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EXHIBIT 10.61
SECOND SUPPLEMENT TO PURCHASE AGREEMENT
THIS SECOND SUPPLEMENT TO PURCHASE AGREEMENT dated as of September 8,
2000 (this "Supplement"), is made by:
o TransTexas Gas Corporation, a Delaware corporation (herein
called "Grantor"),
o Southern Producer Services, L.P. ("SPS"),
o TCW Portfolio No. 1555 DR V Sub-Custody Partnership, L.P.
("Fund V") and TCW DR VI Investment Partnership, L.P. ("Fund
VI"), acting through their agent, TCW Asset Management
Company, and
o TCW Asset Management Company, as Agent on behalf of Fund V and
Fund VI (in such capacity, "Funds Agent").
RECITALS
1. Grantor, SPS, Fund V, Fund VI and Funds Agent have heretofore
entered into that certain Purchase Agreement dated as of March 14, 2000 (herein,
as heretofore amended or supplemented, called the "Original Purchase
Agreement"), and, as contemplated therein, Grantor has, by means of a Production
Payment Conveyance dated as of the same date (herein, as heretofore amended or
supplemented, called the "Original Conveyance"), conveyed to SPS, Fund V and
Fund VI (collectively, "Grantee") the "Production Payment" as therein defined,
burdening interests of Grantor in certain oil and gas properties.
2. As contemplated in the Original Purchase Agreement, Grantor now
desires to supplement and amend the Original Conveyance in consideration of the
payment by SPS of an additional Purchase Price Payment, as more fully described
below.
3. Section 2.3(b) of the Original Purchase Agreement provides that
Grantor can offer to make additional Production Units subject to the Production
Payment in consideration of the payment by SPS of an additional Purchase Price
Payment to Grantor.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, Grantor, SPS, Fund V, Fund VI, and
Funds Agent hereby agree as follows:
ARTICLE I - Definitions and References
Section 1.1. Defined Terms and References. As used herein, the terms
"Original Conveyance", "Original Purchase Agreement", "Grantor", "SPS", "Fund
V", "Fund VI", "Grantee" and "Funds Agent" have the meanings given them above.
Reference is also made to the Original Purchase Agreement and to the Original
Conveyance for the meaning of various terms defined therein, all of which shall
when used herein (unless otherwise expressly defined herein)
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have the same meanings. For purposes of this Supplement, unless the context
otherwise requires, the following additional terms shall have the following
meanings:
"Current Closing Date" has the meaning given such term in Section 2.3.
"Current Conveyance Supplement" means the Second Supplement to
Production Payment Conveyance executed by Grantor and Grantee substantially in
the form of Exhibit A hereto.
"Current Purchase Price Payment" means a Purchase Price Payment in the
amount of $10,000,000.
"Current Supplement Documents" means this Supplement, the Current
Conveyance Supplement, and all other Production Payment Documents delivered
substantially contemporaneously herewith.
"Production Payment Conveyance" means the Original Conveyance as
amended and supplemented by the Current Conveyance Supplement.
"Purchase Agreement" means the Original Purchase Agreement as
supplemented and amended hereby.
Section 1.2. Rules of Construction. All references in this Supplement
to articles, sections, subsections and other subdivisions refer to corresponding
articles, sections, subsections and other subdivisions of this Supplement unless
expressly provided otherwise. Titles appearing at the beginning of any of such
subdivisions are for convenience only and shall not constitute part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions. The words "this Supplement, "this instrument", "herein",
"hereof", "hereby", "hereunder" and words of similar import refer to this
Supplement as a whole and not to any particular subdivision unless expressly so
limited. Unless the context otherwise requires: "including" (and its grammatical
variations) means "including without limitation"; "or" is not exclusive; words
in the singular form shall be construed to include the plural and vice versa;
words in any gender include all other genders; references herein to any
instrument or agreement refer to such instrument or agreement as it may be from
time to time supplemented or amended; and references herein to any Person
include such Person's successors and assigns. All references in this Supplement
to exhibits and schedules refer to the exhibits and schedules to this Supplement
unless expressly provided otherwise, and all such exhibits and schedules are
hereby incorporated herein by reference and made a part hereof for all purposes.
ARTICLE II - Amendment
Section 2.1. Agreement to Amend. Upon the terms and conditions of this
Supplement and the Purchase Agreement, Grantor and Grantee agree to amend and
supplement the Original Conveyance by executing and delivering the Current
Conveyance Supplement.
