Document:

Exhibit 10.2

 

Execution Version

 

ASSET PURCHASE AGREEMENT

 

 

by and between

 

 

WESTERN REFINING PIPELINE COMPANY, as Seller

 

 

and

 

 

PLAINS PIPELINE, L.P., as Buyer

 

 

 

Dated November 30, 2011

 

 

  

  

  

 

TABLE OF CONTENTS

 

 Page

 

 

	
ARTICLE I

	  
	
SALE AND PURCHASE OF ASSETS, ASSUMPTION OF LIABILITIES AND CONSIDERATION

 

	  
	
1.1

	
Sale and Purchase of Assets

	
1

	
1.2

	
Excluded Assets

	
2

	
1.3

	
Assumption of Liabilities

	
3

	
1.4

	
Consideration

	
5

	
1.5

	
Pipeline Reactivation Adjustment

	
5

	
1.6

	
Adjustments to Purchase Price

	
5

	
1.7

	
Non-Assignment of Certain Acquired Assets

 

	
5

	
ARTICLE II

	  
	
CLOSING

 

	  
	
2.1

	
Closing

	
6

	
2.2

	
Deliveries by Seller

	
6

	
2.3

	
Deliveries by Buyer

	
8

	
2.4

	
Prorations.

	
8

	
2.5

	
Closing Costs; Transfer Taxes and Fees

 

	
9

	
ARTICLE III

	  
	
REPRESENTATIONS AND WARRANTIES OF SELLER

 

	  
	
3.1

	
Organization

	
10

	
3.2

	
Authorization

	
10

	
3.3

	
No Conflicts; Consents

	
10

	
3.4

	
Compliance With Laws and Permits

	
11

	
3.5

	
Absence of Litigation

	
11

	
3.6

	
Absence of Changes

	
11

	
3.7

	
Title to Acquired Assets

	
11

	
3.8

	
Contracts

	
12

	
3.9

	
Taxes

	
12

	
3.10

	
Employees

	
12

	
3.11

	
Environmental Matters

	
12

	
3.12

	
No Brokers or Finders

	
14

	
3.13

	
Sufficiency of Assets

	
14

	
3.14

	
Intellectual Property

	
14

	
3.15

	
WAIVERS AND DISCLAIMERS

	
14

	
3.16

	
Survival

 

	
15

 

 

  

i

  

 

	
ARTICLE IV

	  
	
REPRESENTATIONS AND WARRANTIES OF THE BUYER

	  
	
4.1

	
Organization

	
15

	
4.2

	
Authorization

	
15

	
4.3

	
No Violations; Consents

	
16

	
4.4

	
Absence of Litigation

	
16

	
4.5

	
No Brokers and Finders

	
16

	
4.6

	
Due Diligence

	
16

	
4.7

	
Sufficient Funds

 

	
16

	
ARTICLE V

	  
	
COVENANTS AND AGREEMENTS OF SELLER

	  
	
5.1

	
Pre-Closing Access and Information

	
17

	
5.2

	
Conduct of Business

	
17

	
5.3

	
Schedules

 

	
18

	
ARTICLE VI

	  
	
COVENANTS AND AGREEMENTS OF BUYER

	  
	
6.1

	
Pre-Closing Access and Inspections

	
18

	
6.2

	
Post-Closing Preservation of Books and Records; Access

	
19

	
6.3

	
Cooperation for Retained Claims

	
20

	
6.4

	
Excluded Intellectual Property

	
20

	
6.5

	
Performance Bonds and Guaranties

	
20

	
6.6

	
Insurance

	
20

	
6.7

	
Crude Oil Purchasing Agreement

 

	
21

	
ARTICLE VII

	  
	
COVENANTS AND AGREEMENTS OF SELLER AND BUYER

	  
	
7.1

	
Expenses

	
21

	
7.2

	
Injunctions

	
21

	
7.3

	
Payments Received

	
21

	
7.4

	
[Reserved]

	
21

	
7.5

	
HSR Matters

	
21

	
7.6

	
Public Announcements

	
22

	
7.7

	
Confidentiality

	
22

	
7.8

	
Notice of Certain Events

	
22

	
7.9

	
Further Assurances

	
23

	
7.10

	
Tax Matters

	
23

	
7.11

	
Real Estate Matters

	
25

	
7.12

	
Casualty Loss

	
25

	
7.13

	
ROW

 

	
26

 

 

  

ii

  

 

	
ARTICLE VIII

	  
	
[Reserved]

 

	  
	
ARTICLE IX

	  
	
CONDITIONS TO CLOSING

	  
	
9.1

	
Conditions to Each Party’s Obligation to Close

	
27

	
9.2

	
Conditions to Buyer’s Obligation to Close

	
27

	
9.3

	
Conditions to Seller’s Obligation to Close

 

	
28

	
ARTICLE X

	  
	
TERMINATION

	  
	
10.1

	
Termination

	
29

	
10.2

	
Effect of Termination

 

	
29

	
ARTICLE XI

	  
	
INDEMNIFICATION

	  
	
11.1

	
Obligations to Indemnify

	
30

	
11.2

	
Third Party Claims

	
30

	
11.3

	
Direct Claims

	
31

	
11.4

	
Materiality

	
32

	
11.5

	
Limits of Liability

	
32

	
11.6

	
Survival of Covenants, Representations and Warranties

	
33

	
11.7

	
Exclusive Remedy

	
33

	
11.8

	
Payments

	
33

	
11.9

	
Administration of Indemnity Claims

 

	
33

	
ARTICLE XII

	  
	
MISCELLANEOUS

	  
	
12.1

	
Notices

	
34

	
12.2

	
Entire Agreement; Amendment; Waiver; Exhibits and Schedules

	
35

	
12.3

	
Severability

	
35

	
12.4

	
Parties in Interest

	
35

	
12.5

	
Governing Law

	
35

	
12.6

	
Assignment

	
36

	
12.7

	
Dispute Resolution

	
36

	
12.8

	
Specific Performance

	
38

	
12.9

	
Counterparts

	
38

	
12.10

	
Expenses

	
38

	  	  	  

 

 

  

iii

  

 

	
Annex:

	  	  
	  	  	  
	
Annex A

	
-

	
Interpretation; Defined Terms

	  	  	  
	
Exhibits:

	  	  
	  	  	  
	
Exhibit A

	
-

	
Leased Real Property Assignments

	
Exhibit B

	
-

	
Bill of Sale

	
Exhibit C

	
-

	
Assumed Contracts Assignment

	
Exhibit D

	
-

	
Transition Services Agreement

	
Exhibit E

	
-

	
Closing Statement

	
Exhibit F

	
-

	
Purchase Price Receipt

	
Exhibit G

	
-

	
Custody Transfer Receipt

	
Exhibit H

	
-

	
Seller Guaranty

	
Exhibit I

	
-

	
FIRPTA Affidavit

	
Exhibit J

	
-

	
Notice

	
Exhibit K

	
-

	
Seller Certificate

	
Exhibit L

	
-

	
Buyer Certificate

	
Exhibit M

	
-

	
Buyer Guaranty

	
Exhibit N

	
-

	
ROW Assignment

  

iv

  

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) dated as of November 30, 2011 (the “Agreement Date”), is made and entered into by and between Western Refining Pipeline Company, a New Mexico corporation (“Seller”), and Plains Pipeline, L.P., a Texas limited partnership (“Buyer”).  Seller and the Buyer shall collectively be referred to herein as the “Parties” and each, a “Party.”

 

WHEREAS, Seller owns certain pipeline assets, which include an approximate 82 mile section of pipeline running from Section 1, T15S, R29E near Highway 249 in Chaves County, New Mexico, to Jal Station in Lea County, New Mexico (the “Pipeline”); and

 

WHEREAS, Seller desires to sell and assign to Buyer, and Buyer wishes to purchase and assume from Seller, all the assets related to the Pipeline and certain liabilities related thereto on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained herein, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties hereto hereby agree as follows:

 

ARTICLE I

SALE AND PURCHASE OF ASSETS, ASSUMPTION OF

LIABILITIES AND CONSIDERATION

 

1.1           Sale and Purchase of Assets.  At the Closing, subject to the terms and conditions hereof, Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall purchase from Seller, free and clear of any Liens (other than Permitted Liens), the Acquired Assets, and Buyer shall accept such Acquired Assets.  As used herein, “Acquired Assets” shall mean, collectively, the following (but shall specifically exclude the Excluded Assets):

 

(a)           Seller’s leasehold interests in the real property (as lessee or sublessee) leased or subleased by Seller as set forth on Schedule 1.1(a), together with Seller’s leasehold interest in and to all buildings, facilities, fixtures, structures and improvements situated thereon (collectively, the “Leased Real Property”) together with all amenities, rights and privileges appurtenant or related thereto, including associated tanking, piping and appurtenances at the Lynch Station and Jal Station used primarily and directly in the operation of the Pipeline;

 

(b)           the tangible machinery, equipment, office equipment, communications assets, computer hardware, furniture, furnishings, trailers, tools, oil manifold assets, and similar personal property owned by Seller and held by Seller for the operation of the Pipeline, including those items set forth on Schedule 1.1(b) but specifically excluding the Excluded Personal Property (collectively, the “Personal Property”);

 

(c)           all rights to Claims, refunds or adjustments with respect to the Acquired Assets or the Assumed Liabilities for the period on or after the Effective Time;

 

  

 

  

(d)           to the extent assignable, all rights of the Seller and its Affiliates (if applicable) under the Contracts in respect of the Business or the Assumed Liabilities as set forth on Schedule 1.1(d) (collectively, the “Assumed Contracts”);

 

(e)           original or true and complete copies (if no original is available) of all of the books and records of Seller (or its Affiliates) that relate exclusively to the Business or Assumed Liabilities (collectively, the “Books and Records”);

 

(f)           to the extent assignable, the Intellectual Property of Seller that is owned by Seller set forth on Schedule 1.1(f) (collectively, the “Assigned Intellectual Property”); and

 

(g)           all of Seller’s right, title and interest in and to rights-of-way to the extent used in the operations of the Pipeline or relating to the Pipeline, including easements, licenses and use agreements described on Schedule ‎1.1‎(g) (“ROW Rights”).

 

1.2           Excluded Assets.  Notwithstanding anything to the contrary contained in this Agreement, for the avoidance of doubt, Seller shall retain all of its right, title and interest in and to the following assets, properties and rights, and Seller shall not sell, assign, transfer, convey or deliver to Buyer hereunder any of the following assets, properties or rights (collectively, the “Excluded Assets”):

 

(a)           the tangible machinery, equipment, communications assets, computer hardware, tools, oil manifold assets, and similar personal property owned or leased by Seller and set forth on Schedule 1.2(a) (collectively, the “Excluded Personal Property”);

 

(b)           all books and records of Seller i) the disclosure of which could be inconsistent with any legal constraints or obligations regarding the confidentiality thereof (unless Buyer agrees to be bound by the confidentiality provisions related thereto) or constitute a waiver of any attorney-client, work product or similar privilege; (ii) relating to prior litigation, or litigation that is no longer applicable or pending; (iii) relating to the Excluded Assets or the Retained Liabilities; (iv) containing any information about Seller or any of its Affiliates that is unrelated to the Acquired Assets or the Assumed Liabilities; (v) containing any information about Seller or any of its Affiliates pertaining to project evaluation, price curves or projections or other economic or predictive models; (vi) relating to income Taxes paid by Seller or any of its Affiliates, except to the extent disclosed or required to be disclosed with respect to any Tax Return related in any manner to the Acquired Assets or the Assumed Liabilities; (vii) constituting organizational documents of Seller; (viii) constituting minutes, seals, equity interest records and other records of internal company proceedings of Seller; (ix) that Seller is required to retain by Law (in which event, copies thereof shall be delivered to Buyer); and (x) having been prepared in connection with, or relating in any way to the transactions contemplated by this Agreement or any bids or offers received from Buyer or any Third Parties and analyses relating in any way to the sale of the Acquired Assets (collectively, the “Excluded Books and Records”);

 

(c)           all rights to Claims, refunds or adjustments with respect to the Acquired Assets which relate to any period prior to the Effective Time and with respect to the Excluded Assets, all other refunds or adjustments relating to any Action with respect to the Excluded 

 

  

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Assets, and with respect to the Acquired Assets those that relate to any period prior to the Effective Time and all rights to insurance proceeds or other insurance recoveries that ii) relate to, or are reimbursement for, Seller’s or any Affiliate’s of Seller expenditures made prior to the Effective Time for which insurance proceeds are available or due to Seller or such Affiliate with respect to the Acquired Assets or iii) relate to Excluded Assets or Retained Liabilities;

 

(d)           all of Seller’s cash and cash equivalents on hand and in bank accounts;

 

(e)           all of Seller’s accounts receivable and audit rights relating thereto arising under any of the applicable Contracts or otherwise with respect to any of the Excluded Assets and, with respect to the Acquired Assets, for any period prior to the Effective Time;

 

(f)           all of Seller’s net operating losses and Tax refunds relating to the Excluded Assets, and with respect to the Acquired Assets, for any period prior to the Effective Time;

 

(g)           all of Seller’s rights, title and interest in and to all posted surety or performance bonds relating to the Acquired Assets, including those set forth on Schedule 1.2(g) (the “Credit Support Instruments”);

 

(h)           all of Seller’s rights under the Contracts that are described and set forth on Schedule ‎1.2(h) (collectively, the “Excluded Contracts”);

 

(i)           Seller’s Intellectual Property set forth on Schedule 1.2(i) (collectively, the “Excluded Intellectual Property”);

 

(j)           all Permits related to Seller’s ownership or operation of the Pipeline (the “Existing Permits”); and

 

(k)           with respect to any right of way which covers a portion of the Pipeline and a portion of the pipeline assets of the Seller other than the Pipeline, that portion of such right of way to the extent covering Seller’s assets other than the Pipeline.

 

1.3           Assumption of Liabilities.

 

(a)           Assumed Liabilities.  Buyer shall assume and thereafter perform, pay, honor, and discharge when due and payable only the following liabilities, obligations, commitments, penalties, damages, debts, charges, fees, expenses, and disbursements (the “Assumed Liabilities”):

 

(i)           all liabilities and obligations of Seller incurred or accruing under the Assumed Contracts with respect to periods commencing on and after the Effective Time;

 

(ii)           all liabilities and obligations accruing, arising out of and related to the ownership, possession, use or operation of the Acquired Assets on and after the Effective Time, including liabilities and obligations for personal injury or death or damage to property of any Third Party attributable to or arising out of the ownership or operation of the Acquired Assets on and after the Effective Time;

 

  

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(iii)           all liabilities and obligations relating to the ownership or operation of the Leased Real Property and ROW Rights, including, without limitation, obligations to bring such Leased Real Property and ROW Rights into compliance with applicable Environmental Law regardless of whether such liabilities or obligations or conditions or events giving rise to such liabilities or obligations, arose, occurred or accrued before or after the Effective Time; and

 

(iv)           all liabilities and obligations arising out of or related in any way to the Pipeline Reactivation.

 

(b)           Retained Liabilities.  From and after the Effective Time, Seller shall remain solely liable for and shall pay, perform and discharge when due all of the following liabilities, obligations and commitments of Seller (the “Retained Liabilities”):

 

(i)           all liabilities and obligations of Seller, Seller’s Affiliates, or Seller’s Representatives, incurred or accruing under the Assumed Contracts with respect to the period prior to the Effective Time;

 

(ii)           all liabilities (including liabilities and losses resulting from shortages in the amounts of Linefill which were delivered by Seller into Buyer’s custody but excluding liabilities or losses resulting from actions taken or not taken by Buyer after Closing) and obligations arising out of or relating to or associated with the Excluded Assets;

 

(iii)           all fines or penalties prescribed by a Governmental Entity for a violation by Seller of its Affiliates of any applicable Laws (including Environmental Laws) by or with respect to the Acquired Assets which violation occurred prior to the Effective Time;

 

(iv)           all liabilities and obligations to the extent accruing or resulting from or arising out of Seller’s (or Seller’s Affiliates’) offsite disposal of Hazardous Materials resulting from Seller’s ownership, possession, use or operation of the Acquired Assets prior to the Effective Time;

 

(v)           all liabilities and obligations (including any liabilities arising under ERISA) directly arising out of the employment by Seller (or its Affiliates) of its employees substantially involved in the operation of the Acquired Assets prior to the Effective Time or the Excluded Assets; and

 

(vi)           all losses, claims, liabilities, demands, penalties, interest, costs and expenses arising out of, accruing, incident, relating to, or in connection with Seller or Seller’s Affiliates’ failure to pay Taxes attributable or allocable to the Acquired Assets (excluding any sales or transfer Taxes to the extent arising from the sale and purchase of the Acquired Assets) attributable to or accruing during periods prior to the Effective Time.

 

Notwithstanding any provision in this Agreement to the contrary, the Retained Liabilities shall include all liabilities accruing or arising in any manner whatsoever as a result of, relating to or in connection with any criminal act occurring or accruing prior to the Effective Time by Seller or Seller’s Affiliates.

 

  

4

  

1.4           Consideration.  The aggregate consideration for the sale and transfer of the Acquired Assets shall be an amount in cash equal to $40,000,000.00 (the “Purchase Price”). The Purchase Price shall be allocated as provided in Section 7.10(e).  The Purchase Price shall be paid by Buyer at Closing by wire transfer of immediately available funds to an account specified in writing by Seller (which such account shall be specified in writing to Buyer no later than three (3) Business Days prior to the Closing Date).

 

1.5           Pipeline Reactivation Adjustment.

 

(a)           The Parties acknowledge that the Purchase Price has been based in part upon Buyer’s anticipated post-Closing reactivation of the Deactivated Section of the Pipeline.  Subject to Seller’s reimbursement obligations pursuant to Section 1.5(b), Buyer shall be responsible for all costs related to the reactivation of the Deactivated Section of the Pipeline (the “Pipeline Reactivation”) and shall use commercially reasonable efforts to limit the actual out-of-pocket expenses incurred in connection therewith (the “Pipeline Reactivation Costs”).

 

(b)           Should the Pipeline Reactivation Costs relating directly to the reactivation of the Deactivated Section but excluding enhancements or improvements to the Deactivated Section desired to be made by Buyer, including the installation of block valves, pipeline connections and infrastructure to separate the Deactivated Section from other assets of Seller or connect the Deactivated Section with other assets of Buyer (the “Reimbursable Costs”) exceed $500,000.00, then upon:

 

(i)    the full and final completion of the work associated with the Reimbursable Costs;

 

(ii)   Buyer’s final and unconditional payment in full of the Reimbursable Costs to the appropriate Third Party; and

 

(iii)  Seller’s receipt from Buyer of all documentation reasonably requested by Seller to substantiate Buyer’s final and unconditional payment in full of the Reimbursable Costs,

 

Seller shall reimburse Buyer for that portion of Buyer’s reasonably incurred Reimbursable Costs that exceed $500,000.00; provided that, except as may be mutually agreed upon by the Parties pursuant to Section 1.5(c), Seller’s reimbursement obligations for Reimbursable Costs shall not exceed $500,000.00 (the “Reimbursable Costs Cap”).

 

(c)           Should Buyer’s Reimbursable Costs exceed $1,000,000.00, Seller and Buyer shall engage in good faith negotiations to determine how such excess Reimbursable Costs should be allocated between Buyer and Seller.

 

1.6           Adjustments to Purchase Price.  All amounts paid pursuant to Section 1.5 shall be deemed to be adjustments to the Purchase Price, except as otherwise required by applicable Laws.

 

1.7           Non-Assignment of Certain Acquired Assets.  Notwithstanding anything contained in this Agreement to the contrary, this Agreement shall not constitute an agreement to 

 

  

5

  

 

assign or sell any Acquired Asset if an attempted assignment thereof without Consent would violate any right of any Third Party or any Law or Permit, and no breach of this Agreement shall have occurred by virtue of such non-assignment.  Notwithstanding the foregoing, if any necessary Consent is not obtained prior to the Closing Date, Seller shall: (i) take all commercially reasonable efforts subsequent to the Closing to obtain such Consent as quickly as possible and (ii) to the extent not prohibited by the terms of any applicable Contract or any Law or Permit and until the receipt of such Consent, hold at Buyer’s sole cost and expense the Acquired Asset subject to obtaining such Consent, together with any proceeds therefrom, in trust for Buyer and during the pendency of such trust Buyer shall reimburse Seller for any costs or expenses incurred by Seller for doing so, including any costs to operate or maintain such asset.  Seller and Buyer shall cooperate (each at its own expense) in any lawful and reasonable arrangement reasonably proposed by Buyer under which Buyer shall obtain to the extent practicable the economic claims, rights and benefits under the Acquired Asset, Claim or right with respect to which the Third Party Consent or authorization has not been obtained in accordance with this Agreement.  Such reasonable arrangement shall be subject to Buyer’s prior written approval, not to be unreasonably withheld, and may include (x) the subcontracting, sublicensing or subleasing to Buyer at no cost to Seller of any and all rights of Seller against the other party to such Third Party agreement arising out of a breach or cancellation thereof by the other party and (y) commercially reasonable efforts by Seller to enforce such rights.  If Buyer is able to receive the economic claims, rights and benefits under such asset, such economic claims, rights and benefits shall constitute an Acquired Asset.  The provisions of this Section 1.7 shall survive Closing.

 

ARTICLE II

CLOSING

 

2.1           Closing.  The closing of the transactions contemplated hereby (the “Closing”) shall be held at the offices of Vinson & Elkins LLP, 1001 Fannin Street, Suite 2500, Houston, Texas  77002 at 10:00 a.m. on the second to last Business Day of the month in which the satisfaction or waiver of the conditions set forth in Article IX and elsewhere in this Agreement (other than those conditions relating to execution of the Ancillary Agreements, which will be satisfied at the Closing) occurs, or such other place, time or date as may be agreed upon by the Parties.  The date on which the Closing takes place is referred to herein as the “Closing Date.”  The Closing shall be deemed to be effective as of 12:01 a.m. on the Closing Date (the “Effective Time”).

 

2.2           Deliveries by Seller.  At the Closing, Seller shall deliver, or cause to be delivered, to Buyer the following:

 

(a)           a duly executed counterpart to the assignment and assumption of Assumed Contracts consisting of leases and subleases of the Leased Real Property substantially in the form attached hereto as Exhibit A (the “Leased Real Property Assignments”);

 

(b)           a duly executed counterpart to the bill of sale, assignment and assumption agreement covering all Acquired Assets (other than the Leased Real Property) substantially in the form attached hereto as Exhibit B (the “Bill of Sale”);

 

  

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(c)           a duly executed and acknowledged counterpart to the assignment and assumption of Assumed Contracts (excluding leases and subleases) substantially in the form attached hereto as Exhibit C (the “Assumed Contracts Assignment”)

 

(d)           a duly executed counterpart to the Transition Services Agreement substantially in the form of Exhibit D (the “Transition Services Agreement”);

 

(e)           a duly executed Closing Statement, showing the flow of funds, substantially in the form of Exhibit E (the “Closing Statement”);

 

(f)           a duly executed Purchase Price Receipt, confirming the Seller’s receipt of funds at Closing, substantially in the form of Exhibit F;

 

(g)           a duly executed custody transfer receipt, transferring custody, but not title of all Linefill, substantially in the form of Exhibit G (the “Custody Transfer Receipt”);

 

(h)           a parent guaranty of Western Refining, Inc., guarantying Seller’s obligations under this Agreement, substantially in the form of Exhibit H (the “Seller Guaranty”);

 

(i)           a duly executed and acknowledge non-foreign ownership (FIRPTA) Affidavit substantially in the form of Exhibit I;

 

(j)           organizational and authorizing documents of Seller as shall be reasonably required by Buyer to evidence Seller’s authority to enter into and consummate the transactions contemplated by this Agreement and the Ancillary Agreements;

 

(k)           the originals (or copies if originals are not available) of all of the Assumed Contracts and the Books and Records;

 

(l)           all documentation, in a form that is reasonably acceptable to Buyer, reasonably necessary to reflect a release of all of the liens against the Acquired Assets listed on Schedule 2.2(l);

 

(m)           duly executed notices to Third Parties under the Assumed Contracts and assumed leases in the form of Exhibit J, advising such Third Parties of Buyer’s assumption of Seller’s obligations thereunder accruing on and after the Effective Time;

 

(n)           a duly executed certificate of Seller, dated as of the Closing Date, certifying that the conditions set forth in Sections ‎9.2(a)(i) and ‎9.2(a)(ii) have been fulfilled, substantially in the form of Exhibit K;

 

(o)           a duly executed counterpart to the Right of Way Assignment substantially in the form of Exhibit N (the “ROW Assignment”); provided that such ROW Rights shall be conveyed without any warranty of title; and

 

(p)           any other documents, instruments or agreements contemplated hereby or reasonably necessary or appropriate to consummate the transactions contemplated by this Agreement, and in a form reasonably acceptable to Buyer and Seller (it being understood that 

 

  

7

  

 

such instruments shall not require Seller or any other Person to make any additional representations, warranties or covenants, express or implied, not contained in or as contemplated by this Agreement or the Ancillary Agreements).

 

2.3           Deliveries by Buyer.  At the Closing, the Buyer shall deliver, or cause to be delivered, to Seller the following:

 

(a)           the Purchase Price;

 

(b)           a duly executed counterpart to the Leased Real Property Assignments;

 

(c)           a duly executed counterpart to the Bill of Sale;

 

(d)           a duly executed counterpart to the Assumed Contract Assignment;

 

(e)           a duly executed counterpart to the Transition Services Agreement;

 

(f)           a duly executed counterpart to the Custody Transfer Receipt;

 

(g)           a duly executed counterpart to the Closing Statement;

 

(h)           a duly executed counterpart to the ROW Assignment;

 

(i)           a duly executed certificate of Buyer, dated as of the Closing Date, certifying that the conditions set forth in Sections ‎9.3(a) and ‎9.3(b) have been fulfilled, substantially in the form of Exhibit L;

 

(j)           a parent guaranty of Plains All American Pipeline, L.P., guarantying Buyer’s obligations under this Agreement, substantially in the form of Exhibit M (the “Buyer Guaranty”); and

 

(k)           any other documents, instruments or agreements contemplated hereby or reasonably necessary or appropriate to consummate the transactions contemplated by this Agreement, and in a form reasonably acceptable to Buyer and Seller (it being understood that such instruments shall not require Buyer, Seller or any other Person to make any additional representations, warranties or covenants, express or implied, not contained in or as contemplated by this Agreement or the Ancillary Agreements).

 

2.4           Prorations.

 

(a)           On the Closing Date, or as promptly as practicable following the Closing Date, but in no event later than one hundred and twenty (120) calendar days thereafter, the water, gas, electricity and other utilities, local business or other license fees to the extent assigned and other similar periodic charges payable with respect to the Acquired Assets shall be prorated between Seller, on the one hand, and Buyer, on the other hand, effective as of the Effective Time with Seller being responsible for amounts related to the period prior to but excluding the Closing Date and Buyer being responsible for amounts related to the period on and after the Closing Date.  The Parties shall use commercially reasonable efforts to cause utility meter readings to be 

 

  

8

  

 

determined as of the Effective Time or as close thereto as reasonably practicable; provided, however, that if a Party’s proration for a particular amount owed under this Section 2.4 cannot be determined due to the unavailability of the necessary information on the appropriate invoice or remittance statement, then the proration shall be calculated on a per day basis using the number of days in the respective Party’s period.

 

(b)           All income, proceeds and receipts attributable to the operation, use, ownership, or otherwise of the Acquired Assets prior to the Effective Time shall be the property of Seller and to the extent received by Buyer or its Affiliates, Buyer shall promptly and fully disclose, account for and transmit same to Seller.  All income, proceeds and receipts attributable to the operation, use, ownership, or otherwise of the Acquired Assets on and after the Effective Time shall be the property of Buyer and to the extent received by Seller or its Affiliates, Seller shall promptly and fully disclose, account for and transmit same to Buyer.  In addition, all invoices, costs, expenses, disbursements and payables attributable to the Acquired Assets prior to the Effective Time shall be the sole obligation of Seller, and Seller shall promptly pay, or if paid by Buyer, Seller shall promptly reimburse Buyer for same.  All invoices, costs, expenses, disbursements and payables attributable to the Acquired Assets on and after the Effective Time shall be the sole obligation of Buyer, and Buyer shall promptly pay, and to the extent paid by Seller, Buyer shall promptly reimburse Seller for same.

