Document:

Exhibit 4.1

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

 

6.50% SENIOR NOTES DUE 2021

 

 

INDENTURE

 

Dated as of November 24, 2010

 

 

U.S. Bank National Association

 

 

CROSS-REFERENCE TABLE*

 

	
  Trust Indenture

  Act Section

  	
   

  	
  Indenture Section

  
	
  310(a)(1)

  	
   

  	
  7.10

  
	
   

  	
  (a)(2)

  	
   

  	
  7.10

  
	
   

  	
  (a)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(4)

  	
   

  	
  N.A.

  
	
   

  	
  (a)(5)

  	
   

  	
  7.10

  
	
   

  	
  (b)

  	
   

  	
  7.10

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  311(a)

  	
   

  	
  7.11

  
	
   

  	
  (b)

  	
   

  	
  7.11

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  312(a)

  	
   

  	
  2.05

  
	
   

  	
  (b)

  	
   

  	
  11.03

  
	
   

  	
  (c)

  	
   

  	
  11.03

  
	
  313(a)

  	
   

  	
  7.06

  
	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  
	
   

  	
  (b)(2)

  	
   

  	
  7.06; 7.07

  
	
   

  	
  (c)

  	
   

  	
  7.06; 11.02

  
	
   

  	
  (d)

  	
   

  	
  7.06

  
	
  314(a)

  	
   

  	
  4.03;11.02; 11.05

  
	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
  (c)(1)

  	
   

  	
  11.04

  
	
   

  	
  (c)(2)

  	
   

  	
  11.04

  
	
   

  	
  (c)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (d)

  	
   

  	
  N.A.

  
	
   

  	
  (e)

  	
   

  	
  11.05

  
	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  315(a)

  	
   

  	
  7.01

  
	
   

  	
  (b)

  	
   

  	
  7.05, 11.02

  
	
   

  	
  (c)

  	
   

  	
  7.01

  
	
   

  	
  (d)

  	
   

  	
  7.01

  
	
   

  	
  (e)

  	
   

  	
  6.11

  
	
  316(a) (last
  sentence)

  	
   

  	
  2.09

  
	
   

  	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
  (b)

  	
   

  	
  6.07

  
	
   

  	
  (c)

  	
   

  	
  2.12

  
	
  317(a)(1)

  	
   

  	
  6.08

  
	
   

  	
  (a)(2)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  2.04

  
	
  318(a)

  	
   

  	
  11.01

  
	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
  (c)

  	
   

  	
  11.01

  

 

N.A.
means not applicable.

*  This Cross Reference Table is not part of the
Indenture.

 

2

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Page

  
	
  ARTICLE 1.

  
	
  DEFINITIONS AND INCORPORATION

  
	
  BY REFERENCE

  
	
   

  	
   

  	
   

  
	
  Section 1.01

  	
  Definitions

  	
  1

  
	
  Section 1.02

  	
  Other Definitions

  	
  25

  
	
  Section 1.03

  	
  Incorporation by Reference of Trust Indenture Act

  	
  25

  
	
  Section 1.04

  	
  Rules of Construction

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2.

  
	
  THE NOTES

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Form and Dating

  	
  26

  
	
  Section 2.02

  	
  Execution and Authentication

  	
  27

  
	
  Section 2.03

  	
  Registrar and Paying Agent

  	
  27

  
	
  Section 2.04

  	
  Paying Agent to Hold Money in Trust

  	
  28

  
	
  Section 2.05

  	
  Holder Lists

  	
  28

  
	
  Section 2.06

  	
  Transfer and Exchange

  	
  28

  
	
  Section 2.07

  	
  Replacement Notes

  	
  42

  
	
  Section 2.08

  	
  Outstanding Notes

  	
  42

  
	
  Section 2.09

  	
  Treasury Notes

  	
  43

  
	
  Section 2.10

  	
  Temporary Notes

  	
  43

  
	
  Section 2.11

  	
  Cancellation

  	
  43

  
	
  Section 2.12

  	
  Defaulted Interest

  	
  43

  
	
  Section 2.13

  	
  CUSIP Numbers

  	
  44

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3.

  
	
  REDEMPTION AND PREPAYMENT

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Notices to Trustee

  	
  44

  
	
  Section 3.02

  	
  Selection of Notes to Be Redeemed or Purchased

  	
  44

  
	
  Section 3.03

  	
  Notice of Redemption

  	
  45

  
	
  Section 3.04

  	
  Effect of Notice of Redemption

  	
  46

  
	
  Section 3.05

  	
  Deposit of Redemption or Purchase Price

  	
  46

  
	
  Section 3.06

  	
  Notes Redeemed or Purchased in Part

  	
  46

  
	
  Section 3.07

  	
  Optional Redemption

  	
  46

  
	
  Section 3.08

  	
  Mandatory Redemption

  	
  47

  
	
  Section 3.09

  	
  Offer to Purchase by Application of Excess Proceeds

  	
  47

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4.

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Payment of Notes

  	
  49

  
	
  Section 4.02

  	
  Maintenance of Office or Agency

  	
  49

  
	
  Section 4.03

  	
  Reports

  	
  50

  
	
  Section 4.04

  	
  Compliance Certificate

  	
  50

  
				

 

i

 

	
  Section 4.05

  	
  Taxes

  	
  51

  
	
  Section 4.06

  	
  Stay, Extension and Usury Laws

  	
  51

  
	
  Section 4.07

  	
  Restricted Payments

  	
  51

  
	
  Section 4.08

  	
  Dividend and Other Payment Restrictions Affecting
  Subsidiaries

  	
  53

  
	
  Section 4.09

  	
  Incurrence of Indebtedness

  	
  54

  
	
  Section 4.10

  	
  Asset Sales

  	
  56

  
	
  Section 4.11

  	
  Transactions with Affiliates

  	
  58

  
	
  Section 4.12

  	
  Liens

  	
  59

  
	
  Section 4.13

  	
  Corporate Existence

  	
  59

  
	
  Section 4.14

  	
  Offer to Repurchase Upon Change of Control

  	
  59

  
	
  Section 4.15

  	
  Limitation on Finance Corp

  	
  61

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5.

  
	
  SUCCESSORS

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Merger, Consolidation, or Sale of Assets

  	
  61

  
	
  Section 5.02

  	
  Successor Corporation Substituted

  	
  62

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6.

  
	
  DEFAULTS AND REMEDIES

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Events of Default

  	
  62

  
	
  Section 6.02

  	
  Acceleration

  	
  64

  
	
  Section 6.03

  	
  Other Remedies

  	
  64

  
	
  Section 6.04

  	
  Waiver of Past Defaults

  	
  65

  
	
  Section 6.05

  	
  Control by Majority

  	
  65

  
	
  Section 6.06

  	
  Limitation on Suits

  	
  65

  
	
  Section 6.07

  	
  Rights of Holders of Notes to Receive Payment

  	
  66

  
	
  Section 6.08

  	
  Collection Suit by Trustee

  	
  66

  
	
  Section 6.09

  	
  Trustee May File Proofs of Claim

  	
  66

  
	
  Section 6.10

  	
  Priorities

  	
  66

  
	
  Section 6.11

  	
  Undertaking for Costs

  	
  67

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7.

  
	
  TRUSTEE

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Duties of Trustee

  	
  67

  
	
  Section 7.02

  	
  Rights of Trustee

  	
  68

  
	
  Section 7.03

  	
  Individual Rights of Trustee

  	
  70

  
	
  Section 7.04

  	
  Trustee’s Disclaimer

  	
  70

  
	
  Section 7.05

  	
  Notice of Defaults

  	
  70

  
	
  Section 7.06

  	
  Reports by Trustee to Holders of the Notes

  	
  70

  
	
  Section 7.07

  	
  Compensation and Indemnity

  	
  70

  
	
  Section 7.08

  	
  Replacement of Trustee

  	
  71

  
	
  Section 7.09

  	
  Successor Trustee by Merger, etc.

  	
  72

  
	
  Section 7.10

  	
  Eligibility; Disqualification

  	
  72

  
	
  Section 7.11

  	
  Preferential Collection of Claims Against the Issuers

  	
  73

  

 

ii

 

	
  ARTICLE 8.

  
	
  LEGAL DEFEASANCE AND COVENANT DEFEASANCE

  
	
   

  
	
  Section 8.01

  	
  Option to Effect Legal Defeasance or Covenant Defeasance

  	
  73

  
	
  Section 8.02

  	
  Legal Defeasance and Discharge

  	
  73

  
	
  Section 8.03

  	
  Covenant Defeasance

  	
  74

  
	
  Section 8.04

  	
  Conditions to Legal or Covenant Defeasance

  	
  74

  
	
  Section 8.05

  	
  Deposited Money and Government Securities to be Held in
  Trust; Other Miscellaneous Provisions

  	
  75

  
	
  Section 8.06

  	
  Repayment to the Issuers

  	
  76

  
	
  Section 8.07

  	
  Reinstatement

  	
  76

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9.

  
	
  AMENDMENT, SUPPLEMENT AND WAIVER

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Without Consent of Holders of Notes

  	
  76

  
	
  Section 9.02

  	
  With Consent of Holders of Notes

  	
  77

  
	
  Section 9.03

  	
  Compliance with Trust Indenture Act

  	
  78

  
	
  Section 9.04

  	
  Revocation and Effect of Consents

  	
  78

  
	
  Section 9.05

  	
  Notation on or Exchange of Notes

  	
  79

  
	
  Section 9.06

  	
  Trustee to Sign Amendments, etc.

  	
  79

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10.

  
	
  SATISFACTION AND DISCHARGE

  
	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  Satisfaction and Discharge

  	
  79

  
	
  Section 10.02

  	
  Application of Trust Money

  	
  80

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11.

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 11.01

  	
  Trust Indenture Act Controls

  	
  81

  
	
  Section 11.02

  	
  Notices

  	
  81

  
	
  Section 11.03

  	
  Communication by Holders of Notes with Other Holders of
  Notes

  	
  82

  
	
  Section 11.04

  	
  Certificate and Opinion as to Conditions Precedent

  	
  82

  
	
  Section 11.05

  	
  Statements Required in Certificate or Opinion

  	
  82

  
	
  Section 11.06

  	
  Rules by Trustee and Agents

  	
  83

  
	
  Section 11.07

  	
  Non-Recourse

  	
  83

  
	
  Section 11.08

  	
  No Personal Liability of Directors, Officers, Employees and
  Stockholders

  	
  83

  
	
  Section 11.09

  	
  Governing Law

  	
  83

  
	
  Section 11.10

  	
  Successors

  	
  83

  
	
  Section 11.11

  	
  Severability

  	
  84

  
	
  Section 11.12

  	
  Counterpart Originals

  	
  84

  
	
  Section 11.13

  	
  Table of Contents, Headings, etc.

  	
  84

  
	
  Section 11.14

  	
  Force Majeure

  	
  84

  
	
  Section 11.15

  	
  U.S.A. Patriot Act

  	
  84

  
	
   

  	
   

  	
   

  
	
  EXHIBITS

  
	
   

  	
   

  	
   

  
	
  Exhibit A1

  	
  FORM OF
  NOTE

  	
   

  
	
  Exhibit A2

  	
  FORM OF
  REGULATION S TEMPORARY GLOBAL NOTE

  	
   

  
	
  Exhibit B

  	
  FORM OF
  CERTIFICATE OF TRANSFER

  	
   

  
	
  Exhibit C

  	
  FORM OF
  CERTIFICATE OF EXCHANGE

  	
   

  
	
  Exhibit D

  	
  FORM OF
  CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

  	
   

  

 

iii

 

This
INDENTURE dated as of November 24, 2010 among Ferrellgas, L.P., a Delaware
limited liability partnership (the “Company”),
Ferrellgas Finance Corp., a Delaware corporation (“Finance Corp.,” and together with the Company, the “Issuers”), and U.S. Bank National
Association, as trustee (the “Trustee”).

 

The
Issuers and the Trustee agree as follows for the benefit of each other and for
the equal and ratable benefit of the Holders (as defined below) of the 6.50%
Senior Notes due 2021 (the “Notes”):

 

ARTICLE 1.

DEFINITIONS AND INCORPORATION

BY REFERENCE

 

Section 1.01                                Definitions.

 

“144A Global Note” means a Global Note
substantially in the form of Exhibit A1 hereto bearing the Global Note
Legend and the Private Placement Legend and deposited with or on behalf of, and
registered in the name of, the Depositary or its nominee that will be issued in
a denomination equal to the outstanding principal amount of the Notes sold in
reliance on Rule 144A.

 

“Accounts Receivable Securitization” means a
financing arrangement involving the transfer or sale of accounts receivable of
the Partnership and its Restricted Subsidiaries in the ordinary course of
business through one or more SPEs, the terms of which arrangement do not impose
(a) any recourse or repurchase obligations upon the Partnership and its
Restricted Subsidiaries or any Affiliate of the Partnership and its Restricted
Subsidiaries (other than any such SPE) except to the extent of the breach of a
representation or warranty by the Partnership and its Restricted Subsidiaries
in connection therewith or (b) any negative pledge or Lien on any accounts
receivable not actually transferred to any such SPE in connection with such
arrangement.

 

“Additional Notes” means additional notes
(other than the Initial Notes and the Exchange Notes) issued from time to time
under this Indenture in accordance with Sections 2.02 and 4.09 hereof, as part
of the same series as the Initial Notes.

 

“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
purposes of this definition, “control,” as used with respect to any Person,
will mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10%
or more of the voting securities of a Person shall be deemed to be
control.  For purposes of this
definition, the terms “controlling,”
“controlled by” and “under common control with” will have
correlative meanings.

 

“Agent” means any Registrar,
co-registrar, Paying Agent or additional paying agent.

 

 

1

 

“Applicable Procedures” means, with respect to any
transfer or exchange of, or for beneficial interests in, any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.

 

“Asset Acquisition” means the following (in all
cases, including assets acquired through a Flow-Through Acquisition):

 

(1)           an Investment by the Partnership or any Restricted
Subsidiary of the Partnership in any other Person pursuant to which the Person
shall become a Restricted Subsidiary of the Partnership, or shall be merged
with or into the Partnership or any Restricted Subsidiary of the Partnership;

 

(2)           the acquisition by the Partnership or any Restricted
Subsidiary of the Partnership of the assets of any Person, other than a
Restricted Subsidiary of the Partnership, which constitute all or substantially
all of the assets of such Person; or

 

(3)           the acquisition by the Partnership or any Restricted
Subsidiary of the Partnership of any division or line of business of any
Person, other than a Restricted Subsidiary of the Partnership.

 

“Asset Sale” means either of the
following, whether in a single transaction or a series of related transactions:

 

(1)           the sale, lease, conveyance or other disposition of any
assets other than (a) sales, leases or transfers of assets in the ordinary
course of business (including but not limited to the sales of inventory in the
ordinary course of business), and (b) sales of accounts receivable under
any Accounts Receivable Securitization; or

 

(2)           the issuance or sale of Capital Stock of any direct
Subsidiary.

 

Notwithstanding
the preceding, none of the following items will be deemed to be an Asset Sale:

 

(1)           any sale, lease or transfer of assets or Capital Stock by
the Partnership or any of its Restricted Subsidiaries to the Issuers or a
Restricted Subsidiary;

 

(2)           any sale or transfer of assets or Capital Stock by the
Partnership or any of its Restricted Subsidiaries to any entity in exchange for
other assets used in a related business and/or cash (provided, that such cash portion is at least 75% of the
difference between the value of the assets being transferred and the value of
the assets being received) and having a fair market value, as determined in
good faith by an authorized financial officer of the General Partner,
reasonably equivalent to the fair market value of the assets so transferred;

 

(3)           any sale, lease or transfer of assets in accordance with
Permitted Investments;

 

(4)           the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Partnership; provided, that the sale, lease, conveyance or other 

 

2

 

disposition of all or substantially
all of the assets of the Partnership will be governed by Section 4.14
hereof and/or Section 5.01 hereof and not Section 4.10 hereof;

 

(5)           the transfer or disposition of assets that are permitted
Restricted Payments;

 

(6)           any sale, lease or transfer of assets pursuant to a sale
and leaseback transaction, provided
that the fair market value of all assets so sold, leased or transferred shall
not exceed $25 million from and after the date of this Indenture;

 

(7)           sales or transfers of assets not otherwise covered which
do not generate proceeds in excess of $2.5 million; and

 

(8)           sales or transfers of accounts receivable under an
Accounts Receivable Securitization.

 

“Available Cash” as to any quarter means:

 

(1)           the sum of:

 

(a)  all cash receipts
of the Partnership during such quarter from all sources (including, without
limitation, distributions of cash received from Subsidiaries of the
Partnership, cash proceeds from Interim Capital Transactions, but excluding
cash proceeds from Termination Capital Transactions, and borrowings made under
the Credit Facilities); and

 

(b)  any reduction with
respect to such quarter in a cash reserve previously established pursuant to
clause (2)(b) below (either by reversal or utilization) from the level of
such reserve at the end of the prior quarter;

 

(2)           less the sum of:

 

(a)  all cash
disbursements of the Partnership during such quarter, including, without
limitation, disbursements for operating expenses, taxes, if any, debt service
(including, without limitation, the payment of principal, premium and
interest), redemption of Capital Stock of the Partnership, capital
expenditures, contributions, if any, to a Subsidiary and cash distributions to
partners of the Partnership (but only to the extent that such cash distributions
to partners exceed Available Cash for the immediately preceding quarter); and

 

(b)  any cash reserves
established with respect to such quarter, and any increase with respect to such
quarter in a cash reserve previously established pursuant to this clause (2)(b) from
the level of such reserve at the end of the prior quarter, in such amounts as
the General Partner determines in its reasonable discretion to be necessary or
appropriate (i) to provide for the proper conduct of the business of the
Partnership (including, without limitation, reserves for future capital
expenditures), (ii) to provide funds for distributions with respect to
Capital Stock of the Partnership in respect of any one or more of the next four
quarters or (iii) because the distribution of such amounts would be
prohibited by applicable law or by any loan agreement, security agreement, 

 

3

 

mortgage, debt instrument or other agreement or
obligation to which the Partnership is a party or by which it is bound or its
assets are subject;

 

(3)           plus the lesser of (a) an amount as calculated in
accordance with clauses (1) and (2) above for the Partnership or its
Restricted Subsidiaries for the first 45 days of the quarter during which such
Restricted Payment is made (rather than the quarter for which clauses (1) and
(2) were calculated) and (b) an amount of working capital
Indebtedness that the Partnership or its Restricted Subsidiaries could have
incurred on or before the 45th day after the last day of the quarter used to
calculate clauses (1) and (2) above;

 

provided, however, that Available Cash
attributable to any Restricted Subsidiary of the Partnership will be excluded
to the extent dividends or distributions of Available Cash by the Restricted Subsidiary
are not at the date of determination permitted by the terms of its charter or
any agreement, instrument, judgment, decree, order, statute, rule or other
regulation.

 

Notwithstanding
the foregoing, (x) disbursements (including, without limitation,
contributions to a Subsidiary or disbursements on behalf of a Subsidiary) made
or reserves established, increased or reduced after the end of any quarter but
on or before the date on which any Restricted Payment requiring a determination
of Available Cash for such quarter is made shall be deemed to have been made,
established, increased or reduced, for purposes of determining Available Cash,
with respect to such quarter if the General Partner so determines, and (y) “Available
Cash” shall not include any cash receipts or reductions in reserves or take
into account any disbursements made or reserves established in each case after
the date of liquidation of the Partnership. Taxes paid by the Partnership on
behalf of, or amounts withheld with respect to, all or less than all of the
partners shall not be considered cash disbursements of the Partnership that
reduce Available Cash, but the payment or withholding thereof shall be deemed
to be a distribution of Available Cash to the partners. Alternatively, in the discretion
of the General Partner, such taxes (if pertaining to all partners) may be
considered to be cash disbursements of the Partnership which reduce Available
Cash, but the payment or withholding thereof shall not be deemed to be a
distribution of Available Cash to such partners.

 

“Bankruptcy Law” means Title 11, U.S. Code
or any similar federal or state law for the relief of debtors.

 

“Beneficial Owner” has the meaning assigned
to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act,
except that in calculating the beneficial ownership of any particular “Person”
(as that term is used in Section 13(d)(3) of the Exchange Act), such “Person”
will be deemed to have beneficial ownership of all securities that such “Person”
has the right to acquire by conversion or exercise of other securities, whether
such right is currently exercisable or is exercisable only upon the occurrence
of a subsequent condition.  The terms “Beneficially
Owns” and “Beneficially Owned” have a corresponding meaning.

 

“Board of Directors” means:

 

(1)           with respect to a corporation, the board of directors of
the corporation;

 

4

 

(2)           with respect to a partnership, the Board of Directors of
the general partner of the partnership; and

 

(3)           with respect to any other Person, the board or committee
of such Person serving a similar function.

 

“Borrowing Base” means, as of any date, an
amount equal to:

 

(1)           80% of the face amount of all accounts receivable owned by
the Partnership and its Subsidiaries as of the end of the most recent month
preceding such date that were not more than 90 days past due; plus

 

(2)           70% of the value of all inventory owned by the Partnership
and its Subsidiaries as of the end of the most recent month preceding such date,

 

in
each case, calculated on a consolidated basis and in accordance with GAAP.

 

“Business Day” means any day other than a
Legal Holiday.

 

“Capital Stock” means of any Person any
capital stock, partnership interest, membership interest, or equity interest of
any kind.

 

“Change of Control” means

 

(1)           the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Partnership to any entity other than to
a Related Party;

 

(2)           the liquidation or dissolution of the Partnership or the
General Partner, or a successor to the General Partner; or

 

(3)           any transaction or series of transactions that results in
a Person other than a Related Party beneficially owning in the aggregate,
directly or indirectly, more than 35% of the voting stock of the General
Partner or a successor to the General Partner and such percentage is more than
the percentage of voting stock that is owned by the Related Party or a
successor to the Related Party.

 

“Consolidated Cash Flow Available for Fixed Charges”
means, with respect to the Partnership and its Restricted Subsidiaries, for any
period, the sum of, without duplication, the amounts for the period, taken as
single accounting, of:

 

(1)           Consolidated Net Income;

 

(2)           Consolidated Non-cash Charges;

 

(3)           Consolidated Interest Expense; and

 

(4)           Consolidated Income Tax Expense.

 

5

 

“Consolidated Fixed Charge Coverage Ratio” means, with
respect to the Partnership and its Restricted Subsidiaries, the ratio of (y) the
aggregate amount of Consolidated Cash Flow Available for Fixed Charges of the
Person for the four full fiscal quarters immediately preceding the date of the
transaction (the “Transaction Date”) giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio (the “Four Quarter Period”), to (z) the
aggregate amount of Consolidated Fixed Charges of the Person for the Four
Quarter Period.  In addition to and
without limitation of the foregoing, for purposes of this definition, “Consolidated
Cash Flow Available for Fixed Charges” and “Consolidated Fixed Charges” shall
be calculated after giving effect on a pro forma basis for the period of the
calculation to, without duplication:

 

(1)           the incurrence or repayment of any Indebtedness, excluding
the incurrence of revolving credit borrowings and repayments of revolving
credit borrowings (other than the incurrence and repayment of any revolving
credit borrowings the proceeds of which are used for Asset Acquisitions or
Growth Related Capital Expenditures of the Partnership or any of its Restricted
Subsidiaries and, in the case of any incurrence or revolving credit borrowings,
the application of the net proceeds thereof) during the period commencing on
the first day of the Four Quarter Period to and including the Transaction Date
(the “Reference Period”), including, without limitation, the incurrence of the
Indebtedness giving rise to the need to make the calculation (and the
application of the net proceeds thereof), as if the incurrence (and
application) occurred on the first day of the Reference Period; and

 

(2)           any Asset Sales or Asset Acquisitions (including, without limitation,
any Asset Acquisition giving rise to the need to make the calculation as a
result of the Partnership or one of its Restricted Subsidiaries, including any
Person who becomes a Restricted Subsidiary as a result of the Asset
Acquisition, incurring, assuming or otherwise being liable for Acquired
Indebtedness) occurring during the Reference Period, as if the Asset Sale or
Asset Acquisition occurred on the first day of the Reference Period; provided, however, that:

 

(a)  Consolidated Fixed
Charges will be reduced by amounts attributable to businesses or assets that
are so disposed of only to the extent that the obligations giving rise to such
Consolidated Fixed Charges would no longer be obligations contributing to the
Consolidated Fixed Charges subsequent to the date of determination of the
Consolidated Fixed Charge Coverage Ratio;

 

(b)  Consolidated Cash
Flow Available for Fixed Charges generated by an acquired business or asset
shall be determined by the actual gross profit, which is equal to revenues
minus cost of goods sold, of the acquired business or asset during the
immediately available preceding four full fiscal quarters occurring in the
Reference Period, minus the pro forma expenses that would have been incurred by
the Partnership and its Restricted Subsidiaries in the operation of the
acquired business or asset during the period computed on the basis of personnel
expenses for employees retained or to be retained by the Partnership and its
Restricted Subsidiaries in the operation of the acquired business or asset and
non-personnel costs and expenses incurred by or to be incurred by the
Partnership and its Restricted Subsidiaries based upon the operation of the
Partnership’s business, all as determined in good faith by an authorized
financial officer of the General Partner; and

 

6

 

(c)  Consolidated Cash
Flow Available for Fixed Charges shall not include the impact of any
nonrecurring cash charges incurred in connection with a restructuring, reorganization
or other similar transaction, as determined in good faith by an authorized
financial officer of the General Partner.

 

Furthermore,
subject to the following paragraph, in calculating “Consolidated Fixed Charges”
for purposes of determining the “Consolidated Fixed Charge Coverage Ratio”:

 

(1)           interest on outstanding Indebtedness, other than
Indebtedness referred to in the point below, determined on a fluctuating basis
as of the last day of the Four Quarter Period and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum
equal to the rate of interest on such Indebtedness in effect on that date;

 

(2)           only actual interest payments associated with Indebtedness
incurred in accordance with clause (4) of the definition of Permitted
Indebtedness and all Permitted Refinancing Indebtedness in respect thereof,
during the Four Quarter Period shall be included in the calculation; and

 

(3)           if interest on any Indebtedness actually incurred on the
date may optionally be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate, or other rates,
then the interest rate in effect on the last day of the Four Quarter Period
will be deemed to have been in effect during the period.

 

“Consolidated Fixed Charges” means, with
respect to the Partnership and its Restricted Subsidiaries for any period, the
sum of, without duplication:

 

(1)           the amounts for such period of Consolidated Interest
Expense; and

 

(2)           the product of:

 

(a)  the aggregate
amount of dividends and other distributions paid or accrued during the period
in respect of Preferred Stock and Redeemable Capital Stock of the Partnership
and its Restricted Subsidiaries on a consolidated basis; and

 

(b)  a fraction, the
numerator of which is one and the denominator of which is one less the then
applicable current combined federal, state and local statutory tax rate,
expressed as a percentage.

 

“Consolidated Income Tax Expense” means,
with respect to the Partnership and its Restricted Subsidiaries for any period,
the provision for federal, state, local and foreign income taxes of the
Partnership and its Restricted Subsidiaries for the period as determined on a
consolidated basis in accordance with GAAP.

 

“Consolidated Interest Expense” means, with
respect to the Partnership and its Restricted Subsidiaries, for any period, the
interest expense of the Partnership and its Restricted Subsidiaries for the
period as determined on a consolidated basis in accordance with GAAP,
including, without limitation:

 

7

 

(1)           any amortization of debt discount;

 

(2)           the net cost under Interest Rate Agreements;

 

(3)           the interest portion of any deferred payment obligation;

 

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

 

(5)           all accrued interest for all instruments evidencing
Indebtedness; and

 

(6)           the interest component of Capital Leases paid or accrued
or scheduled to be paid or accrued by the Partnership and its Restricted
Subsidiaries during the period as determined on a consolidated basis in
accordance with GAAP.

 

“Consolidated Net Income” means the net
income of the Partnership and its Restricted Subsidiaries, as determined on a
consolidated basis in accordance with GAAP and as adjusted to exclude:

 

(1)           net after-tax extraordinary gains or losses;

 

(2)           net after-tax gains or losses attributable to Asset Sales
or sales of receivables under any Accounts Receivable Securitization;

 

(3)           the net income or loss of any Person which is not a
Restricted Subsidiary and which is accounted for by the equity method of
accounting; provided, that
Consolidated Net Income shall include the amount of dividends or distributions
actually paid to the Partnership or any Restricted Subsidiary;

 

(4)           the net income or loss prior to the date of acquisition of
any Person combined with the Partnership or any Restricted Subsidiary in a
pooling of interest;

 

(5)           the net income of any Restricted Subsidiary to the extent
that dividends or distributions of that net income are not at the date of
determination permitted by the terms of its charter or any judgment, decree,
order, statute, rule or other regulation; and

 

(6)           the cumulative effect of any changes in accounting
principles.

 

“Consolidated Net Tangible Assets” means as
of any date of determination, the Total Assets of the Partnership and the
Restricted Subsidiaries as would be shown on a consolidated balance sheet of
the Partnership and the Restricted Subsidiaries prepared in accordance with
GAAP as of that date less applicable reserves reflected in such balance sheet,
after deducting the following amounts: (a) all current liabilities
reflected in such balance sheet, and (b) all goodwill, trademarks,
patents, unamortized debt discounts and expenses and other like intangibles
reflected in such balance sheet.

 

“Consolidated Non-Cash Charges” means, with
respect to the Partnership and its Restricted Subsidiaries for any period, the
aggregate (1) depreciation, (2) amortization,  (3) non-cash employee compensation
expenses of the Partnership or its Restricted Subsidiaries for such 

 

8

 

period,
and (4) any non-cash charges resulting from writedowns of non-current
assets, in each case which reduces the Consolidated Net Income of the
Partnership and its Restricted Subsidiaries for the period, as determined on a
consolidated basis in accordance with GAAP.

 

“Corporate Trust Office of the Trustee”
will be at the address of the Trustee specified in Section 11.02 hereof or
such other address as to which the Trustee may give notice to the Issuers.

 

“Credit Agreement” means that Credit
Agreement, dated as of November 2, 2009, among the Partnership, the General
Partner, Bank of America, N.A., as agent, and the other financial institutions
party thereto as heretofore amended (as amended, the “Existing Credit Agreement”), as the
Existing Credit Agreement may be amended, restated, modified, renewed,
refunded, replaced or refinanced from time to time.

 

“Credit Facilities” means, one or more debt
facilities (including, without limitation, the facilities evidenced by the
Credit Agreement) or commercial paper facilities, or indentures, in each case
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.

 

“Custodian” means the Trustee, as
custodian with respect to the Notes in global form, or any successor entity
thereto.

 

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

 

“Definitive Note” means a certificated Note
registered in the name of the Holder thereof and issued in accordance with Section 2.06
hereof, substantially in the form of Exhibit A hereto except that such
Note shall not bear the Global Note Legend and shall not have the “Schedule of
Exchanges of Interests in the Global Note” attached thereto.

 

“Depositary” means, with respect to the
Notes issuable or issued in whole or in part in global form, the Person
specified in Section 2.03 hereof as the Depositary with respect to the
Notes, and any and all successors thereto appointed as depositary hereunder and
having become such pursuant to the applicable provision of this Indenture.

 

“Designation Amount” means, with respect to
the designation of a Restricted Subsidiary or a newly acquired or formed
Subsidiary as an Unrestricted Subsidiary, an amount equal to the sum of:

 

(1)           the net book value of all assets of the Subsidiary at the
time of the designation in the case of a Restricted Subsidiary; and

 

(2)           the cost of acquisition or formation in the case of a
newly acquired or formed Subsidiary.

 

“Equity Offering” means a public offering or
private placement of partnership interests (other than interests that are
mandatorily redeemable) of:

 

9

 

(1)           any entity that directly or indirectly owns equity
interests in the Partnership, to the extent the net proceeds are contributed to
the Partnership;

 

(2)           any Subsidiary of the Partnership to the extent the net
proceeds are distributed, paid, lent or otherwise transferred to the
Partnership that results in the net proceeds to the Partnership of at least $20
million; or

 

(3)           the Partnership.

