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EXHIBIT 4.2
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TRANSAMERICAN ENERGY CORPORATION,
as Issuer,
and
FIRSTAR BANK OF MINNESOTA, N.A.,
as Trustee
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THIRD SUPPLEMENTAL INDENTURE
Effective as of December 15, 1998
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$475,000,000 11 1/2% Senior Secured Notes due 2002
and
$1,130,000,000 13% Senior Secured Discount Notes due 2002
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THIRD SUPPLEMENTAL INDENTURE
THIS THIRD SUPPLEMENTAL INDENTURE, effective as of December 15, 1998
(the "Supplemental Indenture"), is made and entered into by and among
TRANSAMERICAN ENERGY CORPORATION, a Delaware corporation (the "Company"), and
FIRSTAR BANK OF MINNESOTA, N.A. (the "Trustee"), under an Indenture dated as of
June 13, 1997, by and between the Company and the Trustee, as amended and
supplemented by a First Supplemental Indenture dated as of December 30, 1997 and
a Second Supplemental Indenture dated as of November 13, 1998 (as so amended,
the "Original Indenture"). All capitalized terms used in this Supplemental
Indenture that are defined in the Original Indenture, either directly or by
reference therein, have the respective meanings assigned to them therein, except
to the extent such terms are otherwise defined in this Supplemental Indenture or
the context clearly requires otherwise.
WHEREAS, Section 9.2 of the Original Indenture provides, among other
things, that, with the consent of the Holders of not less than a majority in
aggregate Value of then outstanding Notes or, with respect to certain matters,
not less than 66-2/3% in aggregate Value of the Notes at the time outstanding,
the Company, when authorized by Board Resolutions, and the Trustee (with certain
exceptions) may amend or supplement the Original Indenture or the Security
Documents or enter into an indenture supplemental thereto for the purposes of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Original Indenture or the Security Documents or of modifying
in any manner the rights of the Holders under the Original Indenture or the
Notes; and
WHEREAS, the Company has solicited consents from the Holders of the
Notes (the "Consent Solicitation") to amendments (the "Proposed Amendments") and
waivers (the "Proposed Waivers") to (i) the Original Indenture, (ii) the Loan
Agreement dated June 13, 1997, as amended, between the Company and TARC, (iii)
the Loan Agreement dated June 13, 1997, as amended, between the Company and
TransTexas and (iv) the Security and Pledge Agreement dated June 13, 1997,
between the Company and TransTexas; and
WHEREAS, the Holders of at least 66-2/3% in aggregate Value of Notes at
the time outstanding have consented to the Proposed Amendments and Proposed
Waivers pursuant to the Consent Solicitation; and
WHEREAS, the Board of Directors of the Company has adopted resolutions
authorizing and approving the Proposed Amendments and the Company and the
Trustee are executing and delivering this Supplemental Indenture in order to
provide for such amendments;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Supplemental
Indenture hereby agree as follows:
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ARTICLE I
AMENDMENTS TO ORIGINAL INDENTURE
Section 1.01. Amended Definitions. The following definitions in Section
1.1 of the Original Indenture are hereby amended as follows:
(a) The definition of "Accounts Receivable Subsidiary" is hereby
amended to read in its entirety as follows:
"Accounts Receivable Subsidiary" means a subsidiary of the
Company, TARC, TCR Holding or TransContinental designated as an
Accounts Receivable Subsidiary for the purpose of financing the
accounts receivable of TransContinental.
(b) The definition of "Affiliate" is hereby amended to read in its
entirety as follows:
"Affiliate" means, with respect to any specified Person, (i) any
other Person directly or indirectly controlling or controlled by,
or under direct or indirect common control with, such specified
Person or (ii) any officer, director or controlling shareholder of
such other Person. For purposes of this definition, the term
"control" means (a) the power to direct the management and policies
of a Person, directly or through one or more intermediaries,
whether through the ownership of voting securities, by contract, or
otherwise, or (b) without limiting the foregoing, the beneficial
ownership of 10% or more of the voting power of the voting common
equity of such Person (on a fully diluted basis) or of warrants or
other rights to acquire such equity (regardless of whether
presently exercisable). Notwithstanding the foregoing, none of the
Purchasers shall be deemed to be "Affiliates" of the Company or any
of its Subsidiaries.
(c) The definition of "Capital Improvement Program" is hereby amended
to read in its entirety as follows:
"Capital Improvement Program" means the expansion and
improvement program at TARC (or, after the Transaction Closing
Date, TransContinental) that will be executed in two phases: Phase
I and Phase II. The most significant projects include: (i)
conversion of the visbreaker unit to a delayed coking unit to
process vacuum tower bottoms into lighter petroleum products, (ii)
modernization and upgrade of a fluid catalytic cracking unit to
increase gasoline production capacity and allow the direct
processing of low cost atmospheric residual feedstocks and (iii)
upgrading and expanding hydrotreating, alkylation and sulfur
recovery units to increase sour crude processing capacity.
(d) The definition of "CATOFIN(R) Unit" is hereby amended to read in
its entirety as follows:
"CATOFIN(R) Unit" means certain real property owned by TARC
before the Transaction Closing Date as more specifically defined in
the TARC Mortgage, together with all personal property of
TransContinental now or hereinafter located on such real property
but only to the extent that such property is part of a refining
unit designed to produce propane and butane mono-olefins using the
CATOFIN(R) process.
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(e) The definition of "Consolidated Fixed Charge Coverage Ratio" is
hereby amended to read in its entirety as follows:
"Consolidated Fixed Charge Coverage Ratio" on any date (the
"Transaction Date") means, with respect to any Person, the ratio,
on a pro forma basis, of (i) (x) with respect to any Person other
than TCR Holding, the aggregate amount of Consolidated EBITDA of
such Person (attributable to continuing operations and businesses
and exclusive of the amounts attributable to operations and
businesses discontinued or disposed of, on a pro forma basis as if
such operations and businesses were discontinued or disposed of on
the first day of the Reference Period) for the Reference Period or
(y) with respect to TCR Holding, the aggregate amount of dividends
and other distributions on the Capital Stock of TransContinental
received by TCR Holding from TransContinental during the Reference
Period to (ii) the aggregate Consolidated Fixed Charges of such
Person (exclusive of amounts attributable to discontinued
operations and businesses on a pro forma basis as if such
operations and businesses were discontinued or disposed of on the
first day of the Reference Period, but only to the extent that the
obligations giving rise to such Consolidated Fixed Charges would no
longer be obligations contributing to such Person's Consolidated
Fixed Charges subsequent to the Transaction Date) during the
Reference Period; provided, that for purposes of such computation,
in calculating Consolidated EBITDA and Consolidated Fixed Charges,
(a) the transaction giving rise to the need to calculate the
Consolidated Fixed Charge Coverage Ratio shall be assumed to have
occurred on the first day of the Reference Period, (b) the
incurrence of any Debt or issuance of Disqualified Capital Stock or
the retirement of any Debt or Capital Stock during the Reference
Period or subsequent thereto and on or prior to the Transaction
Date shall be assumed to have occurred on the first day of such
Reference Period, (c) Consolidated Interest Expense attributable to
any Debt (whether existing or being incurred) bearing a floating
interest rate shall be computed as if the rate in effect on the
Transaction Date had been the applicable rate for the entire
period, unless such Person or any of its Subsidiaries is a party to
a Swap Obligation (that remains in effect for the 12-month period
after the Transaction Date) that has the effect of fixing the
interest rate on the date of computation, in which case such rate
(whether higher or lower) shall be used, and (d) Consolidated
EBITDA and Consolidated Fixed Charges of any Person shall be
calculated by giving pro forma effect to the TTXD Spin-off and each
other transaction described in the Offering Circular under the
heading "Offering Circular Summary -- The Transactions" as if such
transactions had occurred on the first day of the Reference Period,
in each case, other than the TTXD Spin-off, only if such
transaction has occurred during the Reference Period.
(f) The definitions of "Construction Supervisor" and "Debt" are hereby
amended to read in their entirety as follows:
"Construction Supervisor" means Xxxxx & X'Xxxxx, Inc., as
construction supervisor of the Capital Improvement Program or any
successor construction supervisor appointed by the Company with the
approval of TCR Holding, which approval shall not be unreasonably
withheld.
"Debt" means with respect to any person, without duplication (i)
all liabilities, contingent or otherwise, of such Person (a) for
borrowed money (whether or not the
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recourse of the lender is to the whole of the assets of such Person
or only to a portion thereof), (b) evidenced by bonds, notes,
debentures, or similar instruments or letters of credit or
representing the balance deferred and unpaid of the purchase price
of any property acquired by such Person or services received by
such Person (other than long-term services or supply contracts
which required minimum periodic payments), (c) evidenced by
bankers' acceptances or similar instruments issued or accepted by
banks or Swap Obligations, (d) for the payment of money relating to
a Capitalized Lease Obligation, (e) the Attributable Debt
associated with any Sale and Leaseback Transaction or (f) Dollar-
Denominated Production Payments that TransTexas or any of its
Subsidiaries elect to treat as Debt (excluding all other Permitted
Production Payment Obligations); (ii) reimbursement obligations of
such Person with respect to letters of credit; (iii) all
liabilities of others of the kind described in the preceding clause
(i) or (ii) that such Person has guaranteed or that is otherwise
its legal liability (to the extent of such guaranty or other legal
liability) other than for endorsements, with recourse, of
negotiable instruments in the ordinary course of business; (iv) all
obligations secured by a Lien (other than Permitted Liens, except
to the extent the obligations secured by such Permitted Liens are
otherwise included in clause (i), (ii) or (iii) of this definition
and are obligations of such Person) to which the property or assets
(including, without limitation, leasehold interests and any other
tangible or intangible property rights) of such Person are subject,
regardless of whether the obligations secured thereby shall have
been assumed by or shall otherwise be such Person's legal liability
(but, if such obligations are not assumed by such Person or are not
otherwise such Person's legal liability, the amount of such Debt
shall be deemed to be limited to the fair market value of such
property or assets determined as of the end of the preceding fiscal
quarter); and (v) any and all deferrals, renewals, extensions,
refinancings, and refundings (whether direct or indirect) of, or
amendments, modifications, or supplements to, any liability of the
kind described in any of the preceding clauses (i) through (iv)
regardless of whether between or among the same parties.
Notwithstanding anything to the contrary contained herein, for
purposes of Section 4.11, notes issued in satisfaction of the
interest obligation on up to $150 million principal amount of 15%
Senior Secured Notes due 2003 issued pursuant to the Transaction in
accordance with the terms thereof shall not constitute Debt except
for purposes of the third to last and second to last paragraphs of
Section 4.11.
(g) The definition of "Disqualified Capital Stock" is hereby amended to
read in its entirety as follows:
"Disqualified Capital Stock" means, with respect to any Person,
any Capital Stock of such Person or its Subsidiaries that, by its
terms or by the terms of any security into which it is convertible
or exchangeable, is, or upon the happening of an event or the
passage of time would be, required to be redeemed or repurchased by
such Person or its Subsidiaries, including at the option of the
holder, in whole or in part, or has, or upon the happening of an
event or passage of time would have, a redemption or similar
payment due, on or prior to June 15, 2002.
(h) The definition of "Equipment" is hereby amended to read in its
entirety as follows:
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"Equipment" means and includes, as to (i) TransTexas or any of
its Subsidiaries, all of such Person's now owned or hereafter
acquired Vehicles, drilling rigs, workover rigs, fracture
stimulation equipment, well site compressors, rolling stock and
related equipment and other assets accounted for as equipment by
such Person on its financial statements, all proceeds thereof (from
insurance or otherwise), and all documents of title, books,
records, ledger cards, files, correspondence, and computer files,
tapes, disks and related data processing software that at any time
evidence or contain information relating to the foregoing;
provided, however, that "Equipment" shall not include any assets
constituting part of a natural gas pipeline or the compression or
dehydration equipment used in the operation of any such pipeline;
provided further, however, notwithstanding the foregoing,
"Equipment" shall include (x) production related facilities, (y)
assets comprising amine plants and (z) equipment and related assets
designed to dehydrate, compress, treat, separate, stabilize, store
or otherwise process hydrocarbons, including, without limitation,
the facilities at Winnie, Texas (including the real property
associated with such facilities at Winnie, Texas) and (ii) TARC or
any of its Subsidiaries, all of such Person's now owned or
hereafter acquired Vehicles, rolling stock and related equipment
and other assets accounted for as equipment by such Person in its
financial statements, all proceeds thereof (from insurance or
otherwise), and all documents of title, books, records, ledger
cards, files, correspondence and computer files, tapes, disks and
related data processing software that at any time evidence or
contain information relating to the foregoing.
(i) The definition of "Excess Cash" is hereby amended to read in its
entirety as follows:
"Excess Cash" means the Net Cash Proceeds received by the
Company from Asset Sales by the Company and the aggregate amount of
cash and Cash Equivalents received by the Company from its
Subsidiaries, including from dividends or payments in respect of
Intercompany Loan Redemptions less the sum (without duplication) of
(a) the provision for income and other taxes of the Company or, in
the case of subclause (iii) of this clause (a), TransAmerican, (i)
for the current fiscal year, (ii) for the immediately preceding
fiscal year or (iii) relating to the sale by TransTexas of the
Capital Stock of TransTexas Transmission Corporation, (b) without
duplication, amounts received pursuant to the Services Agreement,
(c) amounts used to pay consent fees in connection with a
solicitation of waivers or amendments to the Notes, (d) dividends
received from an Accounts Receivable Subsidiary; provided, that
such funds are then contributed to TARC, TCR Holding or
TransContinental, (e) payments of interest and principal on loans
by the Company to TARC, TCR Holding, TransContinental or TransTexas
which loans are permitted by the terms of the Indenture, (f)
scheduled payments of interest and principal pursuant to the terms
of the Intercompany Loans, (g) amounts used to pay interest,
principal and premium on the Bridge Loan Notes, and (h) amounts
reserved to make interest payments on the Notes as permitted by
Section 3.1.
(j) The definition of "First Lien Debt" is hereby amended to read in
its entirety as follows:
"First Lien Debt" means any Debt or other obligation secured by
a Permitted TransTexas Lien described in clause (c), (d), (e), (f),
(i), (j),(k), (l), (o), (q), (r) to the extent that the Incurrence
of the Permitted Lien to which such clause relates is one of the
other
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clauses listed here, (s) or (t) of the definition of "Permitted
TransTexas Liens," a Permitted TARC Lien described in clause (c),
(d), (g), (h), (j), (k), (m), (o), (p), (q), (r) to the extent that
the Incurrence of the Permitted Lien to which such clause relates
is one of the other clauses listed here, (s), (t), (y) and (z) of
the definition of "Permitted TARC Liens," or a Permitted TEC Lien
described under clause (g) or (h) of Permitted TEC Liens including,
in each case, any refinancings thereof.
(k) The definition of "Gas Purchase Agreement" is hereby amended to
read in its entirety as follows:
"Gas Purchase Agreement" means the Interruptible Gas Sales Terms
and Conditions between TARC and TransTexas, as in effect on the
Issue Date and as amended from time to time, provided that any such
amendment is approved by the Board of Directors of each of the
parties thereto.
(l) The definition of "Guarantee" is hereby amended to read in its
entirety as follows:
"Guarantee" means any guarantee of the obligations of TARC or
TCR Holding under the TARC Intercompany Loan or of TransTexas under
the TransTexas Intercompany Loan by any Guarantor.
(m) The definition of "Guarantor" is hereby amended to read in its
entirety as follows:
"Guarantor" means each of TARC's, TCR Holding's or TransTexas'
Subsidiaries that becomes a guarantor of either the TARC
Intercompany Loan or the TransTexas Intercompany Loan in compliance
with the provisions of this Indenture.
(n) The definition of "Insurance Proceeds" is hereby amended to read in
its entirety as follows:
"Insurance Proceeds" means the interest in and to all proceeds
(net of costs of collection, including attorney's fees) which now
or hereafter may be paid under any insurance policies now or
hereafter obtained by or on behalf of the Company, TARC, TCR
Holding, TransTexas, or any Guarantor in connection with any assets
thereof, together with interest payable thereon and the right to
collect and receive the same, including, without limitation,
proceeds of casualty insurance, title insurance, business
interruption insurance and any other insurance now or hereafter
maintained with respect to such assets.
(o) The definition of "Intercompany Loan Redemption" is hereby amended
to read in its entirety as follows:
"Intercompany Loan Redemption" means an optional redemption by
TCR Holding or TransTexas of all or a portion of the accreted value
or principal amount, as the case may be, then outstanding under the
TARC Intercompany Loan or the TransTexas Intercompany Loan,
respectively, in cash at a redemption price equal to 100% of the
accreted value of the TARC Intercompany Loan and the principal
amount of the TransTexas Intercompany Loan in each case, plus
accrued and unpaid interest, if any, to and including the
redemption date.
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(p) The definition of "Inventory" is hereby amended to read in its
entirety as follows:
"Inventory" means and includes, (i) as to TransTexas, all of
TransTexas' now owned or hereafter acquired casing, drill pipe and
other supplies accounted for as inventory by TransTexas on its
financial statements (excluding any Hydrocarbons), all proceeds
thereof (from insurance or otherwise), and all documents of title,
books, records, ledger cards, files, correspondence, and computer
files, tapes, disks and related data processing software that at
any time evidence or contain information relating to the foregoing
and (ii) as to TARC, feedstocks, refined products, chemicals and
catalysts, other supplies and storeroom items and similar items
accounted for as inventory by TARC on its financial statements, all
proceeds thereof (from insurance or otherwise), and all documents
of title, books, records, ledger cards, files, correspondence, and
computer files, tapes, disks and related data processing software
that at any time evidence or contain information relating to the
foregoing.