 

(c)           The provisions of this Section 2.4 shall survive the Closing.

 

2.5           Closing Costs; Transfer Taxes and Fees.

 

(a)           Allocation of Costs.  Buyer shall pay all sales, transfer and use Taxes arising out of the transactions contemplated by this Agreement (including the grantors tax for recording real estate conveyance documents) and all costs and expenses (including recording fees and real estate transfer Taxes) incurred in connection with Buyer obtaining or recording title to the Acquired Assets.  The sales, use and transfer Tax Returns required by reason of the transactions contemplated by this Agreement shall be timely prepared and filed by the Party obligated by Law to make such filing.  The Parties agree to cooperate with each other (at their own expense) in connection with the preparation and filing of such returns, in obtaining all available exemptions from such sales, use and transfer Taxes, and in timely providing each other with resale certificates and any other documents necessary to satisfy any such exemptions.

 

(b)           Reimbursement.  If a Party pays any Tax agreed to be borne by another Party under this Agreement, such other Party shall promptly (and in any event within five (5) Business Days after receipt of written notice thereof) reimburse the paying Party for the amounts so paid.  If any Party receives any Tax refund or credit applicable to a Tax paid by another Party, the receiving Party shall promptly (and in any event within five (5) Business Days) pay such amounts to the Party entitled thereto.  The provisions of this Section 2.5(b) shall survive the Closing.

 

(c)           Occasional Sale Tax Certificate.  Seller shall cooperate with Buyer and use reasonable efforts to deliver to Buyer a certificate, in form materially satisfactory to Buyer and Seller, to support the availability of an occasional sale exemption for the Transaction under New Mexico Law.

 

  

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER

 

Except as set forth on the disclosure schedule delivered by Seller to Buyer in connection with this Agreement (the “Disclosure Schedule”), Seller hereby represents and warrants to the Buyer as follows as of the Agreement Date:

 

3.1           Organization.  Seller is a corporation duly organized, validly existing and in good standing under the Laws of the State of New Mexico and has the requisite power to own, lease and operate its properties and assets and to carry on its business as now being conducted.  Seller is duly qualified to do business and in good standing as a foreign corporation in each of the states in which it has assets or conducts activities which require it to be so qualified or in good standing, except where the failure to be so qualified or in good standing would not reasonably be expected to have a Material Adverse Effect.

 

3.2           Authorization.  Seller has full corporate power and authority to execute and deliver this Agreement and the Ancillary Agreements and consummate the transactions contemplated hereby and thereby.  Seller has taken all corporate action required to authorize the execution, delivery and performance of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby.  This Agreement has been duly executed and delivered by Seller and, assuming due authorization, execution and delivery by Buyer, constitutes a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, except as enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar Laws now or hereafter in effect relating to creditors’ rights generally and general principles of equity, regardless of whether enforceability is considered in a proceeding at law or in equity (collectively, the “Creditor’s Rights Exception”).  The Ancillary Agreements shall, on the Closing Date, be duly and validly executed by Seller and, assuming due authorization, execution and delivery by the other parties thereto, constitute legal, valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms, except for the Creditor’s Rights Exception.

 

3.3           No Conflicts; Consents.  Except as set forth on Schedule 3.3 and subject to obtaining the Required Third Party Consents, the execution, delivery and performance by Seller of this Agreement and the Ancillary Agreements do not, and the consummation of the transactions contemplated hereby and thereby will not, b) violate, conflict with, or result in any breach of any provision of the Governing Documents of Seller, c) to the Knowledge of Seller, violate, conflict with or result in a violation or breach of, or constitute a default under, any of the material terms, conditions or provisions of any material Contract, or other instrument or agreement to which Seller is a party or by which Seller or any material portion of its assets (including the Acquired Assets) is bound, or d) to the Knowledge of Seller, violate in any material respect any applicable Law binding upon Seller or any material portion of its assets (including the Acquired Assets), except in the case of subsections (a), (b) and (c) such matters as would not be reasonably expected to have a Material Adverse Effect.  To the Knowledge of Seller, no Consent of any Governmental Entity or any other Person is required to be obtained by Seller in connection with the execution, delivery and performance of this Agreement and the Ancillary Agreements to which Seller is a party or the consummation of the transactions 

 

  

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contemplated hereby or thereby, except for (1) requirements under the HSR Act, (2) the Consents set forth in Schedule ‎3.3 (the “Required Third Party Consents”), (iii) Consents which the failure to obtain would not reasonably be expected to have a Material Adverse Effect, and (iv) Post-Closing Consents.

 

3.4           Compliance With Laws and Permits.  To the Knowledge of Seller, except as set forth on Schedule 3.4, Seller owns and operates the Acquired Assets in material compliance with all applicable Laws.  Except as set forth on Schedule 3.4, no investigation or review by any Governmental Entity with respect to Seller or any of its Affiliates and relating to the Acquired Assets is pending or, to the Knowledge of Seller, threatened which, if resolved adversely to Seller or any of its Affiliates, would have a Material Adverse Effect.  Notwithstanding the foregoing, the Seller makes no representation or warranty, express or implied, under this Section 3.4 relating to any (3) Tax matters, which are exclusively addressed in Section 3.9 or (4) environmental matters, which are exclusively addressed in Section 3.11.

 

3.5           Absence of Litigation.  Except as set forth on Schedule ‎3.5, there is no Action pending or, to the Knowledge of Seller, threatened, against Seller or any of its Affiliates relating to the Acquired Assets or challenging the transactions contemplated hereby.

 

3.6           Absence of Changes.  Since June 30, 2011, e) Seller and its Affiliates have operated and maintained or idled the Acquired Assets in the ordinary course of business consistent with past practice and f) there has not, to the Knowledge of Seller, occurred a Material Adverse Effect.

 

3.7           Title to Acquired Assets.

 

(a)           Except as set forth on Schedule ‎3.7(a), at the Closing (and as of the Effective Time), Seller will have and will convey to Buyer i) good and valid title to the Personal Property and ii) valid leasehold interests in all of the Leased Real Property, in each case of the foregoing clauses (i) through (ii), inclusive, free and clear of any Liens, other than Permitted Liens.

 

(b)           Except as set forth on Schedule ‎3.7(b), neither Seller nor its Affiliates have received any written notice from any Governmental Entity, and to the Knowledge of Seller, neither Seller nor its Affiliates have received any notice (either verbal or written) from any Governmental Entity of any pending or threatened condemnation, eminent domain or similar proceeding or special assessment affecting the Leased Real Property or any portion thereof.

 

(c)           Except as set forth on Schedule 3.7(c), iii) Seller is not a party to any Contract regarding the sale, conveyance, transfer, lease or disposition of any portion of the Acquired Assets (except for this Agreement or as contemplated hereby); iv) there has not been granted to any Person and no Person possesses, any option to purchase or right of first refusal to purchase any portion of the Acquired Assets; and v) Seller is not a party to any sublease or similar arrangement with respect to the Leased Real Property or any portion thereof.

 

(d)           Except as set forth on Schedule ‎3.7(d), neither Seller nor its Affiliates have received any written notice that Seller is in default under any lease or other Assumed Contract in respect of the Acquired Assets, or any portion thereof, which matter remains 

 

  

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unresolved as of the date hereof except for that which would not reasonably be expected to have a Material Adverse Effect.

 

3.8           Contracts.  True, correct and complete copies of all Assumed Contracts have been delivered to Buyer.  Except as disclosed in Schedule 3.8, to the Knowledge of Seller, (a) each Assumed Contract is in full force and effect and constitutes a valid and binding agreement, enforceable in accordance with its terms, except for the Creditor’s Rights Exception, (b) Seller has fulfilled and performed all of Seller’s material obligations and requirements under the Assumed Contracts, (c) neither Seller nor any of its Affiliates is in breach of or default, in any material respect, under any Assumed Contract, and (d) provided all Required Third Party Consents are obtained prior to Closing, no event or action has occurred, is pending, or to the Knowledge of Seller, is threatened, which after the giving of notice, or the lapse of time, or both, would reasonably be expected to result in the termination, breach or default of any Assumed Contract.  Except as disclosed in Schedule 3.8, to the Knowledge of Seller, (a) no other party to any Assumed Contract is in breach of or default under such Assumed Contract in any material respect, and (b) neither Seller nor any of its Affiliates has received any written notice from any other party to any Assumed Contract that alleges any violation, breach or default by Seller or any Affiliate of Seller of any Assumed Contract in any material respect.

 

3.9           Taxes.  Except as set forth in Schedule ‎3.9, with respect to Taxes the non-payment of which could result in a Lien on the Acquired Assets or for which Buyer could be held liable, g) all Tax Returns required to be filed with respect to such Taxes have been duly and timely filed and all such Tax Returns are correct and complete in all material respects; h) all such Taxes that have become due have been paid in full by Seller; i) there is no Claim or Action against Seller (or its Affiliates) for any such Taxes, and no assessment, deficiency, or adjustment has been asserted, proposed, or threatened with respect to any such Taxes; and j) there is not in force any extension of time of the statute of limitations with respect to the collection of any such Taxes.  None of the Acquired Assets are held in any arrangement that is classified as a partnership for federal income tax purposes.  There are no Liens for Taxes encumbering any of the Acquired Assets other than Permitted Liens.

 

3.10           Employees.  There are no employees associated with the Acquired Assets who will be transferred to Buyer (or its Affiliates) under this Agreement.  

 

3.11           Environmental Matters.

 

(a)           Actions.  Except as set forth on Schedule ‎3.11(a), there are no Claims or Actions pending or, to the Knowledge of Seller, threatened against the Acquired Assets, Seller, or any of its Affiliates, relating to the Acquired Assets that allege i) Seller or any its Affiliates are presently required to perform any remedial obligations under any applicable Environmental Law or Environmental Permit, ii) violations by Seller or any of its Affiliates of any Environmental Law or Environmental Permit, or iii) personal injury or property damage claims relating to a Release of Hazardous Materials by Seller or any its Affiliates.

 

(b)           Compliance.  Except as set forth on Schedule 3.11(b), to the Knowledge of Seller:

 

  

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(i)           Seller’s current operation of the Acquired Assets is in compliance, in all material respects, with all applicable Environmental Laws and Environmental Permits, except for violations that are or can be remedied by routine repair and maintenance in the ordinary course of business.

 

(ii)           To the Knowledge of Seller, neither Seller, nor its Affiliates have received any written notice of noncompliance with or violation of any Environmental Law or Environmental Permit or entered into any consent decree or order, or is subject to any order of any court or Governmental Entity relating to Environmental Laws.

 

(iii)           Set forth in Schedule ‎3.11(b)(iii) is a true, correct and complete list of all Environmental Permits held by Seller or its Affiliates in connection with the ownership, occupancy and the current operation of the Acquired Assets.  All such Environmental Permits have been duly obtained or filed and are in full force and effect, and the applicable holder of each Environmental Permit is in compliance, in all material respects, with such Environmental Permits.  To the Knowledge of Seller, Seller has all Environmental Permits required under Environmental Law reasonably necessary to own, lease or operate the Acquired Assets as currently operated by Seller, and there exists no material violation thereof, material default thereunder or material breach thereof, and to the Knowledge of Seller, no event has occurred or condition or state of facts exists which, after notice or lapse of time, or both, would constitute a material breach or material default under such Environmental Permits.  To the Knowledge of Seller, no Governmental Entity has given, any notice to terminate or cancel any such Environmental Permit held by Seller or its Affiliates in connection with Seller’s ownership, occupancy or current operation of the Acquired Assets.  To the Knowledge of Seller, Seller has timely submitted in accordance with prior customary practices of the Seller and in accordance with applicable Law any and all applications necessary for such Environmental Permits to remain in full force and effect.

 

(iv)           To the Knowledge of Seller, none of the Acquired Assets is encumbered by a Lien (other than a Permitted Lien) arising or imposed under Environmental Laws or Environmental Permits.

 

(v)           To the Knowledge of Seller, except for de minimis quantities associated with routine operation of the Acquired Assets, there has been no release by Seller or its Affiliates of Hazardous Materials on the Leased Real Property in violation of Environmental Laws or Environmental Permits or in amounts that would reasonably be expected to give rise to an obligation to perform remediation or other corrective action pursuant to Environmental Laws.

 

(vi)           Seller has furnished to Buyer all material environmental audits, internal reports, inspection reports of Governmental Entities and other material environmental documents relating to the Acquired Assets that are in Seller’s possession, custody or control.

 

(vii)           None of the Acquired Assets is listed on the National Priorities List or any equivalent “Superfund” list under the statutes of the State of New Mexico requiring remedial action.

 

  

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(viii)           Seller is in compliance in all material respects with all Orders issued by a Governmental Entity pursuant to Environmental Laws in respect of the Pipeline.

 

3.12           No Brokers or Finders.  There is no investment banker, broker, finder, financial advisor or other intermediary who has been retained by or is authorized to act on behalf of Seller or any of its Affiliates who is entitled to receive from Seller any fee or commission in connection with the transactions contemplated by this Agreement or any part thereof or any interest therein.

 

3.13           Sufficiency of Assets.  The Acquired Assets include substantially all of the assets, properties, rights (including Intellectual Property rights (if any)), titles and interests of Seller (other than the Excluded Assets) used by Seller in the operation of the Pipeline and necessary for the operation of the Pipeline as operated by Seller at Closing.  To the Knowledge of Seller, the Acquired Assets include all of the assets, properties, rights and interests necessary for Seller to conduct the Business.

 

3.14           Intellectual Property.  Except as set forth on Schedule 3.14, there are no licenses or other rights to use (including, foreign rights) or any copyrights, patents, patent applications, trade names, trade secrets, registered and unregistered trademarks, servicemarks, franchises, domain names or other similar rights now used or employed by Seller with respect to the Acquired Assets.  To Seller’s Knowledge, no Third Party is infringing on or otherwise violating any right of Seller with respect to the Assigned Intellectual Property and Seller’s (or Seller’s Affiliates’) use of the Assigned Intellectual Property is not infringing on any Third Party’s Intellectual Property.

 

3.15           WAIVERS AND DISCLAIMERS.  BUYER ACKNOWLEDGES THAT IT HAS HAD AN OPPORTUNITY TO INSPECT THE ACQUIRED ASSETS, THAT IT HAS CONDUCTED ITS INDEPENDENT DUE DILIGENCE INVESTIGATION AND INSPECTION OF ALL ASPECTS OF SUCH ACQUIRED ASSETS AND THE CLOSING OF THE TRANSACTIONS CONTEMPLATED HEREBY IS NOT CONDITIONED ON IT CONDUCTING FURTHER DUE DILIGENCE.  OTHER THAN AS EXPRESSLY SET OUT HEREIN OR IN THE ANCILLARY AGREEMENTS, BUYER IS RELYING ON SUCH INDEPENDENT INVESTIGATION AND INSPECTION OF THE ACQUIRED ASSETS AND IS NOT RELYING ON ANY INFORMATION PROVIDED BY SELLER OR ITS REPRESENTATIVES IN DETERMINING WHETHER TO ACQUIRE THE ACQUIRED ASSETS.

 

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES MADE BY SELLER SET FORTH IN THIS ARTICLE III AND EXCEPT FOR THE OTHER COVENANTS AND AGREEMENTS MADE BY SELLER IN THIS AGREEMENT OR IN THE ANCILLARY AGREEMENTS, BUYER ACKNOWLEDGES AND AGREES THAT THE SALE AND BUYER’S ACQUISITION OF THE ACQUIRED ASSETS AS PROVIDED FOR HEREIN SHALL BE MADE IN AN “AS IS”, “WHERE IS” CONDITION WITH ALL FAULTS AND THAT SELLER HAS NOT MADE, NOR DOES IT MAKE, AND SELLER SPECIFICALLY NEGATES AND DISCLAIMS, ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER 

 

  

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EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST OR PRESENT, REGARDING (A) THE VALUE, NATURE, QUALITY OR CONDITION OF THE ACQUIRED ASSETS, INCLUDING WITHOUT LIMITATION, THE WATER, SOIL, GEOLOGY OR ENVIRONMENTAL CONDITION OF THE PROPERTIES INCLUDED IN THE ACQUIRED ASSETS, GENERALLY, INCLUDING THE PRESENCE OR LACK OF HAZARDOUS SUBSTANCES OR MATTERS ON SUCH PROPERTIES, (B) THE INCOME TO BE DERIVED FROM THE ACQUIRED ASSETS, (C) THE SUITABILITY OF THE ACQUIRED ASSETS FOR ANY AND ALL ACTIVITIES AND USES WHICH BUYER OR ANY OTHER PARTY MAY CONDUCT THEREON, (D) THE COMPLIANCE OF OR BY ANY SUCH ACQUIRED ASSET OR ITS OPERATION WITH ANY LAWS OF ANY GOVERNMENTAL ENTITY (INCLUDING ANY ZONING, ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES, REGULATIONS, ORDERS, OR REQUIREMENTS), OR (E) THE HABITABILITY, MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY OF THE ACQUIRED ASSETS.  THIS PARAGRAPH SHALL SURVIVE THE CLOSING.  BUYER ACKNOWLEDGES THAT THE WAIVERS AND DISCLAIMERS IN THIS SECTION ARE CONSPICUOUS.

 

3.16           Survival.  The representations and warranties of Seller in this Agreement and in the Ancillary Agreements shall survive the Closing or the earlier termination of this Agreement in accordance with the survival provisions set forth in Section 11.6.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE BUYER

 

Buyer hereby represents and warrants to Seller as follows as of the Agreement Date:

 

4.1           Organization.  Buyer is a limited partnership, duly organized, validly existing and in good standing under the Laws of its state of organization and has the requisite limited partnership power to own, lease and operate its properties and to carry on its business as now being conducted. Buyer is duly qualified to do business and in good standing as a foreign limited partnership in all jurisdictions in which the character of the properties now owned or leased by it or the nature of the business conducted by it requires it to be so licensed or qualified, except where the failure to be so licensed or qualified would not materially impair Buyer’s ability to consummate the transactions contemplated by this Agreement.

 

4.2           Authorization.  Buyer has full limited partnership power and authority to k) execute and deliver this Agreement and the Ancillary Agreements contemplated hereby to be executed and delivered by Buyer and l) consummate the transactions contemplated hereby and thereby.  Buyer has taken all limited partnership action required to authorize: 1. the execution and delivery of this Agreement and the Ancillary Agreements to be executed and delivered by Buyer and 2. the consummation of the transactions contemplated hereby and thereby.  This Agreement has been duly and validly executed and delivered by Buyer and, assuming due authorization, execution and delivery by Seller, is a legal, valid and binding obligation of the Buyer, enforceable against it in accordance with its terms, except for the Creditor’s Rights Exception.  The Ancillary Agreements shall, on the Closing Date, be duly and validly executed by Buyer and, assuming due authorization, execution and delivery by the other parties thereto, 

 

  

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constitute legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms, except for the Creditor’s Rights Exception.

 

4.3           No Violations; Consents.  Except as set forth on Schedule 4.3, the execution, delivery and performance by Buyer of this Agreement and the Ancillary Agreements do not, and consummation of the transactions contemplated hereby and thereby will not, m) violate, conflict with, or result in any breach of any provisions of the Governing Documents of Buyer; n) to the Knowledge of Buyer, violate, conflict with or result in a violation or breach of, or constitute a default under, any of the material terms, conditions or provisions of any material Contract, or other instrument or obligation, to which Buyer is a party or by which Buyer or any material portion of its assets is bound; or o) subject to obtaining the Consents or making the registrations, declarations or filings set forth in the next sentence, to the Knowledge of Buyer materially violate any applicable Law binding upon Buyer or by which it or any material portion of its assets are bound, except in the case of subsections (a), (b) and (c) such matters as would not be reasonably expected to have a Material Adverse Effect.  To the Knowledge of Buyer, no Consent of any Governmental Entity or any other Person is required to be obtained by Buyer in connection with the execution, delivery and performance of this Agreement and the other Ancillary Documents to which Buyer is a party or the consummation of the transactions contemplated hereby and thereby, except for (1) under the HSR Act, (ii) the Required Third Party Consents, (iii) Consents the which the failure to obtain would not reasonably be expected to have a Material Adverse Effect and (iv) Post-Closing Consents.

 

4.4           Absence of Litigation.  Except as set forth on Schedule 4.4, there is no Action pending or, to the Knowledge of Buyer, threatened against Buyer or any of its Affiliates relating to the Acquired Assets or the transactions contemplated by this hereby.

 

4.5           No Brokers and Finders.  There is no investment banker, broker, finder, financial advisor or other intermediary who has been retained by or is authorized to act on behalf of the Buyer who is entitled to receive from Buyer any fee or commission in connection with the transactions contemplated by this Agreement or any part thereof or any interest therein.

 

4.6           Due Diligence.  Buyer is an informed and sophisticated buyer experienced in financial and business matters and the evaluation and investment in businesses such as Seller’s and the transactions as contemplated hereunder.  Buyer has undertaken such investigation as it has deemed necessary to enable it to make an informed decision with respect to the execution, delivery and performance of this Agreement.  Seller has provided Buyer with an opportunity to ask questions of the officers and management of Seller and its Affiliates.

 

4.7           Sufficient Funds.  Buyer has sufficient cash or cash equivalents available to pay the aggregate Purchase Price on the terms and conditions contained in this Agreement, and there is no restriction on the use of such cash or cash equivalents for such purpose.

 

  

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ARTICLE V

COVENANTS AND AGREEMENTS OF SELLER

 

5.1           Pre-Closing Access and Information.

 

(a)           Subject to Section ‎6.1, and upon reasonable advance written notice, Seller shall grant, or cause to be granted to, Buyer and its Representatives reasonable access during Seller’s normal business hours throughout the period beginning on the date hereof through the Closing Date (the “Interim Period”) to the Acquired Assets and the books and records and other information relating to the Acquired Assets (subject to any applicable confidentiality agreements, legal restrictions and legal privileges) for the purpose of inspecting the same.  During the Interim Period, Seller shall use all commercially reasonable efforts to 1.  furnish, or cause to be furnished to, Buyer and its Representatives all data and information concerning the Acquired Assets that may reasonably be requested by Buyer, and 2. make available, or cause to be made available, to Buyer and its Representatives, such personnel and employees of Seller and its Affiliates as may reasonably be requested.  Notwithstanding the preceding sentences to the contrary, nothing in this Agreement shall be construed to permit Buyer or its Representatives to have access to any files, records, Contracts or documents of Seller or its Affiliates relating to (a) Seller’s or its Affiliates’ inter-company or intra-company feedstock and product pricing information, internal transfer prices, hedging activity records and business inventory valuation procedures and records, (b) any bids relating to the transactions contemplated by this Agreement and the Ancillary Agreements, (c) any of the Excluded Assets, and (d) the negotiation or execution of this Agreement.

 

5.2           Conduct of Business.

 

(a)           During the Interim Period, and except as expressly contemplated under this Agreement, as required by Law or as or set forth in Schedule 5.2, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed:

 

(i)           Seller shall not enter into any Contract which constitutes a Material Contract if such Material Contract would be an Assumed Contract or amend, rescind, terminate or waive any rights under any Assumed Contract;

 

(ii)           Seller shall conduct its business in the ordinary course of business consistent with past practice;

 

(iii)           Seller shall use reasonable efforts to maintain in full effect all policies of insurance relating to the Acquired Assets existing as of the Agreement Date;

 

(iv)           Seller shall not sell, lease or otherwise transfer or dispose of, or grant or permit, by Seller or its Affiliate’s direct action, any Lien (other than Permitted Liens) on any of the Acquired Assets;

 

(v)           except as reasonably necessary for the safe operation of the Acquired Assets, Seller shall not incur, or commit to incur, any liability or any obligation to make capital expenditures, which would survive the Closing, with respect to the Acquired Assets in excess of $50,000 individually or $150,000 in the aggregate;

 

  

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(vi)           except as reasonably necessary for the safe operation of the Acquired Assets, Seller shall not incur, or commit to incur, any liability or any obligation to make operating expenditures which liability or obligations would become an Assumed Liability other than in the ordinary course of business;

 

(vii)         Seller shall not settle any Action or Claim relating to or affecting the Acquired Assets post-Closing in an amount that exceeds $50,000 or Actions or Claims that collectively exceed $150,000 in the aggregate;

 

(viii)        Seller shall not merge, consolidate, convert, liquidate, dissolve or otherwise wind up its business; or

 

(ix)           neither Seller nor any Affiliate of Seller shall commit itself to do any of the foregoing negative covenants.

 

(b)           Notwithstanding anything in this Agreement to the contrary, Seller shall be permitted to (i) dividend, distribute or transfer all cash on-hand to any Affiliate of Seller before or as of the Closing Date and (ii) take all necessary steps, including any governmental filings, as may be necessary or advisable in connection therewith, provided that no such action may result in, cause or have a Material Adverse Effect on Seller or its Affiliates’ ability to fully perform its obligations under this Agreement.

 

5.3           Schedules.  Prior to the Closing, Seller may, from time to time, by written notice to Buyer, supplement or amend the Disclosure Schedule solely with respect to matters arising on or after the date of this Agreement, and if the Closing occurs, any such supplement or amendment will be effective to cure and correct any breach of any representation, warranty or covenant that would have existed if Seller would not have made such supplement or amendment.  Other than a supplement or amendment relating to matters permitted or consented to under Section 5.2 or matters which do not involve Losses to Buyer in excess of $175,000 in the aggregate, if such supplement or amendment discloses any facts that would reasonably be expected to cause any of the Closing conditions in Article IX not to be satisfied, then the Parties shall negotiate in good faith for a period not to exceed thirty (30) days to determine a reasonable adjustment to the Purchase Price to adequately reflect any Losses estimated to be incurred as a result of such matter; provided, however, that if no such adjustment is agreed by the Parties by the expiration of such period, then either Party shall have the right to terminate this Agreement pursuant to Section 10.1(e).

 

ARTICLE VI

COVENANTS AND AGREEMENTS OF BUYER

 

6.1           Pre-Closing Access and Inspections.

 

(a)           During the Interim Period, Buyer shall not contact or communicate with any employees, customers, suppliers or distributors of Seller or its Affiliates or the Acquired Assets solely in connection with or with respect to this Transaction or any of the matters contemplated by this Agreement, except with Seller’s prior written consent, not to be unreasonably withheld, conditioned or delayed.

 

  

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(b)           Any inspection or investigation conducted by Buyer or its Representatives prior to the Closing ii) shall be conducted in accordance with applicable Laws and in such manner as not to interfere unreasonably with the business of Seller or its Affiliates or the Acquired Assets; or iii) shall not entitle Buyer to conduct any Phase II environmental assessments or any other sampling or testing of soil or ground or surface water at, or under, the Leased Real Property or any real property used in the Pipeline Business, without the prior written consent of Seller, with Buyer being limited to visual inspections of the Acquired Assets and the review of Seller’s and its Affiliates’ records and any other publicly available materials or information with regard to these matters.  Buyer shall bear the risk of injury to any of its Representatives conducting any inspection or investigation of the Acquired Assets; provided however, that Buyer shall not bear such risk if the injury is solely caused by the gross negligence or willful misconduct of Seller, its Representatives or its Affiliates and in such event, Seller shall be fully liable therefore.

 

(c)           Notwithstanding any provision to the contrary contained in this Agreement, Buyer’s and Seller’s obligations under the last sentence in Section 6.1(b) shall survive the Closing or the earlier termination of this Agreement, in accordance with the survival provisions set forth in Section 11.6.

 

6.2           Post-Closing Preservation of Books and Records; Access.

 

(a)           For a period of six (6) years from and after the Effective Time, Buyer shall, and shall cause its Affiliates to, upon receipt of reasonable prior written request from Seller, (i) afford to Seller and its Representatives reasonable access during Buyer’s normal business hours to the Buyer’s employees, Acquired Assets and to the Books and Records delivered to Buyer by Seller at Closing; (ii) provide Seller, at Seller’s expense, with copies of the Books and Records delivered to Buyer by Seller at Closing; and (iii) at Seller’s expense, reasonably cooperate with Seller in all respects, including the making available to Seller of Buyer’s employees as witnesses or deponents, in each case, in respect of (1) financial reporting, (2) Tax or similar purposes, (3) purposes of investigating Claims or pursuing Actions in respect of Third Parties or Governmental Entities (4) addressing environmental matters involving Acquired Assets or (5) any other proper purpose.  Buyer shall, and shall cause its Affiliates to, keep and maintain the Books and Records delivered to Buyer by Seller at Closing for a period of six (6) years from the Closing Date or such longer periods as may be required by applicable Law; provided, however, that if Buyer desires to destroy or dispose of any such records during or after the expiration of such period, then Buyer will first offer to Seller in writing at least sixty (60) days before such destruction or disposition to surrender such records to Seller, and if Seller does not accept such offer within thirty (30) days after receipt of such offer, then Buyer may take such action.