 

A
private placement of partnership interests will not be deemed an Equity
Offering unless net proceeds of at least $20 million are received.

 

“Euroclear” means Euroclear Bank,
S.A./N.V., as operator of the Euroclear system.

 

“Exchange Act” means the Securities
Exchange Act of 1934, as amended.

 

“Exchange Notes” means the Notes issued in
the Exchange Offer, if any, pursuant to Section 2.06(f) hereof.

 

“Exchange Offer” has the meaning set forth
in the Registration Rights Agreement.

 

“Exchange Offer Registration Statement” has the
meaning set forth in the Registration Rights Agreement.

 

“Ferrellgas Partners” means  Ferrellgas Partners, L.P.

 

“Flow-Through Acquisition” means an acquisition by the
General Partner or its parent from a Person that is not an Affiliate of the
General Partner, its parent or the Partnership, of property (real or personal),
assets or equipment (whether through the direct purchase of assets or the
Capital Stock of the Person owning such assets) in a permitted line of
business, which is promptly sold, transferred or contributed by the General
Partner or its parent to the Partnership or one of its Subsidiaries.

 

“GAAP” means generally accepted accounting
principles 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 have been approved by a
significant segment of the accounting profession, in each case, which are in
effect on the date of this Indenture.

 

“General Partner” means Ferrellgas, Inc.

 

“Global Notes” means, individually and
collectively, each of the Restricted Global Notes and the Unrestricted Global
Notes deposited with or on behalf of and registered in the name of the
Depositary or its nominee, substantially in the form of Exhibit A1 hereto
and that bears the Global Note Legend and that has the “Schedule of Exchanges
of Interests in the Global Note” attached thereto, issued in accordance with Section 2.01,
2.06(b)(3), 2.06(b)(4), 2.06(d)(2) or 2.06(g)(2) hereof.

 

10

 

“Global Note Legend” means the legend set forth
in Section 2.06(g)(2), which is required to be placed on all Global Notes
issued under this Indenture.

 

“Government Securities” means direct obligations
of, or obligations guaranteed by, the United States of America, and the payment
for which the United States pledges its full faith and credit.

 

“Growth Related Capital Expenditures” means, with
respect to any Person, all capital expenditures by such Person made to improve
or enhance the existing capital assets or to increase the customer base of such
Person or to acquire or construct new capital assets (but excluding capital
expenditures made to maintain, up to the level thereof that existed at the time
of such expenditure, the operating capacity of the capital assets of such
Person as such assets existed at the time of such expenditure).

 

“Holder” means a Person in whose
name a Note is registered.

 

“IAI Global Note” means a Global Note
substantially in the form of Exhibit A1 hereto bearing the Global Note
Legend and the Private Placement Legend and deposited with or on behalf of and
registered in the name of the Depositary or its nominee that will be issued in
a denomination equal to the outstanding principal amount of the Notes sold to
Institutional Accredited Investors.

 

“Indebtedness” means, as applied to any
Person, without duplication:

 

(1)           (a) any indebtedness for borrowed money and (b) all
obligations evidenced by any (i) bond, note, debenture or other similar
instrument or (ii) letter of credit, or reimbursement agreements in
respect thereof, but only for any drawings that are not reimbursed within five
Business Days after the date of such drawings, which in each case the Person
has, directly or indirectly, created, incurred or assumed;

 

(2)           any indebtedness for borrowed money and all obligations
evidenced by any bond, note, debenture or other similar instrument secured by
any Lien in respect of property owned by the Person, whether or not the Person
has assumed or become liable for the payment of the indebtedness; provided, that the amount of the
indebtedness, if the Person has not assumed the same or become liable therefor,
shall in no event be deemed to be greater than the fair market value from time
to time, as determined in good faith by the Person of the property subject to
the Lien;

 

(3)           any indebtedness, whether or not for borrowed money
(excluding trade payables and accrued expenses arising in the ordinary course
of business) with respect to which the Person has become directly or indirectly
liable and which represents the deferred purchase price, or a portion thereof,
or has been incurred to finance the purchase price, or a portion thereof, of
any property or business acquired by, or service performed on behalf of, the
Person, whether by purchase, consolidation, merger or otherwise;

 

(4)           the principal component of any obligations under Capital
Leases to the extent the obligations would, in accordance with GAAP, appear on
the balance sheet of the Person;

 

11

 

(5)           any indebtedness of any other Person of the character
referred to in the foregoing clauses (1)-(4) of this definition with
respect to which the Person whose indebtedness is being determined has become
liable by way of a guarantee; and

 

(6)           all Redeemable Capital Stock of the Person valued at the
greater of its voluntary or involuntary maximum fixed repurchase price plus
accrued dividends.

 

For
purposes hereof, the “maximum fixed repurchase price” of any Redeemable Capital
Stock which does not have a fixed repurchase price shall be calculated in
accordance with the terms of the Redeemable Capital Stock as if it were
purchased on any date on which Indebtedness shall be required to be determined
pursuant to this Indenture and if the price is based upon, or measured by, the
fair market value of the Redeemable Capital Stock, the fair market value shall
be determined in good faith by the Board of Directors of the issuer of the
Redeemable Capital Stock.  For purposes
hereof, the term “Indebtedness” shall not include (x) accrual of interest,
the accretion of accreted value and the payment of interest or any other
similar incurrence by the Partnership or its Restricted Subsidiaries related to
Indebtedness otherwise permitted in this Indenture, (y) Indebtedness under
any hedging arrangement which provides for the right or obligation to purchase,
sell or deliver any currency, commodity or security at a future date for a
specified price entered into to protect such Person from fluctuations in prices
or rates, including currencies, interest rates, commodity prices, and
securities prices, including without limitation indebtedness under any interest
rate or commodity price swap agreement, interest rate cap agreement, interest
rate collar agreement or any forward sales arrangements, calls, options, swaps,
or other similar transactions or any combination thereof, including, or (z) any
Accounts Receivable Securitization.

 

“Indenture” means this Indenture, as
amended or supplemented from time to time.

 

“Indirect Participant” means a Person who holds a
beneficial interest in a Global Note through a Participant.

 

“Initial Notes” means the first
$500,000,000 aggregate principal amount of Notes issued under this Indenture on
the date hereof.

 

“Initial Purchasers” means J.P. Morgan
Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Wells Fargo Securities, LLC, Barclays Capital Inc., BNP Paribas Securities
Corp., Capital One Southcoast, Inc., Fifth Third Securities, Inc.,
PNC Capital Markets LLC, SG Americas Securities, LLC, UBS Securities LLC and
U.S. Bancorp Investments, Inc.

 

“Interim Capital Transactions” means (1) borrowings,
refinancings or refundings of Indebtedness and sales of debt securities (other
than for working capital purposes and other than for items purchased on open
account in the ordinary course of business) by the Partnership, (2) sales
of Capital Stock of the Partnership by the Partnership and (3) sales or
other voluntary or involuntary dispositions of any assets of the Partnership
(other than (x) sales or other dispositions of inventory in the ordinary
course of business, (y) sales or other dispositions of other current
assets including, without limitation, receivables and accounts and (z) sales
or other dispositions of assets as a part of normal retirements or
replacements), in each case prior to the commencement of the dissolution and
liquidation of the Partnership.

 

12

 

“Investment” means as applied to any
Person:

 

(1)           any direct or indirect purchase or other acquisition by
the Person of stock or other securities of any other Person; or

 

(2)           any direct or indirect loan, advance or capital
contribution by the Person to any other Person and any other item which would
be classified as an “investment” on a balance sheet of the Person prepared in
accordance with GAAP, including without limitation any direct or indirect
contribution by the Person of property or assets to a joint venture,
partnership or other business entity in which the Person retains an interest,
it being understood that a direct or indirect purchase or other acquisition by
the Person of assets of any other Person, other than stock or other securities,
shall not constitute an “Investment” for purposes of this Indenture.

 

The
amount classified as Investments made during any period will be the aggregate
cost to the Partnership and its Restricted Subsidiaries of all the Investments
made during the period, determined in accordance with GAAP, but without regard
to unrealized increases or decreases in value, or write-ups, write-downs or
write-offs, of the Investments and without regard to the existence of any
undistributed earnings or accrued interest with respect thereto accrued after
the respective dates on which the Investments were made, less any net return of
capital realized during the period upon the sale, repayment or other
liquidation of the Investments, determined in accordance with GAAP, but without
regard to any amounts received during the period as earnings (in the form of
dividends not constituting a return of capital, interest or otherwise) on the
Investments or as loans from any Person in whom the Investments have been made.

 

“Legal Holiday” means a Saturday, a Sunday
or a day on which banking institutions in the City of New York or at a place of
payment are authorized by law, regulation or executive order to remain
closed.  If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.

 

“Lien” means, with respect to any asset, any
mortgage, lien (statutory or otherwise), pledge, charge, security interest,
hypothecation, assignment for security or other encumbrance of any kind in
respect of such asset.  A Person shall be
deemed to own subject to a Lien any asset which such Person has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement.

 

“Net Amount of Unrestricted Investment” means, without
duplication, the sum of:

 

(1)           the aggregate amount of all Investments made after the
date of this Indenture pursuant to clause (3) of the definition of
Permitted Investment hereto, computed as provided in the last sentence of the
definition of Investment herein; and

 

(2)           the aggregate of all Designation Amounts in connection
with the designation of Unrestricted Subsidiaries, less all Designation Amounts
in respect of Unrestricted Subsidiaries which have been designated as
Restricted Subsidiaries and otherwise reduced in a manner consistent with the
provisions of the last sentence of the definition of Investment herein.

 

13

 

“Net Proceeds” means, with respect to any
asset sale or sale of Capital Stock, the proceeds therefrom in the form of cash
or cash equivalents including payments in respect of deferred payment
obligations when received in the form of cash or cash equivalents, except to
the extent that the deferred payment obligations are financed or sold with
recourse to the Partnership or any of its Restricted Subsidiaries, net of:

 

(1)           brokerage commissions and other fees and expenses related
to the Asset Sale, including, without limitation, fees and expenses of legal
counsel and accountants and fees, expenses, discounts or commissions of
underwriters, placement agents and investment bankers;

 

(2)           provisions for all taxes payable as a result of the Asset
Sale;

 

(3)           amounts required to be paid to any Person, other than the
Partnership or any Restricted Subsidiary of the Partnership, owning a
beneficial interest in the assets subject to the Asset Sale;

 

(4)           appropriate amounts to be provided by the Partnership or
any Restricted Subsidiary of the Partnership, as the case may be, as a reserve
required in accordance with GAAP against any liabilities associated with the
Asset Sale and retained by the Partnership or any Restricted Subsidiary of the
Partnership, as the case may be, after the Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with the Asset Sale; and

 

(5)           amounts applied to the repayment of Indebtedness in
connection with the asset or assets acquired in the Asset Sale, including any
transaction costs and expenses associated therewith and any make-whole or other
premium owed in connection with such repayment.

 

“Notes” has the meaning assigned to
it in the preamble to this Indenture. 
The Initial Notes, the Additional Notes and the Exchange Notes shall be
treated as a single class for all purposes under this Indenture, and unless the
context otherwise requires, all references to the Notes shall include the
Initial Notes, any Additional Notes and the Exchange Notes.

 

“Officer” means, with respect to any
Person, the Chairman of the Board, the Chief Executive Officer, the President,
the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any
Assistant Treasurer, the Controller, the Secretary or any Vice-President of
such Person.

 

“Officers’ Certificate” means a certificate signed
on behalf of the Issuers by two Officers of the Issuers, one of whom must be
the principal executive officer, the principal financial officer or the
principal accounting officer of the Issuers, that meets the requirements of Section 11.05
hereof.

 

“Opinion of Counsel” means an opinion from legal
counsel who is reasonably acceptable to the Trustee, that meets the
requirements of Section 11.05 hereof. 
The counsel may be an employee of or counsel to the Issuers, any
Subsidiary of the Issuers or the Trustee.

 

14

 

“Participant” means, with respect to the
Depositary, a Person who has an account with the Depositary.

 

“Partnership” means Ferrellgas, L.P.,
without its consolidated subsidiaries.

 

“Permitted Investments” means any of the following:

 

(1)           Investments made or owned by the Partnership or any
Restricted Subsidiary in:

 

(a)  marketable
obligations issued or unconditionally guaranteed by the United States, or
issued by any agency thereof and backed by the full faith and credit of the
United States, in each case maturing one year or less from the date of
acquisition thereof;

 

(b)  marketable direct
obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within one year from the date of acquisition thereof and having as at such date
the highest rating obtainable from either Standard & Poor’s Ratings
Group (“S&P”) and its successors or Moody’s Investors Service, Inc. (“Moody’s”)
and its successors;

 

(c)  commercial paper
maturing no more than 270 days from the date of creation thereof and having as
at the date of acquisition thereof one of the two highest ratings obtainable
from either S&P or Moody’s;

 

(d)  certificates of
deposit maturing one year or less from the date of acquisition thereof issued
by commercial banks incorporated under the laws of the United States or any
state thereof or the District of Columbia or Canada;

 

(e)  the commercial
paper or other short term unsecured debt obligations of which are as at such
date rated either “A-2” or better (or comparably if the rating system is
changed) by S&P or “Prime-2” or better (or comparably if the rating system
is changed) by Moody’s;

 

(f)  the long-term debt
obligations of which are, as at such date, rated either “A” or better (or
comparably if the rating system is changed) by either S&P or Moody’s (“Permitted
Banks”);

 

(g)  eurodollar time
deposits having a maturity of less than 270 days from the date of acquisition
thereof purchased directly from any Permitted Bank;

 

(h)  bankers’
acceptances eligible for rediscount under requirements of the Board of
Governors of the Federal Reserve System and accepted by Permitted Banks; and

 

(i)  obligations of the
type described in clauses (a) through (e) above purchased from a
securities dealer designated as a “primary dealer” by the Federal Reserve Bank
of New York or from a Permitted Bank as counterparty to a written repurchase
agreement obligating such counterparty to repurchase such obligations not

 

15

 

later than 14 days after the
purchase thereof and which provides that the obligations which are the subject
thereof are held for the benefit of the Partnership or a Restricted Subsidiary
by a custodian which is a Permitted Bank and which is not a counterparty to the
repurchase agreement in question;

 

(2)           the acquisition by the Partnership or any Restricted
Subsidiary of Capital Stock or other ownership interests, whether in a single
transaction or in a series of related transactions, of a Person located in the
United States, Mexico or Canada and engaged in substantially the same business
as the Partnership such that, upon the completion of such transaction or series
of transactions, the Person becomes a Restricted Subsidiary;

 

(3)           any Investment by the Partnership or any Restricted
Subsidiary in a Person, if as a result of such Investment:

 

(a)   such Person becomes a Restricted Subsidiary; or

 

(b)   such Person is merged, consolidated or amalgamated with or into,
or transfers or conveys substantially all of its properties or assets to, or is
liquidated into, the Partnership or a Restricted Subsidiary;

 

(4)           the making or ownership by the Partnership or any
Restricted Subsidiary of Investments (in addition to any other Permitted
Investments) in any Person incorporated or otherwise formed pursuant to the
laws of the United States, Mexico or Canada or any state thereof which is
engaged in the United States, Mexico or Canada; provided, that the aggregate amount of all such Investments
made by the Partnership and its Restricted Subsidiaries following the date of
this Indenture and outstanding pursuant to this third clause shall not at any
date of determination exceed 7.5% of Total Assets;

 

(5)           the making or ownership by the Partnership or any
Restricted Subsidiary of Investments:

 

(a)  arising out of
loans and advances to employees incurred in the ordinary course of business;

 

(b)  arising out of
extensions of trade credit or advances to third parties in the ordinary course
of business; or

 

(c)  acquired by reason
of the exercise of customary creditors’ rights upon default or pursuant to the
bankruptcy, insolvency or reorganization of a debtor;

 

(6)           the creation or incurrence of liability by the Partnership
or any Restricted Subsidiary, with respect to any guarantee constituting an
obligation, warranty or indemnity, not guaranteeing Indebtedness of any Person,
which is undertaken or made in the ordinary course of business;

 

(7)           the creation or incurrence of liability by the Partnership
or any Restricted Subsidiary with respect to any hedging agreements or
arrangements;

 

16

 

(8)           the making by any Restricted Subsidiary of Investments in
the Partnership or another Restricted Subsidiary and the making by the
Partnership of Investments in any Restricted Subsidiary;

 

(9)           the present value, determined on the basis of the implicit
interest rate, of all basic rental obligations under all synthetic leases of
the Partnership or any Restricted Subsidiary; and

 

(10)         the creation or incurrence of liability by the Partnership
or any Restricted Subsidiary or the making or ownership by the Partnership or
any Restricted Subsidiary of Investments in any Person with respect to any
Accounts Receivable Securitization.

 

“Permitted Liens” means any of the following:

 

(1)           Liens for taxes, assessments or other governmental
charges, the payment of which is not yet due or the payment of which is being
contested in good faith by appropriate proceedings promptly initiated and
diligently conducted and as to which reserves or other appropriate provision,
if any, as shall be required by GAAP, shall have been made therefor and be
adequate in the good faith judgment of the obligor;

 

(2)           Liens of carriers, vendors, warehousemen, mechanics,
materialmen, repairmen and other like Liens incurred in the ordinary course of
business for sums not overdue for a period of more than 30 days or the payment
of which is being contested in good faith by appropriate proceedings promptly
initiated and diligently conducted and as to which reserves or other
appropriate provisions, if any, as shall be required by GAAP, shall have been
made therefor and be adequate in the good faith judgment of the obligor, in
each case:

 

(a)  not incurred or
made in connection with the borrowing of money, the obtaining of advances or
credit or the payment of the deferred purchase price of property; or

 

(b)  incurred in the
ordinary course of business securing the unpaid purchase price of property or
services constituting current accounts payable;

 

(3)           Liens, other than any Lien imposed by the Employee
Retirement Income Security Act of 1974, as may be amended from time to time,
incurred or deposits made in the ordinary course of business:

 

(a)  in connection with
workers’ compensation, unemployment insurance and other types of social
security; or

 

(b)  to secure or to
obtain letters of credit that secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, performance bonds,
purchase, construction or sales contracts and other similar obligations, in
each case not incurred or made in connection with the borrowing of money;

 

(4)           other deposits made to secure liability to insurance
carriers under insurance or self-insurance arrangements;

 

17

 

(5)           Liens securing reimbursement obligations under letters of
credit, provided in each case that such Liens cover only the title documents
and related goods and any proceeds thereof covered by the related letter of
credit;

 

(6)           any attachment or judgment Lien, unless the judgment it
secures shall not, within 60 days after the entry thereof, have been discharged
or execution thereof stayed pending appeal or review, or shall not have been
discharged within 60 days after expiration of any such stay;

 

(7)           leases or subleases granted to others, easements,
rights-of-way, restrictions and other similar charges or encumbrances, which,
in each case either are granted, entered into or created in the ordinary course
of the business of the Partnership or any Restricted Subsidiary or do not
materially impair the value or intended use of the property covered thereby;

 

(8)           Liens on property or assets of any Restricted Subsidiary
securing Indebtedness of the Restricted Subsidiary owing to the Partnership or
a Restricted Subsidiary;

 

(9)           Liens on assets of the Partnership or any Restricted
Subsidiary existing on the date of this Indenture;

 

(10)         Liens on personal property leased under leases entered into
by the Partnership or its Restricted Subsidiaries which are accounted for as
operating leases in accordance with GAAP;

 

(11)         Liens securing Indebtedness arising under an Accounts
Receivable Securitization (including the filing of any related financing
statements naming the Partnership or any Restricted Subsidiary as the debtor
thereunder in connection with the sale of accounts receivable by the
Partnership or any Restricted Subsidiary to an SPE in connection with any such
permitted Accounts Receivable Securitization);

 

(12)         Liens securing Indebtedness incurred in accordance with:

 

(a)  clauses (3) and
(6) of the definition of Permitted Indebtedness; and

 

(b)  Indebtedness
otherwise permitted to be incurred under Section 4.09 hereof to the extent
incurred:

 

(i)            to finance the making of expenditures for the improvement
or repair (to the extent the improvements and repairs may be capitalized on the
books of the Partnership and the Restricted Subsidiaries in accordance with
GAAP) of, or additions including additions by way of acquisitions of businesses
and related assets to, the assets and property of the Partnership and its
Restricted Subsidiaries; or

 

(ii)           by assumption in connection with additions including
additions by way of acquisition or capital contributions of businesses and 

 

18

 

related assets to the
property and assets of the Partnership and its Restricted Subsidiaries;

 

provided, that, in the case of
Indebtedness incurred in accordance with clauses (i) and (ii) above,
the principal amount of the Indebtedness does not exceed the lesser of the cost
to the Partnership and its Restricted Subsidiaries of the additional property
or assets and the fair market value of the additional property or assets at the
time of the acquisition thereof, as determined in good faith by an authorized
financial officer of the General Partner;

 

(13)         Liens existing on any property of any Person at the time it
becomes a Subsidiary of the Partnership, or existing at the time of acquisition
upon any property acquired by the Partnership or any Subsidiary through
purchase, merger or consolidation or otherwise, whether or not assumed by the
Partnership or the Subsidiary, or created to secure Indebtedness incurred to
pay all or any part of the purchase price (a “Purchase Money Lien”) of property
including, without limitation, Capital Stock and other securities acquired by
the Partnership or a Restricted Subsidiary; provided,
that:

 

(a)  the Lien shall be
confined solely to the item or items of property and, if required by the terms
of the instrument originally creating the Lien, other property which is an
improvement to or is acquired for use specifically in connection with the
acquired property;

 

(b)  in the case of a
Purchase Money Lien, the principal amount of the Indebtedness secured by the Purchase
Money Lien shall at no time exceed an amount equal to the lesser of:

 

(A) the cost to the
Partnership and the Restricted Subsidiaries of the property; and

 

(B) the fair market
value of the property at the time of the acquisition thereof as determined in
good faith by an authorized financial officer of the General Partner;

 

(c)  the Purchase Money
Lien shall be created not later than 360 days after the acquisition of the
property; and

 

(d)  the Lien, other
than a Purchase Money Lien, shall not have been created or assumed in
contemplation of the Person’s becoming a Subsidiary of the Partnership or the
acquisition of property by the Partnership or any Subsidiary;

 

(14)         easements, exceptions or reservations in any property of the
Partnership or any Restricted Subsidiary granted or reserved for the purpose of
pipelines, roads, the removal of oil, gas, coal or other minerals, and other
like purposes, or for the joint or common use of real property, facilities and
equipment, which are incidental to, and do not materially interfere with, the
ordinary conduct of the business of the Partnership or any Restricted
Subsidiary;

 

19

 

(15)         Liens arising from or constituting permitted encumbrances
under the agreements and instruments securing the obligations under the Credit
Agreement;

 

(16)         Liens of landlords or mortgages of landlords on fixtures and
movable property located on premises leased by the Partnership or any of its
Subsidiaries in the ordinary course of business;

 

(17)         Liens such as banker’s liens, rights of set-off or similar
rights and remedies and burdening only deposit accounts or other funds
maintained with a depository institution in the ordinary course of business;
and

 

(18)         any Lien renewing or extending any Lien permitted by clauses
(9) through (13) and (15) above; provided,
that, the principal amount of the Indebtedness secured by any such Lien shall
not exceed the principal amount of the Indebtedness outstanding immediately
prior to the renewal or extension of the Lien, and no assets encumbered by the
Lien other than the assets encumbered immediately prior to the renewal or
extension shall be encumbered thereby.

 

“Permitted Refinancing Indebtedness” means
Indebtedness incurred by the Partnership or any Restricted Subsidiary to
substantially and concurrently (excluding any notice period on redemptions)
repay, refund, renew, replace, extend or refinance, in whole or in part, any
Permitted Indebtedness of the Partnership or any Restricted Subsidiary or any
other Indebtedness incurred by the Partnership or any Restricted Subsidiary
pursuant to Section 4.09, to the extent:

 

(1)           the principal amount of the Permitted Refinancing
Indebtedness does not exceed the principal or accreted amount plus the amount
of accrued and unpaid interest of the Indebtedness so repaid, refunded,
renewed, replaced, extended or refinanced (plus the amount of all expenses and
premiums incurred in connection therewith);

 

(2)           with respect to the repayment, refunding, renewal,
replacement, extension or refinancing of the Issuers’ Indebtedness, the
Permitted Refinancing Indebtedness ranks no more favorably in right of payment
with respect to the Notes than the Indebtedness so repaid, refunded, renewed,
replaced, extended or refinanced; and

 

(3)           with respect to the repayment, refunding, renewal,
replacement, extension or refinancing of the Issuers’ Indebtedness, the
Permitted Refinancing Indebtedness has a Weighted Average Life to Stated
Maturity and stated maturity equal to, or greater than, and has no fixed
mandatory redemption or sinking fund requirement in an amount greater than or
at a time prior to the amounts set forth in, the Indebtedness so repaid,
refunded, renewed, replaced, extended or refinanced;

 

provided, however, that Permitted Refinancing
Indebtedness shall not include Indebtedness incurred by a Restricted Subsidiary
to repay, refund, renew, replace, extend or refinance Indebtedness of the
Partnership.

 

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

 

20

 

“Preferred Stock,” as applied to the
Capital Stock of any Person, means Capital Stock of any class or classes
(however designated), which is preferred as to the payment of distributions,
dividends, or upon any voluntary or involuntary liquidation or dissolution of
such Person, over shares or units of Capital Stock of any other class of such
Person; provided, that any
limited partnership interest of the Partnership will not be considered
Preferred Stock.

 

“Principal” means James E. Ferrell.

 

“Private Placement Legend” means the legend set forth
in Section 2.06(g)(1) hereof to be placed on all Notes issued under
this Indenture except where otherwise permitted by the provisions of this
Indenture.

 

“QIB” means a “qualified institutional buyer” as
defined in Rule 144A.

 

“Redeemable Capital Stock” means any shares of any
class or series of Capital Stock, that, either by the terms thereof, by the
terms of any security into which it is convertible or exchangeable or by
contract or otherwise, is or upon the happening of an event or passage of time
would be, required to be redeemed prior to the stated maturity of the principal
of the Notes or is redeemable at the option of the holder thereof at any time
prior to the stated maturity of the principal of the Notes, or is convertible
into or exchangeable for debt securities at any time prior to the stated
maturity of the principal of the Notes.

 

“Registration Rights Agreement” means the
Registration Rights Agreement, dated as of November 24, 2010, among the
Ferrellgas, L.P., Finance Corp. and the Initial Purchasers, as such agreement
may be amended, modified or supplemented from time to time.

 

“Regulation S” means Regulation S
promulgated under the Securities Act.

 

“Regulation S Global Note” means a Regulation S
Temporary Global Note or Regulation S Permanent Global Note, as appropriate.

 

“Regulation S Permanent Global Note” means a
permanent Global Note in the form of Exhibit A1 hereto bearing the Global
Note Legend and the Private Placement Legend and deposited with or on behalf of
and registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Regulation S
Temporary Global Note upon expiration of the Restricted Period.

 

“Regulation S Temporary Global Note” means a
temporary Global Note in the form of Exhibit A2 hereto deposited with or
on behalf of and registered in the name of the Depositary or its nominee,
issued in a denomination equal to the outstanding principal amount of the Notes
initially sold in reliance on Rule 903 of Regulation S.

 

“Related Party” means any of the following:

 

(1)           any immediate family member or lineal descendant of the
Principal;

 

(2)           any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially holding
an 80% or more 

 

21

 

controlling interest of
which consist of any one or more Principals and/or such other Persons referred
to in the immediately preceding clause (1);

 

(3)           the Ferrell Companies, Inc. Employee Stock Ownership
Trust (“FCI ESOT”);

 

(4)           any participant in the FCI ESOT whose account has been
allocated shares of Ferrell Companies, Inc.;

 

(5)           Ferrell Companies, Inc.; or

 

(6)           any Subsidiary of Ferrell Companies, Inc.

 

“Responsible Officer,” when used with
respect to the Trustee, means any officer within the corporate trust department
of the Trustee (or any successor group of the Trustee) or any other officer of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.

 

“Restricted Period” means the 40-day
distribution compliance period as defined in Regulation S.

 

“Restricted Subsidiary” means a Subsidiary of the
Partnership, which, as of the date of determination, is not an Unrestricted
Subsidiary of the Partnership.

 

“Rule 144” means Rule 144
promulgated under the Securities Act.

 

“Rule 144A” means Rule 144A
promulgated under the Securities Act.

 

“Rule 903” means Rule 903
promulgated under the Securities Act.

 

“Rule 904” means Rule 904
promulgated under the Securities Act.

 

“SEC” means the Securities and Exchange
Commission.

 

“Securities Act” means the Securities Act of
1933, as amended.

 

“Shelf Registration Statement” means the
Shelf Registration Statement as defined in the Registration Rights Agreement.

 

“Significant Subsidiary” means any Subsidiary that
would be a “significant subsidiary” as defined in Article 1, Rule 1—02
of Regulation S—X, promulgated pursuant to the Securities Act, as such
Regulation is in effect on the date of this Indenture.

 

“SPE” means any special purpose Unrestricted
Subsidiary established in connection with any Accounts Receivable
Securitization.

 

“Subsidiary” means, with respect to any
specified Person:

 

22

 

(1)           any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital Stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees of the corporation, association or
other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and

 

(2)           any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are that Person or one or more
Subsidiaries of that Person (or any combination thereof).

 

“Termination Capital Transactions” means any
sale, transfer or other disposition of property of the Partnership occurring
upon or incident to the liquidation and winding up of the Partnership.

 

“TIA” means the Trust Indenture Act of 1939 (15
U.S.C. §§ 77aaa-77bbbb) as in effect on the date on which this Indenture
is qualified under the TIA, except as provided in Section 9.03 hereof.

 

“Total Assets” means, as of any date of
determination, the consolidated total assets of the Partnership and the
Restricted Subsidiaries as would be shown on a consolidated balance sheet of
the Partnership and the Restricted Subsidiaries prepared in accordance with GAAP
as of that date.

 

“Trustee” means the party named as such in
the preamble to this Indenture until a successor replaces it in accordance with
the applicable provisions of this Indenture and thereafter means the successor
serving hereunder.

 

“Unrestricted Global Note” means a permanent global
Note substantially in the form of Exhibit A attached hereto that bears the
Global Note Legend and that has the “Schedule of Exchanges of Interests in the
Global Note” attached thereto, and that is deposited with or on behalf of and
registered in the name of the Depositary.

 

“Unrestricted Definitive Note” means one or
more Definitive Notes.

 

“Unrestricted Subsidiary” means (a) Ferrellgas
Receivables, LLC, (b) Uni-Asia, Ltd., (c) Ferrellgas Real Estate, Inc.,
(d) Blue Rhino Canada, Inc., and (e) any other Person (other
than Finance Corp.) that is designated as such by the General Partner; provided, that no portion of the
Indebtedness of such Person:

 

(1)           is guaranteed by the Partnership or any Restricted
Subsidiary;

 

(2)           is recourse to or obligates the Partnership or any
Restricted Subsidiary in any way; or

 

(3)           subjects any property or assets of the Partnership or any
Restricted Subsidiary, directly or indirectly, contingently or otherwise, to
the satisfaction thereof.

 

23

 

Notwithstanding
the foregoing, the Partnership or a Restricted Subsidiary may guarantee or
agree to provide funds for the payment or maintenance of, or otherwise become
liable with respect to Indebtedness of an Unrestricted Subsidiary, but only to
the extent that the Partnership or a Restricted Subsidiary would be permitted
to:

 

(1)           make an Investment in the Unrestricted Subsidiary pursuant
to the third clause of the definition of Permitted Investments; and

 

(2)           incur the Indebtedness represented by the guarantee or
agreement pursuant to Section 4.09(a) hereto. The Board of Directors
may designate an Unrestricted Subsidiary to be a Restricted Subsidiary;
provided, that immediately after giving effect to the designation there exists
no Event of Default or event which after notice or lapse or time or both would
become an Event of Default, and if the Unrestricted Subsidiary has, as of the
date of the designation, outstanding Indebtedness other than Permitted Indebtedness,
the Partnership could incur at least $1.00 of Indebtedness other than Permitted
Indebtedness.

