EXHIBIT 4.1
EXECUTION VERSION
U.S. $800,000,000
CREDIT AGREEMENT
DATED AS OF
JULY 7, 2004
AMONG
PRIDE OFFSHORE, INC.
AS BORROWER
AND
THE GUARANTORS NAMED HEREIN
AS GUARANTORS
AND
THE LENDERS NAMED HEREIN
AS REVOLVING LENDERS
AND
THE LENDERS NAMED HEREIN
AS TERM LENDERS
AND
CITICORP NORTH AMERICA, INC.
AS ADMINISTRATIVE AGENT
AND
CALYON NEW YORK BRANCH AND NATEXIS BANQUES POPULAIRES
AS ISSUING BANKS
AND
CALYON NEW YORK BRANCH AND NATEXIS BANQUES POPULAIRES
AS SWINGLINE LENDERS
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SOLE LEAD ARRANGER AND SOLE BOOK RUNNER:
CITIGROUP GLOBAL MARKETS INC.
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms.......................................................... 1
Section 1.02. Computation of Time Periods.................................................... 26
Section 1.03. Accounting Terms............................................................... 26
Section 1.04. Miscellaneous.................................................................. 26
ARTICLE II
AMOUNT AND TERMS OF THE ADVANCES AND LETTERS OF CREDIT
Section 2.01. The Advances................................................................... 26
Section 2.02. Making the Advances............................................................ 28
Section 2.03. Fees........................................................................... 29
Section 2.04. Mandatory Repayments........................................................... 29
Section 2.05. Interest....................................................................... 31
Section 2.06. Additional Interest on LIBOR Advances.......................................... 32
Section 2.07. Interest Rate Determination and Protection..................................... 32
Section 2.08. Conversion of Advances; Continuation........................................... 33
Section 2.09. Optional Prepayments........................................................... 33
Section 2.10. Increased Costs; Capital Adequacy, Etc......................................... 34
Section 2.11. Illegality..................................................................... 34
Section 2.12. Payments and Computations...................................................... 35
Section 2.13. Taxes.......................................................................... 36
Section 2.14. Sharing of Payments, Etc....................................................... 38
Section 2.15. Ratable Reduction or Termination of the Commitments; Effect of Termination..... 38
Section 2.16. Replacement of Lender.......................................................... 38
Section 2.17. Certificates of Lenders........................................................ 39
Section 2.18. Letters of Credit.............................................................. 39
ARTICLE III
CONDITIONS
Section 3.01. Initial Conditions Precedent................................................... 41
Section 3.02. Additional Conditions Precedent to Each Advance................................ 44
Section 3.03. Conditions Precedent to Each Letter of Credit.................................. 44
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties................................................. 45
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants.......................................................... 49
Section 5.02. Negative Covenants............................................................. 54
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TABLE OF CONTENTS
(continued)
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01. Events of Default.............................................................. 62
Section 6.02. L/C Cash Collateral Accounts................................................... 64
ARTICLE VII
THE ADMINISTRATIVE AGENT AND THE ISSUING BANKS
Section 7.01. Authorization and Action....................................................... 65
Section 7.02. Administrative Agent's Reliance, Etc........................................... 66
Section 7.03. Administrative Agent and Its Affiliates........................................ 67
Section 7.04. Lender Credit Decision......................................................... 67
Section 7.05. Certain Rights of the Administrative Agent..................................... 67
Section 7.06. Holders........................................................................ 67
Section 7.07. Indemnification................................................................ 67
Section 7.08. Resignation by the Administrative Agent........................................ 68
Section 7.09. Issuing Banks' Reliance, Etc................................................... 68
Section 7.10. Issuing Banks and Their Affiliates............................................. 69
Section 7.11. Lender Credit Decision......................................................... 69
ARTICLE VIII
THE GUARANTY
Section 8.01. Guaranty....................................................................... 69
Section 8.02. Limit of Liability............................................................. 70
Section 8.03. Guaranty Absolute.............................................................. 70
Section 8.04. Waiver of Notice and Other Remedies............................................ 71
Section 8.05. Waiver of Subrogation and Contribution......................................... 71
Section 8.06. Reinstatement.................................................................. 71
Section 8.07. Exercise of Remedies........................................................... 72
Section 8.08. Modifications and Amendment to the Credit Documents............................ 72
Section 8.09. Representations, Warranties and Covenants...................................... 72
Section 8.10. Continuing Guaranty; Assignments............................................... 72
Section 8.11. No Guarantee of Indenture Issuer Obligations................................... 72
Section 8.12. Parallel Obligations........................................................... 72
ARTICLE IX
THE COLLATERAL AGENT
Section 9.01. Authorization and Action....................................................... 72
Section 9.02. Collateral Agent's Reliance, Etc............................................... 73
Section 9.03. Collateral Agent and Its Affiliates............................................ 73
Section 9.04. Lender Credit Decision......................................................... 73
Section 9.05. Certain Rights of the Collateral Agent......................................... 74
Section 9.06. Holders........................................................................ 74
Section 9.07. Indemnification................................................................ 74
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TABLE OF CONTENTS
(continued)
Section 9.08. Resignation by the Collateral Agent............................................ 75
ARTICLE X
MISCELLANEOUS
Section 10.01. Amendments, Etc................................................................ 75
Section 10.02. Notices, Etc................................................................... 76
Section 10.03. No Waiver; Remedies............................................................ 79
Section 10.04. Costs, Expenses and Indemnity.................................................. 79
Section 10.05. Right of Set-Off............................................................... 80
Section 10.06. Assignments and Participations................................................. 80
Section 10.07. Governing Law; Entire Agreement................................................ 84
Section 10.08. Interest....................................................................... 84
Section 10.09. Confidentiality................................................................ 84
Section 10.10. Execution in Counterparts...................................................... 85
Section 10.11. Domicile of Loans.............................................................. 85
Section 10.12. Binding Effect................................................................. 85
Section 10.13. Waiver of Jury Trial........................................................... 85
Section 10.14. Severability................................................................... 85
Section 10.15. Forum Selection and Consent to Jurisdiction.................................... 85
Section 10.16. Damages........................................................................ 86
Section 10.17. Patriot Act Notice............................................................. 86
Section 10.18. Survival of Agreements, Representations and Warranties, Etc.................... 86
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TABLE OF CONTENTS
(continued)
Schedule I Applicable Lending Offices
Schedule 2.18(g) Existing Letters of Credit
Exhibit A-1 Form of Revolving Note
Exhibit A-2 Form of Term Note
Exhibit A-3 Form of Swingline Note
Exhibit B-1 Form of Notice of Borrowing
Exhibit B-2 Form of Notice of Letter of Credit
Exhibit C Form of Opinion of ▇▇▇▇▇ ▇▇▇▇▇ L.L.P., Counsel to the Credit Parties
Exhibit D Form of Opinion of the General Counsel of the Parent
Exhibit E Form of Opinion of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P., Counsel to the Administrative Agent
Exhibit F Form of Opinion of Holland & Knight LLP, Counsel to the Administrative Agent
Exhibit G Form of Transfer Agreement
Exhibit H Form of Security Agreement
Exhibit I-1 Form of Pledge Agreement (Delaware)
Exhibit I-2 Form of Pledge Agreement (BVI)
Exhibit I-3 Form of Pledge Agreement (Dutch)
Exhibit J Reserved
Exhibit K Initial Rigs
Exhibit L Reserved
Exhibit M Opco Loan Collateral
Exhibit N Existing Liens
Exhibit O Existing Debt
Exhibit P-1 Form of Vessel Mortgages
Exhibit P-2 Form of Assignment of Insurances
Exhibit P-3 Master Vessel and Trust Agreement
Exhibit Q Form of Guarantor Joinder Agreement
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CREDIT AGREEMENT
Dated as of July 7, 2004
PRIDE OFFSHORE, INC., a Delaware corporation, the Guarantors, the
lenders party hereto, Calyon New York Branch and Natexis Banques Populaires, as
Issuing Banks, Calyon New York Branch and Natexis Banques Populaires, as
Swingline Lenders, Citicorp North America, Inc., as Administrative Agent, and
Citibank, N. A., as Collateral Agent, agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and the plural forms of the terms defined):
"Acceptable Security Interest" in any property shall mean a Lien
granted pursuant to a Credit Document (i) which exists in favor of the
Collateral Agent or the Collateral Trustee for the benefit of itself, the
Issuing Banks, the Swingline Lenders, the holders of the Other Obligations, the
Administrative Agent and the Lenders, (ii) which is superior to all other Liens,
(iii) which secures all Obligations, and (iv) which is perfected and is
enforceable by the Collateral Agent or the Collateral Trustee, for the benefit
of itself, the Issuing Banks, the Swingline Lenders, the holders of the Other
Obligations, the Administrative Agent and the Lenders, against all other Persons
in preference to any rights of any such other Person therein; provided that such
Lien may be subject to the Collateral Permitted Liens.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Parent or any of its Subsidiaries acquires any offshore drilling rig or vessel,
or fleet of rigs or vessels, or any other asset (including Equity Interests),
whether through the purchase of assets, merger or otherwise.
"Additional Security Documents" has the meaning specified in Section
5.01(l).
"Adjusted Net Assets" means, as to each Guarantor, at any date, the
amount by which the Fair Value of the assets of such Guarantor exceeds the total
amount of its liabilities, including contingent liabilities (after giving effect
to all other fixed and contingent liabilities incurred or assumed on such date),
but excluding liabilities under its guarantee hereunder at such date.
"Administrative Agent" means CNAI in its capacity as Administrative
Agent pursuant to Article VII and any successor in such capacity pursuant to
Section 7.08.
"Advance" means a Revolving Advance, a Swingline Advance or a Term
Advance.
"Affected Lender" has the meaning specified in Section 2.11.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person. The term "controls" (including the
terms "controlled by" or "under common control with") includes the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of Equity
Interests, by contract or otherwise.
"Agreement" means this Credit Agreement, as amended, supplemented or
modified from time to time.
"Applicable Base Rate Margin for Revolving Advances", "Applicable Base
Rate Margin for Term Advances", "Applicable LIBOR Margin for Revolving
Advances", "Applicable LIBOR Margin for Term Advances", "Applicable Letter of
Credit Rate" and "Applicable Commitment Fee Rate" mean, for any day, with
respect to any Base Rate Advance, LIBOR Advance, Letter of Credit or commitment
fees payable hereunder, as the case may be, the applicable rate per annum set
forth below under the caption "Applicable Base Rate Margin for Revolving
Advances", "Applicable LIBOR Margin for Revolving Advances", "Applicable Base
Rate Margin for Term Advances", "Applicable LIBOR Margin for Term Advances",
"Applicable Letter of Credit Rate" or "Applicable Commitment Fee Rate", as the
case may be, based upon the Applicable Leverage Ratio for such day:
Applicable Applicable Applicable Applicable
Base Rate LIBOR Base Rate LIBOR
Margin for Margin for Margin for Margin for Applicable Applicable
Applicable Revolving Revolving Term Term Letter of Commitment
Leverage Ratio: Advances Advances Advances Advances Credit Rate Fee Rate
--------------------- ---------- ---------- ---------- ---------- ----------- ----------
> or = 5.00 to 1.00 1.50% 2.50% 1.50% 1.75% 2.50% 0.625%
< 5.00 to 1.00 and 1.00% 2.00% 1.00% 1.75% 2.00% 0.50%
> or = 4.50 to 1.00
< 4.50 to 1.00 and 0.75% 1.75% 1.00% 1.75% 1.75% 0.375%
> or = 4.00 to 1.00
< 4.00 to 1.00 and 0.50% 1.50% 1.00% 1.75% 1.50% 0.375%
> or = 3.50 to 1.00
< 3.50 to 1.00 and 0.25% 1.25% 0.75% 1.75% 1.25% 0.375%
> or = 3.00 to 1.00
< 3.00 to 1.00 0 1.00% 0.75% 1.75% 1.00% 0.25%
"Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of a Base Rate Advance and such
Lender's Eurodollar Lending Office in the case of a LIBOR Advance.