 

(b)           For a period of six (6) years from and after the Effective Time, Seller shall and shall cause its Affiliates to, upon receipt of reasonable prior written request from Buyer, (i) afford to Buyer and its Representatives reasonable access during normal business hours to Seller’s employees and to properties and records of Seller; (ii) provide Buyer, at Buyer’s expense, with copies of any books, records or accounts relating to the Acquired Assets or the Assumed Liabilities; and (iii) at Buyer’s expense, reasonably cooperate with Buyer in all respects, including the making available to Buyer of Seller’s employees as witnesses or 

 

  

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deponents, in each case, in respect of (1) financial reporting, (2) Tax or similar purposes, (3) purposes of investigating Claims or pursuing Actions in respect of Third Parties or Governmental Entities (4) addressing environmental matters involving Acquired Assets or (4) any other proper purpose.   If Seller desires to destroy or dispose of any such records related to the Acquired Assets or Assumed Liabilities during of after the expiration of such six (6) year period, then Seller will first offer to Buyer in writing at least sixty (60) days before such destruction or disposition to surrender such records to Buyer, and if Buyer does not accept such offer within thirty (30) days after receipt of such offer, then Seller may take such action.

 

6.3           Cooperation for Retained Claims.  With respect to all matters that constitute Retained Liabilities or Assumed Liabilities and for so long as Seller or Buyer, as applicable, is contesting or defending such matter in a Third Party Action or any Claim, each Party shall cooperate (at no cost to the cooperating Party) with the other Party, its respective Affiliates and their respective counsel in their efforts to conduct or resolve such matters, including by making available to them such documents and witnesses as may be deemed necessary or useful therefore in that party’s reasonable discretion.

 

6.4           Excluded Intellectual Property.  Buyer agrees that it will not use, and after Closing shall cause its Affiliates not to use, any of the Excluded Intellectual Property.  Buyer acknowledges and agrees with Seller that the Excluded Intellectual Property and the goodwill represented thereby and pertaining thereto, are being retained by Seller and its Affiliates.  Within sixty (60) days following the Closing Date, Buyer shall remove all identifications of Excluded Intellectual Property from all Acquired Assets, line markers materials, supplies, invoices or related items used by Buyer.  Buyer will promptly, but in no event later than thirty (30) days after the Closing Date, contact every appropriate one-call agency in the vicinity of the Acquired Assets and have the contact information for one-calls changed from Seller’s or its Affiliates’ name to Buyer’s name.  Buyer shall also provide revised maps to the one-call agencies where appropriate or required.

 

6.5           Performance Bonds and Guaranties.  Buyer shall use its commercially reasonable efforts to secure the unconditional release, as of the Closing Date, of Seller from the Credit Support Instruments as to the Acquired Assets, including effecting such release by providing guarantees or other substitute credit support (but only to the extent that such substitute credit support applies to the Acquired Assets), and Buyer shall use commercially reasonable efforts to be substituted in all respects for Seller, so that the Buyer shall be solely responsible for the obligations of such Credit Support Instruments.  To the extent Buyer is unable to obtain the release of Seller or the release of any Credit Support Instrument as to the Acquired Assets prior to the Closing Date, Buyer shall indemnify Seller for any and all costs and Losses arising from or relating to such Credit Support Instrument following the Effective Time.  In the event that any Credit Support Instrument has not been terminated and Seller has not been released as of the Closing Date, Seller shall be permitted to terminate such Credit Support Instrument as to the Acquired Assets as promptly as possible under the terms of such Credit Support Instrument.  Seller shall reasonably cooperate with Buyer in assisting Buyer with obtaining such releases to the Credit Support Instruments.

 

6.6           Insurance.  Buyer acknowledges and agrees that all insurance policies maintained by Seller in respect of the Acquired Assets may be terminated by Seller as of the 

 

  

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Effective Time.  Buyer further agrees not to, and to require that no Affiliate shall, make any Claims under such insurance policies.  Buyer agrees to arrange insurance coverage for itself and the Acquired Assets as of the Effective Time with insurers of its own choice.  Buyer further acknowledges that it has no right, title or interest in any unearned premiums on any insurance policies maintained by Seller.

 

6.7           Crude Oil Purchasing Agreement.  Buyer agrees that, if Seller or any of its Affiliates shall, following the Closing, desire to purchase crude oil from Plains Marketing, L.P. at MP 429,588 of the Pipeline, Buyer shall cause Plains Marketing, L.P. to negotiate in good faith with Seller a crude oil purchasing agreement on mutually agreeable terms.

 

 

ARTICLE VII

COVENANTS AND AGREEMENTS OF SELLER AND BUYER

 

7.1           Expenses.  Except as explicitly provided otherwise in this Agreement or by applicable Law, all costs and expenses incurred by the Parties in connection with the consummation of the transactions contemplated hereby shall be borne solely and entirely by the Party which has incurred such expenses.

 

7.2           Injunctions.  If any Governmental Entity having jurisdiction over any Party issues or otherwise promulgates any Order that prohibits the consummation of the transactions contemplated hereby, the Parties will use their commercially reasonable efforts to (a) have such injunction dissolved or otherwise eliminated as promptly as possible and (b) pursue any underlying Action diligently and in good faith prior to and after the Closing.

 

7.3           Payments Received.  Seller and Buyer agree that after the Closing they shall hold and promptly transfer and deliver to the other Party, from time to time as and when received by them, any cash or checks with appropriate endorsements (using their reasonable efforts not to convert such checks into cash), or other property (including Tax refunds) that they may receive at or after the Closing which properly belongs to the other Party.

 

7.4           [Reserved].

 

7.5           HSR Matters.  Buyer and Seller have each filed their respective Notification Reports with the FTC respecting the transactions contemplated by this Agreement and have requested early termination under the HSR Act.  Buyer and Seller shall use their respective commercially reasonable efforts to (a) obtain all authorizations or waivers required under the HSR Act to consummate the transactions contemplated hereby, including making all filings with the Antitrust Division of the DOJ and the FTC required in connection therewith and (b) respond as promptly as practicable to all inquiries received from the DOJ or the FTC for additional information or documentation.  Buyer shall be responsible for paying all filing fees associated with filings under the HSR Act.  Each of Buyer and Seller shall furnish to the other Party such necessary information and reasonable assistance as the other may reasonably request in connection with its preparation of any filing that is necessary under the HSR Act.  Buyer and Seller shall keep each other apprised of the status of any communications with, and any inquiries or requests for additional information from, the FTC or the DOJ. Notwithstanding any term or 

 

  

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provision set forth herein to the contrary, each of Buyer and Seller shall have the right to terminate this Agreement, and their respective Affiliates shall have the right to terminate the Terminal Asset Purchase Agreement upon receipt from the DOJ or FTC of a second inquiry for additional information or documentation after compliance by Seller and Buyer with any such initial inquiry by the DOJ or FTC.  Notwithstanding anything to the contrary contained herein, Buyer shall have no obligation to sell or divest any of its assets or any of the assets of its Affiliates assets pursuant to any Divestiture Order, and Buyer’s (or its Affiliates’) failure to sell or divest any of its assets shall not be deemed to be a breach or default by Buyer of this Agreement.

 

7.6           Public Announcements.  No Party shall issue any press release or other public announcement with respect to this Agreement or the transactions contemplated hereby without the prior written approval of the other Party, not to be unreasonably withheld; except as set forth on Schedule 7.6 or as may be required by such Party or its Affiliates under applicable Law or stock exchange rules.

 

7.7           Confidentiality.

 

(a)           The Parties agree to be bound by the terms and conditions of that certain Confidentiality Agreement between Western Refining, Inc. and Plains Marketing, L.P. entered into on September 28, 2010, as amended by that certain Amendment to Confidentiality Agreement, dated August 30, 2011 (the “Confidentiality Agreement”).  The Parties further agree that the terms and conditions of this Agreement, the Ancillary Agreements and all other transaction documents and all communications in connection with the negotiation of the foregoing shall be deemed “Confidential Information” as such term is defined in, and subject to, the terms of the Confidentiality Agreement.  Effective upon the Closing, the Confidentiality Agreement shall terminate.

 

(b)           From and after the Closing, Seller shall, and shall cause its Affiliates and their respective Representatives to keep confidential and not disclose any information to any Person related to the transaction contemplated herein (including any terms and conditions), except as may be approved by Buyer (the “Restricted Information”).  The obligation to keep such Restricted Information confidential shall continue for three (3) years from the Closing Date and shall not apply to any information which (i) is in the public domain, (ii) is published or otherwise becomes part of the public domain through no fault of Seller or its Affiliates or (iii) becomes available to Seller or its Affiliates on a non-confidential basis from a source that did not acquire such information (directly or indirectly) from Seller or its Affiliates.  Notwithstanding the foregoing, Seller may make disclosures as required by applicable Law or any Governmental Entity and in connection with disputes hereunder; provided that Seller, to the extent practicable, shall deliver to Buyer written notice at least ten (10) Business Days prior to the day Seller is to disclose any Restricted Information so that Buyer may seek a protective order or other appropriate remedy or waive compliance with the provisions of this Section.

 

7.8           Notice of Certain Events.  After the Closing Date, each Party shall promptly notify the other Party of all notices, communications or Actions initiated by any Governmental Entity and known to such Party with respect to the Acquired Assets that would reasonably be 

 

  

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expected to be a basis for an Indemnified Claim by an Indemnified Party pursuant to Section 11.1.

 

7.9           Further Assurances.  After the Closing, each Party shall take such further actions, including obtaining Consents from Third Parties, and execute such further documents as may be reasonably necessary or reasonably requested by any other Party in order to effectuate the intent of this Agreement and the Ancillary Agreement and to provide such other Party with the intended benefits of this Agreement and the Ancillary Agreements.

 

7.10           Tax Matters.

 

(a)           Preparation and Filing of Tax Returns.

 

(i)           With respect to any Tax Return related to the Acquired Assets for a period ending on or before the Closing Date that is required to be filed on or after the Closing Date by Buyer, Seller shall prepare such Tax Return in a manner consistent with prior practices and deliver it to Buyer (along with supporting documentation and with any payment (to be made by wire transfer) required to be made with such Tax Return) at least ten (10) days prior to the due date for such Tax Return.  Seller shall revise such Tax Return to reflect any reasonable changes requested by Buyer and return the same to Buyer for filing no later than two (2) Business Days before the date such Tax Return is required to be filed.  Assuming Seller complies with all time requirements contained in this Section 7.10(a)(i), Buyer shall timely file any such Tax Return with the appropriate Taxing Authority and remit to such Taxing Authority any amount received by Seller pursuant to this Section 7.10(a)(i).

 

(ii)           With respect to any Tax Return related to the Acquired Assets or the Assumed Liabilities for a Straddle Period, Buyer shall provide a draft of such Tax Return to Seller on or prior to the date that is ten (10) days prior to the due date therefore, along with a supporting schedule that shows the allocation of liability for Taxes due with such Tax Return pursuant to Section 7.10(b), for Seller’s review and comment.  Buyer shall revise such Tax Return to reflect any reasonable changes requested by Seller and timely file such Tax Return.

 

(b)           Allocation of Straddle Period Taxes.  In the case of Taxes that are payable with respect to any Straddle Period, Seller shall be responsible for the portion of any such Taxes that is attributable to the portion of the period ending on the Closing Date, determined as follows:

 

(i)           in the case of Taxes that are either (A) based upon or related to income or receipts, or (B) imposed in connection with any sale or other transfer or assignment of property (real or personal, tangible or intangible), deemed equal to the amount that would be payable if the Tax Period ended with (and included) the Closing Date; provided, however, that exemptions, allowances or deductions that are calculated on an annual basis (including depreciation and amortization deductions) shall be allocated between the portion of the Straddle Period ending on and including the day 

 

  

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before the Closing Date and the period beginning on and after the Closing Date in proportion to the number of days in each portion; and

 

(ii)           in the case of Taxes that are imposed on a periodic basis with respect to the assets or capital, deemed to be the amount of such Taxes for the entire Straddle Period (or, in the case of such Taxes determined on an arrears basis, the amount of such Taxes for the immediately preceding period), multiplied by a fraction the numerator of which is the number of calendar days in the portion of the Straddle Period ending on and including the Closing Date and the denominator of which is the number of calendar days in the entire Straddle Period.  Specifically, all ad valorem, property and similar taxes (“Property Taxes”) assessed with respect to the Acquired Assets for calendar year 2011, or calendar year 2012, if applicable, shall be prorated between Seller and Buyer based on their relative number of days of ownership of the Acquired Assets during calendar year 2011 or calendar year 2012, if applicable.  Seller shall pay to Buyer at Closing Seller’s share of the 2011 Property Taxes or the 2012 Property Taxes, if applicable.  To the extent the actual amount of 2011 Property Taxes is not determinable at Closing, Buyer and Seller shall utilize the most recent information available in estimating the amount to be paid by Seller at Closing.  Upon determination of the actual amount of 2011 Property Taxes and 2012 Property Taxes, if applicable, Seller shall pay to Buyer within fifteen (15) days any additional amount necessary to equal Seller’s share of the 2011 Property taxes and the 2012 Property Taxes, if applicable; in the event the amount paid by Seller at Closing exceeds Seller’s share of 2011 Property Taxes or the 2012 Property Taxes, if applicable, Buyer shall refund within fifteen (15) days any such overage to Seller.

 

(c)           Refund and Tax Benefits.

 

(i)           Any Tax refunds related to the Acquired Assets or Assumed Liabilities that are received by Buyer or any of its Affiliates, and any amount credited against Taxes to which Buyer or any of its Affiliates become entitled, that relate to Pre-Closing Tax Period or to the portion of a Straddle Period that ends on the day before the Closing Date shall be for the account of Seller, and Buyer shall pay over to Seller any such refund or the amount of any such credit within fifteen (15) days after receipt or entitlement thereto.

 

(ii)           Any Tax refunds related to the Acquired Assets or Assumed Liabilities that are received by Seller or any of its Affiliates, and any amount credited against Taxes to which Seller or any of its Affiliates become entitled, that relate to any post-Closing Tax Period or to the portion of a Straddle Period that arises on or after the Closing Date shall be for the account of Buyer, and Seller shall pay over to Buyer any such refund or the amount of any such credit within fifteen (15) days after receipt or entitlement thereto.

 

(d)           Tax Assistance.  After the Closing Date, each Party shall provide such assistance as the other Party may from time to time reasonably request in connection with the preparation of Tax Returns required to be filed, any audit or other examination by any taxing authority, any judicial or administrative proceeding relating to liability for Taxes, or any Claim 

 

  

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for refund in respect of such Taxes or in connection with any litigation and proceedings or liabilities related to the Acquired Assets or the Assumed Liabilities, including making available employees for interviews, litigation preparation and testimony.  The requesting Party shall reimburse the assisting Party for the reasonable out-of-pocket costs incurred by the assisting Party after having received the prior written approval therefore from the requesting Party.

 

(e)           Purchase Price Allocation.  The Parties agree to allocate the Purchase Price (and all other capitalizable costs) among the Acquired Assets for all purposes (including financial accounting and Tax purposes) as set forth on Schedule 7.10(e) (the “Purchase Price Allocation”).  Seller and Buyer shall report consistently with the Allocation in all Tax Returns, including IRS Form 8594, which Buyer and Seller shall timely file with the IRS, and neither Buyer nor Seller shall take any position in any Tax Return that is inconsistent with the Purchase Price Allocation unless required to do so by a final determination as defined in Section 1313 of the Code.  Each of Seller and Buyer agree to promptly advise each other regarding the existence of any Tax audit, controversy or litigation related to the Purchase Price Allocation.

 

7.11           Real Estate Matters.  Seller shall, at no cost to Seller, use its commercially reasonable efforts to cooperate with Buyer in (a) obtaining surveys of and information and documentation relating to all Leased Real Property and (b) obtaining a title insurance commitment covering all material Leased Real Property.  All costs incurred in connection with the foregoing, including survey and title insurance costs, shall be borne by Buyer.

 

7.12           Casualty Loss.

 

(a)           If, during the Interim Period, all or any portion of the Acquired Assets are damaged or destroyed in whole or in part (the portion of the Acquired Assets so damaged or destroyed, the “Damaged Portion”), whether by fire, theft, vandalism, flood, wind, explosion or other casualty (a “Casualty Event”), Seller shall notify Buyer promptly in writing (a “Casualty Event Notice”) of the Casualty Event.  The Casualty Event Notice shall include: (i) a reasonable description of the facts and circumstances surrounding the Casualty Event; (ii) Seller’s preliminary assessment of the effect of the Casualty Event on the Acquired Assets; and (iii) Seller’s preliminary assessment of whether, and the extent to which, any losses sustained as a result of such Casualty Event are covered by one or more insurance policies (including property/casualty and workers’ compensation policies) maintained immediately prior to the Closing by the Seller.

 

(b)           If: (i) Seller reasonably expects the Damaged Portion resulting from a Casualty Event can be fully repaired or restored in accordance with applicable Laws on or before 180 days following the occurrence of the Casualty Event (the “Casualty Event Termination Date”); and (ii) the Casualty Event is greater than $2,000,000.00, then Buyer may elect, in its sole discretion, to either (A) repair and restore such Damaged Portion at Buyer’s expense, and Buyer shall be entitled to all of the insurance proceeds which Seller or any of its Affiliates actually receive with respect to such Casualty Event, or (B) notify Seller that Buyer does not elect to repair and restore such Damaged Portion, at which time Seller can elect to either (1) repair or restore such Damaged Portion by the Casualty Event Termination Date, or (2) not repair or restore such Damaged Portion by the Casualty Event Termination Date.  If Seller reasonably expects the Damaged Portion resulting from a Casualty Event cannot be fully repaired or 

 

  

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restored in accordance with applicable Laws on or before the Casualty Event Termination Date, then either Party may either (i) terminate this Agreement or (ii) agree to a mutually acceptable solution related thereto.

 

(c)           If, with respect to any Casualty Event greater than $2,000,000 that Buyer elected not to repair and restore such Damaged Portion, Seller elects to repair or restore such Damaged Portion by the Casualty Event Termination Date, then: (i) Seller shall promptly commence and diligently execute the repair and/or restoration of such Damaged Portion to the condition thereof immediately prior to such Casualty Event in a good and workmanlike manner and in accordance with applicable Laws at its sole cost and expense; (ii) Seller shall be entitled to all of the insurance proceeds to which the Seller or any of its Affiliates are entitled with respect to such Casualty Event; (iii) such Casualty Event shall have no effect for purposes of determining whether Buyer’s conditions to Closing set forth in Section 9.1 or Section 9.2 have been fulfilled; and (iv) the Closing and the Termination Date shall be delayed for such reasonable time as is necessary for Seller to complete any such repair or restoration.

 

(d)           If, with respect to any Casualty Event greater than $2,000,000 that Buyer elected not to repair and restore such Damaged Portion, Seller elects not to repair or restore such Damaged Portion by the Casualty Event Termination Date, then Buyer may elect by written notice to Seller not later than fifteen (15) days after Buyer’s receipt of the Seller’s election not to repair or restore such Damaged Portion to either: (A) proceed to Closing, and (i) neither Party’s rights or obligations under this Agreement shall be affected in any way; (ii) no breach of any representations or warranties under this Agreement shall be deemed to have occurred as a result of such Casualty Event; and (iii) there shall be a reduction in the amount of $2,000,000.00 to the Purchase Price; or (B) elect not to close, at which time either Party may terminate this Agreement.

 

(e)           If the Casualty Event is $2,000,000.00 or less, then: (i) neither Party’s rights or obligations under this Agreement shall be affected in any way; (ii) no breach of any representations or warranties under this Agreement shall be deemed to have occurred as a result of such Casualty Event; and (iii) there shall be no change to the Purchase Price.

 

7.13           ROW.  Buyer and Seller shall use their commercially reasonable efforts to enter into any agreement and cause third parties to enter into any agreements required to ensure that Buyer has the use of any Overlapping ROW Rights necessary for the operation of the Pipeline and Seller has the use of any Overlapping ROW Rights necessary for the operation of Seller’s assets other than the Pipeline currently located upon any Overlapping ROW Rights.  The obligation of Buyer and Seller set forth in this Section 7.13 shall survive Closing.

 

ARTICLE VIII

[Reserved]

 

  

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ARTICLE IX

CONDITIONS TO CLOSING

 

9.1           Conditions to Each Party’s Obligation to Close.  The obligations of Buyer and Seller to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction, at or prior to the Closing, of each of the following conditions:

 

(a)           No Restraint.  No preliminary or permanent Order or other legal restraint preventing the consummation of the transactions contemplated by this Agreement shall be threatened or in effect.

 

(b)           Legality of Transactions.  No Action shall have been taken or threatened and no Law shall have been enacted by any Governmental Entity that makes illegal the performance by any Party of its obligations under this Agreement or the Ancillary Agreements or the consummation of the transactions contemplated by this Agreement.

 

(c)           HSR Waiting Period.  The waiting and review period (and any extension thereof) under the HSR Act shall have expired or been terminated.

 

(d)           Closing under Terminal Asset Purchase Agreement.  Simultaneously with the Closing of the transactions contemplated in this Agreement, the closing of the transactions contemplated by the Terminal Asset Purchase Agreement shall occur.

 

9.2           Conditions to Buyer’s Obligation to Close.

 

(a)           The obligation of Buyer to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction (or waiver by Buyer), at or prior to the Closing, of each of the following conditions:

 

(i)           Representations and Warranties.  The representations and warranties of Seller set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (except to the extent that such representations or warranties speak as of an earlier date, in which case such representations and warranties shall have been true and correct as of such specified date), except to the extent that the failure of such representations and warranties to be true and correct would not, in the aggregate, be reasonably expected to result in a Material Adverse Effect, and Buyer shall have received a certificate to such effect signed on behalf of Seller by an officer of Seller.

 

(ii)           Performance of Obligations.  Seller shall have performed in all material respects the obligations required to be performed by it under this Agreement prior to the Closing Date, and Buyer shall have received a certificate to such effect signed on behalf of Seller by an officer of Seller.

 

(iii)           Ancillary Agreements.  Seller shall have executed and delivered, or caused to be executed and delivered, the Ancillary Agreements; provided that any failure of the Parties to reach final terms on and execute the Transition Services Agreement shall not constitute a failure of a condition to close.

 

  

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(iv)           Material Consents.  Each of the Required Third Party Consents set forth on Schedule 9.2(a)(iv) (the “Material Consents”) shall have been obtained.

 

(v)           Terminal Transaction.  Each of Buyer and Seller or their respective Affiliates, as applicable, shall have performed in all respects its respective obligations, agreements and covenants contained in the Terminal Asset Purchase Agreement required to be performed on or prior to the Closing Date such that transactions contemplated thereby have been consummated concurrently with the Closing under this Agreement.

 

(vi)           Release of Liens.  Seller shall have provided Buyer with documentation reasonably acceptable to Buyer which evidences that those liens against the Acquired Assets set forth in Schedule 2.2(l) have been released.

 

(b)           Notwithstanding the foregoing, Buyer hereby grants a waiver in respect of the closing condition set forth in Section 9.2(a)(iv) to the extent Seller, upon Seller failing to deliver a Material Third Party Consent proposes a reasonable and lawful arrangement pursuant to which Seller would provide Buyer with the substantially the same economic claims, rights and benefits under the Assumed Contract with respect to which the closing condition has not been satisfied prior to the Closing.  Buyer shall cooperate in good faith, at Seller’s expense, with Seller in any such arrangement.  To the extent Buyer is able to so receive the economic claims, rights and benefits under any such arrangement, Buyer shall be responsible for the Assumed Liabilities, if any, arising out of or attributable to such Assumed Contract.  Notwithstanding any such arrangement, Seller shall use its commercially reasonable efforts to assist Buyer in obtaining the Material Consents as quickly as possible following the Closing.

 

9.3           Conditions to Seller’s Obligation to Close.  The obligation of Seller to consummate the transactions contemplated by this Agreement shall be subject to the satisfaction (or waiver by Seller), at or prior to the Closing, of each of the following conditions:

 

(a)           Representations and Warranties.  The representations and warranties of Buyer set forth in this Agreement shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (except to the extent that such representations or warranties speak as of an earlier date, in which case such representations and warranties shall have been true and correct in all material respects as of such specified date), except to the extent that the failure of such representations and warranties to be true and correct would not, in the aggregate, be reasonably expected to result in a Material Adverse Effect, and Seller shall have received a certificate to such effect signed on behalf of Buyer by an officer of the general partner of Buyer.

 

(b)           Performance of Obligations.  Buyer shall have performed in all material respects the obligations required to be performed by it under this Agreement prior to the Closing Date, and Seller shall have received a certificate to such effect signed on behalf of Buyer by an officer of the general partner of Buyer.

 

(c)           Ancillary Agreements.  Buyer shall have executed and delivered, or caused to be executed and delivered, the Ancillary Agreements.

 

  

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(d)           Material Consents.  Each of the Material Consents shall have been obtained.

 

(e)           Terminal Transaction.  Each of Buyer and Seller or their respective Affiliates, as applicable, shall have performed in all respects its respective obligations, agreements and covenants contained in the Terminal Asset Purchase Agreement required to be performed on or prior to the Closing Date such that transactions contemplated thereby have been consummated concurrently with the Closing under this Agreement.

 

ARTICLE X

TERMINATION

 

10.1           Termination.  This Agreement may be terminated at any time prior to the Closing:

 

(a)           by mutual written consent of Buyer and Seller;

 

(b)           by either Buyer or Seller if the Closing shall not have occurred by 90 days following the Agreement Date; provided however that the Parties may mutually extend such date up to two (2) times for thirty (30) day periods each time (the “Termination Date”);

 

(c)           by either Buyer or Seller if a Governmental Entity shall have issued an Order or taken any Action permanently restraining, enjoining, or otherwise prohibiting the transactions contemplated by this Agreement, the Ancillary Agreements, or the Terminal Asset Purchase Agreement and such Order or Action shall have become final and nonappealable;

 

(d)           by either Buyer or Seller in the event of a breach by the other Party of any representation, warranty, covenant or other agreement contained in this Agreement, the Ancillary Agreements, or the Terminal Asset Purchase Agreement which iv) would give rise to the failure of a condition set forth in Section 9.2(a), or Section 9.3(a), and v) cannot be or has not been cured within sixty (60) days following receipt by the breaching Party of written notice of such breach;

 

(e)           by Buyer or Seller pursuant to Section 5.3;

 

(f)           by Buyer or Seller pursuant to Section 7.5;

 

(g)           by Buyer or Seller pursuant to Section 7.12; and

 

(h)           by Buyer, if Buyer is required to sell or divest any of its (or its Affiliates) current assets or any of the Acquired Assets pursuant to any Divestiture Order.

 

10.2           Effect of Termination.  Upon any termination of this Agreement, (expressly excluding termination pursuant to Section 10.1(d) hereof), Seller and Buyer shall be relieved of their respective duties and obligations arising under this Agreement after the date of such termination, and such termination shall be without liability to Seller or Buyer; provided that the provisions of Sections 10.2, 6.1(b), 7.1 and 7.7, Annex A and Article XII, shall survive any such 

 

  

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termination and shall be enforceable hereunder and any defaulting party shall remain liable under this Agreement for all of its liabilities and obligations hereunder.

 

ARTICLE XI

INDEMNIFICATION

 

11.1           Obligations to Indemnify.

 

(a)           Seller’s Obligations.  Subject to the terms of this Article ‎XI, from and after the Closing, Seller shall indemnify, defend and hold harmless the Buyer Indemnified Parties from and against any and all Losses arising or resulting from any one or more of the following:

 

(i)           the Retained Liabilities;

 

(ii)           the breach, non-fulfillment or non-performance by Seller of any agreement, obligation or covenant of Seller in this Agreement to be performed by Seller (or its Affiliates) on or prior to Closing;

 

(iii)           the breach, non-fulfillment or non-performance by Seller of any agreement, obligation or covenant in this Agreement to be performed by Seller (or its Affiliates) after Closing; or

 

(iv)           any breach or inaccuracy of any representation or warranty made by Seller contained in this Agreement or any certificate delivered hereunder.

