UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of Report (Date of earliest event reported): April 22,
2003 (April 15, 2003)
Commission File Number: 000-32855
TORCH OFFSHORE, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 74-2982117
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
401 Whitney Avenue, Suite 400
Gretna, Louisiana 70056-2596
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code:
(504)367-7030
ITEM 5. OTHER EVENTS AND REQUIRED FD DISCLOSURE.
On April 15, 2003, Torch Offshore, Inc. (the "Company")
issued a press release announcing that substantially all of
the conditions required for the conversion contract for the
conversion of the Midnight Express, entered into with Davie
Maritime Inc. of Quebec, Canada, through its subsidiary,
Torch Express, L.L.C., to become effective have been
satisfied. The remaining conditions to be satisfied are the
closing of the Company's $60.0 million financing with
Regions Bank and Export Development Canada (EDC) to fund the
conversion of the Midnight Express and the issue by
Investissement Quebec of the required performance bond. The
Company expects that these conditions will be satisfied
soon.
A copy of the Company's press release announcing the above
is filed as an exhibit to this Form 8-K and is incorporated
herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL
INFORMATION AND EXHIBITS.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
The following exhibits are filed herewith:
Exhibit No. Description
99.1 Press release dated April 15, 2003.
99.2 First Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.3 Second Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.4 Third Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.5 Fourth Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as Builder,
and Torch Express L.L.C., as Owner
99.6 Fifth Amendment to the Conversion Contract made as of
December 3, 2002 between Davie Maritime, Inc. a company
organized and existing under the laws of Canada, and Torch
Express L.L.C., a company organized and existing under the
laws of Louisiana
99.7 Parent Company Guarantee to Davie Maritime Inc. from
Torch Offshore, Inc.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
TORCH OFFSHORE, INC.
By: /s/ ROBERT E. FULTON
Date: April 22, 2003 -------------------------
Robert E. Fulton
Chief Financial Officer
INDEX TO EXHIBITS
Exhibit No. Description
99.1 Press release dated April 15, 2003.
99.2 First Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.3 Second Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.4 Third Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as
Builder, and Torch Express L.L.C., as Owner
99.5 Fourth Amendment to the Conversion Contract dated
December 3, 2002 between Davie Maritime, Inc. as Builder,
and Torch Express L.L.C., as Owner
99.6 Fifth Amendment to the Conversion Contract made as of
December 3, 2002 between Davie Maritime, Inc. a company
organized and existing under the laws of Canada, and Torch
Express L.L.C., a company organized and existing under the
laws of Louisiana
99.7 Parent Company Guarantee to Davie Maritime Inc. from
Torch Offshore, Inc.
EXHIBIT 99.1
NEWS RELEASE
For immediate release to: Contact: Bob Fulton (1) 504-367-7030
Analysts, Financial Community, Media b.fulton@torchinc.com
Bradley Lowe(1)504-367-7030
b.lowe@torchinc.com
Torch Offshore - Midnight Express Conversion Contract
New Orleans, Louisiana USA, April 15, 2003
Torch Offshore, Inc. (NASDAQ: TORC) (the "Company")
announced today that all of the conditions of the contract
for the conversion of the Midnight Express, entered into
with Davie Maritime Inc. (the "Shipyard") of Quebec, Canada,
through its subsidiary, Torch Express L.L.C., to become
unconditionally effective have been satisfied except for the
closing of the Company's $60.0 million financing with
Regions Bank and Export Development Canada (EDC) to fund the
conversion of the Midnight Express and the issue by
Investissement Quebec of the required performance bond,
expected to occur soon.
The total value of the conversion contract with the Shipyard
is approximately $37.0 million, which represents a major
portion of the expected cost to convert the vessel to a DP-2
offshore pipelay and construction vessel with a total cost
of approximately $90.0 million. The vessel is expected to be
delivered to the Company's active fleet in the first quarter
of 2004, after sea trials. The Company has incurred
approximately $31.0 million of costs associated with the
conversion through March 31, 2003.
