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EXHIBIT 4.20
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TRANSAMERICAN REFINING CORPORATION
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FIRST AMENDMENT TO DISBURSEMENT AGREEMENT
Dated as of December 30, 1997
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This First Amendment to Disbursement Agreement (this "First Amendment")
is made as of December 30, 1997, by and between TransAmerican Energy
Corporation, a Delaware corporation ("TEC"), TransAmerican Refining Corporation,
a Texas corporation ("TARC"), Firstar Bank of Minnesota, N.A. (the "Trustee"),
Firstar Bank of Minnesota, N.A., as security intermediary and disbursement agent
(the "Disbursement Agent"), and Xxxxx & X'Xxxxx, Inc.
WHEREAS, TEC and the Trustee have entered into an Indenture dated as of
June 13, 1997 (the "Indenture"), pursuant to which TEC issued $475,000,000
aggregate principal amount of its 11 1/2% Senior Secured Notes due 2002 and
$1,130,000,000 aggregate principal amount of its 13% Senior Secured Discount
Notes due 2002 (collectively, the "Notes"); and
WHEREAS, TEC and TARC have entered into a Loan Agreement dated as of
June 13, 1997 (the "TARC Intercompany Loan Agreement"), pursuant to which TEC
agreed to lend to TARC an aggregate of $675,648,920 out of the proceeds of the
issuance of the Notes; and
WHEREAS, in connection with the TARC Intercompany Loan Agreement, TEC,
TARC, the Trustee, the Disbursement Agent, and Xxxxx & O'Brien, Inc., as
construction supervisor (the "Construction Supervisor"), have entered into a
Disbursement Agreement dated as of June 13, 1997 (the "TARC Disbursement
Agreement"); and
WHEREAS, TEC, TARC, the Trustee, the Disbursement Agent and the
Construction Supervisor have agreed to certain amendments to the TARC
Disbursement Agreement as hereinafter set forth (the "Proposed Amendments"); and
WHEREAS, pursuant to Section 9.2 of the Indenture, the holders of not
less than 66-2/3% in aggregate Value (as defined in the Indenture) of the Notes
have consented to the Proposed Amendments to the TARC Disbursement Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this First
Amendment hereby agree as follows:
ARTICLE I
AMENDMENTS TO TARC DISBURSEMENT AGREEMENT
Section 1.01. Amended Definitions. The following definitions in Section
1.1 of the TARC Disbursement Agreement are hereby amended to read in their
respective entireties as follows:
"Accounts" means the TARC Disbursement Account, the TEC
Disbursement Account, the Contingency Reserve Account, the Feedstock
Reserve Account, the TARC Feedstock Reserve Account, the Operating
Reserve Account and the Interest Accumulation Account.
"Reserve Accounts" means the Contingency Reserve Account, the
Feedstock Reserve Account, the Operating Reserve Account and the TARC
Feedstock Reserve Account.
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"TARC Accounts" means the TARC Disbursement Account, the TARC
Feedstock Reserve Account and the Interest Accumulation Account.
"TARC Feedstock Reserve Account" has the meaning given to such
term in Section 4.2(c).
Section 1.02. Section 4.1 of the TARC Disbursement Agreement.
Section 4.1(c) of the TARC Disbursement Agreement is hereby amended to read in
its entirety as follows:
(c) TEC shall maintain with the Disbursement Agent a
segregated subaccount of the TEC Disbursement Account (the "Feedstock
Reserve Account") in the name of TEC but indicating the lien of the
Trustee. Funds shall be released from the Feedstock Reserve Account
only in accordance with the provisions of Article V. Upon the
establishment of the TARC Feedstock Reserve Account, this Feedstock
Reserve Account shall be closed and any funds therein shall be
disbursed as provided in Section 5.3(b).
Section 1.03. Section 4.2 of the TARC Disbursement Agreement. Section
4.2 of the TARC Disbursement Agreement is hereby amended by adding the following
clause after clause (b):
(c) Upon the issuance by TARC of subordinated notes with
proceeds to TARC of at least $100 million, TARC shall open and
thereafter maintain with the Disbursement Agent a separate custodial
account (the "TARC Feedstock Reserve Account") under the sole dominion
and control of the Trustee, in the name of TARC but indicating the lien
of the Trustee, as assignee. Funds shall be released from the TARC
Feedstock Reserve Account only in accordance with the provisions of
Article V.
Section 1.04. Section 4.3 of the TARC Disbursement Agreement. Section
4.3 of the TARC Disbursement Agreement is hereby amended by adding the following
clause after clause (d):
(e) With respect to any deposits into the TARC Disbursement
Account on or after December 29, 1997, (i) the first $69 million shall
remain in the TARC Disbursement Account until disbursed, without
reservation of such funds to any other account and (ii) any additional
funds deposited (up to $50 million) shall be reserved to the TARC
Feedstock Reserve Account.
Section 1.05. Section 4.4 of the TARC Disbursement Agreement.