 

(b)           Buyer’s Obligation.  Subject to the terms of this Article ‎XI, from and after the Closing, Buyer shall indemnify, defend and hold harmless the Seller Indemnified Parties from and against any and all Losses arising or resulting from any of the following:

 

(i)           the Assumed Liabilities;

 

(ii)           the breach, non fulfillment or nonperformance by Buyer of any agreement, obligation or covenant of Buyer in this Agreement to be performed by Buyer (or its Affiliates) on or prior to Closing;

 

(iii)           the breach, non-fulfillment or non-performance by Buyer of any agreement, obligation or covenant in this Agreement to be performed by Buyer (or its Affiliates) after Closing; or

 

(iv)           any breach or inaccuracy of any representation or warranty made by Buyer contained in this Agreement or any certificate delivered hereunder.

 

11.2           Third Party Claims.

 

(a)           If any Indemnified Party receives written notice of the commencement of any Action or proceeding or the assertion of any Claim by a Third Party or the imposition of any penalty or assessment for which indemnity may be sought under this Article ‎XI (a “Third Party 

 

  

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Claim”), and such Indemnified Party intends to seek indemnity pursuant to this Article ‎XI, the Indemnified Party shall promptly provide the other Party (the “Indemnifying Party”) with notice of such Third Party Claim, which notice shall describe such Third Party Claim in reasonable detail, including all relevant factual background) and the basis on which the Indemnified Party is entitled to indemnification hereunder.  The Indemnifying Party shall be entitled, at its option and at its own expense, to assume the defense of such Third Party Claim.  Such defense shall be conducted through counsel selected by the Indemnifying Party and approved by the Indemnified Party, which approval shall not be unreasonably withheld, delayed or conditioned, and the Indemnified Party shall fully cooperate with the Indemnifying Party in connection therewith, at no cost or expense to the Indemnified Party.

 

(b)           Notwithstanding the provisions of Section 11.2(a), each Indemnified Party shall be entitled, at its own expense, to participate in the defense of such Third Party Claim; provided, however, that the Indemnifying Party shall pay the reasonable attorneys’ fees of the Indemnified Party if vi) the employment of separate counsel shall have been authorized in writing by any such Indemnifying Party in connection with the defense of such Third Party Claim, or vii) the Indemnified Party’s counsel, reasonably competent to render advice as to such matters shall have advised the Indemnified Party in writing, with a copy delivered to the Indemnifying Party, that there is a conflict of interest that could make it inappropriate under applicable standards of professional conduct for the Indemnifying Party and the Indemnified Parties to have common counsel.

 

(c)           The Indemnifying Party shall obtain the prior written approval of each Indemnified Party (which approval shall not be unreasonably withheld, delayed or conditioned) before entering into or making any settlement, compromise, admission, or acknowledgment of the validity of any Third Party Claim or any liability in respect thereof if, pursuant to or as a result of such settlement, compromise, admission, or acknowledgment, any injunctive or other equitable relief would be imposed against the Indemnified Party or if, in the reasonable opinion of each Indemnified Party, such settlement, compromise, admission, or acknowledgment could have an adverse effect on its business, operations, assets or financial condition.

 

(d)           The Indemnifying Party shall not consent to the entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the release by each claimant or plaintiff to each Indemnified Party from all liability in respect of such Third Party Claim.

 

11.3           Direct Claims.

 

(a)           Notice of Indemnified Claims.  In any case in which an Indemnified Party seeks indemnification hereunder which is not subject to Section ‎11.2 because no Third Party Claim is involved, the Indemnified Party shall promptly notify the Indemnifying Party in writing of any Losses which such Indemnified Party claims are subject to indemnification under the terms hereof (the “Indemnified Claims”).  Subject to the limitations otherwise set forth in this Article ‎XI, the failure of the Indemnified Party to exercise promptness in such notification shall not amount to a waiver of such claim unless the resulting delay materially prejudices the position of the Indemnifying Party with respect to such claim.

 

  

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(b)           Contested Claims.  Each Indemnified Claim shall viii) reference the indemnity claim to which it relates and shall state the date upon which such indemnity claim was first asserted; ix) describe the nature of the Losses incurred by the Indemnified Party; x) describe the reason why the Losses are recoverable from the Indemnified Party; xi) state the amount of the Losses; and xii) provide copies of all available documentation supporting the amount of the Losses.  The Indemnifying Party shall have thirty (30) days following receipt of an Indemnified Claim to review such claim (the “Review Period”).  The Indemnified Party shall make a representative reasonably available during the Review Period to respond to any questions by the Indemnifying Party concerning the Indemnified Claim.  If the Indemnifying Party objects to all or any portion of the Indemnified Claim (an “Objection”), the Indemnifying Party shall deliver its Objection in writing to the Indemnified Party within the Review Period.  Each such Objection shall state (a) if applicable, why the Indemnified Claim is not recoverable from the Indemnifying Party; (b) the amount of Losses objected to by the Indemnifying Party (the “Contested Amount”); and (c) if applicable, the amount of the Losses not objected to by the Indemnifying Party (the “Uncontested Amount”).

 

(c)           Uncontested Claims.  If the Indemnifying Party fails to tender an Objection within the Review Period, the Indemnifying Party shall promptly (but in any event within five (5) days after expiration of the Review Period) tender payment to the Indemnified Party in the amount of the Indemnified Claim in accordance with Section 11.8.  Upon the Indemnified Party’s receipt of any Objection, the Uncontested Amount, if any, shall promptly (but in any event within five (5) days after such receipt) be tendered by the Indemnifying Party in accordance with Section 11.8.

 

11.4           Materiality.  In determining whether a breach or inaccuracy of any representation or warranty made hereunder exists and in calculating the amount of indemnifiable Losses incurred by any Indemnified Party arising out of or relating to any such breach or inaccuracy, all qualifications relating to “materiality,” “material,” “Material Adverse Effect” or any similar qualification, shall be disregarded.

 

11.5           Limits of Liability.

 

(a)           Deductible; Cap.  No Indemnified Party shall be entitled to be indemnified for Losses pursuant to Sections 11.1(a)(ii), 11.1(a)(iv) or 11.1(b)(iv) unless and until the respective aggregate amount of all such Losses by such Indemnified Party exceeds 1.0% of the Purchase Price (the “Deductible”).  The Indemnified Party shall be entitled to be paid the entire amount of any Losses pursuant to Sections 11.1(a)(ii), 11.1(a)(iv) or 11.1(b)(iv) in excess of the Deductible; provided, however, that the aggregate liability of Seller for Losses under this Agreement shall not exceed twenty five percent (25.0%) of the Purchase Price (the “Cap”).  Notwithstanding the foregoing, the Deductible and the Cap shall not apply to Seller’s or Buyer’s indemnification obligations related to or arising out of any breach of the Fundamental Representations (as defined herein) or for either Party’s indemnification obligations pursuant to Section 11.1(a)(i) or (iii) or Section 11.1(b)(i) or (iii).

 

(b)           Minimum Claim.  If any claim or groups of related claims for indemnification by an Indemnified Party that is indemnifiable under Sections 11.1(a)(ii), 11.1(a)(iv) or 11.1(b)(iv) of this Agreement results in respective aggregate Losses to such 

 

  

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Indemnified Party that do not exceed $100,000, such Losses shall not be deemed to be Losses under this Agreement shall not be applied against the Deductible and shall not be eligible for indemnification under this Article ‎XI.

 

(c)           No Special Damages.  In no event shall any Indemnifying Party be liable to any Indemnified Party with respect to any matter arising under or in relation to this Agreement for any consequential, punitive, exemplary incidental, indirect, special or punitive damages, including loss of future revenue, income or profits, diminution of value or loss of business reputation or opportunity or a multiple of revenue, income, profits or any other amount, except to the extent such damages are included within a judgment rendered against an Indemnified Party with respect to a Third Party Claim for which indemnification is available under the terms of this Article ‎XI.

 

11.6           Survival of Covenants, Representations and Warranties.

 

(a)           The representations, warranties, covenants and agreements of the Parties under this Agreement shall survive the execution and delivery of this Agreement and shall continue in full force and effect until twelve (12) months after the Closing Date; provided, however, that (i) the Fundamental Representations shall survive until the expiration of the applicable statute of limitation which shall begin tolling as of the Effective Time, and (ii) any covenants or agreements contained in this Agreement that by their terms are to be performed after the Closing Date shall survive until fully discharged.  The date on which any such representation, warranty, covenant or agreement no longer survives in accordance with this Section 11.6(a) is referred to herein as the “Expiration Date”.

 

(b)           No action for a breach of any representation, warranty, covenant or agreement contained herein shall be brought after the Expiration Date, except for claims of which a Party has received written notice setting forth in reasonable detail the claimed misrepresentation or breach of representation, warranty, covenant or agreement with reasonable detail, prior to the Expiration Date.

 

11.7           Exclusive Remedy.  After the Closing, the provisions of this Article ‎XI shall be the exclusive basis for assertion of claims against, or the imposition of liability on, any Party by another Party with respect to any breach of, or other failure to meet any obligation under, this Agreement.

 

11.8           Payments.  All payments to be made by an Indemnifying Party to any Indemnified Party pursuant to this Article ‎XI shall be made by wire transfer of immediately available funds to an account designated by the Indemnified Party.  Any payments pursuant to this Article ‎XI shall be treated as an adjustment to the Purchase Price.

 

11.9           Administration of Indemnity Claims.  Notwithstanding anything else in this Article ‎XI, any claim for indemnification pursuant to this Article ‎XI, whether for a Third Party Claim pursuant to Section ‎11.2 or a direct claim pursuant to Section ‎11.3, p) on behalf of a Buyer Indemnified Party must be made and administered by Buyer, or its successors or assigns as permitted herein, and q) on behalf of a Seller Indemnified Party must be made and administered by Seller, or its successors and assigns as permitted herein.

 

  

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ARTICLE XII

MISCELLANEOUS

 

12.1           Notices.

 

(a)           Any notice or other communication given under this Agreement shall be in writing and shall be i) delivered personally, ii) sent by documented overnight delivery service, iii) sent by facsimile or other customary means of electronic transmission (e.g., “pdf”), or iv) sent by first class mail, postage prepaid (certified or registered mail, return receipt requested).  Such notice shall be deemed to have been duly given (a) on the date of the delivery, if delivered personally, (b) on the Business Day after dispatch by documented overnight delivery service, if sent in such manner, (c) on the date of electronic transmission, if so transmitted on a Business Day during normal business hours, and otherwise on the next Business Day, or (d) on the fifth (5th) Business Day after sent by first class mail, postage prepaid, if sent in such manner.

 

(b)           Notices or other communications shall be directed to the following addresses:

 

Notices to Seller:

 

Western Refining, Inc.

123 West Mills, Suite 200

El Paso, Texas 79901

Attention:  Lowry Barfield, Senior Vice President-Legal and General Counsel

Facsimile No.:  (915) 534-2650

with copies to:

 

Vinson & Elkins LLP

1001 Fannin Street, Suite 2500

Houston, Texas  77002

Attention:  Christopher S. Collins, Esq.

Facsimile No.:  (713) 615-5217

Notices to the Buyer:

 

Plains Pipeline, L.P.

333 Clay Street, Suite 1600

Houston, Texas 77002

Attention:  John R. Rutherford, Executive Vice President

Facsimile No.:  (713) 646-4378

  

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with copies to:

 

Plains Pipeline, L.P.

333 Clay Street, Suite 1600

Houston, Texas 77002

Attention:  Lawrence J. Dreyfuss, Vice President

Facsimile No.:  (713) 646-4216

 

(c)           The Parties may at any time change their address for service from time to time by giving notice to the other Party in accordance with this Section ‎12.1.

 

12.2           Entire Agreement; Amendment; Waiver; Exhibits and Schedules.  This Agreement and the Exhibits and Schedules attached hereto and the Ancillary Agreements constitute the entire understanding between the Parties with respect to the subject matter hereof, and supersede all other understandings and negotiations with respect thereto (except for the Confidentiality Agreement).  This Agreement may be amended only in a writing signed by all Parties.  Any provision of this Agreement may be waived only in a writing signed by the Party to be charged with such waiver.  No course of dealing between the Parties shall be effective to amend or waive any provision of this Agreement.  All Exhibits and Schedules attached hereto are hereby incorporated into this Agreement as a part hereof.

 

12.3           Severability.  If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced under applicable Law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated herein are not affected in any manner adverse to any Party.  Upon such determination that any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated herein are consummated as originally contemplated to the fullest extent possible.

 

12.4           Parties in Interest.  This Agreement shall be binding upon and inure solely to the benefit of each Party and its respective successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to confer upon any other Person (other than the Indemnified Parties) any rights or remedies of any nature whatsoever under or by reason of this Agreement.

 

12.5           Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas (except to the extent that mandatory provisions of federal law govern), without giving effect to any choice or conflict of law provision or rule (whether of the State of Texas or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Texas.  Each of the Parties irrevocably agrees that any legal action or proceeding with respect to the Acquired Assets, this Agreement or any Ancillary Agreements or for recognition and enforcement of any judgment in respect hereof shall be brought and determined in any federal or state court located Houston, Harris County, Texas.  Each of the Parties hereby (a) irrevocably submits with regard to any such action or proceeding 

 

  

35

  

 

to the exclusive personal jurisdiction of the aforesaid courts in the event any dispute arises out of this Agreement or any transaction contemplated hereby and waives the defense of sovereign immunity, (b) agrees that it shall not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court or that such action is brought in an inconvenient forum and (c) agrees that it shall not bring any action relating to this Agreement or any transaction contemplated hereby or the Acquired Assets in any court other than the above courts.  Each of the Parties waives trial by jury in any action to which they are parties involving, directly or indirectly, any matter in any way arising out of, related to or connected with this Agreement or the transactions contemplated hereby and thereby or the Acquired Assets.

 

12.6           Assignment.  This Agreement shall be binding upon and inure to the benefit of the Parties and their successors and permitted assigns.  Seller may not assign this Agreement or any rights or obligations hereunder with the prior written consent of Buyer.  Buyer may not assign this Agreement or any rights or obligations hereunder without the prior written consent of Seller, which Seller shall not unreasonably withhold, condition or delay; provided that Seller’s consent shall not be necessary for an assignment to an Affiliate or Buyer; provided that such assignment shall not release Buyer from any obligations hereunder.  Without Seller’s express written consent, no permitted assignment of this Agreement or any rights or obligations hereunder by Buyer to any other Person shall relieve Buyer of its obligations hereunder.

 

12.7           Dispute Resolution.

 

(a)           General.  The Parties agree that if any Dispute arises, it is in the best interests of the Parties for such Dispute to be resolved in the shortest time and with the lowest cost of resolution practicable.  Consequently, the Parties agree to attempt to resolve any Dispute without resort to the courts.  If any Dispute arises, the Parties shall comply with the following procedures:

 

(i)           The Party believing a Dispute to exist will give the other Parties prompt written notice thereof (the “Dispute Notice”), setting forth in reasonable detail the facts alleged to give rise to such Dispute, any relevant contractual provisions, the nature of any claimed default or breach and a statement of the manner in which such Party believes the Dispute should be resolved.

 

(ii)           Within thirty (30) days after receipt of any Dispute Notice, the Party against whom relief is sought in connection with such Dispute Notice shall deliver a written response (the “Dispute Response”), setting forth in reasonable detail its views of the facts alleged to give rise to such Dispute, any relevant contractual provisions, the nature of the claimed default or breach and a statement of the manner in which such Party believes the Dispute should be resolved.

 

(iii)           If the Parties do not agree on the manner in which the Dispute should be resolved, they shall arrange to hold a meeting (a “Dispute Meeting”) within thirty (30) days after delivery of the Dispute Response.  Each Party shall have in attendance at such Dispute Meeting a representative with the authority to resolve such Dispute.  At the Dispute Meeting (and any adjournments thereof), the Parties shall negotiate in an attempt to agree as to whether a Dispute exists, the exact nature of the Dispute and the manner in which the Dispute should be 

 

  

36

  

 

resolved.  If deemed appropriate by the Parties, a mutually agreeable professional mediator shall be engaged to assist in resolving the Dispute.  Any resolution of the Dispute shall be evidenced by a written agreement setting forth in reasonable detail the actions to be taken by each Party.  If no such resolution is reached within thirty (30) days after the initial Dispute Meeting (the “Dispute Negotiation Period”), the Parties may pursue binding arbitration or legal action with respect to such Dispute pursuant to Section 16.1(b) or Section 16.1(c), as applicable.

 

(b)           Mandatory Binding Arbitration.

 

(i)           If any Dispute is unresolved by the end of the Dispute Negotiation Period, the Parties agree that any such Dispute for which the amount at issue does not exceed $1,000,000 shall be determined by confidential, binding, neutral arbitration as provided by the federal arbitration act and Texas substantive law to be conducted in accordance with the JAMS Streamlined Arbitration Rules and Procedures by a single neutral arbitrator.  The Parties agree that the arbitrator shall be a retired United States federal district judge, and in the event that no United States federal district judge is available, a retired judge.  The Parties are giving up any rights each might possess to discovery and appeal of such Disputes and to have such Disputes litigated in a court or by jury trial.  The agreement to this provision is voluntary.

 

(ii)           Unless the Parties agree otherwise, and except as hereinafter provided, the place of arbitration shall be Houston, Harris County, Texas.  The arbitrators shall issue a reasoned written decision and award which shall not exceed $1,000,000 including any interest, costs or any other amounts.

 

(iii)           The Parties shall bear equally the fees and expenses of the arbitration, unless the arbitrators decide otherwise.  Each Party shall bear the costs of its own counsel, witnesses (if any) and employees, unless the arbitrators decide otherwise.

 

(iv)           If the Parties are unable to agree upon a single arbitrator within twenty (20) days of the date on which the Dispute Negotiation Period ends, each Party shall select an arbitrator within twenty-five (25) days of the date on which the Dispute Negotiation Period ends.  If a Party fails to select an arbitrator within such period, the Dallas, Texas office of JAMS shall appoint an arbitrator for such Party.  The two individuals so selected shall select a third individual who shall serve as the arbitrator of the Dispute.  The arbitrator shall be selected no later than forty-five (45) days after the date on which the Dispute Negotiation Period ends, and, if possible, shall be experienced in legal and operational matters related to the industry of the Parties.

 

(v)           The decision rendered by the arbitrator shall be considered the final and binding resolution of the Dispute and will not be subject to appeal.  No Party shall sue the other except for enforcement of the arbitrator’s decision if the other Party is not performing in accordance with the arbitrator’s decision.

 

(vi)           If any Dispute is unresolved by the end of the Dispute Negotiation Period, the Parties agree that any such Dispute for which the amount at issue exceeds $1,000,000, may be resolved in accordance with Texas law and venue and jurisdiction for any litigation regarding such disputes shall be exclusive in the state or federal court(s) of competent 

 

  

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jurisdiction in Houston, County, Texas.  The Parties consent to and waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the bringing of any such action or proceeding in such jurisdiction.

 

(c)           The obligations of the Parties under this Section 12.7 shall survive the expiration or termination of this Agreement.

 

12.8           Specific Performance.  The Parties acknowledge and agree that in the event that any of the provisions of this Agreement are breached or are not performed in accordance with their terms, irreparable damage may occur and that the Parties may not have an adequate remedy at law.  It is accordingly agreed that the Parties shall be entitled to injunctive or other equitable relief, without the posting of any bond and without proof of actual damages, to prevent breaches of this Agreement and to specifically enforce the terms of this Agreement and that the Parties shall not object to the granting of injunctive or other equitable relief on the basis that there exists an adequate remedy at law.

 

12.9           Counterparts.  This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when two or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.  Delivery of an executed signature page of this Agreement by facsimile or other customary means of electronic transmission (e.g., “.pdf”) shall be effective as delivery of a manually executed counterpart hereof.

 

12.10           Expenses.  Except as otherwise provided herein, each Party shall bear its own expenses incurred in connection with this Agreement and the transactions herein contemplated hereby whether or not such transactions shall be consummated, including all fees of its legal counsel, financial advisers and accountants.

 

[Signature Page to Follow]

 

  

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.

 

	  	
PLAINS PIPELINE, L.P.

	  
	  	
By Plains Marketing GP Inc.,

	  
	  	
Its General Partner

	  
	  	  	  	  
	  	  	  	  
	  	
By:

	
/s/Harry N. Pefanis

	  
	  	
Name:

	
Harry N. Pefanis

	  
	  	
Title:

	
President and Chief Operating Officer

	  
	  	  	  	  
	  	  	  	  
	  	
WESTERN REFINING PIPELINE COMPANY

	  
	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	
By:

	
/s/ Jeff A. Stevens

	  
	  	
Name:

	
Jeff A. Stevens

	  
	  	
Title:

	
President and Chief Executive Officer

	  

 

 

  

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ANNEX A

Interpretation; Defined Terms

1.           Interpretation.  It is expressly agreed that this Agreement shall not be construed against any Party, and no consideration shall be given or presumption made, on the basis of who drafted this Agreement or any particular provision hereof or who supplied the form of Agreement.  Each Party agrees that this Agreement has been purposefully drawn and correctly reflects its understanding of the transaction that this Agreement contemplates.  In construing this Agreement:

 

(a)           examples shall not be construed to limit, expressly or by implication, the matter they illustrate;

 

(b)           the word “includes” and its derivatives means “includes, but is not limited to” and corresponding derivative expressions;

 

(c)           a defined term has its defined meaning throughout this Agreement and each Exhibit, Annex and Schedule to this Agreement, regardless of whether it appears before or after the place where it is defined;

 

(d)           each Exhibit, Annex, recital and Schedule to this Agreement is a part of this Agreement, but if there is any conflict or inconsistency between the main body of this Agreement and any Exhibit, Annex or Schedule, the provisions of the main body of this Agreement shall prevail;

 

(e)           the headings and titles herein are for convenience only and shall have no significance in the interpretation hereof;

 

(f)           the inclusion of a matter on a Schedule in relation to a representation or warranty shall not be deemed an indication that such matter necessarily would, or may, breach such representation or warranty absent its inclusion on such Schedule;

 

(g)           any reference to a statute, regulation or law shall include any amendment thereof or any successor thereto and any rules and regulations promulgated thereunder;

 

(h)           currency amounts referenced herein, unless otherwise specified, are in U.S. Dollars;

 

(i)           unless the context otherwise requires, all references to time shall mean time in Houston, Texas;

 

(j)           whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified; and

 

(k)           if a term is defined as one part of speech (such as a noun), it shall have a corresponding meaning when used as another part of speech (such as a verb).

 

  

Annex A - 1

  

2.           References, Gender, Number.  All references in this Agreement to an “Article,” “Section” or “Exhibit” shall be to an Article, Section or Exhibit of this Agreement, unless the context requires otherwise.  All references in this Agreement to a “Schedule” shall be to the Disclosure Schedule, unless the context requires otherwise.  Unless the context clearly requires otherwise, the words “this Agreement,” “hereof,” “hereunder,” “herein,” “hereby,” or words of similar import shall refer to this Agreement as a whole and not to a particular Article, Section, subsection, clause or other subdivision hereof.  Whenever the context requires, the words used herein shall include the masculine, feminine and neuter gender, and the singular and the plural.

 

3.           Defined Terms.  Unless the context expressly requires otherwise, the respective terms defined in this Section ‎3 shall, when used in this Agreement, have the respective meanings herein specified, with each such definition to be equally applicable both to the singular and the plural forms of the term so defined.

 

“Acquired Assets” shall have the meaning set forth in Section 1.1. 

 

“Action” shall mean any Claim, action, suit, investigation, inquiry, proceeding, condemnation or audit by or before any court or other Governmental Entity.

 

“Affiliate” shall mean, with respect to any Person, any other entity that directly or indirectly (through one or more intermediaries or otherwise) controls, is controlled by, or is under common control with such Person.  For purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have correlative meanings.

 

“Agreement” shall have the meaning set forth in the preamble.

 

“Agreement Date” shall have the meaning set forth in the preamble. 

 

“Ancillary Agreements” shall mean Assumed Contracts Assignment, ROW Assignment, Leased Real Property Assignment, Bill of Sale, Transition Services Agreement, Seller Guaranty, and Buyer Guaranty.

 

“Assigned Intellectual Property” shall have the meaning set forth in Section 1.1(f).

 

“Assumed Contracts” shall have the meaning set forth in Section ‎1.1(d).

 

“Assumed Contracts Assignment” shall have the meaning set forth in Section 2.2(c).

 

“Assumed Liabilities” shall have the meaning set forth in Section ‎1.3(a).

 

“Bill of Sale” shall have the meaning set forth in Section 2.2(b).

 

“Books and Records” shall have the meaning set forth in Section ‎1.1(e).

 

“Business” means the pipeline business conducted by Seller using the Pipeline as of the Effective Date.

 

  

Annex A - 2

  

“Business Day” means any day on which banks are open for business in Texas, other than Saturday or Sunday.

 

“Buyer” shall have the meaning set forth in the preamble.

 

“Buyer Guaranty” shall have the meaning set forth in Section 2.3(i).

 

“Buyer Indemnified Parties” means Buyer and each of Buyer’s Affiliates including permitted assigns and successors in interest.

 

“Cap” shall have the meaning set forth in Section 11.5(a).

 

“Casualty Event” shall have the meaning set forth in Section 7.12(a).

 

“Casualty Event Notice” shall have the meaning set forth in Section 7.12(a).

 

“Casualty Event Termination Date” shall have the meaning set forth in Section 7.12(b).

 

“Claim” means a dispute, claim, or controversy whether based on contract, tort, strict liability, statute or other legal or equitable theory (including any claim of fraud, misrepresentation or fraudulent inducement or any question of validity or effect of an agreement).

 

“Closing” shall have the meaning set forth in Section ‎2.1.

 

“Closing Date” shall have the meaning set forth in Section ‎2.1.

 

“Closing Statement” shall have the meaning set forth in Section 2.2(e).

 

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

 

“Confidentiality Agreement” shall have the meaning set forth in Section 7.7(a).

 

“Consents” means all 2) authorizations, approvals, consents or Orders of, or registrations, declarations or filings with, or expiration of waiting periods imposed by, any Governmental Entity, in each case that are necessary in order to consummate the transactions contemplated by this Agreement and the other Ancillary Agreements, and 3) consents and approvals of a Third Party necessary to prevent any conflict with, violation or breach of, or default under, any material Contracts.

 

“Contested Amount” shall have the meaning set forth in Section ‎11.3(b).

 

“Contract” shall mean any written agreement, indenture, instrument, note, bond, loan, lease, sublease, deed of trust, assignment, mortgage, franchise, license agreement, purchase order, binding bid or offer, binding term sheet or letter of intent or memorandum, commitment, letter of credit, including any amendments or modifications thereof.

 

“Credit Support Instruments” shall have the meaning set forth in Section 1.2(g).

 

  

Annex A - 3

  

“Creditor’s Rights Exception” shall have the meaning set forth in Section 3.2.

 

“Custody Transfer Receipt” shall having the meaning set forth in Section 2.2(g).

 

“Damaged Portion” shall have the meaning set forth in Section 7.12(a).

 

“Deactivated Section” means that approximately forty-four (44) mile section of the Pipeline north of the Lynch Station commencing at Lynch MP 474 and terminating at MP 429.588.

 

“Deductible” shall have the meaning set forth in Section ‎11.5(a).

 

“Disclosure Schedule” shall have the meaning set forth in Article III.

 

“Dispute” means any dispute, controversy or claim whether based on contract, tort, statute or other legal or equitable theory (including any claim of fraud, misrepresentation or fraudulent inducement or any question of validity or effect of this Agreement including this clause) arising out of or related to this Agreement and/or any Ancillary Agreements (including any amendments, annexations and extensions) of the breach thereof.

 

“Divestiture Order” means a ruling or request by a Governmental Entity which obligates Buyer (or its Affiliates) to sell, divest, or hold separate any particular assets, categories of assets or lines of business (represented by any assets or lines of business of Buyer or any of its Affiliates), as a condition to such Governmental Entity granting its approval under applicable law (including the HSR Act) with respect to Buyer’s acquisition of the Acquired Assets as contemplated hereby.

 

“Dispute Meeting” shall have the meaning set forth in Section 12.7(a)(iii).

 

“Dispute Negotiation Period” shall have the meaning set forth in Section 12.7(a)(iii).

 

“Dispute Notice” shall have the meaning set forth in Section 12.7(a)(i).