 

Notwithstanding
the foregoing, no Subsidiary may be designated an Unrestricted Subsidiary if
the Subsidiary, directly or indirectly, holds Capital Stock of a Restricted
Subsidiary.

 

“U.S. Person” means a U.S. Person as
defined in Rule 902(k) under the Securities Act.

 

“Voting Stock” of any Person as of any
date means the Capital Stock of such Person that is at the time entitled to
vote in the election of the Board of Directors of such Person.

 

“Weighted Average Life to Stated Maturity” means, when
applied to any Indebtedness at any date, the number of years obtained by
dividing:

 

(1)           the sum of the products obtained by
multiplying:

 

(a)  the amount of each
then remaining installment, sinking fund, serial maturity or other required
payments of principal, including payment at final maturity, in respect thereof,
by

 

(b)  the number of
years, calculated to the nearest one-twelfth, that will elapse between such
date and the making of such payment, by

 

(2)           the then outstanding principal amount of such
Indebtedness;

 

provided, however, that with respect to any
revolving Indebtedness, the foregoing calculation of Weighted Average Life to
Stated Maturity shall be determined based upon the total available commitments
and the required reductions of commitments in lieu of the outstanding principal
amount and the required payments of principal, respectively.

 

24

 

Section 1.02                                Other
Definitions.

 

	
   

  	
   

  	
  Defined in

  
	
  Term

  	
   

  	
  Section

  
	
  “Affiliate Transaction”

  	
   

  	
  4.11

  
	
  “Asset Sale Offer”

  	
   

  	
  3.09

  
	
  “Authentication Order”

  	
   

  	
  2.02

  
	
  “Change of Control Offer”

  	
   

  	
  4.14

  
	
  “Change of Control Payment”

  	
   

  	
  4.14

  
	
  “Change of Control Payment Date”

  	
   

  	
  4.14

  
	
  “Covenant Defeasance”

  	
   

  	
  8.03

  
	
  “DTC”

  	
   

  	
  2.03

  
	
  “Event of Default”

  	
   

  	
  6.01

  
	
  “Excess Proceeds”

  	
   

  	
  4.10

  
	
  “Existing Credit Agreement”

  	
   

  	
  1.01

  
	
  “incur”

  	
   

  	
  4.09

  
	
  “Issuers”

  	
   

  	
  Preamble

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  
	
  “Offer Amount”

  	
   

  	
  3.09

  
	
  “Offer Period”

  	
   

  	
  3.09

  
	
  “Paying Agent”

  	
   

  	
  2.03

  
	
  “Permitted Indebtedness”

  	
   

  	
  4.09

  
	
  “Purchase Date”

  	
   

  	
  3.09

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Restricted Payments”

  	
   

  	
  4.07

  

 

Section 1.03                                Incorporation
by Reference of Trust Indenture Act.

 

Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture.

 

The
following TIA terms used in this Indenture have the following meanings:

 

“indenture securities” means the Notes;

 

“indenture security Holder” means a Holder of a Note;

 

“indenture to be qualified” means this Indenture;

 

“indenture trustee” or “institutional trustee” means the Trustee;
and

 

“obligor” on the Notes means the
Issuers and any successor obligor upon the Notes.

 

All
other terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule under the TIA have the
meanings so assigned to them.

 

25

 

Section 1.04                                Rules of
Construction.

 

Unless
the context otherwise requires:

 

(1)           a term has the meaning assigned to it;

 

(2)           an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;

 

(3)           “or” is not exclusive;

 

(4)           words in the singular include the plural, and in the
plural include the singular;

 

(5)           “will” shall be interpreted to express a command;

 

(6)           provisions apply to successive events and transactions;
and

 

(7)           references to sections of or rules under the Securities
Act will be deemed to include substitute, replacement of successor sections or rules adopted
by the SEC from time to time.

 

ARTICLE 2.

THE NOTES

 

Section 2.01                                Form and
Dating.

 

(a)           General. 
The Notes and the Trustee’s certificate of authentication will be
substantially in the form of Exhibit A hereto.  The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage.  Each Note will be dated the date of its
authentication.  The Notes shall be in
denominations of $2,000 and integral multiples of $1,000 in excess thereof.

 

The
terms and provisions contained in the Notes will constitute, and are hereby
expressly made, a part of this Indenture and the Issuers and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. 
However, to the extent any provision of any Note conflicts with the
express provisions of this Indenture, the provisions of this Indenture shall
govern and be controlling.

 

(b)           Global Notes.  Notes issued in global form will be
substantially in the form of Exhibit A attached hereto (including the
Global Note Legend thereon and the “Schedule of Exchanges of Interests in the
Global Note” attached thereto).  Notes
issued in definitive form will be substantially in the form of Exhibit A
attached hereto (but without the Global Note Legend thereon and without the “Schedule
of Exchanges of Interests in the Global Note” attached thereto).  Each Global Note will represent such of the
outstanding Notes as will be specified therein and each shall provide that it
represents the aggregate principal amount of outstanding Notes from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Note to reflect 

 

26

 

the amount of any increase or decrease in the
aggregate principal amount of outstanding Notes represented thereby will be
made by the Trustee or the Custodian, at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section 2.06
hereof.

 

Section 2.02                                Execution
and Authentication.

 

An
Officer must sign the Notes for the Issuers by manual or facsimile signature.

 

If
an Officer whose signature is on a Note no longer holds that office at the time
a Note is authenticated, the Note will nevertheless be valid.

 

A
Note will not be valid until authenticated by the manual or facsimile signature
of the Trustee.  The signature will be
conclusive evidence that the Note has been authenticated under this Indenture.

 

On
the date of this Indenture, the Trustee shall, upon a written order of the
Issuers signed by an Officer (an “Authentication
Order”), authenticate the Initial Notes for original issue up to
$500,000,000 in aggregate principal amount and, upon delivery of any
Authentication Order at any time and from time to time thereafter, the Trustee
shall authenticate Additional Notes for original issue in an aggregate
principal amount specified in such Authentication Order.

 

The
Trustee may appoint an authenticating agent acceptable to the Issuers to
authenticate Notes.  An authenticating
agent may authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights
as an Agent to deal with Holders or an Affiliate of the Issuers.

 

Section 2.03                                Registrar
and Paying Agent.

 

The
Issuers will maintain an office or agency where Notes may be presented for
registration of transfer or for exchange (“Registrar”)
and an office or agency where Notes may be presented for payment (“Paying Agent”).  The Registrar will keep a register of the
Notes and of their transfer and exchange. 
The Issuers may appoint one or more co-registrars and one or more
additional paying agents.  The term “Registrar”
includes any co-registrar and the term “Paying Agent” includes any additional
paying agent.  The Issuers may change any
Paying Agent or Registrar without notice to any Holder.  The Issuers will notify the Trustee in
writing of the name and address of any Agent not a party to this
Indenture.  If the Issuers fail to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act as such.  The Partnership or
any of its Subsidiaries may act as Paying Agent or Registrar.

 

The
Issuers initially appoint The Depository Trust Company (“DTC”) to act as Depositary with respect
to the Global Notes.

 

The
Issuers initially appoint the Trustee to act as the Registrar and Paying Agent
and to act as Custodian with respect to the Global Notes.

 

27

 

Section 2.04                                Paying
Agent to Hold Money in Trust.

 

The
Issuers will require each Paying Agent other than the Trustee to agree in
writing that the Paying Agent will hold in trust for the benefit of Holders or
the Trustee all money held by the Paying Agent for the payment of principal,
premium or interest on the Notes, and will notify the Trustee of any default by
the Issuers in making any such payment. 
While any such default continues, the Trustee may require a Paying Agent
to pay all money held by it to the Trustee. 
The Issuers at any time may require a Paying Agent to pay all money held
by it to the Trustee.  Upon payment over
to the Trustee, the Paying Agent (if other than the Issuers or a Subsidiary)
will have no further liability for the money. 
If the Partnership or a Subsidiary acts as Paying Agent, it will
segregate and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent.  Upon
any bankruptcy or reorganization proceedings relating to the Issuers, the
Trustee will serve as Paying Agent for the Notes.

 

Section 2.05                                Holder
Lists.

 

The
Trustee will preserve in as current a form as is reasonably practicable the
most recent list available to it of the names and addresses of all Holders and
shall otherwise comply with TIA § 312(a). 
If the Trustee is not the Registrar, the Issuers will furnish to the
Trustee at least seven Business Days before each interest payment date and at
such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and
addresses of the Holders of Notes and the Issuers shall otherwise comply with
TIA § 312(a).

 

Section 2.06                                Transfer
and Exchange.

 

(a)           Transfer and Exchange of Global Notes.  A Global Note may not be transferred except
as a whole by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.  All Global
Notes will be exchanged by the Issuers for Definitive Notes if:

 

(1)           the Issuers deliver to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and,
in either case, a successor Depositary is not appointed by the Issuers within
120 days after the date of such notice from the Depositary;

 

(2)           the Issuers in their sole discretion determine that the
Global Notes (in whole but not in part) should be exchanged for Definitive
Notes and delivers a written notice to such effect to the Trustee; provided that in no event shall the
Regulation S Temporary Global Note be exchanged by the Issuers for Definitive
Notes prior to (A) the expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under
the Securities Act; or

 

(3)           there has occurred and is continuing a Default or Event of
Default with respect to the Notes.

 

28

 

Upon
the occurrence of either of the preceding events in (1) or (2) above,
Definitive Notes shall be issued in such names as the Depositary shall instruct
the Trustee.  Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof.  Every Note authenticated
and delivered in exchange for, or in lieu of, a Global Note or any portion
thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10
hereof, shall be authenticated and delivered in the form of, and shall be, a
Global Note.  A Global Note may not be
exchanged for another Note other than as provided in this Section 2.06(a),
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b), (c) or (f) hereof.

 

(b)           Transfer and Exchange of Beneficial Interests in the
Global Notes.  The transfer
and exchange of beneficial interests in the Global Notes will be effected
through the Depositary, in accordance with the provisions of this Indenture and
the Applicable Procedures.  Beneficial
interests in the Restricted Global Notes will be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act.  Transfers of beneficial interests
in the Global Notes also will require compliance with either subparagraph (1) or
(2) below, as applicable, as well as one or more of the other following
subparagraphs, as applicable:

 

(1)           Transfer of Beneficial
Interests in the Same Global Note. 
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in the
same Restricted Global Note in accordance with the transfer restrictions set
forth in the Private Placement Legend; provided,
however, that prior to the expiration of the Restricted Period,
transfers of beneficial interests in the Regulation S Temporary  Global Note may not be made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser).  Beneficial interests in any
Unrestricted Global Note may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note.  No written orders or instructions
shall be required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b)(1).

 

(2)           All Other Transfers and
Exchanges of Beneficial Interests in Global Notes.  In connection with all transfers and
exchanges of beneficial interests that are not subject to Section 2.06(b)(1) above,
the transferor of such beneficial interest must deliver to the Registrar
either:

 

(A) both:

 

(i)            a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an amount equal to the beneficial
interest to be transferred or exchanged; and

 

(ii)           instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to be
credited with such increase; or

 

(B) both:

 

29

 

(i)            a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to cause to be issued a Definitive Note in
an amount equal to the beneficial interest to be transferred or exchanged; and

 

(ii)           instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such Definitive Note
shall be registered to effect the transfer or exchange referred to in (1) above;

 

provided that in no event shall
Definitive Notes be issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior to (A) the
expiration of the Restricted Period and (B) the receipt by the Registrar
of any certificates required pursuant to Rule 903 under the Securities
Act.

 

Upon
consummation of an Exchange Offer, if any, by the Issuers in accordance with Section 2.06(f) hereof,
the requirements of this Section 2.06(b)(2) shall be deemed to have
been satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial interests
in the Restricted Global Notes.  Upon
satisfaction of all of the requirements for transfer or exchange of beneficial
interests in Global Notes contained in this Indenture and the Notes or
otherwise applicable under the Securities Act, the Trustee shall adjust the
principal amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof.

 

(3)           Transfer of Beneficial
Interests to Another Restricted Global Note.  A beneficial interest in any Restricted
Global Note may be transferred to a Person who takes delivery thereof in the
form of a beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:

 

(A) if the transferee
will take delivery in the form of a beneficial interest in the 144A Global
Note, then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof;

 

(B) if the transferee
will take delivery in the form of a beneficial interest in the Regulation S
Temporary Global Note or the Regulation S Permanent Global Note, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof; and

 

(C) if the transferee
will take delivery in the form of a beneficial interest in the IAI Global Note,
then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.

 

(4)           Transfer and Exchange
of Beneficial Interests in a Restricted Global Note for Beneficial Interests in
an Unrestricted Global Note. 
A beneficial interest in any Restricted Global Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in 

 

30

 

the form of a beneficial
interest in an Unrestricted Global Note if the exchange or transfer complies
with the requirements of Section 2.06(b)(2) above and:

 

(A) such exchange or
transfer is effected pursuant to any Exchange Offer in accordance with the
Registration Rights Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution of the
Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;

 

(B) such transfer is
effected pursuant to the Shelf Registration Statement in accordance with the Registration
Rights Agreement;

 

(C) such transfer is
effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)            if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item (1)(a) thereof;
or

 

(ii)           if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person who shall
take delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;

 

and,
in each such case set forth in this subparagraph (D), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.

 

If
any such transfer is effected pursuant to subparagraph (B) or (D) above
at a time when an Unrestricted Global Note has not yet been issued, the Issuers
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.

 

Beneficial
interests in an Unrestricted Global Note cannot be exchanged for, or
transferred to Persons who take delivery thereof in the form of, a beneficial
interest in a Restricted Global Note.

 

31

 

(c)           Transfer or Exchange of Beneficial Interests for
Definitive Notes.

 

(1)           Beneficial Interests in
Restricted Global Notes to Restricted Definitive Notes.  If any holder of a beneficial interest in a
Restricted Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:

 

(A) if the holder of
such beneficial interest in a Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note, a certificate from such
holder in the form of Exhibit C hereto, including the certifications in
item (2)(a) thereof;

 

(B) if such beneficial
interest is being transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;

 

(C) if such beneficial
interest is being transferred to a Non-U.S. Person in an offshore transaction
in accordance with Rule 903 or Rule 904, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item (2) thereof;

 

(D) if such beneficial
interest is being transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;

 

(E) if such beneficial
interest is being transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable;

 

(F) if such beneficial
interest is being transferred to the Issuers or any of their Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or

 

(G) if such beneficial
interest is being transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof,

 

the
Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Issuers shall execute and the Trustee shall authenticate and deliver to
the Person designated in the instructions a Definitive Note in the appropriate
principal amount.  Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c) shall be registered in such name or
names and in such authorized denomination or denominations as the holder of 

 

32

 

such
beneficial interest shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. 
The Trustee shall deliver such Definitive Notes to the Persons in whose
names such Notes are so registered.  Any
Definitive Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c)(1) shall bear the
Private Placement Legend and shall be subject to all restrictions on transfer
contained therein.

 

(2)           Beneficial Interests in
Regulation S Temporary Global Note to Definitive Notes.  Notwithstanding Sections 2.06(c)(1)(A) and
(C) hereof, a beneficial interest in the Regulation S Temporary Global
Note may not be exchanged for a Definitive Note or transferred to a Person who
takes delivery thereof in the form of a Definitive Note prior to (A) the
expiration of the Restricted Period and (B) the receipt by the Registrar
of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under
the Securities Act, except in the case of a transfer pursuant to an exemption
from the registration requirements of the Securities Act other than Rule 903
or Rule 904.

 

(3)           Beneficial Interests in
Restricted Global Notes to Unrestricted Definitive Notes.  A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest to a
Person who takes delivery thereof in the form of an Unrestricted Definitive
Note only if:

 

(A) such exchange or
transfer is effected pursuant to the Exchange Offer, if any, in accordance with
the Registration Rights Agreement and the holder of such beneficial interest,
in the case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution of the
Exchange Notes or (iii) a Person who is an affiliate (as defined in Rule 144)
of the Issuers;

 

(B) such transfer is
effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) such transfer is
effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)            if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for an Unrestricted
Definitive Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(b) thereof; or

 

(ii)           if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person who shall
take delivery thereof in the form of an Unrestricted Definitive Note, a
certificate from such holder in the form of Exhibit B hereto, including
the certifications in item (4) thereof;

 

33

 

and,
in each such case set forth in this subparagraph (D), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.

 

(4)           Beneficial Interests in
Unrestricted Global Notes to Unrestricted Definitive Notes.  If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, then, upon satisfaction of
the conditions set forth in Section 2.06(b)(2) hereof, the Trustee
will cause the aggregate principal amount of the applicable Global Note to be
reduced accordingly pursuant to Section 2.06(h) hereof, and the
Issuers will execute and the Trustee will authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate principal
amount.  Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will
be registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest requests through
instructions to the Registrar from or through the Depositary and the
Participant or Indirect Participant.  The
Trustee will deliver such Definitive Notes to the Persons in whose names such
Notes are so registered.  Any Definitive
Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(4) will
not bear the Private Placement Legend.

 

(d)           Transfer and Exchange of Definitive Notes for
Beneficial Interests.

 

(1)           Restricted Definitive
Notes to Beneficial Interests in Restricted Global Notes.  If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a Restricted Global
Note or to transfer such Restricted Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Restricted Global
Note, then, upon receipt by the Registrar of the following documentation:

 

(A) if the Holder of
such Restricted Definitive Note proposes to exchange such Note for a beneficial
interest in a Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item (2)(b) thereof;

 

(B) if such Restricted
Definitive Note is being transferred to a QIB in accordance with Rule 144A,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;

 

(C) if such Restricted
Definitive Note is being transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or Rule 904, a certificate to
the effect set forth in Exhibit B hereto, including the certifications in
item (2) thereof;

 

34

 

(D) if such Restricted
Definitive Note is being transferred pursuant to an exemption from the
registration requirements of the Securities Act in accordance with Rule 144,
a certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;

 

(E) if such Restricted
Definitive Note is being transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof,
if applicable;

 

(F) if such Restricted
Definitive Note is being transferred to the Issuers or any of their
Subsidiaries, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or

 

(G) if such Restricted
Definitive Note is being transferred pursuant to an effective registration
statement under the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof,

 

the
Trustee will cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above,
the 144A Global Note, in the case of clause (C) above, the Regulation S
Global Note, and in all other cases, the IAI Global Note.

 

(2)           Restricted Definitive
Notes to Beneficial Interests in Unrestricted Global Notes.  A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Restricted Definitive Note to a Person who takes delivery thereof
in the form of a beneficial interest in an Unrestricted Global Note only if:

 

(A) such exchange or
transfer is effected pursuant to the Exchange Offer, if any, in accordance with
the Registration Rights Agreement and the Holder, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a
Person participating in the distribution of the Exchange Notes or (iii) a
Person who is an affiliate (as defined in Rule 144) of the Issuers;

 

(B) such transfer is
effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) such transfer is
effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

35

 

(i)            if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted Global Note,
a certificate from such Holder in the form of Exhibit C hereto, including
the certifications in item (1)(c) thereof; or

 

(ii)           if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof in the form of
a beneficial interest in the Unrestricted Global Note, a certificate from such
Holder in the form of Exhibit B hereto, including the certifications in
item (4) thereof;

 

and,
in each such case set forth in this subparagraph (D), if the Registrar so
requests or if the Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act.

 

Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(2), the Trustee will cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.

 

(3)           Unrestricted Definitive
Notes to Beneficial Interests in Unrestricted Global Notes.  A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note at any time.  Upon receipt of a request for such an
exchange or transfer, the Trustee will cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the aggregate principal
amount of one of the Unrestricted Global Notes.

 

If any such exchange or transfer from a Definitive Note to a beneficial
interest is effected pursuant to subparagraphs (2)(B), (2)(D) or (3) above
at a time when an Unrestricted Global Note has not yet been issued, the Issuers
will issue and, upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee will authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the principal amount of Definitive Notes
so transferred.

 

(e)           Transfer and Exchange of Definitive Notes for
Definitive Notes.  Upon
request by a Holder of Definitive Notes and such Holder’s compliance with the
provisions of this Section 2.06(e), the Registrar will register the
transfer or exchange of Definitive Notes. 
Prior to such registration of transfer or exchange, the requesting
Holder must present or surrender to the Registrar the Definitive Notes duly
endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Registrar duly executed by such Holder or by its attorney,
duly authorized in writing.  In addition,
the requesting Holder must provide any additional certifications, documents and
information, as applicable, required pursuant to the following provisions of
this Section 2.06(e).

 

36

 

(1)           Restricted Definitive
Notes to Restricted Definitive Notes.  Any Restricted Definitive Note may be
transferred to and registered in the name of Persons who take delivery thereof
in the form of a Restricted Definitive Note if the Registrar receives the
following:

 

(A) if the transfer
will be made pursuant to Rule 144A, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the certifications
in item (1) thereof;

 

(B) if the transfer
will be made pursuant to Rule 903 or Rule 904, then the transferor
must deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and

 

(C) if the transfer
will be made pursuant to any other exemption from the registration requirements
of the Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable.

 

(2)           Restricted Definitive
Notes to Unrestricted Definitive Notes.  Any Restricted Definitive Note may be
exchanged by the Holder thereof for an Unrestricted Definitive Note or
transferred to a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:

 

(A) such exchange or
transfer is effected pursuant to the Exchange Offer, if any, in accordance with
the Registration Rights Agreement and the Holder, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in the applicable
Letter of Transmittal that it is not (i) a Broker-Dealer, (ii) a
Person participating in the distribution of the Exchange Notes or (iii) a
Person who is an affiliate (as defined in Rule 144) of the Issuers;

 

(B) any such transfer
is effected pursuant to the Shelf Registration Statement in accordance with the
Registration Rights Agreement;

 

(C) any such transfer
is effected by a Broker-Dealer pursuant to any Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or

 

(D) the Registrar
receives the following:

 

(i)            if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit C hereto, including
the certifications in item (1)(d) thereof; or

 

(ii)           if the Holder of such Restricted Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof in the form
of an Unrestricted Definitive Note, a certificate from such Holder in 

 

37

 

the form of Exhibit B
hereto, including the certifications in item (4) thereof;

 

and,
in each such case set forth in this subparagraph (D), if the Registrar so
requests, an Opinion of Counsel in form reasonably acceptable to the Registrar
to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.

 

(3)           Unrestricted Definitive
Notes to Unrestricted Definitive Notes.  A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note.  Upon
receipt of a request to register such a transfer, the Registrar shall register
the Unrestricted Definitive Notes pursuant to the instructions from the Holder
thereof.

 

(f)            Exchange Offer.  Upon the occurrence of the Exchange Offer, if
any, in accordance with the Registration Rights Agreement, the Issuers will
issue and, upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee will authenticate:

 

(1)           one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial interests in
the Restricted Global Notes accepted for exchange in the Exchange Offer by
Persons that certify in the applicable Letters of Transmittal that (A) they
are not Broker-Dealers, (B) they are not participating in a distribution
of the Exchange Notes and (C) they are not affiliates (as defined in Rule 144)
of the Issuers; and

 

(2)           Unrestricted Definitive Notes in an aggregate principal
amount equal to the principal amount of the Restricted Definitive Notes
accepted for exchange in the Exchange Offer by Persons that certify in the
applicable Letters of Transmittal that (A) they are not Broker-Dealers, (B) they
are not participating in a distribution of the Exchange Notes and (C) they
are not affiliates (as defined in Rule 144) of the Issuers.

 

Concurrently
with the issuance of such Notes, the Trustee will cause the aggregate principal
amount of the applicable Restricted Global Notes to be reduced accordingly, and
the Issuers will execute and the Trustee will authenticate and deliver to the
Persons designated by the Holders of Definitive Notes so accepted Unrestricted
Definitive Notes in the appropriate principal amount.

 

(g)           Legends. 
The following legends will appear on the face of all Global Notes and
Definitive Notes issued under this Indenture unless specifically stated
otherwise in the applicable provisions of this Indenture.

 

(1)           Private Placement
Legend.

 

(A) Except as permitted
by subparagraph (B) below, each Global Note and each Definitive Note (and
all Notes issued in exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:

 

38

 

“THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE
HEREOF, AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
THE DATE WHICH IS ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION
TERMINATION DATE”), EXCEPT THAT THE NOTES MAY BE TRANSFERRED (A) TO
THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
NOTES ENDORSED THEREON ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (E) TO
AN INSTITUTIONAL “ACCREDITED INVESTOR” (AS DEFINED IN RULE 501(A)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES AND, IF
SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUERS THAT SUCH TRANSFER IS
IN COMPLIANCE WITH THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER (1) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY
DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR PURSUANT TO CLAUSE (F) PRIOR TO THE RESALE RESTRICTION
TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (2) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.”

 

(B) Notwithstanding the
foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs
(b)(4), (c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3) 

 

39

 

or (f) of this Section 2.06 (and all Notes
issued in exchange therefor or substitution thereof) will not bear the Private
Placement Legend.

 

(2)           Global Note Legend.  Each Global Note will bear a legend in
substantially the following form:

 

“THIS
GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING
THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS
HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT
THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR
WRITTEN CONSENT OF THE ISSUERS.

 

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.  UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55
WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

 

(3)           Regulation S Temporary
Global Note Legend.  The
Regulation S Temporary Global Note will bear a Legend in substantially the
following form:

 

“THE
RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS
AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED
IN THE INDENTURE (AS DEFINED HEREIN). 
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S
TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.”

 

(4)           Tax Legend.  With respect to any Additional Notes issued
with original issue discount for U.S. federal income tax purposes, each Global
Note and each Definitive Note shall bear a legend in substantially the
following form:

 

40

 

“THIS
NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273 AND
1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.  YOU MAY CONTACT THE CHIEF FINANCIAL
OFFICER OF FERRELLGAS, L.P., 7500 COLLEGE BOULEVARD, SUITE 1000, OVERLAND PARK,
KANSAS 66210, WHO WILL PROVIDE YOU WITH THE ISSUE PRICE, THE AMOUNT OF ORIGINAL
ISSUE DISCOUNT, THE ISSUE DATE, AND THE YIELD TO MATURITY OF THE NOTE.”

 

(h)           Cancellation and/or Adjustment of Global Notes.  At such time as all beneficial interests in a
particular Global Note have been exchanged for Definitive Notes or a particular
Global Note has been redeemed, repurchased or canceled in whole and not in
part, each such Global Note will be returned to or retained and canceled by the
Trustee in accordance with Section 2.11 hereof.  At any time prior to such cancellation, if
any beneficial interest in a Global Note is exchanged for or transferred to a
Person who will take delivery thereof in the form of a beneficial interest in
another Global Note or for Definitive Notes, the principal amount of Notes
represented by such Global Note will be reduced accordingly and an endorsement
will be made on such Global Note by the Trustee or by the Depositary at the
direction of the Trustee to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note,
such other Global Note will be increased accordingly and an endorsement will be
made on such Global Note by the Trustee or by the Depositary at the direction
of the Trustee to reflect such increase.

 

(i)            General Provisions Relating to Transfers and
Exchanges.

 

(1)           To permit registrations of transfers and exchanges, the
Issuers will execute and the Trustee will authenticate Global Notes and
Definitive Notes upon receipt of an Authentication Order in accordance with Section 2.02
hereof or at the Registrar’s request.

 

(2)           No service charge will be made to a Holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Issuers may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer taxes or similar
governmental charge payable upon exchange or transfer pursuant to Sections
2.10, 3.06, 3.09, 4.10, 4.14 and 9.05 hereof).

 

(3)           The Registrar will not be required to register the
transfer of or exchange of any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part.

 

(4)           All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes will
be the valid obligations of the Issuers, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Global Notes or Definitive
Notes surrendered upon such registration of transfer or exchange.

 

(5)           Neither the Registrar nor the Issuers will be required:

 

41

 

(A) to issue, to
register the transfer of or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business
on the day of selection;

 

(B) to register the
transfer of or to exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part; or

 

(C) to register the
transfer of or to exchange a Note between a record date and the next succeeding
interest payment date.

 

(6)           Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Issuers may deem and treat
the Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on such
Notes and for all other purposes, and none of the Trustee, any Agent or the
Issuers shall be affected by notice to the contrary.

 

(7)           The Trustee will authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.

 

All
certifications, certificates and Opinions of Counsel required to be submitted
to the Registrar pursuant to this Section 2.06 to effect a registration of
transfer or exchange may be submitted by facsimile.

 

Section 2.07                                Replacement
Notes.

 

If
any mutilated Note is surrendered to the Trustee or the Issuers and the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, the Issuers will issue and the Trustee, upon receipt of an Authentication
Order, will authenticate a replacement Note if the Trustee’s requirements are
met.  An indemnity bond must be supplied
by the Holder that is sufficient in the judgment of the Trustee and the Issuers
to protect the Issuers, the Trustee, any Agent and any authenticating agent
from any loss that any of them may suffer if a Note is replaced.  The Issuers may charge for their expenses in
replacing a Note.

 

Every
replacement Note is an additional obligation of the Issuers and will be
entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.

 

Section 2.08                                Outstanding
Notes.

 

The
Notes outstanding at any time are all the Notes authenticated by the Trustee
except for those canceled by it, those delivered to it for cancellation, those
reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section as
not outstanding.  Except as set forth in Section 2.09
hereof, a Note does not cease to be outstanding because the Issuers or an
Affiliate of the Issuers holds the Note; however, Notes held by the Issuers or
a Subsidiary of the Issuers shall not be deemed to be outstanding for purposes
of Section 2.08 hereof.

 

42

 

If
a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a protected purchaser.

 

If
the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.

 

If
the Paying Agent (other than the Issuers, a Subsidiary or an Affiliate of any
thereof) holds, on a redemption date or maturity date, money sufficient to pay
Notes payable on that date, then on and after that date such Notes will be
deemed to be no longer outstanding and will cease to accrue interest.

 

Section 2.09                                Treasury
Notes.

 

In
determining whether the Holders of the required principal amount of Notes have
concurred in any direction, waiver or consent, Notes owned by the Issuers, or
by any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Issuers, will be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee will be protected in relying on any such direction, waiver or consent,
only Notes that a Responsible Officer of the Trustee actually knows are so
owned will be so disregarded.

 

Section 2.10                                Temporary
Notes.

 

Until
certificates representing Notes are ready for delivery, the Issuers may prepare
and the Trustee, upon receipt of an Authentication Order, will authenticate
temporary Notes.  Temporary Notes will be
substantially in the form of certificated Notes but may have variations that
the Issuers consider appropriate for temporary Notes and as may be reasonably
acceptable to the Trustee.  Without
unreasonable delay, the Issuers will prepare and the Trustee will authenticate
definitive Notes in exchange for temporary Notes.

 

Holders
of temporary Notes will be entitled to all of the benefits of this Indenture.

 

Section 2.11                                Cancellation.

 

The
Issuers at any time may deliver Notes to the Trustee for cancellation.  The Registrar and Paying Agent will forward
to the Trustee any Notes surrendered to them for registration of transfer,
exchange or payment.  The Trustee and no
one else will cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and will dispose of such
canceled Notes in accordance with its customary procedures (subject to the
record retention requirement of the Exchange Act).  The Issuers may not issue new Notes to
replace Notes that they have paid or that have been delivered to the Trustee
for cancellation.

 

Section 2.12                                Defaulted
Interest.

