Obligations or Indebtedness
owed to the Company or an Affiliate of the Company) within 330 days from the
later of the date of such Asset Disposition or the receipt of such Net
Available Cash; provided, however, that, in
connection with any prepayment, repayment, redemption, defeasance or purchase
of Indebtedness pursuant to this clause (3)(A), the Company or such
Restricted Subsidiary shall retire such Indebtedness and shall cause the
related commitment (if any) to be permanently reduced in an amount equal to the
principal amount so prepaid, repaid, redeemed, defeased or purchased; and


 


(B)           to the extent the Company or such
Restricted Subsidiary elects, to invest in Additional Assets within 330 days
from the later of the date of such Asset Disposition or the receipt of such Net
Available Cash;


 


provided that pending the final application of any such Net
Available Cash in accordance with clause (3)(A) or clause (3)(B) of
this Section 6.11(a), the Company and its Restricted Subsidiaries
may temporarily reduce Indebtedness or otherwise invest such Net Available Cash
in any manner not prohibited by the Indenture.


 


Any Net Available Cash from
Asset Dispositions that is not applied or invested as provided in the preceding
paragraph shall be deemed to constitute “Excess Proceeds.” On the 331st day after
an Asset Disposition, if the aggregate amount of Excess Proceeds exceeds $20.0
million, the Company shall be required to (and may, in satisfaction of such
requirement, at any time prior to such day) make an offer (an “Asset Disposition Offer”) to all Holders
of Notes and to the extent required by the terms of other Pari Passu
Indebtedness, to all Holders of other Pari Passu Indebtedness outstanding with
similar provisions requiring the Company to make an offer to purchase such Pari
Passu Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Notes”), to purchase the
maximum principal amount of Notes and any such Pari Passu Notes to which the
Asset Disposition Offer applies that may be purchased out of the Excess
Proceeds, at an offer price in cash in an amount equal to 100% of the principal
amount of the Notes and Pari Passu Notes plus accrued and unpaid interest to
the date of purchase, in accordance with the procedures set forth in the
Indenture or the agreements governing the Pari Passu Notes, as applicable, in
each case in denominations of $2,000 and larger integral multiples of $1,000.
To the extent that the aggregate amount of Notes and Pari Passu Notes so
validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer
is less than the Excess Proceeds, the Company may use any remaining Excess
Proceeds for general corporate


 


62

















 


purposes,
subject to other covenants contained in the Indenture. If the aggregate
principal amount of Notes surrendered by Holders thereof and other Pari Passu
Notes surrendered by Holders or lenders, collectively, exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and Pari Passu Notes to be
purchased on a pro rata basis on the basis of the aggregate principal amount of
tendered Notes and Pari Passu Notes. Upon completion of such Asset Disposition
Offer, the amount of Excess Proceeds shall be reset at zero.


 


(b)           The Asset
Disposition Offer shall remain open for a period of 20 Business Days following
its commencement, except to the extent that a longer period is required by
applicable law (the “Asset Disposition Offer
Period”). No later than five Business Days after the termination
of the Asset Disposition Offer Period (the “Asset
Disposition Purchase Date”), the Company shall purchase the
principal amount of Notes and Pari Passu Notes required to be purchased
pursuant to this Section 6.11 (the “Asset
Disposition Offer Amount”) or, if less than the Asset
Disposition Offer Amount has been so validly tendered, all Notes and Pari Passu
Notes validly tendered in response to the Asset Disposition Offer.


 


If the Asset Disposition
Purchase Date is on or after a Regular Record Date and on or before the related
Interest Payment Date, any accrued and unpaid interest shall be paid to the
Person in whose name a Note is registered at the close of business on such
Regular Record Date, and no additional interest shall be payable to Holders who
tender Notes pursuant to the Asset Disposition Offer.


 


On or before the Asset
Disposition Purchase Date, the Company shall, to the extent lawful, accept for
payment, on a pro rata basis to the extent necessary, the Asset Disposition
Offer Amount of Notes and Pari Passu Notes or portions of Notes and Pari Passu
Notes so validly tendered and not properly withdrawn pursuant to the Asset
Disposition Offer, or if less than the Asset Disposition Offer Amount has been
validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so
validly tendered and not properly withdrawn, in each case in integral multiples
of $1,000. The Company shall deliver to the Trustee an Officers’ Certificate
stating that such Notes or portions thereof were accepted for payment by the
Company in accordance with the terms of this Section 6.11 and, in
addition, the Company shall deliver all certificates and notes required, if
any, by the agreements governing the Pari Passu Notes. The Company or the
Paying Agent, as the case may be, shall promptly (but in any case not later
than five Business Days after the termination of the Asset Disposition Offer
Period) mail or deliver to each tendering Holder of Notes or Holder or lender
of Pari Passu Notes, as the case may be, an amount equal to the purchase price
of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn
by such Holder or lender, as the case may be, and accepted by the Company for
purchase, and the Company shall promptly issue a new Note, and the Trustee,
upon delivery of an Officers’ Certificate from the Company, shall authenticate
and mail or deliver such new Note to such Holder, in a principal amount equal
to any unpurchased portion of the Note surrendered; provided
that each such new Note shall be in a principal amount of $2,000 or a larger
integral multiple of $1,000. In addition, the Company shall take any and all
other actions required by the agreements governing the Pari Passu Notes. Any
Note not so accepted shall be promptly mailed or delivered by the Company to
the Holder thereof. The Company shall publicly announce the results of the
Asset Disposition Offer on the Asset Disposition Purchase Date.


 


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(c)                                  For the purposes of clause (2) of Section 6.11(a) of
this First Supplemental Indenture only, the following shall be deemed to be
cash:


 


(1)           the release of the Company and its
Restricted Subsidiaries from all liability on Indebtedness (other than
Subordinated Obligations or Disqualified Stock) of the Company or Indebtedness
of a Restricted Subsidiary (other than Guarantor Subordinated Obligations or
Disqualified Stock of any Subsidiary Guarantor) in connection with such Asset
Disposition, whether by assumption and release, satisfaction and discharge, or
otherwise (in which case the Company shall, without further action, be deemed
to have applied such deemed cash to Indebtedness in accordance with clause (3)(A) of
Section 6.11(a) of this First Supplemental Indenture); and


 


(2)           securities, notes or other
obligations received by the Company or any Restricted Subsidiary from the
transferee that are promptly converted by the Company or such Restricted
Subsidiary into cash or Cash Equivalents.


 


(d)                                 The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any Asset Swaps, unless:


 


(1)           at the time of entering into such
Asset Swap and immediately after giving effect to such Asset Swap, no Default
or Event of Default shall have occurred and be continuing or would occur as a
consequence thereof;


 


(2)           in the event such Asset Swap involves
the transfer by the Company or any Restricted Subsidiary of assets having an
aggregate fair market value, as determined by the Board of Directors of the
Company in good faith, in excess of $10.0 million, the terms of such Asset Swap
have been approved by a majority of the members of the Board of Directors of
the Company; and


 


(3)           in the event such Asset Swap involves
the transfer by the Company or any Restricted Subsidiary of assets having an
aggregate fair market value, as determined by the Board of Directors of the
Company in good faith, in excess of $25.0 million, the terms of such Asset Swap
have been approved by a majority of the independent members of the Board of
Directors of the Company.


 


(e)                                  The Company shall comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Notes pursuant to this
Section 6.11. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Section 6.11,
the Company shall comply with the applicable securities laws and regulations
and shall not be deemed to have breached its obligations under the Indenture by
virtue of any conflict.