 

“Dispute Response” shall have the meaning set forth in Section 12.7(a)(ii).

 

“DOJ” means the United States Department of Justice.

 

“Effective Time” shall have the meaning set forth in Section ‎2.1.

 

“Environmental Law” means any and all applicable Law relating to pollution, protection, preservation, remediation or restoration of the environment (including, soils, sediments, subsurface soils, surface waters, groundwaters, or atmosphere) or natural resources, including applicable Laws relating to Releases or threatened Releases of Hazardous Materials, or otherwise relating to the generation, manufacture, processing, distribution, use, treatment, storage, transport, or handling of, or exposure of any Person or property to, Hazardous Materials, including, the Clean Air Act, the Comprehensive Environmental Response, Compensation, and Liability Act, the Superfund Amendments and Reauthorization Act, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, the Federal Water Pollution Control Act, 

 

 

  

Annex A - 4

  

 

the Safe Drinking Water Act, the Federal Hazardous Materials Transportation Act, the Occupational Safety and Health Act, the Marine Mammal Protection Act, Endangered Species Act, the National Environmental Policy Act, and the Oil Pollution Act, as each has been amended from time to time and all other environmental conservation and protection laws.

 

“Environmental Permit” shall mean any Permit with respect to the Acquired Assets that is required by applicable Environmental Law.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

“Exchange Act” means the Securities Exchange Act of 1934.

 

“Excluded Assets” shall have the meaning set forth in Section ‎1.2.

 

“Excluded Books and Records” shall have the meaning set forth in Section 1.2(b).

 

“Excluded Contracts” shall have the meaning set forth in Section ‎1.2(h).

 

“Excluded Intellectual Property” shall have the meaning set forth in Section 1.2(i).

 

“Excluded Personal Property” shall have the meaning set forth in Section 1.2(a).

 

“Existing Permits” shall have the meaning set forth in Section 1.2(j).

 

“Expiration Date” shall have the meaning set forth in Section 11.6(a).

 

“Financial Encumbrances” means liens covering the Acquired Assets which secure indebtedness of Seller or Seller’s Affiliates for borrowed money.  

 

“FTC” means the United States Federal Trade Commission.

 

“Fundamental Representations” shall mean Seller’s representations and warranties contained in Section 3.1, Section 3.2, Section 3.3 and Section 3.7(a) and Buyer’s representations and warranties contained in Section 4.1, Section 4.2 and Section 4.3.  

 

“GAAP” means generally accepted accounting principles in the United States of America.

 

“Governing Documents” means with respect to (a) a corporation, its articles or certificate of incorporation and by-laws, (b) a partnership, its certificate of limited partnership or partnership declaration, as applicable, and partnership agreement, (c) a limited liability company, its certificate of formation and limited liability company agreement and (d) any other Person, the other organizational or governing documents of such Person.

 

“Governmental Entity” means any Federal, state, local or foreign court or governmental agency, authority or instrumentality or regulatory body.

 

“Hazardous Material” shall mean any substance that, by its nature or its use, is regulated or as to which liability might arise under any Environmental Law including, any:  (a) chemical, 

 

  

Annex A - 5

  

 

product, material, substance or waste defined as or included in the definition of “hazardous substance,” “hazardous material,” “hazardous waste,” “restricted hazardous waste,” “extremely hazardous waste,” “solid waste,” “toxic waste,” “extremely hazardous substance,” “toxic substance,” “toxic pollutant,” “contaminant,” “pollutant,” or words of similar meaning or import found in any Environmental Law, (b) petroleum hydrocarbons, petroleum products, petroleum substances, natural gas, crude oil, or any components, fractions, or derivatives thereof when Released into the environment, and (c) asbestos containing materials, polychlorinated biphenyls, radioactive materials, urea formaldehyde foam insulation, or radon gas.

 

“HSR Act” means the Hart Scott Rodino Antitrust Improvements Act of 1976.

 

“Indemnification Dispute” means any Dispute arising out of or in connection with any claims for indemnification pursuant to Article XI.

 

“Indemnified Claims” shall have the meaning set forth in Section 11.3(a).

 

“Indemnified Parties” means the Buyer Indemnified Parties and the Seller Indemnified Parties, as applicable.

 

“Indemnifying Party” shall have the meaning set forth in Section 11.2(a).

 

“Intellectual Property” means, in respect of any Person, any and all intellectual property rights, under the Laws of the United States of America or any other jurisdiction, including all Trademarks, know-how, copyrights, copyright registrations and applications for registration, Patents, and all other intellectual property rights (including internet domain names), whether registered or not, including the goodwill related to the foregoing, that is licensed to or owned by such Person.

 

“Interim Period” shall have the meaning set forth in Section ‎5.1(a).

 

“JAMS” means JAMS, Inc.

 

“Jal Station” means Seller’s leasehold interest pursuant to that certain New Mexico State Land Office Lease BL 1935 (Jal Station) between Commissioner of Public Lands and Western Refining Pipeline Company dated September 9, 2009

 

“Knowledge” and any variations thereof or words to the same effect shall mean 4) with respect to Buyer:  William D. Edwards and L. David Rabinowitz; and 5) with respect to Seller, all information actually known to the following persons: Mark Smith and Ann Allen after making reasonable inquiry of the following employees: Ron Copple.

 

“Law” means all applicable statutes, laws, rules, regulations, Orders, ordinances, writs, injunctions, judgments and decrees of all Governmental Entities.

 

“Leased Real Property” shall have the meaning set forth in Section 1.1(a).

 

“Leased Real Property Assignment” shall have the meaning set forth in Section 2.2(a).

 

  

Annex A - 6

  

“Liens” means, collectively, any mortgage, pledge, lien, claim, charge, security interest, restriction, lease, tenancy, license, other possessory interest, right of purchase, conditional sales obligation, restriction, covenant, condition or other encumbrance of any kind.

 

“Linefill” means all condensate and crude oil owned by Third Parties as linefill in the Pipeline.

 

“Losses” means any and all losses, costs, obligations, liabilities, settlement payments, awards, judgments, fines, penalties, damages (including wrongful death, personal injury or property damage), private or governmental environmental response and cleanup costs (on-site or off-site), environmental closure and post-closure financial assurance costs, private or governmental natural resource damage claims, medical monitoring costs, expenses (including those incurred with investigating, preparing, defending, bringing or prosecuting any claim, action, suit or proceeding and including, but not limited to, all costs and expenses of all attorneys, experts, and consultants in all tribunals and whether or not legal proceedings are commenced by or against an Indemnified Party and including, without limitation, those related to title gaps and other title matters requiring curative work), deficiencies or other charges.  Notwithstanding the foregoing, in determining the amount of any Losses for which a Party is entitled to indemnification pursuant to ‎ARTICLE XI, the amount of such Losses shall be reduced by all insurance proceeds or other Third Party recoveries.

 

 “Lynch Station” means Seller’s leasehold interest pursuant to that certain Lease Agreement dated July 1, 2006, between Daniel C. Berry, III, and Elizabeth Berry (“Lessor”) and Giant Pipeline Company (n/k/a Western Refining Pipeline Company) for 5.7797 acres at Lynch Pump Station.

 

 “Material Adverse Effect” means any occurrence, condition, change, event or effect that that has a material and adverse effect on the Acquired Assets, taken as a whole, or that materially impairs the ability of a Party or any of its Affiliates to perform their respective obligations under this Agreement and the other Ancillary Agreements to which they are parties or prevents the consummation of the transactions contemplated hereby and thereby; provided, however, that “Material Adverse Effect” shall exclude any occurrence, condition, change, event or effect (i) generally affecting (a) the industries in which such Party or any of its respective Affiliates operate; (b) the global economy or the economy of the Unites States of America; or (c) any financial, capital, credit or securities markets; or (ii) resulting from or relating to (a) any fluctuations in interest or exchange rates or of the prices of steel, oil and gas; (b) any changes in Law, GAAP or other accounting standards after the date of this Agreement, or prospective changes in Law, GAAP or other accounting standards, or any changes or prospective changes in the interpretation or enforcement of any of the foregoing, or any changes or prospective changes in general legal, regulatory or political conditions; (c) any default by the United States of America on any of its debt obligations, or any change or prospective change in the rating of debt obligations of the United States of America by one or more Nationally Recognized Statistical Rating Organizations; (d) any outbreak or escalation of hostilities, declared or undeclared acts of war, terrorism or insurrection, or act of piracy; (e) any national emergency or the occurrence of any other calamity or crisis, including pandemics, earthquakes, hurricanes, tornados or other natural disasters, or changes in weather or climate in general; (f) the announcement or pendency of the transactions contemplated by this Agreement, including any termination of, reduction in or 

 

  

Annex A - 7

  

 

similar negative impact on relationships, contractual or otherwise, with any customers, suppliers, distributors, partners, members, managers or employees of Seller and its Affiliates due to the announcement or pendency of the transactions contemplated by this Agreement; (g) any action taken by such Party or its respective Affiliates that (A) is described in, and permitted to be taken without consent under, this Agreement or (B) was taken at the other Party’s request or upon its advance written consent pursuant to this Agreement, (h) the failure by Seller to take any action that is prohibited by this Agreement to the extent the other Party fails to give its prompt and unconditioned consent thereto after a request therefore by the other Party; (i) any change resulting or arising from the identity of, or any facts or circumstances relating to such a Party or any of its respective Affiliates; (j) any actions taken by such a Party or any of its respective Affiliates; (k) any change or prospective change in the rating of debt obligations of such Party by one or more Nationally Recognized Statistical Rating Organizations; (l) any change in the trading prices or trading volume of such Party’s capital stock or its debt; (m) the failure of such Party to meet internal or analysts’ expectations or projections; and (n) the compliance by such Party with the terms of this Agreement; provided, further, that any occurrence, condition, change, event or effect referred to in clause (a) above may be taken into account in determining whether or not there has been a Material Adverse Effect to the extent such occurrence, condition, change, event or effect has a materially disproportionate adverse effect on the Acquired Assets, taken as a whole, as compared to similar assets of third Persons, in which case the incremental materially disproportionate impact or impacts may be taken into account in determining whether or not there has been or may be a Material Adverse Effect.

 

“Material Consent” shall have the meaning set forth in Section 9.2(a)(iv). 

 

“Material Contract” shall mean any Contract with an actual or possible term of one (1) year or more or having an aggregate or possible aggregate value in excess of $100,000.00. 

 

“Objection” shall have the meaning set forth in Section ‎11.3(b).

 

“Order” shall mean any order, writ, injunction, decree, compliance or consent order or decree, settlement agreement, schedule and similar binding legal agreement issued by or entered into with a Governmental Entity.

 

“Overlapping ROW Rights” shall mean any ROW Rights upon which the Pipeline and Seller’s assets other than the Pipeline are located as of the Agreement Date. 

 

“Party” and “Parties” shall have the meaning set forth in the preamble.

 

“Permits” shall mean any applicable permits, licenses, variances, exemptions, Orders, franchises and approvals of any Governmental Entity.

 

 “Permitted Liens” shall mean any of the following matters:

 

 (a)any (i) inchoate Liens or similar charges constituting or securing the payment of expenses which were incurred incidental to the operation, storage, transportation, shipment, handling, repair, construction, improvement or maintenance of the Acquired Assets, and (ii) materialman’s, mechanics’, repairman’s, employees’, contractors’, operators’, warehousemen’s, barge or ship owner’s and carriers’ Liens or other similar Liens, security 

 

  

Annex A - 8

  

 

interests or charges for liquidated amounts arising in the ordinary course of business incidental to the operation of the Acquired Assets, in the case of (i) and (ii) above, each securing amounts the payment of which is not delinquent and that will be paid in the ordinary course of business or, if delinquent, that are being contested in good faith with any Action to foreclose or attach any of the Acquired Assets on account thereof properly stayed;

 

 (b)any Liens for Taxes not yet delinquent or, if delinquent, that are being contested by Seller or any Affiliate of Seller in good faith in the ordinary course of business and disclosed in Schedule 3.9;

 

 (c)any Liens or security interests reserved in any Assumed Contracts or in any leases, rights of way or other real property interests conveyed as part of the ROW Rights for rental or for compliance with the terms of such Assumed Contracts, leases, rights of way or other real property interests, provided payment of the debt secured is not delinquent or, if delinquent, is being contested in good faith in the ordinary course of business, and any Liens attached to the fee title interest of the Leased Real Property;

 

 (d)all prior reservations of minerals in and under or that may be produced from any of the lands constituting part of the Acquired Assets or on which any part of the Acquired Assets is located;

 

 (e)rights reserved to or vested in any Governmental Entity to control or regulate any of the Acquired Assets and all Laws of such authorities, including any building or zoning ordinances and all Environmental Law;

 

 (f)any Contract, easement, instrument, Lien, permit, amendment, extension or other matter entered into by a Party in accordance with the terms of this Agreement or in compliance with the approvals or directives of the other Party made pursuant to this Agreement;

 

 (g)any Lien created by Buyer;

 

 (h)all Post-Closing Consents;

 

 (i)restrictive covenants, easements, rights-of-way (including utility rights-of-way), servitudes, and other burdens and defects, imperfections or irregularities of title that are disclosed in any title insurance commitments obtained by Buyer covering any of the Leased Real Property or ROW Rights; 

 

 (j)discrepancies, conflicts, shortages in area or boundary lines, encroachments or protrusions, overlapping of improvements, or other matters: (i) that may reasonably be expected to be shown or identified by a survey or physical inspection (whether or not made) of the Leased Real Property or ROW Rights, and/or (ii) that are in fact disclosed or identified in any surveys of the Leased Real Property or ROW Rights that are obtained by Buyer; and

 

 (k)all liens, charges, encumbrances, defects or irregularities which, individually or in the aggregate, do not materially detract from the value of the Acquired Assets 

 

  

Annex A - 9

  

 

as currently used or materially interfere with the current operation or use of the Acquired Assets or the Business.

 

Notwithstanding the foregoing, Permitted Liens shall not include Financial Encumbrances.  

 

“Person” means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, Governmental Entity or other entity.

 

“Personal Property” shall have the meaning set forth in Section 1.1(b).

 

“Pipeline” shall have the meaning set forth in the recitals.

 

“Pipeline Reactivation” shall have the meaning set forth in Section 1.5(a).

 

“Pipeline Reactivation Costs” shall have the meaning set forth in Section 1.5(a).

 

“Post-Closing Consents” shall mean (a) any consent, approval or permit of, or filing with or notice to, any Governmental Entity, railroad company or public utility which has issued or granted any Permit, right of way, lease or other authorizations permitting any part of any pipeline included in the Acquired Assets to cross or be placed on land owned or controlled by such Governmental Entity, railroad company or public utility; and (b) any Consent or Permit, or filing with or notice to, any Governmental Entity or other Third Party that is customarily obtained or made after closing in connection with transactions similar in nature to the transactions contemplated hereby.

 

“Pre-Closing Tax Period” means any Tax Period ending on or before the Closing Date and that portion of any Straddle Period ending on the Closing Date.

 

“Property Taxes” shall have the meaning set forth in Section 7.10(b)(ii).

 

“Purchase Price” shall have the meaning set forth in Section 1.4.

 

“Purchase Price Allocation” shall have the meaning set forth in Section 7.10(e).

 

“Reimbursable Costs” shall have the meaning set forth in Section 1.5(b).

 

 “Reimbursable Costs Cap” shall have the meaning set forth in Section 1.5(b). 

 

 “Release” shall mean any depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding, abandoning, emptying, discharging, migrating, injecting, escaping, leaching, dumping, or disposing into the environment.

 

 “Representatives” means, with respect to any Person, such Person’s officers, directors, employees, agents and other representatives (including investment bankers and underwriters or initial purchasers of securities, lenders and their respective attorneys or consultants, and the attorneys or consultants retained by such Person).

 

 “Required Third Party Consents” shall have the meaning set forth in Section 3.3.

 

  

Annex A - 10

  

 “Restricted Information” shall have the meaning set forth in Section 7.7(b).

 

 “Retained Liabilities” shall have the meaning set forth in Section 1.3(b).

 

 “Review Period” shall have the meaning set forth in Section 11.3(b).

 

 “ROW Assignment” shall have the meaning set forth in Section 2.2(o).

 

 “ROW Rights” shall have the meaning set forth in Section 1.1(g).

 

 “Seller” shall have the meaning set forth in the preamble.

 

 “Seller Guaranty” shall have the meaning set forth in Section 2.2(h).

 

 “Seller Indemnified Parties” means Seller and each of Seller’s Affiliates, permitted assigns and successors in interest.

 

 “Straddle Period” means any Tax period beginning on or before and ending after the Closing Date.

 

 “Tax Period” means any period prescribed by any Government Entity for which a Tax Return is required to be filed or a Tax is required to be paid.

 

 “Tax Return” means any return, declaration, report or similar statement required to be filed with respect to any Taxes (including any attached schedules) including any information return, claim for refund, amended return and declaration of estimated Taxes.

 

  “Taxes” means any charges, fees, levies, excises or other assessments (and all related interest, additions to tax and penalties) imposed by any Governmental Entity.

 

 “Taxing Authority” means any Governmental Entity exercising any authority to Tax or Tax regulatory authority.

 

 “Terminal Asset Purchase Agreement” means that certain Asset Purchase Agreement, dated as of even date herewith, by and between Plains Marketing, L.P., and Western Refining Yorktown, Inc., pursuant to which Plains Marketing, L.P., shall acquire, among other things, that petroleum storage and distribution terminal facility owned by Western Refining Yorktown, Inc. and located in Grafton, Virginia.

 

 “Termination Date” shall have the meaning set forth in Section 10.1(b).

 

 “Third Party” means any Person other than the Parties and their respective Affiliates.

 

 “Third Party Claim” shall have the meaning set forth in Section 11.2(a).

 

 “Trademarks” means any and all trademarks, trademark registrations, trademark applications, service marks, service mark registrations, service mark applications, trade dress, word marks, word mark registrations, word mark applications, trade names and logos.

 

  

Annex A - 11

  

 “Transaction” means the transactions contemplated by this Agreement and the Ancillary Agreements.

 

 “Transition Services Agreement” shall have the meaning set forth in Section 2.2(d).

 

 “Uncontested Amount” shall have the meaning set forth in Section 11.3(b).

 

Annex A - 12Exhibit 4.2

 

 

	 

 

 

AETNA INC.,

 

ISSUER

 

and

 

STATE STREET BANK AND TRUST COMPANY,

 

TRUSTEE

 

__________

 

SENIOR INDENTURE

 

Dated as of March 2, 2001

 

__________

 

Senior Debt Securities

 

 

	 

 

 

  

  

  

Reconciliation and tie between certain Sections of

this Senior Indenture, dated as of March 2, 2001, and

Sections 310 through 318, inclusive, of

the Trust Indenture Act of 1939:

 

	
Trust Indenture

	  	  
	
Act Section

	  	
Indenture Section

	 	 	 
	
§ 310(a)(1)

	  	
‎609

	
         (a)(2)

	  	
‎609

	
         (a)(3)

	  	
Not Applicable

	
         (a)(4)

	  	
Not Applicable

	
         (b)

	  	
‎608

	  	  	
‎610

	
§ 311(a)

	  	
‎613

	
         (b)

	  	
‎613

	
§ 312(a)

	  	
‎701

	  	  	
‎702(a)

	
         (b)

	  	
‎702(b)

	
         (c)

	  	
‎702(c)

	
§ 313(a)

	  	
‎703(a)

	
         (b)

	  	
‎703(a)

	
         (c)

	  	
‎703(a)

	
         (d)

	  	
‎703(b)

	
§ 314(a)

	  	
‎704

	
         (a)(4)

	  	
‎101

	  	  	
‎1004

	
         (b)

	  	
Not Applicable

	
         (c)(1)

	  	
‎102

	
         (c)(2)

	  	
‎102

	
         (c)(3)

	  	
Not Applicable

	
         (d)

	  	
Not Applicable

	
         (e)

	  	
‎102

	
§ 315(a)

	  	
‎601

	
         (b)

	  	
‎602

	
         (c)

	  	
‎601

	
         (d)

	  	
‎601

	
         (e)

	  	
‎514

	
§ 316(a)

	  	
‎101

	
         (a)(1)(A)

	  	
‎502

	  	  	
‎512

	
         (a)(1)(B)

	  	
‎513

	
         (a)(2)

	  	
Not Applicable

 

 

i

  

  

 

	
         (b)

	  	
‎508

	
         (c)

	  	
‎104(c)

	
§ 317(a)(1)

	  	
‎503

	
         (a)(2)

	  	
‎504

	
         (b)

	  	
‎1003

	
§ 318(a)

	  	
‎107

___________________

	
NOTE:

	
This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Senior Indenture.

 

ii

  

  

 

TABLE OF CONTENTS

 

Page

	
PARTIES

	  	
1

	
RECITALS

	  	
1

	  	  	  	  
	
ARTICLE ONE

	  	  
	  	
Definitions and Other Provisions of General Application

	
1

	  	
Section 101.

	
Definitions

	
1

	  	
Section 102.

	
Compliance Certificates and Opinions

	
9

	  	
Section 103.

	
Form of Documents Delivered to Trustee

	
9

	  	
Section 104.

	
Acts of Holders; Record Dates

	
10

	  	
Section 105.

	
Notices, Etc., to Trustee and Company

	
12

	  	
Section 106.

	
Notice to Holders; Waiver

	
12

	  	
Section 107.

	
Conflict with Trust Indenture Act

	
13

	  	
Section 108.

	
Effect of Headings and Table of Contents

	
13

	  	
Section 109.

	
Successors and Assigns

	
13

	  	
Section 110.

	
Separability Clause

	
13

	  	
Section 111.

	
Benefits of Indenture

	
13

	  	
Section 112.

	
Governing Law

	
13

	  	
Section 113.

	
Legal Holidays

	
14

	  	
Section 114.

	
Personal Immunity from Liability for Incorporators, Stockholders, Etc.

	
14

	
ARTICLE TWO

	  
	  	
Security Forms

	
14

	  	
Section 201.

	
Forms Generally

	
14

	  	
Section 202.

	
Form of Face of Security

	
15

	  	
Section 203.

	
Form of Reverse of Security

	
17

	  	
Section 204.

	
Form of Legend for Global Securities

	
22

	  	
Section 205.

	
Form of Trustee’s Certificate of Authentication

	
22

	
ARTICLE THREE

	  
	  	
The Securities

	
23

	  	
Section 301.

	
Amount Unlimited; Issuable in Series

	
23

	  	
Section 302.

	
Denominations

	
26

	  	
Section 303.

	
Execution, Authentication, Delivery and Dating

	
26

	  	
Section 304.

	
Temporary Securities

	
28

	  	
Section 305.

	
Registration, Registration of Transfer and Exchange

	
29

	  	
Section 306.

	
Mutilated, Destroyed, Lost and Stolen Securities

	
30

	  	
Section 307.

	
Payment of Interest; Interest Rights Preserved

	
31

	  	
Section 308.

	
Persons Deemed Owners

	
33

 

 

  

i

  

 

	  	
Section 309.

	
Cancellation

	
33

	  	
Section 310.

	
Computation of Interest

	
34

	
ARTICLE FOUR

	  	  
	  	
Satisfaction and Discharge

	
34

	  	
Section 401.

	
Satisfaction and Discharge of Indenture

	
34

	  	
Section 402.

	
Application of Trust Fund

	
36

	
ARTICLE FIVE

	  	  
	  	
Remedies

	  	
36

	  	
Section 501.

	
Events of Default

	
36

	  	
Section 502.

	
Acceleration of Maturity; Rescission and Annulment

	
39

	  	
Section 503.

	
Collection of Indebtedness and Suits

	  
	  	  	
for Enforcement by Trustee

	
41

	  	
Section 504.

	
Trustee May File Proofs of Claim

	
42

	  	
Section 505.

	
Trustee May Enforce Claims Without

	  
	  	  	
Possession of Securities

	
43

	  	
Section 506.

	
Application of Money Collected

	
43

	  	
Section 507.

	
Limitation on Suits

	
43

	  	
Section 508.

	
Unconditional Right of Holders to

	  
	  	  	
Receive Principal, Premium and Interest

	
44

	  	
Section 509.

	
Restoration of Rights and Remedies

	
45

	  	
Section 510.

	
Rights and Remedies Cumulative

	
45

	  	
Section 511.

	
Delay or Omission Not Waiver

	
45

	  	
Section 512.

	
Control by Holders

	
45

	  	
Section 513.

	
Waiver of Past Defaults

	
46

	  	
Section 514.

	
Undertaking for Costs

	
47

	
ARTICLE SIX

	  	  
	  	
The Trustee

	  	
47

	  	
Section 601.

	
Certain Duties and Responsibilities

	
47

	  	
Section 602.

	
Notice of Defaults

	
47

	  	
Section 603.

	
Certain Rights of Trustee

	
48

	  	
Section 604.

	
Not Responsible for Recitals or Issuance of Securities

	
49

	  	
Section 605.

	
May Hold Securities

	
49

	  	
Section 606.

	
Money Held in Trust

	
49

	  	
Section 607.

	
Compensation and Reimbursement

	
50

	  	
Section 608.

	
Disqualification; Conflicting Interests

	
50

	  	
Section 609.

	
Corporate Trustee Required; Eligibility.

	
50

	  	
Section 610.

	
Resignation and Removal; Appointment of Successor

	
51

	  	
Section 611.

	
Acceptance of Appointment by Successor

	
52

	  	
Section 612.

	
Merger, Conversion, Consolidation or Succession to

	  
	  	  	
Business

	
54

	  	
Section 613.

	
Preferential Collection of Claims Against Company

	
54

	  	
Section 614.

	
Appointment of Authenticating Agent

	
54

 

 

  

ii

  

 

	
ARTICLE SEVEN

	  	  
	  	
Holders’ Lists and Reports by Trustee and Company

	
56

	  	
Section 701.

	
Company to Furnish Trustee Names and Addresses

	  
	  	  	
of Holders

	
56

	  	
Section 702.

	
Preservation of Information; Communications to Holders

	
57

	  	
Section 703.

	
Reports by the Trustee

	
57

	  	
Section 704.

	
Reports by the Company

	
57

	
ARTICLE EIGHT

	  	  
	  	  	
Consolidation, Merger, or Sale of Assets

	
58

	  	
Section 801.

	
The Company May Consolidate, Etc., Only on Certain Terms

	
58

	  	
Section 802.

	
Successor Substituted

	
58

	
ARTICLE NINE

	  	  
	  	  	
Supplemental Indentures

	
59

	  	
Section 901.

	
Supplemental Indentures Without Consent of Holders

	
59

	  	
Section 902.

	
Supplemental Indentures with Consent of Holders

	
60

	  	
Section 903.

	
Execution of Supplemental Indentures

	
62

	  	
Section 904.

	
Effect of Supplemental Indentures

	
62

	  	
Section 905.

	
Conformity with Trust Indenture Act

	
62

	  	
Section 906.

	
Reference in Securities to Supplemental Indentures

	
62

	  	
Section 907.

	
Waiver of Compliance by Holders

	
62

	
ARTICLE TEN

	  	  
	  	
Covenants

	  	
63

	  	
Section 1001.

	
Payment of Principal, Premium and Interest

	
63

	  	
Section 1002.

	
Maintenance of Office or Agency by the Company

	
63

	  	
Section 1003.

	
Money for Securities Payments to be Held in Trust

	
64

	  	
Section 1004.

	
Statement by Officers as to Default

	
65

	  	
Section 1005.

	
Limitations on Liens on Common Stock of

	  
	  	  	
Principal Subsidiaries

	
65

	
ARTICLE ELEVEN

	  	  
	  	
Redemption of Securities

	
66

	  	
Section 1101.

	
Applicability of Article.

	
66

	  	
Section 1102.

	
Election to Redeem; Notice to Trustee

	
66

	  	
Section 1103.

	
Selection by Trustee of Securities to Be Redeemed

	
66

	  	
Section 1104.

	
Notice of Redemption

	
67

	  	
Section 1105.

	
Deposit of Redemption Price

	
67

	  	
Section 1106.

	
Securities Payable on Redemption Date

	
68

	  	
Section 1107.

	
Securities Redeemed in Part

	
68

	
ARTICLE TWELVE

	  	  
	  	
Defeasance and Covenant Defeasance

	
68

	  	
Section 1201.

	
Company’s Option to Effect Defeasance or Covenant Defeasance

	
68

	  	
Section 1202.

	
Defeasance and Discharge

	
69

	  	
Section 1203.