"Applicable Leverage Period" means each period commencing on and
including the date when financial statements are delivered by the Parent
pursuant to Section 5.01(a)(i) or (ii), as applicable, and ending on but
excluding the next date when financial statements are delivered by the Parent
pursuant to Section 5.01(a)(i) or (ii), as applicable.
"Applicable Leverage Ratio" shall mean, for any day during an
Applicable Leverage Period, the Leverage Ratio as of the end of the fiscal
quarter of the Parent most recently ended prior to the first day of such
Applicable Leverage Period; provided that the Applicable Leverage Ratio for any
day prior to the first date financial statements are delivered pursuant to
Section 5.01(a)(i) or (ii), shall be deemed to be 4.00 to 1.00.
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"Approved Fund" means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course and
that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or
(c) an entity or an Affiliate of an entity that administers or manages a Lender.
"Asset Disposition" means (i) any Land Rig Disposition, and (ii) any
sale, lease, transfer or other disposition (whether voluntary or involuntary,
but including any damage, destruction, loss or taking only to the extent it
results in the receipt by the Parent or any Subsidiary (other than an Excluded
Subsidiary (Mandatory Prepayment)) of total loss insurance payments and
condemnation proceeds that, in the aggregate, exceed $50,000,000 during the term
of this Agreement) of any asset of the Parent or any Subsidiary other than
sales, leases, transfers and other dispositions (a) in the ordinary course of
business, including charters in the ordinary course of business, but, for
avoidance of doubt, the sale, lease, transfer or other disposition of any rig
substantially as a whole (other than pursuant to a charter) or of any Equity
Interest in any Subsidiary is not in the ordinary course of business, (b) of the
Pride Illinois, Pride Kentucky, Pride West Virginia and/or Pride Pennsylvania,
(c) of assets (other than Collateral) during the term of this Agreement having
an aggregate Fair Market Value less than $25,000,000, (d) by a Project Finance
Subsidiary (unless the related project finance debt is repaid), (e) by an
Excluded Subsidiary (Mandatory Prepayment), (f) the Net Cash Proceeds of which
(or, in the case of any damage, destruction, loss or taking, those in excess of
$50,000,000) are (1) used to pay down the outstanding Revolving Advances (with
no required reduction in Revolving Commitments) or deposited into and held in a
segregated bank account and (2) reinvested in replacement assets within one year
of receipt, provided that if any rigs or Equity Interests that constitute
Collateral are transferred in connection with a disposition pursuant to this
clause (f), the Net Proceeds of such disposition and any replacement assets
shall be made subject to an Acceptable Security Interest, (g) between the Parent
and a Subsidiary or between Subsidiaries, provided that if any Collateral or
Opco Loan Collateral is transferred in connection with a disposition described
in this clause (g), the Parent or such Subsidiary of the Parent who owns the
Collateral or Opco Loan Collateral after such transfer shall ratify and confirm
the Lien on such Collateral or Opco Loan Collateral and shall take all action
reasonably requested by the Collateral Agent to maintain an Acceptable Security
Interest in the Collateral (except that, if any Included Foreign Pledge
Subsidiary ceases to exist or ceases to be an Included Foreign Pledge Subsidiary
as a part of such disposition, the security interest contemplated herein in the
Equity Interests of such Included Foreign Pledge Subsidiary may be terminated
simultaneously with the creation of an Acceptable Security Interest in the
percentage of the Equity Interests of all Included Foreign Pledge Subsidiaries
existing upon consummation of such disposition that is contemplated in the
definition of "Collateral") and to preserve the mortgages securing the Opco Loan
in all respects and (h) permitted by Section 5.02(o)(4)(iv).
"Bankruptcy Code" means Title 11 of the United States Code, as now or
hereafter in effect, or any successor thereto.
"Base Rate" means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time which rate per annum shall at all
times be equal to the highest of:
(a) the rate of interest announced publicly by Citibank
in New York, New York, from time to time, as Citibank's base rate; and
(b) the sum (adjusted to the nearest 1/4 of 1% or, if
there is no nearest 1/4 of 1%, to the next higher 1/4 of 1%) of (i) 1/2 of 1%
per annum plus (ii) the rate obtained by dividing (A) the latest three-week
moving average of secondary market morning offering rates in the United States
for three-month certificates of deposit of major United States money market
Lenders, such three-week moving average (adjusted to the basis of a year of 360
days) being determined weekly on each Monday (or, if such day is not a Business
Day, on the next succeeding Business Day) for the three-week period ending on
the
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previous Friday by Citibank on the basis of such rates reported by certificate
of deposit dealers to and published by the Federal Reserve Bank of New York or,
if such publication shall be suspended or terminated, on the basis of quotations
for such rates received by Citibank from three New York certificate of deposit
dealers of recognized standing selected by Citibank, by (B) a percentage equal
to 100% minus the average of the daily percentages specified during such
three-week period by the Federal Reserve Board for determining the maximum
reserve requirement (including, but not limited to, any emergency, supplemental
or other marginal reserve requirement) for Citibank with respect to liabilities
consisting of or including (among other liabilities) three-month Dollar
non-personal time deposits in the United States, plus (iii) the average during
such three-week period of the annual assessment rates estimated by Citibank for
determining the then current annual assessment payable by Citibank to the
Federal Deposit Insurance Corporation (or any successor) for insuring Dollar
deposits of Citibank in the United States; and
(c) the sum of 1/2 of one percent per annum plus the
Federal Funds Rate in effect from time to time.
"Base Rate Advance" means an Advance which bears interest as provided
in Section 2.05(a) (or, if Section 2.05(c) applies, that bears interest at 2%
per annum above the rate provided in Section 2.05(a)).
"Base Rate Revolving Advance" means a Base Rate Advance that is a
Revolving Advance.
"Base Rate Term Advance" means a Base Rate Advance that is a Term
Advance.
"Borrower" means Pride Offshore, Inc., a Delaware corporation.
"Borrowing" means a Revolving Borrowing, a Swingline Advance or a Term
Borrowing.
"Business Day" means (a) any day of the year except Saturday, Sunday
and any day on which Lenders are required or authorized to close in New York
City or Houston, Texas and (b) if the applicable Business Day relates to any
LIBOR Advances, any day which is a "Business Day" described in clause (a) and
which is also a day for trading by and between Lenders in the London interbank
Eurodollar market.
"Capital Expenditures" means any expenditure (other than in connection
with an Acquisition that is not made to maintain or improve an existing asset)
that, in accordance with GAAP, is required to be included in or reflected by the
property, plant and equipment account or any other fixed asset account in the
balance sheet of the Parent or any Subsidiary other than (i) expenditures for
which a customer of the Parent or a Subsidiary has agreed to reimburse the
Parent or such Subsidiary, as the case may be, directly or indirectly (whether
in the form of a lump sum payment, mobilization payment, progress payment, any
increase in the day rate for a rig or otherwise); and (ii) expenditures of
Casualty Proceeds.
"Capital Lease Obligations" means, with respect to any capital lease,
all lease obligations that under GAAP are required to be capitalized in respect
of such capital lease on the books of the lessee at the time of determination,
in each case taken at the amount thereof accounted for as indebtedness (net of
interest expense) in accordance with GAAP.
"Cash Equivalents" means (a) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or government of
a Participating Member State or issued by any agency thereof and backed by the
full faith and credit of the United States of America or a Participating Member
State, in each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Revolving Lender or by any
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commercial bank organized under the laws of the United States of America or any
state thereof or of any Participating Member State or any province or other
jurisdiction thereof having combined capital and surplus of not less than
$500,000,000 (or the equivalent in any other currency); (c) commercial paper of
an issuer rated at least A-2 by S&P or P-2 by ▇▇▇▇▇'▇, or carrying an equivalent
rating by a nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of commercial paper issuers generally, and
maturing within six months from the date of acquisition; (d) repurchase
obligations of any Revolving Lender or of any commercial bank satisfying the
requirements of clause (b) or (c) of this definition, having a term of not more
than 30 days with respect to securities issued or fully guaranteed or insured by
the United States government or government of a Participating Member State; (e)
securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth, territory, province or
other jurisdiction of the United States or any other foreign country, by any
political subdivision or taxing authority of any such state, commonwealth,
territory, province or other jurisdiction, the securities of which state,
commonwealth, territory, province, other jurisdiction, political subdivision or
taxing authority (as the case may be) are rated at least A by S&P or A by
▇▇▇▇▇'▇; (f) securities with maturities of six months or less from the date of
acquisition backed by standby letters of credit issued by any Revolving Lender
or any commercial bank satisfying the requirements of clause (b) or (c) of this
definition; and (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition.
"Casualty Event" means, with respect to any rig that is part of the
Collateral or secures the Opco Loan, (a) any loss or damage to, or any
condemnation or taking of, such rig other than a Total Loss of any rig for which
the Parent or any Subsidiary receives, anticipates recovering or has filed a
claim for Casualty Proceeds or (b) any Lien imposed by any governmental
authority pursuant to Environmental Law and that has not been released or bonded
within ten Business Days following the receipt by the Parent or any Subsidiary
of notice of such imposition unless such Lien is being contested in good faith
and by appropriate proceedings.
"Casualty Proceeds" means the proceeds of any insurance, condemnation
award or other compensation paid or payable to the Parent or any Subsidiary or
the Collateral Agent in respect of any Casualty Event, less the fees, taxes and
expenses paid to collect such proceeds.
"Change in Control" means (i) any Person or two or more Persons (other
than a Permitted Holding Company) acting in concert shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934), directly or
indirectly, of securities of the Parent (or other securities convertible into
such securities) representing 35% or more of the combined voting power of all
securities of the Parent entitled to vote in the election of directors, other
than securities having such power only by reason of the happening of a
contingency, or (ii) the first day on which a majority of the individuals who
constitute the board of directors of the Parent are not Continuing Directors, or
(iii) any Person or two or more Persons (other than a Permitted Holding Company)
acting in concert shall have acquired by contract or otherwise, or shall have
entered into a contract or arrangement which upon consummation will result in
its or their acquisition of, the power to exercise, directly or indirectly, a
controlling influence over the management or policies of the Parent.
"Citibank" means Citibank, N. A., a national banking association.
"CNAI" means Citicorp North America, Inc.
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"Code" means the Internal Revenue Code of 1986 as amended from time to
time, or any successor Federal tax code, and any reference to any statutory
provision of the Code shall be deemed to be a reference to any successor
provision or provisions.
"Collateral" means (i) all Equity Interests of the Borrower, whether
now owned or hereafter acquired, (ii) all Equity Interests of each Domestic
Subsidiary of the Borrower and of each Included (Full) Foreign Pledge Subsidiary
that are now owned or hereafter acquired by the Parent or any Subsidiary, (iii)
65% (or, if the Parent and the Subsidiaries now or hereafter own less than 65%,
then the percentage now or hereafter so owned) of all Equity Interests of each
Included (Partial) Foreign Pledge Subsidiary, (iv) the Initial Rigs, (v) all
rigs, insurance, receivables and inventory now owned or hereafter acquired by
the Borrower or any Domestic Subsidiary of the Borrower (other than Excluded
Subsidiaries (Collateral)), (vi) all other property covered by any Security
Document and (vii) any Liquid Securities in which an Acceptable Security
Interest is required to be created pursuant to Section 5.02(o)(4)(ii)(x)(b);
provided that neither the Collateral Account nor any Equity Interests in
Excluded Subsidiaries (Pledge) shall constitute Collateral; provided further
that any Collateral disposed of in accordance with Section 5.02(o) or otherwise
released from the Liens created by the Security Documents in accordance with
this Agreement or the Security Documents shall then cease to constitute
Collateral.
"Collateral Account" means an interest-bearing deposit account of the
Borrower (i) with the Collateral Agent or one of its Affiliates, (ii) over which
the Borrower has no control, and (iii) in which the Collateral Agent has a first
priority perfected security interest securing the relevant Obligations.
"Collateral Agent" means Citibank in its capacity as Collateral Agent
pursuant to Article IX and any successor in such capacity pursuant to Section
9.08.
"Collateral Permitted Liens" means non-consensual Liens permitted by
Section 5.02(c) to the extent not securing any obligation to the Parent or any
Subsidiary.