Lyle G. Stockstill, Torch Offshore, Inc. Chairman and Chief
Executive Officer, commented, "The progress made to date
shows the Company's commitment to our expansion into the
deepwater and our confidence in Davie Maritime Inc. The
Midnight Express has been drydocked at the Davie Maritime
Inc. shipyard and we have continued to move forward with our
third party suppliers of various aspects of the conversion,
including the construction of our patent-pending pipelay
system. In addition, we continue to work closely with
Regions Bank and EDC to finalize the finance portion of the
conversion."
Established in 1978, Torch Offshore, Inc. is involved in
offshore pipeline installation and subsea construction for
the oil and natural gas industry. Torch Offshore, Inc. is
expanding beyond its established shallow water niche market
in order to serve the industry's worldwide growing needs in
the deep waters.
Any statements made in this news release, other than those
of historical fact, about an action, event or development,
which the Company hopes, expects, believes or anticipates
may or will occur in the future, are forward-looking
statements under the Private Securities Litigation Act of
1995. The forward-looking statements in this news release
include statements about the modification and/or conversion
timing and cost of the Midnight Express, the capabilities of
the Midnight Express, the Company's ability to use its
capital resources for the conversion of the Midnight
Express, and the timing for completion of the conversion
financing. Such statements are subject to various
assumptions, risks and uncertainties, which are specifically
described in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2002 filed with the
Securities and Exchange Commission, as well as other factors
that may not be within the Company's control, including,
specifically, oil and natural gas commodity prices, weather
conditions and offshore construction activity levels.
Although the Company believes its expectations are based on
reasonable assumptions, it gives no assurance that the
Company's assumptions and projections will prove to be
correct. Actual results may differ materially from those
projected.
EXHIBIT 99.2
FIRST AMENDMENT TO THE CONVERSION CONTRACT dated December 3,
2002 between DAVIE MARITIME, INC., as Builder, and TORCH
EXPRESS L.L.C., as Owner
WHEREAS:
A. Article 29.4 provides that the Conversion Contract
will become null and void at the expiry of 90 days
after its date of execution unless by such date
specified conditions have been either satisfied or
waived; and
B. The parties wish to extend such date.
WITNESSETH that the parties have agreed as follows:
1. The figure "90" where it appears in Article 29.4
of the Contract is hereby deleted and replaced
with the figure "106".
2. The Contract is in all other respects is hereby
confirmed.
IN WITNESS WHEREOF the parties have caused this First
Amendment to the Contract to be signed by their duly
authorized signatories as of March 3, 2003.
DAVIE MARITIME INC.
By: /s/ Richard Bertrand
------------------------
Richard Bertrand
TORCH EXPRESS L.L.C.
By: /s/ Lyle Stockstill
------------------------
Lyle Stockstill
EXHIBIT 99.3
SECOND AMENDMENT TO THE CONVERSION CONTRACT dated December
3, 2002 between DAVIE MARITIME, INC., as Builder, and TORCH
EXPRESS L.L.C., as Owner
WHEREAS:
A. Article 29.4 as amended provides that it will
become null and void at the expiry of 106 days
after its date of execution unless by such date
specified conditions have been either satisfied or
waived; and
B. The parties wish to extend such expiry date
further.
WITNESSETH that the parties have agreed as follows:
1. The figure "106" where it appears in Article 29.4
of the Contract as amended is hereby deleted and
replaced with the figure "111".
2. The Contract is in all other respects hereby
confirmed.
IN WITNESS WHEREOF the parties have caused this Second
Amendment to the Contract to be signed by their duly
authorized signatories as of March 19, 2003.
DAVIE MARITIME INC.
By: /s/ Richard Bertrand
------------------------
Richard Bertrand
TORCH EXPRESS L.L.C.
By: /s/ Lyle Stockstill
------------------------
Lyle Stockstill
EXHIBIT 99.4
THIRD AMENDMENT TO THE CONVERSION CONTRACT dated December 3,
2002 between DAVIE MARITIME, INC., as Builder, and TORCH
EXPRESS L.L.C., as Owner
WHEREAS:
A. Article 29.4 as amended provides that it will
become null and void at the expiry of 111 days
after its date of execution unless by such date
specified conditions have been either satisfied or
waived; and
B. The parties wish to extend such expiry date
further.
