EXHIBIT 99.87
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SECOND SUPPLEMENTAL TRUST INDENTURE
This Second Supplemental Trust Indenture is entered into as of the 14th day of
September 2004 among:
ADVANTAGE ENERGY INCOME FUND, an open ended trust
governed under the laws of the Province of Alberta and
having its head office in the City of Calgary, in the
Province of Alberta (hereinafter called the "TRUST")
- and -
ADVANTAGE OIL & GAS LTD., a corporation existing under
the laws of the Province of Alberta and having its head
office in the City of Calgary, in the Province of
Alberta (hereinafter called "AOG" or the "CORPORATION")
- and -
COMPUTERSHARE TRUST COMPANY OF CANADA, a trust company
incorporated under the federal laws of Canada having an
office in the City of Calgary, in the Province of
Alberta in its capacity as trustee under a trust
indenture dated July 8, 2003 with the Trust and the
Corporation (hereinafter called the "DEBENTURE TRUSTEE")
WITNESSETH THAT:
WHEREAS the Trust, the Corporation and the Debenture Trustee entered
into an indenture (the "INDENTURE") dated July 8, 2003 to provide for the
creation and issuance of debentures for the Trust's investment purposes;
AND WHEREAS Article 16 of the Indenture provides that the Debenture
Trustee and the Trust may enter into indentures supplemental to the Indenture;
AND WHEREAS the Trust, the Corporation and the Debenture Trustee
entered into a first supplemental indenture to the Indenture dated December 2,
2003 to provide for the creation and issuance of Series 2, 8.25% convertible
unsecured subordinated debentures;
AND WHEREAS the Trust has determined to create and issue a third and
fourth series of debentures being 7.50% extendible convertible unsecured
subordinated debentures (the "7.50% DEBENTURES") due November 1, 2004, or, in
certain circumstances, October 1, 2009 and 7.75% extendible convertible
unsecured subordinated debentures (the "7.75% DEBENTURES") due November 1, 2004,
or, in certain circumstances, December 1, 2011, respectively, (unless the
context indicates otherwise the 7.50% Debentures and 7.75% Debentures are
collectively referred to herein as the "NEW DEBENTURES") and to enter into this
second supplemental indenture (this "SUPPLEMENTAL INDENTURE") with the Debenture
Trustee to provide for such creation and issuance of New Debentures;
AND WHEREAS all necessary acts and proceedings have been done and taken
and all necessary resolutions have been passed to authorize the execution and
delivery of this Supplemental Indenture, to make the same effective and binding
upon the Trust, and to make the New Debentures, when authenticated by the
Debenture Trustee and issued as provided in the Indenture and this Supplemental
Indenture, valid, binding and legal obligations of the Trust with the benefit
and subject to the terms of the Indenture and this Supplemental Indenture;
AND WHEREAS the foregoing recitals are made as representations and
statements of fact by the Trust and not by the Debenture Trustee.
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NOW THEREFORE it is hereby covenanted, agreed and declared as follows:
ARTICLE 1
DEFINITIONS AND AMENDMENTS TO INDENTURE
1.1 DEFINITIONS
All capitalized terms not defined herein shall have the meanings given
to them in the Indenture and, in addition, in this Supplemental Indenture and in
the New Debentures, unless there is something in the subject matter or context
inconsistent therewith, the expressions following shall have the following
meanings, namely:
(a) "ACQUISITION" means the acquisition by AOG, substantially and in all
material respects as contemplated in the Acquisition Agreement, of the
Assets;
(b) "ACQUISITION AGREEMENT" means the Agreement of Purchase and Sale dated
August 24, 2004 between Anadarko and AOG pursuant to which Anadarko
agreed to sell and AOG agreed to purchase the Assets;
(c) "ACQUISITION DATE" means the date upon which the closing of the
Acquisition takes place, and "ACQUISITION TIME" means the time on the
Acquisition Date at which the closing of the Acquisition takes place;
(d) "ANADARKO" means Anadarko Canada Corporation, the managing partner of
Anadarko Canada Resources;
(e) "ASSETS" means those petroleum and natural gas properties and related
assets that AOG expects to acquire from Anadarko pursuant to the
Acquisition Agreement;
(f) "PROSPECTUS" means the English and French language versions (unless the
context indicates otherwise) of the (final) short form prospectus of
the Trust dated September 3, 2004 relating to, INTER ALIA, the
distribution of 3,500,000 subscription receipts at a price of $18.80
per subscription receipt, $75,000,000 principal amount of 7.50%
Debentures and $50,000,000 principal amount of 7.75% Debentures in all
of the provinces of Canada and, unless the context otherwise requires,
includes all documents incorporated therein by reference and any
amendments thereto;
(g) "TERMINATION TIME" means the earlier of: (i) 5:00 p.m. (Calgary time)
on November 1, 2004 if the closing of the Acquisition has not taken
place by that time, and (ii) the date upon which the Acquisition is
terminated or the Trust has advised the Underwriters or announced to
the public that it does not intend to proceed with the Acquisition; and
(h) "UNDERWRITERS" means Scotia Capital Inc., BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Inc.,
National Bank Financial Inc., RBC Dominion Securities Inc., CIBC World
Markets Inc., FirstEnergy Capital Corp. and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Ltd.
1.2 AMENDMENTS TO INDENTURE
This Supplemental Indenture is supplemental to the Indenture and the
Indenture and this Supplemental Indenture shall hereafter be read together and
shall have effect, so far as practicable, with respect to the New Debentures as
if all the provisions of the Indenture and this Supplemental Indenture were
contained in one instrument. The Indenture is and shall remain in full force and
effect with regards to all matters governing the Initial Debentures and with
regards to all matters governing the New
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Debentures, except as the Indenture is amended, superseded, modified or
supplemented by this Supplemental Indenture. Any references in the text of this
Supplemental Indenture to section numbers, article numbers, "hereto", "herein",
"hereby", "hereunder", "hereof" and similar expressions refer to the Indenture
unless otherwise qualified.
ARTICLE 2
THE DEBENTURES
2.1 FORM AND TERMS OF NEW DEBENTURES
(a) The third and fourth series of debentures authorized for issue
immediately are limited to an aggregate principal amount of $75,000,000
7.50% Debentures which shall be designated as "Series 3, 7.50%
Extendible Convertible Unsecured Subordinated Debentures" and to an
aggregate principal amount of $50,000,000 7.75% Debentures which shall
be designated as "Series 4, 7.75% Extendible Convertible Unsecured
Subordinated Debentures", respectively.
(b) The 7.50% Debentures shall be dated as of September 14, 2004, and shall
bear interest from such date at the rate of 7.50% per annum, payable in
semi-annual payments on April 1 and October 1 in each year, the first
such payment to fall due, subject as hereinafter provided, on April 1,
2005 and the last such payment (representing interest payable from the
last Interest Payment Date to, but excluding, the Maturity Date of the
7.50% Debentures), subject as hereinafter provided, to fall due on
October 1, 2009, payable after as well as before maturity and after as
well as before default, with interest on amounts in default at the same
rate, compounded semi-annually. For certainty, subject to adjustment as
hereinafter provided, the first interest payment will include interest
accrued from September 14, 2004 to, but excluding, April 1, 2005, which
will be equal to $40.8904 for each $1,000 principal amount of the 7.50%
Debentures. If the closing of the Acquisition does not take place by
5:00 p.m. (Calgary time) on November 1, 2004, the Acquisition is
terminated at any earlier time or if the Trust has advised the
Underwriters or announced to the public that it does not intend to
proceed with the Acquisition, then the 7.50% Debentures will initially
mature on November 1, 2004. If the Acquisition takes place prior to
5:00 p.m. (Calgary time) on November 1, 2004, then the Maturity Date of
the 7.50% Debentures will be automatically extended from November 1,
2004 to October 1, 2009 without any further act or formality on the
part of the Trust or the Debenture Trustee. The Trust will announce by
press release the closing of the Acquisition or the Termination Time,
as the case may be, and confirmation of the Maturity Date and will
provide a copy thereof to the Debenture Trustee in accordance with
Section 14.3.