"Collateral Trustee" means Citibank and any successor in such capacity.
"Commitment" means any Revolving Commitment or any Term Commitment.
"Consolidated" refers to the consolidation of the accounts of the
Parent and its Subsidiaries in accordance with GAAP.
"Consolidated Current Liabilities" of any Person means, as of any date,
the total liabilities (including tax and other proper accruals) of such Person
and its subsidiaries (other than Non-Recourse Subsidiaries) on a consolidated
basis at such date which may properly be classified as current liabilities in
accordance with GAAP, after eliminating (1) all inter-company items between such
entity and its subsidiaries (other than Non-Recourse Subsidiaries) or between
subsidiaries (other than between a subsidiary that is not a Non-Recourse
Subsidiary and a Non-Recourse Subsidiary) and (2) all current maturities of
long-term Debt.
"Consolidated EBITDA" means, for any period, the sum, determined on a
Consolidated basis, of (i) revenues after operating costs and selling, general
and administrative expenses (but, for the avoidance of doubt, before taxes and
interest), plus (ii) to the extent included in such costs and expenses (a)
charges associated with the EPC Spar Contracts, (b) depreciation expense, (c)
amortization expense and (d) other non-cash expense, in each case of the Parent
and its Subsidiaries determined in accordance with GAAP for such period,
provided that, in making any determination of Consolidated EBITDA, pro forma
effect shall be given to each acquisition or disposition (or series of related
acquisitions or dispositions) that is reasonably expected to increase or
decrease Consolidated EBITDA by at least $2,000,000 during the
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twelve-month period following the date of such acquisition or disposition, as if
such acquisition or disposition had occurred one year prior to such date.
"Consolidated Interest Expense" means, for any period, the Consolidated
cash interest expense (excluding, for the avoidance of doubt, write-offs or
amortization of deferred financing costs) of the Parent and the Subsidiaries
determined in accordance with GAAP and as reflected in the financial statements
of the Parent and its Subsidiaries for such period, provided that, in making any
determination of Consolidated Interest Expense, pro forma effect shall be given
to each acquisition or disposition (or series of related acquisitions or
dispositions) that is reasonably expected to increase or decrease Consolidated
EBITDA by at least $2,000,000 during the twelve-month period following the date
of such acquisition or disposition, as if such acquisition or disposition had
occurred one year prior to such date.
"Consolidated Net Tangible Assets" of any Person means, as of any date,
Consolidated Tangible Assets of such Person at such date, after deducting
(without duplication of deductions) all Consolidated Current Liabilities of such
person at such date.
"Consolidated Tangible Assets" of any Person means, as of any date, the
consolidated assets of such person and its subsidiaries (other than Non-Recourse
Subsidiaries) at such date, after eliminating inter-company items and after
deducting (1) the net book value of all assets that would be classified as
intangibles under GAAP (including, without limitation, goodwill, organizational
expenses, trademarks, trade names, copyrights, patents, licenses and any rights
in any thereof) and (2) any prepaid expenses, deferred charges and unamortized
debt discount and expense, each such item determined in accordance with GAAP.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including any comfort letter, operating agreement, take-or-pay
contract or the obligations of any such Person as general partner of a
partnership with respect to the liabilities of the partnership.
"Continuing Director" means an individual who (a) is a member of the
full board of directors of the Parent and (b) either (i) was a member of the
board of directors of the Parent on the date hereof or (ii) whose nomination for
election or election to the board of directors of the Parent was approved by
vote of at least a majority of the directors then still in office who were
either directors on the date hereof or whose election or nomination for election
was previously so approved.
"Convert", "Conversion" and "Converted" each refers to a conversion of
Advances of one Type into Advances of another Type, as the case may be, pursuant
to Section 2.05(a), Section 2.07, Section 2.08, or Section 2.11.
"Credit Document" means this Agreement, each Note, each Security
Document, each Notice of Borrowing, each Notice of Letter of Credit, each Letter
of Credit and each other document or instrument executed and delivered in
connection with this Agreement.
"Credit Parties" means the Borrower and each Guarantor.
"Debt" means, in the case of any Person, to the extent reflected on the
balance sheet of such Person prepared in accordance with GAAP, (i) indebtedness
of such Person for borrowed money, (ii) obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (iii) obligations
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of such Person to pay the deferred purchase price of property or services
(other than accounts payable arising in the ordinary course of business and
payable on customary terms that are not more than 120 days past due), (iv)
obligations of such Person to deliver property or services for which prepayment
has been made, to the extent reflected as a liability pursuant to GAAP, (v)
monetary obligations of such Person as lessee under leases that are, in
accordance with GAAP, recorded as capital leases, (vi) all letters of credit
issued for the account of such Person or as to which such Person has any
reimbursement obligation, in each case securing an obligation for borrowed
money, whether or not drawn, (vii) obligations of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (viii) the aggregate liquidation value
of each Restricted Preferred Interest of such Person, (ix) obligations of such
Person under any synthetic lease, tax retention operating lease or off-balance
sheet loan or financing, (x) obligations of such Person under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, or otherwise to assure a creditor against loss in respect
of, and other Contingent Obligations in respect of, indebtedness or obligations
of others of the kinds referred to in clauses (i) through (ix) or clause (xii)
of this definition, (xi) indebtedness or obligations of others of the kinds
referred to in clauses (i) through (x) or clause (xii) of this definition
secured by any Lien on or in respect of any property of such Person, and (xii)
all liabilities of such Person in respect of unfunded vested benefits under any
Plan or Multiemployer Plan, except to the extent an ERISA Affiliate has paid
such liabilities within the time prescribed by law.
"Default" means an event which, with the giving of notice or lapse of
time or both, would constitute an Event of Default.
"Demand Loan" has the meaning specified in Section 2.18(c).
"Designating Bank" has the meaning specified in Section 10.06(g).
"Distribution" means any direct or indirect dividend, distribution or
other payment of any kind or character (whether in cash, securities or other
property and whether or not pursuant to a merger, consolidation or otherwise)
(i) in respect of any Equity Interest of the Parent or any Subsidiary or to the
holders, as such, of any Equity Interest of the Parent or any Subsidiary or (ii)
in consideration for or otherwise in connection with any retirement, purchase,
redemption or other acquisition of any Equity Interest of the Parent or any
Subsidiary.
"Dollars" and "$" means lawful money of the United States of America.
"Domestic Lending Office" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" opposite its name on
Schedule I hereto or in the Transfer Agreement pursuant to which it became a
Lender or such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent.
"Domestic Subsidiary" means any Subsidiary that is not a Foreign
Subsidiary.
"Dutch Deed of Pledge of Shares" means that certain Pledge Agreement
dated the date hereof executed by the Parent and Forasub and pledging 65% of the
Parent's Equity Interest in Forasub.
"Effective Date" has the meaning specified in Section 3.01.
"Eligible Assignee" means (i) any Lender, (ii) with respect to an
Eligible Assignee of Term Advances, an Approved Fund or other entity, (iii) with
the consent of the Issuing Banks and the
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Swingline Lenders (which consent will not be unreasonably withheld), any
Affiliate of any Lender, and (iv) with the consent of the Administrative Agent,
the Issuing Banks, the Swingline Lenders and, if no Event of Default has
occurred and is continuing, the Borrower (which consent will not be unreasonably
withheld), any other commercial bank or financial institution not covered by
clause (i), (ii) or (iii) of this definition; provided that (a) neither the
Parent nor any Subsidiary shall be an Eligible Assignee, and (b) (c) with
respect to clauses (iii) and (iv), the consent of the Issuing Banks and the
Swingline Lenders shall not be required for purposes of determining an Eligible
Assignee of Term Advances.
"Environment" shall have the meaning set forth in 42 U.S.C. Section
9601(8) as defined on the date of this Agreement, and "Environmental" means
pertaining or relating to the Environment.
"Environmental Law" means any law, statute, ordinance, rule,
regulation, order, decision, decree, judgment, permit, license, authorization or
other agreement or Governmental Requirement arising from, in connection with or
relating to the pollution, protection or regulation of the Environment or the
protection or regulation of health or safety, whether the foregoing are required
or promulgated by any government or agency or other authority of or in the
United States (whether local, state, or federal) or any foreign country or
subdivision thereof, including those relating to the disposal, removal,
remediation, production, storing, refining, handling, transferring, processing,
recycling or transporting of or exposure to any material or substance, wherever
located.
"EPA" means the United States Environmental Protection Agency or any
successor thereto.
"EPC Spar Contracts" means contracts associated with the design,
engineering, construction and commissioning of the four deepwater platform
drilling rigs being constructed on behalf of two major oil company customers for
installation on spars and tension-leg platforms in connection with projects
known as Kizomba A, Kizomba B, Holstein and Mad Dog.
"Equity Interest" means as to any Person, any capital stock,
partnership interest, joint venture interest, company interest, membership
interest or other equity interest in such Person, or any warrant, option or
other right to acquire any Equity Interest in such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute, together with the
regulations thereunder, as in effect from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) which is a member of a group of which the Parent or the Borrower
is a member and which is under common control within the meaning of the
regulations under Section 414 of the Code.
"ERISA Liabilities" means at any time the minimum liability with
respect to Plans which would be required to be reflected at such time as a
liability on the balance sheet of the Parent or the Borrower under paragraphs 36
and 70 of Statement of Financial Accounting Standards No. 87, as such Statement
may from time to time be amended, modified or supplemented, or under any
successor statement issued in replacement thereof.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Federal Reserve Board, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule I hereto or in the Transfer Agreement pursuant to which it
became a Lender (or, if no such office is specified, its Domestic Lending
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Office) or such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent.
"Eurodollar Rate Reserve Percentage" of any Lender for any Interest
Period with respect to any LIBOR Advance means the reserve percentage applicable
during such Interest Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in such
Interest Period during which any such percentage shall be so applicable) under
regulations issued from time to time by the Federal Reserve Board for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) for such Lender with respect
to liabilities or assets consisting of or including Eurocurrency Liabilities
having a term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Excluded Subsidiaries" means the Excluded Subsidiaries (Collateral),
the Excluded Subsidiaries (Guaranty), the Excluded Subsidiaries (Mandatory
Prepayment) and the Excluded Subsidiaries (Pledge).
"Excluded Subsidiaries (Collateral)" means Foreign Subsidiaries,
captive insurance Subsidiaries, Project Finance Subsidiaries and any Subsidiary
that may not, pursuant to law or (if such Subsidiary is not a Wholly-Owned
Subsidiary of the Parent on the date hereof) any shareholders' or similar
agreement existing on the date hereof and applicable to such Subsidiary, ▇▇▇▇▇ ▇
▇▇▇▇ on its assets.
"Excluded Subsidiaries (Guaranty)" means all Subsidiaries that are not
Wholly-Owned Subsidiaries, Foreign Subsidiaries (other than Included Foreign
Guarantors), captive insurance Subsidiaries, Project Finance Subsidiaries and
Subsidiaries that, pursuant to law, may not guarantee the Obligations.
"Excluded Subsidiaries (Mandatory Prepayment)" means any Subsidiary
that may not, pursuant to law or (if such Subsidiary is not a Wholly-Owned
Subsidiary of the Parent on the date hereof) any shareholders' or similar
agreement existing on the date hereof and applicable to such Subsidiary, deliver
any Net Cash Proceeds of an Asset Disposition to the Borrower.
"Excluded Subsidiaries (Pledge)" means (a) all Domestic Subsidiaries
other than Domestic Subsidiaries of the Borrower, (b) all Foreign Subsidiaries
other than Included Foreign Pledge Subsidiaries, (c) Project Finance
Subsidiaries, (d) captive insurance Subsidiaries, and (e) any Subsidiary the
Equity Interests of which may not, pursuant to law or (if such Subsidiary is not
a Wholly-Owned Subsidiary of the Parent on the date hereof) any shareholders' or
similar agreement existing on the date hereof and applicable to such Subsidiary.
"Existing Credit Facilities" means the Existing Non-U.S. Revolver, the
Existing Term Facility and the Existing U.S. Revolver.
