Document:

Document

Exhibit 4.2

COMSTOCK RESOURCES, INC.,
EACH OF THE SUBSIDIARY GUARANTORS PARTY HERETO
and
AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,
as Trustee  

SECOND SUPPLEMENTAL INDENTURE
dated as of March 4, 2021
to
INDENTURE
dated as of June 23, 2020

9.75% Senior Notes due 2026

THIS SUPPLEMENTAL INDENTURE dated as of March 4, 2021 (this “Supplemental Indenture”), is among COMSTOCK RESOURCES, INC., a Nevada corporation, as successor issuer (hereinafter called the “Company”), the SUBSIDIARY GUARANTORS named on the signature pages hereto and American Stock Transfer & Trust Company, LLC, as trustee (hereinafter called the “Trustee”) under the Base Indenture, dated as of June 23, 2020, among the Company, the subsidiary guarantors party thereto and the Trustee, as amended by the First Supplemental Indenture, dated as of June 23, 2020, among the Company, the subsidiary guarantors party thereto and the Trustee (together, as heretofore amended, supplemented or otherwise modified, the “Indenture”). Capitalized terms used in this Supplemental Indenture and not otherwise defined herein shall have the meanings assigned to such terms in the Indenture.

RECITALS 

WHEREAS, pursuant to the Indenture, the Company issued the 9.75% Senior Notes due 2026 (the “Notes”) of which $800,000,000 in aggregate principal amount are currently outstanding under the Indenture; 

WHEREAS, Section 10.02 of the Indenture provides that the Company, the Subsidiary Guarantors and the Trustee, with consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes and upon the request of the Company, may enter into an indenture or indentures supplemental to the Indenture for the purpose of modifying or eliminating any of the provisions of the Indenture or of modifying in any manner the rights of the Holders under the Indenture, subject to the limitations set forth therein;

WHEREAS, pursuant to a tender offer and consent solicitation, the Company has offered (the “Purchase Offer”) to purchase up to $780.0 million in aggregate principal amount of the Notes, together with the 9.75% Senior Notes due 2026 issued under the indenture dated August 3, 2018 (the “Other 2026 Notes”), as amended and supplemented, for the purchase price (including interest to the date of payment) and upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 18, 2021, for up to $1.250 billion aggregate purchase price of its outstanding Notes, the Other 2026 Notes and the 7.50% Senior Notes due 2025, as the same may be amended, supplemented or modified (the “Purchase Offer Document”);

WHEREAS, in connection with Purchase Offer, the Company solicited consents from the  holders of the Notes to amend certain provisions of the Indenture, as set forth in Article I of this Supplemental Indenture (the “Proposed Amendments”);

WHEREAS, the Company desires to make the Proposed Amendments;

WHEREAS, the Company has received and delivered to the Trustee an Act of the Holders containing the requisite consents (the “Consents”) to effect the Proposed Amendments under the Indenture; 

WHEREAS, pursuant to Section 10.02 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture;

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

WHEREAS, all acts and requirements necessary to make this Supplemental Indenture the legal, valid and binding obligation of the Company and the Subsidiary Guarantors have been done.

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

ARTICLE I
AMENDMENTS TO INDENTURE 

Section 1.01    Amendments to Articles 1, 4, 5, and 7. The Indenture is hereby amended as follows:

(a)    The following sections of the Indenture shall be deleted in their entirety and replaced with “RESERVED”: 

(i)    Section 4.08, entitled Offer to Purchase by Application of Excess Proceeds;

(ii)    Section 5.07, entitled Limitation on Restricted Payments;

(iii)    Section 5.08, entitled Limitation on Dividends and Other Payment Restrictions;

(iv)    Section 5.09, Limitation on Indebtedness and Disqualified Capital Stock; 

(v)    Section 5.10, entitled Limitation on Asset Sales;

(vi)    Section 5.11, entitled Limitation on Transactions with Affiliates; 

(vii)    Section 5.12, entitled Limitation on Liens;

(viii)    Section 5.15, entitled Offer to Repurchase Upon Change of Control;

(ix)    Section 5.16, entitled Future Designation of Restricted and Unrestricted Subsidiaries; 

(x)    Section 5.18, entitled Limitation on Issuances and Sales of Preferred Stock of Restricted Subsidiaries; and

(xi)    Sections 7.01(f) and 7.01(h), clauses (f) and (h) only of the section entitled Events of Default.
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(b)    Failure to comply with the terms of any of the foregoing Sections of the Indenture shall no longer constitute a Default or an Event of Default under the Indenture and shall no longer have any other consequence under the Indenture.  Provisions in the Indenture that authorize action by the Company or any Subsidiary Guarantor when permitted by a deleted section or which is to be done in accordance with a deleted section shall be deemed to permit such action unless prohibited by such deleted section or performed in a way consistent with such section, and, otherwise, references in the Indenture to deleted provisions shall also no longer have any effect or consequence under the Indenture.