(c) The 7.75% Debentures shall be dated as of September 14, 2004, and shall
bear interest from such date at the rate of 7.75% per annum, payable in
semi-annual payments on June 1 and December 1 in each year, the first
such payment to fall due, subject as hereinafter provided, on June 1,
2005 and the last such payment (representing interest payable from the
last Interest Payment Date to, but excluding, the Maturity Date of the
7.75% Debentures), subject as hereinafter provided, to fall due on
December 1, 2011, payable after as well as before maturity and after as
well as before default, with interest on amounts in default at the same
rate, compounded semi-annually. For certainty, subject to adjustment as
hereinafter provided, the first interest payment will include interest
accrued from September 14, 2004 to, but excluding, June 1, 2005, which
will be equal to $55.2055 for each $1,000 principal amount of the 7.75%
Debentures. If the closing of the Acquisition does not take place by
5:00 p.m. (Calgary time) on November 1, 2004,
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the Acquisition is terminated at any earlier time or if the Trust has
advised the Underwriters or announced to the public that it does not
intend to proceed with the Acquisition, then the 7.75% Debentures will
initially mature on November 1, 2004. If the Acquisition takes place
prior to 5:00 p.m. (Calgary time) on November 1, 2004, then the
Maturity Date of the 7.75% Debentures will be automatically extended
from November 1, 2004 to December 1, 2011 without any further act or
formality on the part of the Trust or the Debenture Trustee. The Trust
will announce by press release the closing of the Acquisition or the
Termination Time, as the case may be, and confirmation of the Maturity
Date and will provide a copy thereof to the Debenture Trustee in
accordance with Section 14.3.
(d) The New Debentures will be redeemable in accordance with the terms of
Article 4, provided that:
(i) the 7.50% Debentures will not be redeemable on or before
October 1, 2007, except in the event of the satisfaction of
certain conditions after a Change of Control has occurred as
outlined herein. Subsequent to October 1, 2007 and on or prior
to October 1, 2008, the 7.50% Debentures may be redeemed at
the option of the Trust in whole or in part from time to time
on notice as provided for in Section 4.3 at a Redemption Price
of $1,050 per $1,000 principal amount of 7.50% Debentures and,
in addition thereto, at the time of redemption, the Trust
shall pay to the holder accrued and unpaid interest. After
October 1, 2008 and prior to maturity, the 7.50% Debentures
may be redeemed at the option of the Trust in whole or in part
from time to time on notice as provided for in Section 4.3
hereof at a Redemption Price of $1,025 per $1,000 principal
amount of 7.50% Debentures and, in addition thereto, at the
time of redemption, the Trust shall pay to the holder accrued
and unpaid interest; and
(ii) the 7.75% Debentures will not be redeemable on or before
December 1, 2007, except in the event of the satisfaction of
certain conditions after a Change of Control has occurred as
outlined herein. Subsequent to December 1, 2007 and on or
prior to December 1, 2008, the 7.75% Debentures may be
redeemed at the option of the Trust in whole or in part from
time to time on notice as provided for in Section 4.3 at a
Redemption Price equal to $1,050 per $1,000 principal amount
of 7.75% Debentures plus accrued and unpaid interest. After
December 1, 2008, and on or prior to December 1, 2009, the
7.75% Debentures may be redeemed at the option of the Trust in
whole or in part from time to time on notice as provided for
in Section 4.3 hereof at a Redemption Price equal to $1,025
per $1,000 principal amount of 7.75% Debentures plus accrued
and unpaid interest. After December 1, 2009 and prior to
maturity, the 7.75% Debentures may be redeemed at the option
of the Trust in whole or in part from time to time on notice
as provided for in Section 4.3 at a Redemption Price of $1,000
per $1,000 principal amount of 7.75% Debentures and, in
addition thereto, at the time of redemption, the Trust shall
pay to the holder accrued and unpaid interest.
The Redemption Notice for the New Debentures shall be in the form of
SCHEDULE B hereof. In connection with the redemption of the New
Debentures, the Trust may, at its option and subject to the provisions
of Section 4.6 and subject to regulatory approval, elect to satisfy its
obligation to pay all or a portion of the aggregate Redemption Price of
the New Debentures to be redeemed by issuing and delivering to the
holders of such New Debentures, such number of Freely Tradeable Trust
Units as is obtained by dividing the Redemption Price by 95% of the
Current Market Price in effect on the Redemption Date.
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Interest accrued and unpaid on the New Debentures to be redeemed on the
Redemption Date will be paid to holders of New Debentures, in cash, in
the manner contemplated in Section 4.5. If the Trust elects to exercise
such option, it shall so specify and provide details in the Redemption
Notice.
(e) The New Debentures will be subordinated to the Senior Indebtedness of
the Trust in accordance with the provisions of Article 5.
(f) Upon and subject to the provisions and conditions of Article 6, and
upon delivering a conversion notice in the form attached hereto as
SCHEDULE D, the holder of each 7.50% Debenture shall have the right at
such holder's option, at anytime when the register of the Debenture
Trustee is open, prior to the close of business on the earlier of
November 1, 2004 or October 1, 2009, as applicable, and the last
Business Day immediately preceding the date specified by the Trust for
redemption of the 7.50% Debentures by notice to the holders of 7.50%
Debentures in accordance with Sections 2.4(c) and 4.3 (the earlier of
which will be the "TIME OF EXPIRY" for the purposes of Article 6 in
respect of the 7.50% Debentures), to convert any part, which is $1,000
or an integral multiple thereof, of the principal amount of such 7.50%
Debenture into Trust Units at the Conversion Price in effect on the
Date of Conversion (as defined in Section 6.4(b)).
Upon and subject to the provisions and conditions of Article 6, and
upon delivering a conversion notice in the form attached hereto as
SCHEDULE D, the holder of each 7.75% Debenture shall have the right at
such holder's option, at any time prior to the close of business on the
earlier of November 1, 2004 or December 1, 2011, as applicable, and the
last Business Day immediately preceding the date specified by the Trust
for redemption of the New Debentures by notice to the holders of 7.75%
Debentures in accordance with Sections 2.4(c) and 4.3 (the earlier of
which will be the "TIME OF EXPIRY" for the purposes of Article 6 in
respect of the 7.75% Debentures), to convert the whole or, in the case
of a 7.75% Debenture of a denomination in excess of $1,000, any part
which is $1,000 or an integral multiple thereof, of the principal
amount of a New Debenture into Trust Units at the Conversion Price in
effect on the Date of Conversion (as defined in Section 6.4(b)).