	
Covenant Defeasance

	
69

	  	
Section 1204.

	
Conditions to Defeasance or Covenant Defeasance

	
70

 

 

  

iii

  

 

	  	
Section 1205.

	
Deposited Money and U.S. Government Obligations or Foreign Government Obligations to be Held in Trust; Other Miscellaneous Provisions

	
72

	  	
Section 1206.

	
Reinstatement

	
73

	
ARTICLE THIRTEEN

	  	  
	  	
Sinking Funds

	
74

	  	
Section 1301.

	
Applicability of Article

	
74

	  	
Section 1302.

	
Satisfaction of Sinking Fund Payments with Securities

	
74

	  	
Section 1303.

	
Redemption of Securities for Sinking Fund

	
74

TESTIMONIUM

SIGNATURES AND SEALS

ACKNOWLEDGMENTS

  

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SENIOR INDENTURE, dated as of March 2, 2001, between AETNA INC., a corporation duly organized and validly existing under the laws of the Commonwealth of Pennsylvania (herein called the “Company”), having its principal office at 151 Farmington Avenue, Hartford, Connecticut 06156, and STATE STREET BANK AND TRUST COMPANY, a state-chartered trust company duly organized and existing under the laws of the Commonwealth of Massachusetts, as Trustee (herein called the “Trustee”).

 

RECITALS

 

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its debentures, notes or other evidences of indebtedness (herein called the “Securities”), to be issued in one or more series as in this Indenture provided.

 

All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Securities or of each series thereof, as follows:

 

 

ARTICLE ONE

 

Definitions and Other Provisions

of General Application

 

Section 101.      Definitions.

 

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

 

(1)       the terms defined in this ‎Article One have the meanings assigned to them in this ‎Article One and include the plural as well as the singular;

 

(2)       all other terms used herein which are defined in the Trust Indenture Act or the Securities Act of 1933, as amended, either directly or by reference therein, have the meanings assigned to them therein;

 

  

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(3)       all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted at the date of such computation;

 

(4)       the words “Article” and “Section” refer to an Article and Section, respectively, of this Indenture; and

 

(5)       the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

 

“Act”, when used with respect to any Holder, has the meaning specified in ‎Section 104(a).

 

“Authenticating Agent” means any Person authorized by the Trustee pursuant to ‎Section 614 to act on behalf of the Trustee to authenticate Securities of one or more series.

 

“Board of Directors” means either (i) the Board of Directors of the Company, the Executive Committee of such Board of Directors or any other duly authorized committee of directors and/or officers appointed by such Board of Directors or Executive Committee, or (ii) one or more duly authorized officers of the Company to whom the Board of Directors of the Company or a committee thereof has delegated the authority to act with respect to the matters contemplated by this Indenture.

 

“Board Resolution” means (i) a copy of a resolution certified by the Corporate Secretary or an Assistant Corporate Secretary of the Company to have been duly adopted by the Board of Directors or a committee thereof and to be in full force and effect on the date of such certification or (ii) a certificate signed by the authorized officer or officers of the Company to whom the Board of Directors of the Company or a committee thereof has delegated its authority (as described in the definition of Board of Directors), and in each case, delivered to the Trustee.

 

“Business Day”, when used with respect to any Place of Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment are authorized or obligated by law or executive order to close.

 

  

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“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Common Stock” means with respect to any Principal Subsidiary, stock of any class, however designated, except stock which is non-participating beyond fixed dividend and liquidation preferences and the holders of which have either no voting rights or limited voting rights entitling them, only in the case of certain contingencies, to elect less than a majority of the directors (or persons performing similar functions) of such Principal Subsidiary, and shall include securities of any class, however designated, which are convertible into such Common Stock.

 

“Company” means the Person named as the “Company” in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

 

“Company Request” or “Company Order” means a written request or order signed in the name of the Company by (i) any two of the following individuals:  the Chairman, the President, a Vice Chairman, or a Vice President of the Company, or (ii) one of the foregoing individuals and by any other Vice President, the Treasurer, an Assistant Treasurer, the Corporate Secretary or an Assistant Corporate Secretary of the Company or any other individual authorized by the Board of Directors for such purpose, and delivered to the Trustee.

 

“Corporate Trust Office” means the principal office of the Trustee located at 2 Avenue de Lafayette, Boston, MA 02111 or such other office at which at any particular time the Trustee’s corporate trust business shall be administered.

 

“corporation” means a corporation, association, company, joint-stock company or business trust.

 

“Covenant Defeasance” has the meaning specified in ‎Section 1203.

 

“Defaulted Interest” has the meaning specified in ‎Section 307.

 

“Defeasance” has the meaning specified in ‎Section 1202.

 

“Depositary” means, with respect to Securities of any series issuable in whole or in part in the form of one or more Global Securities, a clearing agency registered under the Exchange Act that is designated to act as Depositary for such Securities as contemplated by ‎Section 301.

 

  

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“Event of Default” has the meaning specified in ‎Section 501.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute thereto.

 

“Floating or Adjustable Rate Provision” means a formula or provision, specified in or pursuant to a Board Resolution or an indenture supplemental hereto, providing for the determination, whether pursuant to objective factors or pursuant to the sole discretion of any Person (including the Company), and periodic adjustment of the interest rate borne by a Floating or Adjustable Rate Security.

 

“Floating or Adjustable Rate Security” means any Security which provides for interest thereon at a periodic rate that may vary from time to time over the term thereof in accordance with a Floating or Adjustable Rate Provision.

 

“Foreign Government Obligations” has the meaning specified in ‎Section 1204.

 

“Global Security” means a Security that evidences all or part of the Securities of any series and is authenticated and delivered to, and registered in the name of, the Depositary for such Securities or a nominee thereof.

 

“Holder” means a Person in whose name a Security is registered in the Security Register.

 

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof, including, for all purposes of this instrument and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively.  The term “Indenture” shall also include the terms of each particular series of Securities established as contemplated by ‎Section 301.

 

“interest”, when used with respect to an Original Issue Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity.

 

“Interest Payment Date”, when used with respect to any Security, means the Stated Maturity of an instalment of interest on such Security.

 

“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an instalment of principal becomes due 

 

  

4

  

 

and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise.

 

“Non-Recourse Debt” means any indebtedness for money borrowed as to which the liability of the Company or the Principal Subsidiaries is limited solely to specific assets.

 

“Notice of Default” means a written notice of the kind specified in ‎Section 501(4).

 

“Officers’ Certificate” means a certificate signed by (i) any two of the following individuals:  the Chairman, the President, a Vice Chairman or a Vice President of the Company, or (ii) one of the foregoing individuals and by any other Vice President, the Treasurer, an Assistant Treasurer, the Corporate Secretary or an Assistant Corporate Secretary of the Company or any other individual authorized by the Board of Directors for such purpose, and delivered to the Trustee.  Each such certificate shall comply with Section 314 of the Trust Indenture Act and include the statements provided for in ‎Section 102.  One of the officers signing an Officers’ Certificate given pursuant to ‎Section 1004 shall be the principal executive, financial or accounting officer of the Company.

 

“Opinion of Counsel” means a written opinion of counsel, who may be an employee of or counsel to the Company or who may be other counsel reasonably satisfactory to the Trustee.  Each such opinion shall comply with Section 314 of the Trust Indenture Act and include the statements provided for in ‎Section 102.

 

“Original Issue Discount Security” means any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to ‎Section 502.

 

“Outstanding”, when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except:

 

(i)         Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation;

 

(ii)         Securities for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such 

 

  

5

  

 

redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;

 

(iii)         Securities as to which Defeasance has been effected pursuant to ‎Section 1202; and

 

(iv)         Securities which have been paid pursuant to ‎Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company;

 

provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (A) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon acceleration of the Maturity thereof pursuant to ‎Section 502, (B) the principal amount of a Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner contemplated by ‎Section 301 on the date of original issuance of such Security, of the principal amount (or, in the case of an Original Issue Discount Security, the U.S. dollar equivalent on the date of original issuance of such Security of the amount determined as provided in (A) above) of such Security, and (C) Securities owned by the Company or any other obligor upon the Securities or any Subsidiary of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which the Trustee knows to be so owned shall be so disregarded.  Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Subsidiary of the Company or of such other obligor.

 

“Paying Agent” means any Person (including without limitation the Company) authorized by the Company to pay the principal of or any premium or interest on any Securities on behalf of the Company.

 

  

6

  

“Person” means any individual, corporation, partnership, limited liability company, joint venture, trust, unincorporated organization or government or any agency or political subdivision thereof.

 

“Place of Payment”, when used with respect to the Securities of any series, means the place or places where the principal of and any premium and/or interest on the Securities of that series are payable as specified in accordance with ‎Section 301.

 

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under ‎Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Security.

 

“Principal Subsidiary” means a consolidated subsidiary of the Company that, as of the time of the determination of whether such consolidated subsidiary is a “Principal Subsidiary,” accounted for 10% or more of the total assets of the Company and its consolidated subsidiaries, in each case as set forth in the most recent balance sheet filed by the Company with the Securities and Exchange Commission.

 

“Redemption Date”, when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

 

“Redemption Price”, when used with respect to any Security to be redeemed, means the price at which such Security is to be redeemed pursuant to this Indenture.

 

“Regular Record Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by ‎Section 301.

 

“Responsible Officer”, when used with respect to the Trustee, means the chairman or any vice-chairman of the board of directors, the chairman or any vice-chairman of the executive committee of the board of directors, the chairman of the trust committee, the president, any vice president, the secretary, any assistant secretary, the treasurer, any assistant treasurer, the cashier, any assistant cashier, any trust officer or assistant trust officer, the controller or any assistant controller 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 

 

  

7

  

 

matter is referred because of his or her knowledge of and familiarity with the particular subject.

 

“Securities” has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture.

 

“Security Register” and “Security Registrar” have the respective meanings specified in ‎Section 305.

 

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to ‎Section 307.

 

“Stated Maturity”, when used with respect to any Security or any instalment of principal thereof or interest thereon, means the date specified in such Security as the fixed date on which the principal of such Security or such instalment of principal or interest is due and payable.

 

“Subsidiary” of any Person means a corporation more than 50% of the voting power of which is controlled, directly or indirectly, by such Person or by one or more other Subsidiaries of such Person or by such Person and one or more other Subsidiaries of such Person.  For the purposes of this definition, “voting power” means the power to vote for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by reason of any contingency.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, “Trustee” as used with respect to the Securities of any series shall mean the Trustee with respect to Securities of that series.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed; provided, however, that if the Trust Indenture Act of 1939 is amended after such date, “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended.

 

“U.S. Government Obligations” has the meaning specified in ‎Section 1204.

 

  

8

  

“Vice President”, when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president”.

 

Section 102.      Compliance Certificates and Opinions.

 

Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee such certificates and opinions as may be required under the Trust Indenture Act.  Each such certificate or opinion shall be given in the form of an Officers’ Certificate, if to be given by an officer of the Company, or an Opinion of Counsel, if to be given by counsel, and shall comply with the requirements of the Trust Indenture Act and any other requirements set forth in this Indenture.

 

Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (excluding certificates provided for in ‎Section 1004) shall include

 

(1)       a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

 

(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;

 

(3)       a statement that, in the opinion of each such individual, such individual has made such examination or investigation as is necessary to enable such individual to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)       a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

 

Section 103.      Form of Documents Delivered to Trustee.

 

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

 

  

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Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the counsel’s certificate, opinion or representations with respect to the legal matters upon which such officer’s certificate or opinion is based are erroneous.  Any such certificate or opinion of counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company unless such counsel knows, or in the exercise of reasonable care should know, that the officer’s or officers’ certificate, opinion or representations with respect to the matters upon which such counsel’s certificate or opinion is based are erroneous.

 

Any certificate, statement or opinion of or representation by an officer of the Company or of counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of, or representations by, an accountant or firm of accountants in the employ of the Company, unless such officer or counsel, as the case may be, knows, or in the exercise of reasonable care should know, that the accountant’s or accountants’ certificate, opinion or representations with respect to the accounting matters upon which such officer’s or counsel’s certificate, statement or opinion is based are erroneous.

 

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

 

Section 104.       Acts of Holders; Record Dates.

 

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company.  Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments.  Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to ‎Section 601) conclusive in favor of the Trustee and the Company if made in the manner provided in this ‎Section 104.

 

  

10

  

(b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him or her the execution thereof.  Where such execution is by a signer acting in a capacity other than such signer’s individual capacity, such certificate or affidavit shall also constitute sufficient proof of such signer’s authority.  The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

 

(c) The Company may, in the circumstances permitted by the Trust Indenture Act, fix any calendar day as the record date for the purpose of determining the Holders of Outstanding Securities of any series entitled to give or take any request, demand, authorization, direction, notice, consent, waiver or other action, or to vote on any action, authorized or permitted to be given or taken by Holders of Outstanding Securities of such series.  If not set by the Company prior to the first solicitation of a Holder of Securities of such series made by any Person in respect of any such action, or, in the case of any such vote, prior to such vote, the record date for any such action or vote shall be the 30th calendar day (or, if later, the date of the most recent list of Holders required to be provided pursuant to ‎Section 701) prior to such first solicitation or vote, as the case may be.  With regard to any record date for any action to be taken by the Holders of one or more series of Securities, only the Holders of Securities of such series on such date (or their duly designated proxies) shall be entitled to give or take, or vote on, the relevant action.

 

(d) The ownership of Securities shall be proved by the Security Register or by a certificate of the Security Registrar.

 

(e) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

 

(f) Without limiting the foregoing, a Holder entitled hereunder to give or take any action hereunder with regard to any particular Security may do so with regard to all or any part of the principal amount of such Security or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any different part of such principal amount.

 

  

11

  

Section 105.       Notices, Etc., to Trustee and Company.

 

Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

 

(1)       the Trustee, by any Holder or by the Company, shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office, Attention: Corporate Trust Department, or

 

(2)       the Company, by the Trustee or by any Holder, shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, in the case of the Company, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first paragraph of this instrument, Attention:  Treasurer, or at any other address previously furnished in writing to the Trustee by the Company.

 

Section 106.       Notice to Holders; Waiver.

 

Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at its address as it appears in the Security Register, not later than the latest date (if any), and not earlier than the earliest date (if any), prescribed for the giving of such notice; provided, however, that the Company or the Trustee, upon a good faith determination that mailing is in the circumstances impractical, may give such notice by any other method which, in the reasonable belief of the Company or, in the case of the Trustee, of the Company and the Trustee, is likely to be received by the Holders.  In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to any other Holder.  Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

 

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give any notice hereunder to any 

 

  

12

  

 

Holder by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.

 

Section 107.       Conflict with Trust Indenture Act.

 

If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act that is required under the Trust Indenture Act to be a part of and govern this Indenture, the applicable Trust Indenture Act provision shall control.  If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the applicable Trust Indenture Act provision shall be deemed to apply to this Indenture as so modified or to be so excluded, as the case may be.

 

Section 108.       Effect of Headings and Table of Contents.

 

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

 

Section 109.       Successors and Assigns.

 

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

 

Section 110.       Separability Clause.

 

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

 

Section 111.       Benefits of Indenture.

 

Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors and permitted assigns hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

Section 112.       Governing Law.

 

This Indenture and the Securities shall be governed by and construed in accordance with the internal laws of the State of New York.

 

  

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Section 113.       Legal Holidays.

 

In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities (other than a provision of the Securities of any series which specifically states that such provision shall apply in lieu of this ‎Section 113)) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date, or at the Stated Maturity, provided that no interest shall accrue with respect to such payment for the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be, except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such Interest Payment Date or Redemption Date, or at the Stated Maturity, as the case may be.

 

Section 114.       Personal Immunity from Liability for Incorporators, Stockholders, Etc.

 

No recourse shall be had for the payment of the principal of or premium, if any, or interest, if any, on any Security, or for any claim based thereon, or otherwise in respect of any Security, or based on or in respect of this Indenture or any indenture supplemental hereto, against any incorporator, or against any past, present or future stockholder, director, officer, employee or agent, as such, of the Company or of any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being expressly waived and released as a condition of, and as consideration for, the execution of this Indenture and the issue of the Securities.

 

 

ARTICLE TWO

 

Security Forms

 

Section 201.       Forms Generally.

 

The Securities of each series shall be in substantially the form set forth in this ‎Article Two, or in such other form as shall be established by or pursuant to a Board Resolution of the Company or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and 

 

  

14

  

 

other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistent herewith, be determined by the officers executing such Securities, as evidenced by their execution of the Securities.  If the form of Securities of any series is established by action taken pursuant to a Board Resolution of the Company, a copy of an appropriate record of such action shall be certified by the Corporate Secretary or an Assistant Corporate Secretary of the Company and delivered to the Trustee at or prior to the delivery of the Company Order contemplated by ‎Section 303 for the authentication and delivery of such Securities.

 

The definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities.

 

Section 202.       Form of Face of Security.

 

[Insert any legend required by the Internal Revenue Code and the regulations thereunder.]

 

AETNA INC.

 

[...%] [ZERO COUPON] SENIOR [NOTE] [DEBENTURE] DUE...

 

No. .........                                                                                                       [$] ........

 

AETNA INC., a Pennsylvania corporation (herein called the “Company”, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to .............................................., or registered assigns, the principal sum of ................ ................... [Dollars] [if other than Dollars, substitute other currency or currency units] upon presentation and surrender of this note on ............................................., [if the Security is to bear interest prior to Maturity, insert --  and to pay interest thereon from ............. or from the most recent Interest Payment Date to which interest has been paid or duly provided for, [semi-annually on ............ and ............ in each year] [If other than semi-annual payments, insert frequency of payments and payment dates], commencing ........., at [If the Security is to bear interest at a fixed rate, insert -- the rate of ....% per annum [If the Security is a Floating or Adjustable Rate Security, insert  -- a rate per annum [computed-determined] in accordance with the [insert defined name of Floating or Adjustable Rate Provision] set forth below] [If the security is to bear interest at a rate determined with reference to an index, refer to description of index below] until the principal hereof is paid or

 

  

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made available for payment [if applicable, insert -- , and (to the extent that the payment of such interest shall be legally enforceable) at the rate of ....% per annum on any overdue principal and premium and on any overdue instalment of interest].  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the ....... or ....... (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 calendar days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture].

 

[If the Securities are Floating or Adjustable Rate Securities with respect to which the principal of or any premium or interest may be determined with reference to an index, insert the text of the Floating or Adjustable Rate Provision.]

 

[If the Security is not to bear interest prior to Maturity, insert -- The principal of this Security shall not bear interest except in the case of a default in payment of principal upon acceleration, upon redemption or at Stated Maturity and in such case the overdue principal of this Security shall bear interest at the rate of ....% per annum (to the extent that the payment of such interest shall be legally enforceable), which shall accrue from the date of such default in payment to the date payment of such principal has been made or duly provided for.  Interest on any overdue principal shall be payable on demand.  Any such interest on any overdue principal that is not so paid on demand shall bear interest at the rate of ......% per annum (to the extent that the payment of such interest shall be legally enforceable), which shall accrue from the date of such demand for payment to the date payment of such interest has been made or duly provided for, and such interest shall also be payable on demand.]

 

Payment of the principal of (and premium, if any) and [if applicable, insert -- any such] interest on this Security will be made at the office or agency of the Company maintained for that purpose in ............, in such coin or currency [of the United States of America] [if the Security is denominated in a currency other than U.S. dollars, specify other currency or currency unit in which payment of the principal of and any premium or interest may be made] as at the time of payment 

 

  

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is legal tender for payment of public and private debts [if applicable, insert -- ; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register].

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

 

Dated:

 

	
AETNA INC.

 

 

	
By    

	  

[Seal]

 

Attest:

 

...........................

 

 

Section 203.       Form of Reverse of Security.

 

This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”),  issued and to be issued in one or more series under a Senior Indenture, dated as of January __, 2001 (herein called the “Indenture”), between the Company, as Issuer, and State Street Bank and Trust Company, as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered.  This Security is one of 

 

  

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the series designated on the face hereof[, [initially] limited in aggregate principal amount to [$]...........] [, subject to future issuances of additional Securities pursuant to ‎Section 301 of the Indenture].

 

[If applicable, insert -- The Securities of this series are subject to redemption upon not less than 30 calendar days’ nor more than 60 calendar days’ notice by mail, [if applicable, insert -- (1) on ........... in any year commencing with the year ...... and ending with the year ...... through operation of the sinking fund for this series at a Redemption Price equal to 100% of the principal amount, and (2)] at any time [on or after ................], as a whole or in part, at the election of the Company, at the following Redemption Prices (expressed as percentages of the principal amount):  If redeemed [on or before ..............., ...%, and if redeemed] during the 12-month period beginning ............. of the years indicated,

 

	
Year

	
Redemption

      Price      

	
Year

	
Redemption

      Price      

	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	  	  	  

and thereafter at a Redemption Price equal to .....% of the principal amount, together in the case of any such redemption [if applicable, insert -- (whether through operation of the sinking fund or otherwise)] with accrued interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor Securities, of record at the close of business on the relevant Record Dates referred to on the face hereof, all as provided in the Indenture.]

 

[If applicable, insert -- The Securities of this series are subject to redemption upon not less than 30 calendar days’ nor more than 60 calendar days’ notice by mail, (1) on ............ in any year commencing with the year .... and ending with the year .... through operation of the sinking fund for this series at the Redemption Prices for redemption through operation of the sinking fund (expressed as percentages of the principal amount) set forth in the table below, and (2) at any time [on or after ............], as a whole or in part, at the election of the Company, at the Redemption Prices for redemption otherwise than through operation of the sinking fund (expressed as percentages of the principal amount) set forth in the table below.  If redeemed during the 12-month period beginning ............ of the years indicated,

 

 

	  	
Redemption Price

For Redemption

	
Redemption Price For

 

  

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Year

	
Through Operation

of the

    Sinking Fund

	
Redemption Otherwise

Than Through Operation

    of the Sinking Fund

	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  

and thereafter at a Redemption Price equal to .....% of the principal amount, together in the case of any such redemption (whether through operation of the sinking fund or otherwise) with accrued interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor Securities, of record at the close of business on the relevant Record Dates referred to on the face hereof, all as provided in the Indenture.]

 

[The sinking fund for this series provides for the redemption on ............ in each year beginning with the year ....... and ending with the year ...... of [not less than] [$].......... [(“mandatory sinking fund”) and not more than [$].........] aggregate principal amount of Securities of this series.  Securities of this series acquired or redeemed by the Company otherwise than through [mandatory] sinking fund payments may be credited against subsequent [mandatory] sinking fund payments otherwise required to be made [in the inverse order in which they become due].]

 

[If the Security is subject to redemption, insert -- If this Security is redeemed in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof.]

 

[If the Security is not an Original Issue Discount Security, insert -- If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.]

 

[If the Security is an Original Issue Discount Security, insert -- If an Event of Default with respect to Securities of this series shall occur and be continuing, an amount of principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture.  Such amount shall be equal to -- insert formula for determining the amount.  Upon payment

 

  

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(i) of the amount of principal so declared due and payable and (ii) of interest on any overdue principal and overdue interest (in each case to the extent that the payment of such interest shall be legally enforceable), all of the Company’s obligations in respect of the payment of the principal of and interest, if any, on the Securities of this series shall terminate.]

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time Outstanding of each series to be affected.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Security at the times, place and [rate-rates], and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or such Holder’s attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of [$]....... and any integral multiple thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of 

 

  

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Securities of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange of Securities, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to ‎Section 304, ‎906 or ‎1107 of the Indenture not involving any transfer.

 

Prior to due and proper presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security is overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

The Indenture provides that the Company, at the Company’s option, (a) will be discharged from any and all obligations in respect of the Securities (except for certain obligations to register the transfer or exchange of Securities, replace stolen, lost or mutilated Securities, maintain paying agencies and hold moneys for payment in trust) or (b) need not comply with certain restrictive covenants of the Indenture, in each case if the Company deposits, in trust, with the Trustee money, or U.S. Government Obligations (or Foreign Government Obligations if the Securities are denominated in a foreign currency or currencies) which through the payment of interest thereon and principal thereof in accordance with their terms will provide money, in an amount sufficient to pay all the principal (including any mandatory sinking fund payments) of, and (premium, if any) and interest on, the Securities on the dates such payments are due in accordance with the terms of such Securities, and certain other conditions are satisfied.

 

No recourse shall be had for the payment of the principal of (and premium, if any) or interest on this Security, or for any claim based hereon, or otherwise in respect hereof,  or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer, employee, agent or director, as such, past, present or future, of the Company or of any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

  

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Section 204.       Form of Legend for Global Securities.

 

Every Global Security authenticated and delivered hereunder shall bear legends in substantially the following form or such other legends as may be required:

 

This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of a Depositary or a nominee thereof.  This Security may not be transferred to, or registered or exchanged for Securities registered in the name of, any Person other than the Depositary or a nominee thereof, and no such transfer may be registered except in the limited circumstances described in the Indenture.  Every Security authenticated and delivered upon registration of transfer of, or in exchange for or in lieu of, this Security shall be a Global Security subject to the foregoing, except in such limited circumstances.

 

[Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), to Aetna Inc. or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is 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.]

 

Section 205.       Form of Trustee’s Certificate of Authentication.

 

The Trustee’s certificate of authentication shall be in substantially the following form:

 

This is one of the Securities of the series designated under, and referred to in, the within-mentioned Indenture.

 

	
 ................................................................. , 

	
As Trustee

 

	
By.............................................................

	
Authorized Officer

 

  

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ARTICLE THREE

 

The Securities

 

Section 301.       Amount Unlimited; Issuable in Series.

 

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

 

The Securities may be issued in one or more series.  There shall be established in or pursuant to Board Resolutions of the Company and set forth in an Officers’ Certificate of the Company or established in one or more indentures supplemental hereto, prior to the issuance of Securities of any series:

 

(1)       the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series);

 

(2)       any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture and any limitation on the ability of the Company to increase such aggregate principal amount after the initial issuance of the Securities of that series (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Sections ‎304, ‎305, ‎306, ‎906 or ‎1107 and except for any Securities which, pursuant to ‎Section 303, are deemed never to have been authenticated and delivered hereunder);

 

(3)       the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest;

 

(4)       the date or dates on which the principal of the Securities of the series is payable;

 

(5)       the rate or rates at which the Securities of the series shall bear interest, if any, or the Floating or Adjustable Rate Provision pursuant to which such rates shall be determined, the date or dates from which such interest shall accrue, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date for any interest payable on any Interest Payment Date;

 

(6)       whether the Securities of the series would be secured pursuant to ‎Section 901(6);

 

  

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(7)       the place or places where the principal of and any premium and interest on Securities of the series shall be payable;

 

(8)       if applicable, the period or periods within which, the price or prices at which (including premium, if any) and the terms and conditions upon which Securities of the series may or are required to be redeemed or prepaid, in whole or in part, at the option of the Company pursuant to a sinking fund or otherwise;

 

(9)       the obligation, if any, of the Company to redeem or purchase Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;

 

(10)      if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable;

 

(11)      if other than such coin or currency of the United States of America as at the time is legal tender for payment of public or private debts, the currency or currencies, including composite currencies, or currency units in which payment of the principal of and any premium and interest on any Securities of the series shall be payable and the manner of determining the equivalent thereof in the currency of the United States of America for purposes of the definition of “Outstanding” in ‎Section 101;

 

(12)      if the amount of payments of principal of or any premium or interest on any Securities of the series may be determined with reference to one or more indices, the manner in which such amounts shall be determined;

 

(13)      if the principal of or any premium or interest on any Securities of the series is to be payable, at the election of the Company or a Holder thereof, in one or more currencies, including composite currencies, or currency units other than that or those in which the Securities are stated to be payable, the currency or currencies, including composite currencies, or currency units in which payment of the principal of and any premium and interest on Securities of such series as to which such election is made shall be payable, and the periods within which and the terms and conditions upon which such election is to be made;

 

  

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(14)      if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to ‎Section 502 or provable under any applicable federal or state bankruptcy or similar law pursuant to ‎Section 503;

 

(15)      if applicable, that the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depositary or Depositaries for such Global Security or Global Securities and any circumstance other than those set forth in ‎Section 305 in which any such Global Security may be transferred to, and registered and exchanged for Securities registered in the name of, a Person other than the Depositary for such Global Security or a nominee thereof and in which any such transfer may be registered;

 

(16)      any other event or events of default applicable with respect to the Securities of the series in addition to those provided in ‎Section 501(1) through ‎(7);

 

(17)      any other covenant or warranty included for the benefit of Securities of the series in addition to (and not inconsistent with) those included in this Indenture for the benefit of Securities of all series, or any other covenant or warranty included for the benefit of Securities of the series in lieu of any covenant or warranty included in this Indenture for the benefit of Securities of all series, or any provision that any covenant or warranty included in this Indenture for the benefit of Securities of all series shall not be for the benefit of Securities of the series, or any combination of such covenants, warranties or provisions;

 

(18)      any restriction or condition on the transferability of the Securities of the series;

 

(19)      any authenticating or paying agents, registrars or any other agents with respect to the Securities of the series; and

 

(20)      any other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture, except as permitted by ‎Section 901(5)).

