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EXHIBIT 4.31
[EXECUTION COPY]
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NOTE PURCHASE AGREEMENT
between
TRANSAMERICAN REFINING CORPORATION
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ CORPORATE BOND FUND, INC. - HIGH INCOME PORTFOLIO
$36,000,000 Senior Secured Notes Due 2002
Dated as of December 10, 1997
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Table of Contents
Page
ARTICLE I
DEFINITIONS
................................................................................................................ 1
Section 1.01. Defined Terms........................................................................... 1
Section 1.02. Certain Terms........................................................................... 12
Section 1.03. Rules of Construction................................................................... 12
ARTICLE II
SALE AND PURCHASE OF NOTES
................................................................................................................ 12
Section 2.01. Authorization of Notes.................................................................. 12
Section 2.02. Sale and Purchase of Notes.............................................................. 13
Section 2.03. Closing; Funding........................................................................ 13
Section 2.04. Payments................................................................................ 13
Section 2.05. Fees.................................................................................... 13
Section 2.06. Interest Rate Limitation................................................................ 14
ARTICLE III
PAYMENT AND REDEMPTION OF NOTES
................................................................................................................ 14
Section 3.01. Maturity Date........................................................................... 14
Section 3.02. Redemption.............................................................................. 14
....................................................................................................... 17
Section 3.03. Repurchase of Notes Upon Change of Control.............................................. 17
Section 3.04. Pro Rata Redemptions/Repurchases........................................................ 18
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
................................................................................................................ 19
Section 4.01. Representations and Warranties.......................................................... 19
Section 4.02. Certificates............................................................................ 22
ARTICLE V
CONDITIONS TO CLOSING
................................................................................................................ 22
Section 5.01. Conditions Precedent.................................................................... 22
ARTICLE VI
INFORMATION
................................................................................................................ 25
Section 6.01. Information............................................................................. 25
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ARTICLE VII
INTENTIONALLY OMITTED.................................................................................. 25
ARTICLE VIII
COVENANTS.............................................................................................. 26
Section 8.01. Use of Proceeds......................................................................... 26
Section 8.02. Filing of Security Documents............................................................ 26
Section 8.03. Further Assurances...................................................................... 26
Section 8.04. Incorporation by Reference.............................................................. 26
ARTICLE IX
EVENTS OF DEFAULT...................................................................................... 27
Section 9.01. Events of Default; Remedies............................................................. 27
Section 9.02. Remedies................................................................................ 29
Section 9.03. Remedies Cumulative..................................................................... 30
Section 9.04. Remedies Not Waived..................................................................... 30
ARTICLE X
THE NOTES.............................................................................................. 30
Section 10.01. Registration, Exchange, and Transfer of Notes.......................................... 30
Section 10.02. Lost, Stolen, Damaged and Destroyed Notes.............................................. 30
ARTICLE XI
MISCELLANEOUS.......................................................................................... 31
Section 11.01. Amendment and Waiver................................................................... 31
Section 11.02. Expenses and Taxes..................................................................... 31
Section 11.03. Survival of Representations and Warranties............................................. 32
Section 11.04. Successors and Assigns................................................................. 33
Section 11.05. Notices................................................................................ 33
Section 11.06. Indemnification........................................................................ 34
Section 11.07. Public Announcements................................................................... 35
Section 11.08. No Fiduciary Relationship.............................................................. 35
Section 11.09. Integration and Severability........................................................... 35
Section 11.10. Counterparts........................................................................... 35
Section 11.11. Governing Law.......................................................................... 36
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SECTION 11.12. SUBMISSION TO JURISDICTION; WAIVER OF SERVICE
AND VENUE..................................................................................... 36
SECTION 11.13. MUTUAL WAIVER OF RIGHT TO TRIAL BY JURY................................................ 37
SECTION 11.14. Release of Collateral; Subordination................................................... 37
Appendix A - Principal Amounts and Payment Instructions
Exhibit A - Form of Senior Secured Note
Exhibit B - Form of Security Agreement
Exhibit C - Form of Cash Collateral and Disbursement Agreement
Exhibit D - Form of Mortgage
Exhibit E - Form of Environmental Indemnity Agreement
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NOTE PURCHASE AGREEMENT
NOTE PURCHASE AGREEMENT, dated as of December 10, 1997 (the
"Agreement"), by and between TRANSAMERICAN REFINING CORPORATION, a Texas
corporation (together with its successors and assigns, the "Company") and
▇▇▇▇▇▇▇ ▇▇▇▇▇ Corporate Bond Fund, Inc. - High Income Portfolio (together with
its successors and assigns, the "Purchaser").
W I T N E S S E T H:
WHEREAS, prior to the date hereof, and pursuant to an Asset Purchase
Agreement, dated as of September 19, 1997, between GATX Terminals Corporation, a
Delaware corporation (together with its successors and assigns, "GATX"), and the
Company (as it may be from time to time amended, modified or supplemented, the
"Asset Purchase Agreement"), the Company has purchased from GATX the Acquired
Assets (as such term is defined in the Asset Purchase Agreement, and herein
referred to as the "Acquired Assets");
WHEREAS, the Company desires to issue and sell to Purchaser its Senior
Secured Notes Due 2002 in an aggregate principal amount of Thirty Six Million
Dollars ($36,000,000); and
WHEREAS, subject to the terms and conditions hereinafter set forth,
Purchaser is willing to purchase such Senior Secured Notes.
NOW, THEREFORE, in consideration of the foregoing and for such other
good and valuable consideration, the sufficiency and receipt of which each party
hereto hereby acknowledges, the Company and Purchaser agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms. For the purposes of this Agreement, the
following terms shall have the following respective meanings:
"Acquired Assets" shall have the meaning set forth in the
recitals hereto.
"Affiliate" means, with respect to any specified Person, (a)
any other Person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified Person or (b) any
officer, director or controlling shareholder of such other Person. For purposes
of this definition, the term "control" means (i) the power to direct the
management and policies of a Person, directly or through one or more
intermediaries, whether through the ownership
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of voting securities, by contract, or otherwise, or (ii) without limiting the
foregoing, the beneficial ownership of 5% 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 (whether or not presently exercisable).
"Asset Purchase Agreement" shall have the meaning set forth in
the recitals hereto.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors, as amended from time to
time.
"Board of Directors" means, with respect to any Person, the
Board of Directors of such Person or any committee of the Board of Directors of
such Person authorized, with respect to any particular matter, to exercise the
power of the Board of Directors of such Person.
"Board Resolution" means, with respect to any Person, a duly
adopted resolution of the Board of Directors of such Person.
"Business Day" means a day that is not a Saturday or Sunday or
a day on which banks are required or otherwise authorized to close in either New
York, New York or Houston, Texas.
"Capital Stock" means, with respect to any Person, any capital
stock of such Person and shares, interests, participation or other ownership
interests (however designated), of such Person and any rights (other than debt
securities convertible into corporate stock), warrants or options to purchase
any of the foregoing, including without limitation each class of common stock
and preferred stock of such Person if such Person is a corporation and each
general and limited partnership interest of such Person if such Person is a
partnership provided, however, that with respect to the Company, "Capital Stock"
shall not include warrants to purchase common stock of the Company either (i)
currently outstanding or (ii) issued in connection with the issuance of
Subordinated Debt of the Company.
"Cash Equivalents" means (a) United States dollars, (b)
securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality thereof having maturities of
not more than one year from the date of acquisition, (c) certificates of deposit
with maturities of one year or less from the date of acquisition, bankers'
acceptances with maturities not exceeding one year, and overnight bank deposits,
in each case, with any Eligible Institution, (d) repurchase obligations with a
term of not more than seven days for underlying securities of the types
described in clauses (b) and (c) entered into with any Eligible Institution, (e)
commercial paper rated "P-1," "A-1" or the equivalent thereof by Moody's, or S&P
respectively, and in each case maturing within one year after the date of
acquisition, (f) shares of money market funds, including those of the TEC
Indenture Trustee, that invest solely in United States dollars and
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securities of the types described in clauses (a) through (e), (g) demand and
time deposits and certificates of deposit with any commercial bank organized in
the United States not meeting the qualifications specified in clause (c) above
or with an Eligible Institution, provided that such deposits and certificates
support bonds, letters of credit and other similar types of obligations incurred
in the ordinary course of business, (h) deposits, including deposits denominated
in foreign currency, with any Eligible Institution; provided that all such
deposits do not exceed $10,000,000 in the aggregate at any one time, and (i)
demand or fully insured time deposits used in the ordinary course of business
with commercial banks insured by the Federal Deposit Insurance Corporation.
"Change of Control" means (i) the liquidation or dissolution
of, or the adoption of a plan of liquidation by, the Company, or (ii) any
transaction, event or circumstance pursuant to which any "person" or "group" (as
such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable), other than ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (or his heirs, his
estate or any trust in which he or his immediate family members have, directly
or indirectly, a beneficial interest in excess of 50%) and his Subsidiaries or
the TEC Indenture Trustee, is or becomes the "beneficial owner" (as that term is
used in Rules 13d-3 and 13d-5 under the Exchange Act, whether or not
applicable), directly or indirectly, of more than 50% of the total voting power
of the Company's then outstanding Voting Stock; unless, at the time of the
occurrence of an event specified in clause (ii), the Notes have an Investment
Grade Rating; provided, however, that if at any time within 120 days after such
occurrence, the Notes cease having an Investment Grade Rating, such event shall
be a "Change of Control."
"Change of Control Offer" shall have the meaning specified in
Section 3.03.
"Change of Control Payment Date" shall have the meaning
specified in Section 3.03.
"Change of Control Purchase Price" shall have the meaning
specified in Section 3.03.
"Closing Date" means the date of this Agreement.
"Collateral" means all of the Property of the Company subject
to the Lien of the Holders pursuant to the Security Documents.
"Collateral Account" shall have the meaning provided in the
Disbursement Agreement.
"Common Stock" means the common stock, par value $.01 per
share, of the Company, now or hereafter issued.
"Company" has the meaning set forth in the preamble hereto.
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"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Debt" shall have the meaning ascribed thereto in the TEC
Indenture, and any defined term used therein not otherwise defined herein shall
have the meaning ascribed thereto in the TEC Indenture.
"Default" means an event or condition, the occurrence of which
is, or with the lapse of time would be, or giving of notice, or both, would be
an Event of Default.