"Existing Letters of Credit" means the letters of credit listed on
Schedule 2.18(g).
"Existing Non-U.S. Revolver" means the Facility Agreement dated as of
October 24, 2003 among Forasub, Foramer, ▇▇▇▇▇▇ Maritime SNC, the lenders party
thereto and Natexis Banques Populaires, as agent, as amended, supplemented or
otherwise modified.
"Existing Parent" means Pride International, Inc., a Delaware
corporation.
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"Existing Term Facility" means the Term Loan Agreement dated as of
December 29, 2003 among the Parent, the Borrower, certain affiliates of the
Parent, the lenders party thereto and Credit Lyonnais New York Branch, as
administrative agent, as amended, supplemented or otherwise modified.
"Existing U.S. Revolver" means the Revolving Credit Agreement dated as
of June 20, 2002 among the Parent, the Borrower, certain affiliates of the
Parent, the lenders party thereto and Credit Lyonnais New York Branch as,
administrative agent.
"Expiration Date" means, for any Letter of Credit, the later of (i) the
Stated Expiry Date of such Letter of Credit or such earlier date, if any, on
which such Letter of Credit is permanently cancelled in writing by the Borrower,
the beneficiary thereof and each transferee, if any, thereof, (ii) if any
Extension Event referred to in clause (i) of the definition herein of Extension
Event shall occur in respect of such Letter of Credit, the date on which the
Issuing Bank shall receive an opinion from its counsel to the effect that a
final and nonappealable judgment or order has been rendered or issued either
terminating the order, injunction or other process or decree restraining the
Issuing Bank from paying under such Letter of Credit or permanently enjoining
the Issuing Bank from paying under such Letter of Credit, and (iii) if any
Extension Event referred to in clause (ii) of the definition herein of Extension
Event shall occur in respect of such Letter of Credit, the date on which the
Issuing Bank shall receive an opinion from its counsel to the effect that the
Issuing Bank has no further liability under such Letter of Credit.
"Extension Event" means, in respect of any Letter of Credit, that at
any time either (i) the Issuing Bank shall have been served with or otherwise be
subjected to a court order, injunction or other process or decree restraining or
seeking to restrain the Issuing Bank from paying any amount under such Letter of
Credit and either (a) there has been a drawing under such Letter of Credit which
the Issuing Bank would otherwise be obligated to pay or (b) the Stated Expiry
Date of such Letter of Credit has occurred but the right of the beneficiary or
transferee to draw under such Letter of Credit has been extended past such date
in connection with the pendency of the related court action or proceeding; or
(ii) the beneficiary or transferee shall have made a demand, on or prior to the
Stated Expiry Date of such Letter of Credit, to the effect that the Stated
Expiry Date be extended or that the value of such Letter of Credit be held for
the account of the beneficiary or transferee, in either case under circumstances
in which the Issuing Bank may incur liability or loss if the Issuing Bank does
not comply with such demand, and either (a) the Borrower shall have failed to
authorize the Issuing Bank to so extend the Stated Expiry Date within three
banking days after the Issuing Bank shall have notified the Borrower of such
demand or (b) the Issuing Bank shall in its sole discretion decline to extend
such Stated Expiry Date.
"Extraordinary Receipts" means all amounts received by, or for the
benefit of, the Parent or any Subsidiary on account of or as a result of any tax
refund, indemnity payment, pension reversion, any claim under any title
insurance policy, any exemplary, punitive or special damages (whether as a
result of an order, judgment, settlement or otherwise), other than, so long as
no Event of Default exists, proceeds less than $5,000,000 during the term of
this Agreement. For avoidance of doubt, cash receipts in the ordinary course of
business will not be considered to be Extraordinary Receipts.
"Fair Market Value" means Fair Value as determined in good faith by (a)
the principal financial officer of the Parent if less than or equal to $25
million and (b) the Board of Directors of the Parent if greater than $25
million.
"Fair Value" means the price that could be negotiated in an
arm's-length free market transaction, for cash, between a willing seller and a
willing buyer, neither of whom is under undue pressure or compulsion to complete
the transaction.
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"FDIC" means the Federal Deposit Insurance Corporation, or any federal
agency or authority of the United States from time to time succeeding to its
function.
"Federal Funds Rate" means, for any day, a fluctuating interest rate
per annum equal for such day to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System, or any federal agency or authority of the United States from
time to time succeeding to its function.
"Final Maturity Date" means (i) for a Revolving Advance, July 7, 2009,
and (ii) for a Term Advance, July 7, 2011.
"First Tier Foreign Subsidiary" means each Foreign Subsidiary, any
Equity Interest in which is owned directly by the Parent or any Domestic
Subsidiary.
"Foramer" means Pride Foramer S.A.S., a French company.
"Forasub" means Forasub B.V., a Netherlands company.
"Forasub Loan" means the unsecured loan in the amount of $150,000,000
made by the Borrower to Forasub on the date hereof.
"Foreign Subsidiary" means each Subsidiary organized and existing under
the law of a jurisdiction other than the United States, any state or territory
thereof, the District of Columbia or any political subdivision of the United
States, any state or territory thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles and policies in
the United States as in effect from time-to-time and concurred in by the
independent certified public accountants certifying the audited financial
statements referred to in 4.01(d)(i). All calculations for purposes of
determining compliance with Sections 5.02(a) and 5.02(b) of this Agreement,
however, shall be adjusted to reflect GAAP accounting principles and policies
consistent with those in effect on December 31, 2003.
"Governmental Requirements" means all judgments, orders, writs,
injunctions, decrees, awards, laws, ordinances, statutes, regulations, rules,
franchises, permits, certificates, licenses, authorizations and the like and any
other requirements of any government or any commission, board, court, agency,
instrumentality or political subdivision thereof.
"Guarantor" means the Parent, each Subsidiary listed below the heading
"Guarantors" on the signature pages hereto and each other Subsidiary that
executes a counterpart hereof from time to time, as contemplated by Section
5.01(k).
"Hazardous Materials" means (i) any substance or material identified as
a hazardous substance pursuant to any Environmental Law, (ii) any substance or
material regulated as a hazardous or solid waste pursuant to any Environmental
Law, (iii) any other material or substance regulated under any Environmental Law
and (iv) pollutants, contaminants, toxic substances, radioactive materials,
refined
-12-
products, natural gas liquids, crude oil, petroleum and petroleum products,
polychlorinated biphenyls and asbestos.
"Hedging Agreement" means any swap, collar, cap, option, any
combination of the foregoing or any other hedge relating to any commodity,
interest rates, currency, gas, electricity or other product or service.
"Illegality Event" has the meaning specified in Section 2.11.
"Included Foreign Guarantor" means each Foreign Subsidiary that, as a
result of a change in United States tax law relating to the repatriation of
earnings of foreign subsidiaries after the date hereof (other than a change in
United States tax law that permits, for a limited period of time, a foreign
subsidiary of a United States taxpayer to repatriate earnings without any member
of the consolidated group incurring United States income tax), may guarantee
obligations of the Borrower without adverse United States income tax
consequences relating to repatriation of earnings (other than Excluded
Subsidiaries (Guaranty)).
"Included Foreign Pledge Subsidiaries" means Included (Full) Foreign
Pledge Subsidiaries and Included (Partial) Foreign Pledge Subsidiaries.
"Included (Full) Foreign Pledge Subsidiary" means each Foreign
Subsidiary of the Borrower (other than those described in clauses (c), (d) and
(e) of the definition of Excluded Subsidiaries (Pledge)) all the Equity
Interests of which, as a result of a change in United States tax law relating to
the repatriation of earnings of foreign subsidiaries after the date hereof
(other than a change in United States tax law that permits, for a limited period
of time, a foreign subsidiary of a United States taxpayer to repatriate earnings
without any member of the consolidated group incurring United States income
tax), may be pledged to secure the obligations of the Borrower without adverse
United States income tax consequences relating to repatriation of earnings.
"Included (Partial) Foreign Pledge Subsidiaries" means each First Tier
Foreign Subsidiary of the Borrower or any Guarantor (other than those described
in clauses (c), (d) and (e) of the definition of Excluded Subsidiaries (Pledge)
and Included (Full) Foreign Pledge Subsidiaries).
"Indemnified Parties" has the meaning specified in Section 10.04(c).
"Information Memorandum" means the Confidential Information Memorandum
dated June 2004 relating to the Borrower and the transactions contemplated
hereby.
"Initial Rigs" means the mobile offshore drilling units and platform
drilling rigs listed on Exhibit K.
"Insufficiency" means, with respect to any Plan, the amount, if any, by
which the present value of the accrued benefits under such Plan exceeds the fair
market value of the assets of such Plan allocable to such benefits.
"Interest Coverage Ratio" means, for any period, the ratio of (i)
Consolidated EBITDA for such period to (ii) Consolidated Interest Expense for
such period.
"Interest Period" means, with respect to each LIBOR Advance, in each
case comprising part of the same Borrowing, the period commencing on the date of
such Advance or the date of the Conversion of any Advance into such an Advance
and ending on the last day of the period selected by the Borrower
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pursuant to the provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period and
ending on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be one, two,
three or six months, in each case as the Borrower may, upon notice received by
the Administrative Agent not later than 11:00 A.M. (New York City time) on the
third Business Day prior to the first day of such Interest Period, select;
provided that:
(i) Interest Periods commencing on the same date
for Advances comprising part of the same Borrowing shall be of the same
duration;
(ii) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding Business Day,
provided that if such extension would cause the last day of such Interest Period
to occur in the next following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day;
(iii) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month in which such Interest
Period would have ended if there were a numerically corresponding day in such
calendar month;
(iv) no Interest Period for any Advance may end
after the Final Maturity Date for such Advance;
(v) no Interest Period for any Term Advance may
end after any installment due date referred to in Section 2.04(c) unless, after
giving effect to the selection of such Interest Period, the aggregate unpaid
principal amount of Base Rate Term Advances and LIBOR Term Advances having
Interest Periods which end on or prior to such installment due date shall be at
least equal to the principal amount of Term Advances due on or prior to such
installment due date; and
(vi) the Borrower may not select any Interest
Period if any Event of Default exists.
"Investment" means, as applied to any Person, any direct or indirect
(i) purchase or other acquisition by such Person of any Equity Interest or Debt
of any other Person, (ii) loan or advance made by such Person to any other
Person, (iii) guaranty, assumption or other incurrence of liability by such
Person of or for any Debt or other obligation of any other Person, (iv) creation
of any Debt owed to such Person by any other Person, or (v) capital contribution
or other investment by such Person in any other Person. The amount of any
Investment shall be the original cost of such Investment plus the cost of all
additions thereto, minus the amount of any portion of such Investment repaid to
such Person as a dividend, repayment of loan or advance, release or discharge of
a guarantee or other obligation or other transfer of property or return of
capital, as the case may be, but without any other adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect to such
Investment or interest earned on such Investment. In determining the amount of
any Investment involving a transfer of property other than cash, such property
shall be valued at is Fair Market Value at the time of such transfer.
"Issuing Banks" means Calyon New York Branch and Natexis Banques
Populaires.
"ISM Code" has the meaning specified in Section 4.01(w).
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"Land Rig Disposition" means (i) any sale, lease, transfer or other
disposition (whether voluntary or involuntary, other than any damage,
destruction, loss or taking) of any land rig or the Equity Interests of any
Person that owns a land rig and (ii) any damage, destruction, loss or taking
relating to any land rig only to the extent it results in the receipt by the
Parent or any Subsidiary (other than an Excluded Subsidiary (Mandatory
Prepayment)) of total loss insurance payments and condemnation proceeds that, in
the aggregate, exceed $50,000,000 during the term of this Agreement) unless such
payments and proceeds in excess of $50,000,000 are (a) used to pay down the
outstanding Revolving Advances (with no required reduction in Revolving
Commitments) or deposited into and held in a segregated bank account and (b)
reinvested in replacement assets within one year of receipt.
"Land Rig Sale" means any voluntary sale that constitutes a Land Rig
Disposition pursuant to clause (i) of the definition herein of Land Rig
Disposition.