The Conversion Price in effect on the date hereof for each Trust Unit
to be issued upon the conversion of 7.50% Debentures shall be equal to
$20.25 such that approximately 49.3827 Trust Units shall be issued for
each $1,000 principal amount of 7.50% Debentures so converted. The
Conversion Price in effect on the date hereof for each Trust Unit to be
issued upon the conversion of 7.75% Debentures shall be equal to $21.00
such that approximately 47.6190 Trust Units shall be issued for each
$1,000 principal amount of 7.75% Debentures so converted. No adjustment
in the number of Trust Units to be issued upon conversion will be made
for distributions on Trust Units issuable upon conversion or for
interest accrued on the New Debentures which are surrendered for
conversion; however, holders converting their New Debentures will
receive all interest which has accrued to but excluding the Date of
Conversion (as defined in Section 6.4(b)) which has not been paid. The
Conversion Price applicable to and the Trust Units, securities or other
property receivable on the conversion of the New Debentures is subject
to adjustment pursuant to the provisions of Section 6.5.
Notwithstanding any other provisions of this Indenture, if a New
Debenture is surrendered for conversion on an Interest Payment Date or
during the three preceding Business Days, the person or persons
entitled to receive Trust Units in respect of the New
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Debenture so surrendered for conversion shall not become the holder or
holders of record of such Trust Units until the Business Day following
such Interest Payment Date.
(g) On maturity of the New Debentures, the Trust may, at its option and
subject to the provisions of Section 4.10 and subject to regulatory
approval, elect to satisfy its obligation to pay all or a portion of
the aggregate principal amount of the New Debentures due on maturity by
issuing and delivering to such holders of New Debentures Freely
Tradeable Trust Units pursuant to the provisions of Section 4.10. If
the Trust elects to exercise such option, it shall deliver a maturity
notice (the "MATURITY NOTICE") to the holders of the New Debentures in
the form of SCHEDULE C hereof and provide the necessary details.
(h) The New Debentures shall be issued as Fully Registered New Debentures
in denominations of $1,000 and integral multiples of $1,000. Each 7.50%
Debenture and 7.75% Debenture and the certificate of the Debenture
Trustee endorsed thereon shall be issued in substantially the form set
out in SCHEDULE A of this Supplemental Indenture, with such insertions,
omissions, substitutions or other variations as shall be required or
permitted by this Indenture, and may have imprinted or otherwise
reproduced thereon such legend or legends or endorsements, not
inconsistent with the provisions of the Indenture or this Supplemental
Indenture, as may be required to comply with any law or with any rules
or regulations pursuant thereto or with any rules or regulations of any
securities exchange or securities regulatory authority or to conform
with general usage, all as may be determined by the directors of AOG
(on behalf of the Trust) executing such New Debenture in accordance
with Section 2.7 hereof, as conclusively evidenced by their execution
of an New Debenture. Each New Debenture shall additionally bear such
distinguishing letters and numbers as the Debenture Trustee shall
approve. Notwithstanding the foregoing, a New Debenture may be in such
other form or forms as may, from time to time, be, approved by a
resolution of the directors of AOG, on behalf of the Trust or as
specified in an Officer's Certificate. The New Debentures may be
engraved, lithographed, printed, mimeographed or typewritten or partly
in one form and partly in another.
The New Debentures shall be issued as Global Debentures and the
Depositary for the New Debentures shall be The Canadian Depositary for
Securities Limited. The Global Debentures shall be registered in the
name of The Canadian Depositary for Securities Limited (or any nominee
of the Depositary). No beneficial holder will receive definitive
certificates representing their interest in New Debentures except as
provided in Section 3.2. A Global Debenture may be exchanged for New
Debentures in registered form that are not Global Debentures, or
transferred to and registered in the name of a person other than the
Depository for such Global Debentures or a nominee thereof as provided
in Section 3.2.
(i) Upon and subject to the provisions and conditions of Article 10, the
Trust may elect, from time to time, to satisfy its Interest Obligation
on the New Debentures on any Interest Payment Date by delivering Trust
Units to the Debenture Trustee.
(j) Within 30 days following the occurrence of a Change of Control, and
subject to the provisions and conditions of this Section 2.1(j), the
Trust shall be obligated to offer in writing to each holder of New
Debentures (the "OFFER") to purchase the New Debentures. The terms and
conditions of such obligation are set forth below:
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(i) Within 30 days following the occurrence of a Change of
Control, the Trust shall deliver to the Debenture Trustee, and
the Debenture Trustee shall promptly deliver to the holders of
the New Debentures a notice stating that there has been a
Change of Control and specifying the circumstances surrounding
such event (a "CHANGE OF CONTROL NOTICE") together with the
Offer to purchase all then outstanding New Debentures made in
accordance with the requirements of Applicable Securities
Legislation at a price equal to 101% of the principal amount
thereof plus accrued and unpaid interest, if any, on such New
Debentures up to, but excluding, the date of acquisition by
the Trust or a related party of such New Debentures (the
"OFFER PRICE") which Offer shall, unless otherwise provided
under Applicable Securities Legislation, be open for
acceptance thereof for a period of not less than 35 days and
not more than 60 days and shall provide for payment to all New
Debenture holders who accept the Offer not later than the 60th
day after the making of the Offer (collectively, the "TOTAL
OFFER PRICE").
(ii) If 90% or more in aggregate principal amount of the 7.50%
Debentures or 7.75% Debentures (as the case may be)
outstanding on the date the Trust provides the Change of
Control Notice and the Offer to holders of the 7.50%
Debentures or 7.75% Debentures (as the case may be) have been
tendered for purchase pursuant to the Offer on the expiration
thereof, the Trust shall provide written notice to the
Debenture Trustee, along with the aggregate Offer Price for
the 7.50% Debentures or 7.75% Debentures (as the case may be)
remaining outstanding at the expiration of the Offer, within
10 days following the expiration of the Offer, that it is
redeeming and shall redeem all the 7.50% Debentures or 7.75%
Debentures (as the case may be) remaining outstanding on the
expiration of the Offer at the aggregate Offer Price for such
7.50% Debentures or 7.75% Debentures (as the case may be)
remaining outstanding (the "90% REDEMPTION Right").
(iii) Upon receipt of notice that the Trust is acquiring the
remaining 7.50% Debentures or 7.75% Debentures (as the case
may be) pursuant to the 90% Redemption Right, the Debenture
Trustee shall promptly provide written notice to each
Debentureholder that did not previously accept the Offer that:
(A) the Trust is purchasing all outstanding 7.50%
Debentures or 7.75% Debentures (as the case may be)
effective on the expiry of the Offer at the aggregate
Offer Price for such remaining 7.50% Debentures or
7.75% Debentures (as the case may be), and shall
include a calculation of the amount payable to such
holder as payment of the Total Offer Price;
(B) each such holder must transfer its 7.50% Debentures
or 7.75% Debentures (as the case may be) to the
Debenture Trustee on the same terms as those holders
that accepted the Offer and must send its 7.50%
Debentures or 7.75% Debentures (as the case may be) ,
duly endorsed for transfer, to the Debenture Trustee
within 10 days after the sending of such notice; and
(C) the rights of such holder under the terms of the
7.50% Debentures or 7.75% Debentures (as the case may
be), the Indenture and this Supplemental Indenture
cease effective as of the date of expiry of the Offer
provided the Trust has, on or before the time of
notifying the Debenture Trustee of the redemption
pursuant to the 90% Redemption
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Right, paid the aggregate Offer Price for such 7.50%
Debentures, or 7.75% Debentures (as the case may be)
to, or to the order of, the Debenture Trustee and
thereafter such 7.50% Debentures or 7.75% Debentures
(as the case may be) shall not be considered to be
outstanding and the holder shall not have any right
except to receive such holder's Offer Price upon
surrender and delivery of such holder's 7.50%
Debentures or 7.75% Debentures (as the case may be)
in accordance with the Indenture.