"Disbursement Agent" means State Street Bank and Trust
Company, Inc., in its capacity as Disbursement Agent under the Disbursement
Agreement, and any successor thereto.
"Disbursement Agreement" means the Cash Collateral and
Disbursement Agreement, among the Company, Purchaser and the Disbursement Agent
substantially in the form of Exhibit C, as amended from time to time in
accordance with the terms hereof.
"Docks" means the three docks designated as "Ship Docks #s 1,
2 and 3" (formerly designated as "Ship Docks #2, 3 and 4") and all appurtenances
thereto, situated on and in the Mississippi River adjacent to the portion of the
Real Estate fronting on the Mississippi River, all as shown on the Survey (as
"Ship Docks #s 2, 3 and 4").
"Dollars" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Eligible Institution" means a domestic commercial banking
institution that has combined capital and surplus of not less than $500,000,000,
whose debt is rated "A" (or higher) according to S&P or Moody's at the time as
of which any investment or rollover therein is made.
"Environmental Indemnity Agreement" means the Environmental
Indemnity Agreement between the Parent and Purchaser, substantially in the form
attached as Exhibit E, as amended from time to time in accordance with the terms
thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"Event of Default" shall have the meaning specified in Section
9.01.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
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"Final Change of Control Put Date" shall have the meaning
specified in Section 3.03.
"GAAP" means generally accepted accounting principles as in
effect in the United States on the Closing Date applied on a basis consistent
with that used in the preparation of the audited financial statements of the
Company included in the offering circular related to the TEC Indenture.
"GATX" shall have the meaning set forth in the recitals
hereto.
"Government Securities" means direct obligations of, or other
obligations guaranteed by, the United States of America for the payment of which
guarantee or obligations the full faith and credit of the United States is
pledged.
"Holder" means the Person in whose name a Note is registered
on the Company's books.
"Investment Grade Rating" means, with respect to any Person or
issue of debt securities or preferred stock, a rating in one of the four highest
letter rating categories (without regard to "+" or "-" other modifiers) by any
rating agency or if any such rating agency has ceased using letter rating
categories or if the four highest of such letter rating categories are not
considered to represent "investment grade" ratings, then the comparable
"investment grade" ratings (as designated by any such rating agency).
"Lien" means any mortgage, lien, pledge, charge, security
interest, or other encumbrance of any kind, whether or not filed, recorded or
otherwise perfected under applicable law (including any conditional sale or
other title retention agreement and any lease deemed to constitute a security
interest and any option or other agreement to give any security interest).
"Marketable Securities" means (a) Government Securities, (b)
any certificate of deposit maturing not more than 270 days after the date of
acquisition issued by, or time deposit of, an Eligible Institution, (c)
commercial paper maturing not more than 270 days after the date of acquisition
issued by a corporation (other than an Affiliate of the Company) with a rating,
at the time as of which any investment therein is made, of "A-l" (or higher)
according to S&P or "P-1" (or higher) according to Moody's, issued or offered by
an Eligible Institution, (d) any bankers' acceptances or money market deposit
accounts issued or offered by an Eligible Institution, and (e) any fund
investing exclusively in investments of the types described in clauses (a)
through (d) above.
"Material Adverse Effect" means, with respect to any
occurrence, failure, act or omission of any nature, individually or in the
aggregate, a change or an effect which would
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reasonably be expected to impair materially (i) the ability of the Company and
its Subsidiaries, taken as a whole, to conduct its business substantially as now
conducted; (ii) the business, operations, prospects or financial condition of
the Company and its Subsidiaries taken as a whole; (iii) the ability of the
Company to perform any of its obligations hereunder, under the Notes or under
any Security Document to which it is a party; (iv) the validity or
enforceability of this Agreement, the Notes or any Security Document; (v) the
priority or enforceability of any security interest created hereby or by any
Security Document and intended to be perfected hereunder or thereunder; or (vi)
the ability of the Holders to exercise any of their rights or remedies
hereunder, under the Notes or under any Security Document.
"Maturity Date", when used with respect to the Notes, means
the date on which the principal of such Notes becomes due and payable as therein
or herein provided, whether at the Stated Maturity or Change of Control Payment
Date or by declaration of acceleration, call for redemption or otherwise.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage(s)" has the meaning specified in Section 5.01(a)(v).
"NASD" means the National Association of Securities Dealers,
Inc.
"Note(s)" means the Company's Senior Secured Notes Due 2002,
substantially in the form of Exhibit A, and any Note delivered in substitution
or exchange for any thereof, as supplemented from time to time in accordance
with the terms hereof.
"Officer" means, with respect to the Company, the Chairman of
the Board, the Chief Executive Officer, the President, any Vice President, the
Chief Financial Officer, the Treasurer, the Controller or the Secretary of the
Company or, with respect to any certificates required at Closing, any Assistant
Secretary of the Company.
"Parent" means TransAmerican Natural Gas Corporation, a Texas
corporation.
"Permits" means authorizations, approvals, orders, licenses,
certificates and permits of and from any regulatory or governmental officials,
bodies and tribunals.
"Permitted Liens" or "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, repairment,
mineral interest owners,
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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 god 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 Authority Financing; (e) Liens
arising by operation of law in connection with judgements, 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 (as each such term is defined in
the TEC Indenture); (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 Closing 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, (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
(iv) such Lien does not extend the 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
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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 (as such terms are
defined in the TEC Indenture); (p) Liens on cash deposits to secure
reimbursement obligations with respect to letters of credit after the Delayed
Coking Unit (as such terms are defined in the TEC Indenture) 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; (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; (t) Liens imposed in connection with the Port
Authority Financing; provided, that such Liens, if not Permitted Liens, do not
extend to property other than 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) 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 TEC or its assignee under
the Security Documents (as defined in the TEC Indenture) and (x) Liens on tank
storage facilities in the vicinity of the TARC refinery acquired after the date
hereof.
"Person" means any corporation, individual, joint stock
company, joint venture, partnership, unincorporated association, governmental
regulatory entity, country, state or political subdivision thereof, trust,
municipality or other entity.
"Port Authority Financing" means a financing transaction
involving the following elements: (a) the transfer of TARC's interest in all or
some of the following assets (together with the granting, at TARC's discretion,
of any easements or servitudes reasonably necessary to the ownership and
operation of such assets by the transferee) which are constructed or under
construction in or near TARC'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") to the Port of South Louisiana Commission or its affiliate (the
"Tax-Exempt Issuer") and a leaseback of the Port Facility Assets to TARC or one
of its Subsidiaries; (b) the issuance of tax-exempt bonds by the Tax-Exempt
Issuer; and (c) the loan proceeds from such bonds to TARC or one of its
Subsidiaries for the purpose of financing the completion of the Port Facility
Assets.
"Property" means any right or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible.
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"Public Equity Offering" means a public offering by the
Company of Capital Stock (or debt securities convertible into Capital Stock of
the Company) of the Company underwritten by a nationally recognized member of
the National Association of Securities Dealers pursuant to an effective
registration statement filed with the Securities and Exchange Commission
pursuant to the Securities Act.
"Purchaser" has the meaning specified in the preamble hereof.
"Real Estate" means the property in Norco, St. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
Louisiana, purchased by the Company from GATX pursuant to the Asset Purchase
Agreement consisting of the Terminal Acreage and the Wetlands Acreage.
"Record Date" means a Record Date specified in the Notes
whether or not such Record Date is a Business Day.
"Redemption Date" means, when used with respect to any Note to
be redeemed, the date fixed for such redemption pursuant to this Agreement.
"Redemption Price" when used with respect to any Note to be
redeemed, means the redemption price for such redemption pursuant to this
Agreement, which shall include, without duplication, in each case, accrued and
unpaid interest to the Redemption Date.
"S&P" means Standard & Poor's Ratings Service, a division of
▇▇▇▇▇▇-▇▇▇▇, Inc., and its successors.
"SEC" means the Securities and Exchange Commission.
"SEC Documents" means all reports, schedules, forms,
statements and other documents filed by the Company and/or by TEC with the SEC
since January 1, 1996.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Security Agreement" means the Security Agreement between the
Company and Purchaser, substantially in the form attached as Exhibit B, as
amended from time to time in accordance with the terms hereof.
"Security Documents" means (i) the Security Agreement, (ii)
the Disbursement Agreement, (iii) the Mortgages, and (iv) each other agreement
relating to the pledge of assets to secure the Notes that may be entered into
after the Closing Date pursuant to the terms of this
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Agreement.
"Solvent" means, with respect to any Person, that (i) the
aggregate present fair saleable value of such Person's assets is in excess of
the total amount of its probable liability on its existing debts as they become
absolute and matured, (ii) such Person has not incurred debts beyond its
foreseeable ability to pay such debts as they mature, and (iii) such Person has
capital adequate to conduct the business it is presently engaged in or is about
to engage in.
"Stated Maturity", when used with respect to the Notes, means
December 15, 2002.
"Subordinated Debt" shall have the meaning ascribed thereto in
the TEC Indenture and capitalized terms used therein not otherwise defined
herein shall have the meaning ascribed thereto in the TEC Indenture.
"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 of the TEC Indenture, a joint venture an investment in
which would constitute a Permitted Investment under clause (ix) of the
definition thereof in the TEC Indenture or (ii) any Unrestricted Subsidiary of
such Person.
"Survey" means the survey of the Real Estate and also
depicting the Docks and the Tanks, prepared by BFM Corporation, dated July 30,
1997, September 12, 1997, September 14, 1997, September 16, 1997 and September
17, 1997, received by the Company in accordance with the Asset Purchase
Agreement.
"TARC" means the Company.
"TARC Entities" means the Company and its Subsidiaries.
"Tanks" means approximately 84 above ground storage tanks with
a shell capacity of approximately 5.5 million barrels located on the Real
Estate.
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"TEC" means TransAmerican Energy Corporation, a Delaware
corporation.
"TEC Indenture" means the Indenture dated as of June 13, 1997
between TEC and the TEC Indenture Trustee, pursuant to which TEC's 11.5% Senior
Secured Notes due 2002 and 13% Senior Secured Discount Notes due 2002 were
issued.
"TEC Indenture Trustee" means Firstar Bank of Minnesota, N.A.,
as Trustee under the TEC Indenture, and its successors and assigns in such
capacity.