WITNESSETH that the parties have agreed as follows:
1. The figure "111" where it appears in Article 29.4
of the Contract as amended is hereby deleted and
replaced with the figure "120".
2. The Contract is in all other respects hereby
confirmed.
IN WITNESS WHEREOF the parties have caused this Second
Amendment to the Contract to be signed by their duly
authorized signatories as of March 24, 2003.
DAVIE MARITIME INC.
By: /s/ Richard Bertrand
------------------------
Richard Bertrand
TORCH EXPRESS L.L.C.
By: /s/ Lyle Stockstill
------------------------
Lyle Stockstill
EXHIBIT 99.5
FOURTH AMENDMENT TO THE CONVERSION CONTRACT dated December
3, 2002 between DAVIE MARITIME, INC., as Builder, and TORCH
EXPRESS L.L.C., as Owner
WHEREAS:
A. Article 29.4 as amended provides that it will
become null and void at the expiry of 120 days
after its date of execution unless by such date
specified conditions have been either satisfied or
waived; and
B. The parties wish to extend such expiry date
further.
WITNESSETH that the parties have agreed as follows:
1. The figure "120" where it appears in Article 29.4
of the Contract as amended is hereby deleted and
replaced with the figure "128".
2. The Contract is in all other respects hereby
confirmed.
IN WITNESS WHEREOF the parties have caused this Second
Amendment to the Contract to be signed by their duly
authorized signatories as of April 2, 2003.
DAVIE MARITIME INC.
By: /s/ Richard Bertrand
------------------------
Richard Bertrand
TORCH EXPRESS L.L.C.
By: /s/ Lyle Stockstill
------------------------
Lyle Stockstill
EXHIBIT 99.6
FIFTH AMENDMENT TO THE CONVERSION CONTRACT made as of
December 3, 2002 between DAVIE MARITIME INC., a company
organized and existing under the laws of Canada whose
registered office address is 22 George D. Davie Rd., Levis,
Quebec G6V 8V5 in the city and judicial district of Quebec,
Province of Quebec, represented by Mr. Richard Bertrand,
duly authorized to act hereunder, as he so states (the
"Builder"), and TORCH EXPRESS L.L.C., a company organized
and existing under the laws of Louisiana whose registered
office address is 401 Whitney Ave., Gretna, LA 70056 USA.
(the "Owner").
WHEREAS:
1. Builder and Owner are parties to a Conversion
Contract dated December 3, 2002 which was amended effective
March 3, 19, 24 and April 2, 2003.
2. The parties wish to amend the Conversion Contract
as so amended (the "Amended Contract") as provided herein.
WITNESSETH that the Builder and Owner have agreed as
follows:
1. The definition of "Contractual Re-Delivery Date"
is hereby amended to read as follows: "Contractual Re-
Delivery Date" means the date which is 357 days after
January 3, 2003, as extended by the duration of any one or
more periods of Permissible Delay; provided that Owner shall
have authorized in writing the performance by Builder,
during the period commencing with the Contract Signing Date
(notwithstanding that the Contract shall not have become
effective), of that portion of the Work specified by Builder
in its letter to Owner dated November 27, 2003."
2. Article 6 of the Amended Contract is hereby
amended by adding at the end thereof the following:
"Each invoice delivered by Builder to
Owner shall include a certificate to be
signed by Builder's chief executive
officer or chief financial officer
addressed to Owner and the lenders
referred to in Article 4.6(a), in form
and substance satisfactory to Owner,
certifying to the effect that, except as
may be set forth therein, (a) Builder
has made full and timely payment for all
labour, services, materials and
equipment provided by employees,
suppliers, subcontractors, agents and
governments in connection with the Work
or the Ship (except amounts the payment
of which is being disputed in good faith
by Builder); and (b) to the best
knowledge and belief of the person
signing such certificate no employee,
supplier, subcontractor, agent or
government has filed any claim for a
Lien (as defined in Article 4.6(a))
against the Work or the Ship arising out
of the provision of any labour,
services, materials or equipment in
connection with the Work or the Ship.