(q) The definition of "Permitted Hedging Transactions" is hereby
amended to read in its entirety as follows:
"Permitted Hedging Transactions" means non-speculative
transactions in futures, forwards, swaps or option contracts
(including both physical and financial settlement transactions)
engaged in by the TARC Entities, TransContinental or the TransTexas
Entities as part of their normal business operations as a
risk-management strategy or hedge against adverse changes in the
prices of natural gas, condensate, feedstock or refined products;
provided, that such transactions do not in the case of TransTexas
or its Subsidiaries, on a monthly basis, relate to more than 90% of
the TransTexas Entities' average net hydrocarbon production per
month from the Continuing Operations for the most recent 3-month
period measured at the time of such incurrence; provided, further,
that, at the time of such transaction (i) the counter party to any
such transaction is an Eligible Institution or a Person that has an
Investment Grade Rating or has an issue of debt securities or
preferred stock outstanding with an Investment Grade Rating or (ii)
such counter party's obligation pursuant to such transaction is
unconditionally guaranteed in full by, or secured by a letter of
credit issued by, an Eligible Institution or a Person that has an
Investment Grade Rating or that has an issue of debt securities or
preferred stock outstanding with an Investment Grade Rating.
(r) The definition of "Permitted Investment" is hereby amended to read
in its entirety as follows:
"Permitted Investment" means, when used with reference to the
Company or its Subsidiaries, (i) trade credit extended to persons
in the ordinary course of business; (ii) purchases of Cash
Equivalents; (iii) Investments by TransTexas or its wholly owned
Subsidiaries in wholly owned Subsidiaries of TransTexas (other than
TTXD) that are engaged in Related TransTexas Businesses,
Investments by any of the TARC Entities or any of the TCR Holding
Entities in any of the TCR Holding Entities that are engaged, or
are formed to engage, in Related TARC Businesses or in
TransContinental, Investments by any of the TCR Holding Entities in
any of the TARC Entities that are engaged, or are formed to engage,
in Related TARC Businesses and Investments by the Company in any of
the TARC Entities or any of the TCR Holding Entities that are
engaged, or are formed to engage, in
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Related TARC Businesses; (iv) Swap Obligations; (v) the receipt
of capital stock in lieu of cash in connection with the settlement
of litigation; (vi) advances to officers and employees in
connection with the performance of their duties in the ordinary
course of business in an amount not to exceed $3,000,000 in the
aggregate outstanding at any time in the case of each of (i) the
TARC Entities and (ii) the TransTexas Entities; (vii) margin
deposits in connection with Permitted Hedging Transactions; (viii)
an Investment in one or more Unrestricted Subsidiaries of (a)
TransTexas in an aggregate amount, net of return on such
Investment, not in excess of $25,000,000 less the amount of any
Unrestricted Non-Recourse Debt outstanding of TransTexas or any of
its Subsidiaries and (b) TARC of the assets comprising the
CATOFIN(R) Unit owned by TARC as of the date hereof; (ix)
Investments and expenditures made in the ordinary course of
business by TransTexas or its Subsidiaries, and of a nature that is
or shall have become customary in, the oil and gas business as a
means of actively exploiting, exploring for, acquiring, developing,
processing, gathering, marketing or transporting oil or gas or
providing services with respect to such activities through
agreements, transactions, interests or arrangements which permit a
person to share risks or costs, comply with regulatory requirements
regarding local ownership or satisfy other objectives customarily
achieved through the conduct of the oil and gas business jointly
with third parties, including, without limitation, (a) ownership
interests in oil and gas properties or gathering systems and (b)
Investments and expenditures in the form of or pursuant to
operating agreements, processing agreements, farm-in agreements,
farm-out agreements, development agreements, area of mutual
interest agreements, unitization agreements, pooling arrangements,
joint bidding agreements, service contracts, joint venture
agreements, partnership agreements (whether general or limited),
subscription agreements, stock purchase agreements and other
similar agreements with third parties (including Unrestricted
Subsidiaries); provided, that in the case of any joint venture
primarily engaged in processing, gathering, marketing or
transporting oil or gas (i) all Debt of such joint venture (other
than a joint venture that is an Unrestricted Subsidiary) that would
not otherwise constitute Debt of one of the TransTexas Entities
shall be deemed Debt of TransTexas in proportion to its direct or
indirect ownership interest in such joint venture and (ii) such
joint venture shall be reasonably calculated to enhance the value
of the reserves of the TransTexas Entities or marketability of
production from such reserves; (x) a guaranty by any Subsidiary of
the Company permitted under Section 4.11; (xi) deposits permitted
by the definition of Permitted Liens or any extension, renewal, or
replacement of any of them, (xii) the TTXD Equity Investment (in
addition to any contribution by TransTexas pursuant to clause
(xiii) below), (xiii) capital contributions by TransTexas to TTXD
or to a joint venture, a partnership, a limited liability company
or a similar entity of TransTexas' drilling and energy services
business and pipeline services business and related assets, (xiv)
any acquisition by TARC of tank storage facilities (or the company
that owns such facilities) in the vicinity of the TARC refinery,
(xv) guarantees by TransTexas of Debt of TTXD to the extent that
such Debt relates to assets contributed to TTXD pursuant to clause
(xiii) hereof, (xvi) Investments in Accounts Receivables Subsidiary
Notes by the Company, any of the TARC Entities or any of the TCR
Holding Entities in amounts not to exceed the greater of
$20,000,000 or 20% of the TransContinental Borrowing Base at any
one time, (xvii) loans from the Company to its Subsidiaries or
TransContinental (other than the TTXD Entities prior to the TTXD
Spin-off) with (i) the excess of the Excess Cash Offer Amount
(after reserving the full Interest Reserve Amount) over the Excess
Cash Acceptance Amount, provided, that such loans are on terms no
less favorable to the Company than were
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disclosed to the Holders of the Notes in the Excess Cash Offer
or (ii) the excess of the Additional Interest Excess Cash Offer
Amount over the Additional Interest Excess Cash Acceptance Amount,
provided, that such loans are on terms no less favorable to the
Company than were disclosed to the Holders of the Notes in the
Additional Interest Excess Cash Offer, (xviii) an Investment in
Capital Stock resulting from an Asset Sale pursuant to clause
(xiii) of Section 4.14(b), (xix) Investments by the Company in an
Accounts Receivable Subsidiary, or by the Company or TARC in a
reincorporation subsidiary in each case in connection with the
initial capitalization thereof and not to exceed $1,000, (xx)
Investments by the Company, TARC, TCR Holding or a wholly owned
Subsidiary of any of them solely for the purpose of facilitating a
repurchase of the TARC Warrants, (xxi) other Investments not in
excess of $5,000,000 at any time outstanding, (xxii) loans made (X)
to officers, directors and employees of the Company or any of its
Subsidiaries approved by the applicable Board of Directors (or by
an authorized officer), the proceeds of which are used solely to
purchase stock or to exercise stock options received pursuant to an
employee stock option plan or other incentive plan, in a principal
amount not to exceed the purchase price of such stock or the
exercise price of such stock options, as applicable and (Y) to
refinance loans, together with accrued interest thereon, made
pursuant to this clause, in each case not in excess of $3,000,000
in the aggregate outstanding at any one time, (xxiii) Investments
by the Company in its Subsidiaries in an aggregate amount not to
exceed the proceeds of Subordinated Debt permitted to be incurred
pursuant to clause (5)(d) of Section 4.11, (xxiv) Investments by
the Company in TARC, TCR Holding or TransContinental in an amount
not to exceed the amounts received by the Company from an Accounts
Receivable Subsidiary, (xxv) a capital contribution by TTXD of any
or all of its assets to a joint venture, a partnership, a limited
liability company or a similar entity, (xxvi) a capital
contribution by the Company to TARC in an amount not to exceed
$226,000,000 (inclusive of any equity contribution made as
described in the Offering Circular under the heading "The
Transactions -- TARC Equity Contribution"), (xxvii) any deposit or
escrow of funds in connection with adjustments to the Lobo Sale
purchase price, (xxviii) loans made by the Company to TransTexas,
TARC, TCR Holding or TransContinental which in the aggregate do not
exceed $50,000,000 principal amount outstanding at any one time,
(xxix) loans from the Company to TARC of an amount equal to the
proceeds received by it from the issuance of the Bridge Loan Notes,
(xxx) the purchase or other acquisition by TARC or TCR Holding or
its Subsidiaries of Notes or (xxxi) the purchase or other
acquisition by TransTexas of Notes to the extent, but only to the
extent, that TransTexas has received such Notes, or an amount equal
to its cost of acquiring such Notes, as a capital contribution from
Persons other than the Company or its Subsidiaries.
(s) The definition of "Permitted Production Payment Obligations" is
hereby amended to read in its entirety as follows:
"Permitted Production Payment Obligations" means Volumetric
Production Payments and Dollar-Denominated Production Payments each
as permitted to be made hereunder, and similar burdens on the
property of TransTexas or any Subsidiary of TransTexas to the
extent such burdens are limited in recourse to (x) the properties
subject to such interests or agreements (including, without
limitation, TransTexas' contract rights in related Permitted
Hedging Transactions), (y) the Hydrocarbons produced from such
properties, and (z) the proceeds of such Hydrocarbons.
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(t) The definition of "Permitted TARC Liens" is hereby amended to read
in its entirety as follows:
"Permitted TARC Liens" means (a) Liens imposed by governmental
authorities for taxes, assessments, or other charges not yet due or
which are being contested in good faith and by appropriate
proceedings, if adequate reserves with respect thereto are
maintained on the books of any of the TARC Entities in accordance
with GAAP; (b) statutory Liens of landlords, carriers,
warehousemen, mechanics, materialmen, repairmen, mineral interest
owners, or other like Liens arising by operation of law in the
ordinary course of business provided that (i) the underlying
obligations are not overdue for a period of more than 60 days, or
(ii) such Liens are being contested in good faith and by
appropriate proceedings and adequate reserves with respect thereto
are maintained on the books of any of the TARC Entities in
accordance with GAAP; (c) deposits of cash or Cash Equivalents to
secure (i) the performance of bids, trade contracts (other than
borrowed money), leases, statutory obligations, surety bonds,
performance bonds, and other obligations of a like nature incurred
in the ordinary course of business (or to secure reimbursement
obligations or letters of credit issued to secure such performance
or other obligations) in an aggregate amount outstanding at any one
time not in excess of $5,000,000 or (ii) appeal or supersedeas
bonds (or to secure reimbursement obligations or letters of credit
in support of such bonds); (d) easements, servitudes,
rights-of-way, zoning, similar restrictions and other similar
encumbrances or title defects incurred in the ordinary course of
business which, in the aggregate, are not material in amount and
which do not, in any case, materially detract from the value of the
property subject thereto (as such property is used by any of the
TARC Entities) or materially interfere with the ordinary conduct of
the business of any of the TARC Entities including, without
limitation, any easement or servitude granted in connection with
the Port Commission Bond Financing; (e) Liens arising by operation
of law in connection with judgments, only to the extent, for an
amount and for a period not resulting in an Event of Default with
respect thereto; (f) Liens securing Debt or other obligations not
in excess of $3,000,000; (g) pledges or deposits made in the
ordinary course of business in connection with worker's
compensation, unemployment insurance, other types of social
security legislation, property insurance and liability insurance;
(h) Liens on Equipment, Receivables and Inventory; (i) Liens on the
assets of any entity existing at the time such assets are acquired
by any of the TARC Entities, whether by merger, consolidation,
purchase of assets or otherwise so long as such Liens (i) are not
created, incurred or assumed in contemplation of such assets being
acquired by any of the TARC Entities and (ii) do not extend to any
other assets of any of the TARC Entities; (j) Liens (including
extensions and renewals thereof) on real or personal property,
acquired after the Issue Date ("New TARC Property"); provided,
however, that (i) such Lien is created solely for the purpose of
securing Debt Incurred to finance the cost (including the cost of
improvement or construction) of the item of New TARC Property
subject thereto and such Lien is created at the time of or within
six months after the later of the acquisition, the completion of
construction, or the commencement of full operation of such New
TARC Property, (ii) the principal amount of the Debt secured by
such Lien does not exceed 100% of such cost plus reasonable
financing fees and other associated reasonable out-of-pocket
expenses (iii) any such Lien shall not extend to or cover any
property or assets other than such item of New TARC Property and
any improvements on such New TARC Property and
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(iv) such Lien does not extend to assets or property which are
part of the fixed refinery assets which are part of the Capital
Improvement Program; (k) leases or subleases granted to others that
do not materially interfere with the ordinary course of business of
any of the TARC Entities, taken as a whole; (l) Liens on the assets
of one of the TARC Entities in favor of another TARC Entity; (m)
Liens securing reimbursement obligations with respect to letters of
credit that encumber documents relating to such letters of credit
and the products and proceeds thereof; provided, that, such
reimbursement obligations are not matured for a period of over 60
days; (n) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in
connection with the importation of goods; (o) Liens encumbering
customary initial deposits and margin deposits securing Swap
Obligations or Permitted Hedging Transactions and Liens encumbering
contract rights under Permitted Hedging Transactions; (p) Liens on
cash deposits to secure reimbursement obligations with respect to
letters of credit after the Delayed Coking Unit is completed; (q)
Liens that secure Unrestricted Non-Recourse Debt; provided,
however, that at the time of incurrence the aggregate fair market
value of the assets securing such Lien (exclusive of the stock of
the applicable Unrestricted Subsidiary) shall not exceed the amount
of allowed Unrestricted Non-Recourse Debt of TARC, or TCR Holding;
(r) Liens on the proceeds of any property subject to a Permitted
TARC Lien or on deposit accounts containing any such proceeds; (s)
Liens on the proceeds of any property that is not Collateral, on
the proceeds of any Debt Incurred in accordance with the provisions
hereof, or on deposit accounts containing any such proceeds; (t)
Liens imposed on the Port Facility Assets; (u) any extension,
renewal or replacement of the Liens created pursuant to any of
clauses (a) through (g), (i) through (t), (u) or (w) provided that
such Liens would have otherwise been permitted under such clauses,
and provided further that the Liens permitted by this clause (u) do
not secure any additional Debt or encumber any additional property;
(v) Liens of the trustee under indenture and related collateral
documents governing the terms of the Senior TARC Mortgage Notes and
the Senior TARC Discount Notes; (w) Liens in favor of the Company
or its assignee under the Security Documents; (y) Liens on tank
storage facilities in the vicinity of the TARC refinery acquired
after the date hereof;(z) Liens on any property of TARC and any
agreement to grant such Liens; provided that such Liens may not be
granted, and any agreement to grant such Liens shall not obligate
TARC to grant such Liens, until the TARC Intercompany Loan has been
paid in full and has not been refinanced, refunded or replaced with
the proceeds of other Debt ("Other Debt"), which Other Debt has a
lower cost of capital to TARC than the TARC Intercompany Loan and
the principal amount of such Other Debt (or, if such Other Debt is
issued with original issued discount, the original issue price of
such Other Debt) is equal to or less than the original price of,
plus amortization of the original issue discount on, the TARC
Intercompany Loan at the time of the Incurrence of such Other Debt;
(aa) Liens securing the TARC Intercompany Bridge Loan; (bb) Liens
on any property owned by TransContinental; and (cc) a Lien in favor
of the Purchasers and others securing Debt of TARC or TCR Holding
in an aggregate principal amount not in excess of $150,000,000.