"TEC Note" means that certain promissory note dated July 31,
1997 evidencing loans from TEC to the Company.
"Terminal Acreage" means approximately 240.8 acres within the
fence line of the GATX terminal facility between the Mississippi River and ▇.▇.
▇▇▇▇▇▇▇ #▇▇ and approximately 1.149 acres subject to a 50' L.C. Railroad right
of way.
"TNGC" means TransAmerican Natural Gas Corporation, a Texas
corporation, together with its successors and assigns.
"TransTexas" means TransTexas Gas Corporation, a Delaware
corporation.
"Unrestricted Subsidiary" of any Person means any other Person
("Other Person") that would, but for this definition of "Unrestricted
Subsidiary" be a Subsidiary of such Person organized or acquired after the Issue
Date as to which all of the following conditions apply: (i) neither such Person
nor any of its other Subsidiaries provides credit support of any Debt of such
Other Person (including any undertaking, agreement or instrument evidencing such
Debt), other than Unrestricted Non-Recourse Debt (as such term is defined in the
TEC Indenture); (ii) such Other Person is not liable, directly or indirectly,
with respect to any Debt other than Unrestricted Subsidiary Debt; (iii) neither
such Person nor any of its Subsidiaries has made an Investment in such Other
Person unless such Investment was permitted by the provisions of Section 4.3 of
the TEC Indenture and (iv) the Board of Directors of such Person, as provided
below, shall have designated such Other Person to be an Unrestricted Subsidiary
on or prior to the date of organization or acquisition of such Other Person. The
Board of Directors of any Person may designate any Unrestricted Subsidiary of
such Person as a Subsidiary of such Person; provided, that, (a) if the
Unrestricted Subsidiary has any Debt outstanding or is otherwise liable for any
Debt or has a negative Net Worth, then immediately after giving pro forma effect
to such designation, such Person could incur at least $1.00 of additional Debt
pursuant to the provisions described in Section 4.11 of the TEC Indenture
(assuming, for purposes of this calculation, that each dollar of negative Net
Worth is equal to one dollar of Debt), (b) all Debt of such Unrestricted
Subsidiary shall be deemed to be incurred by a Subsidiary of the Person on the
date such Unrestricted Subsidiary becomes a Subsidiary, and (c) no Default or
Event
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of Default would occur or be continuing after giving effect to such designation.
Any subsidiary of an Unrestricted Subsidiary shall be an Unrestricted Subsidiary
for purposes of this Agreement.
"Voting Stock" means, with respect to any corporation, Capital
Stock of such corporation having generally the right to vote in the election of
directors of such corporation.
"Wetlands Acreage" means approximately 463 acres of wetlands,
the majority of which wetlands are on the north side of U.S. Highway #61.
Section 1.02. Certain Terms. All accounting terms used in this
Agreement shall be applied on a consolidated basis, unless otherwise
specifically indicated herein. Any accounting terms not specifically defined
herein shall have the meanings customarily given them in accordance with GAAP.
Terms used herein that are defined in the Uniform Commercial Code as in effect
in the State of New York, unless defined herein, shall have the respective
meanings specified in that statute.
Section 1.03. Rules of Construction. Unless the context otherwise
requires: (a) a term has the meaning assigned to it and a capitalized term not
otherwise defined herein has the meaning given to such term in the TEC Indenture
unless the context requires otherwise; (b) an accounting term not otherwise
defined has the meaning assigned to it in accordance with GAAP; (c) "or" is not
exclusive; (d) words in the singular include the plural, and words in the plural
include the singular; (e) provisions apply to successive events and
transactions; (f) "herein", "hereof" and other words of similar import refer to
this Agreement as a whole and not to any particular Article, Section or other
subdivision; and (g) references to Sections or Articles means reference to such
Section or Article in this Agreement, unless stated otherwise.
ARTICLE II
SALE AND PURCHASE OF NOTES
Section 2.01. Authorization of Notes.
(a) The Company has duly authorized the issue, sale and
delivery of the Notes in an aggregate principal amount of Thirty Six Million
Dollars ($36,000,000), to be dated the Closing Date, to bear interest from such
date on the unpaid principal amount thereof at a rate of thirteen percent (13%)
per annum, calculated on the basis of actual days elapsed in a 360 day year
assuming a 12-month year of 30-day months.
(b) The Company shall pay interest on December 15 and June 15
of each year, in arrears, commencing June 15, 1998 and on the Maturity Date, in
each case subject to Section 2.06.
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(c) If all or a portion of the principal amount of any Note,
interest payable thereon or any fees payable hereunder shall not be paid when
due whether at the stated maturity, by acceleration or otherwise, such overdue
amount shall bear interest at a rate per annum equal to the then applicable rate
on principal plus Two Percent (2%), in each case from the date of such
nonpayment until such amount is paid in full (as well as before judgment).
Section 2.02. Sale and Purchase of Notes. Subject to the applicable
terms and conditions set forth in this Agreement, on the Closing Date, the
Company shall issue and sell to Purchaser, and Purchaser shall purchase from the
Company, a Note in the principal amount of Thirty Six Million Dollars
($36,000,000) at a purchase price equal to One Hundred Percent (100%) of the
principal amount thereof.
Section 2.03. Closing; Funding.
(a) Subject to the satisfaction or waiver of the conditions to
closing set forth in Article V, the execution and delivery of this Agreement and
the Security Documents shall take place at the offices of ▇▇▇▇▇ & ▇▇▇▇ LLP, 56th
Floor, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, on December 10, 1997,
or such other time and place as the parties shall agree (herein called the
"Closing Date").
(b) Subject to and in accordance with Section 2.02, and
subject to the satisfaction or waiver of the conditions to funding set forth in
Article V, on the Closing Date the Company shall deliver to Purchaser a Note or
Notes registered in the name of Purchaser or its nominee, duly executed and
dated the Closing Date, in the aggregate principal amount of the Notes purchased
by Purchaser hereunder, in such denomination as Purchaser may specify (not to
exceed the aggregate principal amount) by timely notice to the Company, but in
no event later than one Business Day prior to the Closing Date (or, in the
absence of such notice, one Note registered in its name in such aggregate
principal amount), against Purchaser's delivery to the Company of immediately
available funds to an account specified to Purchaser by the Company not later
than the Closing Date in the amount of the aggregate purchase price of the Notes
to be sold to Purchaser on the Closing Date.
Section 2.04. Payments. All payments by the Company hereunder of the
principal amount of the Notes, interest thereon, fees, expenses and other
amounts due hereunder shall be made in Dollars by wire transfer or other
immediately available funds, without deduction, set off or counterclaim, to each
Holder in accordance with the payment instructions on Appendix A attached hereto
(or in accordance with alternate payment instructions delivered by such Holder
to the Company at least ten Business Days but no more than twenty Business Days
prior to the relevant payment date), not later than 1:00 p.m. (New York City
time) on the date on which such payment shall become due (each such payment made
after such time on such due date to be deemed to have been made on the next
succeeding Business Day). Deposit by the Company into the Disbursement
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Account of any amount required to be paid hereunder shall constitute payment of
such amount hereunder.
Section 2.05. Fees. In addition to all other fees and other amounts
payable or paid by the Company pursuant to this Agreement, the Security
Documents or otherwise, but subject to the Interest Rate Limitation, on the
Closing Date, the Company shall pay to Purchaser, as a funding fee, an aggregate
amount equal to Three Hundred Sixty Thousand Dollars ($360,000).
Section 2.06. Interest Rate Limitation. Notwithstanding any provision
of this Agreement, the Notes or the Security Documents to the contrary, it is
the parties' intent that in no event shall the aggregate amount of all interest,
fees under Section 2.05, compounded interest, and default interest actually paid
by the Company exceed the amount of interest on principal computed (as set forth
below) at the highest rate of interest permitted by law which a court of
competent jurisdiction shall deem applicable hereto. If, under any circumstances
whatsoever, in fulfilling the provisions of this Agreement, the Notes or the
Security Documents, the Company actually pays an amount of interest, chargeable
on the total aggregate principal obligations of the Company under all Notes (as
said rate is calculated over a period of time that is the longer of (i) the time
from the date of this Agreement through the Maturity Date or (ii) the entire
period of time that any principal is outstanding on any of said Notes), which
amount of interest exceeds interest calculated at the maximum lawful interest
rate on said principal chargeable over said period of time, then such excess
interest actually paid by the Company shall be applied, first, to the pro rata
payment of principal outstanding on the Notes; second, after all principal is
repaid, to the payment of the Holders' out-of-pocket costs, expenses, and
professional fees which are owed by the Company to the Holders under this
Agreement or the Security Documents; and, third, after all principal, costs,
expenses, and professional fees owed by the Company to the Holders are repaid,
the excess (if any) shall be refunded to the Company.
ARTICLE III
PAYMENT AND REDEMPTION OF NOTES
Section 3.01. Maturity Date. The unpaid principal balance of each of
the Notes shall mature and shall be paid in full on the Maturity Date, together
with all interest accrued thereon to such date and all unpaid fees, expenses and
other amounts due and owing under the provisions of this Agreement, the Notes
and the Security Documents. All payments of the Notes shall be allocated pro
rata to each Holder and applied first to the amount of any unpaid fees, second
to any accrued and unpaid interest, and third to the outstanding principal
amount of the Notes until paid in full.
Section 3.02. Redemption.
(a) The Company may at its election, with the net proceeds of
any Public Equity
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Offering, at any time on or after the date the Notes are issued and before
December 15, 2000, redeem up to 35% of the aggregate principal amount of the
Notes in cash at a redemption price of 113% of the principal amount so redeemed,
together with accrued and unpaid interest, if any on such principal amount to
the Redemption Date.
(b) The Notes may be redeemed at the election of the Company,
as a whole or from time to time in part, at any time on and after December 15,
2000, to and including December 15, 2001 at 105% of the principal amount and
from and after December 15, 2001 to Maturity at 100% of the principal amount, in
each case together with accrued but unpaid interest on the principal amount
being redeemed to the date of such redemption, and unpaid fees and other amounts
owing pursuant to the Agreement, the Notes and the Security Documents, but
without penalty.
