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EXHIBIT 10.6
SEVENTH SUPPLEMENT TO PURCHASE AGREEMENT
THIS SEVENTH SUPPLEMENT TO PURCHASE AGREEMENT dated as of September 10,
2001 (this "Supplement"), is made by:
o TransTexas Gas Corporation, a Delaware corporation (herein called
"Grantor"),
o Mirant Americas Energy Capital, LP, formerly named Southern Producer
Services, L.P. ("SPS"),
o TCW DR VI Investment Partnership, L.P. ("Fund VI"), acting through its
agent, TCW Asset Management Company,
o TCW Global Project Fund Ltd. ("GPF"), acting through its agent, TCW
London International, Limited (SPS, Fund VI, and GPF are herein
collectively called, "Grantee"), and
o TCW London International, Limited ("TCW London"), as Agent on behalf
of GPF, and TCW Asset Management Company ("Tamco"), as Agent on behalf
of Fund VI (TCW London and Tamco are in such capacities herein
collectively called "Funds Agent").
RECITALS
1. Grantor, SPS, TCW Portfolio No. 1555 DR V Sub-Custody Partnership, L.P.
("Fund V"), Fund VI and Funds Agent have heretofore entered into that certain
Purchase Agreement dated as of March 14, 2000 (herein, as heretofore amended or
supplemented, called the "Original Purchase Agreement"), and, as contemplated
therein, Grantor has, by means of a Production Payment Conveyance dated as of
the same date (herein, as heretofore amended or supplemented, called the
"Original Conveyance"), conveyed to SPS, Fund V and Fund VI the "Production
Payment" as therein defined, burdening interests of Grantor in certain oil and
gas properties.
2. 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 dated as of February 7,
2001.
3. Effective as of September 10, 2001, SPS assigned to GPF an undivided
18.54493% interest in the Production Payment pursuant to that certain Partial
Conveyance of Production Payment and Seventh Supplement to Production Payment
Conveyance dated as of September 10, 2001 (the "GPF Assignment").
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NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, Grantor, SPS, Fund VI, GPF, and Funds Agent
hereby agree as follows:
ARTICLE I - Definitions and References
Section 1.1. Defined Terms and References. As used herein, the terms
"Original Conveyance", "Original Purchase Agreement", "Grantor", "SPS", "Fund
V", "Fund VI", "GPF", "Grantee", "Tamco", "TCW London", and "Funds Agent" have
the meanings given them above. Reference is also made to the Original Purchase
Agreement and to the Original Conveyance for the meaning of various terms
defined therein, all of which shall when used herein (unless otherwise expressly
defined herein) have the same meanings. For purposes of this Supplement, unless
the context otherwise requires, the following additional terms shall have the
following meanings:
"Current Closing Date" has the meaning given such term in Section 2.6.
"Current Conveyance Supplement" means the Partial Conveyance of Production
Payment and Seventh Supplement to Production Payment Conveyance executed by
Grantor and Grantee substantially in the form of Exhibit A hereto.
"Current Supplement Documents" means this Supplement, the Current
Conveyance Supplement, and all other Production Payment Documents delivered
substantially contemporaneously herewith.
"Production Payment Conveyance" means the Original Conveyance as amended
and supplemented by the Current Conveyance Supplement.
"Purchase Agreement" means the Original Purchase Agreement as supplemented
and amended hereby.
Section 1.2. Rules of Construction. All references in this Supplement to
articles, sections, subsections and other subdivisions refer to corresponding
articles, sections, subsections and other subdivisions of this Supplement unless
expressly provided otherwise. Titles appearing at the beginning of any of such
subdivisions are for convenience only and shall not constitute part of such
subdivisions and shall be disregarded in construing the language contained in
such subdivisions. The words "this Supplement, "this instrument", "herein",
"hereof", "hereby", "hereunder" and words of similar import refer to this
Supplement as a whole and not to any particular subdivision unless expressly so
limited. Unless the context otherwise requires: "including" (and its grammatical
variations) means "including without limitation"; "or" is not exclusive; words
in the singular form shall be construed to include the plural and vice versa;
words in any gender include all other genders; references herein to any
instrument or agreement refer to such instrument or agreement as it may be from
time to time supplemented or amended; and references herein to any Person
include such Person's successors and assigns. All references in this Supplement
to exhibits and schedules refer to the exhibits and schedules to this
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Supplement unless expressly provided otherwise, and all such exhibits and
schedules are hereby incorporated herein by reference and made a part hereof for
all purposes.