(u) The definition of "Permitted TransTexas Liens" is hereby amended to
read in its entirety as follows:
"Permitted TransTexas Liens" means (a) Liens imposed by
governmental authorities for taxes, assessments, or other charges
not yet due or which are being contested in good
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faith and by appropriate proceedings, if adequate reserves with
respect thereto are maintained on the books of any of the
TransTexas Entities in accordance with GAAP; (b) statutory Liens of
landlords, carriers, warehousemen, mechanics, materialmen,
repairmen, mineral interest owners, or other like Liens arising by
operation of law in the ordinary course of business, provided that
(i) the underlying obligations are not overdue for a period of more
than 60 days, or (ii) such Liens are being contested in good faith
and by appropriate proceedings and adequate reserves with respect
thereto are maintained on the books of any of the TransTexas
Entities in accordance with GAAP; (c) (i) pledges of assets or
deposits of cash or Cash Equivalents to secure the performance of
bids, trade contracts (other than borrowed money), leases,
statutory obligations, surety bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business (or to secure reimbursement obligations or letters of
credit in support of such bonds) in an aggregate amount not in
excess of 5% of the SEC PV10 indicated on TransTexas' most recent
Reserve Report at the time such pledges or deposits are made or
(ii) pledges of assets, the fair market value of which is not in
excess of $40,000,000 in the aggregate pledged at any one time, or
deposits of cash or Cash Equivalents, in each case, to secure
appeal or supersedeas bonds (or to secure reimbursement obligations
or letters of credit in support of such bonds); (d) Liens
encumbering customary initial deposits and margin deposits securing
Swap Obligations or Permitted Hedging Transactions and Liens
encumbering contract rights under Permitted Hedging Transactions;
(e) pledges of assets including, without limitation, the mortgage
of a production payment by a Hedging Subsidiary, to secure margin
obligations, settlement obligations, reimbursement obligations or
letters of credit in connection with Permitted Hedging
Transactions; provided that, at the time such pledge is made (or,
if such pledge secures future Permitted Hedging Transactions, at
the time any such Permitted Hedging Transaction is entered into),
the maximum aggregate exposure under such Permitted Hedging
Transactions does not exceed the greater of (i) $25,000,000 or (ii)
10% of the SEC PV10 indicated on TransTexas' then most recent
Reserve Report; (f) easements, rights-of-way, zoning, similar
restrictions and other similar encumbrances or title defects
incurred in the ordinary course of business which, in the
aggregate, are not material in amount, and which do not in any case
materially detract from the value of the property subject thereto
(as such property is used by any of the TransTexas Entities) or
materially interfere with the ordinary conduct of the business of
any of the TransTexas Entities; (g) Liens arising by operation of
law in connection with judgments, only to the extent, for an amount
and for a period not resulting in an Event of Default with respect
thereto; (h) Liens securing Debt or other obligations not in excess
of $3,000,000 in the aggregate outstanding at any one time and
Liens existing on the date of this Indenture; (i) pledges or
deposits made in the ordinary course of business in connection with
worker's compensation, unemployment insurance, and other types of
social security legislation, property insurance and liability
insurance; (j) Liens granted on Equipment, Inventory or
Receivables; (k) Liens granted in connection with the Presale of
Gas, provided that all of the proceeds from such Presale of Gas
shall be applied to an Intercompany Loan Redemption; (l) Liens
created on acreage drilled or to be drilled pursuant to Drilling
Programs, on Hydrocarbons produced therefrom and on the proceeds of
such Hydrocarbons to secure TransTexas' obligations thereunder,
provided that (i) the number of xxxxx included in such program
commenced in any fiscal year does not exceed 30 per fiscal year
(plus the number of xxxxx included in programs commenced in prior
years but not yet completed), (ii) such obligations are limited to
a percentage of production from such
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xxxxx, (iii) such Liens survive only until the Person to whom such
Lien was granted has received production with a value equal to the
reimbursable costs, expenses and fees related to property and
services provided or paid for by such Person plus an agreed-upon
interest component, and (iv) such Liens secure obligations that are
nonrecourse to each of the Company or its Subsidiaries; (m) Liens
on the assets of any entity existing at the time such assets are
acquired by any of the TransTexas Entities, whether by merger,
consolidation, purchase of assets or otherwise so long as such
Liens (i) are not created, incurred or assumed in contemplation of
such assets being acquired by any of the TransTexas Entities and
(ii) do not extend to any other assets of any of the Company or its
Subsidiaries; (n) any extension, renewal, or replacement of Liens
created pursuant to any of clauses (a) through (g), (i), (k)
through (m) or (q) through (t) of this definition, provided that
such Liens would have otherwise been permitted under such clauses,
and further provided that the Liens permitted by this clause (n) do
not secure any additional Debt or encumber any additional property;
(o) Liens securing (i) Royalty Payment Obligations and (ii)
Permitted Production Payment Obligations; (p) Liens on the assets
of any of the TransTexas Entities in favor of another TransTexas
Entity; (q) Liens that secure Unrestricted Non-Recourse Debt;
provided however, that at the time of incurrence the aggregate fair
market value of the assets securing such Lien (exclusive of the
stock of the applicable Unrestricted Subsidiary) shall not exceed
the amount of allowed Unrestricted Non-Recourse Debt of TransTexas;
(r) Liens on the proceeds of any property subject to a Permitted
TransTexas Lien or on deposit accounts containing any such
proceeds; (s) Liens on the proceeds of any property that is not
Collateral; (t) Liens (including extensions and renewals thereof)
on real or personal property, acquired after the Issue Date ("New
TransTexas Property"); provided, however, that (i) such Lien is
created solely for the purpose of securing Debt Incurred to finance
the cost (including the cost of improvements or construction) of
New TransTexas Property subject thereto and such Lien is created at
the time of or within six months after the later of the
acquisition, the completion of construction, or the commencement of
full operation of such New TransTexas Property, (ii) the principal
amount of the Debt secured by such Lien does not exceed 100% of
such cost including costs and fees related to the financing
thereof, (iii) any such Lien shall not extend to or cover any
property or assets other than such item of New TransTexas property
and any improvements on such New TransTexas Property; (u) Liens of
the trustee under the Indenture and related collateral documents
governing the terms of the TransTexas Senior Notes and (v) Liens in
favor of the Company or its assignee under the Security Documents.
(v) The definition of "Phase I Completion Date" is hereby amended to
read in its entirety as follows:
"Phase I Completion Date" means the date on which the
Construction Supervisor issues a written notice (the "Phase I
Completion Notice") to the Company certifying that the Phase I
Performance Test has been completed.
(w) A definition of "Phase I Performance Test" is hereby added to the
Original Indenture to read in its entirety as follows:
"Phase I Performance Test" means for a period of at least 72
uninterrupted hours, TransContinental's refinery has sustained (i)
an average feedstock throughput level of at
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least 150,000 barrels per day and (ii) no net production of vacuum
tower bottoms when using as input a combined feedstock slate with
an average API Gravity of 22 degrees or less.
(x) The definition of "Phase II Completion Date" is hereby amended to
read in its entirety as follows:
"Phase II Completion Date" means the date on which the
Construction Supervisor issues a written notice (the "Phase II
Completion Notice") to the Company certifying that for a period of
at least 72 uninterrupted hours, TransContinental's refinery has
sustained (i) an average feedstock throughput level of at least
180,000 barrels per day and (ii) average production yields
(measured as the liquid volume percent of feedstock throughput) of
refined products with a specific gravity of gasoline or lighter of
at least 40% and of middle distillates or lighter of at least 60%,
when using a combined Crude Unit feedstock slate with an average
API Gravity of 22 degrees or less.
(y) The definition of "Plans" is hereby amended to read in its entirety
as follows:
"Plans" means (a) the plans and specifications prepared by or on
behalf of TARC (or, after the Transaction Closing Date,
TransContinental), which describe and show the proposed expansion
and modification of TARC's (or, after the Transaction Closing Date,
TransContinental's) refinery, as amended from time to time with the
consent of the Construction Supervisor and (b) a budget prepared by
or on behalf of TARC (or, after the Transaction Closing Date,
TransContinental), as amended from time to time with the consent of
the Construction Supervisor.
(z) The definition of "Port Commission Bond Financing" is hereby
amended to read in its entirety as follows:
"Port Commission Bond Financing" means a financing transaction
involving the transfer (including, without limitation, transfer by
sale, lease, lien or mortgage) of TransContinental's interest in
all or some of the following assets (together with the granting, at
TransContinental's discretion, of any easements or servitudes
reasonably necessary to the ownership or operation of such assets
by the transferee) which are under construction in or near
TransContinental's refinery: (i) the Prospect Road tank farm and
other tanks; (ii) certain dock improvements; (iii) the dock vapor
recovery system; (iv) the coke handling system; (v) the refinery
waste water treatment facility and (vi) tankage for liquefied
petroleum gas (the "Port Facility Assets").
(aa) A definition of "Purchasers" is hereby added to the Original
Indenture to read in its entirety as follows:
"Purchasers" means the initial purchasers from TARC pursuant to
the Transaction of voting stock of TCR Holding and their
transferees and Affiliates (in each case other than the Company and
its Subsidiaries).
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(bb) A definition of "Refinery Assets" is hereby added to the Original
Indenture to read in its entirety as follows:
"Refinery Assets" means substantially all of the assets of TARC
immediately prior to the Transaction Closing Date.
(cc) The definition of "Related Person" is hereby amended to read in its
entirety as follows:
"Related Person" means (i) any Person (other than a Purchaser or
TransContinental and any of its Subsidiaries) directly or
indirectly controlling or controlled by or under direct or indirect
common control with the Company or any Subsidiary of the Company or
any officer, director, or employee of the Company or any Subsidiary
of the Company or of such Person, (ii) the spouse, any immediate
family member, or any other relative who has the same principal
residence of any Person described in clause (i) above, and any
Person, directly or indirectly, controlling or controlled by or
under direct or indirect common control with, such spouse, family
member, or other relative, and (iii) any trust in which any Person
described in clause (i) or (ii), above, is a fiduciary or has a
beneficial interest. For purposes of this definition the term
"control" means (a) the power to direct the management and policies
of a Person, directly or through one or more intermediaries,
whether through the ownership of voting securities, by contract, or
otherwise, or (b) the beneficial ownership of 10% or more of the
voting common equity of such Person (on a fully diluted basis) or
of warrants or other rights to acquire such equity (whether or not
presently exercisable).
(dd) The definition of "Related TransTexas Business" is hereby amended
to read in its entirety as follows:
"Related TransTexas Business" means (i) the exploration for,
acquisition of, development of, production, transportation,
gathering, and processing (in connection with natural gas and
natural gas liquids only) of, crude oil, natural gas, condensate,
and natural gas liquids; provided that the Related TransTexas
Business shall not include any refining or distilling of
Hydrocarbons other than processing and fractionating natural gas
and natural gas liquids, (ii) the drilling and energy services
business and pipeline services business, (iii) owning and operating
a Hedging Subsidiary or (iv) owning and operating facilities in or
near Winnie, Texas, designed for separation, dehydration,
treatment, stabilization, processing and storage of hydrocarbons
and related operations.
(ee) The definition of "Restricted Payment" is hereby amended to read in
its entirety as follows:
"Restricted Payment" means, with respect to any Person, (i) any
Restricted Investment, (ii) any dividend or other distribution on
shares of Capital Stock of such Person or any Subsidiary of such
Person, (iii) any payment on account of the purchase, redemption,
or other acquisition or retirement for value of any shares of
Capital Stock of such Person, and (iv) any defeasance, redemption,
repurchase, or other acquisition or retirement for value, or any
payment in respect of any amendment in anticipation of or in
connection with any such retirement, acquisition, or defeasance, in
whole or in part, of any Subordinated Debt, directly or indirectly,
of such Person or a Subsidiary of such Person prior to the
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scheduled maturity or prior to any scheduled repayment of
principal in respect of such Subordinated Debt; provided, however,
that the term "Restricted Payment" does not include (i) any
dividend, distribution, or other payment on shares of Capital Stock
of an issuer solely in shares of Qualified Capital Stock of such
issuer that is at least as junior in ranking as the Capital Stock
on which such dividend, distribution, or other payment is to be
made, (ii) any dividend, distribution, or other payment to the
Company from any of its Subsidiaries, (iii) any defeasance,
redemption, repurchase, or other acquisition or retirement for
value, in whole or in part, of any Subordinated Debt of such Person
payable solely in shares of Qualified Capital Stock of such Person,
(iv) any payments or distributions made pursuant to and in
accordance with the Transfer Agreement, the TransTexas Drilling
Agreement, the Services Agreement, the Office Leases or the Tax
Allocation Agreement, (v) any dividend, distribution or other
payment to TARC by TCR Holding or by any of TARC's Subsidiaries, to
TCR Holding by any of TCR Holding's Subsidiaries or to TransTexas
by any of its Subsidiaries, (vi) any Intercompany Loan Redemptions,
(vii) any redemption, repurchase or other retirement for value of
the TARC Warrants by the Company, TARC or TCR Holding, including
any premium paid thereon, (viii) any redemption, repurchase or
other retirement for value of the TEC Preferred Stock by the
Company, including any premium paid thereon, (ix) any redemption,
defeasance, repurchase or other retirement for value of the Senior
TARC Mortgage Notes by TARC, including any premium paid thereon,
(x) any redemption, defeasance, repurchase or other retirement for
value of the Senior TARC Discount Notes by TARC, including any
premium paid thereon, (xi) any redemption, defeasance, repurchase
or other retirement for value of the Senior TransTexas Notes by
TransTexas, including any premium paid thereon, (xii) an Investment
by TransTexas in, or distribution by TransTexas on, its Capital
Stock pursuant to share repurchases or dividends on its Capital
Stock in each case as described in the Offering Circular under the
caption "Transactions" in an aggregate amount not to exceed
$400,000,000, (xiii) the redemption, purchase, retirement or other
acquisition of any Debt, including any premium paid thereon, with
the proceeds of any refinancing Debt permitted to be incurred
pursuant to clause (1)(g), (2)(u), (2)(w), (3)(j), 4(j), (4)(w),
(4)(z) or 5(e) of Section 4.11, (xiv) the distribution by
TransTexas of shares of capital stock of TTXD in connection with
the TTXD Spin-off, (xv) after the repayment of the TARC
Intercompany Loan or the TransTexas Intercompany Loan, dividends or
other distributions on shares of common stock of TARC or
TransTexas, respectively, provided that each such dividend or
distribution is paid to all holders of common stock of such entity
on a pro rata basis, (xvi) the purchase by TARC, TCR Holding or
TransTexas of shares of Capital Stock of TARC, TCR Holding,
TransContinental, TransTexas or TTXD in connection with each of
their employee benefit plans, including without limitation any
employee stock ownership plans or any employee stock option plans,
in an aggregate amount, with respect to the issuer, not to exceed
7% of the aggregate number of shares of voting stock held by
non-affiliates of the issuer measured from the date of the first
such purchase, (xvii) dividends or other payments not to exceed
$23,000,000 in the aggregate from the Company to TransAmerican,
(xviii) any repayment or retirement for value by TARC, TCR Holding
or TransTexas of any loan from the Company incurred pursuant to
clause (1)(q), (1)(r), (2)(o), (2)(p), (3)(u), (3)(v), (4)(s), or
(4)(t) of Section 4.11, (xix) any purchase of Capital Stock of TCR
Holding by the Company or TARC, (xx) any purchase of Capital Stock
of TransContinental by TCR Holding, (xxi) repayments by TCR Holding
of its promissory note in the initial aggregate principal amount of
$200,000,000 to TARC as part of a contemporaneous exchange of
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subordinated notes of TCR Holding, (xxii) after the repayment of
the TransTexas Intercompany Loan, repayments or repurchases by
TransTexas of its Senior Subordinated Notes due 2003, and (xxiii)
any distribution, dividend or payment on shares of Capital Stock of
TCR Holding (x) the proceeds of which are used to purchase Notes or
(y) that are exchanged for Notes and (xxiv) the redemption by TCR
Holding of equity securities pursuant to the TCR Holding
Participating Preferred Stock Redemption..
(ff) The definition of "Services Agreement" is hereby amended to read in
its entirety as follows:
"Services Agreement" means the Services Agreement among TNGC
Holdings and its Subsidiaries, as in effect on the Issue Date and
as amended from time to time, provided that any such amendment is
approved by the Board of Directors of each of the parties thereto
that will be bound by such amendment.
(gg) The definition of "Subordinated Debt" is hereby amended to read in
its entirety as follows:
"Subordinated Debt" means Debt of TARC, TCR Holding,
TransContinental or TransTexas that (i) requires no payment of
principal prior to or on the date on which all principal of and
interest on the respective Intercompany Loans is paid in full and
(ii) is subordinate and junior in right of payment to the
respective Intercompany Loans in the event of a liquidation.
(hh) The definition of "Subsidiary" is hereby amended to read in its
entirety as follows:
"Subsidiary" with respect to any Person, means (i) a corporation
with respect to which such Person or its Subsidiaries owns,
directly or indirectly, at least fifty percent of such
corporation's Capital Stock with voting power, under ordinary
circumstances, to elect directors, or (ii) a partnership in which
such Person or a subsidiary of such Person is, at the time, a
general partner of such partnership and has more than 50% of the
total voting power of partnership interests entitled (without
regard to the occurrence of any contingency) to vote in the
election of managers thereof, or (iii) any other Person (other than
a corporation or a partnership) in which such Person, one or more
Subsidiaries of such Person, or such Person and one or more
Subsidiaries of such Person, directly or indirectly, at the date of
determination thereof has (x) at least a fifty percent ownership
interest or (y) the power to elect or direct the election of the
directors or other governing body of such other Person; provided,
however, that "Subsidiary" shall not include (i) for the purposes
of Section 4.16, a joint venture an investment in which would
constitute a Permitted Investment under clause (ix) of the
definition thereof, (ii) any Unrestricted Subsidiary of such
Person, except for purposes of Section 4.10 or (iii) an Accounts
Receivable Subsidiary; provided, further, however, that, TCR
Holding and its subsidiaries other than TransContinental shall be
"Subsidiaries" of TARC and the Company (except for purposes of the
Security Documents and Section 4.16) until, but only until, payment
in full of the TARC Intercompany Loan, and TransContinental shall
not be a "Subsidiary" of any Person.
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(ii) The definition of "TARC Collateral" is hereby amended to read in
its entirety as follows:
"TARC Collateral" means (x) the assets of TARC and TCR Holding
which are mortgaged or pledged to the Company as security for the
TARC Intercompany Loan in accordance with the TARC Security
Documents and (y) to the extent required hereby, the Guarantees by
the Subsidiaries of TARC of the TARC Intercompany Loan.
(jj) A definition of "TARC Intercompany Loan Amendment" is hereby added
to the Original Indenture to read in its entirety as follows:
"TARC Intercompany Loan Amendment" means the second amendment to
the TARC Intercompany Loan upon substantially the terms described
in the form attached hereto as Exhibit C.
(kk) A definition of "TransContinental" is hereby added to the Original
Indenture to read in its entirety as follows:
"TransContinental" means TransContinental Refining Corporation,
a Delaware corporation, to which the Refinery Assets will be
transferred by TCR Holding pursuant to the Transaction and, for
purposes of Section 4.11 hereof, its Subsidiaries.
