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EXHIBIT 10.72
FOURTH SUPPLEMENT TO PRODUCTION
PAYMENT CONVEYANCE
THIS FOURTH SUPPLEMENT TO PRODUCTION PAYMENT CONVEYANCE (this
"Supplement"), dated as of the date set out at the end hereof, is made by
TransTexas Gas Corporation, a Delaware corporation ("Grantor"), Mirant Americas
Energy Capital, LP, formerly named Southern Producer Services, L.P. ("SPS"), and
TCW DR VI Investment Partnership, L.P. ("Fund VI"). SPS and Fund VI are herein
collectively called "Grantee".
RECITALS:
A. Effective as of March 1, 2000, Grantor executed in favor of Grantee
that certain Production Payment Conveyance dated as of March 14, 2000
(as heretofore amended or supplemented, the "Original Conveyance"). The
Original Conveyance has been recorded as set forth in Schedule 1
hereto; all capitalized terms used but not defined herein shall have
the meanings assigned to them in the Original Conveyance.
B. Pursuant to the Original Conveyance, TCW Portfolio No. 1555 DR V
Sub-Custody Partnership, L.P. ("Fund V") was originally included within
"Grantee". Effective as of December 1, 2000, Fund V assigned all of its
right, title, and interest under the Original Conveyance to SPS
pursuant to that certain Conveyance of Interest in Production Payment
of even date herewith (the "Fund V Assignment").
C. Grantee and Grantor desire to supplement and amend the Original
Conveyance, as set forth herein, to (i) take into account the Fund V
Assignment, (ii) make additional properties subject to the Original
Conveyance, and (iii) account for the payment by SPS of additional
funds to Grantor.
D. As described in Section 8.7 of the Original Conveyance, and pursuant to
the Purchase Agreement referred to in the Original Conveyance, Fund VI
has appointed TCW Asset Management Company to act as its agent in
connection with supplements and amendments to the Original Conveyance.
SUPPLEMENTS AND AGREEMENTS:
FOR A GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of
which are hereby acknowledged, Grantor and Grantee do hereby agree, act and
covenant as follows:
1. Effective as of 9:00 a.m. Houston, Texas time, on February 7, 2001
(the "Effective Time"), the Original Conveyance is amended in order to add the
amount of Nineteen Million Eight Hundred Thousand Dollars ($19,800,000) to the
unliquidated balance of the Primary Sum, as such unliquidated balance stood as
of the Effective Time after giving effect to all applications of PP Proceeds
made before the Effective Time. After giving effect to such amendment (and to
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such application of PP Proceeds), the unliquidated balance of the Primary Sum as
of the Effective Time is $32,532,142. (Any PP Proceeds received after the
Effective Time on February 7, 2001 shall be deemed to have been received on the
next following Business Day.)
2. All of the terms and provisions of the Original Conveyance, as the
same is amended and supplemented hereby, are ratified, adopted, affirmed and
renewed, and remain in full force and effect for the benefit of Grantee, the
Beneficiaries, Funds Agent, and their respective successors and assigns.
3. The definition of "Dedication Percentage" in Section 1.1 of the
Original Conveyance is hereby amended in its entirety to read as follows:
" 'Dedication Percentage' means:
(a) fifty percent (50%) from the Initial Time until 9:00 a.m.,
Texas time, on September 1, 2000;
(b) sixty-two percent (62%) from 9:00 a.m., Texas time, on
September 1, 2000 until 9:00 a.m., Texas time, on December 1, 2000;
(c) thirty percent (30%) from and after 9:00 a.m., Texas time,
on December 1, 2000 until 9:00 a.m., Texas time, on June 1, 2001;
(d) sixty-five percent (65%) from and after 9:00 a.m., Texas
time, on June 1, 2001 until 9:00 a.m., Texas time, on June 1, 2002; and
(e) seventy percent (70%) from and after 9:00 a.m., Texas
time, on June 1, 2002."
4. Exhibit A to the Original Conveyance is hereby amended and
supplemented, effective as of the Effective Time, to include at the end thereof
Exhibit A hereto (herein called "Additional Exhibit A").
5. The terms "NRI Percentage," "PP Hydrocarbons," "Subject
Hydrocarbons," "Subject Interests," "Subject Lands," and "Subject Wells," as
such terms are defined and used in the Original Conveyance, are hereby amended,
effective as of the Effective Time, in order to take into account and recognize
the addition of Additional Exhibit A hereto to the end of Exhibit A as attached
to the Original Conveyance, and all other direct or indirect references in the
Original Conveyance shall likewise be considered amended in order to take into
account and recognize such amendment and the addition of Additional Exhibit A
hereto to the end of Exhibit A as attached to the Original Conveyance.
