54
respect of Block 9 in Iraq or other assets, or obtain funding to execute the Group’s exploration, appraisal and
development programmes.
A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or
withdrawal by the rating agency at any time. No assurance can be given that a credit rating will remain constant for any
given period of time or that a credit rating will not be lowered or withdrawn entirely by the credit rating agency if, in its
judgment, circumstances in the future so warrant. A suspension, reduction or withdrawal at any time of the credit rating
assigned to the Notes by S&P, Fitch or other credit rating agencies, or a reduction in outlook by Moody’s, Fitch or other
credit rating agencies, may adversely affect the cost and terms and conditions of the Group’s financings and could
adversely affect the value and trading of the Notes.
Many of the covenants in the Indenture will be suspended if the Notes are rated investment grade by two of the credit
rating agencies of Moody’s, Standard and Poor’s (“S&P”) and/or Fitch.
Many of the covenants in the Indenture will be suspended if the Notes are rated investment grade with a stable outlook
by two of the three credit agencies of Moody’s, S&P and/or Fitch provided at such time no default under the Indenture
has occurred and is continuing. There can be no assurance that the Notes will ever be rated investment grade, or if they
are rated investment grade, that the Notes will maintain such ratings. If on any date following the Issue Date the Notes
are assigned an investment grade rating from two of the credit rating agencies of Moody’s, S&P and/or Fitch and no
default shall have occurred and be continuing, then the following provisions of the Indenture, as described in the
“
Description of the Notes – Certain Covenants
,” will not apply to the Notes: “—
Restricted payments
”; “—
Dividend and
other Payment Restrictions Affecting Subsidiaries
”; “—
Incurrence of Indebtedness and Issuance of Preferred Stock
”;
“—
Transactions with Affiliates
”; clause (5) of the second paragraph of the covenant entitled “—
Merger, consolidation
or Sale of Assets
”; “
— Limitation on Guarantees of Indebtedness by Restricted Subsidiaries
”; “—
Designation of
Restricted and Unrestricted Subsidiaries”;
and the provision “
Description of Notes – Repurchase at the Option of
Noteholders – Asset Sales
.” If and while the Issuer and the Restricted Subsidiaries are not subject to these suspended
covenants, the Notes will be entitled to substantially less covenant protection. In the event that the Issuer and the
Restricted Subsidiaries are not subject to these suspended covenants under the Indenture for any period of time as a
result of the foregoing, and on any subsequent date one or both of the rating agencies withdraw their investment grade
rating or downgrade the rating assigned to the Notes below an investment grade rating, then the Issuer and the Restricted
Subsidiaries will thereafter again be subject to these suspended covenants under the Indenture with respect to future
events. Upon the occurrence of a suspension of covenants, the amount of excess proceeds from net proceeds shall be
reset to zero.
Notwithstanding the foregoing, in the event of any such reinstatement, no action taken or omitted to be taken by the
Issuer or any Restricted Subsidiary prior to such reinstatement will give rise to a default under the Indenture with respect
to the Notes, provided that: (i) with respect to restricted payments made after such reinstatement, the amount available to
be made as restricted payments will be calculated as though the covenant described under “
Description of Notes—
Certain Covenants—Restricted Payments
” had been in effect prior to, but not during, the suspension period; and (ii) all
indebtedness incurred, or disqualified stock or preferred stock issued, during the suspension period will be classified to
have been incurred or issued pursuant to clause (2) of the second paragraph of “
Description of Notes—Certain
Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock.
” See “
Description of Notes—Certain
Covenants—Suspension of Covenants when Notes Rated Investment Grade
.”
The Notes will initially be held in book-entry form, and therefore you must rely on the procedures of the relevant
clearing systems to exercise any rights and remedies.
Owners of the book-entry interests will not be considered owners or Noteholders unless and until definitive notes are
issued in exchange for book-entry interests. Instead, the nominee of the common depositary for Euroclear and
Clearstream (or its nominee) will be the sole registered Noteholder in global form. Payments of principal, interest and
other amounts owing on or in respect of the Notes in global form will be made to Citibank, N.A., London Branch, the
Paying Agent, which will make payments to Euroclear and Clearstream. Thereafter, such payments will be credited to
Euroclear and Clearstream participants’ accounts, as applicable, that hold book-entry interests in the Notes in global
form and credited by such participants to indirect participants. After payment to Euroclear and Clearstream, none of the
Issuer, the Trustee or any paying agent will have any responsibility or liability for any aspect of the records relating to or
payments of interest, principal or other amounts to Euroclear and Clearstream or to owners of book-entry interests.
Accordingly, if you own a book-entry interest in the Notes, you must rely on the procedures of Euroclear and
Clearstream or, if you are not a participant in Euroclear and Clearstream, on the procedures of the participant through
which you own your interest, to exercise any rights and obligations of a Noteholder under the Indenture. Owners of
book-entry interests will not have the direct right to act upon the Group’s solicitations for consents or requests for
waivers or other actions from Noteholders, including enforcement of security for the Notes and the Note Guarantees.
Instead, if you own a book-entry interest, you will be reliant on the common depositary for Euroclear and Clearstream or
its nominee (as the registered Noteholder) to act on your instructions and/or will be permitted to act directly only to the