Section 2.2. Closing. On the Current Closing Date, Grantor shall
deliver the Current Supplement Documents to Grantee, Grantor shall satisfy all
of the conditions set out in
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Sections 3.4 and 3.5 of the Purchase Agreement, and the following additional
condition shall be satisfied:
o Grantor shall provide Grantee with subordination instruments,
in form and substance satisfactory to Grantee, from any
Persons holding liens or security interests on the properties
described in the Current Conveyance Supplement.
Thereupon, SPS shall pay all of the Current Purchase Price Payment to Grantor in
accordance with the terms and procedures of the Purchase Agreement.
Section 2.3. Time and Place of Closing. The closing for the
consummation of the transactions contemplated herein shall take place on
September 8, 2000 or on such other date as may be agreed to by Grantor and
Grantee (herein called the "Current Closing Date").
Section 2.4. Waiver of Conditions. Section 3.4 of the Original Purchase
Agreement specifies various conditions for the payment of the Current Purchase
Price Payment. Grantee hereby waives, with respect to the Current Purchase Price
Payment only, the conditions set out in subsections (b), (d), (e), (f), (g) and
(k) of Section 3.4 of the Original Purchase Agreement.
Section 2.5. Waiver of Covenant. Pursuant to the Current Conveyance
Supplement, the "Additional Subject Interests" (as defined therein and herein so
called) are being made subject to the Production Payment Conveyance. Section
3.2(a)(ii) of the Production Payment Conveyance allows Grantor to abandon any
Subject Well (along with the associated Subject Interests) if, after it has
become a Commercial Well, it then ceases to be a Commercial Well. Grantee hereby
agrees, in connection with the Additional Subject Interests only, that Grantor
may abandon any such Additional Subject Interest if there is no Commercial Well
located thereon, regardless of whether any Subject Well located thereon had ever
become a Commercial Well.
ARTICLE III - Representations and Covenants
Section 3.1. Representations and Warranties of Grantor. To induce
Grantee to enter into the Current Supplement Documents and to pay the Current
Purchase Price Payment, Grantor hereby represents and warrants and covenants to
Grantee that:
(a) All representations and warranties made by Grantor or any other
TransTexas Company in any Production Payment Document now or previously
delivered are true and correct as of the Current Closing Date (unless such
representations and warranties are expressly limited to an earlier date, in
which case such representations and warranties are true and correct as of such
earlier date). Without limitation of the foregoing, no Senior Notes Event of
Default exists.
(b) Each TransTexas Company has performed all agreements, covenants,
and conditions which it is required by any Production Payment Document to
perform on or prior to the Current Closing Date.
(c) The consummation on the Current Closing Date of the transactions
contemplated in the Current Supplement Documents: (i) is not prohibited by any
law or any regulation or order
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of any court or governmental agency or authority applicable to Grantor or any
other TransTexas Company, and (ii) does not subject any of them to any penalty
or other onerous condition under or pursuant to any such law, regulation or
order.
(d) Grantor has paid in full in cash all costs associated with drilling
(including completing or plugging and abandoning) each well located on any
"Additional Subject Lands" as defined in the Current Conveyance Supplement. Upon
production in paying quantities from such Additional Subject Lands, Grantor will
enter into appropriate amendments to the TransTexas Marketing Agreements and
such related documentation as Marketer reasonable requests.
Section 3.2. Covenants. To induce Grantee to enter into the Current
Supplement Documents and to pay the Current Purchase Price Payment, Grantor
hereby covenants with Grantee that Grantor will perform all of its covenants and
duties under the Production Payment Documents, all as fully as if they were set
out in full herein.
Section 3.3. Representations and Warranties of Grantee. Each Person
included within Grantee hereby represents and warrants to Grantor that: (a) such
Person has incurred no obligation or liability, contingent or otherwise, for
broker's or finder's fees in respect of any of the matters provided for in this
Supplement for which fees Grantor might be liable; (b) the Purchase Agreement
constitutes the legal, valid and binding act and obligation of such Person,
enforceable against such Person in accordance with its terms except as such
enforcement may be limited by bankruptcy, insolvency, moratorium and other
similar laws applicable to creditors' rights generally or by general principles
of equity; (c) no bankruptcy or insolvency proceeding is presently pending (or,
to such Person's best knowledge, threatened) by or against such Person under any
applicable bankruptcy, insolvency or other similar law of any jurisdiction; (d)
such Person has not made a general assignment for the benefit of creditors; (e)
such Person is acquiring the Production Payment for its own account and not with
any intention to transfer all or any part of the Production Payment to others in
violation of the Securities Act of 1933, as amended, or any other applicable
securities laws, and (f) such Person is a "United States person", within the
meaning of Section 7701 of the Internal Revenue Code of 1986, as amended. Fund V
and Fund VI further represent and warrant that in connection with the
transactions contemplated herein and in the Purchase Agreement (i) they are
represented by Funds Agent, an investment manager that qualifies as a "qualified
professional asset manager" as defined in Department of Labor Prohibited
Transaction Exemption 00-00 (xxx "XXXX Xxxxxxxxx") and (ii) each of the
conditions of the QPAM Exemption are satisfied and will, throughout the term of
the Purchase Agreement (as hereby supplemented and amended), be satisfied.