Owner shall not be obligated to pay an
invoice unless it is accompanied by such
certificate."
3. Article 9.7 of the Amended Contract is hereby
deleted and replaced with the following:
"9.7 In the event that the date on which
Re-Delivery of the Ship takes place (the
"Actual Re-Delivery Date") occurs on or
before November 19, 2003 (as extended by
the duration of any one or more periods
of "Permissible Delay", the "Bonus Re-
Delivery Date"), Owner shall pay Builder
a daily bonus based on the number of
days by which the Actual Re-Delivery
Date is earlier than the Bonus Re-
Delivery Date less a grace period of
seven (7) days, determined as follows:
(a) if the Actual Re-Delivery Date
occurs within seven (7) and seventeen
(17) days before the Bonus Re-Delivery
Date, $12,500 for each day by which the
Actual Re-Delivery Date is earlier than
the Bonus Re-Delivery Date, and
(b) if the Actual Re-Delivery Date
occurs more than seventeen (17) but less
than thirty-one (31) days before the
Bonus Re-Delivery Date, $17,500 for each
day by which the Actual Re-Delivery Date
is earlier than the seventeenth (17th)
day before the Bonus Re-Delivery Date,
and
(c) if the Actual Re-Delivery Date
occurs more than thirty (30) days before
the Bonus Re-Delivery Date, $25,000 for
each day by which the Actual Re-Delivery
Date is earlier than the thirtieth
(30th) day before the Bonus Re-Delivery
Date;
provided, however, that the maximum
amount payable by Owner to Builder by
way of bonus under this Article 9.7
shall not exceed five per cent (5%) of
the Contract Price as amended from time
to time."
4. The following is hereby added as Article 9.8 of
the Amended Contract:
"9.8 Should ice formation on the
St. Lawrence Seaway, prevent the safe
operation of the Ship, the delays
incurred by the Builder to proceed with
the performance of Sea Trials or
preventing the departure of the Ship to
perform Sea Trials or its return after
Sea Trials, shall constitute a period of
Permissible Delay. In as much as ice
formation should only delay the safe
return of the Ship to the shipyard after
Sea Trials, the Owner may elect, once
the Sea Trials are completed, to have
the Remedial Work completed by the
Builder in facilities other than the
Yard. If such an election is made by
the Owner, all costs associated with the
Remedial Work which are in excess of the
cost for the Builder to complete the
Remedial Work at the shipyard, shall be
paid by the Owner. In the event the
Owner elects to have Remedial Work
completed by the Builder in facilities
other than the Yard may also elect to
take Re-Delivery of the Ship in the
alternative facilities as opposed to the
Yard as specified in Article 10.6 but
always subject to all other portions of
Article 10. "
5. Article 12.3(a) of the Amended Contract is hereby
amended by adding at the end thereof the following:
"All policies to be maintained by
Builder in accordance with Article
12.2(a) shall name Regions Bank, as
Agent, as additional insured as its
interests may appear."
6. Article 14 of the Amended Contract is hereby
amended by adding at the end thereof the following:
"It is also understood and agreed that:
(A) for the purposes of the
parenthetical wording in Article 14.3(a)
and the definition of Permissible Delay,
neither the taking of any action by
Samir or any other creditor of the Yard
or any related assets, nor any change in
the status of the Working Capital
Facility Guarantee shall constitute a
Force Majeure Event or Development; and
(B) the rights and remedies of Owner
under or pursuant to the Performance
Bond are without limitation of the
rights and remedies of Owner under or
pursuant to the Contract."
