Document:

crk-ex42_8.htm

Exhibit 4.2

 

 

COMSTOCK RESOURCES, INC.,

EACH OF THE SUBSIDIARY GUARANTORS PARTY HERETO

and

American Stock Transfer & Trust Company, LLC,

as Trustee

 

 

 

 

SECOND SUPPLEMENTAL INDENTURE

dated as of July 13, 2018

to

INDENTURE

dated as of September 6, 2016

 

 

 

91⁄2% Convertible Secured PIK Notes due 2020

 

 

 

This SECOND SUPPLEMENTAL INDENTURE, dated as of July 13, 2018 (this “Supplemental Indenture”) is among COMSTOCK RESOURCES, INC., a Nevada corporation (hereinafter called the “Company”), the SUBSIDIARY GUARANTORS named on the signature pages hereto and AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC (hereinafter called the “Trustee”) under the Indenture, dated as of September 6, 2016, among the Company, the Subsidiary Guarantors from time to time party thereto and the Trustee (as heretofore amended, supplemented or otherwise modified, the “Indenture”). Capitalized terms used in this Supplemental Indenture and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture.

RECITALS

WHEREAS, pursuant to the Indenture, the Company issued its 91⁄2% Convertible Secured PIK Notes due 2020 (the “Notes”);

WHEREAS, Section 9.01(a)(2) of the Indenture provides that the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, without the consent of the Holders of the Notes, to surrender any right or power conferred in the Indenture upon the Company, and Section 9.01(a)(4) of the Indenture provides that the Company, the Subsidiary Guarantors and the Trustee may amend or supplement the Indenture, without the consent of the Holders of the Notes, to cure any ambiguity, correct or supplement any provision in the Indenture which may be inconsistent with any other provision of the Indenture, or to make any other provisions with respect to matters or questions arising under the Indenture, provided that such action does not adversely affect the interests of any Holder;

WHEREAS, the Company desires to amend certain provisions of the Indenture, as set forth in Article I of this Supplemental Indenture; 

WHEREAS, all acts and things prescribed by the Indenture, by law and by the Restated Articles of Incorporation and the Bylaws (or comparable constituent documents) of the Company, of the Subsidiary Guarantors and of the Trustee necessary to make this Supplemental Indenture a valid instrument legally binding on the Company, the Subsidiary Guarantors and the Trustee, in accordance with its terms, have been duly done and performed;

WHEREAS, the Company hereby requests that the Trustee join with the Company and the Subsidiary Guarantors in the execution of this Supplemental Indenture;

NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained herein, and for other good and valuable consideration, the receipt of which is hereby acknowledged, and for the equal and proportionate benefit of the Holders of the Notes, each party hereto hereby agree as follows: 

1

ARTICLE I

AMENDMENTS TO INDENTURE 

Section 1.01Amendment to Article 12. The Indenture is hereby amended as follows: 

(a)Section 12.01(b) of the Indenture is hereby amended by deleting in its entirety the first sentence thereof and replacing it with the following:

Following the receipt of the Required Stockholder Approval and the effectiveness of the Charter Amendment, the Company shall convert (the “Mandatory Conversion”) any outstanding Notes into a number of shares of Common Stock per $1,000 principal amount of Notes equal to the Conversion Rate then in effect (plus cash in lieu of fractional shares) if the Daily VWAP of the Common Stock exceeds or is equal to the Threshold Price in effect on each applicable Trading Day for at least 15 consecutive Trading Days, which 15 consecutive Trading Day period shall not commence prior to the earlier of (i) October 12, 2018 and (ii) the termination of the Contribution Agreement, dated May 9, 2018 by and among Arkoma Drilling, L.P., Williston Drilling, L.P. and the Company (the “Mandatory Conversion Event”). 

 Section 1.02No Other Amendments. Except as amended in this Article I, all provisions of the Indenture remain in full force and effect.

ARTICLE II 

MISCELLANEOUS 

Section 2.01Instruments To Be Read Together. This Supplemental Indenture is executed as and shall constitute an indenture supplemental to and in implementation of the Indenture, and said Indenture and this Supplemental Indenture shall henceforth be read together. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes shall be bound hereby and thereby. 

Section 2.02Confirmation. The Indenture as amended and supplemented by this Supplemental Indenture is in all respects confirmed and preserved. 