 

All Securities of any one series shall be substantially identical except as to denomination and number and except as may otherwise be provided in or pursuant to the Board Resolutions referred to above and set forth in the applicable Officers’ Certificate or in any such indenture supplemental hereto.  All Securities of any one series need not be issued at the same time and may be issued from time to 

 

  

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time (with any subsequent issuance of additional Securities which are part of a prior series to be effected in accordance with the terms of this Indenture) if so provided by or pursuant to such Board Resolutions or in any such indenture supplemental hereto and any forms and terms of Securities to be issued from time to time may be completed and established from time to time prior to the issuance thereof by procedures described by such Board Resolutions or in any such indenture supplemental hereto.

 

If any of the terms of any series are established by action taken pursuant to a Board Resolution of the Company, a copy of such action shall be delivered to the Trustee.

 

Section 302.       Denominations.

 

The Securities of each series shall be issuable in registered form without coupons in such denominations as shall be specified as contemplated by ‎Section 301.  In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof.

 

Section 303.       Execution, Authentication, Delivery and Dating.

 

The Securities shall be executed on behalf of the Company by its Chairman, its President, a Vice Chairman, any Vice President, its Treasurer or Assistant Treasurer, under its corporate seal reproduced thereon attested by its Corporate Secretary or one of its Assistant Corporate Secretaries.  The signature of any of these officers on the Securities may be manual or facsimile.

 

The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Securities.  Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company notwithstanding the fact that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities.  Minor typographical and other minor errors in the text of any Security or minor defects in the seal or facsimile signature on any Security shall not affect the validity or enforceability of such Security if such Security has been duly authenticated and delivered by the Trustee.

 

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with a Company Order of the Company for the authentication and delivery of such Securities, and the Trustee in accordance with such Company Order shall authenticate and deliver such 

 

  

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Securities.  If the form or terms of the Securities of the series have been established in or pursuant to one or more Board Resolutions as permitted by Sections ‎201 and ‎301, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to ‎Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating,

 

(a) if the form or forms of such Securities have been established by or pursuant to a Board Resolution as permitted by ‎Section 201, that such form or forms have been established in conformity with the provisions of this Indenture;

 

(b) if the terms of such Securities have been established by or pursuant to a Board Resolution as permitted by ‎Section 301, that such terms have been established in conformity with the provisions of this Indenture; and

 

(c) that such Securities, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and legally binding obligations of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and other similar laws of general applicability relating to or affecting creditors’ rights and remedies generally or the rights and remedies of creditors of insurance companies generally and to general principles of equity (regardless of whether considered in a proceeding at law or in equity).

 

The Trustee shall have the right to decline to authenticate and deliver any Securities under this ‎Section 303 if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith by its board of directors, executive committee or a trust committee of directors or responsible officers of the Trustee shall determine that such action would expose the Trustee to personal liability to existing Holders of Securities.

 

Notwithstanding the provisions of  ‎Section 301 and of the preceding paragraph, if all Securities of a series are not to be originally issued at one time, it shall not be necessary to deliver the Officers’ Certificate otherwise required pursuant to  ‎Section 301 or the Company Order and Opinion of Counsel otherwise required pursuant to this ‎Section 303 at or prior to the time of authentication of each Security of such series if such documents are delivered at or prior to the time of authentication upon original issuance of the first Security of such series to be issued.

 

  

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Each Security shall be dated the date of its authentication.

 

No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein executed by the Trustee by manual signature, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and that such Security is entitled to the benefits of this Indenture.  Notwithstanding the foregoing, if any Security shall have been authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in ‎Section 309, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture.

 

Section 304.       Temporary Securities.

 

Pending the preparation of definitive Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities substantially of the tenor of the definitive Securities in lieu of which they are issued, which temporary Securities may be printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such temporary Securities may determine, as evidenced by their execution of such temporary Securities.

 

If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay.  After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder.  Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor one or more definitive Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor.  Until so exchanged, the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series and tenor.

 

  

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Section 305.       Registration, Registration of Transfer and Exchange.

 

The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office and in any other office or agency of the Company in a Place of Payment being herein sometimes collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as the Company or the Trustee may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities.  The Trustee is hereby appointed “Security Registrar” for the purpose of registering Securities and transfers of Securities as herein provided.

 

Upon surrender for registration of transfer of any Security of any series at the office or agency in a Place of Payment for that series, the Company shall execute and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor.

 

At the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor upon surrender of the Securities to be exchanged at a Place of Payment for the applicable series.  Whenever any Securities are so surrendered for exchange, the Company shall execute and the Trustee shall authenticate and deliver, in the name of the Holder, the Securities which the Holder making the exchange is entitled to receive.

 

All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

 

Every Security presented or surrendered for registration of transfer, exchange, redemption or payment shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar and duly executed by the Holder thereof or his attorney duly authorized in writing.

 

No service charge shall be made for any registration of transfer or exchange of Securities, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to ‎Section 304, ‎906 or ‎1107 not involving any transfer.

 

  

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Unless otherwise required by the rules of any stock exchange on which the Securities are listed or of any quotation system through which the Securities are traded, neither the Company nor the Trustee shall be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 calendar days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under ‎Section 1103 and ending at the close of business on the calendar day of such mailing, or (ii) to register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.

 

Notwithstanding any other provision in this Indenture, no Global Security may be transferred to, or registered or exchanged for Securities registered in the name of, any Person other than the Depositary for such Global Security or any nominee thereof, and no such transfer may be registered, unless (1) such Depositary (A) notifies the Company and the Trustee that it is unwilling or unable to continue as Depositary for such Global Security or (B) ceases to be a clearing agency registered under the Exchange Act, (2) the Company executes and delivers to the Trustee a Company Order that such Global Security shall be so transferable, registrable and exchangeable, and such transfers shall be registrable, (3) there shall have occurred and be continuing an Event of Default with respect to the Securities evidenced by such Global Security or (4) there shall exist such other circumstances, if any, as have been specified for this purpose in accordance with ‎Section 301.  Notwithstanding any other provision in this Indenture, a Global Security to which the restriction set forth in the immediately preceding sentence shall have ceased to apply may be transferred only to, and may be registered and exchanged for Securities registered only in the name or names of, such Person or Persons as the Depositary for such Global Security shall have directed, and no transfer thereof other than such a transfer may be registered.

 

Every Security authenticated and delivered upon registration of transfer of, or in exchange for or in lieu of, a Global Security to which the restriction set forth in the first sentence of the immediately preceding paragraph shall apply, whether pursuant to this Section, ‎Section 304, ‎306, ‎906 or ‎1107 or otherwise, shall be authenticated and delivered in the form of, and shall be, a Global Security.

 

Section 306.       Mutilated, Destroyed, Lost and Stolen Securities.

 

If there shall be delivered to the Company and the Trustee (i) a mutilated Security, or (ii) evidence to the Company’s and the Trustee’s satisfaction of the destruction, loss or theft of any Security and in either case such security or indemnity as may be required by the Company and/or the Trustee to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide 

 

  

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purchaser, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such mutilated, destroyed, lost or stolen Security, a new Security of the same series and of like principal amount and tenor.

 

In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

 

Upon the issuance of any new Security under this ‎Section 306, the Company or the Trustee may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including without limitation the fees and expenses of the Trustee) connected therewith.

 

Every new Security of any series issued pursuant to this ‎Section 306 in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of the applicable series duly issued hereunder.

 

The provisions of this ‎Section 306 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

 

Section 307.       Payment of Interest; Interest Rights Preserved.

 

Except as otherwise provided in accordance with ‎Section 301 with respect to any series of Securities, interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest.

 

Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in Clause ‎(1) or ‎(2) below:

 

(1)       The Company may make payment of any Defaulted Interest to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such 

 

  

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Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment (which date shall permit compliance with the remainder of this Clause ‎(1)), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Clause ‎(1) provided.  Promptly after the Trustee’s receipt of the notice of the proposed payment, the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 calendar days and not less than 10 calendar days prior to the date of the proposed payment and not less than 15 calendar days after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Securities of the applicable series at such Holder’s address as it appears in the Security Register, not less than 10 calendar days prior to such Special Record Date.  Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of the applicable series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following Clause ‎(2).

 

(2)       The Company may make payment of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this Clause ‎(2), such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of 

 

  

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any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

 

Section 308.       Persons Deemed Owners.

 

Prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and any premium and (subject to ‎Section 307) any interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

 

No holder of any beneficial interest in any Global Security held on such holder’s behalf by a Depositary shall have any rights under this Indenture with respect to such Global Security, and such Depositary may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall impair, as between a Depositary and such holders of beneficial interests, the operation of customary practices governing the exercise of the rights of the Depositary as Holder of any Security.

 

Section 309.       Cancellation.

 

All Securities surrendered for payment, redemption, registration of transfer or exchange or for credit against any sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly canceled by it.  The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities previously authenticated hereunder which the Company has not issued and sold, and all Securities so delivered shall be promptly cancelled by the Trustee.  No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this ‎Section 309, except as expressly permitted by this Indenture.  All cancelled Securities held by the Trustee shall be disposed of as directed by a Company Order.  Acquisition by the Company of any Security shall not operate as a redemption or satisfaction of the indebtedness represented by such Security unless and until the same is delivered to the Trustee for cancellation.

 

  

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Section 310.       Computation of Interest.

 

Except as otherwise specified as contemplated by ‎Section 301 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months and, for any period shorter than a full monthly period, shall be computed on the basis of the actual number of calendar days elapsed in such period.

 

 

ARTICLE FOUR

 

Satisfaction and Discharge

 

Section 401.       Satisfaction and Discharge of Indenture.

 

This Indenture shall upon Company Request cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities of a series herein expressly provided for) with respect to Securities of any series and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to a series, when

 

(1)       either

 

(A)           all Securities of such series theretofore authenticated and delivered (other than (i) Securities of such series which have been destroyed, lost or stolen and which have been replaced or paid as provided in ‎Section 306 and (ii) Securities of such series for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in ‎Section 1003) have been delivered to the Trustee for cancellation; or

 

(B)           all Securities of such series not theretofore delivered to the Trustee for cancellation

 

 (i)      have become due and payable, or

 

 (ii)      will become due and payable at their Stated Maturity within one year, or

 

 (iii)     are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of

 

  

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notice of redemption by the Trustee in the name, and at the expense, of the Company,

 

and the Company has deposited or caused to be deposited with the Trustee in trust for the purpose (1) money (either in United States dollars or such other currency or currency unit in which the Securities of any series may be payable) in an amount, or (2) U.S. Government Obligations (or Foreign Government Obligations if the Securities are denominated in a foreign currency or currencies) that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one calendar day before the due date of any payment, money in an amount, or (3) a combination thereof, sufficient to pay and discharge the entire indebtedness on all Securities of such series not theretofore delivered to the Trustee for cancellation, for principal of (and premium, if any) and interest to the date of such deposit (in the case of Securities of such series which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;

 

(2)       the Company has paid or caused to be paid all other sums payable hereunder by the Company; and

 

(3)       the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture with respect to such series have been complied with.

 

If there are Securities of two or more series outstanding hereunder, the Trustee shall be required to execute an instrument acknowledging satisfaction and discharge of this Indenture only if requested to do so with respect to Securities of a particular series as to which it is Trustee and if the other conditions thereto are met.  If there are two or more Trustees hereunder, then the effectiveness of any such instrument shall be conditioned upon receipt of such instruments from all Trustees hereunder.

 

Notwithstanding the satisfaction and discharge of this Indenture with respect to a particular series, the obligations of the Company to the Trustee under ‎Section 607, the obligations of the Trustee to any Authenticating Agent under ‎Section 614 and, if money shall have been deposited with the Trustee pursuant to subclause ‎(B) of Clause ‎(1) of this ‎Section 401, the obligations of the Trustee under ‎Section 402 and the last paragraph of ‎Section 1003 shall survive until there are no Securities Outstanding with respect to a particular series and the

 

  

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obligations of the Company and the Trustee with respect to all other series of Securities shall survive.

 

Section 402.       Application of Trust Fund.

 

Subject to the provisions of the last paragraph of ‎Section 1003, all amounts deposited with the Trustee pursuant to ‎Section 401 shall be held in trust and applied by the Trustee, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and any premium and interest for whose payment such funds have been deposited with the Trustee.

 

 

ARTICLE FIVE

 

Remedies

 

Section 501.       Events of Default.

 

“Event of Default” whenever used with respect to Securities of a series means any one of the following events and such other events as may be established with respect to the Securities of such series pursuant to ‎Section 301 hereof:

 

(1)       Default in the payment of any instalment of interest on any of the Securities of such series as and when the same shall become due and payable, and continuance of such default for a period of 30 calendar days; or

 

(2)       Default in the payment of the principal of or premium, if any, on any of the Securities of such series as and when the same shall become due and payable either at maturity, upon redemption, by declaration or otherwise; or

 

(3)       Default in the making of any sinking fund payment, whether mandatory or optional, as and when the same shall become due and payable by the terms of the Securities of such series; or

 

(4)       Failure on the part of the Company duly to observe or perform in any material respect any of the other covenants or agreements on the part of the Company contained in this Indenture (other than those set forth exclusively in the terms of any other particular series of Securities established as contemplated by this 

 

  

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Indenture for the benefit of such other series) and written notice of such failure, stating that such notice is a “Notice of Default” hereunder, and requiring the Company to remedy the same, shall have been given by registered or certified mail, return receipt requested, to the Company by the Trustee, or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of that series, and such failure shall have continued unremedied for a period of 90 calendar days after the date of the Company’s receipt of such Notice of Default; or

 

(5)       An event of default, as defined in any indenture or instrument evidencing or under which the Company or any Principal Subsidiary shall have outstanding indebtedness for borrowed money in a principal amount in excess of $100,000,000, shall occur and be continuing, and such indebtedness shall have been accelerated so that the same shall be or become due and payable prior to the date on which the same would otherwise have become due and payable (other than acceleration of Non-Recourse Debt which does not exceed in the aggregate 4% of the Company’s total shareholders’ equity as set forth in the most recently published audited consolidated balance sheet of the Company) or the Company or any Principal Subsidiary shall default in the payment at final maturity of outstanding indebtedness for borrowed money in a principal amount in excess of $100,000,000 (other than default in payment at final maturity of Non-Recourse Debt which does not exceed in the aggregate 4% of the Company’s total shareholders’ equity as set forth in the most recently published audited consolidated balance sheet of the Company), and such acceleration or default at maturity shall not be waived, rescinded or annulled within 30 calendar days after written notice thereof, stating that such notice is a “Notice of Default” hereunder, shall have been given to the Company by the Trustee (if such event be known to it), or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of that series; provided, however, that if such acceleration under such indenture or instrument or default at maturity shall be remedied or cured by the Company or Principal Subsidiary, or waived, rescinded or annulled by the requisite holders of such indebtedness, then the Event of Default hereunder by reason thereof shall be deemed likewise to have been thereupon remedied, cured, waived, rescinded or annulled without further action upon the part of either the Trustee or any of the Holders; and provided further, that, subject to the provisions of Sections ‎601 

 

  

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and ‎602, the Trustee shall not be charged with knowledge of any such default unless written notice thereof shall have been given to the Trustee by the Company, by the holder of any such indebtedness or an agent of the holder of any such indebtedness, by the trustee then acting under any such indenture or other instrument under which such default shall have occurred, or by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of that series; or

 

(6)       A decree or order by a court of competent jurisdiction shall have been entered adjudging the Company bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of the Company under any applicable Federal or State bankruptcy or similar law, and such decree or order shall have continued undischarged and unstayed for a period of 90 calendar days; or a decree or order of a court of competent jurisdiction for the appointment of a receiver, liquidator, trustee, assignee, sequestrator or similar official in bankruptcy or insolvency of the Company or of all or substantially all of the Company’s property, or for the winding up or liquidation of the Company’s affairs, shall have been entered, and such decree or order shall have continued undischarged and unstayed for a period of 90 calendar days; or

 

(7)       The Company shall institute proceedings to be adjudicated a voluntary bankrupt, or shall consent to the filing of a bankruptcy proceeding against it, or shall file a petition or answer or consent seeking reorganization, arrangement, adjustment or composition under any applicable Federal or State bankruptcy or similar law, or shall consent to the filing of any such petition, or shall consent to the appointment of a receiver, liquidator, trustee, assignee, sequestrator or similar official in bankruptcy or insolvency of the Company or of all or substantially all of the Company’s property, or shall make an assignment for the benefit of creditors, or the Company shall admit in writing its inability to pay its debts generally as they become due and its willingness to be adjudged a bankrupt, or corporate action shall be taken by the Company in furtherance of any of the aforesaid purposes.

 

Upon receipt by the Trustee of any Notice of Default pursuant to this ‎Section 501 with respect to Securities of any series, a record date shall automatically and without any other action by any Person be set for the purpose of determining the Holders of Outstanding Securities of such series entitled to join in such Notice of Default, which record date shall be the close of business on the day 

 

  

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the Trustee receives such Notice of Default.  Only the Holders of Outstanding Securities of such series on such record date (or their duly appointed agents) shall be entitled to join in such Notice of Default, whether or not such Holders remain Holders after such record date; provided that, unless such Notice of Default shall have become effective by virtue of Holders of at least 25% in principal amount of Outstanding Securities of such series on such record date (or their duly appointed agents) having joined therein on or prior to the 90th calendar day after such record date, such Notice of Default automatically and without any action by any Person shall be cancelled and of no further effect.  Nothing in this paragraph shall prevent a Holder (or a duly appointed agent thereof) from giving, before or after the expiration of such 90 calendar day period, a Notice of Default contrary to or different from, or, after the expiration of such period, identical to, a Notice of Default that has been cancelled pursuant to the proviso to the preceding sentence, in which event a new record date in respect thereof shall be set pursuant to this paragraph.

 

Section 502.       Acceleration of Maturity; Rescission and Annulment.

 

If an Event of Default with respect to Securities of any series at the time Outstanding occurs and is continuing, then in every such case the Trustee or the Holders of not less than 25% in principal amount of the Outstanding Securities of that series may declare the principal amount (or, if any of the Securities of that series are Original Issue Discount Securities, such portion of the principal amount of such Securities as may be specified in the terms thereof) of all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) and all accrued interest thereon shall become immediately due and payable.

 

At any time after such a declaration of acceleration with respect to Securities of any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this ‎Article Five provided, the Holders of a majority in principal amount of the Outstanding Securities of that series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if:

 

(1)       the Company has paid or deposited with the Trustee a sum sufficient to pay

 

(A)           all overdue interest on all Securities of that series,

 

(B)           the principal of (and premium, if any, on) any Securities of that series which have become due otherwise

 

  

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than by such declaration of acceleration and any interest thereon at the rate or rates prescribed therefor in such Securities,

 

(C)           to the extent that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Securities, and

 

(D)           all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, except such costs and expenses as are a result of negligence or bad faith on the part of the Trustee;

 

and

 

(2)       all Events of Default with respect to Securities of that series, other than the non-payment of the principal of and interest, if any, on the Securities of that series which have become due solely by such declaration of acceleration, have been cured or waived as provided in ‎Section 513.

 

No such rescission shall affect any subsequent default or impair any right arising out of any subsequent default.

 

Upon receipt by the Trustee of any declaration of acceleration, or any rescission and annulment of any such declaration, pursuant to this ‎Section 502 with respect to Securities of any series, a record date shall be set, automatically and without any other action by any Person, for the purpose of determining the Holders of Outstanding Securities of such series entitled to join in such declaration, or rescission and annulment, as the case may be, which record date shall be the close of business on the day the Trustee receives such declaration, or rescission and annulment, as the case may be.  Only the Holders of Outstanding Securities of such series on such record date (or their duly appointed agents) shall be entitled to join in such declaration, or rescission and annulment, as the case may be, whether or not such Holders remain Holders after such record date; provided that, unless such declaration, or rescission and annulment, as the case may be, shall have become effective by virtue of Holders of at least 25%, in the case of any declaration of acceleration, or a majority, in the case of any rescission or annulment, in principal amount of Outstanding Securities of such series on such record date (or their duly appointed agents) having joined therein on or prior to the 90th calendar day after such record date, such declaration, or rescission and annulment, as the case may be, automatically and without any action by any Person shall be cancelled and of no further effect.  Nothing in this paragraph shall 

 

  

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prevent a Holder (or a duly appointed agent thereof) from giving, before or after the expiration of such 90 calendar day period, a declaration of acceleration, or a rescission and annulment of any such declaration, contrary to or different from, or, after the expiration of such period, identical to, a declaration, or rescission and annulment, as the case may be, that has been cancelled pursuant to the proviso to the preceding sentence, in which event a new record date in respect thereof shall be set pursuant to this paragraph.

 

Section 503.       Collection of Indebtedness and Suits for Enforcement by Trustee.

 

The Company covenants that if

 

(1)       default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 calendar days, or

 

(2)       default is made in the payment of  the principal of (or premium, if any, on) any Security at the Maturity thereof,

 

the Company will, upon written demand of the Trustee, pay to the Trustee, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and any premium and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and premium and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, 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, except such costs and expenses as are a result of negligence or bad faith on the part of the Trustee.  Until such demand is made by the Trustee, the Company may pay the principal of and premium, if any, and interest, if any, on the Securities of any series to the Holders thereof, whether or not the Securities of such series are overdue.

 

If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

 

  

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If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture, in aid of the exercise of any power granted herein or to enforce any other proper remedy.

 

Section 504.       Trustee May File Proofs of Claim.

 

In case of any judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or such other obligor or their creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such proceeding.  In particular, the Trustee shall be authorized

 

(i)          to file and prove a claim for the whole amount of principal (and premium, if any) and interest owing and unpaid in respect of the Securities in accordance with the terms thereof and to file such 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 of the Holders allowed in such judicial proceeding, and

 

(ii)          to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, if the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to the Trustee for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under ‎Section 607, except such costs and expenses as are a result of negligence or bad faith on the part of the Trustee.

 

No provision of this Indenture 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 Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding; provided, however, that the Trustee may, on behalf of the Holders, vote for the election of a trustee in 

 

  

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bankruptcy or similar official and be a member of a creditors’ or other similar committee.

 

Section 505.       Trustee May Enforce Claims Without Possession of Securities.

 

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, except such costs and expenses as are a result of negligence or bad faith on the part of the Trustee, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

Section 506.       Application of Money Collected.

 

Any money collected by the Trustee pursuant to this ‎Article Five shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or any premium or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

 

FIRST:  To the payment of all amounts due the Trustee under ‎Section 607;

 

SECOND:  To the payment of the amounts then due and unpaid for principal of and any premium and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and any premium  and interest, respectively; and

 

THIRD:  To the payment of the remainder, if any, to the Company or any other Person lawfully entitled thereto.

 

Section 507.       Limitation on Suits.

 

No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless

 

  

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(1)       such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series;

 

(2)       the Holders of not less than 25% in principal amount of the Outstanding Securities of that series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in the Trustee’s own name as Trustee hereunder;

 

(3)       such Holder or Holders have offered to the Trustee indemnity reasonably satisfactory in form and substance to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request;

 

(4)       the Trustee for 60 calendar days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

 

(5)       no direction inconsistent with such written request has been given to the Trustee during such 60 calendar day period by the Holders of a majority in principal amount of the Outstanding Securities of that series;

 

it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing itself or themselves of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all of such Holders.

 

Section 508.       Unconditional Right of Holders to Receive Principal, Premium and Interest.

 

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and any premium and (subject to ‎Section 307) any interest on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

 

  

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Section 509.       Restoration of Rights and Remedies.

 

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

Section 510.       Rights and Remedies Cumulative.

 

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of ‎Section 306, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

Section 511.       Delay or Omission Not Waiver.

 

No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Subject to ‎Section 507, every right and remedy given by this ‎Article Five or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 512.       Control by Holders.

 

The Holders of a majority in principal amount of the Outstanding Securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such series, provided that

 

(1)       such direction shall not be in conflict with any rule of law or with this Indenture, and

 

  

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(2)       the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

 

Upon receipt by the Trustee of any such direction with respect to Securities of any series, a record date shall be set for determining the Holders of Outstanding Securities of such series entitled to join in such direction, which record date shall be the close of business on the day the Trustee receives such direction.  Only the Holders of Outstanding Securities of such series on such record date (or their duly appointed agents) shall be entitled to join in such direction, whether or not such Holders remain Holders after such record date; provided that, unless such direction shall have become effective by virtue of Holders of at least a majority in principal amount of Outstanding Securities of such series on such record date (or their duly appointed agents) having joined therein on or prior to the 90th calendar day after such record date, such direction automatically and without any action by any Person shall be cancelled and of no further effect.  Nothing in this paragraph shall prevent a Holder (or a duly appointed agent thereof) from giving, before or after the expiration of such 90 calendar day period, a direction contrary to or different from, or, after the expiration of such period, identical to, a direction that has been cancelled pursuant to the proviso to the preceding sentence, in which event a new record date in respect thereof shall be set pursuant to this paragraph.

 

Section 513.       Waiver of Past Defaults.

 

The Holders of not less than a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Securities of such series waive any past default hereunder with respect to such series and its consequences, except a default

 

(1)       in the payment of the principal of or any premium or interest on any Security of such series, or

 

(2)       in respect of a covenant or provision hereof which under ‎Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security of such series that would be affected by such waiver.

 

With respect to any series of Securities, the Company may, but shall not be obligated to, establish a record date for the purpose of determining the Persons entitled to waive any past default hereunder.  If a record date is fixed, only the Holders of Outstanding Securities of such series on such record date (or their duly appointed agents) shall be entitled to waive any default hereunder, whether or not such Holders remain Holders after such record date; provided, that, unless the Holders of not less than a majority in principal amount of the Outstanding 

 

  

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Securities of such series on such record date (or their duly appointed agents) shall have waived such default on or prior to the 90th calendar day after such record date, any such waiver previously given automatically and without further action by any Holder shall be cancelled and of no effect.

 

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 514.       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, suffered or omitted by the Trustee as Trustee, a court may require any party litigant in such suit to file an undertaking to pay the costs of such suit, and may assess costs against any such party litigant, in the manner and to the extent provided in the Trust Indenture Act; provided that neither this ‎Section 514 nor the Trust Indenture Act shall be deemed to authorize any court to require such an undertaking or to make such an assessment in any suit instituted by the Company.

 

 

ARTICLE SIX

 

The Trustee

 

Section 601.       Certain Duties and Responsibilities.

 

The duties and responsibilities of the Trustee shall be as provided by the Trust Indenture Act.  Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.  Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this ‎Section 601.

 

Section 602.       Notice of Defaults.

 

If a default occurs hereunder with respect to Securities of any series, the Trustee shall give the Holders of Securities of such series notice of such default as and to the extent provided by the Trust Indenture Act; provided, however, that in 

 

  

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the case of any default of the character specified in ‎Section 501(4) with respect to Securities of such series, no such notice to Holders shall be given until at least 30 calendar days after the occurrence thereof.  For the purpose of this ‎Section 602, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Securities of such series.

 

Section 603.       Certain Rights of Trustee.

 

Subject to the provisions of ‎Section 601:

 

(a)  the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

(b)  any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors of the Company may be sufficiently evidenced by a Board Resolution;

 

(c)  whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers’ Certificate;

 

(d)  the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

 

(e)  the Trustee shall 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 pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory in form and substance to the Trustee against the costs, expenses and liabilities which might be incurred by the Trustee in compliance with such request or direction;

 

  

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(f)  prior to the occurrence of an Event of Default and after the remedy or waiver of all Events of Default, 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 such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall upon reasonable notice to the Company be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at a time and place acceptable to the Company; and

 

(g)  the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys, and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.

 

Section 604.       Not Responsible for Recitals or Issuance of Securities.