(a) Section 4.4(a) of the TARC Disbursement Agreement is
hereby amended to read in its entirety as follows:
(a) Initially, $25,500,000 of the amount deposited in
the TEC Disbursement Account shall be reserved in the
Operating Reserve Account. Upon any additional deposits to the
TEC Disbursement Account pursuant to the provisions of Section
4.3(a), the amount of such additional deposits shall be
reserved in the Contingency Reserve Account until the
aggregate amount reserved therein equals the Minimum
Contingency Reserve Amount.
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(b) Section 4.4 of the TARC Disbursement Agreement is hereby
further amended by adding the following clause after clause (b):
(c) Upon the creation of the TARC Feedstock Reserve
Account pursuant to Section 4.2(c), $10,176,272 of the amounts
then on deposit in the TEC Disbursement Account shall be
disbursed and immediately deposited into the Contingency
Reserve Account.
Section 1.06. Section 5.3 of the TARC Disbursement Agreement.
(a) Section 5.3(b) of the TARC Disbursement Agreement is
hereby amended to read in its entirety as follows:
(b) (i) Upon the creation of the TARC Feedstock
Reserve Account pursuant to Section 4.2(c) above, all funds in
the Feedstock Reserve Account, if any, shall be disbursed and
immediately deposited into the TARC Disbursement Account, and
(ii) disbursements of funds specified in a Disbursement
Certificate for the purchase of feedstock to be used in the
start up and subsequent operation of the Delayed Coking Unit
and/or Phase I ("Feedstock Disbursements") shall be made out
of the Feedstock Reserve Account or the TARC Feedstock Reserve
Account, as the case may be; provided, that the Construction
Supervisor shall have previously delivered either a Coking
Unit Completion Notice or a Phase I Completion Notice to the
Disbursement Agent.
(b) Section 5.3(c) of the TARC Disbursement Agreement is
hereby amended to read in its entirety as follows:
(c) Notwithstanding any provision hereof to the
contrary (i) on the first Business Day after the initial
deposit of funds into the TARC Disbursement Account, the
Disbursement Agent shall make a disbursement (the "Initial
Disbursement") to TARC in the amount of $32,000,000 from the
TARC Disbursement Account; provided, that the Disbursement
Agent has received a certificate of a duly authorized officer
of TARC certifying that at least $25,000,000 of the Initial
Disbursement shall be applied towards the construction of the
Project and that the remainder of the Initial Disbursement
shall be applied towards the payment of outstanding accounts
payable and (ii) on the first Business Day subsequent to a
deposit into the TARC Disbursement Account in excess of
$8,000,000 (which deposit is after December 29, 1997), the
Disbursement Agent shall make a disbursement to TARC in the
amount of $8,000,000 from the TARC Disbursement Account;
provided, that the Disbursement Agent has received a
certificate of a duly authorized officer of TARC certifying
that all of such disbursement shall be applied towards the
construction of the Project.
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(c) Section 5.3 of the TARC Disbursement Agreement is hereby
further amended by adding the following clause after clause (h):
(i) Notwithstanding any provision hereof to the
contrary, on the first Business Day after delivery of a Phase
I Completion Notice to the Disbursement Agent and TEC, the
Disbursement Agent shall liquidate all investments in the
Operating Reserve Account and release all amounts remaining on
deposit in the Operating Reserve Account to TARC in accordance
with written instructions provided by TARC.
ARTICLE II
MISCELLANEOUS
Section 2.01. Ratification and Confirmation. As amended and modified by
this First Amendment, the terms and provisions of the TARC Disbursement
Agreement are hereby ratified and confirmed and shall continue in full force and
effect.
Section 2.02. Reference to TARC Disbursement Agreement. The TARC
Disbursement Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms of the
TARC Disbursement Agreement, are hereby amended so that any reference therein to
the TARC Disbursement Agreement shall mean a reference to the TARC Disbursement
Agreement as amended hereby.
Section 2.03. Counterparts. This First Amendment may be executed in one
or more counterparts, each of which when executed shall be deemed to be an
original, but all of which when taken together shall constitute one and the same
instrument.
Section 2.04. Headings. The headings, captions and arrangements used in
this First Amendment are for convenience only and shall not affect the
interpretation of this First Amendment.
Section 2.05. Governing Law. THIS FIRST AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
Section 2.06. Certificate and Opinion as to Conditions Precedent.
Simultaneously with and as a condition to the execution of this First Amendment,
TEC is delivering to the Trustee:
(a) an Officers' Certificate in the form attached hereto as
Exhibit A; and
(b) an Opinion of Counsel covering the matters described in
Exhibit B attached hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date of first written above.
TRANSAMERICAN REFINING CORPORATION
By:
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Name:
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Title:
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TRANSAMERICAN ENERGY CORPORATION
By:
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Name:
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Title:
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FIRSTAR BANK OF MINNESOTA, N.A.,
as Disbursement Agent
By:
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Name:
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Title:
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FIRSTAR BANK OF MINNESOTA, N.A.,
as Trustee
By:
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Name:
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Title:
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XXXXX & X'XXXXX, INC.,
as Construction Supervisor
By:
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Name:
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Title:
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