LETTER AMENDMENT NO. 7
As of December 31, 1999
The Prudential Insurance Company
of America
U.S. Private Placement Fund
c/o Prudential Capital Group
0000 Xxxx Xxxxxx, Xxxxx 0000X
Xxxxxx, Xxxxx 00000
Ladies and Gentlemen:
We refer to the Master Shelf Agreement dated as of April 17,
1997, as amended by Letter Amendment No. 1 dated March 31, 1998, Letter
Amendment No. 2 dated as of June 30, 1998, Letter Amendment No. 3 dated as of
October 30, 1998, Letter Amendment No. 4 dated as of March 25, 1999, Letter
Amendment No. 5 dated as of June 29, 1999 and Letter Amendment No. 6 dated as of
September 30, 1999 (as amended, the "Agreement"), among the undersigned,
TransMontaigne Inc., formerly known as TransMontaigne Oil Company, (the
"Company"), and The Prudential Insurance Company of America ("Prudential") and
U.S. Private Placement Fund (collectively, the "Purchasers"). Unless otherwise
defined herein, the terms defined in the Agreement shall be used herein as
therein defined.
The Company has requested that the Agreement be amended to
permit the sale of all of the stock of Bear Paw Energy Inc. The Company also has
advised you that Events of Default under paragraphs 6A(1) and 6A(4) of the
Agreement occurred as of December 31, 1999 and an Event of Default under
paragraph 6A(5) of the Agreement may have occurred as of December 31, 1999 and
has requested a temporary waiver of such Events of Default, effective only until
February 22, 2000. You have indicated your willingness to so agree. Accordingly,
it is hereby agreed by you and us as follows:
1. Amendments to the Agreement. The Agreement is, effective as of the date
first above written, hereby amended as follows:
(a) Xxxxxxxxx 0X. Required Prepayments. Paragraphs 4 and 4A are
amended in their entirety to read as follows:
"4. PREPAYMENTS. The Notes shall be subject to prepayment with respect
to any required prepayment as set forth in such Notes as provided in
paragraph 4A(1) and as set forth in paragraph 4A(2) and with respect
to the optional prepayments permitted by paragraph 4B.
4A. Required Prepayments. The Notes of each Series shall be subject to
required prepayments as set forth in paragraphs 4A(1) and 4A(2).
4A(1). Scheduled Prepayments. The Notes of each Series shall be
subject to required prepayments, if any, set forth in the Notes of
such Series, provided, that upon any partial prepayment of the Notes
of any Series pursuant to paragraph 4A(2), the principal amount of
each required prepayment of the Notes of such Series becoming due
under this paragraph 4A(1) on and after the date of such prepayment
shall be reduced by a percentage equal to the product of (a) 100 and
(b) the quotient arrived at by dividing the principal portion of the
Notes of such Series so prepaid by the total principal amount of the
Notes of such Series outstanding immediately prior to such prepayment.
4A(2). Sale of Bear Paw Energy Inc. If the Company sells all of the
stock or substantially all of the assets of Bear Paw Energy Inc.
pursuant to paragraph 6C(5)(v), then on the closing date of such sale,
the Company shall prepay the Series A Notes in an amount equal to
$25,000,000, together with interest thereon to the prepayment date and
the Yield-Maintenance Amount, if any, with respect to the principal
amount of Notes being so prepaid. The Company shall give the holders
of the Notes at least three Business Days prior notice of its
intention to prepay the Notes pursuant to this paragraph 4A(2),
specifying the date of payment and the amount of interest and
Yield-Maintenance Amount, if any, to be paid with such prepayment."
(b) Paragraph 6A. Certain Financial Tests. Effective as of January 13,
2000, a Paragraph 6A(6) is added to the Agreement immediately following
paragraph 6A(5), reading in its entirety as follows:
"6A(6) Consolidated Net Total Liabilities. The Company will not permit
at any time the Consolidated Net Total Liabilities of the Company and
its Subsidiaries to exceed $85,000,000."
(c) Paragraph 6C(5). Merger, Consolidation and Disposition of Assets.
Paragraph 6C(5) is amended by adding immediately following clause (iv) thereof a
new clause (v) reading in its entirety as follows:
"(v) The Company may, no later than January 31, 2000, sell all of the
stock or substantially all of the assets of Bear Paw Energy Inc. for
not less than $120,000,000 in Net Sale Proceeds; provided, that a
portion of the Net Sale Proceeds of such sale shall be applied to
prepay $25,000,000 of the principal of the Notes pursuant to paragraph
4A(2) and the remainder of such Net Sale Proceeds shall be applied to
prepay the principal of the Indebtedness of the Company permitted by
clause (xii) of paragraph 6C(2), any related breakage costs and a
prepayment premium in an amount equal to one-half of one percent
(0.50%) of the principal amount of such Indebtedness prepaid."