(c)    Section 4.03 of the Indenture is hereby amended to delete the first sentence and replace it with the following:

At least three Business Days but not more than 60 days before a redemption date (except that redemption notices may be delivered or mailed more than 60 days prior to a redemption date if the notice is issued in connection with a Legal Defeasance, Covenant Defeasance or discharge), the Company shall deliver or cause to be delivered, by first class mail a notice of redemption to each Holder whose Notes are to be redeemed (with a copy to the Trustee) at its registered address (or to the extent permitted or required by applicable Depositary procedures or regulations with respect to Notes in global form, sent electronically).

Section 1.02    Definitions, References.  The Indenture is hereby amended by deleting any definitions from the Indenture with respect to which references would be eliminated as a result of the amendments of the Indenture pursuant to Section 1.01 hereof. To the extent any Article, Section, definition or paragraph of the Indenture has been amended or deleted from the Indenture pursuant to Section 1.01 hereof, any reference in any provision of the Indenture or any Note to such Article, Section, definition or paragraph shall be deemed so amended or disregarded in, and be deemed eliminated from, such provisions, as applicable. Except as amended hereby, all of the terms of the Indenture shall remain and continue in full force and effect and are hereby confirmed in all respects.

Section 1.03    Effectiveness of Amendments. The amendments set forth in Section 1.01 hereof shall not become operative until the Trustee shall have received from the Company written confirmation that (i) the Final Settlement Date (as defined in the Purchase Offer Document) has occurred, (ii) the Company has deposited with the Depositary the amount of cash necessary to pay each tendering Holder in the Purchase Offer the Total Consideration (as defined in the Purchase Offer Document), with respect to Notes tendered prior to the Early Tender Date (as defined in the Purchase Offer Document) and the Tender Offer Consideration (as defined in the Purchase Offer Document), with respect to Notes tendered after the Early Tender Date but prior to the Expiration Date (as defined in the Purchase Offer Document) and (iii) the Company has accepted for purchase all Notes validly tendered and not withdrawn in the Purchase Offer.

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

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

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

Section 2.04    Effectiveness; Termination. This Supplemental Indenture shall become effective on the date first above written; provided, however, that the amendments to the Indenture set forth in Section 1.01  of this Supplemental Indenture shall become effective only if the conditions set forth in Section 1.03 of this Supplemental Indenture have been satisfied. 

Section 2.05    Acceptance by Trustee. The Trustee accepts the amendments to the Indenture effected by this Supplemental Indenture and agrees to execute the trusts created by the Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture.  This Supplemental Indenture constitutes a request of the Company in accordance with Section 9.02(c) of the Indenture.

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

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

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

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

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

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Section 2.11    Counterparts. The parties hereto may sign any number of copies of this Supplemental Indenture. This Supplemental Indenture may be signed in counterparts and by the different parties hereto in separate counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or portable document format (.pdf) transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signature of the parties hereto transmitted by facsimile or .pdf shall be deemed to be their original signatures for all purposes.

[Signature pages follow]

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

COMPANY:

COMSTOCK RESOURCES, INC.

By:      /s/ Roland O. Burns                                        
Name: Roland O. Burns
Title:   President, Chief Financial Officer and Secretary

SUBSIDIARY GUARANTORS:  

COMSTOCK OIL & GAS, LLC

By:      /s/ Roland O. Burns                                        
Name: Roland O. Burns
Title:   President, Chief Financial Officer and Secretary

COMSTOCK OIL & GAS - LOUISIANA, LLC

By:      /s/ Roland O. Burns                                        
Name: Roland O. Burns
Title:   President, Chief Financial Officer and Secretary

TRUSTEE:

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC, AS TRUSTEE  

            
By:      /s/ Paul H. Kim                                               
Name: Paul H. Kim
Title:   Asst. General CounselExhibit 4.1

		
			Exhibit 4.1
		

		
			DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934
		

		
			As of December 31, 2020, NCS Multistage Holdings, Inc. (“NCS,” the “Company,” “we,” “our” or “us”) had one class of securities, our common stock, par value $0.01 per share (“Common Stock”), registered under Section 12 of the Securities Exchange Act of 1934, as amended.
		