 

If
the Issuers default in a payment of interest on the Notes, they will pay the
defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof.  The
Issuers will notify the Trustee in writing 

 

43

 

of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment.  The Issuers will
fix or cause to be fixed each such special record date and payment date, provided that no such special record date
may be less than 10 days prior to the related payment date for such defaulted
interest.  At least 15 days before the
special record date, the Issuers (or, upon the written request of the Issuers,
the Trustee in the name and at the expense of the Issuers) will mail or cause
to be mailed to Holders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.

 

Section 2.13                                CUSIP
Numbers.

 

The
Issuers in issuing the Notes may use “CUSIP” numbers (if then generally in
use), and, if so, the Trustee shall use “CUSIP” numbers in notices of
redemption as a convenience to Holders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers.  The Issuers will promptly notify the Trustee
in writing of any change in the “CUSIP” numbers.

 

ARTICLE 3.

REDEMPTION AND PREPAYMENT

 

Section 3.01                                Notices
to Trustee.

 

If
the Issuers elect to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, they must furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers’
Certificate setting forth:

 

(1)           the clause of this Indenture pursuant to which the
redemption shall occur;

 

(2)           the redemption date;

 

(3)           the principal amount of Notes to be redeemed; and

 

(4)           the redemption price.

 

Section 3.02                                Selection
of Notes to Be Redeemed or Purchased.

 

If
less than all of the Notes are to be redeemed or purchased in an offer to
purchase at any time, the Trustee will select Notes for redemption or purchase
as follows:

 

(1)           if the Notes are listed on any national securities
exchange, in compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or

 

44

 

(2)           if the Notes are not listed on any national securities
exchange, on a pro rata basis, by
lot or in accordance with a method which the Trustee shall deem fair and
appropriate.

 

In
the event of partial redemption or purchase by lot, the particular Notes to be
redeemed or purchased will be selected, unless otherwise provided herein, not
less than 30 nor more than 60 days prior to the redemption or purchase date by
the Trustee from the outstanding Notes not previously called for redemption or
purchase.

 

The
Trustee will promptly notify the Issuers in writing of the Notes selected for
redemption or purchase and, in the case of any Note selected for partial
redemption or purchase, the principal amount thereof to be redeemed or
purchased.  Notes and portions of Notes
selected will be in amounts of $2,000 or whole multiples of $1,000 in excess
thereof; except that if all of the Notes of a Holder are to be redeemed or
purchased, the entire outstanding amount of Notes held by such Holder, even if
not a multiple of $1,000, shall be redeemed or purchased.  Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption or
purchase also apply to portions of Notes called for redemption or purchase.

 

Section 3.03                                Notice
of Redemption.

 

Subject
to the provisions of Section 3.09 hereof, at least 10 days but not more
than 60 days before a redemption date, the Issuers will mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Notes
are to be redeemed at its registered address, except that redemption notices
may be mailed more than 60 days prior to a redemption date if the notice is
issued in connection with a defeasance of the Notes or a satisfaction and
discharge of this Indenture pursuant to Articles 8 or 10 of this Indenture.

 

The
notice will identify the Notes to be redeemed (including CUSIP number(s)) and
will state:

 

(1)           the redemption date;

 

(2)           the redemption price;

 

(3)           if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount equal
to the unredeemed portion will be issued upon cancellation of the original
Note;

 

(4)           the name and address of the Paying Agent;

 

(5)           that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;

 

(6)           that, unless the Issuers default in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;

 

(7)           the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being redeemed;
and

 

45

 

(8)           that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.

 

At
the Issuers’ request, the Trustee will give the notice of redemption in the
Issuers’ name and at their expense; provided,
however, that the Issuers have delivered to the Trustee, at least 45
days prior to the redemption date, an Officers’ Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.

 

Section 3.04                                Effect
of Notice of Redemption.

 

Once
notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. 
A notice of redemption may not be conditional.

 

Section 3.05                                Deposit
of Redemption or Purchase Price.

 

One
Business Day prior to or prior to 11:00 a.m. Eastern Time on the
redemption or purchase price date, the Issuers will deposit with the Trustee or
with the Paying Agent money sufficient to pay the redemption or purchase price
of and accrued interest on all Notes to be redeemed or purchased on that
date.  The Trustee or the Paying Agent
will promptly return to the Issuers any money deposited with the Trustee or the
Paying Agent by the Issuers in excess of the amounts necessary to pay the
redemption or purchase price of, and accrued interest on, all Notes to be
redeemed or purchased.

 

If
the Issuers comply with the provisions of the preceding paragraph, on and after
the redemption or purchase date, interest will cease to accrue on the Notes or
the portions of Notes called for redemption or purchase.  If a Note is redeemed or purchased on or
after an interest record date but on or prior to the related interest payment
date, then any accrued and unpaid interest shall be paid to the Person in whose
name such Note was registered at the close of business on such record
date.  If any Note called for redemption or
purchase is not so paid upon surrender for redemption or purchase because of
the failure of the Issuers to comply with the preceding paragraph, interest
shall be paid on the unpaid principal, from the redemption or purchase date
until such principal is paid, and to the extent lawful on any interest not paid
on such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.

 

Section 3.06                                Notes
Redeemed or Purchased in Part.

 

Upon
surrender of a Note that is redeemed or purchased in part, the Issuers will
issue and, upon receipt of an Authentication Order, the Trustee will
authenticate for the Holder at the expense of the Issuers a new Note equal in
principal amount to the unredeemed or unpurchased portion of the Note
surrendered.

 

Section 3.07                                Optional
Redemption.

 

(a)           The
Notes are not redeemable at the Issuers’ option prior to May 1, 2016.

 

(b)           On
and after May 1, 2016, the Issuers may redeem the Notes, in whole or in
part, upon not less than 30 nor more than 60 days’ notice, at the redemption
prices (expressed in 

 

46

 

percentages of principal amount) listed in the table
below, plus accrued and unpaid interest on the Notes to the applicable
redemption date, if redeemed during the twelve months beginning on May 1
of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2016

  	
   

  	
  103.250

  	
  %

  
	
  2017

  	
   

  	
  102.167

  	
  %

  
	
  2018

  	
   

  	
  101.083

  	
  %

  
	
  2019 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(c)           Any
redemption pursuant to this Section 3.07 shall be made pursuant to the
provisions of Section 3.01 through 3.06 hereof.

 

Section 3.08                                Mandatory
Redemption.

 

The
Issuers are not required to make any mandatory redemption or sinking fund
payments with respect to the Notes.  The
Issuers may at any time and from time to time purchase Notes in the open market
or otherwise.

 

Section 3.09                                Offer
to Purchase by Application of Excess Proceeds.

 

In
the event that, pursuant to Section 4.10 hereof, the Issuers are required
to commence an offer to all Holders to purchase Notes (an “Asset Sale Offer”), they will follow the
procedures specified below.

 

The
Asset Sale Offer shall be made to all Holders and all holders of other
Indebtedness that is pari passu
with the Notes containing provisions similar to those set forth in this
Indenture with respect to offers to purchase or redeem with the proceeds of
sales and assets.  The Asset Sale Offer
will remain open for a period of at least 20 Business Days following its
commencement and not more than 30 Business Days, except to the extent that a
longer period is required by applicable law (the “Offer Period”).  No
later than three Business Days after the termination of the Offer Period (the “Purchase Date”), the Issuers will apply
all Excess Proceeds (the “Offer Amount”)
to the purchase of Notes and such other pari
passu Indebtedness (on a pro rata basis, if applicable) or, if less
than the Offer Amount has been tendered, all Notes and other Indebtedness
tendered in response to the Asset Sale Offer. 
Payment for any Notes so purchased will be made in the same manner as
interest payments are made.

 

If
the Purchase Date is on or after an interest record date and on or before the
related interest payment date, any accrued and unpaid interest will be paid to
the Person in whose name a Note is registered at the close of business on such
record date, and no additional interest will be payable to Holders who tender
Notes pursuant to the Asset Sale Offer.

 

Upon
the commencement of an Asset Sale Offer, the Issuers will send, by first class
mail, a notice to the Trustee and each of the Holders, with a copy to the
Trustee.  The notice will contain all
instructions and materials necessary to enable such Holders to tender Notes
pursuant to the Asset Sale Offer.  The
notice, which will govern the terms of the Asset Sale Offer, will state:

 

47

 

(1)           that the Asset Sale Offer is being made pursuant to this Section 3.09
and Section 4.10 hereof and the length of time the Asset Sale Offer will
remain open;

 

(2)           the Offer Amount, the purchase price and the Purchase
Date;

 

(3)           that any Note not tendered or accepted for payment will
continue to accrue interest;

 

(4)           that, unless the Issuers default in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer will cease to
accrue interest after the Purchase Date;

 

(5)           that Holders electing to have a Note purchased pursuant to
an Asset Sale Offer may elect to have Notes purchased only in denominations of
$2,000 and integral multiples of $1,000 in excess thereof;

 

(6)           that Holders electing to have a Note purchased pursuant to
any Asset Sale Offer will be required to surrender the Note, with the form
entitled “Option of Holder to Elect Purchase” on the reverse of the Note
completed, or transfer by book-entry transfer, to the Issuers, a Depositary, if
appointed by the Issuers, or a Paying Agent at the address specified in the
notice at least three days before the Purchase Date;

 

(7)           that Holders will be entitled to withdraw their election
if the Issuers, the Depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that such
Holder is withdrawing his election to have such Note purchased;

 

(8)           that, if the aggregate principal amount of Notes and other
pari passu Indebtedness
surrendered by Holders exceeds the Offer Amount, the Issuers will select the
Notes and other pari passu
Indebtedness to be purchased on a pro rata
basis based on the principal amount of Notes and such other pari passu Indebtedness surrendered (with
such adjustments as may be deemed appropriate by the Issuers so that only Notes
in denominations of $2,000, or integral multiples in excess thereof, will be
purchased); and

 

(9)           that Holders whose Notes were purchased only in part will
be issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).

 

On
or before the Purchase Date, the Issuers will, to the extent lawful, accept for
payment, on a pro rata basis to
the extent necessary, the Offer Amount of Notes or portions thereof tendered
pursuant to the Asset Sale Offer, or if less than the Offer Amount has been
tendered, all Notes tendered, and will deliver to the Trustee an Officers’
Certificate stating that such Notes or portions thereof were accepted for
payment by the Issuers in accordance with the terms of this Section 3.09.  The Issuers, the Depositary or the Paying
Agent, as the case may be, will promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an
amount equal to the purchase price of the Notes tendered by such Holder and
accepted by the Issuers for purchase, and the Issuers will promptly issue a new
Note, and the Trustee, 

 

48

 

upon
written request from the Issuers will authenticate and mail or deliver such new
Note to such Holder, in a principal amount equal to any unpurchased portion of
the Note surrendered.  Any Note not so
accepted shall be promptly mailed or delivered by the Issuers to the Holder
thereof.  The Issuers will publicly
announce the results of the Asset Sale Offer on the Purchase Date.

 

Other
than as specifically provided in this Section 3.09, any purchase pursuant
to this Section 3.09 shall be made pursuant to the provisions of Sections
3.01 through 3.06 hereof.

 

ARTICLE 4.

COVENANTS

 

Section 4.01                                Payment
of Notes.

 

The
Issuers will pay or cause to be paid the principal of, premium, if any, and
interest on the Notes on the dates and in the manner provided in the
Notes.  Principal, premium, if any, and
interest will be considered paid on the date due if the Paying Agent, if other
than the Issuers or a Subsidiary thereof, holds as of 10:00 a.m. Eastern
Time on the due date money deposited by the Issuers in immediately available
funds and designated for and sufficient to pay all principal, premium, if any,
and interest then due.

 

The
Issuers will pay interest (including post-petition interest in any proceeding
under any Bankruptcy Law) on overdue principal at the rate equal to 1% per
annum in excess of the then applicable interest rate on the Notes to the extent
lawful; they will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.

 

Section 4.02                                Maintenance
of Office or Agency.

 

The
Issuers will maintain in the Borough of Manhattan, the City of New York, an
office or agency (which may be an office of the Trustee or an affiliate of the
Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Issuers in respect of the Notes and this Indenture may be served.  The Issuers will give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency.  If at any time the Issuers
fail to maintain any such required office or agency or fails to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.

 

The
Issuers may also from time to time designate one or more other offices or
agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however, that no such designation
or rescission will in any manner relieve the Issuers of their obligation to
maintain an office or agency in the Borough of Manhattan, the City of New York
for such purposes.  The Issuers will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.

 

The
Issuers hereby designate the Corporate Trust Office of the Trustee as one such
office or agency of the Issuers in accordance with Section 2.03 hereof.

 

49

 

Section 4.03                                Reports.

 

(a)           Whether
or not required by the rules and regulations of the SEC, so long as any
Notes are outstanding, the Issuers will furnish to the Holders of Notes, within
the time periods specified in the SEC’s rules and regulations:

 

(1)           all quarterly and annual financial information that would
be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if
the Issuers were required to file such forms, including a “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and,
with respect to the annual financial information only, a report thereon by the
Issuers’ certified independent accountants; and

 

(2)           all current reports that would be required to be filed
with the SEC on Form 8-K if the Issuers were required to file such
reports.

 

In
addition, whether or not required by the rules and regulations of the SEC,
the Issuers will file a copy of all of the information and reports referred to
in clauses (1) and (2) above with the SEC for public availability
within the time periods specified in the SEC’s rules and regulations
(unless the SEC will not accept such a filing) and make such information
available to investors who request it in writing.  The Issuers will promptly furnish to Holders
of Notes notices of (a) any Payment Default under any instrument
evidencing Indebtedness for borrowed money, and (b) any acceleration of
such Indebtedness prior to its express maturity. The Issuers will at all times
comply with TIA § 314(a).

 

Section 4.04                                Compliance
Certificate.

 

(a)           The
Issuers shall deliver to the Trustee, within 90 days after the end of each
fiscal year, an Officers’ Certificate stating that a review of the activities
of the Issuers and their Subsidiaries during the preceding fiscal year has been
made under the supervision of the signing Officers with a view to determining
whether the Issuers has kept, observed, performed and fulfilled their
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that, to the best of his or her knowledge, the
Issuers have kept, observed, performed and fulfilled each and every covenant
contained in this Indenture and are not in default in the performance or
observance of any of the terms, provisions and conditions of this Indenture
(or, if a Default or Event of Default has occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Issuers are taking or propose to take with respect thereto) and
that, to the best of his or her knowledge, no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Issuers are taking or propose to
take with respect thereto.

 

(b)           So
long as not contrary to the then current recommendations of the American
Institute of Certified Public Accountants, the year-end financial statements
delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Issuers’ independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Issuers have violated
any provisions of Article 4 or Article 5 hereof or, if any such
violation has occurred, specifying the nature and period of 

 

50

 

existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.

 

(c)           So
long as any of the Notes are outstanding, the Issuers will deliver to the
Trustee, forthwith upon any Officer becoming aware of any Default or Event of
Default, an Officers’ Certificate specifying such Default or Event of Default
and what action the Issuers are taking or propose to take with respect thereto.

 

Section 4.05                                Taxes.

 

The
Issuers will pay, and will cause each of their Subsidiaries to pay, prior to
delinquency, all material taxes, assessments, and governmental levies except
such as are contested in good faith and by appropriate proceedings or where the
failure to effect such payment is not adverse in any material respect to the
Holders of the Notes.

 

Section 4.06                                Stay,
Extension and Usury Laws.

 

The
Issuers covenant (to the extent that they may lawfully do so) that they will
not at any time insist upon, plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay, extension or usury law wherever enacted,
now or at any time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Issuers (to the extent that they may
lawfully do so) hereby expressly waive all benefit or advantage of any such
law, and covenant that they will not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law has
been enacted.

 

Section 4.07                                Restricted
Payments.

 

(a)           The
Partnership will not, and will not permit any of its Restricted Subsidiaries
to, directly or indirectly, (all such payments and other actions set forth in
these clauses (1) through (4) below being collectively referred to as
a “Restricted Payment”):

 

(1)           declare or pay any dividend or any other distribution or
payment on or with respect to Capital Stock of the Partnership or any of its
Restricted Subsidiaries or any payment made to the direct or indirect holders,
in their capacities as such, of Capital Stock of the Partnership or any of its
Restricted Subsidiaries other than (a) dividends or distributions payable
solely in Capital Stock of the Partnership (excluding Redeemable Capital
Stock), or in options, warrants or other rights to purchase Capital Stock of
the Partnership (excluding Redeemable Capital Stock); (b) dividends or other
distributions to the extent declared or paid to the Partnership or any
Restricted Subsidiary of the Partnership; or (c) dividends or other
distributions by any Restricted Subsidiary of the Partnership to all holders of
Capital Stock of that Restricted Subsidiary on a pro rata basis, including to
the General Partner of the Partnership;

 

(2)           purchase, redeem, defease or otherwise acquire or retire
for value any Capital Stock of the Partnership or any of its Restricted
Subsidiaries, other than any Capital Stock owned the Partnership or a
Restricted Subsidiary of the Partnership;

 

51

 

(3)           make any principal payment on, or purchase, defease,
repurchase, redeem or otherwise acquire or retire for value, prior to any
scheduled maturity, scheduled repayment, scheduled sinking fund payment or
other stated maturity, any subordinated Indebtedness, other than any such
Indebtedness owned by the Partnership or a Restricted Subsidiary of the
Partnership; or

 

(4)           make any investment, other than a Permitted Investment, in
any entity,

 

unless,
at the time of and after giving effect to such Restricted Payment:

 

(1)           no Default or Event of Default has occurred and is
continuing; and

 

(2)           the Restricted Payment, together with the aggregate of all
other Restricted Payments made by the Partnership and its Restricted
Subsidiaries during the fiscal quarter during which the Restricted Payment is
made will not exceed:

 

(A) if the Consolidated
Fixed Charge Coverage Ratio of the Partnership is greater than 1.75 to 1.00, an
amount equal to Available Cash for the immediately preceding fiscal quarter; or

 

(B) if the Consolidated
Fixed Charge Coverage Ratio of the Partnership is equal to or less than 1.75 to
1.00, an amount equal to the sum of $50 million, less the aggregate amount of
all Restricted Payments made by the Partnership and its Restricted Subsidiaries
in accordance with this clause during the period ending on the last day of the
fiscal quarter of the Partnership immediately preceding the date of the
Restricted Payment and beginning on the first day of the sixteenth full fiscal
quarter immediately preceding the date of the Restricted Payment plus the
aggregate net cash proceeds of capital contributions to the Partnership from
any Person other than a Restricted Subsidiary of the Partnership, or issuance
and sale of shares of Capital Stock, other than Redeemable Capital Stock, of
the Partnership to any entity other than to a Restricted Subsidiary of the
Partnership, in any case made during the period ending on the last day of the
fiscal quarter of the Partnership immediately preceding the date of the
Restricted Payment and beginning on the first day of the sixteenth full fiscal
quarter immediately preceding the date of the Restricted Payment.

 

(b)           The
provisions of Section 4.07(a) will not prohibit:

 

(1)           the payment of any dividend or distribution within 60 days
after the date of its declaration if, at the date of declaration, the payment
would be permitted as stated above;

 

(2)           the redemption, repurchase or other acquisition or
retirement of any shares of any class of Capital Stock of the Partnership or
any Restricted Subsidiary of the Partnership in exchange for, or out of the net
cash proceeds of, a substantially concurrent capital contribution to the
Partnership from any entity other than a Restricted Subsidiary of the
Partnership; or issuance and sale of other Capital Stock, other than Redeemable
Capital Stock, of the Partnership to any entity other than to a Restricted
Subsidiary of the 

 

52

 

Partnership; provided, however, that the amount of any
net cash proceeds that are utilized for any redemption, repurchase or other
acquisition or retirement will be excluded from the calculation of Available
Cash; or

 

(3)           any redemption, repurchase or other acquisition or
retirement of subordinated Indebtedness in exchange for, or out of the net cash
proceeds of, a substantially concurrent capital contribution to the Partnership
from any entity other than a Restricted Subsidiary of the Partnership; or
issuance and sale of Indebtedness of the Partnership issued to any entity other
than a Restricted Subsidiary or the Partnership, so long as the Indebtedness is
Permitted Refinancing Indebtedness; provided,
however, that the amount of any net cash proceeds that are utilized
for any redemption, repurchase or other acquisition or retirement will be
excluded from the calculation of Available Cash.

 

In
computing the amount of Restricted Payments in Section 4.07(a) above,
the Restricted Payments permitted by clause (1) of this paragraph (b) will
be included and the Restricted Payments permitted by clauses (2) and (3) of
this paragraph (b) will not be included.

 

The
amount of all Restricted Payments (other than cash) will be the fair market
value on the date of the Restricted Payment of the assets proposed to be
transferred by the Partnership or such Restricted Subsidiary, as the case may
be, pursuant to the Restricted Payment. 
The fair market value of any assets that are required to be valued by
this Section 4.07 will be determined in good faith by an authorized
financial officer of the General Partner on the date of the Restricted Payment
of the assets proposed to be transferred.

 

Section 4.08                                Dividend
and Other Payment Restrictions Affecting Subsidiaries.

 

(a)           The
Partnership will not, and will not permit any of its Restricted Subsidiaries
to, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted Subsidiary to:

 

(1)           pay dividends, in cash or otherwise, or make any other
distributions on or with respect to its Capital Stock or any other interest or
participation in, or measured by, its profits;

 

(2)           pay any Indebtedness owed to the Partnership or any other
Restricted Subsidiary;

 

(3)           make loans or advances to, or any investment in, the
Partnership or any other Restricted Subsidiary;

 

(4)           transfer any of its properties or assets to the
Partnership or any other Restricted Subsidiary; or

 

(5)           guarantee any Indebtedness of the Partnership or any other
Restricted Subsidiary.

 

All
such restrictions and other actions set forth in these clauses (1) through
(5) above being collectively referred to as “Payment Restrictions.”

 

53

 

(b)           The
provisions of Section 4.08(a) will not apply to (and therefore the
following are permitted) encumbrances or restrictions existing under or by
reason of:

 

(1)           applicable law;

 

(2)           any agreement in effect at or entered into on the date of
this Indenture or any agreement relating to any Indebtedness permitted to be
incurred under this Indenture, or with respect to any Credit Facility
(including agreements or instruments evidencing Indebtedness incurred after the
date of this Indenture); provided, however,
that the encumbrances and restrictions contained in the agreements governing
such permitted Indebtedness are not materially more restrictive with respect to
the Payment Restrictions than those set forth in the agreements governing the
Partnership’s existing Indebtedness as in effect on the date of this Indenture;

 

(3)           customary non-assignment provisions of any contract or any
lease governing a leasehold interest of the Partnership or any Restricted
Subsidiary;

 

(4)           specific purchase money obligations or Capital Leases for
property subject to such obligations;

 

(5)           any agreement of an entity (or any it its Restricted
Subsidiaries) acquired by the Partnership or any Restricted Subsidiary, in
existence at the time of the acquisition but not created in contemplation of
the acquisition, which encumbrance or restriction is not applicable to any
third party other than the entity; or

 

(6)           provisions contained in instruments relating to
Indebtedness which prohibit the transfer of all or substantially all of the
assets of the obligor of the Indebtedness unless the transferee shall assume
the obligations of the obligor under the agreement or instrument.

 

Section 4.09                                Incurrence
of Indebtedness.

 

(a)           The
Partnership will not, and will not permit any of its Restricted Subsidiaries
to, directly or indirectly, create, incur, issue, assume, guarantee or in any
manner become directly or indirectly liable, contingently or otherwise, for the
payment, in each case, to “incur,”
any Indebtedness, unless at the time of the incurrence and after giving pro
forma effect to the receipt and application of the proceeds of the
Indebtedness, the Consolidated Fixed Charge Coverage Ratio of the Partnership
is greater than 2.00 to 1.00.

 

(b)           The
provisions of Section 4.09(a) will not prohibit the incurrence by the
Partnership and its Restricted Subsidiary of any of the following items of
Indebtedness (collectively, “Permitted
Indebtedness”):

 

(1)           Indebtedness outstanding as of the date of this Indenture;

 

(2)           Indebtedness of the Partnership or a Restricted Subsidiary
incurred for the making of expenditures for the improvement or repair, to the
extent the improvements or repairs may be capitalized in accordance with GAAP,
or additions, including by way of acquisitions of businesses and related
assets, to the property and assets of the Partnership 

 

54

 

and its Restricted
Subsidiaries, including, without limitation, the acquisition of assets subject
to operating leases, Indebtedness incurred under the Credit Facilities, or
incurred by assumption in connection with additions, including additions by way
of acquisitions or capital contributions of businesses and related assets, to
the property and assets of the Partnership and its Restricted Subsidiaries; provided, that the aggregate principal
amount of this Indebtedness outstanding at any time may not exceed $75 million;

 

(3)           Indebtedness of the Partnership or a Restricted Subsidiary
(a) incurred for any purpose permitted under the Credit Facilities, or (b) owing
in respect of any Accounts Receivable Securitization, operating lease, or other
off-balance sheet obligation existing on the date of this Indenture that arises
because, after the date of this Indenture, such off-balance sheet obligations
are refinanced with Indebtedness, provided,
that the aggregate principal amount of this Indebtedness outstanding under this
clause at any time may not exceed an amount equal to the sum of (x) $500
million plus (y) the amount, if any, by which the Borrowing Base as of the
date of calculation exceeds the amount of the Borrowing Base as of December 31,
2003;

 

(4)           Indebtedness of the Partnership owed to the General
Partner or an Affiliate of the General Partner that is unsecured and that is subordinated
in right of payment to the Notes; provided,
that the aggregate principal amount of this Indebtedness outstanding at any
time under this clause may not exceed $50 million and this Indebtedness has a
final maturity date later than the final maturity date of the Notes;

 

(5)           Indebtedness owed by the Partnership to any Restricted
Subsidiary or owed by any Restricted Subsidiary to the Partnership or to any
other Restricted Subsidiary;

 

(6)           Permitted Refinancing Indebtedness (including, for the
avoidance of doubt, Indebtedness incurred as permitted under the
Consolidated Fixed Charge Coverage Ratio set forth in Section 4.09(a) above);

 

(7)           the incurrence by the Partnership or a Restricted
Subsidiary of Indebtedness owing directly to its insurance carriers, without
duplication, in connection with the Partnership’s, its Subsidiaries’ or its
Affiliates’ self-insurance programs or other similar forms of retained
insurable risks for their respective businesses, consisting of reinsurance
agreements and indemnification agreements, and guarantees of the foregoing,
secured by letters of credit; provided,
that any Consolidated Fixed Charges associated with the Indebtedness evidenced
by the reinsurance agreements, indemnification agreements, guarantees and
letters of credit will be included, without duplication, in any determination
of the Consolidated Fixed Charge Coverage Ratio test set forth in Section 4.09(a) above;

 

(8)           Indebtedness of the Partnership and its Restricted
Subsidiaries in respect of Capital Leases, meaning, generally, any lease of any
property which would be required to be classified and accounted for as a
capital lease on a balance sheet of the lessor; provided, that the aggregate amount of this Indebtedness
outstanding at any time may not exceed $30 million;

 

55

 

(9)           Indebtedness of the Partnership and its Restricted
Subsidiaries represented by letters of credit supporting (a) obligations
under workmen’s compensation laws, (b) obligations to suppliers of propane
or energy commodity derivative providers in the ordinary course of business
consistent with past practices not to exceed $15 million at any one time
outstanding and (c) the repayment of Indebtedness permitted to be incurred
under this Indenture;

 

(10)         surety bonds and appeal bonds required in the ordinary course
of business or in connection with the enforcement of rights or claims of the
Partnership or any of its Subsidiaries or in connection with judgments that do
not result in a Default or Event of Default;

 

(11)         Indebtedness of the Partnership or its Restricted
Subsidiaries incurred in connection with acquisitions of retail propane
businesses in favor of the sellers of such businesses in an aggregate principal
amount not to exceed $20 million in any fiscal year and not to exceed $70
million at any one time outstanding; provided,
that the principal amount of such Indebtedness incurred in connection with any
such acquisition shall not exceed the fair market value of the assets so
acquired and, to the extent issued by the Partnership, such Indebtedness is
expressly subordinated to the Notes;

 

(12)         unsecured Indebtedness of the Partnership or its Restricted
Subsidiaries which is not otherwise a Permitted Indebtedness in an aggregate
outstanding amount not to exceed the greater of (a) $50 million and (b) 5%
of Consolidated Net Tangible Assets; and

 

(13)         the Notes (other than Additional Notes) and the Exchange
Notes.

 

For
purposes of determining compliance with this Section 4.09, in the event
that an item of Indebtedness meets the criteria of more than one of the categories
of Permitted Indebtedness described in clauses (1) through (13) above or
is entitled to be incurred in compliance with the Consolidated Fixed Charge
Coverage Ratio pursuant to Section 4.09(a) above, the Partnership,
may, in its sole discretion, classify (or later reclassify) in whole or in part
such items of Indebtedness in any manner that complies with this Section 4.09,
and such item of Indebtedness or a portion thereof may be classified (or later
reclassified) in whole or in part as having been incurred under more than one
of the applicable clauses of Permitted Indebtedness or in compliance with the
Consolidated Fixed Charge Coverage Ratio set forth in Section 4.09(a) above.

 

Section 4.10                                Asset
Sales.

 

The
Partnership will not, and will not permit any of its Restricted Subsidiaries
to, complete an Asset Sale unless:

 

(1)           the Partnership or its Restricted Subsidiary, as the case
may be, receives consideration at the time of such Asset Sale at least equal to
the fair market value, as determined in good faith by an authorized financial
officer of the General Partner, of the assets sold or otherwise disposed of;
and

 

56

 

(2)           if such Asset Sale involves assets with a fair market
value in excess of $10 million, at least 75% of the consideration therefor
received by the Partnership or such Restricted Subsidiary is in the form of
cash.

 

For
purposes of determining the amount of cash received in an Asset Sale, each of
the following shall be deemed to be cash:

 

(1)           the amount of any liabilities on the Partnership’s or any
Restricted Subsidiary’s balance sheet that are assumed by the transferee of the
assets; and

 

(2)           the amount of any notes or other obligations received by
the Partnership or the Restricted Subsidiary from the transferee that is
converted within 180 days by the Partnership or the Restricted Subsidiary into
cash, to the extent of the cash received.

 

Furthermore,
the 75% limitation will not apply to any Asset Sale in which the cash portion
of the consideration received is equal to or greater than the after-tax
proceeds would have been had the Asset Sale complied with the 75% limitation.

 

If
the Partnership or any of its Restricted Subsidiaries receives Net Proceeds
exceeding $20 million from one or more Asset Sales in any fiscal year, then
within 365 days after the date the aggregate amount of Net Proceeds exceeds $20
million, the Partnership or any such Restricted Subsidiary must apply the
amount of such Net Proceeds either:

 

(1)           to reduce Indebtedness of the Partnership or any of its
Restricted Subsidiaries, with a permanent reduction of availability in the case
of revolving Indebtedness; or

 

(2)           to make an investment in assets or capital expenditures
useful to the Partnership’s or any of its Subsidiaries’ business as in effect
on the date of this Indenture or business related or ancillary thereto.

 

Pending
the final application of any such Net Proceeds, the Partnership or any
Restricted Subsidiary may temporarily reduce borrowings under the Credit
Facilities or otherwise invest such Net Proceeds in any manner that is not
prohibited by this Indenture.

 

Any
Net Proceeds from Asset Sales that are not applied or invested as provided
above will be considered “Excess Proceeds.”  When the aggregate amount of Excess Proceeds
exceeds $20 million, within 15 days thereof, the Issuers will make an Asset
Sale Offer to all Holders of Notes and all holders of other Indebtedness
outstanding that is pari passu
with the Notes containing provisions similar to those set forth in this
Indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets in accordance with Section 3.09 hereof to purchase for
cash the maximum principal amount of Notes and such other pari passu Indebtedness that may be
purchased out of the Excess Proceeds. The offer price in any Asset Sale Offer
will be equal to 100% of principal amount plus accrued and unpaid interest to
the date of purchase.  To the extent that
the aggregate amount of Notes tendered in response to the Issuers’ purchase
offer is less than the Excess Proceeds, the Partnership or any Restricted
Subsidiary may use such deficiency for general business purposes.  If the aggregate principal amount of Notes
and such other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess 

 

57

 

Proceeds,
the Trustee shall select the Notes and such other pari passu Indebtedness to be purchased on pro rata basis in
proportion to the aggregate principal amount of Notes and such other pari passu Indebtedness tendered.  Upon completion of each Asset Sale Offer, the
amount of Excess Proceeds shall be reset at zero.