6. For the above-recited consideration, Grantor does hereby, in order
to more fully effectuate the amendments and other provisions herein contained,
GRANT, BARGAIN, SELL, CONVEY, ASSIGN, TRANSFER, SET OVER and DELIVER unto
Grantee, as a production
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payment, to be held in undivided interests in proportion to their Percentage
Shares, a term overriding royalty interest carved out of and burdening the
Subject Interests (including the "Additional Subject Interests," as defined
below) equal to and measured by all "Additional PP Hydrocarbons," as defined
below, in, under and that may be produced from (or, to the extent pooled or
unitized, allocated to) the Subject Lands (including the "Additional Subject
Lands," as defined below), with such production payment to be effective as to
deliveries of Additional PP Hydrocarbons as of the Effective Time, and to
terminate as of the Termination Time.
TO HAVE AND TO HOLD the above-described production payment, upon and
subject to the terms of the Original Conveyance, as amended hereby, unto
Grantee, and its successors and Permitted Assigns, until the Termination Time.
As used herein, the following terms have the following meanings:
(a) "Additional PP Hydrocarbons" means the Dedication Percentage
of the NRI Percentage (as the definitions of such terms are
amended herein) of:
(i) all Hydrocarbons in, under or that may be produced
from (or, to the extent pooled or unitized, allocated
to) any Additional Subject Lands prior to the
Termination Time (as determined after giving effect
to this Supplement), and
(ii) all other Hydrocarbons in, under or that may be
produced from (or, to the extent pooled or unitized,
allocated to) the Subject Lands prior to the
Termination Time, as determined after giving effect
to this Supplement and the instrument listed as item
2 on Schedule 1 hereto (this Supplement and such
other instruments being herein collectively called
the "Supplements"), to the extent such Hydrocarbons
are included within the PP Hydrocarbons as a result
of the Termination Time being changed because of the
Supplements.
(b) "Additional Subject Interests" means:
(i) All of the leasehold interests and other property
interests described in Additional Exhibit A; and
(ii) Without limitation of the foregoing, all other right,
title and interest (of whatever kind or character,
whether legal or equitable and whether vested or
contingent) of Grantor in and to the oil, gas and
other minerals in and under or that may be produced
from the Additional Subject Lands (including
interests in oil, gas or mineral leases to the extent
the same cover such lands, overriding royalties,
production payments and net profits interests in such
lands or such leases, and fee mineral interests, fee
royalty interests and other interests in such oil,
gas and other minerals) even
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though Grantor's interest in such oil, gas and other
minerals may be incorrectly described in, or omitted
from, Additional Exhibit A; and
(iii) All rights, titles and interests of Grantor in and
to, or otherwise derived from, all presently existing
and valid oil, gas or mineral unitization, pooling,
or communitization agreements, declarations or orders
and in and to the properties covered and the units
created thereby (including all units formed under
orders, rules, regulations, or other official acts of
any federal, state, or other authority having
jurisdiction, voluntary unitization agreements,
designations or declarations, and so-called "working
interest units" created under operating agreements or
otherwise) relating to the properties described in
subsections (i) or (ii) above in this definition.
(c) "Additional Subject Lands" means the lands and depths
described in Additional Exhibit A hereto (where no depth limit
is specified, Additional Subject Lands shall include all
depths).
Without limitation of the generality of the provisions of Section 5,
above, or of the foregoing provisions of this Section 6, effective as to
deliveries of Additional PP Hydrocarbons at and after the Effective Time, the
definition of PP Hydrocarbons as found in the Original Conveyance is hereby
amended to include all Additional PP Hydrocarbons, as defined herein, the
definition of Subject Lands as found in the Original Conveyance is hereby
amended to include all Additional Subject Lands, as defined herein, and the
definition of Subject Interests as found in the Original Conveyance is hereby
amended to include all Additional Subject Interests, as defined herein; the term
"Initial Time", as found in the definition of "Subject Hydrocarbons" in the
Original Conveyance, shall be deemed to refer to the Effective Time, as such
term is defined herein, but only as to Additional PP Hydrocarbons, and the
Original Conveyance is amended to so provide.