(c) The Company may, at its election, with the proceeds of any
Port Authority Financing, redeem all of the then outstanding Notes at a
redemption price of 108% of the principal amount so redeemed, together with
accrued but unpaid interest thereon to the date of such redemption and (ii) the
Company shall, at any time prior to 20 Business Days after the consummation of
any Port Authority Financing, if the Company has not elected to redeem all of
the outstanding Notes pursuant to clause (i) above, make an offer to purchase
$4,000,000 in principal amount of the Notes at a redemption price equal to 101%
of the principal amount, together with accrued but unpaid interest thereon to
the date of such redemption; provided, however, that the Company shall be
required to make such an offer to purchase only if the Company is requesting
therewith, pursuant to Section 11.14(c), a release or subordination of the Lien
created by the Mortgage and Security Documents on Dock No. 1 (designated as Dock
No. 2 in the Survey); provided, further, that the Company may make such offer to
purchase prior to, and may make such offer to purchase contingent upon, the
consummation of any Port Authority Financing.
(d) At least 10 days but not more than 60 days before a
Redemption Date, the Company shall mail a notice of redemption by first class
mail, postage prepaid, to each Holder whose Notes are to be redeemed. The date
fixed for redemption contained in any notice of redemption and the obligation of
the Company to redeem any Notes upon such date may be subject to the
satisfaction or waiver of conditions determined by the Company in its sole
discretion. Each notice for redemption shall identify the Notes to be redeemed
and shall state the following:
(i) the Redemption Date;
(ii) the Redemption Price, including the amount of accrued
and unpaid interest to be paid upon such redemption;
(iii) that Notes called for redemption (or, with respect to
an offer to purchase pursuant to Section 3.02(c)(ii),
Notes tendered in connection with such offer
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to purchase) must be surrendered to the Company at the
address specified in such notice to collect the
Redemption Price;
(iv) that interest on Notes called for redemption (or, with
respect to an offer to purchase under Section
3.02(c)(ii), Notes tendered in connection with such
offer to purchase) ceases to accrue on and after the
Redemption Date and the only remaining right of the
Holders of such Notes is to receive payment of the
Redemption Price, including accrued and unpaid
interest, upon surrender to the Paying Agent of the
Notes called for redemption and to be redeemed (or,
with respect to an offer to purchase under Section
3.02(c)(ii), Notes tendered in connection with such
offer to purchase);
(v) if any Note is being redeemed in part, the portion of
the principal amount, equal to $1,000 or any integral
multiple thereof, of such Note that will not be
redeemed and that, after the Redemption Date, and
upon surrender of such Note, a new Note or Notes in
aggregate principal amount equal to the unredeemed
portion thereof will be issued;
(vi) if less than all the Notes are to be redeemed, the
identification of the particular Notes (or portion
thereof) to be redeemed, as well as the aggregate
principal amount of such Notes to be redeemed and the
aggregate principal amount of Notes to be outstanding
after such partial redemption;
(vii) that the notice is being sent pursuant to this
Section 3.02(d) and pursuant to the redemption
provisions of Paragraph 5 of the Notes.
(e) Once notice of redemption is mailed in accordance
with Section 3.02(d) and upon satisfaction or waiver of any conditions precedent
to the Company's obligation to effect such redemption contained in the related
notice of redemption, Notes called for redemption (or, with respect to an offer
to purchase under Section 3.02(c)(ii), Notes tendered in connection with such
offer to purchase) become due and payable on the Redemption Date and at the
Redemption Price, including accrued and unpaid interest. Upon surrender to the
Company, such Notes called for redemption (or, with respect to an offer to
purchase under Section 3.02(c)(ii), Notes tendered in connection with such offer
to purchase) shall be paid at the Redemption Price, including interest, if any,
accrued and unpaid on the Redemption Date; provided that if the Redemption Date
is after a regular Record Date and on or prior to the Interest Payment Date, the
accrued interest through the date of redemption shall be payable to the Holder
of the redeemed Notes registered on the relevant Record Date; and provided,
further, that if a Redemption Date is a Legal Holiday, payment shall be made on
the next succeeding Business Day and no interest shall accrue for the period
from such Redemption Date to such succeeding Business Day.
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(f) Upon compliance by the Company with the provisions of
this Section 3.02 and upon satisfaction or waiver of any conditions precedent to
the Company's obligation to effect such redemption contained in the related
notice of redemption, interest on the Notes called for redemption (or, with
respect to an offer to purchase under Section 3.02(c)(ii), Notes tendered in
connection with such offer to purchase) will cease to accrue. On and after the
Redemption Date, regardless of whether such Notes are presented for payment.
Notwithstanding anything herein to the contrary, if any Note surrendered for
redemption in the manner provided in the Notes shall not be so paid upon
surrender for redemption because of the failure of the Company to comply with
the preceding paragraph, interest shall continue to accrue and be paid from the
Redemption Date until such payment is made on the unpaid principal and, to the
extent lawful, on any interest not paid on such unpaid principal, in each case
at the rate and in the manner provided in Section 2.01 and the Note.
(g) Upon surrender of a Note that is to be redeemed in part,
the Company shall execute and deliver to the Holder, without service charge, a
new Note or Notes equal in principal amount to the unredeemed portion of the
Note surrendered.
Section 3.03. Repurchase of Notes Upon Change of Control.
(a) In the event that a Change of Control occurs, each
Holder of Notes shall have the right, at such Holder's option, to require the
Company to repurchase all or any part of such Holder's Notes (provided that the
principal amount of such Notes at maturity must be $1,000 or an integral
multiple thereof) on the date that is no later than 60 Business Days after the
occurrence of a Change of Control (the "Change of Control Payment Date"), at a
cash purchase price (the "Change of Control Purchase Price") equal to 101% of
the principal amount thereof, plus accrued and unpaid interest, to and including
the Change of Control Payment Date.
(b) Within ten (10) Business Days after each date upon which
the Company knows of the occurrence of a Change of Control, the Company shall so
notify each Holder, and within twenty (20) Business Days after the Company knows
of such occurrence, the Company shall make an irrevocable unconditional offer (a
"Change of Control Offer") to all Holders to purchase for cash all of the Notes
pursuant to Section 3.03(c) at the Change of Control Purchase Price.
(c) Notice of a Change of Control Offer shall be sent, at
least 20 Business Days prior to the Final Change of Control Put Date (as defined
below), by first class mail, by the Company to each Holder at its registered
address. The notice to the Holders shall contain all instructions and materials
required by applicable law and shall contain or make available to Holders other
information material to such Holders' decision to tender Notes pursuant to the
Change of Control Offer. The notice, which shall govern the terms of the offer,
shall state:
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(i) that the Change of Control Offer is being made
pursuant to this Section 3.03 and that all Notes or portions thereof
tendered will be accepted for payment;
(ii) the Change of Control Purchase Price (including
the amount of accrued and unpaid interest), the Change of Control
Payment Date and the Final Change of Control Put Date (as defined
below);
(iii) that any Note, or portion thereof, not tendered
or accepted for payment will continue to accrue interest;
(iv) that any Note, or portion thereof, accepted for
payment pursuant to the Change of Control Offer shall cease to accrue
interest after the Change of Control Payment Date;
(v) that Holders electing to have a Note or
portion thereof purchased pursuant to a Change of Control Offer will be
required to surrender the Note, with the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Note completed, to the
Company at the address specified in the notice prior to the close of
business on the third Business Day prior to the Change of Control
Payment Date (the "Final Change of Control Put Date");
(vi) that Holders will be entitled to withdraw their
election, in whole or in part, if the Company receives, prior to the
close of business on the Final Change of Control Put Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Notes the Holder is withdrawing and
a statement that such Holder is withdrawing his election to have such
principal amount of Notes purchased; and
(vii) a brief description of the events resulting in
such Change of Control.
(d) Any such Change of Control Offer shall comply with
all applicable provisions of Federal and state laws, including those regulating
tender offers, if applicable, and any provisions of this Agreement which
conflict with such laws shall be deemed to be superseded by the provisions of
such laws. On or before the Change of Control Payment Date, the Company shall
accept for payment Notes or portions thereof properly tendered pursuant to the
Change of Control Offer prior to the close of business on the Final Change of
Control Put Date. The Company shall on the Change of Control Payment Date mail
to the Holders of Notes so accepted payment in an amount equal to the Change of
Control Purchase Price (together with accrued and unpaid interest). The Company
shall promptly cancel all Notes accepted thereby pursuant to the Change of
Control Offer and delivered to it, and authenticate and mail or deliver to the
Holders of Notes so accepted a new Note
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equal in principal amount 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.
Section 3.04. Pro Rata Redemptions/Repurchases. If pursuant to this
Article III on account of any redemption or offer to repurchase, less than all
the Notes then outstanding are to be redeemed or repurchased, as the case may
be, the Notes shall be redeemed or repurchased, as the case may be, pro rata or
by lot amongst the Holders in such manner as complies with any applicable legal
requirements.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties. The Company represents
and warrants to Purchaser as follows:
(a) The Company is a corporation duly incorporated, and
validly existing and in good standing under the laws of the State of Texas, with
full corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the SEC Documents, and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature or location of its properties (owned or
leased) or the conduct of its business requires such registration or
qualification, except where the failure to be so registered or qualified would
reasonably be expected to have a Material Adverse Effect.
(b) Each of the Company and its Subsidiaries have all
necessary material Permits to own or lease its properties and to conduct its
business as described in the SEC Documents, except as otherwise described
therein, and none of the Company or its subsidiaries has received any notice or
threat of proceedings relating to the revocation or modification of any such
Permits; each of the Company and its subsidiaries has fulfilled and performed in
all material respects all of its current obligations with respect to such
Permits and no event has occurred which allows, or after notice or lapse of
time, or both, would allow revocation or termination thereof or results in any
other material impairment of the rights of the holder of any such Permit,
subject, in each case, to such qualification as may be set forth in an SEC
Document; and each of the Company and its subsidiaries is in compliance with all
applicable laws, rules, regulations, orders and consents, except where the
failure to comply would reasonably be expected to have a Material Adverse
Effect.
(c) The Company has all requisite power and authority to enter
into this Agreement, the Notes and the Security Documents, to carry out the
provisions and conditions hereof and thereof, and to issue and deliver the Notes
to Purchaser as provided herein.