 

The
Issuers will comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent such
laws and regulations are applicable in connection with each repurchase of Notes
pursuant to an Asset Sale Offer.  To the
extent that the provisions of any securities laws or regulations conflict with
the provisions of Sections 3.09 or 4.10 of this Indenture, the Issuers will
comply with the applicable securities laws and regulations and will not be
deemed to have breached their obligations under those provisions of this
Indenture by virtue of such conflict.

 

Section 4.11                                Transactions
with Affiliates.

 

(a)           The
Partnership will not, and will not permit any of its Restricted Subsidiaries
to, directly or indirectly, enter into or suffer to exist any transaction or
series of related transactions, including the sale, transfer, disposition,
purchase, exchange or lease of assets, property or services, other than as
provided for in the  partnership
agreement or other organizational documents, as applicable, and the other
agreements entered into between the Partnership and any of its Affiliates,
with, or for the benefit of, any Affiliates of the Partnership (each an “Affiliate Transaction”), unless:

 

(1)           the transaction or series of related transactions are
between the Partnership and its Restricted Subsidiaries or between two
Restricted Subsidiaries; or

 

(2)           the transaction or series of related transactions are on
terms that are no less favorable to the Partnership or the Restricted
Subsidiary, as the case may be, than those which would have been obtained in a
comparable transaction at such time from an entity that is not an Affiliate of
the Partnership or Restricted Subsidiary, and, with respect to transaction(s) involving
aggregate payments or value equal to or greater than $20 million, the Partnership
delivers an Officers’ Certificate to the Trustee certifying that the
transaction(s) is on terms that are no less favorable to the Partnership
or the Restricted Subsidiary than those which would have been obtained from an
entity that is not an Affiliate of the Partnership or Restricted Subsidiary and
has been approved by a majority of the Board of Directors of the General
Partner, including a majority of the disinterested directors.

 

(b)           The
following items will not be deemed to be Affiliate Transactions and, therefore,
will not be subject to the provisions of Section 4.11(a) or otherwise
be restricted by this Indenture or the Notes:

 

(1)           any employment agreement, stock option agreement,
restricted stock agreement, employee stock ownership plan related agreements,
or similar agreement and arrangements, in the ordinary course of business;

 

(2)           transactions permitted by Section 4.07 hereof;

 

58

 

(3)           transactions in the ordinary course of business in connection
with reinsuring the self-insurance programs or other similar forms of retained
insurable risks of the retail propane business operated by the Partnership, its
Subsidiaries and Affiliates;

 

(4)           any Accounts Receivable Securitization;

 

(5)           any affiliate trading transactions done in the ordinary
course of business; and

 

(6)           any transaction that is a Flow-Through Acquisition.

 

Section 4.12                                Liens.

 

The
Partnership will not, and will not permit any of its Restricted Subsidiaries to
incur any Liens or other encumbrance, unless the Lien is a Permitted Lien or
the Notes are directly secured equally and ratably with the obligation or
liability secured by such Lien.

 

Section 4.13                                Corporate
Existence.

 

Subject
to Article 5 hereof, the Partnership shall do or cause to be done all
things necessary to preserve and keep in full force and effect:

 

(1)           its partnership existence, and the corporate, partnership
or other existence of each of its Restricted Subsidiaries, in accordance with
the respective organizational documents (as the same may be amended from time
to time) of the Partnership or any such Restricted Subsidiary; and

 

(2)           the rights (charter and statutory), licenses and
franchises of the Partnership and its Restricted Subsidiaries; provided, however, that the Partnership
shall not be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Restricted
Subsidiaries, if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the
Partnership and its Restricted Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the
Notes.

 

Section 4.14                                Offer
to Repurchase Upon Change of Control.

 

(a)           Upon
the occurrence of a Change of Control, the Issuers will make an offer (a “Change of Control Offer”) to each Holder
to repurchase, in cash, all or any part (equal to $2,000 or an integral
multiple of $1,000 in excess thereof) of that Holder’s Notes at a purchase
price equal to 101% of the aggregate principal amount of the Notes or portion
of Notes validly tendered for payment thereof plus accrued and unpaid interest
on the Notes repurchased, if any, to the date of purchase (the “Change of Control Payment”). Within 30
days following any Change of Control, the Issuers will mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and stating:

 

(1)           that the Change of Control Offer is being made pursuant to
this Section 4.14 and that all Notes tendered will be accepted for
payment;

 

59

 

(2)           the purchase price and the purchase date, which shall be
no later than 30 Business Days from the date such notice is mailed (the “Change of Control Payment Date”);

 

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

 

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

 

(5)           that Holders electing to have any Notes purchased pursuant
to a Change of Control Offer will be required to surrender the Notes, with the
form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
Payment Date;

 

(6)           that Holders will be entitled to withdraw any election to
have their Notes purchased if the Paying Agent receives, not later than the
close of business on the second Business Day preceding the Change of Control
Payment Date, a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes delivered for purchase, and a statement
that such Holder is withdrawing his election to have the Notes purchased; and

 

(7)           that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased portion
of the Notes surrendered, which unpurchased portion must be equal to $2,000 in
principal amount or an integral multiple of $1,000 in excess thereof.

 

The
Issuers will comply with the requirements of Rule 14e-1 under the Exchange
Act and any other securities laws and regulations thereunder to the extent
those laws and regulations are applicable in connection with the repurchase of
the Notes as a result of a Change in Control. 
To the extent that the provisions of any securities laws or regulations
conflict with the provisions of Sections 3.09 or 4.14 of this Indenture, the
Issuers will comply with the applicable securities laws and regulations and
will not be deemed to have breached their obligations under Section 3.09
or this Section 4.14 by virtue of such conflict.

 

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

 

(1)           accept for payment all Notes or portions thereof properly
tendered in accordance with the Change of Control Offer;

 

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

 

(3)           deliver or cause to be delivered to the Trustee the Notes
so accepted together with an Officers’ Certificate stating the aggregate
principal amount of Notes or portions of Notes being tendered to the Issuers.

 

60

 

The
Paying Agent will promptly mail to each Holder of Notes properly tendered the
Change of Control Payment for such Notes, and the Trustee will promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered, if any; provided
that each new Note will be in a principal amount of $2,000 or an integral
multiple of $2,000 in excess thereof. 
The Issuers will publicly announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment Date.

 

(c)           Notwithstanding
anything to the contrary in this Section 4.14, the Issuers will not be
required to make a Change of Control Offer upon 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 this Section 4.14
and Section 3.09 hereof and purchases all Notes properly tendered and not
withdrawn under the Change of Control Offer.

 

Section 4.15                                Limitation
on Finance Corp.

 

In
addition to the restrictions set forth under Section 4.09 hereof, Finance
Corp. will not incur any Indebtedness unless:

 

(1)           the Partnership is a co-obligor or guarantor of the
Indebtedness; or

 

(2)           the net proceeds of the Indebtedness are either lent to
the Partnership, used to acquire outstanding debt securities issued by the
Partnership, or used, directly or indirectly, to refinance or discharge
Indebtedness permitted under the limitation of this Section 4.15.

 

Finance
Corp. will not engage in any business not related, directly or indirectly, to
obtaining money or arranging financing for the Partnership.

 

ARTICLE 5.

SUCCESSORS

 

Section 5.01                                Merger,
Consolidation, or Sale of Assets.

 

The
Partnership shall not consolidate or merge with or into, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets, in one or more related transactions, to another entity
unless:

 

(1)           the Partnership is the surviving entity or the entity
formed by or surviving the transaction, if other than the Partnership, or the
entity to which the sale was made is a corporation or partnership organized or
existing under the laws of the United States, any state thereof or the District
of Columbia;

 

(2)           the entity formed by or surviving the transaction, if
other than the Partnership, or the entity to which the sale was made assumes
all the obligations of the Partnership in accordance with a supplemental
indenture in a form reasonably satisfactory to the Trustee, under the Notes and
this Indenture;

 

61

 

(3)           immediately after the transaction, no Default or Event of
Default exists; and

 

(4)           at the time of the transaction and after giving pro forma
effect to it as if the transaction had occurred at the beginning of the
applicable four-quarter period, either (a) the Partnership or such other
entity or survivor is permitted to incur at least $1.00 of additional
Indebtedness in accordance with the Consolidated Fixed Charge Coverage Ratio
described in Section 4.09(a) hereof, or (b) the Consolidated
Fixed Charge Coverage Ratio of the Partnership or such other entity or survivor
is equal to or greater than the Consolidated Fixed Charge Coverage Ratio of the
Partnership immediately before such transaction.

 

This
Section 5.01 will not apply to a sale, assignment, transfer, conveyance or
other disposition of assets between or among the Partnership and any of its
Restricted Subsidiaries.  Finance Corp.
will not consolidate or merge with or into, whether or not it is the surviving
entity, or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions to, another entity except under conditions similar to those described
in the paragraph above.

 

Section 5.02                                Successor
Corporation Substituted.

 

Upon
any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of
the Partnership or Finance Corp. in a transaction that is subject to, and that
complies with the provisions of, Section 5.01 hereof, the successor
corporation formed by such consolidation or into or with which the Partnership
or Finance Corp., as applicable, is merged or to which such sale, assignment,
transfer, lease, conveyance or other disposition is made shall succeed to, and
be substituted for (so that from and after the date of such consolidation,
merger, sale, lease, conveyance or other disposition, the provisions of this Indenture
referring to the “Partnership” or “Finance Corp.,” as applicable, shall refer
instead to the successor corporation and not to Partnership or Finance Corp.,
as applicable), and may exercise every right and power of the Partnership or
Finance Corp., as applicable, under this Indenture with the same effect as if
such successor Person had been named as the Partnership or Finance Corp., as
applicable, herein; provided, however,
that Partnership or Finance Corp., as applicable, shall not be relieved from the
obligation to pay the principal of and interest on the Notes except in the case
of a sale of all of assets of the Partnership or Finance Corp., as applicable,
in a transaction that is subject to, and that complies with the provisions of, Section 5.01
hereof.

 

ARTICLE 6.

DEFAULTS AND REMEDIES

 

Section 6.01                                Events
of Default.

 

Each
of the following is an “Event of Default”:

 

(1)           default in the payment of the principal of or premium, if
any, on any Note when the same becomes due and payable, upon stated maturity,
acceleration, optional redemption, required purchase, scheduled principal
payment or otherwise;

 

62

 

(2)           default in the payment of an installment of interest on
any of the Notes, when the same becomes due and payable, which default
continues for a period of 30 days;

 

(3)           failure to perform or observe any other term, covenant or
agreement contained in the Notes or this Indenture, other than a default
specified in either Section 6.01(1) or (2) above, and the
default continues for a period of 45 days after written notice of the default
requiring the Issuers to remedy the same will have been given to the
Partnership by the Trustee or to the Issuers and the Trustee by Holders of at
least 25% in aggregate principal amount of the Notes then outstanding;

 

(4)           default or defaults under one or more agreements,
instruments, mortgages, bonds, debentures or other evidences of Indebtedness
under which the Partnership or any Restricted Subsidiary of the Partnership
then has outstanding Indebtedness in excess of $25 million, if the default:

 

(a)  is caused by a
failure to pay principal of or premium, if any, or interest on to such
Indebtedness within the applicable grace period, if any, provided with respect
to such Indebtedness; or

 

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

 

(5)           a final judgment or judgments, which is or are
non-appealable and non-reviewable or which has or have not been stayed pending
appeal or review or as to which all rights to appeal or review have expired or
been exhausted, shall be rendered against the Partnership, any Restricted
Subsidiary, or the General Partner provided such judgment or judgments requires
or require the payment of money in excess of $25 million in the aggregate and
is not covered by insurance or discharged or stayed pending appeal or review
within 60 days after entry of such judgment; in the event of a stay, the
judgment shall not be discharged within 30 days after the stay expires;

 

(6)           the Issuers or any of their Significant Subsidiaries
pursuant to or within the meaning of Bankruptcy Law:

 

(A) commences a
voluntary case,

 

(B) consents to the
entry of an order for relief against it in an involuntary case,

 

(C) consents to the
appointment of a custodian of it or for all or substantially all of its
property,

 

(D) makes a general
assignment for the benefit of its creditors, or

 

(E) generally is not
paying its debts as they become due; or

 

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

 

63

 

(A) is for relief
against the Issuers or any of their Significant Subsidiaries in an involuntary
case;

 

(B) appoints a
custodian of the Issuers or any of their Significant Subsidiaries or for all or
substantially all of the property of the Issuers or any of their Significant
Subsidiaries; or

 

(C) orders the
liquidation of the Issuers or any of their Significant Subsidiaries;

 

and
the order or decree remains unstayed and in effect for 60 consecutive days.

 

Section 6.02                                Acceleration.

 

In
the case of an Event of Default specified in clause (6) or (7) of Section 6.01
hereof, with respect to the Partnership, Finance Corp. or any Significant
Subsidiary, all outstanding Notes will become due and payable immediately
without further action or notice.  If any
other Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the applicable series of Notes then
outstanding may declare all the Notes of that series to be due and payable
immediately.

 

Upon
any such declaration, the Notes shall become due and payable immediately.  The Holders of a majority in aggregate
principal amount of a series of Notes issued under this Indenture and then
outstanding by notice to the Trustee may on behalf of all of the Holders of
that series rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium that has become
due solely because of the acceleration) have been cured or waived.

 

If
an Event of Default by reason of any action (or inaction) taken (or not taken)
by or on behalf of the Issuers with the willful intention of avoiding payment
of the premium that the Issuers would have had to pay if the Issuers then had
elected to redeem the Notes pursuant to Section 3.07 hereof, then, upon
acceleration of the Notes, an equivalent premium shall also become and be immediately
due and payable, to the extent permitted by law, anything in this Indenture or
in the Notes to the contrary notwithstanding.

 

Section 6.03                                Other
Remedies.

 

If
an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.

 

The
Trustee may maintain a proceeding even if it does not possess any of the Notes
or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any
Holder of a Note in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. 
All remedies are cumulative to the extent permitted by law.

 

64

 

Section 6.04                                Waiver
of Past Defaults.

 

Holders
of not less than a majority in aggregate principal amount of a series of Notes
issued under this Indenture and then outstanding by notice to the Trustee for
those Notes may on behalf of the Holders of the Notes of that series waive any
existing Default or Event of Default and its consequences hereunder, except a
continuing Default or Event of Default in the payment of the principal of,
premium, if any, or interest on, the Notes; provided,
however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration.  Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.

 

Section 6.05                                Control
by Majority.

 

Holders
of a majority in principal amount of the then outstanding Notes may direct the
time, method and place of conducting any proceeding for exercising any remedy
available to the Trustee of that series of Notes or exercising any trust or
power conferred on it.  However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture that the Trustee determines may be unduly prejudicial to the rights
of other Holders of Notes or that may subject the Trustee to personal
liability.

 

Section 6.06                                Limitation on Suits.

 

A
Holder of a Note may pursue a remedy with respect to this Indenture or the
Notes only if:

 

(1)           the Holder of a Note gives to the Trustee written notice
of a continuing Event of Default;

 

(2)           the Holders of at least 25% in principal amount of the
then outstanding Notes make a written request to the Trustee to pursue the
remedy;

 

(3)           such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;

 

(4)           the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and

 

(5)           during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.

 

A
Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note (it being understood that the Trustee does not have an affirmative duty to
ascertain whether or not such actions or forbearances are unduly prejudicial to
such Holders).

 

65

 

Section 6.07                                Rights
of Holders of Notes to Receive Payment.

 

Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal, premium, if any, and interest on the Note, on or
after the respective due dates expressed in the Note (including in connection
with an offer to purchase), or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.

 

Section 6.08                                Collection
Suit by Trustee.

 

If
an Event of Default specified in Section 6.01(1) or (2) occurs
and is continuing, the Trustee is authorized to recover judgment in its own
name and as trustee of an express trust against the Issuers for the whole
amount of principal of, premium, if any, and interest remaining unpaid on the
Notes and interest on overdue principal and, to the extent lawful, interest and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

 

Section 6.09                                Trustee
May File Proofs of Claim.

 

The
Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the
Issuers (or any other obligor upon the Notes), their creditors or their
property and shall be entitled and empowered to collect, receive and distribute
any money or other property payable or deliverable on any such claims and any
custodian in any such judicial proceeding is hereby authorized by each Holder
to make such payments to the Trustee, and in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.07 hereof.  To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07
hereof out of the estate in any such proceeding, shall be denied for any
reason, payment of the same shall be secured by a Lien on, and shall be paid
out of, any and all distributions, dividends, money, securities and other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.  Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.

 

Section 6.10                                Priorities.

 

If
the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:

 

66

 

First:      to the Trustee, its agents and attorneys for amounts due under Section 7.07
hereof, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;

 

Second:  to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes for
principal, premium, if any and interest, respectively; and

 

Third:     to the Issuers or to such party as a court of competent
jurisdiction shall direct.

 

The
Trustee may fix a record date and payment date for any payment to Holders of
Notes pursuant to this Section 6.10.

 

Section 6.11                                Undertaking
for Costs.

 

In
any suit for the enforcement of any right or remedy under this Indenture or in
any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in
its discretion may assess reasonable costs, including reasonable attorneys’
fees and expenses, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party
litigant.  This Section 6.11 does
not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to Section 6.07
hereof, or a suit by Holders of more than 10% in principal amount of the then
outstanding Notes.

 

ARTICLE 7.

TRUSTEE

 

Section 7.01                                Duties
of Trustee.

 

(a)           If
an Event of Default has occurred and is continuing, the Trustee will exercise
such of the rights and powers vested in it by this Indenture, and, in the
exercise of its power, use the same degree of care and skill in its exercise,
as a prudent person would exercise or use under the circumstances in the
conduct of such person’s own affairs.

 

(b)           Except
during the continuance of an Event of Default:

 

(1)           the duties of the Trustee will be determined solely by the
express provisions of this Indenture and the Trustee need perform only those
duties that are specifically set forth in this Indenture and no others, and no
implied covenants or obligations shall be read into this Indenture against the
Trustee; and

 

(2)           in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates
or opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee will 

 

67

 

examine the certificates and
opinions to determine whether or not they conform to the requirements of this
Indenture.

 

(c)           The
Trustee may not be relieved from liabilities for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:

 

(1)           this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;

 

(2)           the Trustee will not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and

 

(3)           the Trustee will not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 6.05 hereof.

 

(d)           Whether
or not therein expressly so provided, every provision of this Indenture that in
any way relates to the Trustee is subject to paragraphs (a), (b), and (c) of
this Section 7.01.

 

(e)           No
provision of this Indenture will require the Trustee to expend or risk its own
funds or incur any liability.  The
Trustee will be under no obligation to exercise any of its rights and powers
under this Indenture at the request of any Holders, unless such Holder has
offered to the Trustee security and indemnity satisfactory to it against any
loss, liability or expense.

 

(f)            The
Trustee will not be liable for interest on any money received by it except as
the Trustee may agree in writing with the Issuers.  Money held in trust by the Trustee need not
be segregated from other funds except to the extent required by law.

 

Section 7.02                                Rights
of Trustee.

 

(a)           The
Trustee may conclusively rely upon any document believed by it to be genuine
and to have been signed or presented by the proper Person.  The Trustee need not investigate any fact or
matter stated in the document.

 

(b)           Before
the Trustee acts or refrains from acting, it may require an Officers’
Certificate or an Opinion of Counsel or both. 
The Trustee will not be liable for any action it takes or omits to take
in good faith in reliance on such Officers’ Certificate or Opinion of
Counsel.  The Trustee may consult with
counsel and the written opinion or advice of such counsel or any Opinion of
Counsel will be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.

 

(c)           The
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
Indebtedness or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into 

 

68

 

such facts or matters as it may see fit and shall
incur no liability or additional liability of any kind by reason of such
inquiry or investigation.

 

(d)           Except
with respect to Section 4.01 hereof, the Trustee shall have no duty to
inquire as to the performance of the Issuers’ covenants in Article 4
hereof.  In addition, the Trustee shall
not be deemed to have knowledge of any Default or Event of Default except (i) any
Event of Default occurring pursuant to Sections 6.01(1), 6.01(2) and 4.01
hereof or (ii) any Default or Event of Default of which the Trustee shall
have received written notification in the manner set forth in this Indenture or
an Officer in the Corporate Trust Office of the Trustee shall have obtained
actual knowledge.  Delivery of reports,
information and documents to the Trustee under Section 4.03 is for
informational purposes only and the Trustee’s receipt of the foregoing shall
not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Issuers’
compliance with any of their covenants thereunder (as to which the Trustee is
entitled to rely exclusively on an Officers’ Certificate.)

 

(e)           The
Trustee may act through its attorneys and agents and will not be responsible
for the misconduct or negligence of any agent appointed with due care.

 

(f)            The
Trustee will not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within the rights or powers
conferred upon it by this Indenture.

 

(g)           Unless
otherwise specifically provided in this Indenture, any demand, request,
direction or notice from the Issuers will be sufficient if signed by an Officer
of the Issuers.

 

(h)           The
Trustee will be under no obligation to exercise any of the rights or powers
vested in it by this Indenture at the request or direction of any of the
Holders unless such Holders have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities that might be incurred by
it in compliance with such request or direction.

 

(i)            In no event shall the Trustee be
responsible or liable for special, indirect, punitive or consequential loss or
damage of any kind whatsoever (including, but not limited to, loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of such
loss or damage and regardless of the form of action.

 

(j)            The rights, privileges, protections,
immunities and benefits given to the Trustee, including, without limitation,
its right to be indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and each agent, custodian and
other Person employed to act hereunder.

 

(k)           The Trustee shall not be required to
give any bond or surety in respect of the performance of its powers and duties
hereunder.

 

(l)            The Trustee may request that the
Issuers deliver a certificate setting forth the names of individuals and/or
titles of officers authorized at such time to take specified actions pursuant
to this Indenture.

 

69

 

Section 7.03                                Individual
Rights of Trustee.

 

The
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuers or any Affiliate of the
Issuers with the same rights it would have if it were not Trustee.  However, in the event that the Trustee
acquires any conflicting interest it must eliminate such conflict within 90
days, apply to the SEC for permission to continue as trustee or resign.  Any Agent may do the same with like rights
and duties.  The Trustee is also subject
to Sections 7.10 and 7.11 hereof.

 

Section 7.04                                Trustee’s
Disclaimer.

 

The
Trustee will not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuers’ use of the proceeds from the Notes or any money
paid to the Issuers or upon the Issuers’ direction under any provision of this
Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will not be
responsible for any statement or recital herein or any statement in the Notes
or any other document in connection with the sale of the Notes or pursuant to
this Indenture other than its certificate of authentication.

 

Section 7.05                                Notice
of Defaults.

 

If
a Default or Event of Default occurs and is continuing and if it is known to
the Trustee, the Trustee will mail to Holders of Notes a notice of the Default
or Event of Default within 90 days after it occurs.  Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on any Note,
the Trustee may withhold the notice if the Trustee determines in good faith
determines that withholding the notice is in the interests of the Holders of
the Notes.

 

Section 7.06                                Reports
by Trustee to Holders of the Notes.

 

(a)           Within
60 days after each May 15 beginning with the May 15 following the
date of this Indenture, and for so long as Notes remain outstanding, the
Trustee will mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA § 313(a) (but if no event
described in TIA § 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted).  The Trustee also will comply with TIA
§ 313(b)(2).  The Trustee will also
transmit by mail all reports as required by TIA § 313(c).

 

(b)           A
copy of each report at the time of its mailing to the Holders of Notes will be
mailed by the Trustee to the Issuers and filed by the Trustee with the SEC and
each stock exchange on which the Notes are listed in accordance with TIA
§ 313(d).  The Issuers will promptly
notify the Trustee in writing when the Notes are listed on any stock exchange
and of any delisting thereof.

 

Section 7.07                                Compensation
and Indemnity.

 

(a)           The
Issuers will pay to the Trustee from time to time such compensation as shall be
agreed in writing between the Trustee and the Issuers for its acceptance of
this Indenture and services hereunder. 
The Trustee’s compensation will not be limited by any law on
compensation 

 

70

 

of a trustee of an express trust.  The Issuers will reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred
or made by it in addition to the compensation for its services. Such expenses
will include the reasonable compensation, disbursements and expenses of the
Trustee’s agents and counsel.

 

(b)           The
Issuers will indemnify the Trustee against any and all losses, liabilities or
expenses incurred by it arising out of or in connection with the acceptance or
administration of its duties under this Indenture, including the costs and expenses
of enforcing this Indenture against the Issuers (including this Section 7.07)
and defending itself against any claim (whether asserted by the Issuers or any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its negligence or bad
faith.  The Trustee will notify the
Issuers promptly of any claim for which it may seek indemnity.  Failure by the Trustee to so notify the
Issuers will not relieve the Issuers of their obligations hereunder.  The Issuers will defend the claim and the
Trustee will cooperate in the defense. 
The Trustee may have separate counsel and the Issuers will pay the
reasonable fees and expenses of such counsel. 
The Issuers need not pay for any settlement made without its consent,
which consent will not be unreasonably withheld.

 

(c)           The
obligations of the Issuers under this Section 7.07 will survive the
satisfaction and discharge of this Indenture.

 

(d)           To
secure the Issuers’ payment obligations in this Section 7.07, the Trustee
will have a claim prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on particular
Notes.  Such claim will survive the
satisfaction and discharge of this Indenture.

 

(e)           When
the Trustee incurs expenses or renders services after an Event of Default
specified in Section 6.01(6) or 6.01(7) hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.

 

(f)            The
Trustee will comply with the provisions of TIA § 313(b)(2) to the
extent applicable.

 

Section 7.08                                Replacement
of Trustee.

 

(a)           A
resignation or removal of the Trustee and appointment of a successor Trustee
will become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section 7.08.

 

(b)           The
Trustee may resign in writing at any time and be discharged from the trust
hereby created by so notifying the Issuers. 
The Holders of a majority in principal amount of the then outstanding
Notes may remove the Trustee by so notifying the Trustee and the Issuers in
writing.  The Issuers may remove the
Trustee if:

 

(1)           the Trustee fails to comply with Section 7.10 hereof;

 

71

 

(2)           the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;

 

(3)           a custodian or public officer takes charge of the Trustee
or its property; or

 

(4)           the Trustee becomes incapable of acting.

 

(c)           If
the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Issuers will promptly appoint a successor
Trustee.  Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount
of the then outstanding Notes may appoint a successor Trustee to replace the
successor Trustee appointed by the Issuers.

 

(d)           If
a successor Trustee does not take office within 60 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Issuers, or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition, at the expense of the Issuers, any court of competent jurisdiction
for the appointment of a successor Trustee.

 

(e)           If
the Trustee, after written request by any Holder who has been a Holder for at
least six months, fails to comply with Section 7.10, such Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.

 

(f)            A
successor Trustee will deliver a written acceptance of its appointment to the
retiring Trustee and to the Issuers. 
Thereupon, the resignation or removal of the retiring Trustee will
become effective, and the successor Trustee will have all the rights, powers
and duties of the Trustee under this Indenture. 
The successor Trustee will mail a notice of its succession to
Holders.  The retiring Trustee will
promptly transfer all property held by it as Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the claim provided for in Section 7.07
hereof.  Notwithstanding replacement of
the Trustee pursuant to this Section 7.08, the Issuers’ obligations under Section 7.07
hereof will continue for the benefit of the retiring Trustee.

 

Section 7.09                                Successor
Trustee by Merger, etc.

 

If
the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act will be the successor Trustee.

 

Section 7.10                                Eligibility;
Disqualification.

 

There
will at all times be a Trustee hereunder that is a corporation organized and
doing business under the laws of the United States of America or of any state
thereof that is authorized under such laws to exercise corporate trustee power,
that is subject to supervision or examination by federal or state authorities
and that has a combined capital and surplus of at least $50 million as set
forth in its most recent published annual report of condition.

 

This
Indenture will always have a Trustee who satisfies the requirements of TIA
§ 310(a)(1), (2) and (5).  The
Trustee is subject to TIA § 310(b).

 

72

 

Section 7.11                                Preferential
Collection of Claims Against the Issuers.

 

The
Trustee is subject to TIA § 311(a), excluding any creditor relationship
listed in TIA § 311(b).  A Trustee
who has resigned or been removed shall be subject to TIA § 311(a) to
the extent indicated therein.

 

ARTICLE 8.

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

 

Section 8.01                                Option
to Effect Legal Defeasance or Covenant Defeasance.

 

The
Issuers may, at the option of the Board of Directors of the General Partner, on
the Issuers’ behalf, and the Board of Directors of Finance Corp., and at any
time, elect to have Section 8.02 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.  The Issuers may, at their option and at any
time, elect to have Section 8.03 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.

 

Section 8.02                                Legal
Defeasance and Discharge.

 

Upon
the Issuers’ exercise under Section 8.01 hereof of the option applicable
to this Section 8.02, the Issuers will, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from their obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means that
the Issuers will be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Notes, which will thereafter be deemed to be “outstanding”
only for the purposes of Section 8.05 hereof and the other Sections of this
Indenture referred to in clauses (1) and (2) below, and to have
satisfied all their other obligations under such Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Issuers, shall execute
proper instruments acknowledging the same), except for the following provisions
which will survive until otherwise terminated or discharged hereunder:

 

(1)           the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, or interest or premium, if any, on
such Notes when such payments are due from the trust referred to in Section 8.04
hereof;

 

(2)           the Issuers’ obligations with respect to the Notes
concerning issuing temporary Notes, registration of Notes or mutilated,
destroyed, lost or stolen Notes under Article 2;

 

(3)           the Issuers’ obligation to maintain an office or agency
for payment under Section 4.02 hereof and money for security payments held
in trust;

 

(4)           the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Issuers’ obligations in connection therewith; and

 

(5)           the legal defeasance and covenant defeasance provisions of
this Article 8.

 

73

 

Subject
to compliance with this Article 8, the Issuers may exercise their option
under this Section 8.02 notwithstanding the prior exercise of their option
under Section 8.03 hereof.

 

Section 8.03                                Covenant
Defeasance.

 

Upon
the Issuers’ exercise under Section 8.01 hereof of the option applicable
to this Section 8.03, the Issuers will, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be released from each of
their obligations under the covenants contained in Sections 4.07, 4.08, 4.09,
4.10, 4.11, 4.12, 4.14 and 4.15 hereof and clause (4) of Section 5.01
hereof with respect to the outstanding Notes on and after the date the
conditions set forth in Section 8.04 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the Notes will
thereafter be deemed not “outstanding” for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but will continue to be deemed “outstanding”
for all other purposes hereunder (it being understood that such Notes will not
be deemed outstanding for accounting purposes). 
For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Issuers may omit to comply with and will 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 will not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and
such Notes will be unaffected thereby. 
In addition, upon the Issuers’ exercise under Section 8.01 hereof
of the option applicable to this Section 8.03 hereof, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Section 6.01(3) hereof
will not constitute an Event of Default.

 

Section 8.04                                Conditions
to Legal or Covenant Defeasance.