 


SECTION 6.12              Limitation
on Affiliate Transactions


 


(a)                                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or conduct any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of the Company (an “Affiliate Transaction”) unless:


 


64

















 


(1)           the terms of such Affiliate
Transaction are no less favorable to the Company or such Restricted Subsidiary,
as the case may be, than those that could be obtained in a comparable
transaction at the time of such transaction in arm’s-length dealings with a
Person who is not such an Affiliate;


 


(2)           in the event such Affiliate
Transaction involves an aggregate consideration in excess of $10.0 million, the
terms of such transaction have been approved by a majority of the members of
the Board of Directors of the Company and by a majority of the members of such
Board having no personal stake in such transaction, if any (and such majority
or majorities, as the case may be, determines that such Affiliate Transaction
satisfies the criteria in clause (1) of this Section 6.12(a));
and


 


(3)           in the event such Affiliate
Transaction involves an aggregate consideration in excess of $25.0 million, the
Company has received a written opinion from an independent investment banking,
accounting or appraisal firm of nationally recognized standing that such
Affiliate Transaction is fair to the Company or not materially less favorable
than those that might reasonably have been obtained in a comparable transaction
at such time on an arm’s-length basis from a Person that is not an Affiliate.


 


(b)                                 Section 6.12(a) of
this First Supplemental Indenture shall not apply to:


 


(1)           any Restricted Payment (other than a Restricted
Investment) and Permitted Investments (other than pursuant to clauses (1),
(2), (11), (13) and (14) of the definition of “Permitted
Investments”) permitted to be made pursuant to the Indenture;


 


(2)           any issuance of securities, or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements and other compensation arrangements, options
to purchase Capital Stock of the Company, restricted stock plans, long-term
incentive plans, stock appreciation rights plans, participation plans or
similar employee benefits plans and/or indemnity provided on behalf of
officers, directors and employees approved by the Board of Directors of the
Company;


 


(3)           the payment of customary fees paid
to, and indemnity provided on behalf of, directors of the Company or any
Restricted Subsidiary;


 


(4)           loans or advances to employees,
officers or directors of the Company or any Restricted Subsidiary in the
ordinary course of business in an aggregate amount not in excess of $2.0
million with respect to all loans or advances made since the Issue Date
(without giving effect to the forgiveness of any such loan); provided, however, that the Company and its Subsidiaries
shall comply in all material respects with the provisions of the Sarbanes Oxley
Act of 2002 and the rules and regulations promulgated in connection
therewith relating to the provision of any such loans and advances as if the
Company had filed a registration statement with the Commission;


 


(5)           any transaction between the Company
and a Restricted Subsidiary or between Restricted Subsidiaries and Guarantees
issued by the Company or a Restricted


 


65

















 


Subsidiary for the benefit of the
Company or a Restricted Subsidiary, as the case may be, in accordance with Section 6.06
of this First Supplemental Indenture;


 


(6)           the existence of, and the performance
of obligations of the Company or any of its Restricted Subsidiaries under the
terms of any agreement to which the Company or any of its Restricted
Subsidiaries is a party as of or on the Issue Date and identified on Schedule 1
hereto, as these agreements may be amended, modified, supplemented, extended or
renewed from time to time; provided, however,
that any future amendment, modification, supplement, extension or renewal
entered into after the Issue Date shall be permitted to the extent that its
terms, taken as a whole, are not materially more disadvantageous to the Holders
of the Notes than the terms of the agreements in effect on the Issue Date;


 


(7)           transactions with customers, clients,
suppliers or purchasers or sellers of goods or services, including Eagle Creek
Mining & Drilling, Inc., in each case in the ordinary course of
the business of the Company and its Restricted Subsidiaries and otherwise in
compliance with the terms of the Indenture; provided that
in the reasonable determination of the members of the Board of Directors or
senior management of the Company, such transactions are on terms that are no
less favorable to the Company or the relevant Restricted Subsidiary than those
that would have been obtained in a comparable transaction by the Company or
such Restricted Subsidiary with an unrelated Person; and


 


(8)           any issuance or sale of Capital Stock
(other than Disqualified Stock) to Affiliates of the Company and the granting
of registration and other customary rights in connection therewith.


 


SECTION 6.13              Limitation
on Sale of Capital Stock of Restricted Subsidiaries


 


The Company shall not, and
shall not permit any Restricted Subsidiary to, transfer, convey, sell, lease or
otherwise dispose of any Voting Stock of any Restricted Subsidiary or, with
respect to a Restricted Subsidiary, to issue any of the Voting Stock of a
Restricted Subsidiary (other than, if necessary, shares of its Voting Stock
constituting Foreign Required Minority Shares) to any Person except:


 


(1)           to the Company or a Wholly Owned
Subsidiary;


 


(2)           the granting of Liens permitted under
Section 6.09 of this First Supplemental Indenture; and


 


(3)           in compliance with Section 6.11
of this First Supplemental Indenture and immediately after giving effect to
such issuance or sale, such Restricted Subsidiary would continue to be a
Restricted Subsidiary.


 


Notwithstanding the
preceding paragraph, the Company and its Restricted Subsidiaries may sell all
the Voting Stock of a Restricted Subsidiary as long as the Company or its
Restricted Subsidiaries comply with the terms of Section 6.11 of
this First Supplemental Indenture.


 


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SECTION 6.14              Change
of Control


 


If a Change of Control
occurs, unless the Company has exercised its right to redeem all of the Notes
pursuant to Section 7.05 of this First Supplemental Indenture, each
Holder of Notes shall have the right to require the Company to repurchase all
or any part (equal to $2,000 or larger integral multiples of $1,000) of such
Holder’s Notes at a purchase price in cash equal to 101% of the principal
amount of the Notes plus accrued and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of record on the relevant record date
to receive interest due on the relevant Interest Payment Date).


 


Within 30 days following any
Change of Control, unless the Company has given irrevocable notice that it shall
exercise its right to redeem all of the Notes pursuant to Section 7.05
of this First Supplemental Indenture, the Company shall mail a notice (the “Change of Control Offer”) to each
Holder, with a copy to the Trustee, stating:


 


(1)           that a Change of Control has occurred
and that such Holder has the right to require the Company to purchase such
Holder’s Notes at a purchase price in cash equal to 101% of the principal
amount of such Notes plus accrued and unpaid interest, if any, to the date of
purchase (subject to the right of Holders of record on a record date to receive
interest on the relevant interest payment date) (the “Change
of Control Payment”);


 


(2)           the repurchase date (which shall be
no earlier than 30 days nor later than 60 days from the date such notice is
mailed) (the “Change of Control Payment Date”);
and


 


(3)           the procedures determined by the
Company, consistent with the Indenture, that a Holder must follow in order to
have its Notes repurchased.


 


On the Change of Control
Payment Date, the Company shall, to the extent lawful:


 


(1)           accept for payment all Notes or portions of Notes (of
$2,000 or larger integral multiples of $1,000) properly tendered pursuant to
the Change of Control Offer;


 


(2)           deposit with the Paying Agent an amount equal to the Change
of Control Payment in respect of all Notes or portions of Notes so tendered;
and


 


(3)           deliver or cause to be delivered to the Trustee any
definitive Notes so 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 shall
promptly mail (or cause to be transferred by book entry) to each Holder of
Notes so tendered the Change of Control Payment for such Notes, and the Trustee
shall promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; provided that
each such new Note shall be in a principal amount of $2,000 or larger integral
multiples of $1,000.


 


67
















 


If the Change of Control
Payment Date is on or after a Regular Record Date and on or before the related
Interest Payment Date, any accrued and unpaid interest, if any, shall be paid
on the relevant Interest Payment Date to the Person in whose name a Note is
registered at the close of business on such Regular Record Date, and no
additional interest shall be payable to Holders who tender pursuant to the
Change of Control Offer.