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(d) The execution and delivery and performance by the Company
of this Agreement, the Notes and the Security Documents, and the performance of
its obligations thereunder, have been duly authorized by the Company and, upon
execution and delivery by the Company (assuming the due authorization, execution
and delivery thereof by the other parties thereto), each of this Agreement, the
Notes and the Security Documents will constitute a valid and binding agreement
of the Company enforceable against the Company in accordance with its terms,
subject to (A) any applicable bankruptcy, insolvency, reorganization, moratorium
and similar laws relating to or affecting creditors' rights and remedies
generally and (B) general principles of equity regardless of whether enforcement
is sought in a proceeding in equity or at law, and the Notes are entitled to the
benefits of the Agreement.
(e) The authorized Capital Stock of the Company consists of
100,000,000 shares of Common Stock, $.01 par value, of which 30,000,000 shares
are issued and outstanding as of the close of business on Closing Date, and all
of the issued and outstanding shares of Capital Stock of the Company are validly
issued, fully paid and nonassessable and are owned of record and beneficially by
TEC. The Parent owns 100% of the outstanding capital stock of TEC. As of the
Closing Date there are no securities of the Company outstanding that are
convertible into or exchangeable for any shares of Capital Stock of the Company,
nor are there outstanding any rights to subscribe for or purchase from the
Company, or any options for the purchase from the Company of, or any agreements
(contingent or otherwise) providing for the issuance by the Company of, any
shares of Capital Stock of the Company or any securities convertible into or
exchangeable for any such shares, in each case other than the outstanding
warrants to purchase common stock of the Company.
(f) The Company is not (i) an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, and is not subject to
registration under such act, (ii) a "public utility holding" company under the
Public Utility Holding Company Act of 1935 and is not subject to regulation as a
public utility holding company under such act, (iii) subject to regulation under
the Federal Power Act or (iv) subject to regulation under any other federal or
state statute, rule or regulation restricting its ability to incur indebtedness
for borrowed money.
(g) The Company is not in violation of its charter or bylaws
or similar organizational documents or of any law, ordinance, administrative or
governmental rule or regulation applicable to it, or of any franchise, license,
permit, judgment or any decree of any court or governmental agency or body
having jurisdiction over it, or in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease, bond, debenture, bank loan,
credit agreement or other agreement instrument or evidence of indebtedness to
which it is a party or by which it is or may be bound, or to which any of its
property or assets is subject, which violation or default would reasonably be
expected to have a Material Adverse Effect.
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(h) There are no legal or governmental proceedings pending or,
to the knowledge of the Company, threatened, against the Company, or to which
any of its property is subject, except as disclosed in the SEC Documents, or as
otherwise disclosed to Purchaser, that, if adversely determined, would
reasonably be expected to have a Material Adverse Effect.
(i) Since January 31, 1997, there has not been any change or
development with respect to the condition (financial or otherwise) or business,
properties, net worth, results of operations or prospects of the Company whether
or not arising in the ordinary course of business that would reasonably be
likely to have a Material Adverse Effect.
(j) Except as disclosed in any SEC Document or as otherwise
disclosed to Purchaser, there has not been any material change in the capital
stock or other equity, or material increase in the short-term debt or long-term
debt, of the Company or any development involving or which may reasonably be
expected to have a Material Adverse Effect.
(k) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation of the
transactions contemplated hereby, except such as will have been obtained at or
before Closing.
(l) Except as disclosed in any SEC Document, or as otherwise
disclosed to Purchaser, the Company nor any of its subsidiaries is involved in
any material labor dispute nor, to its knowledge, is any such dispute
threatened.
(m) The Company has filed all federal, state and local tax
returns that are or were required to be filed or has obtained extensions thereof
and has paid all taxes shown on such returns and all assessments received by it,
to the extent that the same have become due, except for such assessments which
the Company disputes in good faith and has adequately reserved for.
(n) The issuance and sale of the Notes, the execution and
delivery of this Agreement and the Security Documents and the consummation of
any other of the transactions herein or therein contemplated, and the
fulfillment of the terms hereof or thereof, will not conflict with, result in a
breach of, or constitute a default under, the terms of any material indenture or
other agreement or instrument to which the Company is a party or bound or any
law, order, statute, regulation, consent or memorandum of understanding
applicable to the Company of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Company (which
default would have a Material Adverse Effect), or the charter or bylaws of the
Company.
(o) No part of the proceeds from the sale of the Notes will be
used, directly or indirectly, for the purpose of buying or carrying any margin
stock within the meaning of Regulation G of the Board of Governors of the
Federal Reserve System of the United States (12 CFR 207), or
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for the purpose of buying or carrying on trading in any securities under such
circumstances as to involve any of the Parent, the Company or of their
Subsidiaries in a violation of Regulation X of said Board (12 CFR 224) or to
involve any broker or dealer in a violation of Regulation T of said Board (12
CFR 220). None of the Parent, the Company, any of their Subsidiaries or any
agent acting on behalf of the Parent, the Company or any of their Subsidiaries
has taken or will take any action which might cause this Agreement or the Notes
to violate Regulation G, Regulation X, Regulation T or any other regulation of
the Board of Governors of the Federal Reserve System or to violate the Exchange
Act, in each case as in effect now or as the same may hereafter be in effect. As
used in this Section, the term "purpose of buying or carrying" has the meaning
assigned thereto in the aforesaid Regulation G.
(p) As supplemented or modified as set forth on Schedule
4.01(p) hereto the representations and warranties of the Company set forth in
Section 4.18 of the Mortgage are true and correct in all respects.
(q) Each of Parent and the Company is, and immediately after
giving effect to the sale of the Notes, the Acquisition and the other
transactions and agreements contemplated by this Agreement, will be, Solvent.
(r) At the Closing Date, the chief executive office of the
Company is at the address set forth on the signature page hereof. At least 30
days prior to the relocation of such chief executive office, the Company shall
provide written notice to the Holders setting forth the new address of such
chief executive office.
(s) On and after the Closing Date, each of the Security
Documents creates, as security for the Notes, a valid and enforceable perfected
security interest in and Lien on all of the Collateral subject thereto, superior
to and prior to the rights of all third Persons and subject to no other Liens
other than Permitted Liens. No filings or recordings are required in order to
perfect the security interests created under any Security Document which shall
not have been made, or for which satisfactory arrangements have not been made,
upon or prior to the execution and delivery thereof.
(t) Assuming the accuracy of Purchaser's representations
contained in Section 11.04(b), the offer and sale of the Notes will be exempt
from the registration requirements of the Securities Act.
Section 4.02. Certificates. Any certificate signed by any officer of
the Company and delivered to the Holders or to counsel for the Holders pursuant
to the terms of this Agreement shall be deemed a representation and warranty by
the Company to each Holder as to the matters covered thereby.
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ARTICLE V
CONDITIONS TO CLOSING
Section 5.01. Conditions Precedent. Purchaser's obligation to execute
and deliver this Agreement and the Security Documents described below and to
purchase the Notes on the Closing Date shall be subject to the satisfaction, on
or before the Closing Date, of the following conditions:
(a) Transaction Documents. Purchaser shall have received,
except for the Note to be issued thereto, a counterpart of each of the
following, each of which shall be satisfactory to Purchaser in form and
substance in all respects:
(i) this Agreement, duly executed and delivered by
the Company;
(ii) each Note to be purchased by Purchaser, duly
executed by the Company;
(iii) the Security Agreement, duly executed by the
Company;
(iv) duly executed financing statements in proper
form for filing under the Uniform Commercial Code in all such
jurisdictions as Purchaser may deem necessary or desirable in order to
perfect and protect the Liens created by the Security Agreement
covering the Collateral described in the Security Agreement;
(v) one or more mortgages in the form of Exhibit D
attached hereto (as amended from time to time in accordance with their
terms, the "Mortgages"), duly executed by the Company and dated the
Closing Date, all in proper form for filing in the appropriate offices
within the State of Louisiana as Purchaser may deem necessary or
desirable in order to perfect and protect the Liens created by the
Mortgages, together with duly executed financing statements in proper
form for filing under the Uniform Commercial Code as in effect in the
State of Louisiana;
(vi) such consents, approvals and authorizations of,
and declarations, registrations and filings with, any governmental
entities, and such consents, waivers, amendments, estoppel letters,
subordination and nondisturbance agreements, and other agreements and
confirmations of bailees, lessors of real and personal Property owned
or used by the Company and other nongovernmental third parties, as
Purchaser may deem necessary or desirable in connection with the use,
occupancy or operation of the real Properties leased by the Company or
otherwise in order to protect the rights and interests of Purchaser in
the Collateral;
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(vii) the Disbursement Agreement, duly executed by
the Company and the Disbursement Agent; and
(viii) the Environmental Indemnity Agreement, duly
executed and delivered by Parent.
(b) Corporate Documents. All corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be satisfactory in
form and substance to Purchaser, and Purchaser shall have received all such
counterpart originals or certified or other copies of such documents as it may
request, including:
(i) certificates dated as of a recent date as to
the good standing and payment of franchise and similar taxes of the
Parent and the Company in each jurisdiction where any of such Persons
is incorporated or formed or is authorized to do business as a foreign
corporation (except when failure to maintain such authorization to do
business would not result in a Material Adverse Effect);
(ii) certified copies of the certificate or articles
of incorporation of the Parent and the Company, with all amendments
thereto;
(iii) certified copies of the by-laws of the Parent
and the Company, with all amendments thereto;
(iv) certified copies of Board Resolutions of the
Parent and the Company authorizing the execution, delivery and
performance of this Agreement, the Notes, the Environmental Indemnity
Agreement and the Security Documents to which Parent and/or the Company
is a party; and
(v) certificates as to the incumbency and
signatures of each of the officers of Parent and the Company who shall
execute this Agreement or any Note or Security Document on behalf of
such respective party.
(c) TEC Indenture. The Company shall have delivered to
Purchaser a certificate of an Officer thereof certifying that (i) attached
thereto is a complete, correct and accurate copy of the TEC Indenture, together
with all attachments, exhibits, annexes and schedules thereto; (ii) the TEC
Indenture in the form of such copy is in full force and effect as of the Closing
Date and no Default or Event of Default thereunder shall have occurred and then
be continuing; and (iii) there are no outstanding waivers, amendments,
modifications or supplements to the TEC Indenture that are not attached to, or
otherwise described in, such certificate.
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(d) Opinion of Counsel. Purchaser shall have received from
each of (i) Gardere & ▇▇▇▇▇, L.L.P., and (ii) Campbell, McCranie, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ & Hardy, favorable legal opinions, dated the Closing Date and addressed
to Purchaser, in form and substance satisfactory to Purchaser.