ARTICLE II - Amendments
Section 2.1. Agreement to Amend. Upon the terms and conditions of this
Supplement and the Purchase Agreement, Grantor and Grantee agree to amend and
supplement the Original Conveyance by executing and delivering the Current
Conveyance Supplement.
Section 2.2. Grantee. In order to take into account the GPF Assignment, (a)
all references to "Grantee" in the Original Purchase Agreement, as supplemented
hereby, shall refer to SPS, Fund VI, and GPF with respect to matters occurring
after the "Effective Time", as defined in the Current Conveyance Supplement, and
(b) all references to "Fund V" in the Original Purchase Agreement, as
supplemented hereby, shall refer to GPF with respect to matters occurring after
the "Effective Time", as defined in the Current Conveyance Supplement.
Section 2.3. Funds Agent. Subsections (a), (b), (h) and (i) of Section 6.10
of the Original Purchase Agreement are hereby amended and restated in their
entirety to read as follows:
(a) Funds Agent. Fund VI, for itself and for its successors and
assigns as owner of the Production Payment, has appointed Tamco as its
agent to act for and on behalf of Fund VI under and pursuant to this
Agreement and the other Production Payment Documents, and Tamco has
accepted such appointment. GPF has, by means of separate agreements,
appointed TCW London International, Limited ("TCW London") as its agent to
act for and on behalf of GPF under and pursuant to this Agreement and the
other Production Payment Documents, and TCW London has accepted such
appointment. Accordingly, as used herein, "Funds Agent" refers to Tamco,
acting on behalf of Fund VI, and to TCW London, acting on behalf of GPF,
provided that in subsections (b), (c), (d), (e) and (f) of this Section
6.10, "Funds Agent" refers only to Tamco acting on behalf of Fund VI. Funds
Agent is authorized to act on behalf of GPF and Fund VI in (i) exercising
rights and remedies with respect to any matter under any of the Production
Payment Documents, (ii) giving notices or instructions to Grantor or SPS,
(iii) receiving information from or notices by Grantor or SPS, (iv)
communicating to Grantor or SPS determinations required or permitted to be
made under this Agreement or any other Production Payment Document, and (v)
agreeing to, and executing and delivering, all Conveyance Supplements and
Purchase Agreement Supplements, the Production Sales Agreements and any
other agreements for the sale of PP Hydrocarbons, all other Production
Payment Documents, and all amendments, supplements, waivers or consents to,
of or under any Production Payment Documents. Funds Agent may, on behalf of
GPF and Fund VI, take any other action which GPF or Fund VI is entitled to
take hereunder or under any of the Production Payment Documents. Grantor
and SPS may rely on any action of Funds Agent as binding upon GPF and Fund
VI. Such appointment of Tamco as Funds Agent shall not, however, impair or
modify any rights, obligations or duties which Tamco or any of its
Affiliates otherwise has with respect to Fund VI. In its administration of
this Agreement and the other Production Payment Documents, except to the
extent to which another standard applies to Tamco by reason of any Fund
Governing
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Document or other document or relationship between Tamco and any Person
making up Fund VI, Tamco will exercise the same care that it exercises in
the administration or handling of transactions for its own account.
(b) Definitions. As used in this Section 6.10:
"Fund Governing Documents" means all documents and instruments
(other than the Production Payment Documents) under which Tamco and
its Affiliates have undertaken to act for any of the TCW
Beneficiaries.
"Holders" means Fund VI and each of its successors or assigns at
any time owning an interest in the Production Payment.
"Requisite Holders" means, at any time, Fund VI or its successors
and assigns owning at least two-thirds of the total Percentage Shares
in the Production Payment previously held by Fund VI.