 

In
order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.02
or 8.03 hereof:

 

(1)           the Issuers must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such amounts
as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if any, and
interest on the outstanding Notes on the stated maturity date for payment
thereof or on the applicable redemption date, as the case may be;

 

(2)           the Issuers will deliver to the Trustee an Opinion of
Counsel stating that:

 

(a)  after the 91st day following the deposit the trust funds will
not be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally, and all
conditions precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with and confirming other matters;

 

(b)  in the case of an
election under Section 8.02 hereof, that the Issuers have received from,
or there has been published by, the Internal Revenue Service a 

 

74

 

ruling, or since the date of this Indenture, there
shall have been a change in the applicable federal income tax law, in either
case to the effect that, and based thereon, the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income tax purposes
as a result of such Legal Defeasance and will 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; and

 

(c)  in the case of an
election under Section 8.03 hereof, that the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income tax purposes
as a result of such Covenant Defeasance and will 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 Covenant Defeasance had not occurred;

 

(3)           the Issuers must deliver to the Trustee an Officers’
Certificate stating that the deposit was not made by the Issuers with the
intent of preferring the Holders of Notes over the other creditors of the
Issuers or with the intent of defeating, hindering, delaying or defrauding any
other creditors of the Issuers;

 

(4)           no Event of Default shall have occurred and be continuing
on the date of such deposit or insofar as Events of Default described in Section 6.01(6) or
6.01(7) hereof are concerned, at any time in the period ending on the 91st day after the date of deposit; and

 

(5)           such Legal Defeasance or Covenant Defeasance will not
result in a breach, violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which the Issuers or any
of their Restricted Subsidiaries is a party or by which the Issuers or any of
their Restricted Subsidiaries is bound.

 

Section 8.05                                Deposited
Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions.

 

Subject
to Section 8.06 hereof, all money and non-callable Government Securities
(including the proceeds thereof) deposited with the Trustee (or other qualifying
trustee, collectively for purposes of this Section 8.05, the “Trustee”)
pursuant to Section 8.04 hereof in respect of the outstanding Notes will
be held in trust and applied by the Trustee, in accordance with the provisions
of such Notes and this Indenture, to the payment, either directly or through
any Paying Agent (including the Issuers or any of their Restricted Subsidiaries
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.

 

The
Issuers will pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the cash or non-callable Government Securities
deposited pursuant to Section 8.04 hereof or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the outstanding Notes.

 

75

 

Notwithstanding
anything in this Article 8 to the contrary, the Trustee will deliver or
pay to the Issuers from time to time upon the written request of the Issuers
any money or non-callable Government Securities held by it as provided in Section 8.04
hereof which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to
the Trustee (which may be the opinion delivered under Section 8.04(1) hereof),
are in excess of the amount thereof that would then be required to be deposited
to effect an equivalent Legal Defeasance or Covenant Defeasance.

 

Section 8.06                                Repayment
to the Issuers.

 

Any
money deposited with the Trustee or any Paying Agent, or then held by the
Issuers, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such
principal, premium, if any, or interest has become due and payable shall be
paid to the Issuers on their request or (if then held by the Issuers) will be
discharged from such trust; and the Holder of such Note will thereafter be
permitted to look only to the Issuers for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all liability
of the Issuers as trustee thereof, will thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, shall at
the expense of the Issuers cause to be published once, in the New York Times
and The Wall Street Journal (national edition), notice that such money remains
unclaimed and that, after a date specified therein, which will not be less than
30 days from the date of such notification or publication, any unclaimed
balance of such money then remaining will be repaid to the Issuers.

 

Section 8.07                                Reinstatement.

 

If
the Trustee or Paying Agent is unable to apply any United States dollars or
non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers’ obligations under this Indenture and the Notes
will be revived and reinstated as though no deposit had occurred pursuant to Section 8.02
or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with Section 8.02 or 8.03 hereof, as
the case may be; provided, however,
that, if the Issuers make any payment of principal of, premium, if any, or
interest on any Note following the reinstatement of its obligations, the
Issuers will be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.

 

ARTICLE 9.

AMENDMENT, SUPPLEMENT AND WAIVER

 

Section 9.01                                Without
Consent of Holders of Notes.

 

Notwithstanding
Section 9.02 of this Indenture, the Issuers and the Trustee may amend or
supplement this Indenture or the Notes without the consent of any Holder of a
Note to:

 

(1)           cure any ambiguity, defect or inconsistency;

 

76

 

(2)           provide for uncertificated Notes in addition to or in
place of certificated Notes;

 

(3)           provide for the assumption of the Issuers’ obligations to
Holders of Notes in the case of a merger or consolidation;

 

(4)           make any change that could provide any additional rights
or benefits to the Holders of Notes that does not adversely affect the legal
rights under this Indenture of any such Holder;

 

(5)           comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA; or

 

(6)           to provide security for or add guarantees with respect to
the Notes.

 

Upon
the request of the Partnership accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section 9.06
hereof, the Trustee will join with the Issuers in the execution of any amended
or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee will not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.

 

Section 9.02                                With
Consent of Holders of Notes.

 

Except
as provided below in this Section 9.02, the Issuers and the Trustee may
amend or supplement this Indenture (including, without limitation, Sections
3.09, 4.10 and 4.14 hereof) and the Notes with the 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 tender offer or
exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof,
any existing Default or Event of Default (other than a continuing Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on the Notes, except a payment default resulting from an acceleration
that has been rescinded) may be waived for all Holders of Notes of a series and
its consequences under this Indenture with the consent of the Holders of a majority
in aggregate principal amount of that series of Notes (including Additional
Notes, if any) issued under this Indenture and then outstanding (including,
without limitation, consents obtained in connection with a tender offer or
exchange offer for the Notes), by notice to the Trustee.  Section 2.08 hereof shall determine
which Notes are considered to be “outstanding” for purposes of this Section 9.02.

 

Upon
the request of the Partnership accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt
by the Trustee of the documents described in Section 9.06 hereof, the
Trustee will join with the Issuers in the execution of such amended or
supplemental Indenture unless such amended or supplemental Indenture directly
affects the Trustee’s own rights, duties 

 

77

 

or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but will not be obligated to, enter into such amended or
supplemental Indenture.

 

It
is not be necessary for the consent of the Holders of Notes under this Section 9.02
to approve the particular form of any proposed amendment or waiver, but it is
sufficient if such consent approves the substance thereof.

 

After
an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Issuers will mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver.  Any failure of the Issuers to mail such
notice, or any defect therein, will not, however, in any way impair or affect
the validity of any such amended or supplemental Indenture or waiver.  Subject to Sections 6.04 and 6.07 hereof,
with the consent of the Holders of a majority in principal amount of the Notes
(including, without limitation, Additional Notes, if any) then outstanding
(including consents obtained in connection with a tender offer or exchange
offer for Notes) may waive any existing default or compliance with any
provision of this Indenture or the Notes. 
However, without the consent of each Holder affected, an amendment or
waiver under this Section 9.02 may not (with respect to any Notes held by
a non-consenting Holder):

 

(1)           reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;

 

(2)           reduce the principal of or change the fixed maturity of
any Note or alter the provisions with respect to the redemption of the Notes
other than as provided above with respect to Sections 3.09, 4.10 and 4.14
hereof;

 

(3)           reduce the rate of or change the time for payment of
interest on any Note;

 

(4)           waive a Default in the payment of principal or interest on
the Notes;

 

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

 

(6)           make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal, premium, if any, or interest on the Notes; or

 

(7)           make any change in the foregoing amendment and waiver
provisions.

 

Section 9.03                                Compliance
with Trust Indenture Act.

 

Every
amendment or supplement to this Indenture or the Notes will be set forth in an
amended or supplemental Indenture that complies with the TIA as then in effect.

 

Section 9.04                                Revocation
and Effect of Consents.

 

Until
an amendment, supplement or waiver becomes effective, a consent to it by a
Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt
as the consenting Holder’s Note, even if notation of the consent is not made on
any Note.  However, any such Holder of a
Note or 

 

78

 

subsequent
Holder of a Note may revoke the consent as to its Note if the Trustee receives
written notice of revocation before the date the waiver, supplement or
amendment becomes effective.  An
amendment, supplement or waiver becomes effective in accordance with its terms
and thereafter binds every Holder.

 

Section 9.05                                Notation
on or Exchange of Notes.

 

The
Trustee may place an appropriate notation about an amendment, supplement or waiver
on any Note thereafter authenticated. 
The Issuers in exchange for all Notes may issue and the Trustee shall,
upon receipt of an Authentication Order, authenticate new Notes that reflect
the amendment, supplement or waiver.

 

Failure
to make the appropriate notation or issue a new Note will not affect the
validity and effect of such amendment, supplement or waiver.

 

Section 9.06                                Trustee
to Sign Amendments, etc.

 

The
Trustee will sign any amended or supplemental Indenture authorized pursuant to
this Article 9 if the amendment or supplement does not adversely affect
the rights, duties, liabilities or immunities of the Trustee.  The Partnership may not sign an amendment or
supplemental Indenture until the Board of Directors approves it.  In executing any amended or supplemental
indenture, the Trustee shall receive and (subject to Section 7.01 hereof)
will be fully protected in relying upon, in addition to the documents required
by Section 11.04 hereof, an Officers’ Certificate and an Opinion of
Counsel stating that the execution of such amended or supplemental Indenture is
authorized or permitted by this Indenture.

 

ARTICLE 10.

SATISFACTION AND DISCHARGE

 

Section 10.01                          Satisfaction
and Discharge.

 

This
Indenture will be discharged and will cease to be of further effect as to all
Notes issued hereunder, when:

 

(1)           either:

 

(a)  all Notes that
have been authenticated (except lost, stolen or destroyed Notes that have been
replaced or paid and Notes for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Issuers) have been delivered to
the Trustee for cancellation; or

 

(b)  all Notes that
have not been delivered to the Trustee for cancellation have become due and
payable by reason of the making of a notice of redemption or otherwise or will
become due and payable within one year and the Issuers has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in trust
solely for the benefit of the Holders, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient without consideration of any reinvestment of interest, to pay and
discharge the entire indebtedness on the Notes not 

 

79

 

delivered to the Trustee for cancellation for
principal, premium, if any, and accrued interest to the date of maturity or
redemption;

 

(2)           no Default or Event of Default has occurred and is
continuing on the date of such deposit or will occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Issuers are a
party or by which the Issuers are bound;

 

(3)           the Issuers  have
paid or caused to be paid all sums payable by them under this Indenture; and

 

(4)           the Issuers have delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money toward the payment of
the Notes at maturity or the redemption date, as the case may be.

 

In
addition, the Issuers must deliver an Officers’ Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction
and discharge have been satisfied.

 

Notwithstanding
the satisfaction and discharge of this Indenture, if money has been deposited
with the Trustee pursuant to subclause (b) of clause (1) of this
Section, the provisions of Section 10.02 and Section 8.06 will
survive.  In addition, nothing in this Section 10.01
will be deemed to discharge those provisions of Section 7.07 hereof, that,
by their terms, survive the satisfaction and discharge of this Indenture.

 

Section 10.02                          Application
of Trust Money.

 

Subject
to the provisions of Section 8.06, all money deposited with the Trustee
pursuant to Section 10.01 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Issuers acting as
their own Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal (and premium, if any) and interest for whose payment
such money has been deposited with the Trustee; but such money need not be
segregated from other funds except to the extent required by law.

 

If
the Trustee or Paying Agent is unable to apply any money or Government
Securities in accordance with Section 10.01 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
Issuers’ obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 10.01; provided that if the Issuers has made any
payment of principal of, premium, if any, or interest on any Notes because of
the reinstatement of their obligations, the Issuers shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money or
Government Securities held by the Trustee or Paying Agent.

 

80

 

ARTICLE 11.

MISCELLANEOUS

 

Section 11.01                          Trust
Indenture Act Controls.

 

If
any provision of this Indenture limits, qualifies or conflicts with the duties
imposed by TIA §318(c), the imposed duties will control.

 

Section 11.02                          Notices.

 

Any
notice or communication by the Issuers or the Trustee to the others is duly
given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telecopier or overnight
air courier guaranteeing next day delivery, to the others’ address:

 

If
to the Issuers:

 

Ferrellgas,
L.P.

7500 College Boulevard

Suite 1000

Overland Park, KS 66210

Telecopier No.:  (913) 661-1537

Attention:  Ryan VanWinkle

 

With
a copy to:

 

Bracewell &
Giuliani LLP

1177 Avenue of the Americas

New York, NY  10036

Telecopier No.:  (212) 938-3819

Attention:  Robin J. Miles, Esq.

 

If
to the Trustee:

 

U.S.
Bank National Association 

100 Wall Street, Suite 1600

New
York, NY  10005

Telecopier
No.:  (212) 809-5459

Attention:  Corporate Trust Services

 

The
Issuers or the Trustee, by notice to the others may designate additional or
different addresses for subsequent notices or communications.

 

All
notices and communications (other than those sent to Holders) will be deemed to
have been duly given: at the time delivered by hand, if personally delivered;
when received, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery.

 

81

 

Any
notice or communication to a Holder will be mailed by first class mail,
certified or registered, return receipt requested, or by overnight air courier
guaranteeing next day delivery to its address shown on the register kept by the
Registrar.  Any notice or communication
will also be so mailed to any Person described in TIA § 313(c), to the
extent required by the TIA.  Failure to
mail a notice or communication to a Holder or any defect in it will not affect
its sufficiency with respect to other Holders.

 

If
a notice or communication is mailed in the manner provided above within the
time prescribed, it is duly given, whether or not the addressee receives it.

 

If
the Issuers mail a notice or communication to Holders, they will mail a copy to
the Trustee and each Agent at the same time.

 

Section 11.03                          Communication
by Holders of Notes with Other Holders of Notes.

 

Holders
may communicate pursuant to TIA § 312(b) with other Holders with respect
to their rights under this Indenture or the Notes.  The Issuers, the Trustee, the Registrar and
anyone else shall have the protection of TIA § 312(c).

 

Section 11.04                          Certificate
and Opinion as to Conditions Precedent.

 

Upon
any request or application by the Issuers to the Trustee to take any action
under this Indenture, the Issuers shall furnish to the Trustee:

 

(1)           an Officers’ Certificate in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in Section 11.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and

 

(2)           an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in Section 11.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.

 

Section 11.05                          Statements
Required in Certificate or Opinion.

 

Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than a certificate provided pursuant to
TIA § 314(a)(4)) must comply with the provisions of TIA § 314(e) and
must include:

 

(1)           a statement that the Person making such certificate or
opinion has read such covenant or condition;

 

(2)           a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;

 

82

 

(3)           a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or condition
has been satisfied; and

 

(4)           a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.

 

Section 11.06                          Rules by
Trustee and Agents.

 

The
Trustee may make reasonable rules for action by or at a meeting of
Holders.  The Registrar or Paying Agent
may make reasonable rules and set reasonable requirements for its
functions.

 

Section 11.07                          Non-Recourse.

 

The
obligations of the Issuers under this Indenture are non-recourse to Ferrellgas
Partners and its Affiliates, other than the Issuers and the General Partner,
and are payable only out of the Issuers’ cash flow and assets and the cash flow
and assets of the General Partner. The Trustee agrees, and each Holder of a
Note, by accepting a Note, agrees in this Indenture that Ferrellgas Partners
and its other Affiliates will not be liable for any of the Issuers’ obligations
under this Indenture or the Notes.

 

Section 11.08                          No
Personal Liability of Directors, Officers, Employees and Stockholders.

 

No
limited partner of the Partnership or director, officer, employee, incorporator
or stockholder of the General Partner, Finance Corp., as such, will have any
liability for any obligations of the Issuers under the Notes or this Indenture
or any claim based on, in respect of, or by reason of, such obligations.  Each Holder of Notes by accepting a Note
waives and releases all such liability. 
The waiver and release are part of the consideration for issuance of the
Notes.  The waiver may not be effective
to waive liabilities under the federal securities laws and it is the view of
the SEC that such waiver is against public policy.

 

Section 11.09                          Governing
Law.

 

THE
INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS
INDENTURE AND THE NOTES  WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

Section 11.10                          Successors.

 

All
agreements of the Issuers in this Indenture and the Notes will bind their
successors.  All agreements of the
Trustee in this Indenture will bind its successors.

 

83

 

Section 11.11                          Severability.

 

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

 

Section 11.12                          Counterpart
Originals.

 

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

 

Section 11.13                          Table
of Contents, Headings, etc.

 

The
Table of Contents, Cross-Reference Table and Headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and will in no way
modify or restrict any of the terms or provisions hereof.

 

Section 11.14                          Force
Majeure.

 

In
no event shall the Trustee be responsible or liable for any failure or delay in
the performance of its obligations hereunder arising out of or caused by,
directly or indirectly, forces beyond its control, including, without
limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil
or military disturbances, nuclear or natural catastrophes or acts of God, and
interruptions, loss or malfunctions of utilities, communications or computer
(software and hardware) services; it being understood that the Trustee shall
use reasonable efforts which are consistent with accepted practices in the
banking industry to resume performance as soon as practicable under the
circumstances.

 

Section 11.15                          U.S.A.
Patriot Act

 

The
parties hereto acknowledge that in accordance with Section 326 of the
U.S.A. Patriot Act, the Trustee, like all financial institutions and in order
to help fight the funding of terrorism and money laundering, is required to
obtain, verify, and record information that identifies each person or legal
entity that establishes a relationship or opens an account with the
Trustee.  The parties to this Indenture
agree that they will provide the Trustee with such information as it may
request in order for the Trustee to satisfy the requirements of the U.S.A.
Patriot Act.

 

[Signatures on following page]

 

84

 

SIGNATURES

 

	
  Dated
  as of November 24, 2010

  	
   

  
	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  FERRELLGAS,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. RYAN VANWINKLE

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FERRELLGAS
  FINANCE CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. RYAN VANWINKLE

  
	
   

  	
  Name:
  J. Ryan VanWinkle

  
	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  U.S.
  BANK NATIONAL ASSOCIATION,

  	
   

  
	
  as
  Trustee

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ THOMAS E. TABOR

  	
   

  
	
   

  	
  Name:
  Thomas E. Tabor

  	
   

  
	
   

  	
  Title:
  Vice President

  	
   

  

 

85

 

EXHIBIT A1

 

[Face of Note]

CUSIP                                            

 

6.50% Senior Notes due 2021

 

	
  No.

  	
  $                            

  

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

promises to pay to CEDE & CO. or registered assigns,

 

the principal sum of
                                                                                                                                             Dollars
on May 1, 2021.

 

Interest Payment Dates:  May 1
and November 1

 

Record Dates:  April 15 and October 15

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FERRELLGAS,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  J.
  Ryan VanWinkle

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  FERRELLGAS
  FINANCE CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  J.
  Ryan VanWinkle

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
						

 

	
  This
  is one of the Notes referred to

  	
   

  
	
  in
  the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  U.S.
  BANK NATIONAL ASSOCIATION,

  	
   

  
	
  as
  Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  

 

A1-1

 

[Back of Note]

 

6.50% Senior Notes due 2021

 

[Insert
the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]

 

[Insert
Private Placement Legend, if applicable pursuant to the provisions of the
Indenture]

 

Capitalized
terms used herein have the meanings assigned to them in the Indenture referred
to below unless otherwise indicated.

 

(1)           INTEREST.  Ferrellgas, L.P., a Delaware limited
partnership, and Ferrellgas Finance Corp., a Delaware corporation (together,
the “Issuers”), promise to pay interest on the principal amount of this Note at
6.50% per annum from November 24, 2010 until maturity.  The Issuers will pay interest semi-annually
in arrears on May 1 and November 1 of each year, or if any such day
is not a Business Day, on the next succeeding Business Day (each, an “Interest
Payment Date”).  Interest on the Notes
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred
to on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be May 1, 2011. 
The Issuers will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; they will pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on demand at
the same rate to the extent lawful. 
Interest will be computed on the basis of a 360-day year of twelve
30-day months.

 

(2)           METHOD OF PAYMENT.  The Issuers will pay interest on the Notes to
the Persons who are registered Holders of Notes at the close of business on the
April 15 or October 15 next preceding the Interest Payment Date, even
if such Notes are canceled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.12 of the Indenture
with respect to defaulted interest.  The
Notes will be payable as to principal, premium, if any, and interest at the
office or agency of the Issuers maintained for such purpose within the City and
State of New York, or, at the option of the Issuers, payment of interest may be
made by check mailed to the Holders at their addresses set forth in the
register of Holders; provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest, premium on, all Global Notes the
Holders of which will have provided wire transfer instructions to the Issuers
or the Paying Agent.  Such payment will
be in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.

 

(3)           PAYING AGENT AND
REGISTRAR.  Initially, U.S.
Bank National Association, the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Issuers may 

 

A1-2

 

change any Paying Agent or
Registrar without notice to any Holder. 
The Issuers or any of their Subsidiaries may act in any such capacity.

 

(4)           INDENTURE.  The Issuers issued the Notes under an
Indenture dated as of November 24, 2010 (the “Indenture”) among the
Issuers 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, as amended (15 U.S.
Code §§ 77aaa-77bbbb).  The Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms.  To
the extent any provision of this Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be controlling.  The Notes are unsecured obligations of the
Issuers.

 

(5)           Optional Redemption.

 

The Issuers will not have the option to redeem the
Notes prior to May 1, 2016. 
Thereafter, the Issuers will have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days’ notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest thereon to the applicable redemption
date, if redeemed during the twelve months beginning on May 1 of the years
indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2016

  	
   

  	
  103.250

  	
  %

  
	
  2017

  	
   

  	
  102.167

  	
  %

  
	
  2018

  	
   

  	
  101.083

  	
  %

  
	
  2019 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(6)           Mandatory Redemption.

 

The
Issuers will not be required to make mandatory redemption payments with respect
to the Notes.

 

(7)           Repurchase at Option of
Holder.

 

(a)  If there is a
Change of Control, the Issuers will be required to make an offer (a “Change of
Control Offer”) to repurchase, in cash, all or any part (equal to $2,000 or an
integral multiple of $1,000 in excess thereof) of each Holder’s Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest thereon, if any, to the date of purchase (the “Change
of Control Payment”).  Within 30 days
following any Change of Control, the Issuers will mail a notice to each Holder
setting forth the procedures governing the Change of Control Offer as required
by the Indenture.

 

(b)  If the Partnership
or any of its Restricted Subsidiary consummates any Asset Sales, within 15 days
of each date on which the aggregate amount of Excess Proceeds exceeds $20
million, the Issuers will commence an offer to all Holders of Notes and all
holders of other Indebtedness that are pari
passu with the Notes containing provisions similar to those set
forth in this Indenture with respect to offers to purchase or redeem with the
proceeds of sales of assets (an “Asset Sale Offer”) pursuant to Section 

 

A1-3

 

3.09 of the Indenture to purchase the maximum
principal amount of Notes and other pari
passu Indebtedness 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
thereof plus accrued and unpaid interest thereon, if any, to the date fixed for
the closing of such offer, in accordance with the procedures set forth in the
Indenture.  To the extent that the
aggregate amount of Notes and other pari
passu Indebtedness tendered pursuant to an Asset Sale Offer is less
than the Excess Proceeds, the Partnership or any Restricted Subsidiary may use
such deficiency for general business purposes. 
If the aggregate principal amount of Notes and other pari passu Indebtedness surrendered by
holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select
the Notes and other pari passu
Indebtedness to be purchased on a pro rata
basis.  Holders of Notes that are the
subject of an offer to purchase will receive an Asset Sale Offer from the
Issuers prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled “Option of Holder to Elect Purchase”
on the reverse of the Notes.

 

(8)           NOTICE OF REDEMPTION.  Notice of redemption will be mailed at least
10 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $2,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

(9)           DENOMINATIONS,
TRANSFER, EXCHANGE.  The Notes
are in registered form without coupons in denominations of $2,000 and integral
multiples of $1,000 in excess thereof. 
The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture.  The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Issuers may require a
Holder to pay any taxes and fees required by law or permitted by the
Indenture.  The Issuers need not exchange
or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part.  Also, the Issuers need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date
and the corresponding Interest Payment Date.

 

(10)         PERSONS DEEMED OWNERS.  The registered Holder of a Note may be
treated as its owner for all purposes.

 

(11)         AMENDMENT, SUPPLEMENT AND
WAIVER.  Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes (including, consents obtained in connection with a tender
offer or exchange offer for Notes), and any existing default or compliance with
any provision of the Indenture or the Notes may be waived with the consent of
the Holders of a majority in aggregate principal amount of the then outstanding
Notes (including, consents obtained in connection with a tender offer or
exchange offer for Notes).  Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Issuers’ obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that could provide any
additional 

 

A1-4

 

rights or benefits to the
Holders of the Notes that does not adversely affect the legal rights under the
Indenture of any such Holder, to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the Trust
Indenture Act, or to provide for security for or add guarantees with respect to
the Notes.

 

(12)         DEFAULTS AND REMEDIES.  Events of Default include:  Each of the following is an “Event of Default”:
(i) default in the payment of the principal of or premium, if any, on any
Note when the same becomes due and payable, upon stated maturity, acceleration,
optional redemption, required purchase, scheduled principal payment or
otherwise; (ii) default in the payment of an installment of interest on
any of the Notes, when the same becomes due and payable, which default
continues for a period of 30 days; (iii) failure of the Issuers to perform
or observe any other term, covenant or agreement contained in the Notes or the
Indenture, other than a default specified in either (i) or (ii) above,
and the default continues for a period of 45 days after written notice of the
default requiring the Issuers to remedy the same has been given to the
Partnership by the Trustee or to the Issuers and the Trustee by Holders of at
least 25% in aggregate principal amount of the Notes then outstanding; (iv) default
or defaults under certain other agreements, instruments, mortgages, bonds,
debentures or other evidences of Indebtedness under which the Partnership or
any Restricted Subsidiary of the Partnership has outstanding Indebtedness in
excess of $25 million if the default (x) is caused by a failure to pay
principal of or premium, if any, or interest on to such Indebtedness within the
applicable grace period, if any, provided with respect to such Indebtedness or (y) results
in the acceleration of such Indebtedness prior to its stated maturity; (v) certain
final judgment or judgments, which is or are non-appealable and non-reviewable
or which has or have not been stayed pending appeal or review or as to which
all rights to appeal or review have expired or been exhausted, shall have been rendered
against the Partnership, any Restricted Subsidiary or the General Partner
provided such judgment or judgments requires or require the payment of money in
excess of $25 million in the aggregate and is not covered by insurance or
discharged or stayed pending appeal or review within 60 days after entry of
such judgment or in the event of a stay, within 30 days after the stay expires;
or (vi) specified events of bankruptcy, insolvency, or reorganization with
respect to the Issuers or any of their Significant Subsidiaries as more fully
set forth in the Indenture.  If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the applicable series of Notes then outstanding Notes
may declare all the Notes of that series to be due and payable.  Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency,
with respect to the Partnership, Finance Corp. or any Significant Subsidiary,
all outstanding Notes will become due and payable without further action or
notice.  Holders may not enforce the
Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of a series of then outstanding Notes may direct
the Trustee of that series of Notes in its exercise of any trust or power. The
Trustee may withhold from Holders of the Notes notice of any continuing Default
or Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines in good faith that
withholding notice is in their interest. 
The Holders of a majority in aggregate principal amount of a series of
Notes then outstanding by notice to the Trustee for those Notes may on behalf
of all Holders of Notes of that series waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of interest on, or the principal of, 

 

A1-5

 

the Notes.  The Issuers are required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Issuers are required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.

 

(13)         TRUSTEE DEALINGS WITH
ISSUERS.  The Trustee, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the Issuers or their Affiliates, and may otherwise deal
with the Issuers or their Affiliates, as if it were not the Trustee.

 

(14)         NO RECOURSE AGAINST
OTHERS.  A limited partner of
the Partnership or director, officer, employee, incorporator or stockholder of
the General Partner or Finance Corp., as such, will not have any liability for
any obligations of the Issuers under the Notes or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations.  Each Holder by accepting a Note waives and
releases all such liability.  The waiver
and release are part of the consideration for the issuance of the Notes.

 

(15)         AUTHENTICATION.  This Note will not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

(16)         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 entireties), JT
TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

(17)         ADDITIONAL RIGHTS OF
HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In addition to the rights provided to Holders
of Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes will have all the rights set forth in the Registration Rights
Agreement dated as of November 24, 2010, among the Issuers and the other
parties named on the signature pages thereof or, in the case of Additional
Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights agreements, if
any, among the Issuers and the other parties thereto, relating to rights given
by the Issuers to the purchasers of any Additional Notes (collectively, the “Registration
Rights Agreement”).

 

(18)         CUSIP NUMBERS.  Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Issuers have
caused CUSIP numbers to be printed on the Notes and the Trustee may 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.

 

(19)         GOVERNING LAW.  THE INTERNAL LAW OF THE STATE OF NEW YORK
WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THIS NOTE WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

A1-6

 

The
Issuers will furnish to any Holder upon written request and without charge a
copy of the Indenture.  Requests may be
made to:

 

	
   

  	
  Ferrellgas,
  L.P.

  
	
   

  	
  7500
  College Boulevard

  
	
   

  	
  Suite 1000

  
	
   

  	
  Overland
  Park, Kansas 66210

  
	
   

  	
  Attention:
  Investor Relations

  
	
   

  	
  (913)
  661-1537

  

 

A1-7

 

ASSIGNMENT FORM

 

To
assign this Note, fill in the form below:

 

	
  (I) or (we) assign and transfer this Note to:

  	
   

  

(Insert assignee’s legal
name)

 

	
   

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

  

 

	
   

  
	
   

  
	
   

  
	
   

  

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

 

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

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  	
   

  
						

 

*              Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A1-8

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If
you want to elect to have this Note purchased by the Issuers pursuant to Section 4.10
or 4.14 of the Indenture, check the appropriate box below:

 

o Section 4.10                              o Section 4.14

 

If
you want to elect to have only part of the Note purchased by the Issuers
pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased:

 

$                       

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tax
  Identification No.:

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  	
   

  
							

 

*              Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A1-9

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*

 

The
following exchanges of a part of this Global Note for an interest in another
Global Note or for a Definitive Note, or exchanges of a part of another Global
Note or Definitive Note for an interest in this Global Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of decrease in

  Principal Amount of 

  this Global Note

  	
   

  	
  Amount of increase in

  Principal Amount of 

  this Global Note

  	
   

  	
  Principal Amount 

  of this Global Note

  following such decrease

  (or increase)

  	
   

  	
  Signature of authorized

  signatory of Trustee or

  Custodian

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

* This schedule should be included only if the Note is
issued in global form.

 

A1-10

 

EXHIBIT A2

 

[Face of Regulation S Temporary Global Note]

CUSIP                                              

 

6.50% Senior Notes due 2021

 

	
  No.

  	
  $                         

  

 

FERRELLGAS, L.P.

FERRELLGAS FINANCE CORP.

 

promises to pay to CEDE & CO. or registered assigns,

 

the principal sum of
                                                                                                                                  
Dollars on May 1, 2021.

 

Interest Payment Dates:  May 1
and November 1

 

Record Dates:  April 15 and October 15

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FERRELLGAS,
  L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  Ferrellgas, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  J.
  Ryan VanWinkle

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  FERRELLGAS
  FINANCE CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
  J.
  Ryan VanWinkle

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
						

 

	
  This
  is one of the Notes referred to

  	
   

  
	
  in
  the within-mentioned Indenture:

  	
   

  
	
   

  	
   

  
	
  U.S.
  BANK NATIONAL ASSOCIATION,

  	
   

  
	
  as
  Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  

 

A2-1

 

[Back of Regulation S Temporary Global Note]

6.50% Senior Notes due 2021

 

THE
RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS
AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED
IN THE INDENTURE (AS DEFINED HEREIN). 
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S
TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.

 

THIS
GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING
THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS
HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT
THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR
WRITTEN CONSENT OF THE ISSUERS.

 

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.  UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55
WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE ISSUERS OR THEIR AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE, BY ITS 

 

A2-2

 

ACCEPTANCE
HEREOF, AGREES NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
THE DATE WHICH IS ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) (THE “RESALE RESTRICTION
TERMINATION DATE”), EXCEPT THAT THE NOTES MAY BE TRANSFERRED (A) TO
THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
NOTES ENDORSED THEREON ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED
INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES
ACT, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT)
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THE NOTES
AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUERS THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER (1) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE
40-DAY DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT OR PURSUANT TO CLAUSE (F) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (2) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.