ARTICLE IV - Miscellaneous
Section 4.1. Ratification of Production Payment Documents. The Original
Purchase Agreement as hereby supplemented and amended is hereby ratified and
confirmed in all respects. The other Production Payments Documents, as they may
be supplemented, amended or affected by the Current Supplement Documents, are
hereby ratified and confirmed in all respects. Any reference to the Purchase
Agreement in any Production Payment Document shall be deemed to refer to this
Supplement also, and any reference in any Production Payment Document to any
other document or instrument amended, renewed, extended or otherwise affected by
any Current
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Supplement Document shall also refer to such Current Supplement Document. The
execution, delivery and effectiveness of this Supplement and the other Current
Supplement Documents shall not, except as expressly provided herein or therein,
operate as a waiver of any right, power or remedy of Grantee or Funds Agent
under the Purchase Agreement or any other Production Payment Document nor
constitute a waiver of any provision of the Purchase Agreement or any other
Production Payment Document.
Section 4.2. Survival of Agreements. All representations, warranties,
covenants and agreements of Grantor herein shall survive the execution and
delivery of this Supplement and the other Current Supplement Documents and shall
further survive until terminated in accordance with the Purchase Agreement.
Section 4.3. Production Payment Documents. This Supplement and the
other Current Supplement Documents are Production Payment Documents, and all
provisions in the Purchase Agreement pertaining to Production Payment Documents
(including the arbitration provisions of Section 6.9 of the Purchase Agreement)
apply hereto and thereto.
THIS WRITTEN AGREEMENT AND THE OTHER PRODUCTION PAYMENT DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Section 4.4. Governing Law. This Supplement shall be deemed a contract
and instrument made under the laws of the State of Texas and shall be construed
and enforced in accordance with and governed by the laws of the State of Texas
and the laws of the United States of America, without regard to principles of
conflicts of law.
Section 4.5. Counterparts. This Supplement may be separately executed
in counterparts and by the different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Supplement.
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IN WITNESS WHEREOF, this Supplement is executed as of the date first
written above.
TRANSTEXAS GAS CORPORATION
By: /s/ XX XXXXXXX
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Xx Xxxxxxx
Vice President
SOUTHERN PRODUCER SERVICES, L.P.
BY: SC Ashwood Holdings, Inc.,
its general partner
By: /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
Vice President
TCW PORTFOLIO NO. 1555 DR V SUB-CUSTODY
PARTNERSHIP, L.P. and
TCW DR VI INVESTMENT PARTNERSHIP, L.P.
By: TCW ASSET MANAGEMENT COMPANY, as
their Agent
By: /s/ XXXX X. XXXXXX
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Xxxx X. Xxxxxx
Senior Vice President
TCW ASSET MANAGEMENT COMPANY, as Agent
By: /s/ XXXX X. XXXXXX
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Xxxx X. Xxxxxx
Senior Vice President
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ACKNOWLEDGMENT
To induce Grantee to enter into the above Supplement, the undersigned
Galveston Bay Pipeline Company and Galveston Bay Processing Company each hereby
ratify and confirm their various agreements made in connection with the
Production Payment Documents referred to above and acknowledge and agree that
such agreements remain in full force and effect after taking into account the
Current Supplement Documents referred to above.
EXECUTED as of September 8, 2000.
GALVESTON BAY PIPELINE COMPANY
By: /s/ XX XXXXXXX
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Name: Xx Xxxxxxx
Title: Vice President
GALVESTON BAY PROCESSING COMPANY
By: /s/ XX XXXXXXX
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Name: Xx Xxxxxxx
Title: Vice President
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EXHIBIT A
CURRENT CONVEYANCE SUPPLEMENT