7. Article 15.1 of the Amended Contract is hereby
amended to add the following as the third sentence thereof:
"If Builder is in breach or default
under this Article 15.1 and if the
aggregate amount of such unpaid items is
more than $10,000, Owner shall, among
other things, have the right to deduct
the amount of any such unpaid items
(whether or not a Lien has been
asserted) from any payments due under
the Amended Contract. Such deduction
shall be valid until such time as, for
each unpaid item, Builder (a) gives
Owner an acquittance issued by any
suppliers, subcontractors and/or workmen
for such unpaid item in form and
substance reasonably acceptable to
Owner, (b) gives Owner further security
protecting Owner, in such form and
amount as Owner may reasonably require,
against any claims against the Ship or
the Owner that could be made by any
suppliers, subcontractors and/or workmen
for such unpaid item, or (c) establishes
to the reasonable satisfaction of Owner
that no claims against the Ship or the
Owner could be made by any suppliers,
subcontractors and/or workmen for such
unpaid item."
8. The Amended Contract is in all other respects
hereby confirmed.
IN WITNESS WHEREOF the parties have caused this Fifth
Amendment to the Contract to be signed by their duly
authorized signatories as of April 11, 2003.
DAVIE MARITIME INC.
By: /s/ Richard Bertrand
------------------------
Richard Bertrand
TORCH EXPRESS L.L.C.
By: /s/ Lyle Stockstill
------------------------
Lyle Stockstill
EXHIBIT 99.7
April 11, 2003
Davie Maritime Inc.
22 rue George D. Davie
Levis, Quebec G6V 8V5
Midnight Express Conversion Contract
Gentlemen:
We refer to the Midnight Express Conversion Contract (the
"Contract") dated December 3, 2002 made among you, as
builder (the "Builder"), and our wholly-owned subsidiary,
Torch Express L.L.C., as owner (the "Owner"), in respect of
the conversion of the "Midnight Express" into a dynamically
positioned pipe-laying vessel.
In consideration of your entry into the Contract, we hereby
irrevocably and unconditionally guarantee to you that Owner
will duly and punctually observe and perform all terms and
conditions contained in and discharge all obligations
required under the Contract.
This guarantee shall be a continuing guarantee and shall
remain in force and effect until all obligations of Owner
under the Contract have been fully and completely.
Furthermore, we hereby consent, subject to notification, to
any changes, extensions or adjustments of the Contract and
agree that no such changes, extensions or adjustments shall
discharge us from any liability herein in whole or in part.
We further represent, warrant and agree that:
(a) our obligations as guarantor shall, without limitation,
include the obligation to provide Owner with sufficient
funds to cure any default promptly following the giving
by you of any notice of default;
(b) our obligations hereunder shall not be affected by any
act, omission, matter or thing which might, but for this
provision, operate to release or otherwise exonerate from
our liabilities hereunder including without limitation:
(i) any time or waiver granted to Owner, or
(ii) any delay or omission on the part of yourselves in
exercising any rights, powers or remedies available
to you against Owner;
(c) as provided in Article 20.2 of the Contract, we shall
be a party to any arbitration conducted in accordance
with such Article and, whether or not we exercise our
right to participate in such arbitration, we shall be
bound, as guarantor, by any award of the arbitrators and
by the order of any court in Canada or the United States
which is issued for the purpose of enforcing such award;
and
(d) this Guarantee has been duly authorized by all
necessary corporate action and is our valid, binding
obligation enforceable in accordance with its terms.
This guarantee shall be governed by and construed in
accordance with the laws of the Province of Quebec and the
laws of Canada applicable thereto.
The Owner, the Builder and ourselves confirm that it is
their wish that this Guarantee, as well as any other
documents relating to this Guarantee, including notices and
demands, have been and shall be drawn up in the English
language only. Les parties aux presentes confirment leur
volonte que cette convention, de meme que tous les
documents, y compris tous avis et demandes, soient rediges
en anglais seulement.
Any notice hereunder shall be sent by post or fax (confirmed
by registered mail) to ourselves at the address and fax
number set out above.
TORCH OFFSHORE INC
/s/ Lyle G. Stockstill
-------------------------
Lyle G. Stockstill, Chairman of the Board of Directors