		
			The following description of our Common Stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our Second Amended and Restated Certificate of Incorporation (as amended by the Certificate of Amendment, the “Certificate of Incorporation”) and our Amended and Restated Bylaws (the “Bylaws”), each of which are incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.1 is a part.
		

		
			Authorized Capitalization
		

		
			Our authorized capital stock consists of 11,250,000 shares of common stock, par value $0.01 per share and 10,000,000 shares of preferred stock, par value $0.01 per share. 
		

		
			Common Stock
		

		
			Holders of our common stock are entitled to the rights set forth below.
		

		
			Voting Rights
		

		
			Directors are elected by a plurality of the votes entitled to be cast except as set forth below with respect to directors elected by the holders of common stock. Our stockholders do not have cumulative voting rights. Except as otherwise provided in our Certificate of Incorporation or as required by law, all matters to be voted on by our stockholders other than matters relating to the election and removal of directors must be approved by a majority of the votes properly cast for or against such matter, and, for the avoidance of doubt, neither abstention nor broker non-votes shall be counted as votes cast for or against such matter or by a written resolution of the stockholders representing the number of affirmative votes required for such matter at a meeting.
		

		
			Dividend Rights
		

		
			Holders of common stock will share equally in any dividend declared by our board of directors (our “Board”), subject to the rights of the holders of any outstanding preferred stock.
		

		
			Liquidation Rights
		

		
			In the event of any voluntary or involuntary liquidation, dissolution, distribution of assets or winding up of our affairs, holders of our common stock would be entitled to share ratably in our assets that are legally available for distribution to stockholders after payment of liabilities. If we have any preferred stock outstanding at such time, holders of the preferred stock may be entitled to distribution and/or liquidation preferences. In either such case, we must pay the applicable distribution to the holders of our preferred stock before we may pay distributions to the holders of our common stock.
		

		
			Registration Rights
		

		
			In connection with our initial public offering, funds (the “Advent Funds”), managed by Advent International Corporation (“Advent”), the Company and certain stockholders of the Company entered into a Registration Rights Agreement, dated May 3, 2017 (the “Registration Rights Agreement”). The Registration Rights Agreement provides for (i) demand registration rights for Advent, subject to a required anticipated aggregate gross proceeds of $25.0 million; (ii) piggyback registration rights for certain stockholders, subject to a pro rata reduction if the total amount of shares requested to be included exceeds the amount of securities which in the opinion of the underwriters can be sold; and (iii) shelf registration rights that may be requested by Advent to include registrable securities of Advent and certain stockholders, subject to a required anticipated aggregate gross proceeds of $10.0 million; provided that any such holders that are capable of selling all of their registrable securities pursuant to Rule 144 of the Securities Act, without timing or volume limitations will not have these piggyback registration rights. We will be responsible for fees and expenses in connection with the registration rights, other than underwriters’ discounts and brokers’ commissions, if any, relating to any such registration and offering.
		

		

		

		 

 

		Other Rights
		

		
			Our stockholders have no preemptive or other rights to subscribe for additional shares. All holders of our common stock are entitled to share equally on a share-for-share basis in any assets available for distribution to common stockholders upon our liquidation, dissolution or winding up.
		

		
			Preferred Stock
		

		
			Our Board is authorized to provide for the issuance of preferred stock in one or more series and to fix the preferences, powers and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof, including the dividend rate, conversion rights, voting rights, redemption rights and liquidation preference and to fix the number of shares to be included in any such series without any further vote or action by our stockholders. Any preferred stock so issued may rank senior to our common stock with respect to the payment of dividends or amounts upon liquidation, dissolution or winding up, or both. In addition, any such shares of preferred stock may have class or series voting rights. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of our company without further action by the stockholders and may adversely affect the voting and other rights of the holders of our common stock.
		

		
			No shares of preferred stock are currently outstanding.
		