(ll) The definition of "TARC Borrowing Base" is hereby amended to read
in its entirety as follows:
"TransContinental Borrowing Base" means, as of any date, an
amount equal to the sum of (a) 90% of the book value of all
accounts receivable owned by TransContinental and its Subsidiaries
(excluding any accounts receivable that are more than 90 days past
due, less (without duplication) the allowance for doubtful accounts
attributable to such current accounts receivable) calculated on a
consolidated basis and in accordance with GAAP and (b) 85% of the
current market value of all inventory owned by TransContinental and
its Subsidiaries as of such date. To the extent that information is
not available as to the amount of accounts receivable as of a
specific date, TransContinental may utilize, to the extent
reasonable, the most recent available information for purposes of
calculating the TransContinental Borrowing Base.
(mm) The definition of "TARC Security Documents" is hereby amended to
read in its entirety as follows:
"TARC Security Documents" means the TARC Intercompany Loan, the
TCR Holding Pledge Agreement, the Disbursement Agreement,
registration rights agreements relating to the shares of TARC and
TransContinental common stock pledged to the Indenture Trustee and
each other agreement relating to the pledge of assets to secure the
TARC Intercompany Loan and any guarantee of the obligations of TCR
Holding under the TARC Intercompany Loan by any Guarantor that may
be entered into after the date of the TARC Intercompany Loan,
pursuant to the terms of the TARC Intercompany Loan, in each case
as amended from time to time.
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(nn) A definition of "TARC Subordinated Notes" is hereby added to the
Original Indenture to read in its entirety as follows:
"TARC Subordinated Notes" means the 16% Series A and Series C
Senior Subordinated Notes due 2003 issued by TARC.
(oo) A definition of "TCR Holding" is hereby added to the Original
Indenture to read in its entirety as follows:
"TCR Holding" means TCR Holding Corporation, a Delaware
corporation, to which the Refinery Assets will be transferred by
TARC pursuant to the Transaction.
(pp) A definition of "TCR Holding Entities" is hereby added to the
Original Indenture to read in its entirety as follows:
"TCR Holding Entities" means TCR Holding and each of its
Subsidiaries.
(qq) A definition of "TCR Holding Participating Preferred Stock
Redemption" is hereby added to the Original Indenture to read in its entirety as
follows:
"TCR Holding Participating Preferred Stock Redemption" means the
redemption by TCR Holding of its Participating Preferred Stock
issued pursuant to the Transaction in exchange for (i) debt
securities of TCR Holding with an aggregate principal amount equal
to the liquidation preference of such Participating Preferred
Stock, with a maturity date of June 1, 2002 and bearing interest at
a rate sufficient to pay interest on the TARC Intercompany Loan and
the TARC Subordinated Notes and (ii) common stock of TCR Holding
equal to 30.6% of the equity interest in TCR Holding and 41% of the
voting power of TCR Holding's capital stock.
(rr) A definition of "TCR Holding Pledge Agreement" is hereby added to
the Original Indenture to read in its entirety as follows:
"TCR Holding Pledge Agreement" means the Pledge Agreement
between TCR Holding and the Company pursuant to which TCR Holding
pledges all of the common stock of TransContinental owned by TCR
Holding upon consummation of the Transaction to the Company as
security for the TARC Working Capital Loan.
(ss) The definition of "TARC Warrants" is hereby amended to read in its
entirety as follows:
"TARC Warrants" means the common stock purchase warrants of TARC
issued on February 23, 1995, December 30, 1997 and March 16, 1998
and all other common stock purchase warrants of TARC outstanding on
the Transaction Closing Date.
(tt) A definition of "TARC Working Capital Loan" is hereby added to the
Original Indenture to read in its entirety as follows:
"TARC Working Capital Loan" means a loan by the Company to TARC
of up to $50 million.
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(uu) The definition of "Tax Allocation Agreement" is hereby amended to
read in its entirety as follows:
"Tax Allocation Agreement" means the Tax Allocation Agreement,
dated as of August 24, 1993, among TNGC Holdings Corporation, the
Company and certain Subsidiaries, as in effect on the Issue Date
and as amended from time to time, provided that any such amendment
is approved by the Board of Directors of each of the parties
thereto that will be bound by such amendment.
(vv) A definition of "Transaction" is hereby added to the Original
Indenture to read in its entirety as follows:
"Transaction" means a series of related transactions (as more
fully described in the Company's Consent Solicitation Statement
dated September 30, 1998, as amended, pursuant to which consents
were solicited from the Holders to amendments to the Indenture to
facilitate the Transaction, which description is incorporated
herein by reference) pursuant to which, among other things, (i) the
Lien on the TARC Collateral is released, (ii) TARC transfers to TCR
Holding the Refinery Assets in exchange for (x) all of the capital
stock of TCR Holding and (y) the assumption by TCR Holding of
certain debt and other obligations of TARC, (iii) TCR Holding
transfers to TransContinental the Refinery Assets in exchange for
all of the common stock of TransContinental and TransContinental
assumes the debt and other obligations of TARC assumed by TCR
Holding other than the TARC Working Capital Loan and (iv) certain
Purchasers purchase (x) debt securities issued by TARC, (y) equity
securities issued by TransContinental and (z) TCR Holding capital
stock from TARC for aggregate gross proceeds of approximately $151
million.
(ww) A definition of "Transaction Closing Date" is hereby added to the
Original Indenture to read in its entirety as follows:
"Transaction Closing Date" means the date the Refinery Assets
are transferred by TARC to TCR Holding and by TCR Holding to
TransContinental pursuant to the Transaction.
(xx) A definition of "TransTexas Intercompany Loan Amendment" is hereby
added to the Original Indenture to read in its entirety as follows:
"TransTexas Intercompany Loan Amendment" means the second
amendment to the TransTexas Intercompany Loan upon substantially
the terms described in the form attached hereto as Exhibit D.
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(yy) A definition of "TransTexas Security Agreement Amendment" is
hereby added to the Original Indenture to read in its entirety as follows:
"TransTexas Security Agreement Amendment" means the first
amendment to the TransTexas Security Agreement upon substantially
the terms described in the form attached hereto as Exhibit E.
(zz) The definition of "Unrestricted Non-Recourse Debt" is hereby
amended to read in its entirety as follows:
"Unrestricted Non-Recourse Debt" of the Company or any of its
Subsidiaries means (i) Debt of such Person that is secured solely
(other than with respect to clause (ii) below) by a Lien upon the
stock of an Unrestricted Subsidiary of such Person and as to which
there is no recourse (other than with respect to clause (ii) below)
against such Person or any of its assets other than against such
stock (and the dollar amount of any Debt of such Person as
described in this clause (i) shall be deemed to be zero for
purposes of all other provisions of the Indenture) and (ii)
guarantees of the Debt of Unrestricted Subsidiaries of such Person;
provided, that the aggregate of all Debt of such Person Incurred
and outstanding pursuant to clause (ii) of this definition,
together with all Permitted Investments (net of any return on such
Investment) in Unrestricted Subsidiaries of such Person, does not
exceed (x) (w)$25,000,000 in the case of TransTexas, (x) 20% of
TARC's Consolidated EBITDA since the Phase II Completion Date in
the case of TARC, (y) 20% of TCR Holding's Consolidated EBITDA
since the Phase II Completion Date in the case of TCR Holding or
(z) 20% of TransContinental's consolidated EBITDA since the Phase
II Completion Date in the case of TransContinental plus in the case
of clause (ii) of this definition of Unrestricted Non- Recourse
Debt, Restricted Payments permitted to be made pursuant to clauses
(i) or (ii), as applicable, of Section 4.3.
Section 1.02. Section 4.3 of the Original Indenture. Section 4.3 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 4.3 Limitation on Restricted Payments. The Company shall
not, and shall not permit any of its Subsidiaries (other than any
of the TTXD Entities after the TTXD Spin- off) to, directly or
indirectly, make any dividend or other distribution on shares of
Capital Stock of the Company or any Subsidiary of the Company or
make any payment on account of the purchase, redemption, or other
acquisition or retirement for value of any such shares of Capital
Stock (except (x) to TransTexas by any of its Subsidiaries or (y)
to TARC by any of its Subsidiaries) unless such dividends,
distributions, or payments are made in cash or Capital Stock or a
combination thereof (other than the TTXD Spin-off or a dividend of
the common stock of TransTexas by TARC to the Company). In
addition, the Company shall not, and shall not permit any of its
Subsidiaries (other than any of the TTXD Entities after the TTXD
Spin-off) to, directly or indirectly, make any Restricted Payment;
provided, however, that TransTexas, TARC or TCR Holding may make a
Restricted Payment if, at the time or after giving effect thereto
on a pro forma basis no Default or Event of Default would occur or
be continuing, and:
(i) in the case of Restricted Payments by TransTexas:
(a) the Consolidated Fixed Charge Coverage Ratio of
TransTexas exceeds 2.25 to 1;
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(b) TransTexas' Adjusted Consolidated Tangible Assets
are equal to or greater than 150% of the total consolidated
principal amount or accreted value, as the case may be, of
Debt of TransTexas and its Subsidiaries (excluding, for
purposes of the calculation of Debt, any Swap Obligations);
and
(c) the aggregate amount of all Restricted Payments
made by TransTexas and its Subsidiaries, including such
proposed Restricted Payment and all payments that may be made
pursuant to the proviso at the end of this sentence (if not
made in cash, then the fair market value of any property used
therefor) from and after the Issue Date and on or prior to the
date of such Restricted Payment, would not exceed the sum of
(x) 25% of Adjusted Consolidated Net Income of TransTexas
accrued for the period (taken as one accounting period),
commencing with the first full fiscal quarter that commenced
after the Issue Date, to and including the fiscal quarter
ended immediately prior to the date of each calculation (or,
in the event Adjusted Consolidated Net Income for such period
is a deficit, then minus 100% of such deficit), minus (y) 100%
of the amount of any write-downs, write-offs, other negative
revaluations, and other negative extraordinary charges not
otherwise reflected in Adjusted Consolidated Net Income of
TransTexas during such period, plus (z) the aggregate Net
Proceeds received by TransTexas from the issuance or sale
(other than to the Company or a Subsidiary of the Company) of
its Qualified Capital Stock from and after the Issue Date and
on or prior to the date of such Restricted Payment); or
(ii) in the case of Restricted Payments by TARC:
(a) TARC's Consolidated Fixed Charge Coverage Ratio
exceeds 2.25 to 1; and
(b) the aggregate amount of all Restricted Payments
made by all of the TARC Entities, including such proposed
Restricted Payment and all payments that may be made pursuant
to the proviso at the end of this sentence (if not made in
cash, then the fair market value of any property used
therefor), from and after the Issue Date and on or prior to
the date of such Restricted Payment, would not exceed an
amount equal to (x) 25% of Adjusted Consolidated Net Income of
TARC accrued for the period (taken as one accounting period)
from the first full fiscal quarter that commenced after the
Issue Date to and including the fiscal quarter ended
immediately prior to the date of each calculation for which
financial statements are available (or, if TARC's Adjusted
Consolidated Net Income for such period is a deficit, then
minus 100% of such deficit), plus (y) the aggregate Net
Proceeds received by TARC from the issuance or sale (other
than to the Company or a Subsidiary of the Company) of its
Qualified Capital Stock from and after the Issue Date and on
or prior to the date of such Restricted Payment, minus (z)
100% of the amount of any write-downs, write-offs, other
negative revaluations, and other negative extraordinary
charges not otherwise reflected in TARC's Adjusted
Consolidated Net Income during such period; or
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(iii) in the case of Restricted Payments by TCR Holding:
(a) TCR Holding's Consolidated Fixed Charge Coverage
Ratio exceeds 2.25 to 1; and
(b) the aggregate amount of all Restricted Payments
made by all of the TCR Holding Entities, including such
proposed Restricted Payment and all payments that may be made
pursuant to the proviso at the end of this sentence (if not
made in cash, then the fair market value of any property used
therefor), from and after the Transaction Closing Date and on
or prior to the date of such Restricted Payment, would not
exceed an amount equal to the sum of (w) $1,000,000, plus (x)
50% of Adjusted Consolidated Net Income of TCR Holding accrued
for the period (taken as one accounting period) from the first
full fiscal quarter that commenced after the Transaction
Closing Date to and including the fiscal quarter ended
immediately prior to the date of each calculation for which
financial statements are available (or, if TCR Holding's
Adjusted Consolidated Net Income for such period is a deficit,
then minus 100% of such deficit), plus (y) the aggregate Net
Proceeds received by TCR Holding from the issuance or sale
(other than to the Company or a Subsidiary of the Company) of
its Qualified Capital Stock from and after the Transaction
Closing Date and on or prior to the date of such Restricted
Payment, minus (z) 100% of the amount of any write-downs,
write-offs, other negative revaluations, and other negative
extraordinary charges not otherwise reflected in TCR Holding's
Adjusted Consolidated Net Income during such period;
provided, that nothing in this Section 4.3 shall prohibit the
payment of any dividend within 60 days after the date of its
declaration if such dividend could have been made on the date
of its declaration in compliance with the foregoing
provisions.
Section 1.03. Section 4.6 of the Original Indenture. Section 4.6(b) of
the Original Indenture is hereby amended to read in its entirety as follows:
(b) Each of the Company and its Subsidiaries shall provide, or
shall cause to be provided, for itself and each of its Subsidiaries,
insurance (including appropriate self-insurance) against loss or
damage of the kinds that, in its reasonable, good faith opinion, are
adequate and appropriate for the conduct of its business and the
business of such Subsidiaries in a prudent manner, with reputable
insurers or with the government of the United States of America or an
agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as is customary, in its reasonable,
good faith opinion, and adequate and appropriate for the conduct of
its business and the business of its Subsidiaries in a prudent manner
for companies engaged in a similar business. In addition, all such
insurance shall be payable to the Trustee as loss payee, as its
interests may appear, under a "standard" or "Texas" loss payee clause.
Without limiting the foregoing, each of the Company and its
Subsidiaries shall (i) keep all of its physical property insured with
hazard insurance on an "all risks" basis, with broad form flood and
earthquake coverages and electronic data processing coverage, with a
full replacement cost endorsement and an "agreed amount" clause in an
amount equal to 100% of the full replacement cost of such property,
(ii) maintain all such workers' compensation or similar insurance as
may be required by law and (iii) maintain, in amounts and with
deductibles
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equal to those generally maintained by businesses engaged in similar
activities in similar geographic areas, general public liability
insurance against claims of bodily injury, death or property damage
occurring on, in or about the properties of the Company and its
Subsidiaries.
Section 1.04. Section 4.7 of the Original Indenture. Section 4.7(d) of the
Original Indenture is hereby deleted.
Section 1.05. Section 4.10 of the Original Indenture.
(a) Section 4.10(a) of the Original Indenture is hereby amended to read in
its entirety as follows:
(a) The Company shall not, and shall not permit any of its
Subsidiaries (other than any of the TTXD Entities after the date of
the TTXD Spin-off) to, enter directly or indirectly into, or permit to
exist, any transaction or series of related transactions with any
Related Person (excluding any Related Person which is a Related Person
solely because the party engaging in such transaction has the ability
to control the Related Person under the definition of "Control"
contained within the definition of "Related Person") (including,
without limitation: (i) the sale, lease, transfer or other disposition
of properties, assets or securities to such Related Person, (ii) the
purchase or lease of any property, assets or securities from such
Related Person, (iii) an Investment in such Related Person (excluding
Investments permitted to be made pursuant to clauses (iii), (vi),
(viii), (x), (xii), (xiii), (xv), (xvi), (xvii), (xix), (xx), (xxii),
(xxiii), (xxiv), (xxvi) or (xxix) of the definition of "Permitted
Investment"), and (iv) entering into or amending any contract or
agreement with or for the benefit of a Related Person (each, a
"Related Person Transaction")), except for (A) permitted Restricted
Payments, including for this purpose the transactions excluded from
the definition of Restricted Payments by the proviso contained in the
definition of "Restricted Payments", (B) transactions made in good
faith, the terms of which are (x) fair and reasonable to the Company
or such Subsidiary, as the case may be, and (y) at least as favorable
as the terms which could be obtained by the Company or such
Subsidiary, as the case may be, in a comparable transaction made on an
arm's length basis with Persons who are not Related Persons, (C)
transactions, (w) between the Company and any of its Wholly Owned
Subsidiaries or transactions between Wholly Owned Subsidiaries of the
Company, (x) among the TTXD Entities, (y) among the TARC Entities, or
(z) among the TransTexas Entities, (D) transactions pursuant to the
Services Agreement, the Tax Allocation Agreement, the Gas Purchase
Agreement, including amendments thereto that are approved by each of
the parties thereto, the Intercompany Loans, the Security Documents,
the Transfer Agreement and the Registration Rights Agreements, (E) the
lease of office space to the Company or an Affiliate of the Company by
TransAmerican or an Affiliate of TransAmerican, provided that payments
thereunder do not exceed in the aggregate $2,000,000 per year, (F) any
sale and leaseback or other transfer of TransTexas' headquarters
building located at 0000 Xxxxx Xxx Xxxxxxx Xxxxxxx Xxxx, Xxxxxxx,
Xxxxx, (G) any employee compensation arrangement in an amount which
together with the amount of all other cash compensation paid to such
employee by the Company and its Subsidiaries does not provide for cash
compensation in excess of $2,000,000 in any fiscal year of the Company
or any Subsidiary and which has been approved by a majority of the
Company's
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Independent Directors and found in good faith by such directors to be
in the best interests of the Company or such Subsidiary, as the case
may be, (H) loans to TARC, TCR Holding and TransTexas which are
permitted to be Incurred pursuant to the terms of Section 4.11; (I)
the amounts payable by the Company and its Subsidiaries to Southeast
Contractors for employee services provided to TARC or TransContinental
not exceeding the actual costs to Southeast Contractors of the
employees, which costs consist solely of payroll and employee
benefits, plus related administrative costs and an administrative fee,
not exceeding $2,000,000 per year in the aggregate; (J) the Company
and its Subsidiaries may pay a management fee to TransAmerican in an
amount not to exceed $2,500,000 per year; (K) transactions effected
pursuant to the Bridge Financing Transaction, including without
limitation (w) the borrowing by TARC from the Company of up to $25
million on substantially the same terms as the Bridge Loan Notes, (x)
the repayment thereof, (y) the pledge of the TARC Collateral as
security therefor and (z) the execution, delivery and performance of
an agreement pursuant to which the Company would direct TransTexas to
make payments on the TransTexas Intercompany Loan, during the period
that the Bridge Loan Notes remain outstanding, to an account which
will be dedicated to payments on the Bridge Loan Notes; (L)
transactions effected pursuant to the Transaction, including without
limitation (i) the execution, delivery and performance of the TARC
Intercompany Loan Amendment, the TransTexas Intercompany Loan
Amendment, the TransTexas Security Agreement Amendment, the TCR
Holding Pledge Agreement, an amendment of the Services Agreement and a
Stock Purchase Agreement among TARC, TCR Holding, TransContinental,
the Company and certain of the Purchasers providing for the sale to
such Purchasers of Capital Stock of TCR Holding owned by TARC pursuant
to the Transaction, (ii) the transfer of the Refinery Assets by TARC
to TCR Holding and, as consideration therefor, the issuance by TCR
Holding to TARC of Capital Stock of TCR Holding, the assumption by TCR
Holding of certain debt and obligations of TARC (including Debt of
TARC to the Purchasers and certain others), and (iii) the transfer of
the Refinery Assets by TCR Holding to TransContinental and, as
consideration therefor, the issuance by TransContinental of its common
stock to TCR Holding and the assumption by TransContinental of certain
debt and obligations of TCR Holding; (M) the delivery of Notes to the
Company in satisfaction of the TARC Intercompany Loan; (N) the
issuance and sale of the TCR Holding Participating Preferred Stock;
(O) the delivery by TransTexas of Notes to the Company in satisfaction
of the TransTexas Intercompany Loan, and the delivery of such Notes to
the Company in partial satisfaction of the TransTexas Intercompany
Loan; (P) transactions between or among TCR Holding or
TransContinental and any of their respective Related Persons, provided
such transaction is approved by the Board of Directors of each of the
parties thereto; and (Q) the TCR Holding Participating Preferred Stock
Redemption.