(e) Solvency. On the Closing Date, Purchaser shall have
received from the chief financial officer or other qualified officer of each of
Parent and the Company respectively, that the Parent or the Company, as
applicable, and immediately after giving effect to the sale of the Note and the
other transactions contemplated by this Agreement, will be, Solvent.
(f) Appraisal. An appraisal reasonably acceptable to Purchaser
setting forth the value of the Collateral.
(g) Representations and Warranties True. The representations
and warranties contained in Article IV and elsewhere in this Agreement and the
representations and warranties contained in the Security Documents shall be true
on and as of the Closing Date with the same effect as if such representations
and warranties had been made on and as of the Closing Date. The Company shall
have performed all agreements on its part required to be performed under this
Agreement prior to the Closing Date; there shall exist on the Closing Date no
Default or Event of Default.
(h) Absence of Litigation, Orders. There shall not be pending
or threatened any action, suit, proceeding, governmental investigation or
arbitration against or affecting the Company or its Properties which seeks to
enjoin or restrain any of the transactions contemplated herein or hereby.
(i) Fees and Expenses. Purchaser shall have received all fees
due and payable in accordance with Section 2.05 hereof. The reasonable fees and
disbursements incurred by counsel for Purchaser, and the environmental
consultant of Purchaser in connection with the preparation of this Agreement and
the Security Documents and the transactions contemplated hereby and thereby
shall be paid in full by the Company or the Parent on the Closing Date.
ARTICLE VI
INFORMATION
Section 6.01. Information. The Company will furnish to the Holders, so
long as any of the Notes shall remain unpaid, in duplicate:
The Company shall deliver to the Holders, within 15 days after it files
the same with the
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SEC, copies of all reports and information (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe), if any, which
the Company is required to file with the SEC pursuant to Section 13 or 15(d) of
the Exchange Act.
If the Company is no longer subject to the filing and reporting
requirements of the SEC, the Company shall deliver to each Holder annual and
quarterly financial statements with appropriate footnotes of the Company and its
Subsidiaries, all prepared and presented in a manner substantially consistent
with such reporting requirements.
ARTICLE VII
INSPECTION OF PROPERTIES AND BOOKS
THIS SECTION INTENTIONALLY LEFT BLANK
ARTICLE VIII
COVENANTS
Section 8.01. Use of Proceeds. The Company shall use the net proceeds
derived from the sale of the Notes solely for repaying a portion of its
obligations under the TEC Note.
Section 8.02. Filing of Security Documents. The Company shall cause to
be filed with the proper government authorities all Security Documents as
contemplated by such documents promptly, and in no event later than three (3)
Business Days from the Closing Date.
Section 8.03. Further Assurances. The Company will from time to time
execute any and all further documents, financing statements, agreements,
mortgages, deeds of trust, and instruments, and take all further actions
(including filing Uniform Commercial Code financing statements), which may be
required under applicable law, or which the Holders may reasonably request, in
order to effectuate the transactions contemplated by this Agreement and in order
to grant, preserve, protect and perfect the validity and priority of the Liens
and security interests created by the Security Documents.
Section 8.04. Incorporation by Reference.
(a) Until all of the obligations of the Company with respect
to the Notes are paid in full, the Company shall perform, and shall cause each
of its Subsidiaries to perform, to the extent applicable thereto, each covenant
set forth at (i) Sections 4.3 through and including 4.6, 4.9 through
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and including 4.15 and 4.18 through and including 4.20 of the TEC Indenture and
(ii) Article V of the TEC Indenture as if fully set forth herein, and each such
covenant, together with each capitalized term used therein, is hereby
incorporated herein by reference thereto (such covenants and capitalized terms
are herein collectively referred to as the "TEC Indenture Covenants") provided,
however, that if any capitalized term used in the TEC Indenture Covenants is
defined herein, the definition herein shall control unless the context otherwise
requires.
(b) Upon the effective date of any waiver, amendment,
modification or supplement of any of the TEC Indenture Covenants effected
pursuant the terms and conditions of the TEC Indenture, each and every such
waiver, amendment, modification or supplement shall be effective to the TEC
Indenture Covenant applicable thereto without further action by the Company or
any Holder.
(c) In the event that for whatever reason the TEC Indenture
shall be terminated or is no longer in full force and effect, then each of the
TEC Indenture Covenants shall continue to be applicable hereto as incorporated
herein in the form and substance of each such TEC Indenture Covenant on the
Business Day immediately prior to the date of such termination or cessation, and
shall remain in full force and effect with respect hereto until waived, amended,
modified or supplemented in accordance with the terms hereof.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.01. Events of Default; Remedies. If any of the following
events (herein called "Events of Default") shall have occurred and be continuing
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or by operation of law or otherwise):
(a) the Company shall default in the due and punctual payment
or prepayment of all or any part of the principal of any Note when and as the
same shall become due and payable, whether at stated maturity, by acceleration,
by notice of prepayment or otherwise;
(b) the Company shall default in the due and punctual payment
or prepayment of (i) any interest on any Note or (ii) any other amounts payable
hereunder or under any Security Document (other than those amounts referred to
in Section 9.01(a)), when and as such interest or other amounts shall become due
and payable, and such default shall continue for a period of five Business Days,
which period shall commence to run after written notice to the Company from the
Holders having at least 25% of the outstanding principal amount of all Notes
with respect to amounts covered in clause (ii);
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(c) the Company shall default in the performance or observance
of any of the covenants, agreements or conditions set forth in any of Sections
4.3, 4.11, 4.14, or 5.1 of the TEC Indenture, each as incorporated herein by
reference (such reference to incorporate any grace period applicable thereto
under the TEC Indenture) thereto pursuant to Section 8.04, and otherwise subject
to the provisions thereof;
(d) the Company shall default in the performance or observance
of any of the covenants, agreements or conditions contained in this Agreement or
otherwise incorporated herein by reference thereto, or any of the Security
Documents (other than those covenants referred to or described in Section
9.01(a), 9.01(b) and 9.01(c)), and such default shall continue for a period of
thirty (30) days, after written notice thereof to the Company from the Holders
having at least 25% of the outstanding principal amount of all Notes.
(e) the Company shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee
or liquidator of itself or of all or a substantial part of its Property, (ii) be
generally unable to pay its indebtedness as such indebtedness becomes due, (iii)
make a general assignment for the benefit of its creditors, (iv) commence a
voluntary case under the Bankruptcy Code, (v) file a petition seeking to take
advantage of any other law providing for the relief of debtors, (vi) fail to
controvert in a timely or appropriate manner, or acquiesce in writing to, any
petition filed against it in an involuntary case under the Bankruptcy Code,
(vii) admit in writing its inability to pay its debts generally as such debts
become due, (viii) take any action under the laws of its jurisdiction of
organization analogous to any of the foregoing, or (ix) take any requisite
action for the purpose of effecting any of the foregoing;
(f) a proceeding or case shall be commenced, without the
application or consent of the Company in any court of competent jurisdiction,
seeking (i) the liquidation, reorganization, dissolution, winding up of the
Company or composition or readjustment of the indebtedness of any of them, (ii)
the appointment of a trustee, receiver, custodian, liquidator or the like of the
Company, or of all or any substantial part of the assets of any of them, or
(iii) similar relief in respect of the Company under any law providing for the
relief of debtors, and such proceeding or case shall continue undismissed, or
unstayed and in effect, for a period of 60 days; or an order for relief shall be
entered in an involuntary case under the Bankruptcy Code, against the Company,
or action under the laws of the jurisdiction of organization of any of the
Company analogous to any of the foregoing shall be taken with respect to any of
the Company and shall continue undismissed, or unstayed and in effect, for a
period of 60 days;
(g) final judgment for the payment of money shall be rendered
by a court of competent jurisdiction against the Company, and the Company shall
not discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereof, within twenty days from the date
of entry thereof and within said period of twenty days, or such longer
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period during which execution of such judgment shall have been stayed, appeal
therefrom and cause the execution thereof to be stayed during such appeal, and
such judgment together with all other such judgments shall exceed in the
aggregate One Hundred Thousand Dollars ($100,000) (excluding all or any portion
of such judgment or judgments covered by insurance maintained with one or more
financially sound insurers that are obligated to pay such portion; provided,
however, that the Company shall have provided an officer's certificate to the
Holders not later than three Business Days after the date the related judgment
is rendered certifying that the Company has filed, or expects to file promptly,
a claim or claims with such insurer or insurers and has no reason to believe
that such insurer or insurers will not pay the claims in respect thereof in
full);
(h) (i) any representation or warranty made by or on behalf of
the Company in this Agreement or the Security Documents, or in any financial
statement, certificate or other instrument or document now or hereafter
delivered pursuant to or in connection with any provision of this Agreement or
the Security Documents that repeats such representations or warranties, shall
prove to be breached in any material respect or false or incorrect in any
material respect on the date as of which made (provided, however, that with
respect to the representations made in Section 4.18 of the Mortgage, such
representation shall be deemed to include a qualification for information
previously provided in writing to the Purchaser) or (ii) any representation,
warranty or statement made by or on behalf of the Company in any financial
statement, certificate or other instrument or document now or hereafter
delivered pursuant to or in connection with any provision of this Agreement or
the Security Documents, shall prove to be false or incorrect in any material
respect or breached in any material respect on the date as of which made;
(i) any provision of any of this Agreement, the Notes or the
Security Documents shall, for any reason, not be or shall cease to be in full
force and effect, or not be, or be asserted in writing by the Company not to be,
valid, binding and enforceable against any Person purported to be bound by it,
if the failure of such provision to be in full force and effect or to be valid,
binding and enforceable could be reasonably likely to have a Material Adverse
Effect;
(j) any of the Security Documents shall for any reason cease
to be in full force and effect, or shall cease to give the Holders for their
ratable benefit the Liens, rights, powers and privileges purported to be created
thereby including but not limited to, a perfected security interest in, and Lien
on, all of the Collateral in accordance with the terms thereof, if such
cessation would reasonably be expected to have a Material Adverse Effect;
(k) any Event of Default shall have occurred and be continuing
under the TEC Indenture which has not been waived by the necessary parties
thereto;
then (i) upon the occurrence of any Event of Default described in subsection (e)
or (f), the unpaid principal amount of all Notes, together with the interest
accrued thereon and all unpaid fees,
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expenses and other amounts owing under the provisions of this Agreement, the
Notes and the Security Documents, shall automatically become immediately due and
payable, all without presentment, demand, notice, declaration, protest or other
requirements of any kind, all of which are hereby expressly waived, or (ii) upon
the occurrence and during the continuance of any other Event of Default, the
Holders of more than twenty-five percent (25%) in outstanding principal amount
of the Notes may, by written notice to the Company, declare the unpaid principal
amount of all Notes to be, and the same shall forthwith become, immediately due
and payable, together with the interest accrued thereon and all unpaid fees,
expenses and other amounts owing under the provisions of this Agreement, the
Notes and the Security Documents, all without presentment, demand, notice,
protest or other requirements of any kind, all of which are hereby expressly
waived.