Section 2.03Headings. The headings of the Articles and Sections of this Supplemental Indenture have been inserted for convenience of reference only, and are not to be considered a part hereof and shall in no way modify or restrict any of the terms and provisions hereof. 

Section 2.04Effectiveness. This Supplemental Indenture shall become effective on the date first above written. 

Section 2.05Acceptance by Trustee. The Trustee accepts the amendments to the Indenture effected by this Supplemental Indenture and agrees to execute the trusts created by the Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture. This Supplemental Indenture constitutes a Company Request in accordance with Section 9.01(a) of the Indenture.

2

Section 2.06Responsibility of Trustee. The recitals and statements contained herein shall be taken as the statements of the Company and the Subsidiary Guarantors, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity, adequacy or sufficiency of this Supplemental Indenture.

Section 2.07Successors and Assigns. All covenants and agreements in this Supplemental Indenture by the Company and the Subsidiary Guarantors shall bind their respective successors and assigns, whether so expressed or not. All agreements of the Trustee in this Supplemental Indenture shall bind its successor.

Section 2.08Severability.  In case any provision in this Supplemental Indenture or in the Notes or the Subsidiary Guarantees shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby, and a Holder shall have no claim therefor against any party hereto.

Section 2.09 Benefits of Supplemental Indenture.  Nothing in this Supplemental Indenture, express or implied, shall give to any Person (other than the parties hereto, any Paying Agent, any Registrar and their successors hereunder and the Holders) any benefit or any legal or equitable right, remedy or claim under this Supplemental Indenture.

Section 2.10Governing Law. THIS SUPPLEMENTAL INDENTURE IS GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Section 2.12Counterparts. The parties hereto may sign any number of copies of this Supplemental Indenture. This Supplemental Indenture may be signed in counterparts and by the different parties hereto in separate counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or portable document format (.pdf) transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signature of the parties hereto transmitted by facsimile or .pdf shall be deemed to be their original signatures for all purposes.

 

[Signature pages follow]

3

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

Company:

Comstock Resources, Inc.

 

 

	
 
	
By:
	
/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

	
 
	
Title:
	
President

Subsidiary Guarantors:

Comstock Oil & Gas, LP

 

By:Comstock Oil & Gas GP, LLC,
its general partner

 

By:Comstock Resources, Inc.,
its sole member

 

 

By:/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

Title:President

 

 

Comstock Oil & Gas - Louisiana, LLC

 

 

By:/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

Title:President

 

 

Comstock Oil & Gas GP, LLC

 

 

By:/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

Title:President

[Signature Page to Comstock Resources, Inc. Second Supplemental Indenture]

Comstock Oil & Gas Investments LLC

 

 

By:/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

Title:Manager

 

Comstock Oil & Gas Holdings, Inc.

 

 

By:/s/ ROLAND O. BURNS

	
 
	
Name:
	
Roland O. Burns

Title:President 

Trustee:

American Stock Transfer & Trust Company, LLC, as Trustee

	
 
	
By:
	
/s/ PAUL H. KIM

Name: Paul H. Kim

Title: Asst. General Counsel

[Signature Page to Comstock Resources, Inc. Second Supplemental Indenture]Exhibit 4.1

 

THE ISSUANCE AND SALE OF THE SECURITY REPRESENTED BY THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITY MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (i) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITY UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL, IN A FORM GENERALLY ACCEPTABLE TO THE COMPANY’S LEGAL COUNSEL, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (ii) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.

 

DEMAND PROMISSORY NOTE

 

	$6,806,849.55	July 13, 2018
	 	New York, New York

 

FOR
VALUE RECEIVED, Helios and Matheson Analytics Inc., a Delaware corporation (the “Maker”), promises
to pay to the order of  Hudson Bay Master Fund Ltd or its assigns (“Holder”), the principal amount
of $6,806,849.55 (Six million, eight hundred and six thousand, eight hundred and forty nine dollars and .55 cents) (the
“Principal”), which includes $5,000,000 in cash borrowed by the Maker from the Holder on the date hereof
and $1,806,849.55 required to be paid by the Maker to the Holder pursuant to that certain redemption notice, dated July 10,
2018 pursuant to that certain Series B-2 Note (the “June Note”) issued by the Maker to the Holder on June
26, 2018. The Maker also agrees to pay interest (computed on the basis of a 360-day year of twelve 30-day months) on the
unpaid principal balance from the date hereof, at a simple rate per annum (calculated on the basis of a 365-day year) equal
to ten percent (10%), payable as set forth below, provided that in no event shall the rate of interest hereunder exceed the
maximum rate permitted by applicable law.