 


The Company shall not be
required to make a Change of Control Offer following a Change of Control if a
third party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in the Indenture
applicable to a Change of Control Offer made by the Company and purchases all
Notes validly tendered and not withdrawn under such Change of Control Offer.


 


The Company shall comply, to
the extent applicable, with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws or regulations in connection with
the repurchase of Notes pursuant to this Section 6.14. To the
extent that the provisions of any securities laws or regulations conflict with
provisions of the Indenture, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached this Section 6.14
by virtue of the conflict.


 


SECTION 6.15              Commission
Reports


 


Notwithstanding that the
Company may not be subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, to the extent permitted by the Exchange Act,
the Company shall file with the Commission, and make available to the Trustee
and the registered Holders of the Notes, the annual reports and the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may by rules and regulations prescribe)
that are specified in Sections 13 and 15(d) of the Exchange Act with
respect to U.S. issuers, in each case not later than 60 days after the final
due dates therefor specified therein or in the relevant forms (after giving
effect to any cure period specified therein). For the avoidance of doubt, no
Default shall be deemed to occur under the Indenture with respect to the Notes
until the expiration of such 60-day period.


 


In the event that the
Company is not permitted to file such reports, documents and information with
the Commission pursuant to the Exchange Act, the Company shall nevertheless
make available such Exchange Act information to the Trustee and the Holders of
the Notes as if the Company were subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, in each case not later than 60 days after
the final due dates therefor specified therein or in the relevant forms (after
giving effect to any cure period specified therein). For the avoidance of
doubt, no Default shall be deemed to occur under the Indenture with respect to
the Notes until the expiration of such 60-day period.


 


If the Company has
designated any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly
and annual financial information required by this Section 6.15
shall include a reasonably detailed presentation, either on the face of the
financial statements or in the footnotes to the financial statements and in
Management’s Discussion and Analysis of Results of Operations and Financial
Condition, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries.


 


68

















 


In the event that any direct
or indirect parent company of the Company becomes a guarantor of the Notes, the
Company may satisfy its obligations under this Section 6.15 by
furnishing financial information relating to such parent; provided
that (a) such financial statements are accompanied by consolidating
financial information for such parent, the Company, the Subsidiary Guarantors
and the Subsidiaries of the Company that are not Subsidiary Guarantors in the
manner prescribed by the Commission and (b) such parent is not engaged in
any business in any material respect other than incidental to its ownership,
directly or indirectly, of the Capital Stock of the Company.


 


Pursuant to Section 3.02(5)(a) of
this First Supplemental Indenture, a Default under this Section 6.15
is subject to a 180-day cure period. During such cure period, the interest rate
on the Notes shall increase by the Additional Interest.


 


SECTION 6.16              Future
Subsidiary Guarantors


 


After the Issue Date, the
Company shall cause each Restricted Subsidiary (other than a Foreign
Subsidiary) that Guarantees any Indebtedness of the Company or any Subsidiary
Guarantor to execute and deliver to the Trustee a Subsidiary Guarantee pursuant
to which such Subsidiary Guarantor shall unconditionally Guarantee, on a joint
and several basis, the full and prompt payment of the principal of, premium, if
any and interest on the Notes.


 


SECTION 6.17              Limitation
on Lines of Business


 


The Company shall not, and
shall not permit any Restricted Subsidiary to, engage in any business as a
primary line of business other than a Related Business.


 


ARTICLE SEVEN

REDEMPTION OF NOTES


 


SECTION 7.01              Original
Indenture


 


Sections 1103, 1106 and 1108
of the Original Indenture shall not apply to the Notes; and, insofar as
relating to the Notes, any reference in the Original Indenture to Sections
1103, 1106 or 1108 thereof shall be deemed to refer to Sections 7.02,
7.03 or 7.04, respectively, of this First Supplemental Indenture.


 


SECTION 7.02              Selection
by Trustee of Notes to Be Redeemed


 


If less than all the Notes
are to be redeemed at any time pursuant to an optional redemption, the
particular Notes to be redeemed shall be selected not more than 60 days prior
to the Redemption Date by the Trustee, from the outstanding Notes not
previously called for redemption, in compliance with the requirements of the
principal national securities exchange, if any, on which such Notes are listed,
or, if such Notes are not so listed, on a pro rata basis, by lot or by such
other method as the Trustee in its sole discretion shall deem fair and appropriate
(and in such manner as complies with applicable legal requirements) and which
may provide for the selection for redemption of portions of the principal of
the Notes; provided, however, that no such partial
redemption shall reduce the portion of the principal amount of a Note not
redeemed to less than $2,000.


 


69

















 


The Trustee shall promptly
notify the Company in writing of the Notes selected for redemption as aforesaid
and, in case of any Notes selected for partial redemption as aforesaid, the
principal amount thereof to be redeemed.


 


For all purposes of the
Indenture, unless the context otherwise requires, all provisions relating to
the redemption of Notes shall relate, in the case of any Notes redeemed or to
be redeemed only in part, to the portion of the principal amount of such Notes
which has been or is to be redeemed. If the Company shall so direct, Notes
registered in the name of the Company, any Affiliate or any Subsidiary thereof
shall not be included in the Notes selected for redemption.


 


SECTION 7.03              Notes
Payable on Redemption Date


 


Notice of redemption having
been given as aforesaid, the Notes so to be redeemed shall, on the Redemption
Date, become due and payable at the Redemption Price therein specified, and
from and after such date (unless the Company shall default in the payment of
the Redemption Price and accrued interest) such Notes shall cease to bear
interest. Upon surrender of any such Note for redemption in accordance with
said notice, such Note shall be paid by the Company at the Redemption Price,
together with accrued interest to (but excluding) the Redemption Date; provided, however, that, if the Redemption Date is on or
after a Regular Record Date and on or before the related Interest Payment Date,
the accrued and unpaid interest, if any, shall be paid to the Person in whose
name the Note is registered at the close of business on such Regular Record
Date, and no additional interest shall be payable to Holders whose Notes shall
be subject to redemption by the Company.


 


If any Note called for
redemption shall not be so paid upon surrender thereof for redemption, the
principal and any premium shall, until paid, bear interest from the Redemption
Date at the rate prescribed therefor in the Note.


 


SECTION 7.04              Other
Mandatory Redemption


 


The Company is not required
to make mandatory redemption or sinking fund payments with respect to the
Notes. Under certain circumstances, the Company may be required to offer to
purchase Notes as described under Sections 6.11 and 6.14.
The Company may, at any time and from time to time, purchase Notes in the open
market or otherwise.


 


SECTION 7.05              Optional
Redemption


 


(a)           Except as
described in subsection (b) below, the Notes are not
redeemable at the option of the Company prior to maturity.


 


(b)           The Notes
may be redeemed, in whole or in part, at any time at the option of the Company
upon not less than 30 nor more than 60 days’ prior notice mailed by first-class
mail to each Holder of Notes at its registered address, at a Redemption Price
equal to 100% of the principal amount of the Notes redeemed plus the Applicable
Premium plus accrued and unpaid interest, if any, to the Redemption Date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on the relevant Interest Payment Date).


 


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ARTICLE EIGHT

DEFEASANCE AND COVENANT DEFEASANCE

WITH RESPECT TO THE NOTES


 


SECTION 8.01              Original
Indenture


 


Article Twelve of the
Original Indenture shall not apply to the Notes.