Section 9.02. Remedies. If any Event of Default shall have occurred and
be continuing, the Holders having at least 25% of the outstanding principal
amount of all Notes may proceed to protect and enforce their rights, either by
suit in equity or by action at law, or both, whether for the specific
performance of any covenant or agreement contained in this Agreement or in aid
of the exercise of any power granted in this Agreement, or in the Security
Documents, or in any out of court work out or restructuring, or in any
reorganization or liquidation case or proceeding that relates to or affects the
Company, the Parent or any Collateral, and such Holders may proceed to enforce
the performance of all obligations and payment of all sums due upon such Notes,
or under this Agreement or any Security Document, and such further amounts as
shall be sufficient to cover the reasonable costs and expenses of collection
(including all reasonable fees and disbursements of counsel, accountants,
appraisers, investment bankers, and all other professionals, experts, and
advisors of the Holders), or to enforce any other legal or equitable right of
the Holders.
Section 9.03. Remedies Cumulative. No remedy conferred herein or in the
Security Documents upon the Holders is intended to be exclusive of any other
remedy and each and every such remedy shall be cumulative and shall be in
addition to every other remedy given hereunder or now or hereafter existing at
law or in equity or otherwise.
Section 9.04. Remedies Not Waived. No course of dealing between Parent
or the Company and the Holders, and no delay or failure in exercising any rights
hereunder or under the Notes or the Security Documents in respect thereof, shall
operate as a waiver of any of the rights of the Holders.
ARTICLE X
THE NOTES
Section 10.01. Registration, Exchange, and Transfer of Notes. The
Company will keep at its principal executive office a register, in which,
subject to such reasonable regulations as it may prescribe, but at its expense
(other than transfer taxes, if any), the Company will provide for the
registration and transfer of Notes. Whenever any Note or Notes shall be
surrendered either at the
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principal executive office of the Company, or at the place of payment named in
the Note, for transfer or exchange, accompanied (if so required by the Company)
by a written instrument of transfer in form reasonably satisfactory to the
Company duly executed by the Holder thereof or by such Holder's attorney duly
authorized in writing, the Company will execute and deliver in exchange therefor
a new Note or Notes in such denominations as may be requested by such Holder, of
like tenor and in the same aggregate unpaid principal amount as the aggregate
unpaid principal amount of the Note or Notes so surrendered. Any Note issued in
exchange for any other Note or upon transfer thereof shall carry the rights to
unpaid interest, unpaid fees and other amounts owing pursuant to this Agreement,
the Notes and the Security Documents, and interest to accrue which were carried
by the Note so exchanged or transferred, and neither gain nor loss of interest
shall result from any such transfer or exchange. Any transfer tax or
governmental charge relating to such transaction shall be paid by the Holder
requesting the exchange. The Company and any of its agents may treat the Person
in whose name any Note is registered as the owner of such Note for the purpose
of receiving payment of the principal of, prepayment charge (if any) and
interest and other amounts on such Note and for all other purposes whatsoever,
whether or not such Note be overdue.
Section 10.02. Lost, Stolen, Damaged and Destroyed Notes. At the
request of any Holder, the Company will issue and deliver at its expense, in
replacement of any Note or Notes lost, stolen, damaged or destroyed, upon
surrender thereof, if mutilated, a new Note or Notes in the same aggregate
unpaid principal amount, and otherwise of the same tenor, as the Note or Notes
so lost, stolen, damaged or destroyed, duly executed by the Company. The Company
may condition the replacement of a Note or Notes reported by the Holder thereof
as lost, stolen, damaged or destroyed, upon the receipt from such Holder of an
indemnity or security reasonably satisfactory to the Company.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Amendment and Waiver. No amendment or waiver of any
provision of this Agreement or the Notes or any Security Document or any consent
to any departure by the Company therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Holders representing more
than fifty percent (50%) of the aggregate principal amount of the Notes then
outstanding. Without the specific prior written consent of the Holders
representing more that sixty-six Percent (66%) of the aggregate principal amount
of the Notes then outstanding, no such amendment, waiver or consent shall
release or subordinate any of the Liens created by the Security Documents. No
such amendment, waiver or consent which purports to (i) reduce the principal of,
or the rate of interest on, any Note, (ii) extend the time for payment of all or
any portion of the principal of or interest on any Note or (iii) amend, modify
or waive any provision of this Section 11.01 shall be effective with respect to
any Note unless the Holder of such Note has given its specific
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prior written consent thereto. Any such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. Neither any
failure nor any delay on the part of the Holders in exercising any right, power
or privilege hereunder or under the Notes or any of the Security Documents shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. Except as otherwise provided herein or in the Notes
or any Security Document, no notice to or demand on the Company in any case
shall entitle the Company to any other or further notice or demand in the same,
similar or other circumstances.
Section 11.02. Expenses and Taxes. The Company agrees, whether or not
the transactions hereby contemplated shall be consummated, to pay, indemnify and
save the Holders harmless against any and all liabilities for the payment of (i)
all reasonable out-of-pocket expenses arising in connection with the
preparation, negotiation, execution and delivery of this Agreement, the Notes,
the Security Documents and the other instruments and documents hereby and
thereby contemplated and the closing of the transactions contemplated hereby,
(ii) all such expenses incurred with respect to the enforcement of any provision
of any such agreement or instrument, (iii) all reasonable expenses reasonably
incurred in connection with the reproduction of such agreements and instruments
and all stamp and other similar taxes (together in each case with interest and
penalties, if any) which may be payable in respect of the execution and delivery
of such agreement or instruments; provided, however, that the Company shall not
be responsible for taxes arising out of any assignment or transfer of the Notes,
(iv) all reasonable fees, taxes and other charges incurred in connection with
the filing or recording of any Security Documents (at or subsequent to the
Closing Date) and in connection with any Lien, tax and judgment searches
(including searches undertaken subsequent to the Closing Date), including
appraisal, survey and other title costs, (v) the reasonable fees and
disbursements of any special or local counsel in connection with the preparation
of such agreements and instruments and the transactions hereby and thereby
contemplated, (vi) all reasonable expenses incurred by the Holders (including
all fees and disbursements of counsel, accountants, appraisers, investment
bankers, and all other professionals, experts, and advisors of the Holders) in
connection with any amendment or requested amendment of, or waiver or consent or
requested waiver or consent under or with respect to, this Agreement, the Notes
or any of the Security Documents, whether or not the same shall become effective
(including counsel fees and disbursements), (vii) all reasonable expenses
incurred by the Holders (including all fees and disbursements of counsel,
accountants, appraisers, investment bankers, and all other professionals,
experts, and advisors of the Holders) following the occurrence and during the
continuance of any Default or Event of Default or incident to the negotiation of
any workout, restructuring or similar arrangement relating to the Company or any
Collateral, including any reorganization or liquidation case or proceeding,
whether or not suit is commenced, and (viii) all other reasonable obligations,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of, or
in any other way arising out of or relating to, this Agreement, the Notes or the
Security Documents or any other documents
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contemplated by or referred to herein or therein or any action taken or omitted
to be taken by the Holders with respect to any of the foregoing; provided,
however, that the Holders shall not be entitled to the payment and
indemnification set forth in clause (viii) in connection with any action taken
or omitted to be taken by the Holders that is judicially determined by a court
of competent jurisdiction in a final judgment not subject to appeal to have
resulted from the bad faith, willful misconduct or gross negligence of the
Holders; provided, further, that the Company shall not be required to pay the
fees and expenses for more than one law firm with respect to expenses incurred
by the Holders having at least 25% of the outstanding principal amount of all
Notes as described in clauses (vi), (vii) or (viii) above. The obligations of
the Company under this Section 11.02 shall survive the payment or prepayment in
full or transfer of any Note, the enforcement of any provision hereof or
thereof, any such amendments, waivers or consents, any such Default or Event of
Default, and any such workout, restructuring or similar arrangement.
Section 11.03. Survival of Representations and Warranties. All
representations and warranties contained herein or made in writing by or on
behalf of any party to this Agreement or in any document, certificate or
statement delivered hereto or otherwise in connection herewith, shall (i)
survive the execution and delivery of this Agreement and the delivery of the
Notes to Purchaser and shall continue in effect as long as any one of the Notes
is outstanding and thereafter shall survive as provided in Sections 11.02 and
11.06, and (ii) be deemed to have been relied upon by the Holders, regardless of
any investigation made by the Holders or on its behalf.
Section 11.04. Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the
benefit of the Company, the Holders and their respective successors and assigns;
provided, however, that the Company shall not have the right to assign its
rights hereunder or any interest herein or to delegate any of its duties
hereunder without the prior written consent of the Holders.
(b) Purchaser represents that (i) it is either (x) an
"accredited investor" as such term in defined in Rule 501 (a) of Regulation D
promulgated under the Securities Act, or (y) not a U.S. Person as defined in
Rule 902 of Regulation S promulgated under the Securities Act, and (ii) it is
purchasing the Notes for its own account for investment and not with a view to a
public distribution thereof (within the meaning of the Securities Act and rules
and regulations promulgated thereunder). Each Note shall bear a restrictive
legend in substantially the following form:
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THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND MAY NOT BE SOLD EXCEPT PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT, OR AN EXEMPTION FROM
REGISTRATION, UNDER SAID ACT.