 

1. Payment
on Demand. The entire unpaid Principal of this demand promissory note (this “Note”), together with
accrued and unpaid interest hereunder, shall be due and payable at any time, or from time to time, upon a demand made by Holder
for any reason or no reason from and after the date hereof. All demands for repayment received by the Maker prior to 3:00 P.M.
New York city time on a given business day shall be paid to the Holder on such given business day. All demands for repayment received
by the Maker after 3:00 P.M. New York city time on a given business day shall be paid to the Holder on the immediately following
business day. The Maker will pay to the Holder of this Note on demand such further amount as shall be sufficient to cover all
costs and expenses of such Holder incurred in the drafting and negotiation of this Note and all costs and expenses of any enforcement
or collection of this Note, including, without limitation, reasonable attorneys’ fees, expenses and disbursements. Payments
shall be credited first to the accrued interest then due and payable and the remainder applied to Principal.

 

     

     

    

 

2. Prepayment;
Mandatory Prepayment. Prepayment of principal, together with accrued interest, may be made at any time without notice, premium
or penalty. With the agreement of Holder, the Principal and accrued interest under this Note may be applied to all, or any part,
of the purchase price of securities to be issued upon the consummation after the date hereof of an offering of securities by Maker
to Holder. At any time any amounts remain outstanding hereunder, all proceeds from the ATM (as defined in the June Note) (the “ATM
Proceeds”) shall be used to repay this Note (as defined below), pro rata (such portion of any given ATM Proceeds required
to be mandatorily paid to the Holder hereunder, each an “ATM Mandatory Payment”). Any ATM Mandatory Payment
received by the Maker prior to 3:00 P.M. New York city time on a given date shall be paid to the Holder on such given date. Any
ATM Mandatory Payment received by the Maker after 3:00 P.M. New York city time on a given date shall be paid to the Holder on
the immediately following business day. All ATM Mandatory Payments shall be made in U.S. dollars and immediately available funds
in accordance with the wire transfer instructions of the Holder delivered to the Maker on or prior to such applicable payment
date. The Maker shall deliver written notice of any transactions with respect to the ATM as soon as commercially practicable following
the close of the Nasdaq Capital Market on such date of determination, but in no event later than 9:00 AM, New York city time,
on the calendar day immediately following the date of such transaction.

 

3. Representations
and Warranties of Maker. Maker represents and warrants as follows as of the date hereof: (a) it is duly organized, validly
existing and in good standing under the laws of its state of Delaware; (b) the execution, delivery and performance by Maker
of this Note are within Maker's powers, have been duly authorized by all necessary actions, and do not contravene its governing
agreements, certificates or other organization documents, and do not contravene any law or any contractual restriction binding
on or affecting Maker; (c) no authorization or approval or other action by, and no notice to or filing with any governmental
authority or regulatory body is required for the due execution, delivery and performance by Maker of this Note; (d) this
Note constitutes the legal, valid and binding obligation of Maker party thereto, enforceable against Maker in accordance with
its terms, except to the extent enforceability is limited by bankruptcy, insolvency, fraudulent conveyance, moratorium and other
laws for the protection of creditors generally and by general equitable principles; (e) after receipt of all cash amounts to be
paid to the Maker on the date hereof pursuant to this Note, the Maker and MoviePass expect to have sufficient capital for operations
through at least July 18, 2018; (f)  there is no pending or, to Maker's knowledge, threatened action or proceeding
affecting Maker before any governmental agency or arbitrator with respect to the transactions contemplated by this Note or which
may materially adversely affect the property, assets or condition (financial or otherwise) of Maker, and (g) neither Maker nor
MoviePass is under any obligation to pay any broker fee or commission in respect of the $5,000,000 borrowed by Maker from Holder
on the date hereof that has not been waived as of the date hereof.

 

4. Late
Charges. Any amount of principal or other amounts due under the Loan Documents which is not paid when due shall result in
a late charge being incurred and payable by the Maker in an amount equal to interest on such amount at the rate of fifteen percent
(15%) per annum from the date such amount was due until the same is paid in full.