 


SECTION 8.02              Discharge
of Liability on Notes; Defeasance


 


(a)           Subject to
Sections 8.02(b) and 8.03 of this First Supplemental
Indenture, the Company at any time may terminate (i) all its obligations
under the Notes and the Indenture and all obligations of the Subsidiary
Guarantors under the Subsidiary Guarantees and the Indenture (“legal defeasance”), and after giving
effect to such legal defeasance, any omission to comply with such obligations
shall no longer constitute a Default or Event of Default or (ii) its
obligations under clause (3) of Section 4.02 of
this First Supplemental Indenture and Sections 6.06, 6.08, 6.09,
6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16
or 6.17 of this First Supplemental Indenture and Section 1006 of
the Original Indenture and the Company may omit to comply with and shall have
no liability in respect of any term, condition or limitation set forth in any
such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply with such covenants shall no longer constitute a Default or
an Event of Default under clauses (3), (4) and (5) of
Section 3.02 of this First Supplemental Indenture and the operation
of clauses (6), (7) (but only with respect to a
Significant Subsidiary or group of Restricted Subsidiaries that would
constitute a Significant Subsidiary), (8) and (9) of Section 3.02
of this First Supplemental Indenture, and the events specified in such Sections
shall no longer constitute an Event of Default (clause (ii) being
referred to as the “covenant defeasance”), but
except as specified above, the remainder of the Indenture and the Notes shall
be unaffected thereby. The Company may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option.


 


If the Company exercises its
legal defeasance option, payment of the Notes may not be accelerated because of
an Event of Default with respect to the Notes, and the Subsidiary Guarantees in
effect at such time shall terminate. If the Company exercises its covenant
defeasance option, payment of the Notes may not be accelerated because of an
Event of Default specified in clauses (3) (as such clause relates to Section 4.02(3)),
(4) (as such clause relates to Sections 6.06, 6.08,
6.09, 6.10, 6.11, 6.12, 6.13, 6.14, 6.16
or 6.17 of this First Supplemental Indenture), (5), (6), (7) (but
only with respect to a Significant Subsidiary or group of Restricted
Subsidiaries that would constitute a Significant Subsidiary), (8) and
(9) of Section 3.02 of this First Supplemental
Indenture.


 


Upon satisfaction of the
conditions set forth herein and upon request of the Company, the Trustee shall
acknowledge in writing the discharge of those obligations that the Company
terminates.


 


(b)           Notwithstanding
the provisions of Article Four of the Original Indenture and Section 8.02(a) of
this First Supplemental Indenture, following legal defeasance the Company’s


 


71

















 


obligations in Sections 304, 305, 306, 309, 607, 608, 1001
(to the extent of the legal defeasance trust), 1002 and 1003 of the Original
Indenture and Sections 6.03,  6.04 and 6.07 and Article Eight
of this First Supplemental Indenture shall survive until the Notes have been
paid in full. Thereafter, the Company’s obligations in Sections 607 of the
Original Indenture and Sections 8.04, 8.06 and 8.07
of this First Supplemental Indenture shall survive.


 


SECTION 8.03              Conditions
to Defeasance


 


The Company may exercise its
legal defeasance option or its covenant defeasance option only if:


 


(a)           the
Company irrevocably deposits in trust with the Trustee for the benefit of the
Holders money in U.S. dollars or U.S. Government Obligations or a combination
thereof for the payment of principal, premium, if any, and interest on the
Notes to maturity or redemption, as the case may be;


 


(b)           the
Company delivers to the Trustee a certificate from a nationally recognized firm
of independent accountants expressing their opinion (or if nationally
recognized independent accounting firms no longer routinely express such
opinions, a certificate from the chief financial officer of the Company
expressing his or her opinion) that the payments of principal and interest when
due and without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment shall provide cash at such times and in
such amounts as shall be sufficient to pay principal, premium, if any, and
interest when due on all the Notes to maturity;


 


(c)           no Default
or Event of Default shall have occurred and be continuing on the date of such
deposit (other than Defaults and Events of Default arising out of the
incurrence of Indebtedness used to fund such deposit) or, with respect to the
Company under clause (7) of Section 3.02 of this
First Supplemental Indenture, on the 123rd day after such date of deposit;


 


(d)           such legal
defeasance or covenant defeasance shall not result in a breach or violation of,
or constitute a Default under, the Indenture or any other material agreement or
instrument to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound;


 


(e)           the
Company shall have delivered to the Trustee an Opinion of Counsel (subject to
customary assumptions and exclusions) to the effect that, assuming no
intervening bankruptcy of the Company between the date of deposit and the 123rd
day following the deposit and that no Holder of the Notes is an insider of the
Company within the meaning of the Bankruptcy Law, after the 123rd day following
the deposit, the trust funds shall not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ right generally;


 


(f)            the
Company delivers to the Trustee an Opinion of Counsel (subject to customary
assumptions and exclusions) to the effect that the trust resulting from the
deposit does not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;


 


72

















 


(g)           in the
case of legal defeasance, the Company shall have delivered to the Trustee an
Opinion of Counsel (subject to customary assumptions and exclusions) in the
United States stating that (i) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling, or (ii) since
the date of this First Supplemental Indenture there has been a change in the
applicable Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders shall not
recognize income, gain or loss for Federal income tax purposes as a result of
such defeasance and shall be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if such
legal defeasance had not occurred;


 


(h)           in the
case of covenant defeasance, the Company shall have delivered to the Trustee an
Opinion of Counsel (subject to customary assumptions and exclusions) in the
United States to the effect that the Holders shall not recognize income, gain
or loss for Federal income tax purposes as a result of such deposit and
covenant defeasance and shall be subject to Federal income tax on the same
amount, in the same manner and at the same times as would have been the case if
such deposit and covenant defeasance had not occurred; and


 


(i)            the
Company delivers to the Trustee an Officers’ Certificate and an Opinion of
Counsel, together stating that all conditions precedent to the defeasance and
discharge of the Notes and the Indenture as contemplated by this Article Eight
have been complied with.


 


SECTION 8.04              Application
of Trust Money


 


The Trustee shall hold in
trust money or U.S. Government Obligations deposited with it pursuant to this Article Eight.
It shall apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with the Indenture to
the payment of principal of and interest on the Notes.


 


SECTION 8.05              Repayment
to Company


 


The Trustee and the Paying
Agent shall promptly turn over to the Company upon request any excess money,
U.S. Government Obligations or securities held by them upon payment of all the
obligations under the Indenture.


 


Subject to any applicable
abandoned property law, the Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment of principal of or
interest on the Notes that remains unclaimed for two years, and, thereafter,
Holders entitled to the money must look to the Company for payment as general
creditors.


 


SECTION 8.06              Indemnity
for U.S. Government Obligations


 


The Company shall pay and
shall indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against deposited U.S. Government Obligations or the principal and
interest received on such U.S. Government Obligations.


 


73

















 


SECTION 8.07              Reinstatement


 


If the Trustee or Paying
Agent is unable to apply any money or U.S. Government Obligations in accordance
with this Article Eight by reason of any legal proceeding or by
reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the
obligations of the Company and the Subsidiary Guarantors under the Indenture
and the Notes shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Eight until such time as the Trustee or
Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article Eight; provided, however, that, if the Company has made any payment
of interest on or principal of any Notes because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.


 


ARTICLE NINE

SUBSIDIARY GUARANTEE


 


SECTION 9.01              Subsidiary
Guarantee


 


Each Subsidiary Guarantor
hereby fully, unconditionally and irrevocably guarantees, as primary obligor
and not merely as surety, jointly and severally with each other Subsidiary
Guarantor, to each Holder of the Notes and the Trustee the full and punctual
payment when due, whether at maturity, by acceleration, by redemption or
otherwise, of the principal of, premium, if any, and interest on the Notes and
all other monetary obligations of the Company under the Indenture (all the
foregoing being hereinafter collectively called the “Obligations”).
Each Subsidiary Guarantor further agrees (to the extent permitted by law) that
the Obligations may be extended or renewed, in whole or in part, without notice
or further assent from it, and that it shall remain bound under this Article Nine
notwithstanding any extension or renewal of any Obligation.