(iv) The Trust shall, on or before 11:00 a.m., (Calgary time), on
the Business Day immediately prior to the expiry of the Offer,
deposit with the Debenture Trustee or any paying agent to the
order of the Debenture Trustee, such sums of money as may be
sufficient to pay the Offer Price for each New Debenture to be
purchased or redeemed by the Trust on the expiry of the Offer,
provided the Trust may elect to satisfy this requirement by
providing the Debenture Trustee with a cheque for such amounts
required under this Section 2.1(j)(iv) post-dated to the date
of expiry of the Offer. The Trust shall also deposit with the
Debenture Trustee a sum of money sufficient to pay any charges
or expenses which may be incurred by the Debenture Trustee in
connection with such purchase and/or redemption, as the case
may be. Every such deposit shall be irrevocable. From the sums
so deposited, the Debenture Trustee shall pay or cause to be
paid to the holders of such New Debentures, the Offer Price
for each such New Debenture to which they are entitled on the
Trust's purchase or redemption.
(v) In the event that one or more of such New Debentures being
purchased in accordance with this Section 2.1(j) becomes
subject to purchase in part only, upon surrender of such New
Debentures for payment of the Offer Price for each such New
Debenture, the Trust shall execute and the Debenture Trustee
shall certify and deliver without charge to the holder thereof
or upon the holder's order, one or more New Debentures for the
portion of the principal amount of the New Debentures not
purchased.
(vi) New Debentures for which holders have accepted the Offer and
New Debentures which the Trust is redeeming in accordance with
this Section 2.1(j) shall become due and payable at the Offer
Price for each such New Debenture on the date of expiry of the
Offer, in the same manner and with the same effect as if it
were the date of maturity specified in such New Debentures,
anything therein or herein to the contrary notwithstanding,
and from and after such date of expiry of the Offer, if the
money necessary to purchase or redeem the New Debentures shall
have been deposited as provided in this Section 2.1(j) and
affidavits or other proofs satisfactory to the Debenture
Trustee as to the publication and/or mailing of such notices
shall have been lodged with it, interest on the New Debentures
shall cease. If any question shall arise as to whether any
notice has been given as above provided and such deposit made,
such question shall be decided by the Debenture Trustee whose
decision shall be final and binding upon all parties in
interest.
(vii) In case the holder of any New Debenture to be purchased or
redeemed in accordance with this Section 2.1(j) shall fail on
or before the date of expiry of the Offer so to surrender such
holder's New Debenture or shall not within such time accept
payment of the monies payable, or give such receipt therefor,
if any, as the Debenture Trustee may require, such monies may
be set aside in trust, either in
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the deposit department of the Debenture Trustee or in a
chartered bank, and such setting aside shall for all purposes
be deemed a payment to the Debentureholder of the sum so set
aside and the Debentureholder shall have no other right except
to receive payment of the monies so paid and deposited, upon
surrender and delivery up of such holder's New Debenture. In
the event that any money required to be deposited hereunder
with the Debenture Trustee or any depository or paying agent
on account of principal, premium, if any, or interest, if any,
on New Debentures issued hereunder shall remain so deposited
for a period of six years from the date of expiry of the
Offer, then such monies, together with any accumulated
interest thereon, shall at the end of such period be paid over
or delivered over by the Debenture Trustee or such depository
or paying agent to the Trust and the Debenture Trustee shall
not be responsible to Debentureholders for any amounts owing
to them. Notwithstanding the foregoing, the Debenture Trustee
will pay any remaining funds deposited hereunder prior to the
expiry of six years after the date of expiry of the Offer to
the Trust upon receipt from the Trust, or one of its
Subsidiaries, of an uncontested letter of credit from a
Canadian chartered bank in an amount equal to or in excess of
the amount of the remaining funds. If the remaining funds are
paid to the Trust prior to the expiry of six years after the
date of expiry of the Offer, the Trust shall reimburse the
Debenture Trustee for any amounts required to be paid by the
Debenture Trustee to a holder of a New Debenture pursuant to
the Offer after the date of such payment of the remaining
funds to the Trust but prior to six years after the date of
expiry of the Offer.
(viii) Subject to the provisions above related to New Debentures
purchased in part, all New Debentures redeemed and paid under
this Section 2.1(j) shall forthwith be delivered to the
Debenture Trustee and cancelled and no New Debentures shall be
issued in substitution therefor.
(k) The Debenture Trustee shall be provided with the documents and
instruments referred to in Sections 2.5(b), (c) and (d) with respect to
the New Debentures prior to the issuance of the New Debentures.
(l) AOG may, at any time and from time to time, in its sole discretion,
request that the Debenture Trustee make reasonable efforts, as
practicable in the circumstances, to obtain declarations as to
beneficial ownership of New Debentures, perform residency searches of
holders of New Debentures and beneficial holders of New Debentures
mailing address lists and take such other steps specified by AOG to
determine or estimate as best possible the residence of the beneficial
owners of New Debentures. If at any time the board of directors of AOG,
in its sole discretion, determines that it is in the best interest of
the Trust, AOG may: (i) require the Debenture Trustee to refuse to
accept a subscription for the New Debentures from, or issue or register
a transfer of Trust Units to, a person unless the person provides a
declaration to AOG that the New Debentures to be issued or transferred
to such person will not when issued or transferred be beneficially
owned by a non resident of Canada; (ii) to the extent practicable in
the circumstances, send a notice to registered holders of the New
Debentures which are beneficially owned by non-residents of Canada,
chosen in inverse order to the order of acquisition or registration of
such New Debentures beneficially owned by non-residents of Canada or in
such other manner as AOG may consider equitable and practicable,
requiring them to sell their New Debentures which are beneficially
owned by non-residents of Canada or a specified portion thereof within
a specified period of not less than 60 days. If the holders of New
Debentures receiving such notice have not sold the specified number of
such New
10
Debentures or provided AOG with satisfactory evidence that such New
Debentures are not beneficially owned by non-residents within such
period, AOG may, on behalf of such registered holder of New Debentures,
sell such New Debentures and, in the interim, suspend the rights
attached to such New Debentures; and (iii) take such other actions as
the board of directors of AOG determines, in its sole discretion, are
appropriate in the circumstances that will reduce or limit the number
of New Debentures held by non-residents to ensure that the Trust is not
maintained primarily for the benefit of non-residents of Canada.
ARTICLE 3
ADDITIONAL MATTERS
3.1 CONFIRMATION OF INDENTURE
The Indenture, as amended and supplemented by this Supplemental
Indenture, is in all respects confirmed.
3.2 ACCEPTANCE OF TRUSTS
The Debenture Trustee hereby accepts the trusts in this Supplemental
Indenture declared and provided for and agrees to perform the same upon the
terms and conditions and subject to the provisions set forth in the Indenture.
3.3 GOVERNING LAW
This Supplemental Indenture shall be construed in accordance with the
laws of the Province of Alberta and the laws of Canada applicable therein and
shall be treated, in all respects, as an Alberta contract.
3.4 FURTHER ASSURANCES
The parties shall, with reasonable diligence, do all such things and
provide all such reasonable assurances as may be required to consummate the
transactions contemplated by this Supplemental Indenture, and each party shall
provide such further documents or instruments required by the other party as may
be reasonably necessary or desirable to effect the purpose of this Supplemental
Indenture and carry out its provisions.
3.5 COUNTERPARTS
This Supplemental Indenture may be executed by the parties in separate
counterparts each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute one and the same instrument.