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(d) Paragraph 7A. Acceleration. Paragraph 7A is amended by amending
clause (v) in its entirety to read as follows:
"(v) the Company fails to perform or observe any term, covenant or
agreements contained in xxxxxxxxxx 0X(x), 0X, 0X, 0X, 0X, 0X(0),
0X(0), 0X(0), 6C(4), 6C(5), 6C(6) or 6F; or"
(e) Paragraph 10B. Other Terms. Paragraph 10B of the Agreement is
amended by adding the following new definitions in alphabetical order:
"Consolidated Net Total Liabilities" means on any date the difference
(which may be a negative number) of (a) the Consolidated Total
Liabilities on such date of the Company and its Subsidiaries,
including therein, without limitation, the outstanding principal
amount, if any, of the "Revolving Loan" and the "Swingline Loan" and
the outstanding "Letter of Credit Exposure" (each as defined in the
Bank Agreement) under the Bank Agreement and excluding therefrom all
Indebtedness of the Company and its Subsidiaries to the extent that
such Indebtedness is secured by moneys available to be drawn under a
Letter of Credit (as defined in the Bank Agreement), minus (b) the
Consolidated Current Assets of the Company and its Subsidiaries as of
such date; provided that for purposes of clause (b) of this
definition, Consolidated Current Assets shall include cash and Cash
Equivalents.
"Net Sale Proceeds" means, with respect to the sale of stock or
substantially all of the assets of Bear Paw Energy Inc. permitted by
paragraph 6C(5)(v), the cash proceeds received by the Company and its
Subsidiaries on the closing date of such sale (including the portion
attributable to growth capital expenditures made since June 30, 1999),
without reference to any working capital adjustment required to be
made on a post-closing basis, less reasonable transaction costs of the
Company and its Subsidiaries paid from the proceeds of such sale
(which costs shall not exceed $500,000).
1. Consent of Guarantors. Each Guarantor under the Guaranty contained in
paragraph 11 of the Agreement hereby consents to this letter amendment and
hereby confirms and agrees that the Guaranty is, and shall continue to be,
in full force and effect and is hereby confirmed and ratified in all
respects except that, upon the effectiveness of, and on and after the date
of, said letter amendment, all references in the Guaranty to the Agreement,
"thereunder", "thereof", or words of like import referring to the Agreement
shall mean the Agreement as amended by said letter amendment.
2. Consent of Pledgors. Each of the Company, TransMontaigne Transportation
Services Inc., TransMontaigne Product Services Inc. and TransMontaigne
Pipeline Inc. is a Pledgor under the Pledge Agreement (the "Pledgors"), and
each hereby agrees that (i) the Pledge
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Agreement shall continue to be, in full force and effect and is hereby
confirmed and ratified in all respects except that, upon the effectiveness
of, and on and after the date of, this letter amendment, all references in
the Pledge Agreement to the Loan Documents shall mean the Loan Documents as
amended by this Amendment and (ii) all of the Loan Security described
therein does, and shall continue to, secure the payment by the Pledgors of
their obligations under the Loan Documents, as amended by this letter
amendment.
3. Waiver. Effective as of the date hereof, any Event of Default under
paragraphs 6A(1), 6A(4) or 6A(5) of the Agreement existing on December 31,
1999 or for the period ending on December 31, 1999 is hereby waived, except
that such waiver shall lapse and be of no further force and effect as of
the close of business, Denver time, on February 22, 2000.
4. Additional Credit Security. As soon as possible, each of the Company and
its Subsidiaries (excluding Bear Paw Energy Inc.) shall enter into a
security agreement granting to the Collateral Agent on behalf of the
holders of the Notes and on behalf of the lenders under the Bank Agreement
a security interest in all of the accounts, inventory, general intangibles
and other personal property of the Company and such Subsidiaries, in which
security agreement the Company and such Subsidiaries shall agree, among
other things, to perfect such security interests as soon as possible and to
convey to the Collateral Agent acting in such capacity deeds of trust
and/or mortgages on all of their real property; and such agreement shall be
satisfactory in form and substance to the Collateral Agent and the Required
Holder(s) and accompanied by such corporate certificates and legal opinions
as the Collateral Agent or the Required Holder(s)shall require. The Loan
Security granted thereunder shall be shared on a parity basis between the
Obligations and the Bank Obligations in the same manner as currently
provided in the Intercreditor Agreement.
5. Release of Bear Paw. Upon the sale of all of the stock or substantially all
of the assets of Bear Paw Energy Inc. as permitted by clause (v) of
paragraph 6C(5) of the Agreement as amended hereby, the Collateral Agent
shall return to the Company the stock certificate representing the
Company's ownership of 10,000 shares of the common stock of Bear Paw Energy
Inc. being held as security under the Pledge Agreement, and Bear Paw Energy
Inc. shall be released as a Guarantor under the Agreement as amended
hereby. The Purchasers shall provide such written evidence or
acknowledgment of such releases as the Company may reasonably request.