 


Each Subsidiary Guarantor
waives presentation to, demand of payment from and protest to the Company of
any of the Obligations and also waives notice of protest for nonpayment. Each
Subsidiary Guarantor waives notice of any default under the Notes or the
Obligations. The obligations of each Subsidiary Guarantor hereunder shall not
be affected by (a) the failure of any Holder to assert any claim or demand
or to enforce any right or remedy against the Company or any other Person under
the Indenture, the Notes or any other agreement or otherwise; (b) any
extension or renewal of any thereof; (c) any rescission, waiver, amendment
or modification of any of the terms or provisions of the Indenture, the Notes
or any other agreement; (d) the release of any security held by any Holder
or the Trustee for the Obligations or any of them; (e) the failure of any
Holder to exercise any right or remedy against any other Subsidiary Guarantor;
or (f) any change in the ownership of the Company.


 


Each Subsidiary Guarantor
further agrees that its Subsidiary Guarantee herein constitutes a Guarantee of
payment when due (and not a Guarantee of collection) and waives any right to
require that any resort be had by any Holder to any security held for payment
of the Obligations.


 


74

















 


Except as expressly set
forth in Sections 8.02(a), 9.02 and 9.03 of this
First Supplemental Indenture, the obligations of each Subsidiary Guarantor
hereunder shall not be subject to any reduction, limitation, impairment or
termination for any reason (other than payment of the Obligations in full),
including any claim of waiver, release, surrender, alteration or compromise,
and shall not be subject to any defense of setoff, counterclaim, recoupment or
termination whatsoever or by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each Subsidiary Guarantor
herein shall not be discharged or impaired or otherwise affected by the failure
of any Holder to assert any claim or demand or to enforce any remedy under the
Indenture, the Notes or any other agreement, by any waiver or modification of
any thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of any Subsidiary Guarantor or would otherwise operate as
a discharge of such Subsidiary Guarantor as a matter of law or equity.


 


Each Subsidiary Guarantor
further agrees that its Subsidiary Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any of the Obligations is
rescinded or must otherwise be restored by any Holder upon the bankruptcy or
reorganization of the Company or otherwise.


 


In furtherance of the
foregoing and not in limitation of any other right which any Holder has at law
or in equity against any Subsidiary Guarantor by virtue hereof, upon the
failure of the Company to pay any of the Obligations when and as the same shall
become due, whether at maturity, by acceleration, by redemption or otherwise,
each Subsidiary Guarantor hereby promises to and shall, upon receipt of written
demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the
Holders an amount equal to the sum of (i) the unpaid amount of such
Obligations then due and owing and (ii) accrued and unpaid interest on
such Obligations then due and owing (but only to the extent not prohibited by
law) and except as provided in Section 9.03 of this First
Supplemental Indenture.


 


Each Subsidiary Guarantor
further agrees that, as between such Subsidiary Guarantor, on the one hand, and
the Holders, on the other hand, (x) the maturity of the Obligations
guaranteed hereby may be accelerated as provided in the Indenture for the
purposes of its Subsidiary Guarantee herein, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Obligations guaranteed hereby and (y) in the event of any such declaration
of acceleration of such Obligations, such Obligations (whether or not due and
payable) shall forthwith become due and payable by the Subsidiary Guarantor for
the purposes of this Subsidiary Guarantee.


 


Each Subsidiary Guarantor
also agrees to pay any and all reasonable costs and expenses (including
reasonable attorneys’ fees) incurred by the Trustee or the Holders in enforcing
any rights under this Section 9.01.


 


SECTION 9.02              Termination,
Release and Discharge


 


(a)           Subject to
Section 6.11 and Article Four of this First
Supplemental Indenture, each Subsidiary Guarantor may consolidate with or merge
into or sell all or substantially all of its


 


75

















 


property and assets to the Company, another Subsidiary
Guarantor or a Person other than the Company or another Subsidiary Guarantor
(whether or not Affiliated with the Subsidiary Guarantor).


 


(b)                                 Notwithstanding the foregoing and the other provisions of the
Indenture, in the event a Subsidiary Guarantor is sold or disposed of (whether
by merger, consolidation, the sale of its Capital Stock or the sale of all or
substantially all of its assets (other than by lease) and whether or not the
Subsidiary Guarantor is the surviving corporation in such transaction) to a
Person which is not the Company or a Restricted Subsidiary, such Subsidiary
Guarantor shall be released from its obligations under its Subsidiary Guarantee
if:


 


(1)           the sale or other disposition is in
compliance with the Indenture, including Section 6.11 of this First
Supplemental Indenture (it being understood that only such portion of the Net
Available Cash as is required to be applied on or before the date of such
release in accordance with the terms of the Indenture needs to be applied in
accordance therewith at such time), Section 6.13 and Article Four
of this First Supplemental Indenture; and


 


(2)           all the obligations of such
Subsidiary Guarantor under all Indebtedness of the Company and all Subsidiary
Guarantors terminate upon consummation of such transaction.


 


(c)                                  A Subsidiary Guarantor shall be deemed released and relieved
of its obligations under the Indenture and its Subsidiary Guarantee without any
further action required on the part of the Company or such Subsidiary Guarantor
upon the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary
in accordance with the terms of the Indenture or in connection with any legal
defeasance of the Notes or upon satisfaction and discharge of the Indenture,
each in accordance with the provisions of the Indenture.


 


SECTION 9.03              Limitation
of Subsidiary Guarantors’ Liability


 


Each Subsidiary Guarantor,
and by its acceptance hereof each Holder, hereby confirms that it is the
intention of all such parties that the guarantee by such Subsidiary Guarantor
pursuant to its Subsidiary Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Federal Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
state law. To effectuate the foregoing intention, the Holders and each
Subsidiary Guarantor hereby irrevocably agree that the obligations of each
Subsidiary Guarantor shall be limited to the maximum amount as shall, after
giving effect to all other contingent and fixed liabilities of such Subsidiary
Guarantor (including, without limitation, any guarantees under the Senior
Credit Facility) and after giving effect to any collections from or payments
made by or on behalf of any other Subsidiary Guarantor in respect of the
obligations of such other Subsidiary Guarantor under its Subsidiary Guarantee
or pursuant to Section 9.04 of this First Supplemental Indenture,
result in the obligations of such Subsidiary Guarantor under its Subsidiary
Guarantee not constituting a fraudulent conveyance or fraudulent transfer under
Federal or state law. This Section 9.03 is for the benefit of the
creditors of each Subsidiary Guarantor.


 


76

















 


SECTION 9.04              Contribution


 


In order to provide for just
and equitable contribution among the Subsidiary Guarantors, the Subsidiary
Guarantors agree, that in the event any payment or distribution is made by any
Subsidiary Guarantor (a “Funding Guarantor”) under its Subsidiary Guarantee,
such Funding Guarantor shall be entitled to a contribution from each other
Subsidiary Guarantor (if any) in a pro rata amount based on the Adjusted Net
Assets of each Subsidiary Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in
discharging the Company’s obligations with respect to the Notes or any other
Subsidiary Guarantor’s obligations with respect to its Subsidiary Guarantee.


 


ARTICLE TEN

MISCELLANEOUS PROVISIONS WITH RESPECT TO THE NOTES


 


SECTION 10.01            Effect
of Headings and Table of Contents


 


The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.