Notwithstanding the foregoing, the Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly (excluding
clauses (I) and (J) of Section 4.10(a)), loan or advance any funds to
Xxxx X. Xxxxxxx, and the aggregate amount of total compensation to
Xxxx X. Xxxxxxx shall not exceed (i) $1,000,000 per year in the
aggregate from the Company and TransTexas and (ii) $1,000,000 in the
aggregate from TARC and TCR Holding.
(b) Section 4.10(b) of the Original Indenture is hereby amended to read in
its entirety as follows:
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(b) Without limiting the foregoing, except for sales of
accounts receivable to an Accounts Receivable Subsidiary in accordance
with Section 4.20, (i) with respect to any Related Person Transaction
or series of Related Person Transactions (other than any Related
Person Transaction described in clause (A) (with respect to Permitted
Restricted Payments by virtue of clauses (i), (ii), (iv)-(xii), (xiv),
(xv), (xvi) and (xvii) of the proviso contained in the definition of
"Restricted Payments"), (C), (D), (E), (F), (H), (K), (L), (M), (N),
(O), (P) or (Q) of Section 4.10(a)) with an aggregate value in excess
of $1,000,000, such transaction must first be approved by a majority
of the Board of Directors of the Company or its Subsidiary which is
the transacting party and a majority of the directors of such entity
who are disinterested in the transaction pursuant to a Board
Resolution, as (x) fair and reasonable to the Company or such
Subsidiary, as the case may be, and (y) on terms which are at least as
favorable as the terms which could be obtained by the Company or such
Subsidiary, as the case may be, on an arm's length basis with Persons
who are not Related Persons, and (ii) with respect to any Related
Person Transaction or series of related Person Transactions (other
than any Related Person Transaction described in clause (A) (with
respect to permitted Restricted Payments by virtue of clauses (i),
(ii), (iv)-(xii), (xiv), (xv), (xvi) and (xvii) of the proviso
contained in the definition of "Restricted Payments") (C), (D), (E),
(F), (G), (H), (K), (L), (M), (N), (O), (P) or (Q) of Section 4.10(a))
with an aggregate value in excess of $5,000,000, the Company must
first obtain a favorable written opinion as to the fairness of such
transaction to the Company or such Subsidiary, as the case may be,
from a financial point of view, from a nationally recognized
investment banking or accounting firm; provided that such opinion
shall not be necessary if approval of the Board of Directors to such
Related Person Transaction has been obtained after receipt of bona
fide bids of at least two other independent parties and such Related
Person Transaction is in the ordinary course of business.
Section 1.06. Section 4.11 of the Original Indenture.
(a) The first paragraph of Section 4.11 of the Original Indenture is
hereby amended to read in its entirety as follows:
Section 4.11 Limitation on Incurrences of Additional Debt and
Issuances of Disqualified Capital Stock. Except as set forth in this
Section 4.11, from and after the Issue Date, the Company shall not,
and shall not permit any of its Subsidiaries or TransContinental
(other than any of the TTXD Entities after the TTXD Spin-off) to,
directly or indirectly, create, incur, assume, guarantee, or otherwise
become liable for, contingently or otherwise (to "Incur" or, as
appropriate, an "Incurrence"), any Debt or issue any Disqualified
Capital Stock, except:
(b) Section 4.11(1)(g) of the Original Indenture is hereby amended to
read in its entirety as follows:
(g) TransTexas may Incur Debt as an extension, renewal,
replacement, or refunding of any item of the Debt permitted to be
Incurred by clauses (m) or (o) hereof, or this clause (g) (each such
item of Debt is referred to as "Pre-Phase I TransTexas Refinancing
Debt"), provided, that (1) the maximum principal amount of each item
of Pre-Phase I TransTexas Refinancing Debt (or, if such Pre-Phase I
TransTexas Refinancing Debt is issued with
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original issue discount, the original issue price of such Pre-Phase I
TransTexas Refinancing Debt) permitted under this clause (g) may not
exceed the lesser of (x) the principal amount of the item of Debt
being extended, renewed, replaced, or refunded plus reasonable
financing fees and other associated reasonable out-of-pocket expenses
including consent payments, premium, if any, and related fees, in each
case other than those paid to a Related Person (collectively,
"Refinancing Fees"), or (y) if such item of Debt being extended,
renewed, replaced, or refunded was issued at an original issue
discount, the original issue price, plus amortization of the original
issue discount as of the time of the Incurrence of the Pre-Phase I
TransTexas Refinancing Debt plus Refinancing Fees, (2) each item of
Pre- Phase I TransTexas Refinancing Debt has a Weighted Average Life
and a final maturity that is equal to or greater than the related Debt
being extended, renewed, replaced, or refunded at the time of such
extension, renewal, replacement, or refunding and (3) each item of
Pre- Phase I TransTexas Refinancing Debt shall rank with respect to
the Notes and the TransTexas Intercompany Loan to an extent no less
favorable in respect thereof to the Holders than the related Debt
being refinanced;
(c) Section 4.11(1)(r) of the Original Indenture is hereby amended to read in
its entirety as follows:
(r) Debt of TransTexas owed to the Company which together with
any Debt incurred pursuant to clauses (2)(p), (3)(v) and (4)(t) hereof
does not in the aggregate exceed $50,000,000 principal amount
outstanding at any one time; provided that such Debt must have a
maturity date which is not after the maturity date of the Notes; and
provided further, that such loan must bear cash interest at a rate of
11.616% per annum.
(d) The first paragraph of Section 4.11(2) of the Original Indenture is
hereby amended to read in its entirety as follows:
(2) in the case of TARC, TCR Holding, TransContinental or any
of their Subsidiaries prior to the earlier to occur of (x) the Phase I
Completion Date or (y) the Notes being rated "B2" or better by Xxxxx'x
Investors Services, Inc. or "BB" or better by Standard and Poor's
Corporation, Inc.:
(e) Section 4.11(2)(b) of the Original Indenture is hereby amended to read
in its entirety as follows:
(b) Subordinated Debt of TARC solely to any wholly owned
Subsidiary of TARC, Debt of TCR Holding solely to TransContinental or
any wholly owned Subsidiary of TCR Holding, Debt or Disqualified
Capital Stock of TCR Holding to TARC, Debt of any wholly owned
Subsidiary of TARC solely to TARC or to any wholly owned Subsidiary of
TARC or Debt of TransContinental or any wholly owned Subsidiary of TCR
Holding solely to TCR Holding or to any wholly owned Subsidiary of TCR
Holding;
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(f) Section 4.11(2)(c) of the Original Indenture is hereby amended to read
in its entirety as follows:
(c) Debt of TransContinental outstanding at any time in an
aggregate principal amount not to exceed the greater of (x)
$100,000,000 or (y) the TransContinental Borrowing Base, less, in each
case, the amount of any Debt of an Accounts Receivable Subsidiary
(other than Debt owed to TransContinental).
(g) Section 4.11(2)(h) of the Original Indenture is hereby amended to read
in its entirety as follows:
(h) Debt represented by trade payables or accrued expenses, in
each case, incurred on normal, customary terms in the ordinary course
of business, not overdue for a period of more than 90 days (or, if
overdue for a period of more than 90 days, being contested in good
faith and by appropriate proceedings and adequate reserves with
respect thereto being maintained on the books of the obligor thereon
in accordance with GAAP) and not constituting any amounts due to banks
or other financial institutions;
(h) Section 4.11(2)(i) of the Original Indenture is hereby amended to read
in its entirety as follows:
(i) Swap Obligations;
(i) Section 4.11(2)(j) of the Original Indenture is hereby amended to read
in its entirety as follows:
(j) Unrestricted Non-Recourse Debt;
(j) Section 4.11(2)(p) of the Original Indenture is hereby amended to read
in its entirety as follows:
(p) Debt of TARC, TCR Holding or TransContinental owed to the
Company which together with any Debt Incurred pursuant to clauses
(1)(r), (3)(v) and (4)(t) hereof does not in the aggregate exceed
$50,000,000 principal amount outstanding at any one time; provided
that such Debt must have a maturity date which is not after the
maturity date of the Notes; and provided further, that such loan must
bear cash interest at the rate of 11.616% per annum;
(k) Section 4.11(2)(q) of the Original Indenture is hereby amended to read
in its entirety as follows:
(q) each of TARC, TCR Holding and TransContinental may Incur
Debt as an extension, renewal, replacement, or refunding of any item
of the Debt permitted to be Incurred by clauses (e), (1), (r), (v),
(w) or (x) hereof, or this clause (q) (each such item of Debt is
referred to as "Pre-Phase I TARC Refinancing Debt"), provided, that
(1) the maximum principal amount of each item of Pre-Phase I TARC
Refinancing Debt (or, if such Pre-Phase I TARC Refinancing Debt is
issued with original issue discount, the original issue price of such
Pre-Phase I TARC Refinancing Debt) permitted under this clause (q) may
not exceed the lesser of (x) the principal amount of the item of Debt
being extended, renewed, replaced, or refunded plus Refinancing Fees
or (y) if such item of Debt being
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extended, renewed, replaced, or refunded was issued at an original
issue discount, the original issue price, plus amortization of the
original issue discount as of the time of the Incurrence of the
Pre-Phase I TARC Refinancing Debt plus Refinancing Fees, (2) each item
of Pre-Phase I TARC Refinancing Debt has a Weighted Average Life and a
final maturity that is equal to or greater than the related Debt being
extended, renewed, replaced, or refunded at the time of such
extension, renewal, replacement, or refunding and (3) each item of
Pre-Phase I TARC Refinancing Debt shall rank with respect to the Notes
and the TARC Intercompany Loan to an extent no less favorable in
respect thereof to the Holders than the Related Debt being refinanced;
(l) Section 4.11(2) of the Original Indenture is hereby amended to add
subsections (t), (u), (v) (w), (x) and (y) thereto to read as follows:
(t) Debt of TARC, TCR Holding or TransContinental with an
aggregate principal amount outstanding at any one time of up to
$225,000,000;
(u) Debt of TARC which is assumed by TCR Holding or
TransContinental in connection with the Transaction;
(v) Subordinated Debt of TCR Holding with an aggregate
principal amount outstanding at any one time not in excess of
$200,000,000;
(w) Debt of TCR Holding (other than Debt incurred pursuant to
clause (t) above) which is assumed by TransContinental in connection
with the Transaction;
(x) Disqualified Capital Stock of TCR Holding or
TransContinental or unsecured Debt of TCR Holding or unsecured or
secured Debt of TransContinental (x) the proceeds of which are used to
repurchase Notes or (y) that is exchanged for Notes; and
(y) Debt or Disqualified Capital Stock of TCR Holding or
TransContinental that is used to refinance or replace the TARC
Intercompany Loan.
(m) Section 4.11(3)(j) of the Original Indenture is hereby amended to read
in its entirety as follows:
(j) TransTexas may Incur Debt as an extension, renewal,
replacement, or refunding of any item of the Debt permitted to be
Incurred by clauses (c), (j), (q) or (s) hereof, or the third
paragraph of this section or Debt permitted to be refinanced pursuant
to clause (l) (g) hereof (each such item of Debt is referred to as
"TransTexas Refinancing Debt"), provided, that (1) the maximum
principal amount of each item of TransTexas Refinancing Debt (or, if
such TransTexas Refinancing Debt is issued with original issue
discount, the original issue price of such TransTexas Refinancing
Debt) permitted under this subclause (j) may not exceed the lesser of
(x) the principal amount of the Debt being extended, renewed,
replaced, or refunded plus Refinancing Fees, or (y) if such Debt being
extended, renewed, replaced, or refunded was issued at an original
issue discount, the original issue price, plus amortization of the
original issue discount as of the time of the Incurrence of the
TransTexas Refinancing Debt plus Refinancing Fees, (2) each item of
TransTexas
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Refinancing Debt has a Weighted Average Life and a final maturity that
is equal to or greater than the related Debt being extended, renewed,
replaced, or refunded at the time of such extension, renewal,
replacement, or refunding and (3) each item of TransTexas Refinancing
Debt shall rank with respect to the Notes and the TransTexas
Intercompany Loan to an extent no less favorable in respect thereof to
the Holders than the related Debt being refinanced;
(n) Section 4.11(3)(v) of the Original Indenture is hereby amended to read
in its entirety as follows:
(v) Debt of TransTexas owed to the Company which together with
any Debt Incurred pursuant to clauses (1)(r), (2)(p) and (4)(t) hereof
does not in the aggregate exceed $50,000,000 principal amount
outstanding at any one time; provided that such Debt must have a
maturity date which is not after the maturity date of the Notes; and
provided further, that such loan must bear cash interest at a rate of
11.616% interest per annum.