6. Representations and Warranties. In order to induce you to enter into this
letter amendment, each of the Obligors hereby represents and warrants that
each of the representations and warranties contained in paragraph 8 of the
Agreement, is true and correct on the date hereof and that you have been
provided an accurate and complete copy (including exhibits) of the
Agreement and Plan of Merger dated December 27, 1999 among Bear Paw Energy
Inc., the Company and BPE Acquisition, LLC and that such agreement is in
full force and effect.
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7. Miscellaneous.
(a) Effect on Agreement. On and after the effective date of this letter
amendment, each reference in the Agreement to "this Agreement",
"hereunder", "hereof", or words of like import referring to the Agreement,
each reference in the Notes to "the Agreement", "thereunder", "thereof", or
words of like import referring to the Agreement, and each reference in the
Pledge Agreement to "the Shelf Agreement" "thereunder", "thereof", or words
of like import referring to the Agreement, shall mean the Agreement as
amended by this letter amendment. The Agreement, as amended by this letter
amendment, is and shall continue to be in full force and effect and is
hereby in all respects ratified and confirmed. The execution, delivery and
effectiveness of this letter amendment shall not, except as expressly
provided herein, operate as a waiver of any right, power or remedy under
the Agreement nor constitute a waiver of any provision of the Agreement.
This letter amendment shall be a Loan Document.
(b) Counterparts. This letter amendment may be executed in any number of
counterparts (including those transmitted by facsimile) and by any
combination of the parties hereto in separate counterparts, each of which
counterparts shall be an original and all of which taken together shall
constitute one and the same letter amendment. Delivery of this letter
amendment may be made by facsimile transmission of a duly executed
counterpart copy hereof.
(c) Effectiveness. This letter amendment shall become effective as of the
date first above written when and if each of the conditions set forth in
this subparagraph (c) shall have been satisfied.
(I) Executed Counterparts. Counterparts of this letter amendment shall
have been executed by the Company, each Guarantor, each Pledgor and
you.
(II) No Default or Event of Default. After giving effect the
amendments and waivers effected hereby, no Default or Event of Default
under the Agreement shall have occurred and be continuing.
(III) Bank Agreement. The Bank Agreement shall have been amended and
waived to reflect the amendments and waivers to the Agreement made
herein, such amendment and waiver to be satisfactory in form and
substance to you, and in connection with such amendments and waivers
to the Bank Agreement, no payment of any amount and no increase in, or
additional types of, the rate of interest, breakage costs or any other
fees, costs, expenses or other amounts payable with respect to the
Bank Agreement, shall have been made in consideration of such
amendments and waivers other than the 0.50% prepayment premium to be
paid under the Bank Agreement in connection with the sale of Bear Paw
Energy Inc. as contemplated by paragraph 6C(5) as amended hereby and
costs and expenses related to such amendments and waivers.
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(d) Expenses. The Company confirms its agreement, pursuant to paragraph 12B
of the Agreement, to pay promptly all expenses of the Purchasers related to
this letter amendment and all matters contemplated by this letter
amendment, including without limitation all fees and expenses of the
Purchasers' special counsel and any local or other counsel retained by the
Collateral Agent.
(e) Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
LAW OF THE STATE OF NEW YORK.
[Remainder of page intentionally left blank; signature pages follows]
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If you agree to the terms and provisions hereof, please evidence
your agreement by executing and returning at least a counterpart of this
letter amendment to TransMontaigne Inc., 000 00xx Xxxxxx, Xxxxx 0000,
Xxxxxx, Xxxxxxxx 00000, Attention of Xxxxxx X. Xxxxx, Xx.
Very truly yours,
TRANSMONTAIGNE INC.
(f/k/a TransMontaigne Oil Company)
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxx X. Xxxxxxxx, President
Guarantors/Pledgors
TRANSMONTAIGNE PRODUCT SERVICES
MIDWEST INC. (f/k/a TransMontaigne Product
Services Inc.)
TRANSMONTAIGNE PIPELINE INC.
TRANSMONTAIGNE TERMINALING INC.
TRANSMONTAIGNE TRANSPORTATION SERVICES INC.
BEAR PAW ENERGY INC.
TRANSMONTAIGNE PRODUCT SERVICES INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxx X. Xxxxxxxx,
Chief Executive Officer of each of the
foregoing corporations
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Agreed as of the date first above written:
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: /s/ Xxx X. Xxxx
---------------------------
Xxx X. Xxxx, Vice President
U.S. PRIVATE PLACEMENT FUND
By: Prudential Private Placement
Investors, L.P., Investment Advisor
By: Prudential Private Placement
Investors, Inc., its General Partner
By: Xxx X. Xxxx
-----------------------------
Xxx X. Xxxx, Vice President
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