"Lender Parties" means the Collateral Agent, the Collateral Trustee,
the Administrative Agent, the Issuing Banks, the Swingline Lenders, the Lenders,
the Sole Lead Arranger and each holder of Other Obligations.
"Lenders" means the Revolving Lenders, the Swingline Lenders and the
Term Lenders.
"Letter of Credit" means each letter of credit issued by the Issuing
Banks pursuant to Section 2.18, as extended or otherwise modified by the Issuing
Banks from time to time.
"Letter of Credit Liabilities" means the maximum aggregate amount of
all undrawn portions of Letters of Credit (after giving effect to any step up
provision or other mechanism for increases, if any, and assuming compliance with
all conditions to drawing) plus the aggregate amount of all drawings under
Letters of Credit which are unpaid.
"Leverage Ratio" means, at any date of determination, the ratio of (a)
Consolidated Debt of the Parent and its Subsidiaries (excluding Debt referred to
in clause (xii) of the definition herein of Debt) as at the end of the then most
recently ended fiscal quarter of the Parent (which, if such date is the last day
of a fiscal quarter of the Parent, shall be such fiscal quarter) net of
unrestricted cash on which no Lien or restriction whatsoever exists (other than
usual and customary rights of set-off for deposit account fees and expenses
required by financial institutions where such cash is deposited) and cash
deposited, in connection with any Debt, in restricted accounts that require the
payee of such Debt to consent to withdrawal thereof and earmarked for
amortization of such Debt (other than the portion thereof payable against
interest) to (b) Consolidated EBITDA for such fiscal quarter and the immediately
preceding three fiscal quarters.
"L/C Cash Collateral Account" has the meaning specified in Section
6.02.
"L/C Related Documents" has the meaning specified in Section 2.18(d).
"LIBO Rate" means, for any Interest Period for each LIBOR Advance
comprising part of the same Borrowing, (a) the rate per annum (rounded upward,
if not an integral multiple of 1/100 of 1%, to the nearest 1/100 of 1% per
annum) appearing on Telerate Page 3750 (or any successor page) as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days before the first day of the relevant Interest
Period for a term comparable to such Interest Period; (b) if for any reason the
rate specified in clause (a) of this definition does not so appear on Telerate
Page 3750 (or any successor page), the rate per annum (rounded upward, if not an
integral multiple of 1/100 of 1%, to the nearest 1/100 of 1% per annum)
appearing on Reuters Screen LIBO page (or any successor page) as the London
interbank offered rate for deposits in Dollars at approximately
-15-
11:00 a.m. (London time) two Business Days before the first day of such Interest
Period for a term comparable to such Interest Period; provided that if more than
one rate is specified on Reuters Screen LIBO page (or any successor page), the
applicable rate shall be the arithmetic mean of all such rates; and (c) if the
rate specified in clause (a) of this definition does not so appear on Telerate
Page 3750 (or any successor page) and if no rate specified in clause (b) of this
definition so appears on Reuters Screen LIBO page (or any successor page), the
interest rate per annum (rounded upward to the nearest whole multiple of 1/16 of
1% per annum if such rate is not such a multiple) equal to the rate per annum at
which deposits in Dollars are offered by the principal office of Citibank in
London, England to prime banks in the London interbank market at 11:00 A.M.
(London time) two Business Days before the first day of such Interest Period in
an amount substantially equal to the amount of the LIBOR Advance of CNAI
comprising part of such Borrowing and for a period equal to such Interest
Period.
"LIBOR Advance" means an Advance which bears interest as provided in
Section 2.05(b) (or, if Section 2.05(c) applies, that bears interest at 2% per
annum above the rate provided in Section 2.05(b)).
"LIBOR Borrowing" means a Borrowing comprised of LIBOR Advances.
"LIBOR Revolving Advance" means a LIBOR Advance that is a Revolving
Advance.
"LIBOR Term Advance" means a LIBOR Advance that is a Term Advance.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien, claim or charge of any kind (including any production payment, advance
payment or similar arrangement with respect to minerals, any agreement to grant
any Lien, any conditional sale or other title retention agreement and the
interest of a lessor under a capital lease), whether or not filed, recorded or
otherwise perfected under applicable law. For the avoidance of doubt, an
agreement to refrain from granting a Lien shall not constitute a Lien.
"Liquid Securities" means securities (1) of an issuer that is not an
Affiliate of the Parent, (2) that are publicly traded on the New York Stock
Exchange, the American Stock Exchange, the Toronto Stock Exchange, the London
Stock Exchange or the Nasdaq National Market and (3) as to which (a) the Parent
is not subject to any restrictions on sale or transfer (including any volume
restrictions under Rule 144 under the Securities Act or any other restrictions
imposed by the Securities Act), (b) a registration statement under the
Securities Act covering the resale thereof is in effect, (c) the Parent or a
Subsidiary of the Parent is entitled to registration rights under the Securities
Act, or (d) in the case of any securities traded on the Toronto Stock Exchange
or London Stock Exchange, the Parent or a Subsidiary of the Parent has rights
comparable to those referred to in clauses (b) and (c) of this clause (3), in
each case in this clause (3) for as long as the securities are held; provided,
however, that securities meeting the requirements of clauses (1), (2) and (3) of
this definition shall be treated as Liquid Securities from the date of receipt
thereof until and only until the earlier of (x) the date on which such
securities are sold or exchanged for cash or cash equivalents and (y) 365 days
following the date of receipt of such securities. If such securities are not
sold or exchanged for cash or cash equivalents within 365 days of receipt
thereof, then, for purposes of determining whether the transaction pursuant to
which the securities were received complied with the provisions of Section
5.02(o) hereof, such securities shall be deemed not to have been Liquid
Securities at any time.
"Liquidity" means, at any time the sum of the maximum aggregate amount
that the Borrower can borrow at such time under Section 2.01(a) plus the amount
at such time of the Parent's and its Subsidiaries' Consolidated unrestricted
cash and cash equivalents if such cash and cash equivalents are not subject to
any Lien or any restriction whatsoever, other than usual and customary rights of
set-off for deposit account fees and expenses required by financial institutions
where such cash or cash equivalents
-16-
are deposited. For avoidance of doubt, the Note Redemption Deposit shall not
constitute unrestricted cash or cash equivalents.
"Losses" has the meaning specified in Section 10.04(c).
"Majority Lenders" means at any time Lenders holding more than 50% of
the sum of the then aggregate unpaid principal amount of the Advances held by
Lenders plus the then existing amount of Letter of Credit Liabilities plus the
then unused Commitments. For purposes of this definition, (i) Letter of Credit
Liabilities shall be considered held by the respective Revolving Lenders in
accordance with the respective amounts of their participations therein pursuant
to Section 2.18, with the Lender that is the Issuing Bank holding the balance
thereof after taking into account such participations and (ii) Swingline
Advances shall be considered held by the respective Revolving Lenders in
accordance with their respective Ratable Revolving Percentages.
"Mandatory Prepayment Debt" means any Debt of the Parent or any
Subsidiary incurred or issued after the date hereof other than Debt permitted
pursuant to Section 5.02(d).
"Material Adverse Effect" means a material adverse effect on (i) the
business, assets, operations, properties or condition (financial or otherwise)
of the Parent and its Subsidiaries, taken as a whole, (ii) the ability of the
Parent and its Subsidiaries, taken as a whole, to perform their obligations
under the Credit Documents, (iii) the rights of or benefits or remedies
available to any Lender Party party hereto under the Credit Documents or (iv)
the legality, validity, binding effect or enforceability of the Credit
Documents.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Parent, the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" means an employee benefit plan, other than a
Multiemployer Plan, subject to Title IV of ERISA to which the Parent, the
Borrower or any ERISA Affiliate, and one or more employers other than the
Parent, the Borrower or an ERISA Affiliate, is making or accruing an obligation
to make contributions or, in the event that any such plan has been terminated,
to which the Parent, the Borrower or any ERISA Affiliate made or accrued an
obligation to make contributions during any of the five plan years preceding the
date of termination of such plan.
"Net Cash Proceeds" means all Net Proceeds in the form of cash or cash
equivalents.
"Net Debt Proceeds" means all amounts received from time to time by, or
for the benefit of, the Parent or any Subsidiary pursuant to or in connection
with the issuance of any Mandatory Prepayment Debt net of all legal expenses,
commissions, discounts and fees incurred pursuant to such Mandatory Prepayment
Debt.
"Net Proceeds" means all consideration in whatever form (whether cash,
securities, accounts receivable, tangible property, intangible property or other
assets) received from time to time by, or for the benefit of, the Parent or any
Subsidiary pursuant to or in connection with any asset disposition net of (a)
all tax expenses, legal and title expenses, commissions and other fees and
expenses incurred as a result of such asset disposition, (b) all reserves for
indemnity obligations of the Parent or such Subsidiary in connection with such
asset disposition, (c) all payments made to any Person other than the Parent or
a Subsidiary on any Debt or other obligation (i) in accordance with the terms of
any Lien upon or with
-17-
respect to the assets disposed or (ii) which must, by its terms or in order to
obtain a necessary consent to such asset disposition or by applicable law, be
paid out of the proceeds from such asset disposition (including the amount of
any project finance debt that is repaid as contemplated in clause (d) of the
definition of Asset Disposition), (d) with respect to any asset disposition by a
Subsidiary, the Equity Interest in such consideration of any holder of Equity
Interests of such Subsidiary (other than the Parent or any other Subsidiary),
and (e) any taxes payable as a result of payment of proceeds to the Borrower for
application according to Section 2.04.
"9.375% Notes" means the 9.375% senior unsecured notes in the aggregate
principal amount of $175,000,000 issued by the Parent under the Indenture dated
May 1, 1997 between the Parent and JPMorgan Chase Bank, as Trustee.
"Non-Recourse Subsidiary" means each Subsidiary designated from time to
time by the Board of Directors of the Parent as a Non-Recourse Subsidiary in
accordance with Section 5.02(v).
"Note" means a Revolving Note, a Swingline Note or a Term Note.
"Note Redemption" means the redemption of the 9.375% Notes and 10%
Notes (to the extent not purchased by the Parent pursuant to the Tender Offer)
in full pursuant to the Note Redemption Notices.
"Note Redemption Deposit" means the deposit by the Parent of the amount
required to effect the Note Redemption with JPMorgan Chase Bank, as Trustee, in
connection with the Note Redemption.
"Note Redemption Notices" means notices to redeem the 9.375% Notes and
10% Notes in accordance with the applicable indentures.
"Notice of Borrowing" has the meaning specified in Section 2.02.
"Notice of Letter of Credit" has the meaning specified in Section
2.18(a).
"Obligations" means (i) all obligations (liquidated, contingent or
otherwise) from time to time owed by the Borrower, the Parent or any Subsidiary
pursuant to, as a result of or in connection with any of the Credit Documents,
including all principal of and interest on the Advances, all obligations to
reimburse the Issuing Banks for any payment under any Letter of Credit and all
obligations to pay fees, costs, expenses, indemnities and other amounts under
any Credit Document, and (ii) all Other Obligations.
"Opco Loan" means the $150,000,000 loan made on the date hereof by
Forasub to Foramer, evidenced by the Opco Note and secured by the Opco Loan
Collateral.
"Opco Loan Collateral" means the assets described on Exhibit M.
"Opco Loan Party" means Foramer and each owner of any Opco Loan
Collateral.
"Opco Note" means the note dated the date hereof payable by Foramer to
Forasub.
"Opco/Forasub Loan Reduction" means each payment, or other reduction,
of principal of the Opco Loan or Forasub Loan if after giving effect to such
payment or other reduction the principal balance of the Opco Loan or Forasub
Loan is less than $100,000,000.
-18-
"Opco/Forasub Loan Reduction Amount" means, with respect to any
Opco/Forasub Loan Reduction, (i) the amount of such Opco/Forasub Loan Reduction
minus (ii) the portion (if any) of such Opco/Forasub Loan Reduction that reduced
the principal of the Opco Loan or Forasub Loan to (but not below) $100,000,000.