7. All of the terms and provisions of the Original Conveyance, as the
same is amended and supplemented hereby, are ratified, adopted, affirmed and
renewed, and remain in full force and effect for the benefit of Grantee, the
Beneficiaries, Funds Agent, and their respective successors and assigns. To the
extent, if any, required to give effect to the Supplements or to the
ratification, adoption, affirmation and renewal provided for in the preceding
sentence, Grantor does hereby GRANT, BARGAIN, SELL, CONVEY, ASSIGN, TRANSFER,
SET OVER AND DELIVER unto Grantee, as a production payment, to be held in
undivided interests in proportion to their Percentage Shares, a term overriding
royalty interest carved out of and burdening the Subject Interests equal to and
measured by all PP Hydrocarbons in and under and that may be produced from (or,
to the extent pooled or unitized, allocated to) the Subject Lands, with such
production payment to terminate as of the Termination Time and to be held upon
and subject to the terms of the Original Conveyance as amended hereby.
8. The definition of "Percentage Share" in Section 1.1 of the Original
Conveyance is hereby amended in its entirety to read as follows:
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" 'Percentage Share' means, with respect to each Person
included in Grantee, the fractional undivided interest which it owns in
the Production Payment at the time in question. From the initial grant
of the Production Payment until 9:00 a.m. Houston, Texas time, on June
7, 2000, the Percentage Share of each Person included in Grantee was as
follows:
Fund V 42.859594%
Fund VI 21.429797%
SPS 35.710609%
From and after 9:00 a.m. Houston, Texas time, on June 7, 2000, until
9:00 a.m. Houston, Texas time, on September 8, 2000, the Percentage
Share of each Person included in Grantee was as follows:
Fund V 33.048697%
Fund VI 16.524349%
SPS 50.426954%
From and after 9:00 a.m. Houston, Texas time, on September 8, 2000,
until 9:00 a.m. Houston, Texas time, on November 7, 2000, the
Percentage Share of each Person included in Grantee was as follows:
Fund V 22.863142%
Fund VI 11.431571%
SPS 65.705287%
From and after 9:00 a.m. Houston, Texas time, on November 7, 2000,
until 9:00 a.m. Houston, Texas time, on December 1, 2000, the
Percentage Share of each Person included in Grantee was as follows:
Fund V 19.08294%
Fund VI 9.54147%
SPS 71.37559%
From and after 9:00 a.m. Houston, Texas time, on December 1, 2000,
until 9:00 a.m. Houston, Texas time, on February 7, 2001, the
Percentage Share of each Person included in Grantee was as follows:
Fund VI 9.54147%
SPS 90.45853%
From and after 9:00 a.m. Houston, Texas time, on February 7, 2001, the
Percentage Share of each Person included in Grantee is as follows:
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Fund VI 3.71408%
SPS 96.28592%"
The foregoing Percentage Shares of Fund VI and SPS, respectively, taking effect
as of February 7, 2001, are in this Amendment called their "amended Percentage
Shares".
9. In consideration of the additional purchase price payment made by
SPS to Grantor and the foregoing increase in the unliquidated balance of the
Primary Sum:
(a) Fund VI does hereby GRANT, BARGAIN, SELL, CONVEY, ASSIGN,
TRANSFER, SET OVER and DELIVER unto SPS such additional undivided
interests in the Production Payment as are necessary in order to cause
SPS and Fund VI to own the Production Payment, at and after the
Effective Time, in undivided interests in proportion to their
respective amended Percentage Shares, and
(b) Fund VI does further assign unto SPS such undivided
interests in Fund VI's accounts receivable from the sale of PP
Hydrocarbons - to the extent such accounts receivable exist and are
unpaid at the Effective Time and arise from the sale of PP Hydrocarbons
before the Effective Time - as are necessary in order to cause SPS and
Fund VI to share in all collections of such accounts receivable after
the Effective Time in proportion to their respective amended Percentage
Shares.
TO HAVE AND TO HOLD the same, upon and subject to the terms of the
Original Conveyance, as amended hereby, unto SPS and its successors and
Permitted Assigns, until the Termination Time.
10. In order to take into account SPS's name change, all references to
"Southern Producer Services, L.P." in the Original Conveyance, as supplemented
hereby, shall refer to "Mirant Americas Energy Capital, LP" with respect to
matters occurring after the date hereof. In order to take into account the Fund
V Assignment, all references to "Grantee" in the Original Conveyance, as
supplemented hereby, shall refer only to SPS and Fund VI with respect to matters
occurring after the date hereof.
11. This Supplement may be executed in multiple counterparts, all of
which are identical.
12. This Supplement shall be binding upon and shall inure to the
benefit of the parties hereto, and their respective successors and assigns, and
all of the covenants and agreements contained in the Original Conveyance, as
amended hereby, shall be deemed to be covenants and agreements running with the
lands affected thereby.