(h) Reliance by Grantor and SPS. GPF and Fund VI and each other Holder
agree that, prior to the delivery to Grantor or SPS of a notice of the
removal or termination of Tamco or TCW London (or any subsequent Funds
Agent) as Funds Agent as set forth below, Grantor or SPS, as the case may
be, shall: (i) be entitled to rely on Tamco's (or any successor Funds
Agent's) authority to act on behalf of Fund VI and on TCW London's (or any
subsequent Funds Agent's) authority to act on behalf of GPF in all dealings
with Tamco or TCW London (or any such subsequent Funds Agent) with respect
to the Production Payment Documents; (ii) be protected in relying on
actions, communications, notices and terminations relating thereto or
required or permitted thereunder by Funds Agent; and (iii) discharge its
obligations under this Agreement and the Production Payment Documents by
delivering payments, notices and other information to Funds Agent or to
such bank accounts and addresses as Funds Agent may from time to time
specify. In the event of the removal of Funds Agent and the appointment of
a successor Funds Agent, neither Grantor nor SPS shall be required to
recognize any such removal or appointment unless and until it shall have
received a writing setting forth such removal and appointment executed by
the Person or Person's from whom the removed Funds Agent was acting, as
well as the acceptance of such appointment by such successor Funds Agent,
and Grantor and SPS shall be entitled to rely on such writing as being
genuine and what it purports to be without any necessity of any
investigation whatsoever.
(i) ACKNOWLEDGMENT, WAIVER AND RELEASE BY GRANTOR AND SPS. GRANTOR AND
SPS HAVE BEEN INFORMED, AND HEREBY ACKNOWLEDGE AND AGREE, THAT ALL ACTS BY
TAMCO AND TCW LONDON AS FUNDS AGENT IN CONNECTION WITH THE PRODUCTION
PAYMENT DOCUMENTS ARE DONE ON BEHALF OF GPF AND FUND VI AND THE TCW
BENEFICIARIES, AND THAT TAMCO AND TCW LONDON AND THEIR AFFILIATES
(EXCLUDING GPF AND FUND VI)
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AND ITS AND THEIR SHAREHOLDERS, REPRESENTATIVES, TRUSTEES, AGENTS,
EMPLOYEES, OFFICERS, DIRECTORS, AND ATTORNEYS (COLLECTIVELY, THE "TCW
ENTITIES"), EXCLUDING GPF AND FUND VI, SHALL NOT BE PERSONALLY LIABLE TO
ANY PERSON (OTHER THAN THE TCW BENEFICIARIES) WITH RESPECT TO ANY ACTIONS
TAKEN (OR NOT TAKEN) BY TAMCO OR TCW LONDON IN THEIR CAPACITIES AS FUNDS
AGENT UNDER THIS AGREEMENT AND THE OTHER PRODUCTION PAYMENT DOCUMENTS. IN
FURTHERANCE OF THE FOREGOING, EACH OF GRANTOR AND SPS HEREBY WAIVES AND
RELEASES (FOR ITSELF AND ON BEHALF OF ITS SHAREHOLDERS, AFFILIATES,
REPRESENTATIVES, TRUSTEES, AGENTS, EMPLOYEES, OFFICERS, DIRECTORS, AND
ATTORNEYS) THE TCW ENTITIES FROM ANY AND ALL SUCH LIABILITIES. THIS
SUBSECTION (I) IN NO WAY (A) RELEASES OR DIMINISHES ANY LIABILITY THAT GPF
AND FUND VI MAY HAVE FOR ANY ACTION TAKEN (OR NOT TAKEN) BY TAMCO OR TCW
LONDON AS FUNDS AGENT OR (B) REDUCES OR DIMINISHES THE BENEFIT TO GPF AND
FUND VI OF ANY WAIVERS, RELEASES AND INDEMNITIES IN OTHER PROVISIONS OF THE
PRODUCTION PAYMENT DOCUMENTS THAT OTHERWISE BENEFIT GPF AND FUND VI."