"Other Obligations" means all obligations of the Parent or any
Subsidiary under any Hedging Agreement entered into by (i) the Parent or any
Subsidiary and (ii) any Secured Hedge Provider.
"Other Taxes" has the meaning specified in Section 2.13(c).
"Parent" means (a) the Existing Parent until the creation of a
Permitted Holding Company and (b) thereafter, the Permitted Holding Company that
is not a Subsidiary of another Permitted Holding Company.
"Patriot Act" means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub.
L. 107-56, signed into law October 26, 2001.
"Payment Office" means the office of the Administrative Agent located
at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or such other office as the
Administrative Agent may designate by written notice to the other parties
hereto.
"PBGC" means the Pension Benefit Guaranty Corporation, or any federal
agency or authority of the United States from time to time succeeding to its
function.
"Permitted Holding Company" means (a) from and after the time the
common stock of the Existing Parent is not listed on a United States or
non-United States national or regional securities exchange or traded through the
National Association of Securities Dealers Automated Quotation System or similar
system, a Person organized and validly existing under the laws of the United
States of America, any state thereof or the District of Columbia, the Bahamas,
Barbados, Bermuda, the British Virgin Islands, the Cayman Islands, any of the
Channel Islands, France, any other member of the European Union or the
Netherlands Antilles that, immediately after such time, had substantially the
same stockholders, directly or indirectly, as the Existing Parent immediately
prior to such time, (b) from and after the sale, lease, transfer or other
disposition of all or substantially all of the Existing Parent's and its
Subsidiaries' assets, the Existing Parent and (c) each Wholly-Owned Subsidiary
of another Permitted Holding Company that directly or indirectly owns the common
stock of the Existing Parent.
"Permitted Investments" means
(i) Investments in Cash Equivalents;
(ii) Investments in the Parent and Domestic
Subsidiaries made by the Parent or any Subsidiary, provided that any such
Investment in the Borrower or a Guarantor that is in the form of a loan from a
Person other than the Borrower or a Guarantor shall be subordinated to the
Obligations on terms reasonably satisfactory to the Administrative Agent;
(iii) Investments in Foreign Subsidiaries by other
Foreign Subsidiaries, provided that any such Investment in an Included Foreign
Guarantor that is in the form of a loan from a Person other than the Borrower or
a Guarantor shall be subordinated to the Obligations on terms reasonably
satisfactory to the Administrative Agent;
-19-
(iv) Investments in Foreign Subsidiaries by the
Parent and Domestic Subsidiaries if (a) such Investments are used by the Foreign
Subsidiaries in the contract drilling business or for a purpose related,
ancillary or complementary to the business of the Parent and its subsidiaries on
the date hereof, and (b) no more than $250,000,000 of Revolving Advances
(excluding Revolving Advances, if any, used to fund the Forasub Loan), the
proceeds of which were used for Investment in Foreign Subsidiaries, are
outstanding, provided that any such Investment in an Included Foreign Guarantor
that is in the form of a loan from a Person other than the Borrower or a
Guarantor shall be subordinated to the Obligations on terms reasonably
satisfactory to the Administrative Agent;
(v) Investments represented by proceeds from
dispositions of assets; and
(vi) any other Investment (in addition to those
referenced in clause (i) through (v) above) if (a) the amount of such Investment
(measured according to the definition of Investments), when taken together with
all other Investments described in this clause (vi) and made since the date
hereof, does not exceed 10% of Consolidated Net Tangible Assets determined as of
the date such Investment is made, and (b) such Investment is used in connection
with the contract drilling business or for a purpose related, ancillary or
complementary to the business of the Parent and its subsidiaries on the date
hereof. The value of any Equity Interests of the Parent issued in connection
with an Acquisition shall not be considered for purposes of the calculation in
clause (vi)(a).
"Permitted Restructuring" means (i) any amalgamation, merger or
consolidation among Foreign Subsidiaries if (a) no Event of Default exists at
the time of, or would result from, such amalgamation, merger or consolidation,
(b) all Liens on the Collateral are preserved in all respects as Acceptable
Security Interests (except that, if any Included Foreign Pledge Subsidiary
ceases to exist or ceases to be an Included Foreign Pledge Subsidiary as a part
of such amalgamation, merger or consolidation, the security interest
contemplated herein in the Equity Interests of such Included Foreign Pledge
Subsidiary may terminate simultaneously with the creation of an Acceptable
Security Interest in the percentage of the Equity Interests of all Included
Foreign Pledge Subsidiaries existing upon consummation of such amalgamation,
merger or consolidation that is contemplated in the definition of "Collateral"),
(c) the Forasub Loan, the Opco Loan and all mortgages securing the Opco Loan are
preserved in all respects (except that the maker and/or debtor of either such
loan, and/or grantor of one or more of such mortgages, may change), unless the
Forasub Loan and the Opco Loan have been paid in full, and (d) such
amalgamation, merger or consolidation could not reasonably be expected to result
in a Material Adverse Effect; and (ii) any amalgamation, merger or consolidation
among only Domestic Subsidiaries, among Domestic Subsidiaries and the Parent or
among Foreign Subsidiaries and the Parent if (a) no Event of Default exists at
the time of, or would result from, such amalgamation, merger or consolidation,
(b) all Liens on the Collateral are preserved in all respects as Acceptable
Security Interests (except that, if any Included Foreign Pledge Subsidiary
ceases to exist or ceases to be an Included Foreign Pledge Subsidiary as a part
of such amalgamation, merger or consolidation, the security interest
contemplated herein in the Equity Interests of such Included Foreign Pledge
Subsidiary may terminate simultaneously with the creation of an Acceptable
Security Interest in the percentage of the Equity Interests of all Included
Foreign Pledge Subsidiaries existing upon consummation of such amalgamation,
merger or consolidation that is contemplated in the definition of "Collateral"),
(c) the Forasub Loan is preserved in all respects, unless the Forasub Loan has
been paid in full, (d) such amalgamation, merger or consolidation could not
reasonably be expected to result in a Material Adverse Effect, and (e) the
existence of the Borrower and the Parent (or, if not the Parent, a Permitted
Holding Company) continues.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, firm or other entity, or a government or any
political subdivision or agency, department or instrumentality thereof.
-20-
"Plan" means an employee benefit plan (other than a Multiemployer Plan)
which is (or, in the event that any such plan has been terminated within five
years after a transaction described in Section 4069 of ERISA, was) maintained
for employees of the Parent, the Borrower or any ERISA Affiliate and covered by
Title IV of ERISA.
"Pledge" means a Pledge Agreement executed by the Parent or any
Subsidiary in substantially the form of Exhibit I, as amended, supplemented or
modified from time to time, and each other pledge agreement or other document
from time to time executed by a Credit Party pledging Equity Interests of the
Borrower or any Subsidiary to the Collateral Agent, as amended, supplemented or
modified from time to time.
"Preferred Interest" means, as applied to any Person, any Equity
Interest of such Person that is entitled to preference or priority over any
other Equity Interest of such Person in respect of either the payment of
dividends or distributions or the distribution of assets upon liquidation.
"Prescribed Forms" shall mean such duly executed forms or statements,
and in such number of copies, which may, from time to time, be prescribed by law
and which, pursuant to applicable provisions of (a) an income tax treaty between
the United States and the country of residence of the Lender providing the forms
or statements, (b) the Code, or (c) any applicable rule or regulation under the
Code, permit the Borrower to make payments hereunder for the account of such
Lender free of deduction or withholding of income or similar taxes (except for
any deduction or withholding of income or similar taxes as a result of any
change in or in the interpretation of any such treaty, the Code or any such rule
or regulation).
"Project Finance Debt" means (a) Debt with respect to the two
drilling/workover barge rigs owned by the Parent's Venezuelan Subsidiary as in
effect on the date hereof, (b) Debt with respect to the two drillships owned by
Andre Maritime Ltd. and ▇▇▇▇▇▇ Maritime Ltd. as in effect on the date hereof,
(c) Debt with respect to the one ▇▇▇▇-up rig owned by Foramer as in effect on
the date hereof, except for the $10,000,000 portion which is recourse to the
Parent, and (d) Debt (i) incurred to finance the purchase price or construction
cost of property (including the cost of upgrading, refurbishing or renovating
drilling rigs, drillships and other vessels and platforms) and related items
(including interest added to principal), (ii) which is non-recourse to the
Parent and its Subsidiaries, other than a Project Finance Subsidiary, (iii) for
which neither the Parent nor any of its Subsidiaries (other than a Project
Finance Subsidiary) shall have any liability whatsoever, whether direct or
indirect, contingent or otherwise, and (iv) the provider of which shall have no
recourse to any assets of the Parent and its Subsidiaries (other than the assets
for which such Project Finance Debt was incurred, the proceeds (including,
without limitation, proceeds from associated contracts and insurances) of, and
improvements, accessories and upgrades to, such assets and the Equity Interests
of any Project Finance Subsidiary that owns, whether directly or indirectly,
such assets).
"Project Finance Subsidiary" means any Subsidiary of the Parent whose
principal purpose is to incur Debt or to become an owner of interests in a
Person created to conduct the business activities for which such Debt was
incurred, and substantially all the fixed assets of which Subsidiary or Person
are those fixed assets being financed (or to be financed) in whole or in part by
such Debt.
"property" or "asset" (in either case, whether or not capitalized)
means any interest in any kind of property or asset, whether real, personal or
mixed, or tangible or intangible.
"Ratable Revolving Percentage" means as to any Revolving Lender at any
date the amount (expressed as a percentage) obtained (i) by dividing (a) such
Lender's Revolving Commitment at such date by (b) the aggregate amount at such
date of all Revolving Commitments of all of the Revolving
-21-
Lenders, or (ii) if no Revolving Commitments exist on such date, by dividing (a)
such Lender's Revolving Commitment immediately prior to the termination of the
Revolving Commitments by (b) the aggregate amount of all Revolving Commitments
of all of the Lenders immediately prior to such termination.
"Ratable Sharing Percentage" shall mean with respect to any Person, at
any date, the percentage of the Obligations owed at such date to such Person.
Each determination of any Ratable Sharing Percentage will be made by the
Administrative Agent and will be made (i) assuming that each Letter of Credit
has been drawn in its maximum face amount and that each Lender is owed the
amount of its participation in each Letter of Credit contemplated by the Credit
Agreement (or, in the case of the Lender that is the Issuing Bank, the remaining
amount after giving effect to such participations), (ii) assuming that each
Revolving Lender is owed the amount of its participation in each Swingline
Advance contemplated by the Credit Agreement (or, in the case of the Lender that
is a Swingline Lender, the remaining amount after giving effect to such
participations), (iii) assuming that the amount of each Other Obligation (a)
that has not been terminated prior to such date, is the Termination Amount of
such Other Obligation on such date, and (b) that has been terminated prior to
such date, is the amount owed by (or to) the Parent or any Subsidiary pursuant
to such Other Obligation, (iv) if any Secured Hedge Provider is a party to two
or more Other Obligations, applying concepts of netting to such Other
Obligations, and (v) if the amount of the Other Obligation (or net amount in the
case of multiple Other Obligations) is owed to the Parent or any Subsidiary,
rather than owed by the Parent or any Subsidiary, using zero as the amount (or
net amount) of such Other Obligation (or Other Obligations). Any Ratable Sharing
Percentage determined by the Administrative Agent in good faith shall be
conclusive and binding absent manifest error.
"Register" has the meaning specified in Section 10.06(c).
"Regulation U" means Regulation U of the Federal Reserve Board, as the
same is from time to time in effect.
"Responsible Officer" means, the Chief Executive Officer, President,
Chief Financial Officer, any Executive or Senior Vice President, or Treasurer of
the Parent or the Borrower.
"Restricted Preferred Interest" means any Preferred Interest which is
subject to retirement, purchase, redemption, other acquisition or conversion, in
whole or in part, at the option of the holder thereof (unless such option may
only be exercised on a fixed or determinable date or dates after July 31, 2011)
or at a fixed or determinable date or dates prior to or on July 31, 2011.
"Revolving Advance" means an advance by a Lender to the Borrower
pursuant to Section 2.01(a) and refers to a Base Rate Advance or a LIBOR
Advance, (each of which shall be a "Type" of Revolving Advance).