13. This Supplement shall be governed by and construed in accordance
with the laws of the State of Texas, without regard to principles of conflicts
of laws.
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IN WITNESS WHEREOF, this Supplement is executed by the parties hereto
on the dates set out below in their respective acknowledgments, but effective as
of the Effective Time.
TRANSTEXAS GAS CORPORATION
By:
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Ed Donahue
Vice President
Grantor's address: 1300 North Sam Houston Parkway East
Suite 310
Houston, Texas 77032-2949
Attention: Ed Donahue, Vice President
Telephone: 281/987-8600
Telecopy: 281/986-8865
MIRANT AMERICAS ENERGY CAPITAL, LP
By: Mirant Americas Development, Inc.,
its general partner
By:
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David W. Stewart
Vice President
SPS's address: 1200 Smith Street
Suite 2890
Houston, Texas 77002
Attention: David W. Stewart
Telephone: 713/276-1902
Telecopy: 713/276-1990
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TCW DR VI INVESTMENT PARTNERSHIP, L.P.
By: TCW ASSET MANAGEMENT COMPANY, as
Agent
By:
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Kurt A. Talbot
Senior Vice President
Fund VI's address: c/o Trust Company of the West
865 South Figueroa
Los Angeles, California 90017
Attention: Thomas F. Mehlberg
Telephone: 213/244-0702
Telecopy: 213/244-0604
This document prepared by:
John W. Rain
Thompson & Knight L.L.P.
1700 Pacific Avenue, Suite 3300
Dallas, Texas 75201
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STATE OF TEXAS )
)
COUNTY OF HARRIS )
The foregoing instrument was acknowledged before me on this 7th day of
February, 2001, by Ed Donahue, the Vice President of TransTexas Gas Corporation,
a Delaware corporation, on behalf of such corporation.
-----------------------------
[SEAL] Notary Public, State of Texas
STATE OF TEXAS )
)
COUNTY OF HARRIS )
The foregoing instrument was acknowledged before me on this 7th day of
February, 2001, by David W. Stewart, the Vice President of Mirant Americas
Development, Inc., a Georgia corporation, on behalf of such corporation acting
as general partner of Mirant Americas Energy Capital, LP, a Delaware limited
partnership, and on behalf of such limited partnership.
-----------------------------
[SEAL] Notary Public, State of Texas
STATE OF TEXAS )
)
COUNTY OF HARRIS )
The foregoing instrument was acknowledged before me on this 7th day of
February, 2001, by Kurt A. Talbot, the Senior Vice President of TCW Asset
Management Company, a California corporation, on behalf of such corporation
acting as agent as aforesaid.
-----------------------------
[SEAL] Notary Public, State of Texas
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SCHEDULE 1
RECORDING SCHEDULE
1. Production Payment Conveyance among TCW Portfolio No. 1555 DR V
Sub-Custody Partnership, L.P., TCW DR VI Investment Partnership, L.P.,
Southern Producer Services, L.P. and TransTexas Gas Corporation.
Recording Jurisdiction Recording Data
---------------------- --------------
Calhoun County, TX Volume 262, Page 33,
Filed 9/19/2000
Chambers County, TX Document No. 00-448-604,
Filed 3/17/2000
Galveston County, TX Film Code #014-39-1028,
Filed 3/17/2000
Jim Hogg County, TX Volume 17, Page 362,
Filed 3/20/2000 Live
Oak County, TX Volume 449, Page 135,
Filed 3/20/2000
Wharton County, TX Volume 360, Page 596,
Filed 3/17/2000
Zapata County, TX Volume 629, Page 471,
Filed 3/17/2000
General Land Office of Texas Sent for filing
2. First Supplement to Production Payment Conveyance among TransTexas Gas
Corporation, Southern Producer Services, L.P., TCW Portfolio No. 1555
DR V Sub-Custody Partnership, L.P. and TCW DR VI Investment
Partnership, L.P.
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Recording Jurisdiction Recording Data
---------------------- --------------
Calhoun County, TX Volume 262, Page 114,
Filed 9/19/2000
Chambers County, TX Document No. 00-459-630
Filed 6/9/2000
Galveston County, TX Film Code 014-62-1617
Filed 6/9/2000
Jim Hogg County, TX Volume 19, Page 526,
Filed 6/9/2000
Live Oak County, TX Volume 450, Page 428,
Filed 6/12/2000
Wharton County, TX Volume 371, Page 458,
Filed 6/9/2000
Zapata County, TX Volume 634, Page 110,
Filed 6/9/2000
3. Second Supplement to Production Payment Conveyance among TransTexas Gas
Corporation, Southern Producer Services, L.P., TCW Portfolio No. 1555
DR V Sub-Custody Partnership, L.P. and TCW DR VI Investment
Partnership, L.P.