		
			Anti-takeover Provisions
		

		
			Our Certificate of Incorporation and Bylaws contain provisions that delay, defer or discourage transactions involving an actual or potential change in control of us or change in our management. We expect that these provisions, which are summarized below, discourage coercive takeover practices or inadequate takeover bids. These provisions are designed to encourage persons seeking to acquire control of us to first negotiate with our Board, which we believe may result in an improvement of the terms of any such acquisition in favor of our stockholders. However, they also give our Board the power to discourage transactions that some stockholders may favor, including transactions in which stockholders might otherwise receive a premium for their shares or transactions that our stockholders might otherwise deem to be in their best interests. Accordingly, these provisions could adversely affect the price of our common stock.
		

		
			Requirements for Advance Notification of Stockholder Meetings, Nominations and Proposals
		

		
			Our Bylaws provide that special meetings of the stockholders may be called only upon the request of a majority of our Board or upon the request of the Chief Executive Officer. Our Bylaws prohibit the conduct of any business at a special meeting other than as specified in the notice for such meeting. These provisions may have the effect of deferring, delaying or discouraging hostile takeovers or changes in control or management of our company.
		

		
			Our Bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of our Board or a committee of our Board. In order for any matter to be “properly brought” before a meeting, a stockholder will have to comply with the advance notice requirements described in our Bylaws. Our Bylaws allow the presiding officer at a meeting of the stockholders to adopt rules and regulations for the conduct of meetings which may have the effect of precluding the conduct of certain business at a meeting if the rules and regulations are not followed. These provisions may also defer, delay or discourage a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.
		

		
			No Stockholder Action by Written Consent
		

		
			Our Certificate of Incorporation provides that after the time that the Advent Funds collectively own less than 50.01% of our then outstanding common stock, subject to the rights of any holders of preferred stock to act by written consent instead of a meeting, stockholder action may be taken only at an annual meeting or special meeting of stockholders and may not be taken by written consent instead of a meeting, unless the directors then in office unanimously recommend that such action be permitted to be taken by written consent of stockholders. Failure to satisfy any of the requirements for a stockholder meeting could delay, prevent or invalidate stockholder action.
		

		
			Section 203 of the Delaware General Corporation Law, as amended (“DGCL”)
		

		
			Our Certificate of Incorporation provides that the provisions of Section 203 of the DGCL, which relate to business combinations with interested stockholders, do not apply to us. Section 203 of the DGCL prohibits a publicly held Delaware corporation from engaging in a business combination transaction with an interested stockholder (a stockholder who owns more than 15% of our common stock) for a period of three years after the interested stockholder became such unless the transaction fits within an applicable exemption, such as Board approval of the business combination or the transaction that resulted in such stockholder becoming an 
		

		 

 

		interested stockholder. These provisions will apply even if the business combination could be considered beneficial by some stockholders. Although we have elected to opt out of the statute’s provisions, we could elect to be subject to Section 203 in the future.
		

		
			Amendment to Bylaws and Certificate of Incorporation
		

		
			Any amendment to our Certificate of Incorporation must first be approved by a majority of our Board and (i) if required by law, thereafter be approved by a majority of the outstanding shares entitled to vote on the amendment or (ii) if related to provisions regarding the classification of our Board, the removal of directors, director vacancies, forum selection for certain lawsuits, indemnification, corporate opportunities, business combinations, severability, the provision opting-out of Section 203 of the DGCL or the amendment of certain provisions of our Bylaws or Certificate of Incorporation, thereafter be approved by at least 66 2/3% of the outstanding shares entitled to vote on the amendment. For so long as the Advent Funds beneficially owns 10% or more of our issued and outstanding common stock entitled to vote generally in the election of directors, any amendment to provisions regarding Section 203 of the DGCL or corporate opportunities must also receive Advent’s prior written consent. Our Bylaws may be amended (x) by the affirmative vote of a majority of the directors then in office, subject to any limitations set forth in the bylaws, without further stockholder action or (y) by the affirmative vote of at least 66 2/3% of the outstanding shares entitled to vote on the amendment, without further action by our Board.
		

		
			Exclusive Forum
		

		
			Our Certificate of Incorporation provides that, subject to certain exceptions, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for certain stockholder litigation matters. However, it is possible that a court could rule that this provision is unenforceable or inapplicable.
		

		
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			Listing
		

		
			Our Common Stock is listed on the NASDAQ Capital Market under the symbol “NCSM.”
		

		
			Transfer Agent and Registrar
		

		
			The transfer agent and registrar for our common stock is Computershare Trust Company, N.A.
		

		
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