(o) The first paragraph of Section 4.11(4) of the Original Indenture is
hereby amended to read in its entirety as follows:
(4) in the case of TARC, TCR Holding, TransContinental or any
of their Subsidiaries after the earlier to occur of (x) the Phase I
Completion Date or (y) the Notes being rated "B2" or better by Xxxxx'x
Investors Services, Inc. or "BB--" or better by Standard and Poor's
Corporation, Inc.:
(p) Section 4.11(4)(b) of the Original Indenture is hereby amended to read
in its entirety as follows:
(b) Subordinated Debt of TARC solely to any wholly owned
Subsidiary of TARC, Debt of TCR Holding solely to TransContinental or
any wholly owned Subsidiary of TCR Holding, Debt or Disqualified
Capital Stock of TCR Holding to TARC, Debt of any wholly owned
Subsidiary of TARC solely to TARC or to any wholly owned Subsidiary of
TARC or Debt of any wholly owned Subsidiary of TCR Holding solely to
TransContinental or TCR Holding or to any wholly owned Subsidiary of
TCR Holding;
(q) Section 4.11(4)(d) of the Original Indenture is hereby amended to read
in its entirety as follows:
(d) Debt of TransContinental outstanding at any time in an
aggregate principal amount not to exceed the greater of (x)
$100,000,000 or (y) the TransContinental Borrowing Base, less, in each
case, the amount of any Debt of an Accounts Receivable Subsidiary
(other than Debt owed to TransContinental) and any Debt outstanding
pursuant to clause (c) of clause (2) above;
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(r) Section 4.11(4)(j) of the Original Indenture is hereby amended to read
in its entirety as follows:
(j) each of TARC, TCR Holding and TransContinental may Incur
Debt as an extension, renewal, replacement, or refunding of any item
of the Debt permitted to be Incurred by clauses (c) or (g) above, the
fourth paragraph of this section, this clause (j), clauses (o), (r),
(x), (y) or (z) below or Debt permitted to be refinanced pursuant to
clause (2)(q) hereof (each such item of Debt is referred to as "TARC
Refinancing Debt"), provided that (1) the maximum principal amount of
each item of TARC Refinancing Debt (or, if such TARC Refinancing Debt
is issued with original issue discount, the original issue price of
such TARC Refinancing Debt) permitted under this clause (j) may not
exceed the lesser of (x) the principal amount of the item of Debt
being extended, renewed, replaced, or refunded plus Refinancing Fees,
or (y) if such item of Debt being extended, renewed, replaced, or
refunded was issued at an original issue discount, the original issue
price, plus amortization of the original issue discount at the time of
the Incurrence of the TARC Refinancing Debt plus Refinancing Fees, (2)
each item of TARC Refinancing Debt has a Weighted Average Life and a
final maturity that is equal to or greater than the related Debt being
extended, renewed, replaced. or refunded at the time of such
extension, renewal, replacement, or refunding and (3) each item of
TARC Refinancing Debt shall rank with respect to the Notes and the
TARC Intercompany Loan to an extent no less favorable in respect
thereof to the Holders than the related Debt being refinanced;
(s) Section 4.11(4)(k) of the Original Indenture is hereby amended to read
in its entirety as follows:
(k) Debt represented by trade payables or accrued expenses, in
each case, incurred on normal, customary terms in the ordinary course
of business, not overdue for a period of more than 90 days (or, if
overdue for a period of more than 90 days, being contested in good
faith and by appropriate proceedings and adequate reserves with
respect thereto being maintained on the books of the obligor thereon
in accordance with GAAP) and not constituting any amounts due to banks
or other financial institutions;
(t) Section 4.11(4)(l) of the Original Indenture is hereby amended to read
in its entirety as follows:
(l) Swap Obligations;
(u) Section 4.11(4)(m) of the Original Indenture is hereby amended to read
in its entirety as follows:
(m) Unrestricted Non-Recourse Debt;
(v) Section 4.11(4)(r) of the Original Indenture is hereby amended to read
in its entirety as follows:
(r) Debt of TransContinental Incurred in connection with the
acquisition, construction or improvement of a CATOFIN(R) Unit not in
excess of 20% of TransContinental's Consolidated EBITDA accrued for
the period (taken as one accounting period) commencing with the first
full fiscal quarter that commenced after the Phase I Completion Date,
to and including the fiscal quarter ended immediately prior to the
date
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of such calculation, provided, that, no such Debt may be Incurred
unless (i) the Phase II Completion Date has occurred or (ii) the
Construction Supervisor shall have provided the Trustee with written
certification that, based upon its bi-monthly evaluation of the
Capital Improvement Program, the amounts remaining in the disbursement
accounts to complete Phase II are sufficient to complete Phase II in
accordance with the Plans approved by the Construction Supervisor;
(w) Sections 4.11(4)(s) and (t) of the Original Indenture are hereby
amended to read in their entirety as follows:
(s) Debt of TARC or any of its Subsidiaries owed to the
Company which is loaned pursuant to terms of the fourth paragraph of
either Section 4.21 or 4.24;
(t) Debt of TARC, TCR Holding or TransContinental owed to the
Company which together with any Debt Incurred pursuant to clauses
(1)(r), (2)(p) and (3)(v) hereof does not in the aggregate exceed
$50,000,000 principal amount outstanding at any one time; provided
that such Debt must have a maturity date which is not after the
maturity date of the Notes; and provided further, that such loan must
bear cash interest at the rate of 11.616% per annum;
(x) Section 4.11(4) of the Original Indenture is hereby amended to add
subsections (u), (v), (w), (x) (y) and (z) to read in their entirety as
follows:
(u) Debt of TransContinental with an aggregate principal
amount of up to $225,000,000 outstanding at any one time;
(v) Debt of TARC which is assumed by TCR Holding or
TransContinental in connection with the Transaction;
(w) Subordinated Debt of TCR Holding with an aggregate
principal amount outstanding at any one time not in excess of
$200,000,000;
(x) Debt of TCR Holding (other than Debt incurred pursuant to
clause (u) above) which is assumed by TransContinental in connection
with the Transaction;
(y) Disqualified Capital Stock of TCR Holding or
TransContinental or unsecured Debt of TCR Holding or unsecured or
secured Debt of TransContinental (x) the proceeds of which are used to
repurchase Notes or (y) that is exchanged for Notes; and
(z) Debt or Disqualified Capital Stock of TCR Holding or
TransContinental that is used to refinance or replace the TARC
Intercompany Loan.
(y) Section 4.11(5)(e) of the Original Indenture is hereby amended to read
in its entirety as follows:
(e) The Company may Incur Debt as an extension, renewal,
replacement, or refunding of any item of the Debt permitted to be
Incurred by subclauses (d) hereof, or this
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subclause (e) (each such item of Debt is referred to as "TEC
Refinancing Debt"), provided, that (1) the maximum principal amount of
each item of TEC Refinancing Debt (or, if such TEC Refinancing Debt is
issued with original issue discount, the original issue price of such
Refinancing Debt) permitted under this subclause (e) may not exceed
the lesser of (x) the principal amount of the item of Debt being
extended, renewed, replaced, or refunded plus Refinancing Fees, or (y)
if such item of Debt being extended, renewed, replaced, or refunded
was issued at an original issue discount, the original issue price,
plus amortization of the original issue discount as of the time of the
Incurrence of the TEC Refinancing Debt plus Refinancing Fees, (2) each
item of TEC Refinancing Debt has a Weighted Average Life and a final
maturity that is equal to or greater than the related Debt being
extended, renewed, replaced, or refunded at the time of such
extension, renewal, replacement, or refunding and (3) each item of TEC
Refinancing Debt shall rank with respect to the Notes to an extent no
less favorable in respect thereof to the Holders than the related Debt
being refinanced.
(z) The third to last and second to last paragraphs of Section 4.11 of the
Original Indenture are hereby amended to read in their entirety as follows:
Notwithstanding the foregoing provisions of this covenant, (a)
TARC, TCR Holding and TransContinental may Incur Senior Debt and TARC,
TCR Holding and TransContinental may issue Disqualified Capital Stock
if, at the time such Senior Debt is Incurred or such Disqualified
Capital Stock is issued, (i) no Default or Event of Default shall have
occurred and be continuing at the time or immediately after giving
effect to such transaction on a pro forma basis, and (ii) immediately
after giving effect to the Consolidated Fixed Charges in respect of
such Debt being Incurred or such Disqualified Capital Stock being
issued and the application of the proceeds therefrom to the extent
used to reduce Debt or Disqualified Capital Stock, on a pro forma
basis, the Consolidated Fixed Charge Coverage Ratio of the entity
incurring such Debt for the Reference Period is greater than 2.5 to 1,
and (b) TARC, TCR Holding and TransContinental may Incur Subordinated
Debt if, at the time such Subordinated Debt is incurred, (i) no
Default or Event of Default shall have occurred and be continuing at
the time or immediately after giving effect to such transaction on a
pro forma basis, and (ii) immediately after giving effect to the
Consolidated Fixed Charges in respect of such Subordinated Debt being
incurred and the application of the proceeds therefrom to the extent
used to reduce Debt, on a pro forma basis, the Consolidated Fixed
Charge Coverage Ratio of the entity incurring such Debt for the
Reference Period is greater than 2.0 to 1.
Debt Incurred and Disqualified Capital Stock issued by any
Person that is not a Subsidiary of TransTexas, TARC, TCR Holding or
TransContinental, as the case may be, which Debt or Disqualified
Capital Stock is outstanding at the time such Person becomes a
Subsidiary of, or is merged into, or consolidated with TransTexas,
TARC, TCR Holding or TransContinental or one of their Subsidiaries, as
the case may be, shall be deemed to have been Incurred or issued, as
the case may be, at the time such Person becomes a Subsidiary of, or
is merged into, or consolidated with TransTexas, TARC, TCR Holding or
TransContinental, respectively, or one of their respective
Subsidiaries.
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Section 1.07. Section 4.12 of the Original Indenture. Section 4.12 of
the Original Indenture is hereby amended to read in its entirety as follows:
Section 4.12. Limitations on Restricting Subsidiary Dividends.
The Company shall not, and shall not permit any of its Subsidiaries
(other than TARC, TCR Holding, TransTexas or any of the TTXD Entities)
to, directly or indirectly, create, assume, or suffer to exist any
consensual encumbrance or restriction on the ability of any Subsidiary
of the Company (other than TARC, TCR Holding, TransTexas or any of the
TTXD Entities) to pay dividends or make other distributions on the
Capital Stock of any Subsidiary of the Company, except encumbrances
and restrictions existing under this Indenture and any agreement of a
Person acquired by the Company or a Subsidiary of the Company, which
restrictions existed at the time of acquisition, were not put in place
in anticipation of such acquisition and are not applicable to any
Person or property, other than the Person or any property of the
Person so acquired. Notwithstanding anything contained herein to the
contrary, neither TARC, TCR Holding nor TransTexas may create an
encumbrance or restriction on their ability to pay premium, if any,
principal of, or interest on, the Intercompany Loans.
Section 1.08. Section 4.13 of the Original Indenture. Section 4.13 of
the Original Indenture is hereby amended to read in its entirety as follows:
Section 4.13 Limitation on Liens. The Company shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly,
Incur, or suffer to exist any Lien upon any of its respective property
or assets, whether now owned or hereafter acquired which property or
assets constitute Collateral, other than (a) in the case of the
Company, Permitted TEC Liens, (b) in the case of any of the TARC
Entities, Permitted TARC Liens, and (c) in the case of TransTexas,
Permitted TransTexas Liens. Notwithstanding anything in this Indenture
to the contrary, (i) TARC shall not, directly or indirectly, incur or
suffer to exist any Lien on the Capital Stock of TCR Holding owned by
it (other than to secure the TARC Intercompany Loan), (ii) TCR Holding
may incur a Lien on Capital Stock of TransContinental to secure the
TARC Working Capital Loan and (iii) TransContinental shall not be
bound by this Section 4.13. For the purpose of determining compliance
with this Section 4.13, if a Lien meets the criteria of more than one
of the types of Permitted Liens, the Company or the Subsidiary in
question shall have the right to determine in its sole discretion the
category of Permitted Lien to which such Lien applies, shall not be
required to include such Lien in more than one of such categories, and
may elect to apportion such Lien between or among any two or more
categories otherwise applicable.
Section 1.09. Section 4.14 of the Original Indenture.
(a) Section 4.14(a) of the Original Indenture is hereby amended to read in
its entirety as follows:
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, consummate an Asset Sale unless (A) an amount equal
to the Net Cash Proceeds therefrom is (i) in the case of an Asset Sale
by the Company, applied as described under Section 4.21, (ii) in the
case of an Asset Sale by one of the TransTexas Entities, applied to an
Intercompany Loan Redemption of the TransTexas Intercompany Loan,
(iii) in the case of an Asset Sale by one of the TARC Entities,
applied to an Intercompany Loan Redemption of the TARC Intercompany
Loan, (iv) used to make cash payments in the ordinary course of
business and consistent with past practices that are not otherwise
prohibited by this
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Indenture, provided that the aggregate amount so used pursuant to this
clause (iv) from and after the Issue Date does not exceed $25,000,000
with respect to TransTexas, or $15,000,000 with respect to the TARC
Entities (without duplication of amounts used to acquire any Capital
Assets in accordance with clauses (v), (vi) and (vii) of this
paragraph (a) below), (v) with respect to an Asset Sale by TransTexas
or any of its Subsidiaries (x) to the extent such Asset Sale occurs
prior to the payment in full of the TransTexas Intercompany Loan (and
any other loans from the Company pursuant to clauses (xvii) or (xxvii)
of the definition of "Permitted Investment") and includes proved
reserve assets, used for Capital Expenditures in a Related TransTexas
Business within 180 days after the date of such Asset Sale, provided
that TransTexas' most recent Reserve Report indicates that TransTexas
and its Subsidiaries, after giving effect to the Asset Sale and to the
addition of proved reserves associated with any assets acquired in
connection with such Asset Sale, have proved reserves as indicated on
the most recent Reserve Report at least equal to (1) if such sale
occurs during the fiscal year ending January 31, 1998, 450 Bcfe of
natural gas, (2) if such sale occurs during the fiscal year ending
January 31, 1999, 500 Bcfe of natural gas or with an SEC PV 10 of at
least $600,000,000 and (3) if such sale occurs during the fiscal year
ending January 31, 2000 or thereafter, 600 Bcfe of natural gas or with
an SEC PV 10 of at least $700,000,000, or (y) to the extent such Asset
Sale occurs substantially contemporaneously with or after the payment
in full of the TransTexas Intercompany Loan (and any other loan to
TransTexas from the Company pursuant to clauses (xvii) or (xxviii) of
the definition of "Permitted Investment") or involves assets that do
not include proved reserves, used for Capital Expenditures in a
Related TransTexas Business within 180 days after the date of such
Asset Sale; (vi) with respect to an Asset Sale by TARC or any of its
Subsidiaries after the Phase II Completion Date, used for Capital
Expenditures in a Related TARC Business within 180 days after the date
of such asset sale; provided that, prior to the payment in full of the
TARC Intercompany Loan (and any other loan to TARC from the Company
pursuant to clauses (xvii) or (xxviii) of the definition of "Permitted
Investment"), the aggregate amount does not exceed $10,000,000, (vii)
with respect to an Asset Sale by TransTexas or TARC or any of their
Subsidiaries resulting from (x) the damage to or destruction of assets
for which insurance proceeds are paid or (y) condemnation, eminent
domain or similar type proceedings, in each case, used for Capital
Expenditures in a Related TransTexas Business (in the case of Asset
Sales by any of the TransTexas Entities) or a Related TARC Business
(in the case of Asset Sales by any of the TARC Entities) within 360
days after the date of such Asset Sale or (viii) with respect to an
Asset Sale by TCR Holding or any of its Subsidiaries, used to purchase
Notes; and (B) in the case of any Asset Sale or series of related
Asset Sales for total proceeds in excess of $5,000,000, at least 85%
of the value of the consideration for such Asset Sale consists of: (i)
cash, Cash Equivalents, Notes or Exchange Assets or any combination
thereof if such Asset Sale is by TARC or TCR Holding or any of their
respective Subsidiaries or (ii) cash, Cash Equivalents or Exchange
Assets or any combination thereof if such Asset Sale is by TransTexas
or any of its Subsidiaries.
(b) Section 4.14(b) of the Original Indenture is hereby amended to read in
its entirety as follows:
(b) Notwithstanding the foregoing limitations on Asset Sales
and restrictions on the use of Net Cash Proceeds therefrom:
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(i) TransTexas or any Subsidiary of TransTexas may convey,
sell, lease, transfer, or otherwise dispose of any or all of
its assets (upon voluntary liquidation or otherwise) to
TransTexas or a wholly owned Subsidiary of TransTexas;
(ii) TARC or any Subsidiary of TARC may convey, sell,
lease, transfer, or otherwise dispose of any or all of its
assets (upon voluntary liquidation or otherwise) to TARC or
any wholly owned Subsidiary of TARC;
(iii) the Company and its Subsidiaries may engage in Asset
Sales in the ordinary course of business;
(iv) the Company and its Subsidiaries may engage in Asset
Sales not otherwise permitted in clauses (i) through (iii) or
(v) through (xiii) of this sentence provided that the
aggregate proceeds from all such Asset Sales do not exceed
$5,000,000 in any twelve-month period;
(v) the Company and its Subsidiaries may engage in Asset
Sales pursuant to and in accordance with the provisions of
Article V;
(vi) the Company and its Subsidiaries may sell, assign,
lease, license, transfer, abandon or otherwise dispose of (a)
damaged, worn out, unserviceable or other obsolete property in
the ordinary course of business or (b) other property no
longer necessary for the proper conduct of their business;
(vii) TARC and its Subsidiaries may sell accounts
receivable to an Accounts Receivable Subsidiary in accordance
with the provisions described under Section 4.20;
(viii) TARC and its Subsidiaries may convey, sell, transfer
or otherwise dispose of crude oil and refined products in the
ordinary course of business;
(ix) the Company and its Subsidiaries may engage in Asset
Sales (a) the Net Cash Proceeds of which are used for payment
or prepayment of cash interest or dividend expense on the TCR
Holding Participating Preferred Stock on the Notes or the
Intercompany Loans up to an amount equal to the two next
ensuing interest payments payable under the relevant
obligation (less any amount previously prepaid for such
interest payments pursuant to this clause (ix)(a)), which
payment or prepayment must be made within 180 days of the
first regular interest payment date under the relevant
obligation following the consummation of the Asset Sale;
provided, that any Net Cash Proceeds not used or otherwise
designated within 60 days for a purpose or purposes permitted
by this Section 4.14 shall be deposited in a segregated
account designated for the purposes of paying or prepaying
principal of or interest on the Notes or Intercompany Loans or
dividend expense on the TCR Holding Participating Preferred
Stock, as applicable, (b) in connection with the settlement of
litigation or the payment of judgments or (c) the Net Cash
Proceeds of which are used in connection with the settlement
of litigation or for the payment of judgments; provided, that
the aggregate value of assets transferred pursuant to clauses
(b) and (c) above from and after the Issue Date does not
exceed $25,000,000;
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(x) TransTexas may sell, convey, contribute or otherwise
transfer the assets comprising the Related TTXD Business to
TTXD;
(xi) TARC may transfer the Port Facility Assets in
connection with the Port Commission Bond Financing;
(xii) TransTexas and its Subsidiaries may convey, sell,
transfer or otherwise dispose of Hydrocarbons or other mineral
products in the ordinary course of business;
(xiii) Prior to the TTXD Spin-off, TransTexas may sell,
transfer, contribute or otherwise dispose of the capital stock
of TTXD or the assets comprising the drilling and energy
services business and pipeline services business of TransTexas
provided that (a) in the case of a transfer, contribution or
other distribution to a company which has a class of equity
securities publicly traded on a national securities exchange
or on the NNM, (x) at least 50% of the value of the
consideration for such Asset Sale consists of cash and up to
50% of the value of the consideration for such Asset Sale may
consist of Capital Stock and (y) the Net Cash Proceeds from
such Asset Sale are applied pursuant to clause (a)(ii) of the
prior paragraph or (b) in the case of a transfer, contribution
or other distribution to a joint venture, partnership, limited
liability company or similar entity newly formed for the
purpose of this transfer, up to 100% of the value of the
consideration for such Asset Sale may consist of Capital Stock
or other equity interests in such entity; provided, that any
Net Cash Proceeds from such Asset Sale are applied pursuant to
clause (a)(ii) of the prior paragraph;
(xiv) The Company and TARC may sell shares of TransTexas
Common Stock in connection with a transaction contemplated by
the TransTexas Disbursement Agreement and clause (xii) of the
definition of "Restricted Payments;"
(xv) The Company may transfer all or any portion of its
voting rights with respect to Capital Stock of TransTexas
pursuant to the Bridge Financing Transaction;
(xvi) TARC may transfer the Refinery Assets to TCR Holding
and TCR Holding may transfer the Refinery Assets to
TransContinental;
(xvii) TARC may sell or otherwise transfer Capital Stock of
TCR Holding pursuant to the Transaction;
(xviii) TARC may sell or otherwise transfer Capital Stock
of TCR Holding in connection with a financing consummated to
provide funds to TransContinental, provided that TARC complies
with Section 4.9;
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(xix) TARC may sell or otherwise transfer Capital Stock of
TCR Holding owned by it pursuant to the TCR Holding
Participating Preferred Stock Redemption; and
(xx) Unless otherwise required by the foregoing clauses (i)
through (xviii), the proceeds of any Asset Sale permitted
thereby shall be used by the Company or its Subsidiaries for
purposes not otherwise prohibited by this Indenture.