Recording Jurisdiction Recording Data
---------------------- --------------
Calhoun County, TX Volume 262, Page 132
Filed 9/19/2000
Chambers County, TX Document No. 00-470-562
Filed 9/18/2000
Galveston County, TX File Number 2000046945
Filed 9/15/2000
Jim Hogg County, TX File Number 65210
Filed 9/22/2000
Live Oak County, TX File Number 00149214
Filed 9/19/2000
Wharton County, TX Volume 383, Page 740,
Filed 9/19/2000
Zapata County, TX Volume 638, Page 642,
Filed 9/22/2000
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4. Third Supplement to Production Payment Conveyance among TransTexas Gas
Corporation, Southern Producer Services, L.P., TCW Portfolio No. 1555
DR V Sub-Custody Partnership, L.P. and TCW DR VI Investment
Partnership, L.P.
Recording Jurisdiction Recording Data
---------------------- --------------
Calhoun County, TX Volume 266, Page 205,
Filed 11/13/00
Chambers County, TX Document No. 00-477-116,
Filed 11/14/00
Galveston County, TX Film Code 015-08-1029
Filed 11/13/00
Jim Hogg County, TX Volume 22, Page 256,
Filed 11/13/00
Live Oak County, TX Volume 454, Page 239,
Filed 11/14/00
Wharton County, TX Volume 390, Page 480,
Filed 11/13/00
Zapata County, TX Volume 641, Page 169,
Filed 11/13/00
General Land Office of Texas Filed 12/22/00
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EXHIBIT A
TO
FOURTH SUPPLEMENT TO
PRODUCTION PAYMENT CONVEYANCE
ADDITIONAL SUBJECT INTERESTS
Wharton County, Texas
1. Oil, Gas and Mineral Lease dated March 16, 2000, between Jack
Northington Shwab and Clara Jane Lovell, as Lessor, and Prolithic
Resources Corp., as Lessee, recorded under Memorandum of Oil, Gas and
Mineral Lease at Volume 364, Page 306 of the Official Records of
Wharton County, Texas, covering 567.93 acres, more or less, in the
Alexander Edgar Survey, A-93, Wharton County, Texas. (TX 106-175/001A)
Working Interest: 100.00000%
Net Revenue Interest 75.00000%
2. Oil, Gas and Mineral Lease dated August 15, 1997, between Robert S.
Mortensen and Martha F. Middlebrook, Co-Trustees for Rocking M Land and
Cattle Company Trust, as Lessor and SKH Energy Partners, L. P., as
Lessee, recorded in Volume 248, Page 771 of the Official Records of
Wharton County, Texas, covering 180 acres, more or less, situated in
the J. P. Borden Survey, A-9, and the Alexander Edgar League, A-93,
Wharton County, Texas, INSOFAR AND ONLY INSOFAR as all depths below the
top of the Wilcox formation. (TX 106-693)
Working Interest: 100.00000%
Net Revenue Interest 76.00000%
3. Oil, Gas and Mineral Lease dated January 2, 2001, between Robert S.
Mortensen and Martha F. Middlebrook, Co-Trustees for Rocking M Land and
Cattle Company Trust, as Lessor, and TransTexas Gas Corporation, as
Lessee, recorded in Volume 396, Page 679 of the Official Records of
Wharton County, Texas, covering 180 acres, more or less, situated in
the J. P. Borden Survey, A-9, and the Alexander Edgar League, A-93,
Wharton County, Texas, INSOFAR AND ONLY INSOFAR as all depths between
the surface of the earth and the top of the Wilcox formation. (TX
106-693A)
Working Interest: 100.00000%
Net Revenue Interest 76.00000%
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Lease (1) above is subject to:
(a) the terms, conditions and provisions of that certain unrecorded Egypt
Prospect Agreement dated April 4, 2000, between Prolithic Resources
Corporation and TransTexas Gas Corporation, as amended by First
Amendment to Egypt Prospect Agreement dated June 20, 2000.
Lease (2) above is subject to:
(a) the terms, conditions and provisions of that certain Assignment of Oil,
Gas & Mineral Lease dated July 11, 2000, between Chesapeake Operating,
Inc., as Assignor, and TransTexas Gas Corporation, as Assignee,
recorded in Volume 376, Page 881 of the Official Records of Wharton
County, Texas.
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