Section 4. Notices. All notices, requests, consents, demands and other
communications which are required or permitted under any Production Payment
Document shall be given to GPF pursuant to Section 6.3 of the Original Purchase
Agreement at its address specified below:
TCW Global Project Fund Ltd.
c/o Conyers, Dill & Pearman
Clarendon House
Church Street
Hamilton, Bermuda
Attention: Kevin Butler
Telephone: 441/299-4993
Telecopy: 441/292-4720
with a copy to: TCW London International, Limited
865 South Figueroa
Los Angeles, California 90017
Attention: Arthur Carlson
Telephone: 213/244-0053
Telecopy: 213/244-0604
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Section 2.5. Closing. On the Current Closing Date, Grantor shall deliver
the Current Conveyance Supplement to Grantee, to take effect as and when
provided therein.
Section 2.6. Time and Place of Closing. The closing for the consummation of
the transactions contemplated herein shall take place on September 10, 2001 or
on such other date as may be agreed to by Grantor and Grantee (herein called the
"Current Closing Date").
Section 2.7. Winnie Guaranty. Grantor hereby confirms that GPF, as a
transferee and assign of SPS, is a "Guaranteed Party", as such term is defined
in the Winnie Guaranty, and the Winnie Guaranty shall apply to and inure to the
benefit of GPF.
ARTICLE III - Representations and Covenants
Section 3.1. Representations and Warranties of Grantor. To induce Grantee
to enter into the Current Supplement Documents, Grantor hereby represents and
warrants and covenants to Grantee that:
(a) All representations and warranties made by Grantor or any other
TransTexas Company in any Production Payment Document now or previously
delivered are true and correct as of the Current Closing Date (unless such
representations and warranties are expressly limited to an earlier date, in
which case such representations and warranties are true and correct as of such
earlier date), provided that the representations and warranties confirmed in the
Omnibus Certificates heretofore delivered are true and correct as such
Certificates are amended and updated through the date hereof. Without limitation
of the foregoing, no Senior Notes Event of Default exists.
(b) Each TransTexas Company has performed all agreements, covenants, and
conditions which it is required by any Production Payment Document to perform on
or prior to the Current Closing Date.
(c) The consummation on the Current Closing Date of the transactions
contemplated in the Current Supplement Documents: (i) is not prohibited by any
law or any regulation or order of any court or governmental agency or authority
applicable to Grantor or any other TransTexas Company, and (ii) does not subject
any of them to any penalty or other onerous condition under or pursuant to any
such law, regulation or order.
Section 3.2. Covenants. To induce Grantee to enter into the Current
Supplement Documents, Grantor hereby covenants with Grantee that Grantor will
perform all of its covenants and duties under the Production Payment Documents,
all as fully as if they were set out in full herein.
Section 3.3. Representations and Warranties of Grantee. Each Person
included within Grantee hereby represents and warrants to Grantor that: (a) such
Person has incurred no obligation or liability, contingent or otherwise, for
broker's or finder's fees in respect of any of the matters provided for in this
Supplement for which fees Grantor might be liable; (b) the Purchase
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Agreement constitutes the legal, valid and binding act and obligation of such
Person, enforceable against such Person in accordance with its terms except as
such enforcement may be limited by bankruptcy, insolvency, moratorium and other
similar laws applicable to creditors' rights generally or by general principles
of equity; (c) no bankruptcy or insolvency proceeding is presently pending (or,
to such Person's best knowledge, threatened) by or against such Person under any
applicable bankruptcy, insolvency or other similar law of any jurisdiction; (d)
such Person has not made a general assignment for the benefit of creditors; and
(e) such Person is acquiring the Production Payment for its own account and not
with any intention to transfer all or any part of the Production Payment to
others in violation of the Securities Act of 1933, as amended, or any other
applicable securities laws. Fund VI further represents and warrants that in
connection with the transactions contemplated herein and in the Purchase
Agreement (i) it is represented by Tamco, an investment manager that qualifies
as a "qualified professional asset manager" as defined in Department of Labor
Prohibited Transaction Exemption 84-14 (the "QPAM Exemption") and (ii) each of
the conditions of the QPAM Exemption are satisfied and will, throughout the term
of the Purchase Agreement (as hereby supplemented and amended), be satisfied.