 

    	 	-2-	 

     

    

 

5. Use
of Proceeds. Maker shall immediately on the date hereof pay the proceeds of this Note to fund the general working capital
of MoviePass, Inc., a Delaware corporation (“MoviePass”) under Maker’s previously executed option to
acquire common equity of MoviePass, and not for any other purpose other than counsel fees of the Holder and Maker.

 

6. Grant
of Security Interest; Guaranty. The Maker hereby grants and pledges to the Holder a continuing security interest in the ATM
Proceeds, including any and all cash, proceeds, funds, credits, rights and other assets therein or arising therefrom, from time
to time, and any additions, dividends, profits and interest in the foregoing and any replacements or substitutions therefore (collectively,
the “Collateral”) to secure prompt repayment of any and all amounts outstanding hereunder from time to time
and to secure prompt performance by the Maker of each of its covenants and duties under this Note. Such security interest constitutes
a valid, first priority security interest in the Collateral, and will constitute a valid, first priority security interest in
later-acquired Collateral. Notwithstanding any filings undertaken related to the Holder’s rights under the Delaware Uniform
Commercial Code, the Holder’s Lien on the Collateral shall remain in effect for so long as this Note remains outstanding.
No later than the business day following the date of this Note, MoviePass shall execute and deliver the guaranty, in the form
attached hereto as Exhibit A, pursuant to which MoviePass shall guaranty all payment obligations of Maker hereunder.

 

7. Disclosure.
The Maker shall, on or before 10:30 a.m., New York City time on July 13, 2018, file a Current Report on Form 8-K describing this
Note and the transactions contemplated hereby in the form required by the Securities Exchange Act of 1934, as amended, and attaching
the form of this Amendment as an exhibit to such filing (including all attachments, the “8-K Filing”). From
and after the filing of the 8-K Filing, the Maker shall have disclosed all material, non-public information (if any) provided
up to such time to the Holder by the Maker or any of its Subsidiaries or any of their respective officers, directors, employees
or agents. In addition, effective upon the filing of the 8-K Filing, the Maker acknowledges and agrees that any and all confidentiality
or similar obligations under any agreement with respect to the transactions contemplated hereby or as otherwise disclosed in the
8-K Filing, whether written or oral, between the Maker, any of its Subsidiaries or any of their respective officers, directors,
affiliates, employees or agents, on the one hand, and any of the Holder or any of their affiliates, on the other hand, shall terminate.
Neither the Maker, its Subsidiaries nor the Holder shall issue any press releases or any other public statements with respect
to the transactions contemplated hereby; provided, however, the Maker shall be entitled, without the prior approval of the Holder,
to make a press release or other public disclosure with respect to such transactions (i) in substantial conformity with the 8-K
Filing and contemporaneously therewith or (ii) as is required by applicable law and regulations (provided that in the case of
clause (i) the Holder shall be consulted by the Maker in connection with any such press release or other public disclosure prior
to its release). Without the prior written consent of the Holder (which may be granted or withheld in the Holder’s sole
discretion), except as required by applicable law, the Maker shall not (and shall cause each of its Subsidiaries and affiliates
to not) disclose the name of the Holder in any filing, announcement, release or otherwise.

 

    	 	-3-	 

     

    

 

8. Indemnification.
Maker hereby indemnifies and holds harmless Holder, each of its affiliates and correspondents and each of their respective directors,
officers, employees, agents and advisors (each an “Indemnified Party”) from and against any and all actions,
claims, damages, losses, liabilities, fines, penalties, costs and expenses of any kind (including, without limitation, counsel
fees and disbursements in connection with any subpoena, investigative, administrative or judicial proceeding, whether or not the
Indemnified Party shall be designated a party thereto) which may be incurred by the Indemnified Party or which may be claimed
against the Indemnified Party by any person by reason of or in connection with the execution, delivery or performance of this
Note, or action taken or omitted to be taken by Holder under, this Note. Nothing in this paragraph is intended to limit Maker’s
obligations contained elsewhere in this Note. Without prejudice to the survival of any other obligation of Maker hereunder, the
indemnities and obligations of Maker contained in this paragraph shall survive the payment in full of all obligations hereunder.

 

9. No
Distributions. Other than the cash proceeds of this Note, the Maker shall not, directly or indirectly, transfer (whether by
wire transfer, check, contribution, purchase of securities or any assets of a Subsidiary, intercompany loan or otherwise) any cash
or other assets to any Subsidiary of the Maker as long as this Note remains outstanding.