 

Capitalized
terms used herein have the meanings assigned to them in the Indenture referred
to below unless otherwise indicated.

 

(1)           INTEREST.  Ferrellgas, L.P., a Delaware limited
partnership, and Ferrellgas Finance Corp., a Delaware corporation (together,
the “Issuers”), promise to pay interest on the principal amount of this Note at
6.50% per annum from November 24, 2010 until maturity.  The Issuers will pay interest semi-annually
in arrears on May 1 and November 1 of each year, or if any such day
is not a Business Day, on the next succeeding Business Day (each, an “Interest
Payment Date”).  Interest on the Notes
will accrue from the most 

 

A2-3

 

recent date to which
interest has been paid or, if no interest has been paid, from the date of issuance;
provided that if there is no
existing Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further,
that the first Interest Payment Date shall be May 1, 2011.  The Issuers will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is 1%
per annum in excess of the rate then in effect; they will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue installments of interest (without regard to any applicable grace
periods) from time to time on demand at the same rate to the extent
lawful.  Interest will be computed on the
basis of a 360-day year of twelve 30-day months.

 

Until
this Regulation S Temporary Global Note is exchanged for one or more Regulation
S Permanent Global Notes, the Holder hereof shall not be entitled to receive
payments of interest hereon; until so exchanged in full, this Regulation S
Temporary Global Note shall in all other respects be entitled to the same
benefits as other Notes under the Indenture.

 

(2)           METHOD OF PAYMENT.  The Issuers will pay interest on the Notes to
the Persons who are registered Holders of Notes at the close of business on the
April 15 or October 15 next preceding the Interest Payment Date, even
if such Notes are canceled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.12 of the Indenture
with respect to defaulted interest.  The
Notes will be payable as to principal, premium, if any, and interest at the office
or agency of the Issuers maintained for such purpose within the City and State
of New York, or, at the option of the Issuers, payment of interest may be made
by check mailed to the Holders at their addresses set forth in the register of
Holders; provided that payment by
wire transfer of immediately available funds will be required with respect to
principal of and interest, premium on, all Global Notes the Holders of which
will have provided wire transfer instructions to the Issuers or the Paying
Agent.  Such payment will be in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.

 

(3)           PAYING AGENT AND
REGISTRAR.  Initially, U.S.
Bank National Association, the Trustee under the Indenture, will act as Paying
Agent and Registrar.  The Issuers may
change any Paying Agent or Registrar without notice to any Holder.  The Issuers or any of their Subsidiaries may
act in any such capacity.

 

(4)           INDENTURE.  The Issuers issued the Notes under an
Indenture dated as of November 24, 2010 (the “Indenture”) among the
Issuers 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, as amended (15 U.S.
Code §§ 77aaa-77bbbb).  The Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms.  To
the extent any provision of this Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be
controlling.  The Notes are unsecured
obligations of the Issuers.

 

A2-4

 

(5)           Optional Redemption.

 

The Issuers will not have the option to redeem the
Notes prior to May 1, 2016. 
Thereafter, the Issuers will have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days’ notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest thereon to the applicable redemption date, if
redeemed during the twelve months beginning on May 1 of the years
indicated below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2016

  	
   

  	
  103.250

  	
  %

  
	
  2017

  	
   

  	
  102.167

  	
  %

  
	
  2018

  	
   

  	
  101.083

  	
  %

  
	
  2019 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

(6)           Mandatory Redemption.

 

The
Issuers will not be required to make mandatory redemption payments with respect
to the Notes.

 

(7)           Repurchase at Option of
Holder.

 

(a)  If there is a
Change of Control, the Issuers will be required to make an offer (a “Change of
Control Offer”) to repurchase, in cash, all or any part (equal to $2,000 or an
integral multiple of $1,000 in excess thereof) of each Holder’s Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest thereon, if any, to the date of purchase ( the “Change
of Control Payment”).  Within 30 days
following any Change of Control, the Issuers will mail a notice to each Holder
setting forth the procedures governing the Change of Control Offer as required
by the Indenture.

 

(b)  If the Partnership
or any of its Restricted Subsidiary consummates any Asset Sales, within 15 days
of each date on which the aggregate amount of Excess Proceeds exceeds $20
million, the Issuers will commence an offer to all Holders of Notes and all
holders of other Indebtedness that are pari
passu with the Notes containing provisions similar to those set
forth in this Indenture with respect to offers to purchase or redeem with the
proceeds of sales of assets (an “Asset Sale Offer”) pursuant to Section 3.09
of the Indenture to purchase the maximum principal amount of Notes and other pari passu Indebtedness 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 thereof plus accrued and unpaid interest
thereon, if any, to the date fixed for the closing of such offer, in accordance
with the procedures set forth in the Indenture. 
To the extent that the aggregate amount of Notes and other pari passu Indebtedness tendered pursuant
to an Asset Sale Offer is less than the Excess Proceeds, the Partnership or any
Restricted Subsidiary may use such deficiency for general business
purposes.  If the aggregate principal amount
of Notes and other pari passu
Indebtedness surrendered by holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and other pari passu Indebtedness to be purchased on
a pro rata basis.  Holders of Notes that are the subject of an
offer to 

 

A2-5

 

purchase will receive an Asset Sale Offer from the
Issuers prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled “Option of Holder to Elect Purchase”
on the reverse of the Notes.

 

(8)           NOTICE OF REDEMPTION.  Notice of redemption will be mailed at least
10 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address.  Notes in denominations larger than $2,000 may
be redeemed in part but only in whole multiples of $1,000, unless all of the
Notes held by a Holder are to be redeemed. 
On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.

 

(9)           DENOMINATIONS,
TRANSFER, EXCHANGE.  The Notes
are in registered form without coupons in denominations of $2,000 and integral
multiples of $1,000 in excess thereof. 
The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture.  The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Issuers may require a
Holder to pay any taxes and fees required by law or permitted by the
Indenture.  The Issuers need not exchange
or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part.  Also, the Issuers need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date
and the corresponding Interest Payment Date.

 

(10)         PERSONS DEEMED OWNERS.  The registered Holder of a Note may be
treated as its owner for all purposes.

 

(11)         AMENDMENT, SUPPLEMENT AND
WAIVER.  Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the then
outstanding Notes (including, consents obtained in connection with a tender
offer or exchange offer for Notes), and any existing default or compliance with
any provision of the Indenture or the Notes may be waived with the consent of
the Holders of a majority in aggregate principal amount of the then outstanding
Notes (including, consents obtained in connection with a tender offer or
exchange offer for Notes).  Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Issuers’ obligations to Holders of the Notes
in case of a merger or consolidation, to make any change that could provide any
additional rights or benefits to the Holders of the Notes that does not
adversely affect the legal rights under the Indenture of any such Holder, to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act, or to provide for
security for or add guarantees with respect to the Notes.

 

(12)         DEFAULTS AND REMEDIES.  Events of Default include:  Each of the following is an “Event of Default”:
(i) default in the payment of the principal of or premium, if any, on any
Note when the same becomes due and payable, upon stated maturity, acceleration,
optional redemption, required purchase, scheduled principal 

 

A2-6

 

payment or otherwise; (ii) default
in the payment of an installment of interest on any of the Notes, when the same
becomes due and payable, which default continues for a period of 30 days; (iii) failure
of the Issuers to perform or observe any other term, covenant or agreement contained
in the Notes or the Indenture, other than a default specified in either (i) or
(ii) above, and the default continues for a period of 45 days after
written notice of the default requiring the Issuers to remedy the same has been
given to the Partnership by the Trustee or to the Issuers and the Trustee by
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding; (iv) default or defaults under certain other agreements,
instruments, mortgages, bonds, debentures or other evidences of Indebtedness
under which the Partnership or any Restricted Subsidiary of the Partnership has
outstanding Indebtedness in excess of $25 million if the default (x) is
caused by a failure to pay principal of or premium, if any, or interest on to
such Indebtedness within the applicable grace period, if any, provided with
respect to such Indebtedness or (y) results in the acceleration of such
Indebtedness prior to its stated maturity; (v) certain final judgment or
judgments, which is or are non-appealable and non-reviewable or which has or
have not been stayed pending appeal or review or as to which all rights to
appeal or review have expired or been exhausted, shall have been rendered
against the Partnership, any Restricted Subsidiary or the General Partner provided
such judgment or judgments requires or require the payment of money in excess
of $25 million in the aggregate and is not covered by insurance or discharged
or stayed pending appeal or review within 60 days after entry of such judgment
or in the event of a stay, within 30 days after the stay expires; or (vi) specified
events of bankruptcy, insolvency, or reorganization with respect to the Issuers
or any of their Significant Subsidiaries as more fully set forth in the
Indenture.  If any Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the applicable series of Notes then outstanding Notes may
declare all the Notes of that series to be due and payable.  Notwithstanding the foregoing, in the case of
an Event of Default arising from certain events of bankruptcy or insolvency,
with respect to the Partnership, Finance Corp. or any Significant Subsidiary,
all outstanding Notes will become due and payable without further action or
notice.  Holders may not enforce the
Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a
majority in principal amount of a series of then outstanding Notes may direct
the Trustee of that series of Notes in its exercise of any trust or power. The
Trustee may withhold from Holders of the Notes notice of any continuing Default
or Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines in good faith that withholding
notice is in their interest.  The Holders
of a majority in aggregate principal amount of a series of Notes then
outstanding by notice to the Trustee for those Notes may on behalf of all
Holders of Notes of that series waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event
of Default in the payment of interest on, or the principal of, the Notes.  The Issuers are required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Issuers are required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.

 

(13)         TRUSTEE DEALINGS WITH
ISSUERS.  The Trustee, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the 

 

A2-7

 

Issuers or their Affiliates,
and may otherwise deal with the Issuers or their Affiliates, as if it were not
the Trustee.

 

(14)         NO RECOURSE AGAINST
OTHERS.  A limited partner of
the Partnership or director, officer, employee, incorporator or stockholder of
the General Partner or Finance Corp., as such, will not have any liability for
any obligations of the Issuers under the Notes or the Indenture or for any
claim based on, in respect of, or by reason of, such obligations.  Each Holder by accepting a Note waives and
releases all such liability.  The waiver
and release are part of the consideration for the issuance of the Notes.

 

(15)         AUTHENTICATION.  This Note will not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

(16)         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 entireties), JT
TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

(17)         ADDITIONAL RIGHTS OF HOLDERS
OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In addition to the rights provided to Holders
of Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes will have all the rights set forth in the Registration Rights
Agreement dated as of November 24, 2010, among the Issuers and the other
parties named on the signature pages thereof or, in the case of Additional
Notes, Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights agreements, if
any, among the Issuers and the other parties thereto, relating to rights given
by the Issuers to the purchasers of any Additional Notes (collectively, the “Registration
Rights Agreement”).

 

(18)         CUSIP NUMBERS.  Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Issuers have
caused CUSIP numbers to be printed on the Notes and the Trustee may 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.

 

(19)         GOVERNING LAW.  THE INTERNAL LAW OF THE STATE OF NEW YORK
WILL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THIS NOTE  WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

 

A2-8

 

The
Issuers will furnish to any Holder upon written request and without charge a
copy of the Indenture.  Requests may be
made to:

 

	
   

  	
  Ferrellgas,
  L.P.

  
	
   

  	
  7500
  College Boulevard

  
	
   

  	
  Suite 1000

  
	
   

  	
  Overland
  Park, Kansas 66210

  
	
   

  	
  Attention:
  Investor Relations

  
	
   

  	
  (913)
  661-1537

  

 

A2-9

 

ASSIGNMENT FORM

 

To
assign this Note, fill in the form below:

 

	
  (I) or (we) assign and transfer this Note to:

  	
   

  

(Insert assignee’s legal
name)

 

	
   

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

  

 

	
   

  
	
   

  
	
   

  
	
   

  

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

 

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

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  	
   

  
						

 

*              Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A2-10

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If
you want to elect to have this Note purchased by the Issuers pursuant to Section 4.10
or 4.14 of the Indenture, check the appropriate box below:

 

o Section 4.10                   o Section 4.14

 

If
you want to elect to have only part of the Note purchased by the Issuers
pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased:

 

$                       

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature:

  	
   

  
	
   

  	
   

  	
  (Sign exactly as your name appears on the face of this Note)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tax
  Identification No.:

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  	
   

  
							

 

*              Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A2-11

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S TEMPORARY GLOBAL
NOTE

 

The
following exchanges of a part of this Regulation S Temporary Global Note for an
interest in another Global Note, or exchanges of a part of another other
Restricted Global Note for an interest in this Regulation S Temporary Global
Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of decrease in

  Principal Amount 

  of 

  this Global Note

  	
   

  	
  Amount of increase in

  Principal Amount 

  of 

  this Global Note

  	
   

  	
  Principal Amount 

  of this Global Note

  following such decrease

  (or increase)

  	
   

  	
  Signature of authorized

  signatory of Trustee or

  Custodian

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A2-12Exhibit 4.2

 

EXECUTION VERSION

 

REGISTRATION RIGHTS AGREEMENT

 

 

by
and among

 

 

Ferrellgas, L.P.

Ferrellgas Finance Corp.

 

and

 

 

J.P.
Morgan Securities LLC

Merrill
Lynch, Pierce, Fenner & Smith Incorporated

Wells
Fargo Securities, LLC

Barclays Capital Inc.

BNP
Paribas Securities Corp.

Capital One Southcoast, Inc.

Fifth Third Securities, Inc.

PNC Capital Markets LLC

SG Americas Securities, LLC

UBS Securities LLC

U.S. Bancorp Investments, Inc.

 

 

Dated
as of November 24, 2010

 

 

REGISTRATION
RIGHTS AGREEMENT

 

This Registration Rights
Agreement (this “Agreement”) is made and entered into as of November 24,
2010, by and among Ferrellgas, L.P., a Delaware limited partnership (the “Company”),
Ferrellgas Finance Corp., a Delaware corporation (“Finance Corp.” and, together
with the Company, the “Issuers”), and J.P. Morgan Securities LLC, Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities,
LLC, Barclays Capital Inc., BNP Paribas
Securities Corp., Capital One Southcoast, Inc., Fifth Third Securities, Inc., PNC Capital Markets
LLC, SG Americas Securities, LLC, UBS Securities LLC and U.S. Bancorp Investments, Inc.  (collectively, the “Initial Purchasers”),
each of whom has agreed to purchase the Issuers’ 6.50% Senior Notes due 2021
(the “Securities”) pursuant to the Purchase Agreement (as defined below).

 

This Agreement is made
pursuant to the Purchase Agreement, dated November 9, 2010 (the “Purchase
Agreement”), among the Issuers and the Initial Purchasers (i) for the
benefit of the Initial Purchasers and (ii) for the benefit of the holders
from time to time of Transfer Restricted Securities (as defined below), including the Initial Purchasers.  In order to induce the Initial Purchasers to
purchase the Securities, the Issuers have agreed to provide the registration
rights set forth in this Agreement.  The
execution and delivery of this Agreement is a condition to the obligations of
the Initial Purchasers set forth in Section 4(h) of the Purchase
Agreement.

 

The parties hereby agree as
follows:

 

SECTION 1.     Definitions.

 

As
used in this Agreement, the following capitalized terms shall have the
following meanings:

 

Additional
Interest Payment Date:  With respect to
the Transfer Restricted Securities, each Interest Payment Date.

 

Advice:  As defined in the last paragraph of Section 6(c) hereof.

 

Agreement:  As defined in the preamble hereto.

 

Broker-Dealer:  Any broker or dealer
registered under the Exchange Act.

 

Business
Day:  Any day other than a Saturday,
Sunday or U.S. federal holiday or a day on which banking institutions or trust
companies located in New York, New York are authorized or obligated to be
closed.

 

Closing
Date:  The date of this Agreement.

 

Commission:  The Securities and Exchange
Commission.

 

Company:  As defined in the preamble hereto.

 

1

 

Consummate:  A registered Exchange Offer
shall be deemed “Consummated” for purposes of this Agreement upon the
occurrence of (i) the filing and effectiveness under the Securities Act of
the Exchange Offer Registration Statement relating to the Exchange Securities
to be issued in the Exchange Offer, (ii) the maintenance of such
Registration Statement continuously effective and the keeping of the Exchange
Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof,
and (iii) the delivery by the Issuers to the Registrar under the Indenture
of Exchange Securities in the same aggregate principal amount as the aggregate
principal amount of Transfer Restricted Securities that were tendered by
Holders thereof pursuant to the Exchange Offer.

 

Exchange
Act:  The Securities Exchange Act
of 1934, as amended.

 

Exchange
Date:  As defined in Section 3(b) hereto.

 

Exchange
Offer:  The registration by the
Issuers under the Securities Act of the Exchange Securities pursuant to a
Registration Statement pursuant to which the Issuers offer the Holders of all
outstanding Transfer Restricted Securities the opportunity to exchange all such
outstanding Transfer Restricted Securities held by such Holders for Exchange
Securities in an aggregate principal amount equal to the aggregate principal
amount of the Transfer Restricted Securities tendered in such exchange offer by
such Holders.

 

Exchange
Offer Registration Statement:  The
Registration Statement relating to the Exchange Offer, including the related
Prospectus.

 

Exempt
Resales:  The transactions in which
the Initial Purchasers propose to sell the Transfer Restricted Securities to
certain “qualified institutional buyers,” as such term is defined in Rule 144A
under the Securities Act and to certain non-U.S. persons pursuant to Regulation
S under the Securities Act.

 

Exchange
Securities:  The 6.50%
Senior Notes due 2021, of the same series under the Indenture as the Transfer
Restricted Securities, to be issued to Holders in exchange for Transfer
Restricted Securities pursuant to this Agreement.

 

Finance Corp.:  As defined in the preamble hereto.

 

FINRA:  Financial Industry Regulatory Authority, Inc.

 

Holders:  As defined in Section 2(b) hereof.

 

Indemnified
Holder:  As defined in Section 8(a) hereof.

 

Indenture:  The Indenture, dated as of November 24,
2010, by and among the Issuers and U.S. Bank National Association, as trustee
(the “Trustee”), pursuant to which the Securities are to be issued, as such
Indenture is amended or supplemented from time to time in accordance with the
terms thereof.

 

Initial
Purchasers:  As defined in
the preamble hereto.

 

2

 

Initial
Placement:  The issuance
and sale by the Issuers of the Securities to the Initial Purchasers pursuant to
the Purchase Agreement.

 

Interest
Payment Date:  As defined in
the Indenture and the Securities.

 

Person:  An individual, partnership,
corporation, trust or unincorporated organization, or a government or agency or
political subdivision thereof.

 

Prospectus:  The prospectus included in a
Registration Statement, as amended or supplemented by any prospectus supplement
and by all other amendments thereto, including post-effective amendments, and all
material incorporated by reference into such Prospectus.

 

Registration
Default:  As defined in Section 5
hereof.

 

Registration
Statement:  Any
registration statement of either of the Issuers relating to (a) an
offering of Exchange Securities pursuant to an Exchange Offer or (b) the
registration for resale of Transfer Restricted Securities pursuant to the Shelf
Registration Statement, which is filed pursuant to the provisions of this
Agreement, in each case, including the Prospectus included therein, all
amendments and supplements thereto (including post-effective amendments) and
all exhibits and material incorporated by reference therein.

 

Rule 144:  Rule 144 as promulgated under the Securities Act.

 

Securities:  As defined in the preamble
hereto.

 

Securities
Act:  The Securities Act of 1933,
as amended.

 

Shelf
Filing Deadline:  As defined in Section 4(a) hereof.

 

Shelf
Registration Statement:  As defined in Section 4(a) hereof.

 

Transfer
Restricted Securities:  The
Securities; provided that the Securities shall cease to be Transfer Restricted
Securities on the earliest to occur of (i) the date on which a
Registration Statement with respect to such Securities has become effective
under the Securities Act and such Securities have been exchanged or disposed of
pursuant to such Registration Statement and (ii) the date on which such
Securities cease to be outstanding.

 

Trust
Indenture Act:  The Trust
Indenture Act of 1939, as amended.

 

Underwritten
Registration or Underwritten Offering:  A registration
in which securities of the Issuers are sold to an underwriter for reoffering to
the public.

 

SECTION 2.     Securities
Subject to this Agreement.

 

(a)           Transfer
Restricted Securities.  The
securities entitled to the benefits of this Agreement are the Transfer
Restricted Securities.

 

3

 

(b)           Holders
of Transfer Restricted Securities.  A
Person is deemed to be a holder of Transfer Restricted Securities (each, a “Holder”)
whenever such Person owns Transfer Restricted Securities.

 

SECTION 3.     Registered
Exchange Offer.

 

(a)           Unless the Exchange Offer shall not
be permissible under applicable law or Commission policy (after the procedures
set forth in Section 6(a) hereof have been complied with), each of
the Issuers shall (i) cause to be filed with the Commission, a
Registration Statement under the Securities Act relating to the Exchange
Securities and the Exchange Offer, (ii) use its reasonable best efforts to
cause such Registration Statement to become effective, (iii) in connection
with the foregoing, file (A) all pre-effective amendments to such
Registration Statement as may be necessary in order to cause such Registration
Statement to become effective under the Securities Act, (B) if applicable,
a post-effective amendment to such Registration Statement pursuant to Rule 430A
under the Securities Act and (C) cause all necessary filings in connection
with the registration and qualification of the Exchange Securities to be made
under the state securities or blue sky laws of such jurisdictions as are
necessary to permit Consummation of the Exchange Offer, and (iv) upon the
effectiveness of such Registration Statement, promptly commence the Exchange
Offer.  The Exchange Offer shall be on
the appropriate form permitting registration of the Exchange Securities to be
offered in exchange for the Transfer Restricted Securities and to permit
resales of Transfer Restricted Securities held by Broker-Dealers as
contemplated by Section 3(c) hereof.

 

(b)           The Issuers shall cause the Exchange
Offer Registration Statement to be effective continuously and shall keep the
Exchange Offer open for a period of not less than the minimum period required
under applicable federal and state securities laws to Consummate the Exchange
Offer; provided, however, that in no event
shall such period be less than 30 days after the date notice of the Exchange
Offer is mailed to the Holders.  The
Issuers shall cause the Exchange Offer to comply with all applicable federal
and state securities laws.  No securities
other than the Exchange Securities shall be included in the Exchange Offer
Registration Statement.  The Issuers
shall use their reasonable best efforts to cause the Exchange Offer to be
Consummated no later than 300 days from the Closing Date (the “Exchange Date”).

 

(c)           The Issuers shall indicate in a “Plan
of Distribution” section contained in the Prospectus forming a part of the
Exchange Offer Registration Statement that any Broker-Dealer who holds Transfer
Restricted Securities that were acquired for its own account as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Issuers), may exchange such
Transfer Restricted Securities pursuant to the Exchange Offer; however, such
Broker-Dealer may be deemed to be an “underwriter” within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of the
Exchange Securities received by such Broker-Dealer in the Exchange Offer, which
prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement.  Such “Plan of Distribution”
section shall also contain all other information with respect to such resales
by Broker-Dealers that the Commission may require in order to permit such
resales pursuant thereto, but such “Plan of Distribution” shall not name any
such Broker-Dealer or disclose the amount of Transfer Restricted Securities
held by 

 

4

 

any such Broker-Dealer
except to the extent required by the Commission as a result of a change in
policy after the date of this Agreement.

 

Each of the Issuers shall
use its reasonable best efforts to keep the Exchange Offer Registration
Statement continuously effective, supplemented and amended as required by the
provisions of Section 6(c) hereof to the extent necessary to ensure
that it is available for resales of Transfer Restricted Securities acquired by
Broker-Dealers for their own accounts as a result of market-making activities
or other trading activities, and to ensure that it conforms with the
requirements of this Agreement, the Securities Act and the policies, rules and
regulations of the Commission as announced from time to time, for a period
ending on the earlier of (i) 180 days from the date on which the Exchange
Offer Registration Statement is declared effective and (ii) the date on
which a Broker-Dealer is no longer required to deliver a prospectus in
connection with market-making or other trading activities.

 

The Issuers shall provide
sufficient copies of the latest version of such Prospectus to Broker-Dealers
promptly upon request at any time during such 180-day (or shorter as provided
in the foregoing sentence) period in order to facilitate such resales.

 

SECTION 4.     Shelf
Registration.

 

(a)           Shelf
Registration.  If (i) the
Issuers are not required to file an Exchange Offer Registration Statement or to
consummate the Exchange Offer solely because the Exchange Offer is not
permitted by applicable law or Commission policy (after the procedures set
forth in Section 6(a) hereof have been complied with), (ii) for
any reason the Exchange Offer is required
by Section 3 hereof to be but is not Consummated by the Exchange Date, or (iii) prior to the Exchange Date:  (A) the Initial Purchasers request from
the Issuers with respect to Transfer Restricted Securities not eligible to be
exchanged for Exchange Securities in the Exchange Offer, (B) with respect
to any Holder of Transfer Restricted Securities such Holder notifies the
Issuers that (1) such Holder is prohibited by applicable law or Commission
policy from participating in the Exchange Offer, (2) such Holder may not
resell the Exchange Securities acquired by it in the Exchange Offer to the
public without delivering a prospectus and that the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder, or (3) such Holder is a Broker-Dealer and holds
Transfer Restricted Securities acquired directly from either of the Issuers or
one of their respective affiliates or (C) in the case of any Initial
Purchaser, such Initial Purchaser notifies the Issuers it will not receive
freely tradable Exchange Securities in exchange for Transfer Restricted
Securities constituting any portion of such Initial Purchaser’s unsold
allotment, then the Issuers shall

 

(x)            cause to be filed a shelf
registration statement pursuant to Rule 415 under the Securities Act,
which may be an amendment to the Exchange Offer Registration Statement (in
either event, the “Shelf Registration Statement”) on or prior to the 90th day
after the date such obligation arises (or if such 90th day is not a Business
Day, the next succeeding Business Day) (such date being the “Shelf Filing
Deadline”), which Shelf Registration Statement shall provide for resales of all
Transfer Restricted Securities the Holders of which shall have provided the
information required pursuant to Section 4(b) hereof; and

 

5

 

(y)           use their reasonable best efforts to
cause such Shelf Registration Statement to be declared effective by the
Commission on or before the 90th day after the Shelf Filing Deadline (or if
such 90th day is not a Business Day, the next succeeding Business Day).

 

Each of the Issuers shall
use its reasonable best efforts to keep such Shelf Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Sections 6(b) and (c) hereof to the extent necessary to ensure
that it is available for resales of Transfer Restricted Securities by the
Holders of such Securities entitled to the benefit of this Section 4(a),
and to ensure that it conforms with the requirements of this Agreement, the
Securities Act and the policies, rules and regulations of the Commission
as announced from time to time, for a period of two years following the
effective date of such Shelf Registration Statement (or shorter period that
will terminate when all the Transfer Restricted Securities covered by such
Shelf Registration Statement have been sold pursuant to such Shelf Registration
Statement).

 

(b)           Provision
by Holders of Certain Information in Connection with the Shelf Registration
Statement.  No Holder of
Transfer Restricted Securities may include any of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this Agreement
unless and until such Holder furnishes to the Issuers in writing, within 20
Business Days after receipt of a request therefor, such information as the
Issuers may reasonably request for use in connection with any Shelf
Registration Statement or Prospectus or preliminary Prospectus included
therein.  Each Holder as to which any
Shelf Registration Statement is being effected agrees to furnish promptly to
the Issuers all information required to be disclosed in order to make the
information previously furnished to the Issuers by such Holder not materially
misleading.

 

SECTION 5.     Additional
Interest.

 

If
(i) the Exchange Offer has not been Consummated on or prior to the
Exchange Date, (ii) any Shelf Registration Statement, if required hereby,
has not been filed or declared effective by the Commission (or otherwise automatically becomes
effective) when so required or (iii) any Registration Statement
required by this Agreement has been declared effective but ceases to be
effective at any time at which it is required to be effective under this
Agreement (each such event referred to in clauses (i) through (iii), a “Registration
Default”), each of the Issuers hereby agree that the interest rate borne by the
Transfer Restricted Securities shall be increased by 0.25% per annum during the
90-day period immediately following the occurrence of any Registration Default
and shall increase by 0.25% per annum at the end of each subsequent 90-day
period, but in no event shall such increase exceed 1.00% per annum.  Following the cure of all Registration Defaults
relating to the particular Transfer Restricted Securities, the interest rate
borne by the relevant Transfer Restricted Securities will be reduced to the
original interest rate borne by such Transfer Restricted Securities; provided, however, that, if after any such reduction in
interest rate, a different Registration Default occurs, the interest rate borne
by the relevant Transfer Restricted Securities shall again be increased
pursuant to the foregoing provisions.  The Issuers shall not be required to pay
additional interest pursuant to this Section 5 for more than one
Registration Default at any given time.

 

6

 

All obligations of the
Issuers set forth in the preceding paragraph that are outstanding with respect
to any Transfer Restricted Security at the time such security ceases to be a
Transfer Restricted Security shall survive until such time as all such
obligations with respect to such security shall have been satisfied in full.

 

SECTION 6.     Registration
Procedures.

 

(a)           Exchange
Offer Registration Statement.  In
connection with the Exchange Offer, the Issuers shall comply with all of the
provisions of Section 6(c) hereof, shall use their reasonable best
efforts to effect such exchange to permit the sale of Transfer Restricted
Securities being sold in accordance with the intended method or methods of
distribution thereof, and shall comply with all of the following provisions:

 

(i)      If in
the reasonable opinion of counsel to the Issuers there is a question as to
whether the Exchange Offer is permitted by applicable law, each of the Issuers
hereby agrees to seek a no-action letter or other favorable decision from the
Commission allowing the Issuers to Consummate an Exchange Offer for such
Transfer Restricted Securities.  Each of
the Issuers hereby agrees to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially
unreasonable action to effect a change of Commission policy.  Each of the Issuers hereby agrees, however,
to (A) participate in telephonic conferences with the Commission, (B) deliver
to the Commission staff an analysis prepared by counsel to the Issuers setting
forth the legal bases, if any, upon which such counsel has concluded that such
an Exchange Offer should be permitted and (C) diligently pursue a
favorable resolution by the Commission staff of such submission. 
Notwithstanding the above in this clause (i), after the Exchange Date,
the Issuers shall not be precluded from complying with the provision of Section 4
hereof and abandoning the requirement of this clause (i).

 

(ii)     As a
condition to its participation in the Exchange Offer pursuant to the terms of
this Agreement, each Holder of Transfer Restricted Securities shall furnish,
upon the request of the Issuers, prior to the Consummation thereof, a written
representation to the Issuers (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration Statement) to the
effect that (A) it is not an affiliate of either of the Issuers, (B) it
is not engaged in, and does not intend to engage in, and has no arrangement or
understanding with any Person to participate in, a distribution of the Exchange
Securities to be issued in the Exchange Offer and (C) it is acquiring the
Exchange Securities in its ordinary course of business.  In addition, all such Holders of Transfer
Restricted Securities shall otherwise cooperate in the Issuers’ preparations
for the Exchange Offer.  Each Holder
hereby acknowledges and agrees that any Broker-Dealer and any such Holder using
the Exchange Offer to participate in a distribution of the securities to be
acquired in the Exchange Offer (1) could not under Commission policy as in
effect on the date of this Agreement rely on the position of the Commission
enunciated in Morgan Stanley and Co., Inc. (available June 5,
1991) and Exxon Capital Holdings Corporation (available May 13,
1988), as interpreted in the Commission’s letter to Shearman &
Sterling dated July 2, 1993, and similar no-action letters (which may
include any no-action letter obtained pursuant to clause (i) above), and (2) must
comply with the registration and prospectus delivery requirements of the
Securities Act in

 

7

 

connection with a secondary resale transaction and that such a
secondary resale transaction should be covered by an effective registration
statement containing the selling security holder information required by Item
507 or 508, as applicable, of Regulation S-K if the resales are of Exchange
Securities obtained by such Holder in exchange for Transfer Restricted
Securities acquired by such Holder directly from the Issuers.