 

The recitals contained herein and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility for their correctness.  The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.  The Trustee or any Authenticating Agent shall not be accountable for the use or application by the Company of Securities or the proceeds thereof.

 

Section 605.       May Hold Securities.

 

The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections ‎608 and ‎613, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar or other agent of the Company.

 

Section 606.       Money Held in Trust.

 

Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law.  The Trustee shall be under no 

 

  

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liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company.

 

Section 607.       Compensation and Reimbursement.

 

The Company agrees

 

(1)       to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

 

(2)       except as otherwise expressly provided herein, to reimburse the Trustee upon its written request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation, and reasonable expenses and disbursements of its agents and outside counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and

 

(3)       to indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder.

 

Section 608.       Disqualification; Conflicting Interests.

 

If the Trustee has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture.

 

Section 609.       Corporate Trustee Required; Eligibility.

 

There shall at all times be a Trustee hereunder which shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000 or is a subsidiary of a corporation which shall be a Person that has a combined capital and surplus of at least $50,000,000 and which unconditionally guarantees the obligations of the Trustee hereunder.  If such Person publishes reports of condition at least annually, 

 

  

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pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this ‎Section 609, the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time the Trustee shall cease to be eligible in accordance with the provisions of this ‎Section 609, it shall resign immediately in the manner and with the effect hereinafter specified in this ‎Article Six.

 

Section 610.       Resignation and Removal; Appointment of Successor.

 

(a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this ‎Article Six shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of ‎Section 611.

 

(b)  The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company.  If the instrument of acceptance by a successor Trustee required by ‎Section 611 shall not have been delivered to the Trustee within 30 calendar days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

(c)  The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Trustee and to the Company.

 

(d) If at any time:

 

(1)          the Trustee shall fail to comply with ‎Section 608 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least 180 consecutive calendar days, or

 

(2)          the Trustee shall cease to be eligible under ‎Section 609 and shall fail to resign after written request therefor by the Company or by any Holder of a Security for at least 180 consecutive calendar days, or

 

(3)          the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

 

  

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then, in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Securities, or (ii) subject to ‎Section 514, any Holder who has been a bona fide Holder of a Security for at least 180 consecutive calendar days may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment of a successor Trustee or Trustees.

 

(e)  If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any reason, with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series) and shall comply with the applicable requirements of ‎Section 611.  If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with the applicable requirements of ‎Section 611, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company.  If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by ‎Section 611, any Holder who has been a bona fide Holder of a Security of such series for at least 180 consecutive calendar days may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

 

(f)  The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series to all Holders of Securities of such series in the manner provided in ‎Section 106.  Each notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office.

 

Section 611.       Acceptance of Appointment by Successor.

 

(a)           If a successor Trustee is appointed hereunder with respect to all Securities, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting 

 

  

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such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers, trusts and duties of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.

 

(b)           If a successor Trustee is appointed hereunder with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor Trustee with respect to the Securities of such series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein, and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of such successor Trustee relates.

 

(c)           Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers, trusts and duties referred to in paragraphs ‎(a) and ‎(b) of this ‎Section 611, as the case may be.

 

  

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(d)           No successor shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this ‎Article Six.

 

Section 612.       Merger, Conversion, Consolidation or Succession to Business.

 

Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this ‎Article Six, without the execution or filing of any paper or any further act on the part of any of the parties hereto.  In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

 

Section 613.       Preferential Collection of Claims Against Company.

 

If and when the Trustee shall be or become a creditor of the Company or any other obligor upon the Securities, the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company or any such other obligor.

 

Section 614.       Appointment of Authenticating Agent.

 

The Trustee may with the consent of the Company appoint an Authenticating Agent or Agents with respect to one or more series of Securities which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series issued upon original issue and upon exchange, registration of transfer or partial redemption thereof or pursuant to ‎Section 306, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and binding for all purposes as if authenticated by the Trustee hereunder.  Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent.  Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to act as 

 

  

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Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by Federal or State authority.  If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this ‎Section 614, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this ‎Section 614, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this ‎Section 614.

 

Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to all or substantially all of the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise eligible under this ‎Section 614, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

 

An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company.  The Trustee or the Company may at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company or the Trustee, as the case may be.  Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this ‎Section 614, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, as their names and addresses appear in the Security Register.  Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be appointed unless eligible under the provisions of this ‎Section 614.

 

The Trustee agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this ‎Section 614, and the Trustee shall be entitled to be reimbursed for such payments, subject to the provisions of ‎Section 607.

 

If an appointment with respect to one or more series is made pursuant to this ‎Section 614, the Securities of such series may have endorsed thereon, in 

 

  

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addition to the Trustee’s certificate of authentication, an alternative certificate of authentication in the following form:

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

........................................,

As Trustee

 

By....................................,

  As Authenticating Agent

 

By.....................................,

Authorized Officer

 

 

ARTICLE SEVEN

 

Holders’ Lists and Reports by Trustee and Company

 

Section 701.       Company to Furnish Trustee Names and Addresses of Holders.

 

The Company will furnish or cause to be furnished to the Trustee

 

(a) semi-annually, not later than 10 calendar days after each Regular Record Date in each year, a list for each series of Securities, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of Securities of such series as of the preceding Regular Record Date, and

 

(b) at such other times as the Trustee may request in writing, within 30 calendar days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 calendar days prior to the time such list is furnished;

 

excluding from any such list names and addresses received by the Trustee in its capacity as Security Registrar.

 

  

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Section 702.       Preservation of Information; Communications to Holders.

 

(a) The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in ‎Section 701 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar.  The Trustee may destroy any list furnished to it as provided in ‎Section 701 upon receipt of a new list so furnished.

 

(b) The rights of the Holders to communicate with other Holders with respect to their rights under this Indenture or under the Securities, and the corresponding rights and privileges of the Trustee, shall be as provided by the Trust Indenture Act.

 

(c) Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that none of the Company, the Trustee or any agent of either of them shall be held accountable by reason of any disclosure of information as to names and addresses of Holders made pursuant to the Trust Indenture Act.

 

Section 703.       Reports by the Trustee.

 

(a) The Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto.  To the extent that any such report is required by the Trust Indenture Act with respect to any 12 month period, such report shall cover the 12 month period ending July 15 and shall be transmitted by the next succeeding September 15.

 

(b) A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which any Securities are listed, with the Commission and with the Company.  The Company will notify the Trustee when any Securities are listed on any stock exchange.

 

Section 704.       Reports by the Company.

 

The Company shall file with the Trustee and the Commission, and transmit to Holders, such information, documents and other reports, and such summaries thereof, as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to the Trust Indenture Act; provided that any such information, documents or reports required to be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within 15 calendar days after the same are so required to be filed with the Commission.

 

  

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ARTICLE EIGHT

 

Consolidation, Merger, or Sale of Assets

 

Section 801.       The Company May Consolidate, Etc., Only on Certain Terms.

 

The Company shall not consolidate with or merge with or into any other Person (other than in a merger or consolidation in which the Company is the surviving Person) or sell its properties and assets as, or substantially as, an entirety to any Person unless:

 

(1)       the Person formed by such consolidation or with or into which the Company is merged or the Person that purchases the properties and assets of the Company as, or substantially as, an entirety shall be a corporation, partnership or trust, shall be organized and validly existing under the laws of the United States of America, any State thereof or the District of Columbia and shall expressly assume the due and punctual payment of the principal of and any premium and interest on all the Securities and the performance or observance of every covenant of this Indenture on the part of the Company to be performed or observed, by supplemental indenture reasonably satisfactory in form to the Trustee, executed and delivered to the Trustee;

 

(2)       immediately after giving effect to such transaction, no Event of Default shall have occurred and be continuing; and

 

(3)       the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, or sale and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with this ‎Article Eight and that all conditions precedent herein provided for relating to such transaction have been complied with.

 

Section 802.       Successor Substituted.

 

Upon any consolidation of the Company with or merger of the Company with or into any other Person or any sale of the properties and assets of the Company as, or substantially as, an entirety in accordance with ‎Section 801, the successor Person formed by such consolidation or with or into which the Company is merged or to which such sale is made shall succeed to, and be 

 

  

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substituted for, and may exercise every right and power of the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and thereafter the predecessor Person (including the Company) shall be relieved of all obligations and covenants under this Indenture and the Securities.

 

 

ARTICLE NINE

 

Supplemental Indentures

 

Section 901.       Supplemental Indentures Without Consent of Holders.

 

Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes:

 

(1)       to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein and in the Securities; or

 

(2)       to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company; or

 

(3)       to add any additional Events of Default; or

 

(4)       to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or

 

(5)       to add to, change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change or elimination (i) shall neither (A) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (B) modify the rights of the Holder of 

 

  

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any such Security with respect to such provision or (ii) shall become effective only when there is no such Security Outstanding; or

 

(6)       to secure the Securities pursuant to the requirements of ‎Section 1005, or to otherwise secure the Securities of any series; or

 

(7)       to establish the form or terms of Securities of any series as permitted by Sections ‎201 and ‎301; or

 

(8)       to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of ‎Section 611(b); or

 

(9)       to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture, provided that such action pursuant to this clause ‎(9) shall not adversely affect the interests of the Holders of Securities of any series affected by such supplemental indenture in any material respect; or

 

(10)     to conform to any mandatory provisions of law.

 

Section 902.       Supplemental Indentures with Consent of Holders.

 

With the consent of the Holders of not less than a majority of principal amount of the Outstanding Securities of each series affected by such supplemental indenture, by Act of said Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into one or more indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Security affected thereby,

 

(1)       change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce 

 

  

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the principal amount thereof or the rate of interest thereon (including any change in the Floating or Adjustable Rate Provision pursuant to which such rate is determined that would reduce such rate for any period) or any premium payable upon the redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to ‎Section 502, or change any Place of Payment where, or the coin or currency in which, any Security or any premium or interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date), or

 

(2)       reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in this Indenture, or

 

(3)       modify any of the provisions of this ‎Section 902, ‎Section 513 or ‎Section 907, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Security affected thereby, provided, however, that this clause ‎(3) shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes in this ‎Section 902 and ‎Section 907, or the deletion of this proviso, in accordance with the requirements of Sections ‎611(b) and ‎901(8).

 

A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series.

 

It shall not be necessary for any Act of Holders under this ‎Section 902 to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.

 

  

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Section 903.       Execution of Supplemental Indentures.

 

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this ‎Article Nine or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to ‎Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture.  The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.

 

Section 904.       Effect of Supplemental Indentures.

 

Upon the execution of any supplemental indenture under this ‎Article Nine, this Indenture shall be modified in accordance therewith, such supplemental indenture shall form a part of this Indenture for all purposes, and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

 

Section 905.       Conformity with Trust Indenture Act.

 

Every supplemental indenture executed pursuant to this ‎Article Nine shall conform to the requirements of the Trust Indenture Act.

 

Section 906.       Reference in Securities to Supplemental Indentures.

 

Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this ‎Article Nine may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture.  If the Company shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company, and such Securities may be authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series.

 

Section 907.       Waiver of Compliance by Holders.

 

Anything in this Indenture to the contrary notwithstanding, any of the acts which the Company is required to do, or is prohibited from doing, by any of the provisions of this Indenture may, to the extent that such provisions might be changed or eliminated by a supplemental indenture pursuant to ‎Section 902 upon consent of  Holders of not less than a majority in aggregate principal amount of the then Outstanding Securities of the series affected, be omitted or done by the 

 

  

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Company if there is obtained the prior consent or waiver of the Holders of at least a majority in aggregate principal amount of the then Outstanding Securities of such series.

 

 

ARTICLE TEN

 

Covenants

 

Section 1001.     Payment of Principal, Premium and Interest.

 

The Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay or cause to be paid the principal of and any premium and interest on the Securities of that series in accordance with the terms of the Securities and this Indenture.

 

Section 1002.     Maintenance of Office or Agency by the Company.

 

(a)           So long as any Securities are Outstanding, the Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served.  The Company 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 Company shall fail to maintain any such required office or agency or shall fail 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, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.

 

(b)           The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series 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 shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes.  The Company 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.

 

  

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Section 1003.     Money for Securities Payments to be Held in Trust.

 

If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date of the principal of or any premium or interest on any of the Securities of that series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal and any premium and interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

 

Whenever the Company shall have one or more third party Paying Agents for any series of Securities, it will, before each due date of the principal of or any premium or interest on any Securities of that series, deposit with a Paying Agent a sum sufficient to pay the principal and any premium and interest so becoming due, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.

 

The Company will cause each Paying Agent for any series of Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this ‎Section 1003, that such Paying Agent will (i) comply with the provisions of the Trust Indenture Act applicable to it as a Paying Agent and (ii) during the continuance of any default by the Company (or any other obligor upon the Securities of that series) in the making of any payment in respect of the Securities of that series, and upon the written request of the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying Agent for payment in respect of the Securities of that series.

 

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Any money deposited with the Trustee or any third party Paying Agent, or then held by the Company, in trust for the payment of the principal of or any premium or interest on any Security of any series and remaining unclaimed on the second anniversary of the date on which such principal, premium or interest has become due and payable shall be paid to the Company on Company Request, or 

 

  

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(if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such third party Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in the Borough of Manhattan, the City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 calendar days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

 

Section 1004.     Statement by Officers as to Default.

 

The Company will deliver to the Trustee within 120 calendar days after the end of each fiscal year of the Company ending after the date hereof, a certificate signed by the Company’s principal executive officer, principal financial officer or principal accounting officer stating whether or not to the best knowledge of the signer thereof the Company is in compliance with all terms, conditions and covenants of this Indenture (without regard to any period of grace or requirement of notice provided hereunder) and if the signer has obtained knowledge of any continuing default by the Company in the performance, observation or fulfillment of any such term, condition or covenant, specifying each such default and the nature thereof.

 

Section 1005.     Limitations on Liens on Common Stock of Principal Subsidiaries.

 

As long as any of the Securities remains outstanding, the Company will not, and will not permit any Principal Subsidiary to, issue, assume, incur or guarantee any indebtedness for borrowed money secured by a mortgage, pledge, lien or other encumbrance, directly or indirectly, on any of the Common Stock of a Principal Subsidiary, which Common Stock is owned by the Company or by any Principal Subsidiary, unless the obligations of the Company under the Securities and, if the Company so elects, any other indebtedness of the Company ranking on a parity with or prior to the Securities, shall be secured equally and ratably with, or prior to, such secured indebtedness for borrowed money so long as such secured indebtedness is outstanding and is so secured.

 

  

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ARTICLE ELEVEN

 

Redemption of Securities

 

Section 1101.     Applicability of Article.

 

Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified in accordance with ‎Section 301 for Securities of any series) in accordance with this ‎Article Eleven.

 

Section 1102.     Election to Redeem; Notice to Trustee.

 

In case of any redemption at the election of the Company of less than all the Securities of any series, the Company shall, at least 60 calendar days prior to the Redemption Date fixed by the Company (unless a shorter notice period shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the principal amount of Securities of such series to be redeemed.  In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers’ Certificate evidencing compliance with such restriction.

 

Section 1103.     Selection by Trustee of Securities to Be Redeemed.

 

If less than all the Securities of any series are to be redeemed, the particular Securities to be redeemed shall be selected not more than 45 calendar days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series.

 

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

 

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed.

 

  

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Section 1104.     Notice of Redemption.

 

Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 calendar days prior to the Redemption Date, to each Holder of Securities to be redeemed, at its address appearing in the Security Register.

 

All notices of redemption shall state:

 

(1)       the Redemption Date,

 

(2)       the Redemption Price,

 

(3)       if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption of any Securities, the principal amounts) of the particular Securities to be redeemed,

 

(4)       that on the Redemption Date the Redemption Price will become due and payable upon each such Security to be redeemed and, if applicable, that interest thereon will cease to accrue on and after said date,

 

(5)       the place or places where such Securities are to be surrendered for payment of the Redemption Price, and

 

(6)       that the redemption is for a sinking fund, if such is the case.

 

Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company’s request, by the Trustee in the name and at the expense of the Company.

 

Section 1105.     Deposit of Redemption Price.

 

Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in ‎Section 1003) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date.

 

  

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Section 1106.     Securities Payable on Redemption Date.

 

Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Securities shall cease to bear interest.  Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided, however, that, unless otherwise specified as contemplated by ‎Section 301, if the Redemption Date is after a Record Date but on or prior to the related Interest Payment Date, the accrued interest shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Date according to their terms and the provisions of ‎Section 307.

 

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

 

Section 1107.     Securities Redeemed in Part.

 

Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series and of like tenor, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

 

 

ARTICLE TWELVE

 

Defeasance and Covenant Defeasance

 

Section 1201.     Company’s Option to Effect Defeasance or Covenant Defeasance.

 

The Company may elect, at any time, to have either ‎Section 1202 or ‎Section 1203 applied to the Outstanding Securities of any series upon compliance with the conditions set forth in this ‎Article Twelve.

 

  

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Section 1202.     Defeasance and Discharge.

 

Upon the Company’s exercise of the option provided in ‎Section 1201 to have this ‎Section 1202 applied to the Outstanding Securities of any series, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series as provided in this ‎Section 1202 on and after the date the conditions set forth in ‎Section 1204 are satisfied (hereinafter called “Defeasance”).  For this purpose, such Defeasance means that the Company shall be deemed to have paid and discharged the entire indebtedness represented by the Outstanding Securities of such series and to have satisfied all of the Company’s other obligations under the Securities of such series and this Indenture insofar as the Securities of such series are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), subject to the following which shall survive until otherwise terminated or discharged hereunder:  i) the rights of Holders of Securities of such series to receive, solely from the trust fund described in ‎Section 1204 and as more fully set forth in such Section, payments in respect of the principal of and any premium and interest on such Securities of such series when payments are due, ii) the Company’s obligations with respect to the Securities of such series under Sections ‎304, ‎305, ‎306, ‎1002 and ‎1003, iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder, including, without limitation, its rights under ‎Section 607 and iv) this ‎Article Twelve.  Subject to compliance with this ‎Article Twelve, the Company may exercise its option provided in ‎Section 1201 to have this ‎Section 1202 applied to the Outstanding Securities of any series notwithstanding the prior exercise of its option provided in ‎Section 1201 to have ‎Section 1203 applied to the Outstanding Securities of such series.

 

Section 1203.     Covenant Defeasance.

 

Upon the Company’s exercise of the option provided in ‎Section 1201 to have this ‎Section 1203 applied to the Outstanding Securities of any series, (1) the Company shall be released from its obligations under Sections ‎801 and ‎1005 and (2) the occurrence of any event specified in ‎Section 501(4) (with respect to Sections ‎801 and ‎1005) or ‎501(5) shall be deemed not to be or result in an Event of Default, in each case with respect to the Outstanding Securities of such series as provided in this ‎Section 1203 on and after the date the conditions set forth in ‎Section 1204 are satisfied (hereinafter called “Covenant Defeasance”).  For this purpose, such Covenant Defeasance means that the Company may omit to comply with (and no Event of Default shall arise out of such non-compliance) and shall have no liability in respect of any term, condition or limitation set forth in ‎Section 801 and/or ‎1005, whether directly or indirectly by reason of any reference elsewhere herein to any such Section or by reason of any reference in any such Section to any other provision herein or in any other document, but the remainder of this Indenture and the Securities of such series shall be unaffected thereby.

 

  

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Section 1204.     Conditions to Defeasance or Covenant Defeasance.

 

The following shall be the conditions to application of either ‎Section 1202 or ‎Section 1203 to the Outstanding Securities of any series:

 

(1)       The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee that satisfies the requirements contemplated by ‎Section 609 and agrees to comply with the provisions of this ‎Article Twelve applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of Outstanding Securities of such series, (A) in the case of Securities of such series denominated in U.S. dollars, (i) money in an amount, (ii) U.S. Government Obligations that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one Business Day before the due date of any payment, money in an amount, or (iii) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, the principal of and any premium and interest on the Securities of such series on the respective Stated Maturities, in accordance with the terms of this Indenture and the Securities of such series or (B) in the case of Securities of such series denominated in a currency other than the U.S. dollar, (i) money in such currency in an amount, or (ii) Foreign Government Obligations that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one Business Day before the due date of any payment, money in such currency in an amount, or (iii) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, the principal of and any premium and interest on the Securities of such series on the respective Stated Maturities, in accordance with the terms of this Indenture and the Securities of such series.  As used herein, “U.S. Government Obligation” means (x) any security that is (i) a direct obligation of the United States of America for the payment of which the full faith and credit of the United States of America is pledged or (ii) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality for the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, which, in either case (i) or (ii), is not callable or redeemable at the option of the 

  

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issuer thereof, and (y) any depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian (I) with respect to any specific payment of principal of or interest on any such U.S. Government Obligation specified in Clause (x) of this definition of U.S. Government Obligation and held by such custodian for the account of the holder of such depositary receipt, or (II) with respect to any specific payment of principal of or interest on any such U.S. Government Obligation, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal or interest evidenced by such depositary receipt.  The bank acting as Trustee, or its affiliates, may act as custodian as contemplated by this ‎Section 1204(1).  As used herein, “Foreign Government Obligation” means (x) any security that is (i) a direct obligation of the government that issued such currency for the payment of which the full faith and credit of such government is pledged or (ii) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality for such government the payment of which is unconditionally guaranteed as a full faith and credit obligation by such government, which, in either case (i) or (ii), is not callable or redeemable at the option of the issuer thereof, and (y) any depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended) as custodian (I) with respect to any specific payment of principal of or interest on any such Foreign Government Obligation specified in Clause (x) of this definition of Foreign Government Obligation and held by such custodian for the account of the holder of such depositary receipt, or (II) with respect to any specific payment of principal of or interest on any such Foreign Government Obligation, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the Foreign Government Obligation or the specific payment of principal or interest evidenced by such depositary receipt.

 

(2)       In the case of an election under ‎Section 1202, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize gain or loss for Federal income tax purposes as a result of the deposit, Defeasance and discharge to be effected with respect to the Securities of such series and will be subject to Federal income tax on the same amount, in the same manner and at the same times as would be the case if such deposit, Defeasance and discharge were not to occur.

 

  

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(3)       In the case of an election under ‎Section 1203, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize gain or loss for Federal income tax purposes as result of the deposit and Covenant Defeasance to be effected with respect to the Securities of such series and will be subject to Federal income tax on the same amount, in the same manner and at the same times as would be the case if such deposit and Covenant Defeasance were not to occur.

 

(4)       The Company shall have delivered to the Trustee an officers’ Certificate to the effect that the Securities of such series, if then listed on any securities exchange, will not be delisted as a result of such deposit.

 

(5)       No Event of Default or event that (after notice or lapse of time or both) would become an Event of Default shall have occurred and be continuing at the time of such deposit or, with regard to any Event of Default or any such event specified in Sections ‎501(6) and ‎501(7), at any time on or prior to the 90th calendar day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until after such 90th calendar day).

 

(6)       The Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent with respect to such Defeasance or Covenant Defeasance have been complied with.

 

(7)       Such Defeasance or Covenant Defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the Investment Company Act of 1940, as amended, unless such trust shall be qualified under such Act or exempt from regulation thereunder.

 

Section 1205.     Deposited Money and U.S. Government Obligations or Foreign Government Obligations to be Held in Trust; Other Miscellaneous Provisions.

 

Subject to the provisions of the last paragraph of ‎Section 1003, all money and U.S. Government Obligations or Foreign Government Obligations (including the proceeds thereof) deposited with the Trustee or other qualifying trustee (solely for purposes of this ‎Section 1205 and ‎Section 1206, the Trustee and any such other trustee are referred to collectively as the “Trustee”) pursuant to ‎Section 1204 in respect of the Securities of any series shall be held in trust and applied by the Trustee, in accordance with the provisions of the Securities of such series and this 

 

  

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Indenture, to the payment, either directly or through any such Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of Securities of such series, of all sums due and to become due on such Securities in respect of principal and any premium and interest, but money so held in trust need not be segregated from other funds except to the extent required by law.

 

The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Obligations or Foreign Government Obligations deposited pursuant to ‎Section 1204 or the principal and interest received in respect thereof other than any such tax, fee or other charge that by law is for the account of the Holders of Outstanding Securities.

 

Anything in this ‎Article Twelve to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or U.S. Government Obligations or Foreign Government Obligations held by the Trustee as provided in ‎Section 1204 with respect to Securities of any series that, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Defeasance or Covenant Defeasance with respect to the Securities of such series.

 

Section 1206.     Reinstatement.

 

If the Trustee or the Paying Agent is unable to apply any money in accordance with this ‎Article Twelve with respect to the Securities of any series by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this ‎Article Twelve with respect to Securities of such series until such time as the Trustee or Paying Agent is permitted to apply all money held in trust pursuant to ‎Section 1205 with respect to Securities of such series in accordance with this ‎Article Twelve; provided, however, that if the Company makes any payment of principal of or any premium or interest on any Security of such series following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of Securities of such series to receive such payment from the money so held in trust.

 

 

  

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ARTICLE THIRTEEN

 

Sinking Funds

 

Section 1301.      Applicability of Article.

 

The provisions of this ‎Article Thirteen shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified in accordance with ‎Section 301 for Securities of such series.

 

The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a “mandatory sinking fund payment”, and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an “optional sinking fund payment”.  If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in ‎Section 1302.  Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of the Securities of such series.

 

Section 1302.     Satisfaction of Sinking Fund Payments with Securities.

 

The Company (1) may deliver Outstanding Securities of a series (other than any previously called for redemption) and (2) may apply as a credit Securities of a series which have been acquired or redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities or otherwise, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited.  Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.

 

Section 1303.     Redemption of Securities for Sinking Fund.

 

Not less than 45 calendar days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant to

 

  

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‎Section 1302 and also will deliver to the Trustee any Securities to be so delivered.  Not less than 15 nor more than 45 calendar days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in ‎Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in ‎Section 1104.  Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections ‎1106 and ‎1107.

 

* * * *

 

This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

 

  

75

  

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first above written.

 

	
AETNA INC.

 

 

	 
	
By

	
/s/ Alfred P. Quirk, Jr.

	 
	  	
Name:

	
Alfred P. Quirk, Jr.

	 
	  	
Title:

	
Vice President, Finance and Treasurer

	 

	
[Seal]

 

Attest:

 

	
/s/ William J. Casazza

	
STATE STREET BANK AND TRUST COMPANY

 

 

	 
	
By

	  	 
	  	
Name:

	
Earl W. Dennison, Jr.

	 
	  	
Title:

	
Vice President

	 

	
[Seal]

 

Attest:

 

	  
	
Name:

	
Gerald R. Wheeler

	
Title:

	
Vice President

 

 

  

 

  

 

	
STATE OF CONNECTICUT  

	
)

	  	  
	  	
)

	
ss.:

	
Hartford

	
COUNTY OF HARTFORD

	
)

	  	  

 

 

On the 1st day of March, 2001, before me personally came ALFRED P. QUIRK, JR., to me known, who, being by me duly sworn, did depose and say that (s)he is VICE PRESIDENT, FINANCE AND TREASURER of AETNA INC., one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed her/his name thereto by like authority.

 

	  	
/s/ William C. Baskin III

	  
	  	
Notary Public

	  
	  	
William C. Baskin III

	  
	  	
My commission expires 7/31/2003

	  

 

 

 

  

 

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first above written.

 

	
AETNA INC.

 

 

	 
	
By

	  	 
	  	
Name:

	  	 
	  	
Title:

	  	 

	
[Seal]

 

Attest:

 

	  

	
STATE STREET BANK AND TRUST COMPANY

 

 

	 
	
By

	
/s/ Earl W. Dennison, Jr.

	 

	 	

    Name:   Earl W. Dennison, Jr.

	 
	 	

Title:     Vice President

	 

	
[Seal]

 

Attest:

 

	

/s/ Gerald R. Wheeler

	
Name:

	
Gerald R. Wheeler

	
Title:

	
Vice President

  

 

  

	
COMMONWEALTH OF MASSACHUSETTS  

	
)

	  
	  	
)

	
ss.:

	
COUNTY OF SUFFOLK

	
)

	  

 

On the 2nd day of March, 2001, before me personally came EARL W. DENNISON, to me known, who, being by me duly sworn, did depose and say that (s)he is VICE PRESIDENT of STATE STREET BANK AND TRUST COMPANY, one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed her/his name thereto by like authority.

 

	  	  	  
	
Aristides Juarbe

Notary Public

My Commission Expires January 10, 2008

	  	
/s/ Aristides Juarbe

	
Notary Public

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00197-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00197-of-00352.parquet"}]]