11
IN WITNESS WHEREOF the parties hereto have executed these presents
under their respective corporate seals and the hands of their proper officers in
that behalf.
ADVANTAGE ENERGY INCOME FUND,
by Advantage Oil & Gas Ltd.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice-President, Finance and
Chief Financial Officer
ADVANTAGE OIL & GAS LTD.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice-President, Finance and
Chief Financial Officer
COMPUTERSHARE TRUST COMPANY OF CANADA
By: /s/ ▇▇▇ ▇▇▇▇▇▇
--------------------------
By: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------
SCHEDULE "A"
TO THE SECOND SUPPLEMENTAL TRUST INDENTURE AMONG
ADVANTAGE ENERGY INCOME FUND, ADVANTAGE OIL & GAS LTD. AND
COMPUTERSHARE TRUST COMPANY OF CANADA
FORM OF DEBENTURE
THIS DEBENTURE IS A GLOBAL DEBENTURE WITHIN THE MEANING OF THE INDENTURE HEREIN
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF.
THIS DEBENTURE MAY NOT BE TRANSFERRED TO OR EXCHANGED FOR DEBENTURES REGISTERED
IN THE NAME OF ANY PERSON OTHER THAN THE DEPOSITORY OR A NOMINEE THEREOF AND NO
SUCH TRANSFER MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE. EVERY DEBENTURE AUTHENTICATED AND DELIVERED UPON REGISTRATION OF,
TRANSFER OF, OR IN EXCHANGE FOR, OR IN LIEU OF, THIS DEBENTURE SHALL BE A GLOBAL
DEBENTURE SUBJECT TO THE FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
CANADIAN DEPOSITORY FOR SECURITIES LIMITED ("CDS") TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IN
RESPECT THEREOF IS REGISTERED IN THE NAME OF CDS & CO., OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS (AND ANY PAYMENT IS MADE TO
CDS & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF CDS), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED HOLDER HEREOF,
CDS & CO., HAS AN INTEREST HEREIN.
[CUSIP/ISIN - ▇▇▇▇▇▇▇▇▇/CA00762LAD34]
[CUSIP/ISIN - ▇▇▇▇▇▇▇▇▇/CA00762LAE17]
NO. __________ $_________
ADVANTAGE ENERGY INCOME FUND
(A TRUST GOVERNED BY THE LAWS OF ALBERTA)
[7.50% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED DEBENTURE
DUE NOVEMBER 1, 2004 (OCTOBER 1, 2009, IF EXTENDED)]
[7.75% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED DEBENTURE
DUE NOVEMBER 1, 2004 (DECEMBER 1, 2011, IF EXTENDED)]
ADVANTAGE ENERGY INCOME FUND (the "TRUST") for value received hereby
acknowledges itself indebted and, subject to the provisions of the trust
indenture (the "INDENTURE") dated as of July 8, 2003 amended and supplemented by
the second supplemental indenture (the "SUPPLEMENTAL INDENTURE") dated as of
September 14, 2004 among the Trust, Advantage Oil & Gas Ltd. and Computershare
Trust Company of Canada (the "DEBENTURE Trustee"), promises to pay to the
registered holder hereof on [OCTOBER 1, 2009/DECEMBER 1, 2011] or on such
earlier date as the principal amount hereof may become due in accordance with
the provisions of the Supplemental Indenture (the "MATURITY DATE") the principal
sum of Dollars ($ ) in lawful money of Canada on presentation and
surrender of this Debenture (as defined herein) at the main branch of the
Debenture Trustee in Calgary, Alberta or Toronto, Ontario in accordance with the
terms of the Indenture and the Supplemental Indenture and, subject as
hereinafter provided, to pay interest on the principal amount hereof from the
date hereof, or from the last Interest Payment Date to which interest shall have
been paid or made available for payment hereon, whichever is later, at the rate
of [7.50%/7.75%] per annum, in like money, in arrears in equal (with the
exception of the first interest payment which will include interest from
September 14, 2004 to but excluding [APRIL 1, 2005/JUNE 1, 2005] as set forth
below) semi-annual instalments (less any tax required by law to be deducted) of
$ per $1,000 of principal amount of the Debentures on [APRIL 1/JUNE 1]
and [OCTOBER 1/DECEMBER 1] in each year commencing on [APRIL 1, 2005/JUNE 1,
2005] and the last payment (representing interest payable from the last Interest
Payment Date to, but excluding, the Maturity Date) to fall due on the Maturity
Date and, should the Trust at any time make default in the payment of any
principal or interest, to pay interest on the amount in default at the same
rate, in like money and on the same dates. The first interest payment will
include interest accrued from and including
A-2
September 14, 2004 to, but excluding [APRIL 1, 2005/JUNE 1, 2005], which will be
equal to $ for each $1,000 principal amount of the Debentures.
If the closing of the Acquisition does not take place by 5:00 p.m.
(Calgary time) on November 1, 2004, the Acquisition is terminated at any earlier
time or if the Trust has advised the Underwriters or announced to the public
that it does not intend to proceed with the Acquisition, then the Debentures
will initially mature on November 1, 2004. If the Acquisition takes place prior
to 5:00 p.m. (Calgary time) on November 1, 2004, then the Maturity Date of the
Debentures will be automatically extended from November 1, 2004 to [OCTOBER 1,
2009/DECEMBER 1, 2011] without any further act or formality on the part of the
Trust or the Debenture Trustee.
Interest hereon shall be payable by cheque mailed by prepaid ordinary
mail or by electronic transfer of funds to the registered holder hereof and,
subject to the provisions of the Indenture, the mailing of such cheque shall, to
the extent of the sum represented thereby (plus the amount of any tax withheld),
satisfy and discharge all liability for interest on this Debenture.
This Debenture is one of the [7.50% EXTENDIBLE CONVERTIBLE UNSECURED
SUBORDINATED DEBENTURES/7.75% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED
DEBENTURES] (referred to herein as the "Debenture") of the Trust issued or
issuable in one or more series under the provisions of the Indenture. The
Debentures authorized for issue immediately are limited to an aggregate
principal amount of [$75,000,00/50,000,000] in lawful money of Canada. Reference
is hereby expressly made to the Indenture and the Supplemental Indenture for a
description of the terms and conditions upon which the Debentures are or are to
be issued and held and the rights and remedies of the holders of the Debentures
and of the Trust and of the Debenture Trustee, all to the same effect as if the
provisions of the Indenture were herein set forth to all of which provisions the
holder of this Debenture by acceptance hereof assents.
The Debentures are issuable only in denominations of $1,000 and
integral multiples thereof. Upon compliance with the provisions of the
Indenture, Debentures of any denomination may be exchanged for an equal
aggregate principal amount of Debentures in any other authorized denomination or
denominations.