ARTICLE IV - Miscellaneous
Section 4.1. Ratification of Production Payment Documents. The Original
Purchase Agreement as hereby supplemented and amended is hereby ratified and
confirmed in all respects. The other Production Payments Documents, as they may
be supplemented, amended or affected by the Current Supplement Documents, are
hereby ratified and confirmed in all respects. Any reference to the Purchase
Agreement in any Production Payment Document shall be deemed to refer to this
Supplement also, and any reference in any Production Payment Document to any
other document or instrument amended, renewed, extended or otherwise affected by
any Current Supplement Document shall also refer to such Current Supplement
Document. The execution, delivery and effectiveness of this Supplement and the
other Current Supplement Documents shall not, except as expressly provided
herein or therein, operate as a waiver of any right, power or remedy of Grantee
or Funds Agent under the Purchase Agreement or any other Production Payment
Document nor constitute a waiver of any provision of the Purchase Agreement or
any other Production Payment Document.
Section 4.2. Survival of Agreements. All representations, warranties,
covenants and agreements of Grantor herein shall survive the execution and
delivery of this Supplement and the other Current Supplement Documents and shall
further survive until terminated in accordance with the Purchase Agreement.
Section 4.3. Production Payment Documents. This Supplement and the other
Current Supplement Documents are Production Payment Documents, and all
provisions in the Purchase Agreement pertaining to Production Payment Documents
(including the arbitration provisions of Section 6.9 of the Purchase Agreement)
apply hereto and thereto.
THIS WRITTEN AGREEMENT AND THE OTHER PRODUCTION PAYMENT DOCUMENTS REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
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THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Section 4.4. Governing Law. This Supplement shall be deemed a contract and
instrument made under the laws of the State of Texas and shall be construed and
enforced in accordance with and governed by the laws of the State of Texas and
the laws of the United States of America, without regard to principles of
conflicts of law.
Section 4.5. Counterparts. This Supplement may be separately executed in
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed shall be deemed to constitute one and the same
Supplement.
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IN WITNESS WHEREOF, this Supplement is executed as of the date first
written above.
TRANSTEXAS GAS CORPORATION
By:
-------------------------------------
Simon Ward
Vice President and Treasurer
MIRANT AMERICAS ENERGY CAPITAL, LP
BY: Mirant Americas Development, Inc.,
its general partner
By:
---------------------------------
John A. Rigas
Attorney-in-Fact
TCW DR VI INVESTMENT PARTNERSHIP, L.P.
By: TCW ASSET MANAGEMENT COMPANY, as its
Agent
By:
---------------------------------
Kurt A. Talbot
Senior Vice President
TCW GLOBAL PROJECT FUND LTD.
By: TCW LONDON INTERNATIONAL, LIMITED, as
Investment Advisor
By:
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Randall S. Wade
Vice President
By:
---------------------------------
George R. Hutchinson
Managing Director
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TCW ASSET MANAGEMENT COMPANY, as Agent
By:
-------------------------------------
Kurt A. Talbot
Senior Vice President
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ACKNOWLEDGMENT
To induce Grantee to enter into the above Supplement, the undersigned
Galveston Bay Pipeline Company and Galveston Bay Processing Company each hereby
ratify and confirm their various agreements made in connection with the
Production Payment Documents referred to above and acknowledge and agree that
such agreements remain in full force and effect after taking into account the
Current Supplement Documents referred to above.
EXECUTED as of the date of the above supplement.
GALVESTON BAY PIPELINE COMPANY
By:
-------------------------------
Simon Ward
Vice President and Treasurer
GALVESTON BAY PROCESSING COMPANY
By:
-------------------------------
Simon Ward
Vice President and Treasurer
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EXHIBIT A
PARTIAL CONVEYANCE OF PRODUCTION PAYMENT
AND
SEVENTH SUPPLEMENT TO PRODUCTION PAYMENT CONVEYANCE