(c) Section 4.14(c) of the Original Indenture is hereby amended to read in
its entirety as follows:
(c) The Company shall not, and shall not permit any of its
Subsidiaries to, consummate a Non-Collateral Asset Sale unless an
amount equal to the Net Cash Proceeds therefrom is used (i) to
purchase Notes within ninety (90) days after the date of such Non-
Collateral Sale in the case of Non-Collateral Asset Sales by any of
the TARC Entities or (ii) for Capital Expenditures in (A) a Related
TARC Business in the case of Non-Collateral Asset Sales by any of the
TARC Entities or (B) a Related TransTexas Business in the case of
Non-Collateral Asset Sales by any of the TransTexas Entities, in each
case within 180 days after the date of such Non-Collateral Asset Sale.
(d) New subsections Section 4.14(d) and (e) are hereby added to the
Original Indenture to follow subsection 4.14(c) to read in their entirety
as follows:
(d) For the purpose of determining compliance with this
Section 4.14 with respect to the application or use of the Net Cash
Proceeds of any Asset Sale consummated by the Company, any TARC
Entity, any TCR Holding Entity, any TransTexas Entity or any other
Subsidiary of the Company, if such Net Cash Proceeds would be eligible
for application or use under or pursuant to more than one of the
categories of application or use permitted under Section 4.14(a) or
Section 4.14(b), without, for purposes of determining such eligibility
only, giving effect to any specific limitation on the amount or the
aggregate amount of Net Cash Proceeds that may be applied or used
under any otherwise eligible category of application or use in effect
at the time such application is to be effected, the Person in question
consummating such Asset Sale shall have the right to determine in its
sole discretion the eligible category or categories of application or
use pursuant to which all or any portion of such Net Cash Proceeds
shall be applied or used, and may, at its option and in its sole
discretion, elect either (i) to effect the application or use of the
full amount of such Net Cash Proceeds pursuant to any one of such
eligible categories of application or use permitted under Section
4.14(a) or Section 4.14(b), subject, however, to any limitation on the
amount or the aggregate amount that may be applied or used under such
eligible category of application or use in effect at the time such
application or use is effected, or (ii) to effect the application or
use of such Net Cash Proceeds by apportioning the full amount of such
Net Cash Proceeds to be applied or used between or among any two or
more of such eligible categories of application or use permitted under
Section 4.14(a) or Section 4.14(b) in such amounts and order of
application or use as the Person in question consummating such Asset
Sale may determine in its sole discretion, subject, however, as to
each portion of such Net Cash Proceeds apportioned for application or
use under any one of such eligible categories of application or use,
to any limitation on the amount or the
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aggregate amount of Net Cash Proceeds that may be applied or used
under such eligible category of application or use in effect at the
time such application or use is effected.
(e) Notwithstanding anything in this Indenture to the
contrary, TARC shall not, directly or indirectly, convey, sell,
transfer or otherwise dispose of any of the Capital Stock of TCR
Holding owned by it except (i) pursuant to the Transaction, (ii)
pursuant to a sale of a majority of the Capital Stock of TCR Holding
or (iii) as permitted by Section 4.14(b)(xvii).
Section 1.10. Section 4.16 of the Original Indenture. The first paragraph of
Section 4.16 of the Original Indenture is hereby amended to read in its entirety
as follows:
Section 4.16 Guarantee by Subsidiaries. If, other than
pursuant to the Transaction, TARC or TransTexas or any of their
respective Subsidiaries shall make Investments in an aggregate amount,
or otherwise transfer (including by capital contribution) or cause to
be transferred, in a manner otherwise permitted pursuant to this
Indenture, any assets (tangible or intangible), businesses, divisions,
real property, or equipment having a book value as shown in the
Company's most recent consolidated balance sheet or the notes thereto
(or if greater, a fair market value at the time of transfer) in excess
of $1,000,000 in or to any Subsidiary of the Company (other than TARC)
that is not a Guarantor or an obligor on either the TransTexas
Intercompany Loan or the TARC Intercompany Loan, other than TTXD or
any Subsidiary of TTXD after the TTXD Spin-off, the Company shall (a)
cause such transferee Subsidiary to (x) guarantee payment of the
TransTexas Intercompany Loan, in the case of Subsidiaries of
TransTexas, or the TARC Intercompany Loan in the case of Subsidiaries
of TARC, by executing a Guarantee and (y) execute the appropriate
security document, in substantially the form of the relevant Security
Document attached hereto, necessary to grant a security interest in
all of the assets of such Subsidiary (other than Equipment, Inventory
and Receivables) to secure such Guarantee and (b) deliver to the
Trustee an Opinion of Counsel, in form reasonably satisfactory to the
Trustee, that such Guarantee is a valid, binding and enforceable
obligation of such Subsidiary, subject to customary exceptions for
bankruptcy, fraudulent transfer and equitable principles. If TARC or
TransTexas or any of their Subsidiaries shall subsequently sell or
otherwise transfer all of the Capital Stock of such Subsidiary held by
TARC, TransTexas or any of their Subsidiaries, the Guarantee required
hereby shall be withdrawn or cancelled. In addition, if the TTXD
Spin-off has occurred the Guarantee by TTXD or any of its Subsidiaries
shall be withdrawn or cancelled.
Section 1.11. Section 4.18 of the Original Indenture. Section 4.18 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 4.18 Limitations on Line of Business. The TransTexas
Entities shall not directly or indirectly engage to any substantial
extent in any line or lines of business activity other than a Related
TransTexas Business or such other business activities as are
reasonably related or incidental thereto. The Company shall not permit
TransContinental directly or indirectly to engage to any substantial
extent in any line or lines of business activity other than a Related
TARC Business or such other business activities as are reasonably
related or incidental thereto. Neither the Company nor any Affiliate
of Xxxx X.
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Xxxxxxx (xxxxx than Persons who are Affiliates solely by being
directors or Affiliates of directors of one or more companies
affiliated with Xxxx X. Xxxxxxx and other than TARC, TCR Holding,
TransContinental, TransTexas, TTXD or any of their Subsidiaries) may
engage to any substantial extent in any line or lines of business
activity that is a Related TransTexas Business. The Company shall not
have any direct Subsidiaries other than TARC, TTXD, TransTexas, an
Accounts Receivable Subsidiary, and any wholly owned Subsidiary formed
solely for the purpose of facilitating the reincorporation of TARC in
Delaware or the repurchase of the TARC Warrants.
Section 1.12. Section 4.21 of the Original Indenture. The first paragraph of
Section 4.21 of the Original Indenture is hereby amended to read in its entirety
as follows:
Not later than (x) 20 Business Days after any date on which
the Accumulated Amount (as defined below) exceeds $5,000,000, or (y)
if there is included in the Accumulated Amount any payments in respect
of an Intercompany Loan Redemption of the TransTexas Intercompany
Loan, then not later than 91 days after any date on which the
Accumulated Amount exceeds $5,000,000 after deducting any portion
thereof applied by the Company to purchase (and surrender to the
Trustee for cancellation) Notes pursuant to an Open Market Purchase
during the period ending the day prior to the end of such 91 day
period, the Company shall make an irrevocable, unconditional offer (an
"Excess Cash Offer") to the Holders to purchase the maximum amount of
Notes which could be acquired by application of the Accumulated Amount
as defined below (the "Excess Cash Offer Amount"), at a purchase price
(the "Excess Cash Offer Price") equal to 100% of the Accreted Value of
the Senior Secured Discount Notes and the principal amount of the
Senior Secured Notes plus accrued and unpaid interest, if any, to and
including, the date the Notes tendered are purchased and paid for in
accordance with this Indenture, which date shall be no later than 25
Business Days after the first date on which the Excess Cash Offer is
required to be made (the "Excess Cash Purchase Date"). The Excess Cash
Offer Amount required to be paid hereunder shall be reduced by the
amount needed to pay the cash interest on the Notes through maturity
(less any interest payable to the Company on the TARC Intercompany
Loan, and the TransTexas Intercompany Loan and any other intercompany
loan payable to the Company) after giving effect to the Notes
repurchased pursuant to the Excess Cash Offer (the "Interest Reserve
Amount"). The Company shall send notice of an Excess Cash Offer at
least 20 Business Days prior to the close of business on the third
Business Day prior to the Excess Cash Purchase Date (the "Final Put
Date"), by first-class mail, to each Holder at his address set forth
upon the registry of the Company, with a copy to the Trustee. The
notice to the Holders will contain all information, instructions, and
materials required by applicable law or otherwise material to such
Holders' decision to tender Notes pursuant to the Excess Cash Offer.
An amount equal to the aggregate of all Excess Cash received by the
Company, less the aggregate amount thereof theretofore applied to
purchase Notes pursuant hereto is referred to as the "Accumulated
Amount." "Open Market Purchase" means any repurchase of Notes with any
prepayment of the TransTexas Intercompany Loan which repurchases
consist of Senior Secured Notes at a repurchase price (excluding
interest) no greater than par, or Senior Secured Discount Notes at a
repurchase price (excluding interest, if any) no greater than the
accreted value thereof; provided, however, that Senior Secured
Discount Notes may not be repurchased unless cash or Cash Equivalents
in an amount needed to pay the cash
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interest on the Notes through June 15, 1999 is first set aside and
reserved solely for such interest payments. For purposes hereof,
amounts applied to purchase Notes pursuant to an Open Market Purchase
shall be deemed to be the earliest received prepayments of the
TransTexas Intercompany Loan which have not theretofore been applied
to purchase Notes pursuant to an Open Market Purchase. Prior to making
any Excess Cash Offer, the Company shall invest the Accumulated Amount
only in cash and Cash Equivalents. The Company may, at its option,
elect to make an Excess Cash Offer in the manner specified herein
prior to the time that the Accumulated Amount exceeds $5,000,000.
Section 1.13. Section 4.24 of the Original Indenture. Section 4.24 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 4.24 Additional Interest Excess Cash Offer. Upon the
occurrence of a TransTexas Interest Increase, the Company shall be
obligated to make an offer to purchase the Notes upon the terms and
subject to the conditions described below. Not later than 20 Business
Days after any date on which the Additional Interest Accumulated
Amount (as defined below) exceeds $10,000,000, the Company shall make
an irrevocable, unconditional offer (an "Additional Interest Excess
Cash Offer") to the Holders to purchase the maximum amount of Notes
which could be acquired by application of the Additional Interest
Accumulated Amount (as defined below) (the "Additional Interest Excess
Cash Offer Amount"), at a purchase price (the "Additional Interest
Excess Cash Offer Price") equal to 101% of the Accreted Value of the
Senior Secured Discount Notes and the principal amount of the Senior
Secured Notes, in each case, plus accrued and unpaid interest, if any,
to and including the date the Notes tendered are purchased and paid
for in accordance with the Indenture, which date shall be no later
than 25 Business Days after the first date on which the Additional
Interest Excess Cash Offer is required to be made (the "Additional
Interest Excess Cash Purchase Date"). The Company shall send notice of
an Additional Interest Excess Cash Offer at least 20 Business Days
prior to the close of business on the third Business Day prior to the
Additional Interest Excess Cash Purchase Date (the "Additional
Interest Final Put Date"), by first-class mail, to each Holder at his
address set forth upon the registry of the Company, with a copy to the
Trustee. The notice to the Holders will contain all information,
instructions, and materials required by applicable law or otherwise
material to such Holders' decision to tender Notes pursuant to the
Additional Interest Excess Cash Offer. An amount equal to the
aggregate of all Additional Interest Excess Cash received by the
Company is referred to as the "Additional Interest Accumulated
Amount." Prior to making any Additional Interest Excess Cash Offer,
the Company shall invest the Additional Interest Accumulated Amount
only in cash and Cash Equivalents. The Company may, at its option,
elect to make an Additional Interest Excess Cash Offer in the manner
specified herein prior to the time that the Additional Interest
Accumulated Amount exceeds $10,000,000.
To the extent applicable and if required by law, the Company
shall comply with Section 14 of the Exchange Act and the provisions of
Regulation l4E and any other tender offer rules under the Exchange Act
and other securities laws, rules, and regulations which may then be
applicable to any Additional Interest Excess Cash Offer by the Company
to purchase the Notes. The Company shall give the Trustee prompt
notice if the Additional Interest Accumulated Amount exceeds
$10,000,000.
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On or before an Additional Interest Excess Cash Purchase Date,
the Company shall (a) accept for payment Notes or portions thereof
properly tendered pursuant to the Additional Interest Excess Cash
Offer prior to the close of business on the Additional Interest Final
Put Date (on a pro rata basis between the issues (to the maximum
extent possible) based on the Value of the Notes actually tendered if
Notes with a Value in excess of the Value of Notes to be acquired are
tendered and not withdrawn), (b) deposit with the Paying Agent U.S.
Legal Tender sufficient to pay the Additional Interest Excess Cash
Offer Price through the Additional Interest Excess Cash Purchase Date
of all Notes or portions thereof so accepted, and (c) deliver to the
Trustee Notes so accepted together with an Officers' Certificate
stating the Notes or portions thereof being purchased by the Company.
The Paying Agent shall promptly mail or deliver to Holders of Notes so
accepted, payment in an amount equal to the Additional Interest Excess
Cash Offer Price through the Additional Interest Excess Cash Purchase
Date for such Notes. The Trustee shall promptly cancel all Notes
accepted by the Company pursuant to the Additional Interest Excess
Cash Offer and authenticate and mail or deliver to the Holders of
Notes so accepted a new Note equal in Value to any unpurchased portion
of the Note surrendered. Any Notes not so accepted shall be promptly
mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Additional Interest Excess
Cash Offer on or as soon as practicable after the Additional Interest
Excess Cash Payment Date.
If the amount required to acquire all Notes tendered by
Holders pursuant to the Additional Interest Excess Cash Offer (the
"Additional Interest Excess Cash Acceptance Amount") shall be less
than the aggregate Additional Interest Excess Cash Offer Amount, the
excess of the Additional Interest Excess Cash Acceptance Amount shall
be (i) invested in cash or Cash Equivalents, (ii) used by the Company
to make a Note Repurchase or (iii) used by the Company to make loans
to its Subsidiaries, provided that such loans (x) are on terms no less
favorable to the Company than the economic terms described to the
Holders in the Additional Interest Excess Cash Offer, (y) are made to
the parties described in the Excess Cash Offer and (z) have a maturity
date which is not after the maturity date of the Notes. Upon
consummation of any Additional Interest Excess Cash Offer made in
accordance with the terms of the Indenture, the Additional Interest
Accumulated Amount will be reduced to zero.
Notwithstanding anything contained in the foregoing to the
contrary, the Company shall immediately deposit any cash received by
it that the Company has allocated to the Additional Interest Reserve
Amount into a segregated cash collateral account in which the Trustee
has a perfected first priority security interest pending such uses.
Section 1.14. Sections 4.25 and 4.26 of the Original Indenture. New
Sections 4.25 and 4.26 are hereby added to follow Section 4.24 of the Original
Indenture to read in their entirety as follows:
Section 4.25 Monthly Status Reports. The Company shall cause
TransContinental to, (A) not later than the 20th day of each month
(or, if such day is not a Business Day, then the first Business Day
following such day), commencing in December 1998 and continuing
through the Phase II Completion Date, issue a press release (and, if
applicable, file a copy thereof with the SEC pursuant to a Form 8-K
Current Report) disclosing the status of completion of the Capital
Improvement Program through the end of the
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immediately preceding month and (B) conduct a monthly telephone
conference call relating thereto with the chief executive officer of
TARC or his designee in which Holders will be entitled to participate
and provide notice of the time and place of such call at least 48
hours in advance thereof.