The whole, or if this Debenture is a denomination in excess of $1,000,
any part which is $1,000 or an integral multiple thereof, of the principal of
this Debenture is convertible, at the option of the holder hereof, upon
surrender of this Debenture at the principal office of the Debenture Trustee in
Calgary, Alberta or Toronto, Ontario, at any time prior to the close of business
on the Maturity Date or, if this Debenture is called for redemption on or prior
to such date, then up to but not after the close of business on the last
Business Day immediately preceding the date specified for redemption of this
Debenture, into Trust Units (without adjustment for interest accrued hereon or
for dividends or distributions on Trust Units issuable upon conversion) at a
conversion price of [$20.25/21.00] (the "CONVERSION PRICE") per Trust Unit,
being a rate of approximately [49.3827/47.6190] Trust Units for each $1,000
principal amount of Debentures, all subject to the terms and conditions and in
the manner set forth in the Indenture. No Debentures may be converted during the
three Business Days preceding and including [APRIL 1/JUNE 1] and [OCTOBER
1/DECEMBER 1] in each year, commencing [APRIL 1, 2004/JUNE 1, 2004], as the
registrars of the Debenture Trustee will be closed during such periods. The
Indenture makes provision for the adjustment of the Conversion Price in the
events therein specified. No fractional Trust Units will be issued on any
conversion but in lieu thereof, the Trust will satisfy such fractional interest
by a cash payment equal to the market price of such fractional interest
determined in accordance with the Indenture. Holders converting their Debentures
will receive accrued and unpaid interest thereon. If a Debenture is surrendered
for conversion on an Interest Payment Date or during the three preceding
Business Days, the person or persons entitled to receive Trust Units in respect
of the Debenture so surrendered for conversion shall not become the holder or
holders of record of such Trust Units until the Business Day following such
Interest Payment Date.
A-3
This Debenture may be redeemed at the option of the Trust on the terms
and conditions set out in the Indenture at the redemption price therein and
herein set out provided that this Debenture is not redeemable on or before
[OCTOBER 1, 2007/DECEMBER 1, 2007], except in the event of the satisfaction of
certain conditions after a Change of Control has occurred. After [OCTOBER 1,
2007/DECEMBER 1, 2007], and on or prior to [OCTOBER 1, 2008/DECEMBER 1, 2008],
the Debentures are redeemable at the option of the Trust at a price equal to
$1,050 per $1,000 principal amount of Debentures and, in addition thereto, at
the time of redemption, the Trust shall pay to the holder accrued and unpaid
interest and otherwise on the terms and conditions described in the Indenture.
After [OCTOBER 1, 2008/DECEMBER 1, 2008], and prior to [MATURITY/DECEMBER 1,
2009], the Debentures are redeemable at the option of the Trust at a price equal
to $1,025 per $1,000 principal amount of Debentures and, in addition thereto, at
the time of redemption, the Trust shall pay to the holder accrued and unpaid
interest and otherwise on the terms and conditions described in the Indenture.
[AFTER DECEMBER 1, 2009 AND PRIOR TO MATURITY, THE DEBENTURES ARE REDEEMABLE AT
THE OPTION OF THE TRUST AT A PRICE EQUAL TO $1,000 PER $1,000 PRINCIPAL AMOUNT
OF DEBENTURES AND, IN ADDITION THERETO, AT THE TIME OF REDEMPTION, THE TRUST
SHALL PAY TO THE HOLDER ACCRUED AND UNPAID INTEREST AND OTHERWISE ON THE TERMS
AND CONDITIONS DESCRIBED IN THE INDENTURE.] The Trust may, on notice as provided
in the Indenture, at its option and subject to any applicable regulatory
approval, elect to satisfy its obligation to pay all or any portion of the
applicable Redemption Price by the issue of that number of Trust Units obtained
by dividing the applicable Redemption Price by 95% of the weighted average
trading price of the Trust Units on the Toronto Stock Exchange for the 20
consecutive trading days ending on the fifth trading day preceding the
Redemption Date.
Upon the occurrence of a Change of Control of the Trust, the Trust is
required to make an offer to purchase all of the Debentures at a price equal to
101% of the principal amount of such Debentures plus accrued and unpaid interest
(if any) up to, but excluding, the date the Debentures are so repurchased (the
"Offer"). If 90% or more of the principal amount of all Debentures outstanding
on the date the Trust provides notice of a Change of Control to the Debenture
Trustee have been tendered for purchase pursuant to the Offer, the Trust shall
redeem all the remaining outstanding Debentures on the same date and at the same
price.
If a takeover bid for Debentures, within the meaning of the Applicable
Securities Legislation, is made and 90% or more of the principal amount of all
the debentures issued pursuant to the Indenture (other than debentures held at
the date of the takeover bid by or on behalf of the Offeror, Associates or
Affiliates of the Offeror or anyone acting jointly or in concert with the
Offeror) are taken up and paid for by the Offeror, the Offeror will be entitled
to acquire the Debentures of those holders who did not accept the offer on the
same terms as the Offeror acquired the first 90% of the principal amount of the
debentures issued pursuant to the Indenture.
The Trust may, on notice as provided in the Indenture, at its option
and subject to any applicable regulatory approval, elect to satisfy the
obligation to repay all or any portion of the principal amount of this Debenture
due on the Maturity Date by the issue of that number of Freely Tradeable Trust
Units obtained by dividing the principal amount of this Debenture to be paid for
in Trust Units pursuant to the exercise by the Trust of the Unit Repayment Right
by 95% of the weighted average trading price of the Trust Units on the Toronto
Stock Exchange for the 20 consecutive trading days ending on the fifth trading
day preceding the Maturity Date.
The indebtedness evidenced by this Debenture, and by all other
Debentures now or hereafter certified and delivered under the Indenture, is a
direct unsecured obligation of the Trust, and is subordinated in right of
payment, to the extent and in the manner provided in the Indenture, to the prior
payment of all Senior Indebtedness (including any indebtedness to trade
creditors), whether outstanding at the date of the Indenture or thereafter
created, incurred, assumed or guaranteed.
A-4
The principal hereof may become or be declared due and payable before
the stated maturity in the events, in the manner, with the effect and at the
times provided in the Indenture.
The Indenture contains provisions that AOG may, at any time and from
time to time, in its sole discretion, request that the Debenture Trustee make
reasonable efforts, as practicable in the circumstances, to obtain declarations
as to beneficial ownership of Debentures, perform residency searches of holders
of Debentures and beneficial holders of Debentures mailing address lists and
take such other steps specified by AOG to determine or estimate as best possible
the residence of the beneficial owners of Debentures. If at any time the board
of directors of AOG, in its sole discretion, determines that it is in the best
interest of the Trust, AOG may: (i) require the Debenture Trustee to refuse to
accept a subscription for the Debentures from, or issue or register a transfer
of Trust Units to, a person unless the person provides a declaration to AOG that
the Debentures to be issued or transferred to such person will not when issued
or transferred be beneficially owned by a non resident of Canada; (ii) to the
extent practicable in the circumstances, send a notice to registered holders of
the Debentures which are beneficially owned by non-residents of Canada, chosen
in inverse order to the order of acquisition or registration of such Debentures
beneficially owned by non-residents of Canada or in such other manner as AOG may
consider equitable and practicable, requiring them to sell their Debentures
which are beneficially owned by non-residents of Canada or a specified portion
thereof within a specified period of not less than 60 days. If the holders of
Debentures receiving such notice have not sold the specified number of such
Debentures or provided AOG with satisfactory evidence that such Debentures are
not beneficially owned by non-residents within such period, AOG may, on behalf
of such registered holder of Debentures, sell such Debentures and, in the
interim, suspend the rights attached to such Debentures; and (iii) take such
other actions as the board of directors of AOG determines, in its sole
discretion, are appropriate in the circumstances that will reduce or limit the
number of Debentures held by non-residents to ensure that the Trust is not
maintained primarily for the benefit of non-residents of Canada.
The Indenture contains provisions making binding upon all holders of
Debentures outstanding thereunder (or in certain circumstances specific series
of Debentures) resolutions passed at meetings of such holders held in accordance
with such provisions and instruments signed by the holders of a specified
majority of Debentures outstanding (or specific series), which resolutions or
instruments may have the effect of amending the terms of this Debenture or the
Indenture.