 


SECTION 10.02            Successors
and Assigns


 


All covenants and agreements
in this First Supplemental Indenture by the Company shall bind its successors
and assigns, whether so expressed or not.


 


SECTION 10.03            Separability
Clause.


 


In case any provision in
this First Supplemental Indenture or in the Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.


 


SECTION 10.04            Governing
Law


 


THE INTERNAL LAW OF THE
STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS FIRST SUPPLEMENTAL
INDENTURE AND THE NOTES.


 


SECTION 10.05            No
Adverse Interpretation of Other Agreements


 


This First Supplemental
Indenture may not be used to interpret any other indenture, loan or debt
agreement of the Company or its Subsidiaries or of any other Person, other than
the Original Indenture. Other than the Original Indenture, no such indenture,
loan or debt agreement may be used to interpret this First Supplemental
Indenture.


 


SECTION 10.06            Counterparts


 


The parties may sign any
number of copies of this First Supplemental Indenture. Each signed copy shall
be an original, but all of them together represent the same agreement.


 


77
















 


SECTION 10.07                                     Notices


 


Section 105(2) of
the Original Indenture is amended by deleting the words “Chief Financial
Officer” therefrom and replacing them with the words “Corporate Secretary”.


 


[Signature page follows]


 


78

















 


IN WITNESS WHEREOF, the
parties hereto have caused this First Supplemental Indenture to be duly
executed, all as of the day and year first above written.


 


	
   

  	
  BERRY PETROLEUM COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ David D. Wolf

  
	
   

  	
  Name: 

  	
  David D. Wolf

  
	
   

  	
  Title:

  	
  Executive Vice President and Chief Financial
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, NATIONAL
  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Maddy Hall

  
	
   

  	
  Name: 

  	
  Maddy Hall

  
	
   

  	
  Title:

  	
  Vice President

  



 


79

















 


EXHIBIT A


 


[FORM OF FACE OF NOTE]


 


[Global Legend and Depository Legend, if
applicable]


 


THIS SECURITY IS BEING
ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL INCOME TAX
PURPOSES.  FOR INFORMATION REGARDING THE
ISSUE PRICE, THE TOTAL AMOUNT OF ORIGINAL ISSUE DISCOUNT, THE ISSUE DATE, AND
THE YIELD TO MATURITY OF THIS SECURITY, PLEASE CONTACT BERRY PETROLEUM
COMPANY, 1999 BROADWAY, SUITE 3700, DENVER COLORADO, ATTENTION: CHIEF FINANCIAL
OFFICER.


 


	
  No. [    ]

  	
   

  	
  Principal Amount
  $[    ]

  
	
   

  	
   

  
	
  CUSIP NO.
  [    ]

  	
   

  



 


BERRY PETROLEUM COMPANY


 


101⁄4% Senior Notes due 2014


 


BERRY PETROLEUM COMPANY, a
Delaware corporation, promises to pay to
[                        ]
or registered assigns, the principal sum of
[                    ]
Dollars or such greater or lesser amount as may be indicated on Schedule A
hereto on June 1, 2014.


 


Interest
Payment Dates:                                              June 1 and
December 1, commencing December 1, 2009


 


Regular
Record Dates:                                                      May 15 and
November 15


 


Additional provisions of
this Note are set forth on the other side of this Note.


 


Date:
[              ]


 


	
   

  	
  BERRY PETROLEUM COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


 


	
  TRUSTEE’S CERTIFICATE OF AUTHENTICATION

  	
   

  	
   

  
	
  WELLS FARGO BANK, NATIONAL ASSOCIATION

  	
   

  	
   

  
	
  as Trustee, certifies that this is one of the
  Securities of the series designated therein referred to in the
  within-mentioned Indenture.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Officer

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


A-1

















 


[FORM OF REVERSE SIDE OF NOTE]


 


101⁄4% Senior Notes due 2014


 


1.                                       Interest


 


BERRY PETROLEUM COMPANY, a
Delaware corporation (such corporation, and its successors and assigns under
the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest
on the principal amount of this Note at the rate per annum shown above.


 


The Company will pay
interest semiannually on June 1 and December 1 of each year,
commencing December 1, 2009. Interest on this Note will accrue from the
most recent date to which interest has been paid on this Note or, if no
interest has been paid, from May 27, 2009. The Company shall pay interest
on overdue principal or premium, if any (plus interest on such interest to the
extent lawful), at the rate borne by the Notes to the extent lawful. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.


 


If the Company shall fail to
comply with Section 6.15 of the First Supplemental Indenture for 180 days,
the annual interest rate borne by the Notes shall be increased from the rate
shown above by 0.50% per annum until such Default is cured or waived.


 


2.                                       Method of
Payment


 


By no later than 10:00 a.m.
(New York City time) on the date on which any principal of or interest on any
Note is due and payable, the Company shall irrevocably deposit with the Trustee
or the Paying Agent money sufficient to pay such principal, premium, if any,
and/or interest. The Company will pay interest (except Defaulted Interest) to
the Persons who are registered Holders of Notes at the close of business on the
May 15 or November 15 next preceding the Interest Payment Date even
if Notes are cancelled, repurchased or redeemed after the Regular Record Date
and on or before the Interest Payment Date. Holders must surrender Notes to a
Paying Agent to collect principal payments. The Company will pay principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. Payments in respect of Notes
represented by a Global Security (including principal, premium, if any, and
interest) will be made by the transfer of immediately available funds to the
accounts specified by The Depository Trust Company. The Company shall make all
payments in respect of a Definitive Security (including principal, premium, if
any, and interest) at the office or agency of the Company maintained for such
purpose in The City of New York, if any, or at such other office or agency of
the Company as may be maintained for such purpose pursuant to the Indenture; provided, however, that, at the option of the Company, each
installment of interest may be paid by (i) check mailed to addresses of
the Persons entitled thereto as such addresses shall appear on the Note
Register or (ii) wire transfer to an account located in the United States
maintained by the payee.


 


3.                                       Paying Agent
and Registrar


 


Initially, Wells Fargo Bank,
National Association will act as Trustee, Paying Agent and Registrar. The
Company may appoint and change any Paying Agent, Registrar or co-registrar 


 


A-2

















 


without
notice to any Holder. The Company or any of its Subsidiaries may act as Paying
Agent, Registrar or co-registrar.


 


4.                                       Indenture


 


The Company issued the Notes
under an Indenture dated as of June 15, 2006 (the “Original
Indenture”), between the Company and Wells Fargo Bank, National
Association, as trustee (the “Trustee”),
as supplemented by the First Supplemental Indenture dated as of May 27,
2009 (the “First Supplemental Indenture”
and, together with the Original Indenture, as it may be further amended or
supplemented from time to time in accordance with the terms thereof, the “Indenture”) between the Company and
the Trustee. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S.C.§§ 77aaa-77bbbb) as in effect on the date of the Indenture (the “Trust Indenture Act”; provided, however, that in the event the Trust Indenture Act
is amended after such date, “Trust Indenture Act” shall mean, to the extent
required by any such amendment, the Trust Indenture Act of 1939 as so amended).
Capitalized terms used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Notes are subject to all such terms, and Holders
are referred to the Indenture and the Trust Indenture Act for a statement of
those terms.


 


The Notes are general
unsecured senior obligations of the Company. The aggregate principal amount of
securities that may be authenticated and delivered under the Indenture is
unlimited. This Note is one of the 101⁄4% Senior Notes due 2014 referred to in
the Indenture (the “Notes”). The Notes include (i) $325,000,000
aggregate principal amount of the Notes issued under the Indenture on May 27,
2009 and (ii) if and when issued, additional Notes that may be issued from
time to time under the Indenture subsequent to May 27, 2009 (herein called
“Additional Notes”). The Notes and
any Additional Notes will be treated as a single class of securities under the
Indenture.