Section 4.26 Limitation on Issuances of Equity Securities by
TCR Holding or TransContinental. The Company shall not permit TCR
Holding, TransContinental or any Subsidiary of either of them to issue
(other than pursuant to the Transaction, including securities issued
upon conversion of or in exchange for securities issued pursuant to
the Transaction upon the terms established in connection with the
Transaction, or issuances to TransContinental or any of its
Subsidiaries) any Capital Stock or other equity securities (other than
Disqualified Capital Stock that is not convertible into or
exchangeable for Qualified Capital Stock and other equity securities
that are not accounted for as equity securities in accordance with
GAAP) unless the issuer first obtains a favorable written opinion as
to the fairness of such transaction to the issuer, from a financial
point of view, from an independent nationally recognized accounting or
investment banking firm.
Section 1.15. Section 5.1 of the Original Indenture.
(a) Section 5.1(a)(1) of the Original Indenture is hereby amended to read
in its entirety as follows:
(1) either (a) the Company, TARC or TransTexas, as the case
may be, shall be the continuing Person, or (b) the Person (if other
than the Company) formed by such consolidation or into which the
Company, TARC or TransTexas, as the case may be, is merged or to which
all or substantially all of the properties and assets of the Company,
TARC or TransTexas, as the case may be, are transferred as an entirety
or substantially as an entirety (the Company, TARC or TransTexas, as
the case may be, or such other Person being hereinafter referred to as
the "Surviving Person") shall be a corporation or partnership
organized and validly existing under the laws of the United States,
any State thereof or the District of Columbia, and shall expressly
assume, by an indenture supplemental hereto and any supplements to any
Security Documents as the Trustee in its sole discretion may require,
executed and delivered to the Trustee on or prior to the consummation
of such transaction, in form satisfactory to the Trustee, all the
obligations of the Company, TARC or TransTexas, as the case may be,
under the Notes, the TARC Intercompany Loan, the TransTexas
Intercompany Loan, the Security Documents, the Registration Rights
Agreements, and this Indenture; provided, however, that TCR Holding
shall not be required to assume TARC's obligations under the Security
Documents in connection with the transfer to TCR Holding by TARC of
the Refinery Assets as part of the Transaction, provided TCR Holding,
concurrently with such transfer, executes and delivers to the Company
the TCR Holding Pledge Agreement and assumes all of the obligations of
TARC pursuant to the TARC Intercompany Loan and the Company assigns
its rights thereunder to the Trustee;
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(b) Section 5.1 of the Original Indenture is hereby amended to add
subsection (e) to read in its entirety as follows:
(e) Notwithstanding anything contained in this Article V to
the contrary, (i) the provisions of clause (a) shall not apply to the
transfer to TCR Holding by TARC of the Refinery Assets as part of the
Transaction, (ii) the provisions of clause (a) shall not apply to the
transfer to TransContinental by TCR Holding of the Refinery Assets as
part of the Transaction and (iii) the provisions of clauses (a)(2),
(a)(3) and (a)(5) shall not apply to a merger of TARC with or into the
Company.
Section 1.16. Section 5.2 of the Original Indenture. Section 5.2 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 5.2 Successor Corporation Substituted. Upon any
consolidation or merger, or any transfer of assets in accordance with
Section 5.1 (other than the transfers of the Refinery Assets by TARC
to TCR Holding and by TCR Holding to TransContinental pursuant to the
Transaction), the Surviving Person formed by such consolidation or
into which the Company, TARC or TransTexas, as the case may be, is
merged or to which such transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the
Company, TARC or TransTexas, as the case may be, under this Indenture
with the same effect as if such Surviving Person had been named as the
Company, TARC or TransTexas, as the case may be, herein. When a
Surviving Person duly assumes all of the obligations of the Company
pursuant hereto and pursuant to the Notes, the predecessor shall be
released from such obligations. Upon the assumption by TCR Holding of
all of the obligations of TARC under the TARC Intercompany Loan, TARC
shall be released from any further obligation with respect to the TARC
Intercompany Loan.
Section 1.17. Section 6.1 of the Original Indenture.
(a) Section 6.1(b) of the Original Indenture is hereby amended to read in
its entirety as follows:
(b) default in the payment of all or any part of the principal
of (or premium, if any, applicable to), the Notes when and as the same
becomes due and payable at maturity, redemption, by acceleration, or
otherwise, including default in the payment of the Change of Control
Purchase Price in accordance with Article XI, or the Excess Cash Offer
Price in accordance with Section 4.21;
(b) Section 6.1(d) of the Original Indenture is hereby amended to read in
its entirety as follows:
(d) a default which extends beyond any stated period of grace
applicable thereto, including any extension thereof, under any
mortgage, indenture or instrument under which there is outstanding any
Debt of the Company, any of its Subsidiaries or TransContinental with
an aggregate principal amount in excess of $25,000,000 if by reason of
such default the principal of such Debt and all accrued and unpaid
interest thereon has been declared due and payable, or failure to pay
such Debt at its stated maturity, provided that a waiver by all of the
lenders of such debt of such default shall constitute a waiver
hereunder for the same period;
(c) Section 6.1(h) of the Original Indenture is hereby amended to read in
its entirety as follows:
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(h) except as caused by the consummation of the Transaction
(including, without limitation, the release of the liens on the
Refinery Assets granted pursuant to the TARC Security Documents), any
of the Security Documents shall for any reason cease to be in full
force and effect other than pursuant to the terms thereof (except
where no material adverse effect to the Holders would result), or
shall cease to give the Trustee for the ratable benefit of the Holders
the Liens, rights, powers and privileges purported to be created
thereby including but not limited to, a perfected security interest
in, and Lien on, the Collateral in accordance with the terms thereof,
except where the failure to have such Lien, rights, powers and
privileges shall not have a material adverse effect on the Holders;
(b) Section 6.1(i) of the Original Indenture is hereby amended to read in
its entirety as follows:
(i) Intentionally Omitted;
Section 1.18. Section 9.1 of the Original Indenture. Section 9.1 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 9.1 Supplemental Indentures Without Consent of
Holders. Without the consent of any Holder, the Company, when
authorized by Board Resolutions, and the Trustee, at any time and from
time to time, may enter into one or more indentures supplemental
hereto or a restatement hereof or amendments to or restatements of the
Security Documents, the Intercompany Loans and documents related
thereto, the Intercreditor Agreements, the TransTexas Disbursement
Agreement or the Disbursement Agreement (collectively, the "Other
Documents"), in form satisfactory to the Trustee, for any of the
following purposes:
(a) to cure any ambiguity, defect, or inconsistency, or to
make any other provisions with respect to matters or questions
arising under this Indenture, the Security Documents, the
Intercreditor Agreement or the Disbursement Agreement which
shall not be inconsistent with the provisions of this
Indenture, provided such action pursuant to this clause (a)
shall not adversely affect the interests of any Holder in any
respect;
(b) to add to the covenants of the Company for the benefit
of the Holders or to surrender any right or power herein
conferred upon the Company or to make any other change that
does not adversely affect the rights of any Holder, provided
that the Company has delivered to the Trustee an Opinion of
Counsel stating that such change does not adversely affect the
rights of any Holder;
(c) to provide for additional collateral for the Notes;
(d) to evidence the succession of another Person to the
Company and the assumption by any such successor of the
obligations of the Company herein and in the Notes in
accordance with Article V;
(e) to comply with the TIA; or
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(f) to restate this Indenture or any of the Other Documents
so that it reflects this Indenture or such Other Document, as
the case may be, as originally executed as amended by all
amendments and supplements hereto or thereto through the date
of such restatement and contains only the then effective
provisions of this Indenture or such Other Document, as the
case may be.
Section 1.19. Section 9.6 of the Original Indenture. Section 9.6 of the
Original Indenture is hereby amended to read in its entirety as follows:
Section 9.6 Trustee to Sign Amendments, Etc. The Trustee shall
execute any amendment, supplement, restatement or waiver authorized
pursuant to this Article IX, provided that the Trustee may, but shall
not be obligated to, execute any such amendment, supplement,
restatement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture. The Trustee at the expense of the
Company shall be entitled to receive, and shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of any
amendment, supplement, restatement or waiver authorized pursuant to
this Article IX is authorized or permitted by this Indenture.
Section 1.20. Section 12.4 of the Original Indenture. Section 12.4(a) of
the Original Indenture is hereby amended to read in its entirety as follows:
Section 12.4 Disposition of Certain Collateral Without
Requesting Release.
(a) Notwithstanding the provisions of Sections 12.5, 12.6,
12.7, 12.8 and 12.14, the Company (or with respect to the Security
Documents, the grantor of the security interest thereunder) may,
without requesting or receiving the consent of the Trustee (and any
lender, trustee or collateral agent under any of the Security
Documents):
(i) sell, assign, transfer, license or otherwise dispose
of, free from the Security Interests, any personal property
constituting Collateral that has become worn out, obsolete, or
unserviceable, upon replacing the same with machinery or
equipment constituting Collateral not necessarily of the same
character but, at the time of such sale, assignment, transfer,
license or other disposition, being of at least equal value
and utility as the property so disposed of, which property
shall without further action become Collateral subject to the
Security Interests;
(ii) (A) sell, assign, transfer, license or otherwise
dispose of, free from the Security Interests, inventory in the
ordinary course of business and consistent with past
practices, (B) collect, liquidate, sell, factor or otherwise
dispose of, free from the Security Interests, notes receivable
in the ordinary course of business and consistent with past
practices or (C) make cash payments (including repayments of
Debt permitted to be Incurred hereby) that are not otherwise
prohibited by this Indenture;
(iii) sell, assign, lease, license, transfer, abandon or
otherwise dispose of, free from the Security Interests, (a)
damaged, worn out or other obsolete property
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in the ordinary course of business or (b) other property no
longer necessary for the proper conduct of its business; and
(iv) dispose of Collateral, free from the Security
Interests, pursuant to clause (i), (ii), (iii), (iv), (vii),
(viii) or (xii) of Section 4.14(b).
Section 1.21. Section 12.5 of the Original Indenture. Section 12.5(a) of
the Original Indenture is hereby amended to read in its entirety as follows:
(a) Upon receipt of a Release Request, the Trustee shall
execute and deliver, within five Business Days from the receipt of
such Release Request, any instruments deemed by the Company (or with
respect to the Security Documents, the grantor of the security
interests thereunder) to be reasonably necessary or reasonably
appropriate to release all or a part of the Collateral from the
Security Interests, if the provisions of this Section 12.5 have been
complied with. Any such Release Request shall request the Trustee to
execute one or more specifically described release instruments (which
release instruments shall accompany such Release Request) and shall
certify (i) that no Event of Default has occurred and is continuing
(or with respect to a Release Request relating to any of the Security
Documents, that no event of default has occurred and is continuing
under the applicable Security Document) and (ii) that one of the
conditions of this Section 12.5(a) set forth below (specifying such
condition), and if such specified condition is described in clause
(i), (ii), or (iii) below, that the conditions of Section 12.4, 12.6
or 12.7, if applicable, have been, or simultaneously with or
immediately following the release will be, fulfilled:
(i) the Collateral will be disposed of in compliance with
Section 12.4;
(ii) there is a substitution of Substitute Collateral in
accordance with Section 12.6;
(iii) there is a deposit of cash in a cash collateral account
in accordance with Section 12.7;
(iv) the Collateral to be released will be used within five
business days either to make redemptions or purchases of Notes which
will be delivered to the Trustee for cancellation;
(v) the Collateral is to be released in connection with an
Asset Sale made in compliance with Section 4.14;
(vi) all of the conditions precedent to the termination of the
Security Document under which the Lien in the Collateral to be
released was created, or to the release of such Collateral from the
Lien created by such Security Document, as set forth in such Security
Document, have been satisfied;
(vii) Holders of not less than 66 2/3% in Value of the then
outstanding Notes have consented in writing to such release of
Collateral from the Security Interests;
(viii) the Collateral is to be released in connection with the
TTXD Spin-off;
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(ix) the Collateral is to be released in connection with the
repurchase by TransTexas of its common stock made pursuant to the
terms of clause (xii) of the definition of "Restricted Payments"
contained herein:
(x) the Collateral to be released relates to the lien of the
TARC Mortgage on a portion of Parcel B-1 of TARC's refinery (which
parcel is more particularly described in Exhibit "A" to the TARC
Mortgage) for dedication to a governmental authority (such parcel
being referred to as the "Dedicated Parcel") for the purpose of
relocating Prospect Avenue from the western boundary line of such
Parcel B-1 to the eastern and northern boundary lines of such Parcel
B-1, provided that (i) the fee interest in and to the real property
currently dedicated for use as Prospect Avenue is conveyed to TARC
(such parcel being referred to as the "Reconveyed Parcel"), (ii) TARC
executes and delivers a supplemental mortgage evidencing that the lien
of the TARC Mortgage encumbers the Reconveyed Parcel, (iii) the
Company executes and delivers a supplemental collateral assignment
with respect to such supplemental mortgage and (iv) the Company
delivers to the Trustee a certificate of the Construction Supervisor
certifying that the loss of the use of the Dedicated Parcel does not
have a material adverse affect on the use, operation or maintenance of
TARC's refinery or the Capital Improvement Program;
(xi) the Collateral to be released secures debt or other
obligations that constitute First Lien Debt and the Company (or with
respect to releases under the Security Documents, the grantor of the
security interest thereunder) has satisfied all the requirements for
obtaining subordination of the Security Interests therein pursuant to
Section 12.2 and such Collateral is (or will be, upon obtaining such
release) encumbered by a Lien permitted pursuant to the terms of
clauses (d), (k), (s) or (t) of the definition of Permitted TARC Lien
or clauses (f), (l) or (o) of the definition of Permitted TransTexas
Lien;
(xii) the Collateral to be released consists of deposit
accounts of the Company, the TARC Intercompany Bridge Loan and the
rights of the Company under the Loan Agreement relating to the TARC
Intercompany Bridge Loan and the Release Request delivered to the
Trustee with respect to such release states that concurrently with or
immediately following the effectiveness of such release the Company
will issue Bridge Loan Notes;
(xiii) the Collateral to be released consists of the TARC
Collateral and Capital Stock of TCR Holding (other than the
Participating Preferred Stock of TCR Holding issued to TARC pursuant
to the Transaction) and TransContinental and the Release Request
delivered to the Trustee with respect to such release states that
immediately following the effectiveness of such release TARC will
issue Debt with a principal amount of at least $150 million and sell
it to the Purchasers. Concurrently with the effectiveness of such
release, the Security and Pledge Agreement dated as of June 13, 1997
by TARC in favor of the Company, as amended, shall terminate and shall
cease to be of any further force or effect; and
(xiv) the Collateral to be released consists of the
Participating Preferred Stock of TCR Holding issued to TARC pursuant
to the Transaction, the Release Request delivered to the Trustee with
respect to such release states that TCR Holding has exercised its
option
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to effect the TCR Holding Participating Preferred Stock Redemption and
is accompanied by a copy of the notice of redemption received from TCR
Holding with respect thereto and there is pledged to the Trustee
concurrently with such release the securities of TCR Holding received
by TARC pursuant to the TCR Holding Participating Preferred Stock
Redemption.
Section 1.22. Section 13.15 of the Original Indenture. A new Section 13.15
is hereby added to the Original Indenture to follow Section 13.14, to read in
its entirety as follows:
Section 13.15. Termination of Covenants and Other Provisions
Relating to TARC and TCR Holding. Upon payment in full of the TARC
Intercompany Loan, the provisions contained in Articles IV, V, VI and
XI of this Indenture, to the extent they relate to any of the TARC
Entities, any of the TCR Holding Entities or TransContinental or the
Capital Improvement Program, shall cease to be of any further force or
effect and neither the Company nor any Guarantor shall be bound
thereby. In addition, upon a merger of TARC with or into the Company,
the provisions of Article IV, V, VI and XI of this Indenture, to the
extent they relate to TARC, shall cease to be of any further force and
effect and, thereafter, neither the Company nor any Guarantor shall be
bound thereby. In addition, the TCR Holding Pledge Agreement shall
cease to be of any further force or effect upon payment in full of the
TARC Intercompany Loan.
ARTICLE II
GENERAL PROVISIONS
Section 2.01. Effectiveness of Amendments. This Supplemental Indenture is
effective as of the date first above written. However, the provisions of the
Original Indenture amended or eliminated as provided in this Supplemental
Indenture (the "Amended Provisions") shall remain operative in the form in which
they exist in the Original Indenture until the Transaction Closing Date,
whereupon the Amended Provisions will be amended or eliminated as provided
herein, effective immediately prior to the Transaction Closing Date.
Section 2.02. Ratification of Indenture. The Original Indenture is in all
respects acknowledged, ratified and confirmed, and shall continue in full force
and effect in accordance with the terms thereof and as supplemented by this
Supplemental Indenture. The Original Indenture and this Supplemental Indenture,
shall be read, taken and construed as one and the same instrument.
Section 2.03. Certificate and Opinion as to Conditions Precedent.
Simultaneously with and as a condition to the execution of this Supplemental
Indenture, the Company 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.
Section 2.04. Effect of Headings. The Article and Section headings in this
Supplemental Indenture are for convenience only and shall not affect the
construction of this Supplemental Indenture.
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Section 2.05. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, AS APPLIED
TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
Section 2.06. Counterparts. This Supplemental Indenture may be executed in
any number if counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute the same
instrument.
IN WITNESS WHEREOF, the parties to this Supplemental Indenture have caused
the Supplemental Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attached, on and effective as of day and year
first above written.
TRANSAMERICAN ENERGY CORPORATION
Attest: By:
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Xxx Xxxxx, Xx Xxxxxxx,
Assistant Secretary Vice President, Chief Financial Officer
and Secretary
FIRSTAR BANK OF MINNESOTA, N.A.,
as Trustee
By:
-----------------------------------------
Xxxxx X. Xxxxxx, III,
Vice President
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