The Indenture contains provisions disclaiming any personal liability on
the part of holders of Trust Units, officers and directors of Advantage Oil &
Gas Ltd. or the trustee, manager and other agents of the Trust in respect of any
obligation or claim arising out of the Indenture or this Debenture.
This Debenture may only be transferred, upon compliance with the
conditions prescribed in the Indenture, in one of the registers to be kept at
the principal office of the Debenture Trustee in Calgary, Alberta or Toronto,
Ontario and in such other place or places and/or by such other registrars (if
any) as the Trust with the approval of the Debenture Trustee may designate. No
transfer of this Debenture shall be valid unless made on the register by the
registered holder hereof or his executors or administrators or other legal
representatives, or his or their attorney duly appointed by an instrument in
form and substance satisfactory to the Debenture Trustee or other registrar, and
upon compliance with such reasonable requirements as the Debenture Trustee
and/or other registrar may prescribe and upon surrender of this Debenture for
cancellation. Thereupon a new Debenture or Debentures in the same aggregate
principal amount shall be issued to the transferee in exchange hereof.
This Debenture shall not become obligatory for any purpose until it
shall have been certified by the Debenture Trustee under the Indenture.
Capitalized words or expressions used in this Debenture shall, unless
otherwise defined herein, have the meaning ascribed thereto in the Indenture and
the Supplemental Indenture.
A-5
IN WITNESS WHEREOF ADVANTAGE ENERGY INCOME FUND has caused this
Debenture to be signed by its authorized representatives as of the 14th day of
September, 2004.
ADVANTAGE ENERGY INCOME FUND,
by Advantage Oil & Gas Ltd.
By:
----------------------------
Countersigned by:
COMPUTERSHARE TRUST COMPANY
OF CANADA, as Debenture Trustee
--------------------------------
(FORM OF DEBENTURE TRUSTEE'S CERTIFICATE)
This Debenture is one of the [7.50% EXTENDIBLE CONVERTIBLE UNSECURED
SUBORDINATED DEBENTURES DUE NOVEMBER 1, 2004 (OCTOBER 1, 2009, IF
EXTENDED)/7.75% EXTENDIBLE UNSECURED SUBORDINATED DEBENTURES DUE NOVEMBER 1,
2004 (DECEMBER 1, 2011, IF EXTENDED)] referred to in the Supplemental Indenture
within mentioned.
COMPUTERSHARE TRUST COMPANY OF CANADA
By:
--------------------------------
(Authorized Officer)
(FORM OF REGISTRATION PANEL)
(No writing hereon except by Debenture Trustee or other registrar)
----------------------------------------------------------------------------------------------------------------------
DATE OF REGISTRATION IN WHOSE NAME REGISTERED SIGNATURE OF DEBENTURE TRUSTEE OR REGISTRAR
----------------------------------------------------------------------------------------------------------------------
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto __________________________________, whose address and social insurance
number, if applicable, are set forth below, this Debenture (or $______________
principal amount hereof*) of ADVANTAGE ENERGY INCOME FUND standing in the
name(s) of the undersigned in the register maintained by the Trust with respect
to such Debenture and does hereby irrevocably authorize and direct the Debenture
Trustee to transfer such Debenture in such register, with full power of
substitution in the premises.
Dated:
--------------------------------------------------------
Address of Transferee:
--------------------------------------------------------
(Street Address, City, Province and Postal Code)
Social Insurance Number of Transferee, if applicable: *If less than the full
principal amount of the within Debenture is to be transferred, indicate in the
space provided the principal amount (which must be $1,000 or an integral
multiple thereof, unless you hold a Debenture in a non-integral multiple of
1,000 by reason of your having exercised your right to exchange upon the making
of an Offer, in which case such Debenture is transferable only in its entirety)
to be transferred.
1. The signature(s) to this assignment must correspond with the name(s) as
written upon the face of this Debenture in every particular without
alteration or any change whatsoever. The signature(s) must be
guaranteed by a Canadian chartered bank or trust company or by a member
of an acceptable Medallion Guarantee Program. Notarized or witnessed
signatures are not acceptable as guaranteed signatures. The Guarantor
must affix a stamp bearing the actual words: "SIGNATURE GUARANTEED".
2. The registered holder of this Debenture is responsible for the payment
of any documentary, stamp or other transfer taxes that may be payable
in respect of the transfer of this Debenture.
Signature of Guarantor:
------------------------------ -------------------------------------
Authorized Officer Signature of transferring
registered holder
-----------------------------
Name of Institution
EXHIBIT "1"
TO CDS GLOBAL DEBENTURE
ADVANTAGE ENERGY INCOME FUND
[7.50% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES
DUE NOVEMBER 1, 2004 (OCTOBER 1, 2009, IF EXTENDED)/7.75% EXTENDIBLE
CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES
DUE NOVEMBER 1, 2004 (DECEMBER 1, 2011, IF EXTENDED)
Initial Principal Amount: $________ [CUSIP/ISIN - ▇▇▇▇▇▇▇▇▇/CA00762LAD34]
[CUSIP/ISIN - ▇▇▇▇▇▇▇▇▇/CA00762LAE17]
Authorization: ____________________
ADJUSTMENTS
==========================================================================================================================
DATE AMOUNT OF INCREASE AMOUNT OF DECREASE NEW PRINCIPAL AMOUNT AUTHORIZATION
==========================================================================================================================
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SCHEDULE "B"
TO THE SECOND SUPPLEMENTAL TRUST INDENTURE AMONG
ADVANTAGE ENERGY INCOME FUND,
ADVANTAGE OIL & GAS LTD. AND
COMPUTERSHARE TRUST COMPANY OF CANADA
FORM OF REDEMPTION NOTICE
ADVANTAGE ENERGY INCOME FUND
[7.50% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES]
[7.75% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES]
REDEMPTION NOTICE
To: Holders of [7.50% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED
DEBENTURES/7.75% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED
DEBENTURES] (the "DEBENTURES") of Advantage Energy Income Fund
(the "TRUST")
Note: All capitalized terms used herein have the meaning ascribed thereto
in the Indenture mentioned below, unless otherwise indicated.
Notice is hereby given pursuant to Section 4.3 of the trust
indenture (the "INDENTURE") dated as of July 8, 2003 among the Trust, Advantage
Oil & Gas Ltd. ("AOG") and Computershare Trust Company of Canada (the "DEBENTURE
TRUSTEE") and the second supplemental trust indenture dated as of September 14,
2004 among the Trust, AOG and the Debenture Trustee, that the aggregate
principal amount of $o of the $o of Debentures outstanding will be redeemed as
of o (the "REDEMPTION DATE"), upon payment of a redemption amount of $o for each
$1,000 principal amount of Debentures, being equal to the aggregate of (i) $o
(the "REDEMPTION PRICE"), and (ii) all accrued and unpaid interest hereon to but
excluding the Redemption Date (collectively, the "TOTAL REDEMPTION PRICE").
The Total Redemption Price will be payable upon presentation and
surrender of the Debentures called for redemption at the following corporate
trust office:
COMPUTERSHARE TRUST COMPANY OF CANADA
▇▇▇▇▇ ▇▇▇, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇
The interest upon the principal amount of Debentures called for
redemption shall cease to be payable from and after the Redemption Date, unless
payment of the Total Redemption Price shall not be made on presentation for
surrender of such Debentures at the above-mentioned corporate trust office on or
after the Redemption Date or prior to the setting aside of the Total Redemption
Price pursuant to the Indenture.