 


5.                                       Reserved


 


6.                                       Subsidiary
Guarantees


 


This Note is guaranteed by
the Persons, if any, specified as Subsidiary Guarantors in the Indenture to the
extent provided in the Indenture.


 


7.                                       Redemption


 


Except as described below,
the Notes are not redeemable at the option of the Company prior to maturity.


 


The Notes may be redeemed,
in whole or in part, at any time at the option of the Company upon not less
than 30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder of Notes at its registered address, at a Redemption Price equal to 100%
of the principal amount of the Notes redeemed plus the Applicable Premium plus
accrued and unpaid interest, if any, to the Redemption Date (subject to the
right of Holders of record on the relevant Regular Record Date to receive
interest due on the relevant Interest Payment Date).


 


A-3

















 


8.                                       Repurchase
Provisions


 


(a)                                  If a Change of
Control occurs, each Holder of Notes will have the right to require the Company
to repurchase all or any part (equal to $2,000 or a larger integral multiple
thereof) of the Notes of such Holder at a purchase price in cash equal to 101%
of the principal amount thereof, plus accrued and unpaid interest, if any, to
the date of repurchase (subject to the right of Holders of record on the
relevant Regular Record Date to receive interest due on the relevant Interest
Payment Date) as provided in, and subject to the terms of, the Indenture.


 


(b)                                 In the event of
an Asset Disposition that requires the purchase of Notes pursuant to Section 6.11
of the First Supplemental Indenture, the Company will be required to apply such
Excess Proceeds to the repayment of the Notes and any Pari Passu Notes in
accordance with the procedures set forth in Section 6.11 of the First
Supplemental Indenture.


 


9.                                       Denominations;
Transfer; Exchange


 


The Notes are in registered
form without coupons in denominations of principal amount of $2,000 and larger
integral multiples of $1,000. A Holder may transfer or exchange Notes in
accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay
any taxes and fees required by law or permitted by the Indenture. The Registrar
need not register the transfer of or exchange of any Note for a period beginning
(i) 15 days before the selection of Notes to be repurchased or redeemed
and ending at the close of business on the day of such selection (except, in
the case of Notes to be redeemed in part, the portion of the Note not to be
redeemed) or (ii) 15 days before an Interest Payment Date and ending on
such Interest Payment Date.


 


10.                                 Persons Deemed
Owners


 


The registered Holder of
this Note may be treated as the owner of it for all purposes.


 


11.                                 Unclaimed Money


 


If money for the payment of
principal or interest remains unclaimed for two years, the Trustee or Paying
Agent shall pay the money back to the Company at its request unless an
abandoned property law designates another Person. After any such payment,
Holders entitled to the money must look only to the Company and not to the
Trustee for payment.


 


12.                                 Defeasance


 


Subject to certain
conditions set forth in the Indenture, the Company at any time may terminate
some or all of its obligations under the Notes and the Indenture if the Company
deposits with the Trustee money or U.S. Government Obligations for the payment
of principal and interest on the Notes to redemption or maturity, as the case
may be.


 


13.                                 Amendment,
Supplement, Waiver


 


Subject to certain
exceptions set forth in the Indenture, (i) the Indenture and the Notes may
be amended or supplemented by the Company, any Subsidiary Guarantors and the
Trustee 


 


A-4

















 


with
the written consent of the Holders of at least a majority in principal amount
of the then outstanding Notes and (ii) any default (other than with
respect to nonpayment or in respect of a provision that cannot be amended
without the written consent of each Holder affected) or noncompliance with any
provision may be waived with the written consent of the Holders of a majority
in principal amount of the then outstanding Notes. Subject to certain
exceptions set forth in the Indenture, without the consent of any Holder, the
Company, any Subsidiary Guarantors and the Trustee may amend or supplement the Indenture
and the Notes to (each of which are more specially described in the Indenture):
cure any ambiguity, omission, defect or inconsistency; comply with Article Four
of the First Supplemental Indenture in respect of the assumption by a Successor
Company of the obligations of the Company or the assumption by a successor
Person of the obligations of any Subsidiary Guarantor under the Indenture;
provide for uncertificated Notes in addition to or in place of certificated
Notes; add Guarantees with respect to the Notes or release a Subsidiary
Guarantor from its obligations under its Subsidiary Guarantee or the Indenture
in accordance with the applicable provisions of the Indenture; secure the
Notes; add to the covenants of the Company for the benefit of the Holders of
the Notes or surrender any right or power conferred upon the Company; make any
change that does not adversely affect the rights of any Holder of Notes; comply
with any requirement of the Commission in connection with the qualification of
the Indenture under the TIA; or conform the text of the Indenture, the Notes or
the Subsidiary Guarantees to any provision of the “Description of notes”
contained in the Prospectus Supplement to the extent that such provision in the
“Description of notes” contained in the Prospectus Supplement is intended to be
a verbatim recitation of a provision of the Indenture, the Notes or the
Subsidiary Guarantees.


 


14.                                 Defaults and
Remedies


 


If an Event of Default
(other than an Event of Default relating to specified bankruptcy covenants)
occurs and is continuing, the Trustee by notice to the Company, or the Holders
of at least 25% in principal amount of the outstanding Notes by notice to the
Company and the Trustee, may, and the Trustee at the request of such Holders
will, declare all the Notes to be due and payable immediately, as provided more
fully in the Indenture. If an Event of Default relating to specified bankruptcy
covenants occurs and is continuing, the principal of, premium, if any, and
accrued and unpaid interest on all the Notes will become and be immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holders, as provided more fully in the Indenture.


 


Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee may
refuse to enforce the Indenture or the Notes unless it receives reasonable
indemnity or security. Subject to certain limitations, Holders of a majority in
principal amount of the Notes may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Holders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment of
principal or interest) if it determines that withholding notice is in their
interest.


 


15.                                 Trustee
Dealings with the Company


 


Subject to certain
limitations set forth in the Indenture, the Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may 


 


A-5

















 


otherwise
deal with and collect obligations owed to it by the Company or its Affiliates
and may otherwise deal with the Company or its affiliates with the same rights
it would have if it were not Trustee.


 


16.                                 No Recourse
Against Others


 


No director, officer,
employee, incorporator or stockholder of the Company or any Subsidiary
Guarantor, as such, shall have any liability for any obligations of the Company
under the Notes, the Indenture or the Subsidiary Guarantees or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.


 


17.                                 Authentication


 


This Note shall not be valid
until an authorized signatory of the Trustee (or an authenticating agent acting
on its behalf) manually signs the certificate of authentication on the other
side of this Note.


 


18.                                 Abbreviations


 


Customary abbreviations may
be used in the name of a Holder or an assignee, such as TEN COM (= tenants in
common), TEN ENT (= tenants by the entirety), JT TEN (= joint tenants with
rights of survivorship and not as tenants in common), CUST (= custodian) and
U/G/M/A (= Uniform Gift to Minors Act).


 


19.                                 CUSIP Numbers


 


Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the Notes and has directed
the Trustee to use CUSIP numbers in notices of redemption as a convenience to
Holders. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.


 


20.                                 Governing Law


 


This Note shall be governed
by, and construed in accordance with, the laws of the State of New York.