"Revolving Borrowing" means a borrowing hereunder consisting of
Revolving Advances of the same Type made on the same day by the Revolving
Lenders ratably in accordance with their respective Ratable Revolving
Percentages and in the case of LIBOR Advances, having the same Interest Period.
"Revolving Commitment" has the meaning specified in Section 2.01(a).
"Revolving Lenders" means the lenders listed on the signature pages
hereof under the heading "REVOLVING LENDERS" and each Eligible Assignee that
becomes a Revolving Lender party hereto pursuant to or Section 10.06(a), (b) and
(d).
-22-
"Revolving Loan Termination Date" means July 7, 2009 or the earlier
date of termination in whole of the Revolving Commitments pursuant to this
Agreement.
"Revolving Note" means a promissory note of the Borrower payable to the
order of any Revolving Lender, in substantially the form of Exhibit A-1,
evidencing the aggregate indebtedness of the Borrower to such Lender resulting
from Revolving Advances owed to such Lender.
"Rigs" (whether or not capitalized) means mobile offshore drilling
units, platform drilling rigs, land drilling rigs, offshore drilling rigs,
drilling barges, other drilling equipment, vessels and all related equipment.
"Sale Leaseback Transaction" of any Person means any arrangement
entered into by such Person or any Subsidiary of such Person, directly or
indirectly, whereby such Person or any Subsidiary of such Person shall sell or
transfer any property, whether now owned or hereafter acquired to any other
Person (a "Transferee"), and whereby such first Person or any Subsidiary of such
first Person shall then or thereafter rent or lease as lessee such property or
any part thereof or rent or lease as lessee from such Transferee or any other
Person other property which such first Person or any Subsidiary of such first
Person intends to use for substantially the same purpose or purposes as the
property sold or transferred.
"Secured Hedge Provider" means any Person that is a party to a Hedging
Agreement with the Parent or any Subsidiary that entered into such Hedging
Agreement while such Person was a Lender or an Affiliate of a Lender, whether or
not such Person at any time ceases to be a Lender or an Affiliate of a Lender,
as the case may be, and which Hedging Agreement has not been subjected to
additional transactions or confirmations while such Person was not a Lender or
an Affiliate of a Lender.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute.
"Security Agreement" means a Security Agreement executed by the
Borrower and/or one or more Guarantors in substantially the form of Exhibit H,
as amended, supplemented or modified from time to time.
"Security Documents" means the Vessel Documents, each Additional
Security Document, each Pledge, each Security Agreement and each security
document referred to in Section 5.01(k).
"Senior Notes" means the $500,000,000 senior unsecured notes due 2014
issued by the Parent on the date hereof.
"Sole Lead Arranger" means Citigroup Global Markets Inc.
"Solvent" means, with respect to any Person at any time, that at such
time (a) the fair value of the property of such Person is greater than the total
amount of liabilities, including contingent liabilities, of such Person, (b) the
present fair saleable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (c) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay such debts and liabilities as they mature and (d) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
an unreasonably small capital.
"SPC" has the meaning specified in Section 10.06(g).
-23-
"S&P" means Standard & Poor's Ratings Group, a division of ▇▇▇▇▇▇-▇▇▇▇,
Inc. on the date hereof.
"Stated Expiry Date" means the original expiration date stated on the
face of any Letter of Credit, or such other date, if any, to which the Issuing
Bank extends the expiration of such Letter of Credit at the request of the
Borrower.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, or other entity of which more than 50% of the outstanding Equity
Interests having ordinary voting power (irrespective of whether or not at the
time Equity Interests of any other class or classes of such corporation,
partnership, joint venture, or other entity shall or might have voting power
upon the occurrence of any contingency) is at the time owned directly or
indirectly by such Person; provided that each Non-Recourse Subsidiary shall be
deemed to not be a Subsidiary except for purposes of the definition herein of
Non-Recourse Subsidiary and Sections 3.01, 4.01(d), 5.01(a)(i), 5.01(a)(ii),
5.02 (v) and 5.02(w). Unless otherwise provided, the terms "Subsidiary" and
"Subsidiaries" refer to a Subsidiary or Subsidiaries of the Parent.
"Swingline Advance" means an advance by a Swingline Lender to the
Borrower pursuant to Section 2.01(c).
"Swingline Lenders" means Calyon New York Branch and Natexis Banques
Populaires.
"Swingline Note" means a promissory note of the Borrower payable to the
order of a Swingline Lender, in substantially the form of Exhibit A-3,
evidencing the aggregate indebtedness of the Borrower to such Swingline Lender
resulting from Swingline Advances.
"Taxes" has the meaning specified in Section 2.13(a).
"10% Notes" means the 10% senior unsecured notes in the aggregate
principal amount of $200,000,000 issued by the Parent under the Indenture dated
May 1, 1997 between the Parent and JPMorgan Chase Bank, as Trustee.
"Tender Offer" means the Parent's tender offer to purchase the 9.375%
Notes and the 10% Notes as further described in a document titled "Offer to
Purchase" dated June 10, 2004.
"Term Advance" means an advance by a Lender to the Borrower pursuant to
Section 2.01(b) and refers to a Base Rate Advance or a LIBOR Advance (each of
which shall be a "Type" of Term Advance).
"Term Borrowing" means each of (a) all Base Rate Term Advances
outstanding at any time and (b) all LIBOR Term Advances outstanding at any time.
"Term Commitment" means, as to any, Term Lender, the amount set
opposite such Term Lender's name on the signature pages hereof under the heading
"Term Commitments".
"Term Lenders" means the lenders listed on the signature pages hereof
under the heading "TERM LENDERS" and each Eligible Assignee that becomes a Term
Lender party hereto pursuant to Section 10.06(a), (b) and (d).
"Term Note" means a promissory note of the Borrower payable to the
order of any Term Lender, in substantially the form of Exhibit A-2, evidencing
the aggregate indebtedness of the Borrower to such Lender resulting from Term
Advances owed to such Lender.
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"Termination Amount" means, on any date, with respect to each Other
Obligation and the Secured Hedge Provider that is a party to such Other
Obligation, assuming termination of such Other Obligation on such date, the
amount determined by the Administrative Agent to be the amount that would be
owed by or to such Secured Hedge Provider upon such termination under then
prevailing circumstances in replacing, or in providing the economic equivalent
of, such Other Obligation, including all amounts owed thereunder on such date
that have not been paid.
In determining a Termination Amount, the Administrative Agent may
consider any relevant information, including, without limitation, one or more of
the following types of information:
(i) quotations (either firm or indicative) for replacement
transactions supplied by one or more third parties;
(ii) information consisting of relevant market data in the relevant
market supplied by one or more third parties including relevant rates, prices,
yields, yield curves, volatilities, spreads, correlations or other relevant
market data in the relevant market; or
(iii) information of the types described in clause (i) or (ii) above
from internal sources (including any of the Administrative Agent's affiliates)
if that information is of the same type used by the Administrative Agent in the
regular course of its business for the valuation of similar transactions.
Third parties supplying quotations pursuant to clause (i) above or
market data pursuant to clause (ii) above may include dealers in the relevant
markets, end-users of the relevant product, information vendors, brokers and
other sources of market information. Any Termination Amount determined by the
Administrative Agent in good faith shall be conclusive and binding absent
manifest error.
"Termination Event" means (a) a "reportable event", as such term is
described in Section 4043 of ERISA (other than a "reportable event" not subject
to the provision for 30-day notice to the PBGC), or an event described in
Section 4062(e) of ERISA, or (b) the withdrawal of the Parent, the Borrower or
any ERISA Affiliate from a Multiple Employer Plan during a plan year in which it
was a "substantial employer", as such term is defined in Section 4001(a)(2) of
ERISA, or the incurrence of liability by the Parent, the Borrower or any ERISA
Affiliate under Section 4064 of ERISA upon the termination of a Multiple
Employer Plan, or (c) the distribution of a notice of intent to terminate a Plan
pursuant to Section 4041(a)(2) of ERISA or the treatment of a Plan amendment as
a termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate a Plan by the PBGC under Section 4042 of ERISA, or (e) any other
event or condition which might constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan.
"Total Loss" means (a) the actual, constructive, arranged, agreed, or
compromised total loss of any rig that is part of the Collateral or secures the
Opco Loan, (b) the requisition for title or other compulsory acquisition or
forfeiture of any such rig otherwise than by requisition for hire; or (c) the
capture, seizure, arrest, detention or confiscation of any rig by any
governmental authority or Person acting or purporting to act on behalf of any
governmental authority unless such rig is released from such capture, seizure,
arrest, detention or confiscation within one month after the occurrence thereof.
"Transactions" means the making of the Advances, the issuance of
Letters of Credit, the issuance of the Senior Notes, the Tender Offer, the
giving of the Note Redemption Notices, the Note Redemption, the making of the
Note Redemption Deposit, the payment and termination of the Existing Credit
Facilities, the 9.375% Notes and the 10% Notes, the making of the Forasub Loan
and the Opco Loan, the execution of the Credit Documents, the execution of the
documents related to the Forasub Loan and the Opco Loan and the satisfaction of
all matters referred to in Section 3.01.
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"Transfer Agreement" means a transfer agreement entered into by a
Lender and an Eligible Assignee, and accepted by the Administrative Agent, in
substantially the form of Exhibit G.
"Twin Oaks" means Twin Oaks Financial Ltd., a British Virgin Islands
company.
"Twin Oaks Sale" means any disposition of the Equity Interests of Twin
Oaks, any of its subsidiaries or any successor (or purchaser of assets) of Twin
Oaks or any of its subsidiaries.
"Type" has the meaning specified in the definition of the term
"Revolving Advance" (with respect to a Revolving Advance) and in the definition
of the "Term Advance" (with respect to a Term Advance).
"Vessel Documents" means (i) the Vessel Mortgages (the "Vessel
Mortgages"), substantially in the form of Exhibit P-1, as the Collateral Agent
may determine are necessary, for each Initial Rig, (ii) the Assignments of
Insurances, substantially in the form of Exhibit P-2, for each Initial Rig, and
(iii) the Master Vessel and Trust Agreement, substantially in the form of
Exhibit P-3, covering each Initial Rig.
"Wholly-Owned Subsidiary" of any Person means any Subsidiary of such
Person all of the Equity Interests (other than shares required to law to be
owned by another Person, director's qualifying shares and other immaterial
interests) in which are owned by such Person and/or one or more other
Wholly-Owned Subsidiaries of such Person.
"Withdrawal Liability" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
Section 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding". Unless otherwise indicated, all references to a
particular time are references to New York City time.
Section 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.
Section 1.04. Miscellaneous. The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, and Article, Section, Schedule and Exhibit references are to Articles
and Sections of and Schedules and Exhibits to this Agreement, unless otherwise
specified. The term "including" shall mean "including, without limitation,", the
term "include" shall mean "include, without limitation," and the term "includes"
shall mean "includes, without limitation,".
ARTICLE II
AMOUNT AND TERMS OF THE ADVANCES AND LETTERS OF CREDIT
Section 2.01. The Advances. (a) Each Revolving Lender severally agrees,
on the terms and conditions hereinafter set forth, to make one or more Revolving
Advances to the Borrower from time to time on any Business Day during the period
from the date hereof until the Revolving Loan Termination Date in an aggregate
amount not to exceed at any time outstanding an amount equal to (i) the amount
set opposite such Revolving Lender's name on the signature pages hereof as its
Revolving Commitment or, if such Revolving Lender has entered into any Transfer
Agreement, set forth for such Revolving Lender as its Revolving Commitment in
the Register maintained by the Administrative Agent pursuant to Section
10.06(c), as such amount may be adjusted pursuant to Section 2.15, Section 2.16
or Section 6.01 (such Revolving Lender's "Revolving Commitment") minus (ii) such
Revolving Lender's Ratable
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Revolving Percentage of the sum of outstanding Swingline Advances plus
outstanding Letter of Credit Liabilities; provided that no Revolving Advance
shall be required to be made, except as part of a Revolving Borrowing that is in
an aggregate amount that is an integral multiple of $1,000,000 and is not less
than (a) in the case of a Revolving Borrowing comprised of LIBOR Advances,
$5,000,000 and (b) in the case of a Revolving Borrowing comprised of Base Rate
Advances, $3,000,000, and each Revolving Borrowing shall consist of Revolving
Advances of the same Type having (in the case of a Revolving Borrowing comprised
of LIBOR Advances) the same Interest Period, made on the same day by the
Revolving Lenders ratably according to their respective Revolving Commitments.