[PURSUANT TO SECTION 4.6 OF THE INDENTURE, THE TRUST HEREBY
IRREVOCABLY ELECTS TO SATISFY ITS OBLIGATION TO PAY $O OF THE REDEMPTION PRICE
PAYABLE TO HOLDERS OF DEBENTURES IN ACCORDANCE WITH THIS NOTICE BY ISSUING AND
DELIVERING TO THE HOLDERS THAT NUMBER OF FREELY TRADABLE TRUST UNITS OBTAINED BY
DIVIDING THE REDEMPTION PRICE BY 95% OF THE CURRENT MARKET PRICE OF THE TRUST
UNITS.
B-2
NO FRACTIONAL TRUST UNITS SHALL BE DELIVERED UPON THE EXERCISE BY
THE TRUST OF THE ABOVE-MENTIONED REDEMPTION RIGHT BUT, IN LIEU THEREOF, THE
TRUST SHALL PAY THE CASH EQUIVALENT THEREOF DETERMINED ON THE BASIS OF THE
CURRENT MARKET PRICE OF TRUST UNITS ON THE REDEMPTION DATE (LESS ANY TAX
REQUIRED TO BE DEDUCTED, IF ANY).
IN THIS CONNECTION, UPON PRESENTATION AND SURRENDER OF THE
DEBENTURES FOR PAYMENT ON THE REDEMPTION DATE, THE TRUST SHALL, ON THE
REDEMPTION DATE, MAKE THE DELIVERY TO THE DEBENTURE TRUSTEE, AT THE
ABOVE-MENTIONED CORPORATE TRUST OFFICE, FOR DELIVERY TO AND ON ACCOUNT OF THE
HOLDERS, OF CERTIFICATES REPRESENTING THE FREELY TRADABLE TRUST UNITS TO WHICH
HOLDERS ARE ENTITLED TOGETHER WITH THE CASH EQUIVALENT IN LIEU OF FRACTIONAL
TRUST UNITS, CASH FOR ALL ACCRUED AND UNPAID INTEREST UP TO, BUT EXCLUDING, THE
REDEMPTION DATE, AND, IF ONLY A PORTION OF THE DEBENTURES ARE TO BE REDEEMED BY
ISSUING FREELY TRADABLE TRUST UNITS, CASH REPRESENTING THE BALANCE OF THE
REDEMPTION PRICE.]
DATED:
ADVANTAGE ENERGY INCOME FUND, by
Advantage Oil & Gas Ltd.
-------------------------------------
(Authorized Director or Officer of
Advantage Oil & Gas Ltd.)
SCHEDULE "C"
TO THE SECOND SUPPLEMENTAL TRUST INDENTURE AMONG
ADVANTAGE ENERGY INCOME FUND,
ADVANTAGE OIL & GAS LTD. AND
COMPUTERSHARE TRUST COMPANY OF CANADA
FORM OF MATURITY NOTICE
To: Holders of [7.50% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED
DEBENTURES/7.75% EXTENDIBLE CONVERTIBLE UNSECURED SUBORDINATED
DEBENTURES] (the "DEBENTURES") of Advantage Energy Income Fund
(the "Trust")
Note: All capitalized terms used herein have the meaning ascribed thereto
in the Indenture mentioned below, unless otherwise indicated.
Notice is hereby given pursuant to Section 4.10(b) of the trust
indenture (the "INDENTURE") dated as of July 8, 2003 among the Trust, Advantage
Oil & Gas Ltd. and Computershare Trust Company of Canada, as trustee (the
"DEBENTURE TRUSTEE"), that the Debentures are due and payable as of [OCTOBER 1,
2009/DECEMBER 1, 2011], or on such earlier date as the principal amount hereof
may become due in accordance with the provisions of the second supplemental
trust indenture dated September 14, 2004 among the Trust, Advantage Oil & Gas
Ltd. and Computershare Trust Company of Canada (the "SUPPLEMENTAL DEBENTURE")
(the "MATURITY DATE") and the Trust elects to satisfy its obligation to pay to
holders of the New Debentures (as such term is defined in Supplemental
Debenture) the principal amount of all of the New Debentures outstanding on the
Maturity Date by issuing and delivering to the holders that number of Freely
Tradeable Trust Units equal to the number obtained by dividing such principal
amount of the Debentures by 95% of the Current Market Price of Trust Units on
the Maturity Date.
No fractional Trust Units shall be delivered on exercise by the
Trust of the above mentioned repayment right but, in lieu thereof, the Trust
shall pay the cash equivalent thereof determined on the basis of the Current
Market Price of Trust Units on the Maturity Date (less any tax required to be
deducted, if any).
In this connection, upon presentation and surrender of the
Debentures for payment on the Maturity Date, the Trust shall, on the Maturity
Date, make delivery to the Debenture Trustee, at its principal corporate trust
office in Calgary, Alberta, for delivery to and on account of the holders, of
certificates representing the Freely Tradeable Trust Units to which holders are
entitled together with the cash equivalent in lieu of fractional Trust Units,
cash for all accrued and unpaid interest up to, but excluding, the Maturity Date
and if only a portion of the Debentures are to be repaid by issuing Freely
Tradeable Trust Units, cash representing the balance of the principal amount and
premium (if any) due on the Maturity Date.
DATED:
ADVANTAGE ENERGY INCOME FUND, by
Advantage Oil & Gas Ltd.
---------------------------------------------
(Authorized Director or Officer of
Advantage Oil & Gas Ltd.)
SCHEDULE "D"
TO THE SECOND SUPPLEMENTAL TRUST INDENTURE AMONG
ADVANTAGE ENERGY INCOME FUND,
ADVANTAGE OIL & GAS LTD. AND
COMPUTERSHARE TRUST COMPANY OF CANADA
FORM OF NOTICE OF CONVERSION
CONVERSION NOTICE
TO: ADVANTAGE ENERGY INCOME FUND
Note: All capitalized terms used herein have the meaning ascribed thereto
in the Indenture mentioned below, unless otherwise indicated.
The undersigned registered holder of [7.50 EXTENDIBLE CONVERTIBLE
UNSECURED SUBORDINATED DEBENTURES/7.75% EXTENDIBLE CONVERTIBLE UNSECURED
SUBORDINATED DEBENTURES] bearing Certificate No. irrevocably elects to
convert such Debentures (or $ principal amount thereof*) in accordance
with the terms of the Indenture referred to in such Debentures and tenders
herewith the Debentures, and, if applicable, directs that the Trust Units of
Advantage Energy Income Fund issuable upon a conversion be issued and delivered
to the person indicated below. (If Trust Units are to be issued in the name of a
person other than the holder, all requisite transfer taxes must be tendered by
the undersigned).
Dated:
--------------------- ---------------------------------
(Signature of Registered Holder)
* If less than the full principal amount of the Debentures, indicate in the
space provided the principal amount (which must be $1,000 or integral
multiples thereof).
NOTE: If Trust Units are to be issued in the name of a person other than the
holder, the signature must be guaranteed by a chartered bank, a trust
company or by a member of an acceptable Medallion Guarantee Program. The
Guarantor must affix a stamp bearing the actual words: "SIGNATURE
GUARANTEED".
(Print name in which Trust Units are to be issued, delivered and registered)
Name:
------------------------------------
---------------------------------------------
(Address)
---------------------------------------------
(City, Province and Postal Code)
Name of guarantor:
------------------------------
Authorized signature:
----------------------------
