Nut Tree Capital Management and Caspian Capital Send Letter Highlighting Grossly Conflicted Conflicts Committee of the Martin Midstream GP LLC Board of Directors

Nut Tree and Caspian Reiterate $4.00 per Common Unit Offer Representing 31% Premium to Alternate Offer Made by Martin Resource Management Corporation

Nut Tree and Caspian Call for Any Transaction with MRMC be Subject to Approval of Majority of Unaffiliated Common Unit Holders

NEW YORK, July 19, 2024 /PRNewswire/ -- Nut Tree Capital Management LP ("Nut Tree") and Caspian Capital LP ("Caspian"), today sent a letter to the Conflicts Committee of the Board of Directors (the "Conflicts Committee") of Martin Midstream GP LLC (the "General Partner") highlighting the serious conflicts of interest among the Conflicts Committee, General Partner, Martin Resource Management Corporation ("MRMC"), and Martin Midstream Partners L.P. (NASDAQ: MMLP) ("MMLP" or the "Partnership").

In the letter, Nut Tree and Caspian reiterate their fully-financed offer to acquire MMLP's common units for $4.00 per common unit in cash, which represents a 31% premium over MRMC'S offer, and urge the Conflicts Committee to act in the best interests of all MMLP common unit holders by requiring that any transaction with MRMC be subject to the approval of a majority of the unaffiliated common unit holders.  Moreover, Nut Tree and Caspian encourage all unaffiliated MMLP common unit holders to contact the General Partner's Board of Directors and management team to voice their opinions on the future of MMLP.

The full text of the letter is below:

July 19, 2024

Martin Midstream GP LLC
4200 Stone Road
Kilgore, Texas 75662
Attention: Byron Kelley, Chair of Conflicts Committee

Dear Members of the Conflicts Committee:

Nut Tree Capital Management LP ("Nut Tree") and Caspian Capital LP ("Caspian"), on behalf of certain funds and co-investors each advises or manages, are writing to the Conflicts Committee of the Board of Directors (the "Conflicts Committee") of Martin Midstream GP LLC (the "General Partner") to express our dismay with the Conflicts Committee's response, or lack thereof, to our July 11, 2024 letter.

It is our belief that the Conflicts Committee, which was formed to address conflicts of interest among Martin Resource Management Corporation ("MRMC"), the General Partner, and Martin Midstream Partners L.P. ("MMLP" or the "Partnership"), has brought into question its willingness to act in the best interests of MMLP common unit holders.

As you know, MRMC made an offer to purchase MMLP for $3.05 per common unit in a related-party transaction: the General Partner is wholly owned and controlled by MRMC and its subsidiaries, and Ruben Martin, III serves as Chairman of the Board of Directors of the General Partner and the President, Chief Executive Officer, and Chairman of the Board of Directors of MRMC.  The Conflicts Committee reviewing MRMC's offer is comprised of Byron Kelley (Chairman), James M. Collingsworth and C. Scott Massey, who have served with Mr. Martin on the General Partner's Board of Directors for approximately 12 years, 10 years and 22 years, respectively. The actions of the Conflicts Committee indicate to us that its members are too beholden to Mr. Martin to protect the interests of MMLP's common unit holders. 

How else are we to explain the Conflicts Committee's insistence that it would not engage in any way with us unless MRMC, as the owner of the General Partner, were to support our competing proposal to purchase MMLP's common units for $4.00 per common unit in cash?  In a letter sent July 15, 2024, Mr. Kelley informed us that the "Conflicts Committee has no authority or ability to discuss the sale of the General Partner".  Let us be clear – the Conflicts Committee should be focused on the potential value flowing to MMLP unitholders under our proposal, and our views on valuation.  However, instead of seeking to become fully informed as to the value of MMLP's common units by engaging with us, the Conflicts Committee appears to be isolating itself, and in doing so jeopardizes the integrity of its process, to the detriment of the unaffiliated unitholders.

Nut Tree and Caspian's all-cash fully-financed offer represents a significant, 31% premium over the common unit offer made by MRMC, and has the potential to increase if allowed to conduct confirmatory due diligence. A refusal by the Conflicts Committee to engage with us is antithetical to the best interests of MMLP unit holders. The Conflicts Committee's actions have brought into question its willingness to run a fair process to drive value for MMLP common unit holders.

This is easily remedied. 

The Conflicts Committee knows full and well that the General Partner, MRMC, Mr. Martin and their affiliates control a significant portion of MMLP's common units and therefore will heavily influence the outcome of a vote on any transaction. If the Conflicts Committee is seeking to oversee a truly fair and impartial sale process, it should require that any transaction with MRMC be made subject to the approval of a majority of the unaffiliated common unit holders (i.e. excluding the units held by MRMC, the General Partner, Mr. Martin, or any of their affiliates), rather than merely a majority of the outstanding common unit holders.  This simple fix, which should have been instituted in the first place, will allow MMLP common unit holders to have a true say on MRMC's highly conflicted offer and the future of their investment in MMLP.

We encourage all unaffiliated MMLP common unit holders to reach out to the General Partner's Board of Directors and management team to voice their opinions on the future of MMLP.

As stated, we reiterate our offer to purchase MMLP's common units for $4.00 per common unit in cash and stand ready to enter into an appropriate confidentiality agreement and commence our diligence immediately and on an expedited basis.

We look forward to your prompt response.

Sincerely,

Latham & Watkins LLP and Olshan Frome Wolosky LLP are serving as legal counsel to Nut Tree and Caspian.

About Caspian Capital LP
Caspian Capital LP, founded in 1997, is focused on performing, stressed, distressed corporate credit, and value equities. Caspian currently oversees $4 billion in assets under management.

About Nut Tree Capital Management LP
Nut Tree Capital, founded in 2015, implements a fundamentals-based strategy focused on distressed credit, stressed/event-driven credit and value equities. Nut Tree currently oversees $4 billion in assets.

Media Contacts: 
Jonathan Gasthalter/Nathaniel Garnick
Gasthalter & Co.
(212) 257-4170

SOURCE Nut Tree Capital Management and Caspian Capital

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