 

(b)           Shelf
Registration Statement.  If
required pursuant to Section 4, in connection with the Shelf Registration
Statement, each of the Issuers shall comply with all the provisions of Section 6(c) hereof
and shall use its reasonable best efforts to effect such registration to permit
the sale of the Transfer Restricted Securities being sold in accordance with
the intended method or methods of distribution thereof, and pursuant thereto
each of the Issuers will as expeditiously as possible prepare and file with the
Commission a Registration Statement relating to the registration on any appropriate
form under the Securities Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof.

 

(c)           General
Provisions.  In connection
with any Registration Statement and any Prospectus required by this Agreement
to permit the sale or resale of Transfer Restricted Securities (including,
without limitation, any Registration Statement and the related Prospectus
required to permit resales of Transfer Restricted Securities by
Broker-Dealers), each of the Issuers shall:

 

(i)      use
its reasonable best efforts to keep such Registration Statement continuously
effective and provide all requisite financial statements for the period
specified in Section 3 or 4 hereof, as applicable; upon the occurrence of
any event that would cause any such Registration Statement or the Prospectus
contained therein (A) to contain a material misstatement or omission or (B) not
to be effective and usable for resale of Transfer Restricted Securities during
the period required by this Agreement, the Issuers shall file promptly an
appropriate amendment to such Registration Statement, in the case of clause
(A), correcting any such misstatement or omission, and, in the case of either
clause (A) or (B), use its reasonable best efforts to cause such amendment
to be declared effective and such Registration Statement and the related
Prospectus to become usable for their intended purpose(s) as soon as
practicable thereafter;

 

(ii)     prepare
and file with the Commission such amendments and post-effective amendments to
the applicable Registration Statement as may be necessary to keep the
Registration Statement effective for the applicable period set forth in Section 3
or 4 hereof, as applicable, or such shorter period as will terminate when all
Transfer Restricted Securities covered by such Registration Statement have been
sold; cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 under
the Securities Act, and to comply fully with the applicable provisions of Rules 424
and 430A under the Securities Act in a timely manner; and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement during the applicable period
in accordance with the intended method or methods of distribution by the
sellers thereof set forth in such Registration Statement or supplement to the
Prospectus;

 

8

 

(iii)    advise
the underwriter(s), if any, and selling Holders promptly and, if requested by
such Persons, to confirm such advice in writing, (A) when the Prospectus
or any Prospectus supplement or post-effective amendment has been filed, and,
with respect to any Registration Statement or any post-effective amendment
thereto, when the same has become effective, (B) of any request by the
Commission for amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating thereto, (C) of
the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement under the Securities Act or of the suspension by
any state securities commission of the qualification of the Transfer Restricted
Securities for offering or sale in any jurisdiction, or the initiation of any
proceeding for any of the preceding purposes, (D) of the existence of any
fact or the happening of any event that makes any statement of a material fact
made in the Registration Statement, the Prospectus, any amendment or supplement
thereto, or any document incorporated by reference therein untrue, or that
requires the making of any additions to or changes in the Registration
Statement or the Prospectus in order to make the statements therein (with respect to the Prospectus, in light of
the circumstances under which they were made) not misleading.  If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration Statement, or any
state securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or blue sky laws, each of the Issuers
shall use its reasonable best efforts to obtain the withdrawal or lifting of
such order at the earliest possible time;

 

(iv)    furnish
without charge to each of the Initial Purchasers, each selling Holder named in
any Registration Statement, and each of the underwriter(s), if any, before
filing with the Commission, copies of any Registration Statement or any
Prospectus included therein or any amendments or supplements to any such
Registration Statement or Prospectus (including all documents incorporated by
reference after the initial filing of such Registration Statement), which
documents will be subject to the review and comment of such Holders and
underwriter(s) in connection with such sale, if any, for a period of at
least five Business Days, and neither of the Issuers will file any such
Registration Statement or Prospectus or any amendment or supplement to any such
Registration Statement or Prospectus (including all such documents incorporated
by reference) to which an Initial Purchaser of Transfer Restricted Securities
covered by such Registration Statement or the underwriter(s), if any, shall
reasonably object in writing within five Business Days after the receipt
thereof (such objection to be deemed timely made upon confirmation of telecopy
transmission within such period);
provided, however, that this clause (iv) shall not apply to any filing by
the Issuers of any Annual Report on Form 10-K, Quarterly Report on Form 10-Q
or Current Report on Form 8-K with respect to matters unrelated to the
Securities and the offering or exchange therefor.  The objection of an Initial Purchaser or
underwriter, if any, shall be deemed to be reasonable if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to
be filed, contains a material misstatement or omission;

 

(v)     make
available, during normal business hours
upon reasonable prior notice,
for inspection by the Initial Purchasers, the managing underwriter(s), if any,
participating in any disposition pursuant to such Registration Statement and
any attorney

 

9

 

or accountant retained by such Initial Purchasers or any of the
underwriter(s), all financial and other records, pertinent corporate documents
and properties of each of the Issuers and cause the Issuers’ officers,
directors and employees to supply all information reasonably requested by any
such Holder, underwriter, attorney or accountant in connection with such
Registration Statement or any post-effective amendment thereto subsequent to
the filing thereof and prior to its effectiveness and to participate in
meetings with investors to the extent requested by the managing underwriter(s),
if any;

 

(vi)    if
requested by any selling Holders or the underwriter(s), if any, promptly incorporate
in any Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such selling Holders
and underwriter(s), if any, may reasonably request to have included therein,
including, without limitation, information relating to the “Plan of
Distribution” of the Transfer Restricted Securities, information with respect
to the principal amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any other terms of
the offering of the Transfer Restricted Securities to be sold in such offering;
and make all required filings of such Prospectus supplement or post-effective
amendment as soon as practicable after the Issuers are notified of the matters
to be incorporated in such Prospectus supplement or post-effective amendment;

 

(vii)   cause
the Transfer Restricted Securities covered by the Registration Statement to be
rated with the appropriate rating agencies, if so requested by the Holders of a
majority in aggregate principal amount of Securities covered thereby or the
underwriter(s), if any;

 

(viii)  furnish
to each Initial Purchaser, each selling Holder and each of the underwriter(s),
if any, without charge, at least one copy of the Registration Statement, as
first filed with the Commission, and of each amendment thereto, including, if they so request, financial
statements and schedules, all documents incorporated by reference therein and
all exhibits (including exhibits incorporated therein by reference);

 

(ix)    deliver
to each selling Holder and each of the underwriter(s), if any, without charge,
as many copies of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons reasonably may request;
each of the Issuers hereby consents to the use of the Prospectus and any
amendment or supplement thereto by each of the selling Holders and each of the
underwriter(s), if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;

 

(x)     enter
into such agreements (including an underwriting agreement), and make such
representations and warranties, and take all such other actions in connection
therewith in order to expedite or facilitate the disposition of the Transfer
Restricted Securities pursuant to any Shelf
Registration Statement contemplated by this Agreement, all to such
extent as may be requested by any Initial Purchaser or by any Holder of
Transfer Restricted Securities or underwriter in connection with any sale or
resale pursuant to any Shelf
Registration Statement contemplated by this Agreement; and 

 

10

 

whether or not an underwriting agreement is entered into and whether or
not the registration is an Underwritten Registration, each of the Issuers
shall:

 

(A)          furnish
to each Initial Purchaser, each selling Holder and each underwriter, if any, in
such substance and scope as they may request and as are customarily made by
issuers to underwriters in primary underwritten offerings, upon the date of the
effectiveness of the Shelf Registration Statement:

 

(1)           a
certificate, dated the date of effectiveness of the Shelf Registration
Statement signed by (y) the President or any Vice President and (z) a
principal financial or accounting officer of each of the Issuers, confirming,
as of the date thereof, the matters set forth in paragraphs (i), (ii) and (iii) of
Section 4(e) of the Purchase Agreement and such other matters as such
parties may reasonably request;

 

(2)           an
opinion, dated the date of effectiveness of the Shelf Registration Statement of
counsel for the Issuers, covering the
relevant matters set forth in Section 4(c) of the Purchase
Agreement and such other matters as such parties may reasonably request, and in
any event including a statement to the effect that such counsel has
participated in conferences with officers and other representatives of each of
the Issuers, representatives of the independent public accountants for the
Issuers, representatives of the underwriter(s), if any, and counsel to the
underwriter(s), if any, in connection with the preparation of such Registration
Statement and the related Prospectus and have considered the matters required to
be stated therein and the statements contained therein, although such counsel
has not independently verified the accuracy, completeness or fairness of such
statements; and that such counsel advises that, on the basis of the foregoing,
no facts came to such counsel’s attention that caused such counsel to believe
that the applicable Registration Statement, at the time such Registration
Statement or any post-effective amendment thereto became effective contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such Registration Statement as
of its date contained an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in light of the circumstances under which
they were made, not misleading. 
Without limiting the foregoing, such counsel may state further that such
counsel assumes no responsibility for, and has not independently verified, the
accuracy, completeness or fairness of the financial statements, notes and
schedules and other financial data included in any Registration Statement
contemplated by this Agreement or the related Prospectus; and

 

(3)           a
customary comfort letter, dated the date of effectiveness of the Shelf
Registration Statement, from the Issuers’ independent 

 

11

 

accountants, in the customary form and covering matters of the type customarily
requested to be covered in comfort letters by underwriters in connection with
primary underwritten offerings, and covering or affirming the matters set forth
in the comfort letters delivered pursuant to Sections 4(a) and 4(f) of
the Purchase Agreement, without exception;

 

(B)           set
forth in full or incorporate by reference in the underwriting agreement, if
any, the indemnification provisions and procedures of Section 8 hereof
with respect to all parties to be indemnified pursuant to said Section; and

 

(C)           deliver
such other documents and certificates as may be reasonably requested by such
parties to evidence compliance with Section 6(c)(x)(A) hereof and with any customary conditions contained in
the underwriting agreement or other agreement entered into by either of the
Issuers pursuant to this Section 6(c)(x), if any.

 

If
at any time the representations and warranties of the Issuers contemplated in Section 6(c)(x)(A)(1) hereof cease to be true
and correct, the Company or Finance Corp. shall so advise the Initial
Purchasers and the underwriter(s), if any, and each selling Holder promptly
and, if requested by such Persons, shall confirm such advice in writing;

 

(xi)           prior
to any public offering of Transfer Restricted Securities pursuant to a Shelf Registration Statement, cooperate with the
selling Holders, the underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the Transfer Restricted
Securities under the state securities or blue sky laws of such jurisdictions as
the selling Holders or underwriter(s), if any, may request and do any and all
other acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the Shelf
Registration Statement; provided, however,
that neither of the Issuers shall be required to register or qualify as a
foreign corporation where it is not then so qualified or to take any action
that would subject it to the service of process in suits or to taxation, other
than as to matters and transactions relating to the Registration Statement, in
any jurisdiction where it is not then so subject;

 

(xii)          shall
issue, upon the request of any Holder of Transfer Restricted Securities covered
by the Shelf Registration Statement, Exchange Securities having an aggregate
principal amount equal to the aggregate principal amount of Transfer Restricted
Securities surrendered to the Issuers by such Holder in exchange therefor or
being sold by such Holder; such Exchange Securities to be registered in the
name of such Holder or in the name of the purchaser(s) of such Securities,
as the case may be; in return, the Transfer Restricted Securities held by such
Holder shall be surrendered to the Issuers for cancellation;

 

(xiii)         cooperate
with the selling Holders and the underwriter(s), if any, to facilitate the
timely preparation and delivery of certificates representing Transfer
Restricted Securities to be sold and not bearing any restrictive legends; and
enable such Transfer Restricted Securities to be in such denominations and
registered in such names 

 

12

 

as the Holders or the underwriter(s), if any, may request at least two
Business Days prior to any sale of Transfer Restricted Securities made by such
Holders or underwriter(s);

 

(xiv)        use
its reasonable best efforts to cause the Transfer Restricted Securities covered
by the Registration Statement to be registered with or approved by such other United States governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof or the
underwriter(s), if any, to consummate the disposition of such Transfer
Restricted Securities, subject to the proviso contained in Section 6(c)(xii) hereof;

 

(xv)         if
any fact or event contemplated by Section 6(c)(iii)(D) hereof shall
exist or have occurred, prepare a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the circumstances under which
they were made, not misleading;

 

(xvi)        provide
a CUSIP number for all Securities not later than the effective date of the
Registration Statement covering such Securities and provide the Trustee under
the Indenture with printed certificates for such Securities which are in a form
eligible for deposit with the Depository Trust Company and take all other
action necessary to ensure that all such Securities are eligible for deposit
with the Depository Trust Company;

 

(xvii)       cooperate
and assist in any filings required to be made with the FINRA and in the
performance of any due diligence investigation by any underwriter (including
any “qualified independent underwriter”) that is required to be retained in
accordance with the rules and regulations of the FINRA;

 

(xviii)      otherwise
use its reasonable best efforts to comply with all applicable rules and
regulations of the Commission, and make generally available to its security
holders, as soon as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 under the Securities Act (which need not be
audited) for the twelve-month period (A) commencing at the end of any
fiscal quarter in which Transfer Restricted Securities are sold to underwriters
in a firm commitment or best efforts Underwritten Offering or (B) if not
sold to underwriters in such an offering, beginning with the first month of the
Issuers’ first fiscal quarter commencing after the effective date of the
Registration Statement;

 

(xix)         cause
the Indenture to be qualified under the Trust Indenture Act not later than the
effective date of the first Registration Statement required by this Agreement,
and, in connection therewith, cooperate with the Trustee and the Holders of
Securities to effect such changes to the Indenture as may be required for such
Indenture to be so qualified in accordance with the terms of the Trust
Indenture Act; and to execute and use its reasonable best efforts to cause the
Trustee to execute, all documents that may be required to effect such changes
and all other forms and documents required to be filed with the Commission to
enable such Indenture to be so qualified in a timely manner; and

 

 

13

 

(xx)          cause
all Securities covered by the Registration Statement to be listed on each
securities exchange or automated quotation system on which similar securities
issued by the Issuers are then listed if requested by the Holders of a majority
in aggregate principal amount of Securities or the managing underwriter(s), if
any

 

Each Holder agrees by
acquisition of a Transfer Restricted Security that, upon receipt of any notice
from the Issuers of the existence of any fact of the kind described in Section 6(c)(iii)(D) hereof,
such Holder will forthwith discontinue disposition of Transfer Restricted
Securities pursuant to the applicable Registration Statement until such Holder’s
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 6(c)(xvi) hereof, or until it is advised in writing (the “Advice”)
by the Issuers that the use of the Prospectus may be resumed, and has received
copies of any additional or supplemental filings that are incorporated by
reference in the Prospectus.  If so
directed by the Issuers, each Holder will deliver to the Issuers (at the
Issuers’ expense) all copies, other than permanent file copies then in such
Holder’s possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice.  In the event the Issuers shall give any such
notice, the time period regarding the effectiveness of such Registration
Statement set forth in Section 3 or 4 hereof, as applicable, shall be
extended by the number of days during the period from and including the date of
the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to
and including the date when each selling Holder covered by such Registration
Statement shall have received the copies of the supplemented or amended
Prospectus contemplated by Section 6(c)(xvi) hereof or shall have
received the Advice; provided, however,
that no such extension shall be taken into account in determining whether additional interest is due pursuant to
Section 5 hereof or the amount of such additional interest, it being agreed that the Issuer’s option to
suspend use of a Registration Statement pursuant to this paragraph shall be
treated as a Registration Default for purposes of Section 5 hereof.

 

SECTION 7.     Registration
Expenses.

 

(a)           All expenses incident to the Issuers’
performance of or compliance with this Agreement will be borne by the Issuers,
jointly and severally, regardless of whether a Registration Statement becomes
effective, including, without limitation: (i) all registration and filing
fees and expenses (including filings made by any Initial Purchaser or Holder
with the FINRA (and, if applicable, the fees and expenses of any “qualified
independent underwriter” and its counsel that may be required by the rules and
regulations of the FINRA)); (ii) all fees and expenses of compliance with
federal securities and state securities or blue sky laws; (iii) all
expenses of printing (including printing certificates for the Exchange
Securities to be issued in the Exchange Offer and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all fees and
disbursements of counsel for the Issuers and, subject to Section 7(b) hereof,
the Holders of Transfer Restricted Securities; (v) all application and
filing fees in connection with listing the Exchange Securities on a securities
exchange or automated quotation system pursuant to the requirements thereof; (vi) all
fees and disbursements of independent certified public accountants of the
Issuers (including the expenses of any special audit and comfort letters
required by or incident to such performance); (vii) all rating agency
fees; (viii) all fees and disbursements relating to the qualification of
the Indenture under applicable securities laws; and (ix) all fees and
disbursements of the Trustee and its counsel.

 

14

 

Each of the Issuers will, in
any event, bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and expenses
of any Person, including special experts, retained by the Issuers.

 

(b)           In connection with any Registration
Statement required by this Agreement (including, without limitation, the
Exchange Offer Registration Statement and the Shelf Registration Statement),
the Issuers, jointly and severally, will reimburse the Initial Purchasers and
the Holders of Transfer Restricted Securities being tendered in the Exchange
Offer and/or resold pursuant to the “Plan of Distribution” contained in the
Exchange Offer Registration Statement or registered pursuant to the Shelf
Registration Statement, as applicable, for the reasonable fees and
disbursements of not more than one counsel, who shall be Fried, Frank, Harris,
Shriver & Jacobson LLP, or such other counsel as may be chosen by the
Holders of a majority in principal amount of the Transfer Restricted Securities
for whose benefit such Registration Statement is being prepared.

 

SECTION 8.     Indemnification.

 

(a)           Each of the Issuers, jointly and
severally, agrees to indemnify and hold harmless (i) each Initial
Purchaser and Holder and (ii) each Person, if any, who controls (within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) any Initial Purchaser or any Holder (any of the Persons referred
to in this clause (ii) being hereinafter referred to as a “controlling
person”) and (iii) the respective officers, directors, partners,
employees, representatives and agents of any Initial Purchaser or any Holder or
any controlling person (any Person referred to in clause (i), (ii) or (iii) may
hereinafter be referred to as an “Indemnified Holder”), to the fullest extent
lawful, from and against any and all losses, claims, damages, liabilities, judgments,
actions and expenses (including, without limitation, and as incurred,
reimbursement of all reasonable costs of investigating, preparing, pursuing,
settling, compromising, paying or defending any claim or action, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, including the reasonable fees and expenses of not more than one counsel to the Indemnified Holders related to any particular situation),
joint or several, directly or indirectly caused by, related to, based upon,
arising out of or in connection with any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus (or any amendment or supplement thereto), or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading, except insofar as such losses, claims, damages, liabilities or
expenses are caused by an untrue statement or omission or alleged untrue
statement or omission that is made in reliance upon and in conformity with
information relating to any of the Holders furnished in writing to the Issuers
by any of the Holders expressly for use therein.  In connection with any Underwritten Offering
permitted by Section 11, each of the Issuers, jointly and severally, will
also indemnify the Underwriters, if any, selling brokers, dealers and similar
securities industry professional participating in the distribution, their
respective affiliates and each Person, if any, who controls (within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange
Act) such Persons to the same extent as provided above with respect to the
indemnification of the Indemnified Holders, if requested in connection with any

 

15

 

Registration Statement or
Prospectus (or any amendment or supplement thereto). This indemnity agreement
shall be in addition to any liability which any of the Issuers may otherwise
have.

 

In case any action or
proceeding (including any governmental or regulatory investigation or
proceeding) shall be brought or asserted against any of the Indemnified Holders
with respect to which indemnity may be sought against the Issuers, such
Indemnified Holder (or the Indemnified Holder controlled by such controlling
person) shall promptly notify the Issuers in writing; provided, however, that the omission so to
notify the Issuers will not relieve them from any liability which they may have
to any Indemnified Holder hereunder to the extent it is not materially
prejudiced as a proximate result of such failure and in any event shall not
relieve it from any liability which it may have otherwise than under the
indemnity agreement contained in this Section 8.  Such Indemnified Holder shall have the right
to employ its own counsel in any such action and the fees and expenses of such
counsel shall be paid, as incurred, by the Issuers (regardless of whether it is
ultimately determined that an Indemnified Holder is not entitled to
indemnification hereunder).  The Issuers
shall not, in connection with any one such action or proceeding or separate but
substantially similar or related actions or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) at any time for such Indemnified
Holders.  Any such separate firm (i) for
any Initial Purchaser, its respective officers, directors, partners, employees,
representatives and agents and any control Persons of such Initial Purchaser
shall be designated in writing by J.P. Morgan Securities LLC and (ii) for
any Holder, its respective officers, directors, partners, employees,
representatives and agents and any control Persons of such Holder shall be
designated in writing by the Holders of a majority in aggregate principal
amount of the Transfer Restricted Securities held by Indemnified Holders.  The Issuers shall be liable for any
settlement of any such action or proceeding effected with the Issuers’ prior
written consent, which consent shall not be withheld unreasonably, and each of
the Issuers agrees to indemnify and hold harmless any Indemnified Holder from
and against any loss, claim, damage, liability or expense by reason of any
settlement of any action effected with the written consent of the Issuers.  The Issuers shall not, without the prior
written consent of each Indemnified Holder, settle or compromise or consent to
the entry of judgment in or otherwise seek to terminate any pending or
threatened action, claim, litigation or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not any
Indemnified Holder is a party thereto), unless such settlement, compromise,
consent or termination (i) includes an unconditional release of each
Indemnified Holder from all liability arising out of such action, claim,
litigation or proceeding and (ii) does not include any statement as to any
admission of fault, culpability or a failure to act by or on behalf of any
Indemnified Holder.

 

(b)           Each Holder of Transfer Restricted
Securities agrees, severally and not jointly, to indemnify and hold harmless
each of the Issuers and their respective directors, officers of the Issuers who
sign a Registration Statement, and any Person controlling (within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange
Act) either such Issuer, the respective officers, directors, partners,
employees, representatives and agents of each such Person, the Initial
Purchasers and the other selling Holders and any Person controlling (within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) any Initial Purchasers or any other selling Holder, to the same
extent as the foregoing indemnity from the Issuers to each of the Indemnified
Holders, but only with respect to claims and actions based

 

16

 

upon any untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with information relating to such Holder furnished in writing by
such Holder expressly for use in any Registration Statement or Prospectus.  In case any action or proceeding shall be
brought against either Issuer or their respective directors or officers or any
such controlling person in respect of which indemnity may be sought against a
Holder of Transfer Restricted Securities or an Initial Purchaser, such Holder
or Initial Purchaser shall have the rights and duties given such Issuer, and
its directors and officers and such controlling person shall have the rights
and duties given to each Holder and Initial Purchaser by the preceding paragraph.

 

(c)           If the indemnification provided for
in this Section 8 is unavailable to an indemnified party under Section 8(a) or
(b) hereof (other than by reason of exceptions provided in those Sections)
or insufficient in respect of any losses, claims, damages, liabilities,
judgments, actions or expenses referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or expenses in such proportion as
is appropriate to reflect the relative benefits received by the Issuers, on the
one hand, and the Holders, on the other hand, from the Initial Placement (which
in the case of the Issuers shall be deemed to be equal to the total net proceeds to the Issuers from the
Initial Placement), the amount of Additional Interest which did not become
payable as a result of the filing of the Registration Statement resulting in
such losses, claims, damages, liabilities, judgments actions or expenses, and
such Registration Statement, or if such allocation is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to above, but also the relative fault of the
Issuers, on the one hand, and the Holders, on the other hand, in connection
with the statements or omissions which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations.  The relative fault of
the Issuers on the one hand and of the Indemnified Holder on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by either of the Issuers,
on the one hand, or the Indemnified Holders, on the other hand, and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.  The
amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include, subject
to the limitations set forth in the second paragraph of Section 8(a) hereof,
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim.

 

Each of the Issuers and each
Holder of Transfer Restricted Securities agree that it would not be just and
equitable if contribution pursuant to this Section 8(c) were
determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph.  The amount paid or
payable by an indemnified party as a result of the losses, claims, damages,
liabilities or expenses referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 8,
none of the Holders (and its related Indemnified Holders) shall be required to 

 

17

 

contribute, in the
aggregate, any amount in excess of the amount by which the total discount or
proceeds received by such Holder with respect to the Transfer Restricted
Securities exceeds the amount of any damages which such Holder has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission.  No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.  The Holders’ obligations to contribute
pursuant to this Section 8(c) are several in proportion to the
respective principal amount of Transfer Restricted Securities held by each of
the Holders hereunder and not joint.

 

(d)           The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies that may otherwise be available
to the Issuers or any Indemnified Holder at law or equity.

 

(e)           The indemnity and contribution provisions contained in
this Section 8 shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of the Initial Purchasers or any Holder or
any Person controlling any Initial Purchaser or any Holder, or by or on behalf
of the Issuers or the officers, directors, partners, employees, representatives
and agents of or any Person controlling the Issuers, (iii) acceptance of
any of the Exchange Securities and (iv)  any sale of Transfer Restricted
Securities pursuant to a Shelf Registration Statement.

 

SECTION 9.     Rule 144A.

 

Each
of the Issuers hereby agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
from such Holder or beneficial owner, the information required by Rule 144A(d)(4) under
the Securities Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A under the Securities Act.

 

SECTION 10.        Participation in Underwritten Registrations.

 

No
Holder may participate in any Underwritten Registration hereunder unless such
Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on
the basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and
executes all reasonable questionnaires, powers of attorney, indemnities,
underwriting agreements, lock-up letters and other documents required under the
terms of such underwriting arrangements.

 

SECTION 11.   Selection of Underwriters.

 

The
Holders of Transfer Restricted Securities covered by the Shelf Registration
Statement who desire to do so may sell such Transfer Restricted Securities in
an Underwritten Offering.  In any such
Underwritten Offering, the investment banker(s) and managing underwriter(s) that
will administer such offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering; 

 

18

 

provided, however, that such
investment banker(s) and managing underwriter(s) must be reasonably
satisfactory to the Issuers.

 

SECTION 12.   Miscellaneous.

 

(a)           Remedies.  Each of the Issuers hereby agrees
that monetary damages would not be adequate compensation for any loss incurred
by reason of a breach by it of the provisions of this Agreement and hereby
agree to waive the defense in any action for specific performance that a remedy
at law would be adequate.

 

(b)           No
Inconsistent Agreements.  Each
of the Issuers will not on or after the date of this Agreement enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof.  Neither of the
Issuers has previously entered into any agreement granting any registration
rights with respect to its securities to any Person.  The rights granted to the Holders hereunder
do not in any way conflict with and are not inconsistent with the rights
granted to the holders of the any of the Issuers’ securities under any
agreement in effect on the date hereof.

 

(c)           Adjustments
Affecting the Securities.  The
Issuers will not take any action with respect to the Securities that would
materially and adversely affect the ability of the Holders to Consummate any
Exchange Offer to the extent such
Exchange Offer is required to and can be Consummated pursuant to the terms
hereof.

 

(d)           Amendments
and Waivers.  The provisions
of this Agreement may not be amended, modified or supplemented, and waivers or
consents to or departures from the provisions hereof may not be given unless
the Issuers have (i) in the case of Section 5 hereof and this Section 12(d)(i),
obtained the written consent of Holders of all outstanding Transfer Restricted
Securities and (ii) in the case of all other provisions hereof, obtained
the written consent of Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities (excluding any Transfer Restricted
Securities held by the Issuers or their respective Affiliates).  Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal amount
of Transfer Restricted Securities being tendered or registered; provided, however, that, with respect to
any matter that directly or indirectly affects the rights of any Initial
Purchaser hereunder, the Issuers shall obtain the written consent of each such
Initial Purchaser with respect to which such amendment, qualification,
supplement, waiver, consent or departure is to be effective.

 

(e)           Notices.  All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return receipt
requested), telex, telecopier, or air courier guaranteeing overnight delivery:

 

(i)      if to
a Holder, at the address set forth on the records of the Registrar under the
Indenture, with a copy to the Registrar under the Indenture; and

 

(ii)     if to
the Issuers:

 

19

 

	
   

  	
  Ferrellgas,
  L.P.

  
	
   

  	
  One
  Liberty Plaza

  
	
   

  	
  Liberty,
  MO 64068

  
	
   

  	
  Facsimile:
  (913) 661-1537

  
	
   

  	
  Attention:
  Ryan VanWinkle

  
	
   

  	
   

  
	
   

  	
  With
  a copy to:

  
	
   

  	
   

  
	
   

  	
  Greenberg
  Traurig, LLP

  
	
   

  	
  1000
  Louisiana, Suite 1700

  
	
   

  	
  Houston,
  Texas 77002

  
	
   

  	
  Facsimile: (713) 754-6625

  
	
   

  	
  Attention: David Ronn, Esq.

  

 

All such notices and
communications shall be deemed to have been duly given:  at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and on the next Business Day, if timely delivered to an air
courier guaranteeing overnight delivery.

 

Copies of all such notices,
demands or other communications shall be concurrently delivered by the Person
giving the same to the Trustee at the address specified in the Indenture.

 

(f)            Successors
and Assigns.  This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties, including, without limitation, and without the need for an
express assignment, subsequent Holders of Transfer Restricted Securities; provided, however, that this Agreement
shall not inure to the benefit of or be binding upon a successor or assign of a
Holder unless and to the extent such successor or assign acquired Transfer
Restricted Securities from such Holder.

 

(g)           Counterparts.  This Agreement may be executed in
any number of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.

 

(h)           Headings.  The headings in this Agreement are
for convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

 

(i)            Governing
Law.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF.

 

(j)            Severability.  In the event that any one or more
of the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity, legality
and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.

 

20

 

(k)           Entire
Agreement.  This Agreement is
intended by the parties as a final expression of their agreement and intended
to be a complete and exclusive statement of the agreement and understanding of
the parties hereto in respect of the subject matter contained herein.  There are no restrictions, promises, warranties
or undertakings, other than those set forth or referred to herein with respect
to the registration rights granted by the Issuers with respect to the Transfer
Restricted Securities.  This Agreement
supersedes all prior agreements and understandings among the parties with respect to such subject matter.

 

21

 

IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first written above.

 

	
   

  	
  FERRELLGAS, L.P.

  
	
   

  	
   

  
	
   

  	
  By: Ferrellgas, Inc.,
  its general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. RYAN VANWINKLE

  
	
   

  	
   

  	
  J.
  Ryan VanWinkle

  
	
   

  	
   

  	
  Senior
  Vice President & Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FERRELLGAS FINANCE CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. RYAN VANWINKLE

  
	
   

  	
   

  	
  J.
  Ryan VanWinkle

  
	
   

  	
   

  	
  Chief
  Financial Officer and Sole Director

  

 

22

 

The foregoing Registration
Rights Agreement is hereby confirmed and accepted as of the date first above
written:

 

	
   

  	
   

  
	
  J.P. MORGAN SECURITIES LLC

  	
   

  
	
  MERRILL LYNCH, PIERCE,
  FENNER & SMITH

  	
   

  
	
   

  	
  INCORPORATED

  	
   

  
	
  WELLS FARGO SECURITIES,
  LLC

  	
   

  
	
  BARCLAYS CAPITAL INC.

  	
   

  
	
  BNP PARIBAS SECURITIES
  CORP.

  	
   

  
	
  CAPITAL
  ONE SOUTHCOAST, INC.

  	
   

  
	
  FIFTH
  THIRD SECURITIES, INC.

  	
   

  
	
  PNC
  CAPITAL MARKETS LLC

  	
   

  
	
  SG AMERICAS SECURITIES, LLC

  	
   

  
	
  UBS
  SECURITIES LLC

  	
   

  
	
  U.S. BANCORP INVESTMENTS, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  J.P. MORGAN SECURITIES LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ ROBERT C. MERTENSOTTO

  	
   

  
	
   

  	
  Name: Robert C.
  Mertensotto

  	
   

  
	
   

  	
  Title: Managing Director

  	
   

  
				

 

23

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]