 

 10. Miscellaneous.

 

(a) All
amounts to be paid by hereunder shall be paid when due by wire transfer in United States dollars and immediately available funds
in accordance with the wire instructions delivered to such party entitled to receive such payment prior to such date; provided,
that the Principal shall be paid by Holder directly to MoviePass on the date hereof.

 

(b) If
any payment on this Note shall become due on a Saturday, Sunday or a bank or legal holiday, such payment shall be made on the next
succeeding business day.

 

(c) No
course of dealing and no delay on the part of the Holder of this Note in exercising any right, power or remedy shall operate as
a waiver thereof or otherwise prejudice such Holder’s rights, powers or remedies. No right, power or remedy conferred by
this Note upon the Holder hereof shall be exclusive of any other right, power or remedy referred to herein or now or hereafter
available at law, in equity, by statute or otherwise.

 

(d) Maker
hereby waives presentment, protest and demand, notice of protest, demand and dishonor and nonpayment of this Note.

 

    	 	-4-	 

     

    

 

(e) If
interest or other amounts payable under this Note is in excess of the maximum permitted by law, the interest or other amounts chargeable
hereunder shall be reduced to the maximum amount permitted by law and any excess over the maximum amount permitted by law shall
be credited to the principal balance of this Note and applied to the same and not to the payment of interest or such other amounts,
as applicable.

 

(f) The
Borrower hereby (i) irrevocably submits to the jurisdiction of any Illinois State or Federal court sitting in Chicago, Illinois
in any action or proceeding arising out of or relating to this Note, (ii) waive any defense based on doctrines of venue or
forum non conveniens, or similar rules or doctrines and (iii) irrevocably agree that all claims in respect of such an action
or proceeding may be heard and determined in such Illinois State or Federal court. This Note shall be governed by, and construed
in accordance with, the laws of the State of Illinois. Maker HEREBY waiveS any right
to trial by jury in any action, proceeding or counterclaim arising out of or relating to this Note.

 

(g) This
Note shall be binding upon and inure to the benefit of Maker and Holder and their respective successors, assigns, heirs and legal
representations, except that Maker may not assign any rights or obligations hereunder without the prior written consent of Holder.
Holder may assign to other affiliated entities all or a portion of its rights under this Note.

 

(h) Maker
acknowledges that the transaction of which this Note is a part is a commercial transaction and hereby waives its right to any notice
and hearing as may be allowed by any state or federal law with respect to any prejudgment remedy which any Holder or its successors
or assigns may use.

 

(i) Maker
hereby agrees to pay on demand all reasonable costs and expenses (including, without limitation, all reasonable fees, expenses
and other client charges of counsel to Holder) incurred by Holder in connection herewith and with the enforcement of Holder's
rights, and the collection of all amounts due, hereunder. The Holder of this Note may proceed to protect and enforce the rights
of such Holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any
agreement contained herein, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise
of any power granted hereby or thereby or by law or otherwise.

 

(j) If
this Note is lost or destroyed, Maker shall, at Holder's request, execute and return to Holder a replacement promissory note identical
to this Note. No replacement of this Note shall result in a novation of Maker's obligations under this Note. Maker acknowledges
the need to act promptly upon its receipt of the documentation evidencing any request by Holder that the Note be replaced pursuant
to this paragraph and agrees that Maker will meet the reasonable deadlines of Holder provided that Maker has received the applicable
documents at least ten (10) business days prior to such deadline. Furthermore, Maker agrees to reasonably cooperate with Holder
to effectuate the obtainment of such title policy endorsements, or new title evidence and other assurances and documents as Holder
shall reasonably require.

 

    	 	-5-	 

     

    

 

IN WITNESS WHEREOF,
this Note has been executed as of the date first written above.

 

	 	HELIOS AND MATHESON ANALYTICS INC.
	 	 
	 	By:	/s/ Theodore Farnsworth
	 	 	Name: Theodore Farnsworth
	 	 	Title: Chief Executive Officer

 

Agreed
and accepted by:

 

Hudson
Bay Master Fund Ltd

 

	By:	/s/ George Antonopoulos	 
	 	Name: George Antonopoulos	 
	 	Title: Authorized Signatory	 

 

    	 	-6-

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