 


The Company will furnish to
any Holder upon written request and without charge to the Holder a copy of the
Indenture, which has in it the text of this Note. Requests may be made to:


 


	
   

  	
  BERRY PETROLEUM COMPANY

  	
   

  
	
   

  	
  1999 Broadway, Suite 3700

  	
   

  
	
   

  	
  Denver Colorado 80202

  	
   

  
	
   

  	
  Attention: Corporate Secretary

  	
   

  



 


A-6

















 


ASSIGNMENT FORM


 


To assign this Note, fill in
the form below:


 


I or we assign and transfer
this Note to


 


______________________________________________________


(Print or type assignee’s name, address and
zip code)


 


____________________________________________


(Insert assignee’s soc. sec. or tax I.D. No.)


 


and irrevocably appoint                           
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.


 


Date: __________________
Your Signature _______________________________________________________________________


 


Signature Guarantee:
__________________________________________________________________________________________


(Signature must be
guaranteed)


 


Sign exactly as your name
appears on the other side of this Note.


 


The signature(s) should
be guaranteed by an eligible guarantor institution (banks, stockbrokers,
savings and loan associations and credit unions with membership in an approved
signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.


 


A-7
















 


[TO BE ATTACHED TO GLOBAL SECURITIES]


 


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL
SECURITY


 


The following increases or decreases in this
Global Security have been made:


 


	
  Date of

  Exchange

  	
   

  	
  Amount of decrease in

  Principal Amount of

  this Global Security

  	
   

  	
  Amount of increase in

  Principal Amount of

  this Global Security

  	
   

  	
  Principal Amount of

  this Global Security

  following such

  decrease or increase

  	
   

  	
  Signature of authorized

  signatory of Trustee or

  Securities Custodian

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


A-8

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to have
this Note purchased by the Company pursuant to Section 6.11 or 6.14 of the
First Supplemental Indenture, check either box:


 


	
   

  	
  o

  	
   

  	
  o

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.11

  	
   

  	
  6.14

  



 


If you want to elect to have
only part of this Note purchased by the Company pursuant to Section 6.11
or 6.14 of the First Supplemental Indenture, state the amount in principal
amount (must be integral multiple of $1,000): $                            


 


Date: __________________  Your
Signature:  ______________________________________________________________________


(Sign exactly as your name
appears on the other side of the Note)                   


 


Signature Guarantee: __________________________________________________________________________________________


(Signature must be
guaranteed)


 


The signature(s) should
be guaranteed by an eligible guarantor institution (banks, stockbrokers,
savings and loan associations and credit unions with membership in an approved
signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.


 


A-9

















 


EXHIBIT B


 


FORM OF
SUPPLEMENTAL INDENTURE FOR SUBSIDIARY GUARANTORS


 


This Supplemental Indenture,
dated as
                ,
20     of (this “Supplemental Indenture”),
among [name of future Subsidiary Guarantor] (the “Guarantor”),
Berry Petroleum Company (together with its successors and assigns, the “Company”), each other then existing
Subsidiary Guarantor under the Indenture referred to below, and WELLS FARGO
BANK, NATIONAL ASSOCIATION, as Trustee under the Indenture referred to below.


 


W
I T N E S S E T H:


 


WHEREAS, the Company and the
Trustee have heretofore executed and delivered an Indenture dated as of June 15,
2006 (the “Original Indenture”), as
supplemented by the First Supplemental Indenture dated as of May 27, 2009
(the “First Supplemental Indenture,”
together with the Original Indenture, and as further amended, supplemented,
waived or otherwise modified, the “Indenture”),
providing for the issuance of an unlimited principal amount of the Company’s
101⁄4% Senior Notes due 2014 (the “Notes”);


 


WHEREAS, Section 6.16
of the First Supplemental Indenture provides that after the Issue Date the
Company is required to cause each Restricted Subsidiary (other than a Foreign
Subsidiary) that Guarantees any Indebtedness of the Company or any Subsidiary
Guarantor to execute and deliver to the Trustee a Supplemental Indenture
pursuant to which such Subsidiary Guarantor will unconditionally Guarantee, on
a joint and several basis with the other Subsidiary Guarantors, the full and
prompt payment of the principal of, premium, if any, and interest on the Notes;
and


 


WHEREAS, pursuant to Section 5.02
of the First Supplemental Indenture, the Company, the Subsidiary Guarantors and
the Trustee are authorized to execute and deliver this Supplemental Indenture
to amend the Indenture, without the consent of any Holder;


 


NOW, THEREFORE, in
consideration of the foregoing and for other good and valuable consideration,
the receipt of which is hereby acknowledged, the Guarantor, the Company, the
other Subsidiary Guarantors and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:


 


ARTICLE I

Definitions


 


SECTION 1.1         Defined Terms. As used in this
Supplemental Indenture, terms defined in the Indenture or in the preamble or
recital hereto are used herein as therein defined. The words “herein,” “hereof”
and “hereby” and other words of similar import used in this Supplemental
Indenture refer to this Supplemental Indenture as a whole and not to any
particular section hereof.


 


B-1

















 


ARTICLE II

Agreement to be Bound; Guarantee


 


SECTION 2.1         Agreement to be Bound. The
Guarantor hereby becomes a party to the Indenture, as a Subsidiary Guarantor
and as such will have all of the rights and be subject to all of the
obligations and agreements of a Subsidiary Guarantor under the Indenture. The
Guarantor agrees to be bound by all of the provisions of the Indenture
applicable to a Subsidiary Guarantor and to perform all of the obligations and
agreements of a Subsidiary Guarantor under the Indenture, on a joint and
several basis with the Subsidiary Guarantors parties hereto and thereto, with
the same force and effect as if originally named as a Subsidiary Guarantor
therein and as if such party executed the Indenture on the date thereof.


 


SECTION 2.2         Guarantee. The Guarantor hereby
fully, unconditionally and irrevocably guarantees, as primary obligor and not
merely as surety, jointly and severally with each other Subsidiary Guarantor,
to each Holder of the Notes and the Trustee, the full and punctual payment when
due, whether at maturity, by acceleration, by redemption or otherwise, of the
Obligations pursuant to Article Nine of the First Supplemental Indenture.


 


ARTICLE III

Miscellaneous


 


SECTION 3.1         Notices. All notices and other
communications to the Guarantor shall be given as provided in the Indenture to
the Guarantor, at its address set forth below, with a copy to the Company as
provided in the Indenture for notices to the Company.


 


SECTION 3.2         GOVERNING LAW. THE INTERNAL LAW
OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL
INDENTURE.


 


SECTION 3.3         Severability Clause. In case any
provision in this Supplemental Indenture shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.


 


SECTION 3.4         Ratification of Indenture;
Supplemental Indentures Part of Indenture. Except as expressly amended
hereby, the Indenture is in all respects ratified and confirmed and all the
terms, conditions and provisions thereof shall remain in full force and effect.
This Supplemental Indenture shall form a part of the Indenture for all
purposes, and every Holder of Notes heretofore or hereafter authenticated and
delivered shall be bound hereby. The Trustee makes no representation or
warranty as to the validity or sufficiency of this Supplemental Indenture.


 


SECTION 3.5         Counterparts. The parties may
sign any number of copies of this Supplemental Indenture. Each signed copy
shall be an original, but all of them together represent the same agreement.


 


SECTION 3.6         Headings. The headings of the
Articles and the sections in this Supplemental Indenture are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.


 


B-2

















 


[Signature page follows]


 


B-3

















 


IN WITNESS WHEREOF, the
parties hereto have caused this Supplemental Indenture to be duly executed as
of the date first above written.


 


	
   

  	
  [SUBSIDIARY GUARANTOR],

  
	
   

  	
  as a Subsidiary Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BERRY PETROLEUM COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, NATIONAL
  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


B-4

















 


SCHEDULE 1


 


EXISTING AFFILIATE TRANSACTIONS


 


None