(c) Subject to compliance with applicable Federal securities
laws and regulations and state "blue sky" laws and regulations, Purchaser may at
any time sell or assign to any Person all or any part of its rights in the Notes
and in the obligations of the Company and the obligations of Purchaser under
this Agreement, the Notes and the Security Documents (including the obligations
of Purchaser to purchase Notes), and each such assignee shall assume the rights
and obligations of Purchaser hereunder and thereunder, to the extent of such
assignment, pursuant to an instrument in writing executed by such assignee and
Purchaser. Execution and delivery of such an instrument shall be deemed to be a
representation by such assignee that the factual statements contained in Section
11.04(b) are true with respect to such assignee. Upon execution and delivery of
such an instrument, such assignee shall be a party to this Agreement and shall
have the rights and obligations of Purchaser (including it rights under this
Section 11.04(c)), to the extent of such assignment, and the assignor shall be
released from its obligations hereunder to a corresponding extent. Upon the
consummation of any assignment pursuant to this Section 11.04(c), the assignor
and the Company shall make appropriate arrangements so that, if required, new
Notes shall be issued to Purchaser and the assignee. Purchaser shall give the
Company prior written notice of the date that any such assignment shall become
effective, which date shall be no less than 10 days after the date such notice
is given.
Section 11.05. Notices. Except as otherwise provided herein, all
notices and service of process required, contemplated, or permitted hereunder or
with respect to the subject matter hereof shall be in writing, and shall
conclusively be deemed to have been validly served, given or delivered upon: (a)
completed transmission by facsimile or hand delivery during normal business
hours or; (b) the first Business Day after (i) deposit with an overnight courier
service or overnight mail delivery service (ii) completed transmission by
facsimile or hand delivery after normal business hours; or (c) the third
calendar day after deposit in the United States mails, with proper first class
postage prepaid, and shall be addressed to the party to be notified as follows:
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in the case of the Company, to:
TransAmerican Refining Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇ ▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
in the case of Purchaser, to:
c/o Merrill ▇▇▇▇▇ Asset Management
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ Lathsbury
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address or telecopy number or to the attention of such other
Person as any of such Persons shall have advised the other by notice to any
Holder at its registered address in the manner herein specified.
Section 11.06. Indemnification. In consideration of the execution and
delivery of this Agreement by Purchaser the Company hereby agrees to defend,
indemnify, exonerate and hold harmless the Holders and each of their officers,
directors, stockholders, affiliates, trustees, employees and agents, and each
other Person, if any, controlling the Holders or any of their Affiliates (herein
collectively called the "Indemnitees") from and against any and all actions,
causes of action, suits, losses, liabilities and damages, and reasonable
expenses in connection therewith, including reasonable counsel fees and
disbursements incurred in the investigation and defense of claims and actions
(herein collectively called the "Indemnified Liabilities"), incurred by the
Indemnitees or any of them as a result of, or arising out of or relating to:
(a) this Agreement, the Notes, the Security Documents, the
purchase of the Notes or the other transactions contemplated hereby or thereby,
or any action or failure to act by the Company with respect thereto (including
statements or omissions made, or information provided by the Company or its
Subsidiaries, officers, employees or agents); or
(b) any Environmental Matter, any Environmental Law or the
actual or alleged existence or release of any Material of Environmental Concern;
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except for any such Indemnified Liabilities that are finally judicially
determined to have resulted from the Indemnitee's gross negligence or wilful
misconduct. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Company hereby agrees to make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law. The obligations of the
Company under this Section 11.06 shall be in addition to any liability that the
Company may otherwise have and shall survive the payment or prepayment in full
or transfer of any Note and the enforcement of any provision hereof or thereof.
Nothing in this Section 11.06 shall limit, negate or release, or in any way
obligate the Company to indemnify the Holders for any breach of any of the
Holders' obligations under this Agreement or any of the Security Documents.
Section 11.07. Public Announcements. The Company and the Holders agree
that they will not issue any press release or make any other public
announcement, statement or filing with regard to this Agreement, the Notes or
the other Security Documents or the transactions hereby or thereby contemplated
without the prior approval, in each case, of the other parties to this
Agreement, which approval shall not be withheld in any case where such press
release, public announcement, statement or filing is required by applicable law
(including applicable rules and regulations of the SEC).
Section 11.08. No Fiduciary Relationship. The relationship between the
Holders, on the one hand, and the Company, on the other hand, is solely that of
debtor and creditor, and the Holders shall not be deemed to have any fiduciary
or other special relationship with the Company or any of its Subsidiaries. No
provision of this Agreement, the Notes or any of the Security Documents shall be
construed to create a fiduciary duty on the part of the Holders in favor of the
Company, any of its Subsidiaries or Affiliates, or their respective directors,
officers, employees, agents, stockholders or creditors.
Section 11.09. Integration and Severability. This Agreement, the Notes
and the Security Documents embody the entire agreement and understanding between
the Holders and the Company, and supersedes all prior agreements and
understandings relating to the subject matter hereof. In case any one or more of
the provisions contained in this Agreement or in any instrument contemplated
hereby for such date, or any application thereof, shall be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein, and any other application
thereof, shall not in any way be affected or impaired thereby.
Section 11.10. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall together constitute one and the same instrument.
Section 11.11. Governing Law. The laws of the State of New York
(without regard to principles of conflict of laws that would cause the
application of the laws of any other jurisdiction)
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shall govern the construction, interpretation, and enforceability of this
Agreement and any dispute, case or controversy arising in or under or related to
or connected with this Agreement or the relationship between or among the
parties hereto, whether sounding in tort, contract, or other legal or equitable
relief.
SECTION 11.12. SUBMISSION TO JURISDICTION; WAIVER OF SERVICE AND
VENUE.
(a) THE COMPANY CONSENTS AND AGREES TO THE JURISDICTION AND
VENUE OF ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF NEW YORK, STATE OF
NEW YORK, AND WAIVES ANY OBJECTION BASED ON VENUE OR FORUM NON CONVENIENS WITH
RESPECT TO ANY ACTION OR PROCEEDING ARISING IN OR UNDER OR RELATED TO THIS
AGREEMENT INSTITUTED THEREIN, AND AGREES THAT ANY DISPUTE CONCERNING THE
RELATIONSHIP AMONG THE HOLDERS, ON THE ONE HAND, AND THE COMPANY, ON THE OTHER
HAND, OR THE CONDUCT OF ANY PARTY IN CONNECTION WITH THIS AGREEMENT OR OTHERWISE
SHALL BE HEARD ONLY IN THE COURTS DESCRIBED ABOVE EXCEPT AS OTHERWISE PROVIDED
IN SECTION 11.12(c).
(b) THE COMPANY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY
HAND DELIVERY TO IT AT ITS ADDRESS SET FORTH ABOVE IN SECTION 11.05, OR, AT THE
OPTION OF THE HOLDERS, BY SERVICE UPON CT CORPORATION SYSTEM, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇, WHICH THE COMPANY IRREVOCABLY APPOINTS AS SUCH PERSON'S AGENT
FOR THE PURPOSE OF ACCEPTING SERVICE OF PROCESS WITHIN THE STATE OF NEW YORK. IN
ADDITION, THE HOLDERS AGREE TO PROMPTLY FORWARD, BY FIRST CLASS MAIL, HAND
DELIVERY OR FACSIMILE ANY PROCESS SO SERVED UPON SAID AGENT TO THE COMPANY, AS
APPLICABLE, AT ITS ADDRESS SET FORTH ABOVE IN SECTION 11.05. THE COMPANY HEREBY
CONSENTS TO SERVICE OF PROCESS AS AFORESAID.
(c) NOTHING IN THIS SECTION 11.12 SHALL AFFECT THE RIGHT OF
THE HOLDERS TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
AFFECT THE RIGHT OF THE HOLDERS TO BRING ANY ACTION OR PROCEEDING AGAINST THE
COMPANY OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
SECTION 11.13. MUTUAL WAIVER OF RIGHT TO TRIAL BY JURY. EACH OF
THE COMPANY AND THE HOLDERS ACKNOWLEDGES THAT IT MAY HAVE A
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CONSTITUTIONAL RIGHT TO TRIAL BY JURY OF CERTAIN DISPUTES. HOWEVER, BECAUSE
DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST
QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE
PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION
RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING
SUCH APPLICABLE LAWS. EACH OF THE COMPANY AND THE HOLDERS HEREBY WAIVES ANY
RIGHT TO TRIAL BY JURY OF (I) ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
ARISING UNDER THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH; OR (II) CLAIMS IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM IN RESPECT TO THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR
AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS
RELATED HERETO, AND (III) ANY CLAIMS FOR DAMAGES, BREACH OF CONTRACT, SPECIFIC
PERFORMANCE, OR ANY EQUITABLE OR LEGAL RELIEF OF ANY KIND HEREUNDER OR
THEREUNDER, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE. EACH OF THE COMPANY AND THE HOLDERS
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.
SECTION 11.14. RELEASE OF COLLATERAL; SUBORDINATION.
(a) Holders shall release all Liens created by the Mortgages
or Security Documents upon indefeasible payment in full of the Notes on any
Maturity Date or Redemption Date.
(b) Holders shall release or subordinate any Liens created by
the Mortgages or Security Documents to the extent such Liens are identified for
release or subordination in a consent obtained in accordance with Section 11.01.
(c) Holders shall release or subordinate the Lien created by
the Mortgages or Security Documents on Dock No. 1 (designated Dock No. 2 in the
Survey) upon the consummation of an offer to purchase (regardless of the
principal amount of Notes tendered in connection with such offer to purchase)
pursuant to clause (ii) of Section 3.02(c).
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(d) Holders shall, upon request by the Company, subordinate
the Lien created by the Mortgages or Security Documents to any Lien described in
and meeting the requirements of clauses (d), (k) or (t) of the definition of
"Permitted Liens" provided, however, that Holders shall not be required to
subordinate the Lien created by the Mortgages or Security Documents on Dock No.
1 (designated Dock No. 2 in the Survey), except pursuant to Section 11.14(c).
(e) Holders shall from time to time execute and deliver (at
the expense of the Company) any and all further documents and instruments and
take such further actions as the Company may reasonably request to effectuate
the transactions contemplated by this Section 11.14.
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IN WITNESS WHEREOF, the Company and Purchaser have executed this
Agreement by their duly authorized officers as of the date first written above.
TRANSAMERICAN REFINING CORPORATION
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ CORPORATE BOND FUND,
INC. - HIGH INCOME PORTFOLIO
By:
---------------------------------------
Title: Authorized Representative
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EXHIBIT A
[FORM OF SENIOR SECURED NOTE]