Within the limits of each Revolving Lender's commitment, the Borrower may
borrow, prepay pursuant to Section 2.09 and reborrow under this Section 2.01(a)
until the Revolving Loan Termination Date.
(b) Each Term Lender severally agrees, on the terms and
conditions hereinafter set forth, to make one Term Advance to the Borrower on
the date hereof in the amount set opposite such Term Lender's name on the
signature pages hereof as its Term Commitment. Amounts repaid or prepaid in
respect of the Term Advances may not be reborrowed and in no event will any
Lender be obligated to make a Term Advance after the date hereof.
(c) Subject to the terms and conditions set forth herein,
each Swingline Lender agrees to make Swingline Advances to the Borrower from
time to time until the Revolving Loan Termination Date, in an aggregate
principal amount at any time outstanding that will not result in (i) the
aggregate principal amount of outstanding Swingline Advances exceeding
$50,000,000, and (ii) the sum of the aggregate outstanding Swingline Advances
plus the aggregate outstanding Revolving Advances plus the aggregate outstanding
Letter of Credit Liabilities exceeding the total Commitments; provided that a
Swingline Lender shall not be required to make a Swingline Advance to refinance
an outstanding Swingline Advance. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Swingline Advances.
To request a Swingline Advance, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy), not
later than 3:00 p.m., New York City time, on the day of a proposed Swingline
Advance. Each such notice shall be irrevocable and shall specify the requested
date (which shall be a Business Day) and amount of the requested Swingline
Advance. The Administrative Agent will promptly advise the Swingline Lenders of
any such notice received from the Borrower. Subject to fulfillment of the
applicable conditions set forth in Article III, one or more Swingline Lenders
shall make each Swingline Advance available to the Borrower by means of a credit
to the general deposit account of the Borrower with such Swingline Lenders by
3:00 p.m., New York City time, on the requested date of such Swingline Advance.
Each Swingline Advance shall be a Base Rate Advance at all times. Each Swingline
Advance shall be in a minimum amount of $1,000,000 and in an integral multiple
of $1,000,000.
A Swingline Lender may by written notice given to the Administrative
Agent not later than 10:00 A.M., New York City time, on any Business Day require
the Revolving Lenders to acquire participations on such Business Day in all or a
portion of the Swingline Advances outstanding. Such notice shall specify the
aggregate amount of Swingline Advances in which Revolving Lenders will
participate. Promptly upon receipt of such notice, the Administrative Agent will
give notice thereof to each Revolving Lender, specifying in such notice such
Lender's Ratable Revolving Percentage of such Swingline Advances. Each Revolving
Lender hereby absolutely and unconditionally agrees, upon receipt of notice as
provided above, to pay to the Administrative Agent, for the account of the
applicable Swingline Lenders, such Lender's Ratable Revolving Percentage of such
Swingline Advances. Each Revolving Lender acknowledges and agrees that its
obligation to acquire participations in Swingline Advances pursuant to this
paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or Event of Default or reduction or
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termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever. Each Revolving
Lender shall comply with its obligation under this paragraph by wire transfer of
immediately available funds, in the same manner as provided in Section 2.02(a)
with respect to Revolving Advances made by such Lender, and the Administrative
Agent shall promptly pay to the applicable Swingline Lenders the amounts so
received by it from the Revolving Lenders. The Administrative Agent shall notify
the Borrower of any participations in any Swingline Advance acquired pursuant to
this paragraph, and thereafter payments in respect of such Swingline Advance
shall be made to the Administrative Agent and not to the Swingline Lenders. Any
amounts received by a Swingline Lender from the Borrower, any Guarantor, any
Collateral or otherwise in respect of a Swingline Advance after receipt by such
Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent, and any such amounts received by
the Administrative Agent shall be promptly remitted by the Administrative Agent
to the Revolving Lenders that shall have made their payments pursuant to this
paragraph and to the Swingline Lenders, as their interests may appear; provided
that any such payment so remitted shall be repaid to the Swingline Lenders or to
the Administrative Agent, as applicable, if and to the extent such payment is
required to be refunded to the Borrower, any owner of Collateral or any
Guarantor for any reason. The purchase of participations in a Swingline Advance
pursuant to this paragraph shall not relieve the Borrower of any default in the
payment thereof.
Section 2.02. Making the Advances. (a) Each Borrowing (other than a
Swingline Advance) shall be made on notice, given not later than 11:00 A.M. (New
York City time) (x) in the case of a proposed Borrowing comprised of LIBOR
Advances, at least three Business Days prior to the date of the proposed
Borrowing and (y) in the case of a proposed Borrowing comprised of Base Rate
Advances, one Business Day before the day of the proposed Borrowing, by the
Borrower to the Administrative Agent, which shall give prompt notice thereof by
telecopy to each Revolving Lender in the case of a Revolving Borrowing and to
each Term Lender in the case of the Term Borrowing. Each such notice of a
Borrowing (a "Notice of Borrowing") shall be by telecopy, confirmed immediately
in writing, in substantially the form of Exhibit B-1, identifying therein the
requested Borrowing as either a Term Borrowing or a Revolving Borrowing and
specifying therein the requested (i) date of such Borrowing, (ii) Type of
Advances comprising such Borrowing, (iii) aggregate amount of such Borrowing,
and (iv) in the case of a Borrowing comprised of LIBOR Advances, initial
Interest Period for each such Advance, provided that the Borrower may not
specify LIBOR Advances for any Revolving Borrowing if, after giving effect to
such Revolving Borrowing, LIBOR Revolving Advances having more than five
different Interest Periods shall be outstanding. Each Term Lender shall, before
11:00 A.M. (New York City time) on the date hereof, make available for the
account of its Applicable Lending Office to the Administrative Agent at its
Payment Office, in same day funds, such Term Lender's ratable portion of the
Term Borrowing. After the Administrative Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will make such funds available to the Borrower at the
Administrative Agent's Payment Office. Each Revolving Lender shall, before 11:00
A.M. (New York City time) on the date of a Revolving Borrowing, make available
for the account of its Applicable Lending Office to the Administrative Agent at
its Payment Office, in same day funds, such Revolving Lender's Ratable Revolving
Percentage of such Borrowing. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Administrative Agent will make such funds available to the Borrower at
the Administrative Agent's Payment Office.
(b) Each Notice of Borrowing shall be irrevocable and
binding on the Borrower. In the case of any Borrowing which the related Notice
of Borrowing specifies is to be comprised of LIBOR Advances, the Borrower shall
indemnify each Lender against any loss, cost or expense incurred by such Lender
as a result of any failure to fulfill on or before the date specified in such
Notice of Borrowing for such Borrowing the applicable conditions set forth in
Article III, including any loss (excluding loss of
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anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to fund the
Advance to be made by such Lender as part of such Borrowing when such Advance,
as a result of such failure, is not made on such date.
(c) Unless the Administrative Agent shall have received
notice from a Lender prior to the date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender's ratable portion of
such Borrowing, the Administrative Agent may assume that such Lender has made
such portion available to the Administrative Agent on the date of such Borrowing
in accordance with subsection (a) of this Section 2.02 and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If and to the extent that such Lender shall
not have so made such ratable portion available to the Administrative Agent,
such Lender and the Borrower severally agree to repay to the Administrative
Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Administrative Agent, at
(i) in the case of the Borrower, the interest rate applicable at the time to
Advances comprising such Borrowing and (ii) in the case of such Lender, the
Federal Funds Rate. If such Lender shall repay to the Administrative Agent such
corresponding amount, such amount so repaid shall constitute such Lender's
Advance as part of such Borrowing for purposes of this Agreement.
(d) The failure of any Lender to make the Advance to be
made by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
(e) The indebtedness of the Borrower to each Lender
resulting from Revolving Advances owing to such Lender shall be evidenced by the
Revolving Note of the Borrower payable to the order of such Lender in
substantially the form of Exhibit A-1. The indebtedness of the Borrower to each
Lender resulting from Term Advances owing to such Lender shall be evidenced by
the Term Note of the Borrower payable to the order of such Lender in
substantially the form of Exhibit A-2. The indebtedness of the Borrower to the
Swingline Lenders resulting from Swingline Advances shall be evidenced by the
Swingline Note of the Borrower payable to the order of the Swingline Lenders in
substantially the form of Exhibit A-3.
Section 2.03. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender a commitment fee
on the average daily unused amount of such Lender's Revolving Commitment from
the date hereof in the case of each Revolving Lender listed on the signature
pages hereof and from the effective date specified in the Transfer Agreement
pursuant to which it became a Revolving Lender in the case of each other
Revolving Lender until the Revolving Loan Termination Date at a rate per annum
equal to the Applicable Commitment Fee Rate in effect from time to time. The
commitment fee is payable quarterly in arrears on the last day of each March,
June, September and December, commencing September 30, 2004, and on the date of
termination or expiration of the Commitments.
(b) The Borrower shall pay to the Administrative Agent
such fees as may be separately agreed to by the Borrower and the Administrative
Agent.
Section 2.04. Mandatory Repayments. (a) The Borrower shall repay the
principal of all of the Revolving Advances on the Revolving Loan Termination
Date. Additionally, if at any time the sum of (i) the aggregate principal amount
of all Revolving Advances owed to any Revolving Lender plus (ii) such Revolving
Lender's Ratable Revolving Percentage of the sum of (A) the outstanding
Swingline Advances plus (B) the outstanding Letter of Credit Liabilities exceeds
its Revolving Commitment, the
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Borrower shall ratably repay to the Revolving Lenders the Revolving Advances in
an amount necessary so that no Revolving Lender is owed a principal amount of
Revolving Advances that exceeds the sum of (y) its Revolving Commitment minus
(z) such Revolving Lender's Ratable Revolving Percentage of the sum of (A) the
outstanding Swingline Advances plus (B) the outstanding Letter of Credit
Liabilities.
(b) The Borrower shall repay each Swingline Advance on
the 30th Business Day following the date such Swingline Advance is made.
(c) The Borrower shall repay to the Term Lenders the
principal of all of the Term Advances in 28 consecutive quarterly installments,
the first of which shall be due and payable on October 7, 2004, the next 26 of
which shall be due on the 7th day of each January, April, July and October
thereafter, and the final one of which shall be due and payable on July 7, 2011,
with the first 27 installments being in the aggregate principal amount of
$750,000 and the final installment being in the amount necessary to repay in
full the unpaid principal amount of all Term Advances.
(d) Subject to Sections 2.04(h) and 2.04(i), the Borrower
shall repay Advances in a principal amount equal to 100% of Net Debt Proceeds of
any Mandatory Prepayment Debt on the first Business Day (or if such payment
would result in the imposition of additional charges under Section 10.04(b) and
if no Event of Default exists, on the last day of the Interest Period then in
effect, provided that such Net Debt Proceeds are held in a segregated bank
account until such later payment date) following issuance of such Mandatory
Prepayment Debt.
(e) Subject to Sections 2.04(h) and 2.04(i), the Borrower
shall repay Advances in a principal amount equal to 100% of all Net Cash
Proceeds from (i) each Asset Disposition (other than a Land Rig Disposition) on
the third Business Day after the later of (A) the occurrence of such Asset
Disposition and (B) if the exception to the definition of Asset Disposition set
forth in clause (f) thereof could apply to such Asset Disposition, the date such
Asset Disposition ceases to qualify for such exception and (ii) each Land Rig
Disposition on the later of (A) 180 days after the occurrence of such Land Rig
Disposition and (B) if the exception to the definition of Land Rig Disposition
set forth in clause (ii) thereof could apply to such Land Rig Disposition, the
third Business Day after such Land Rig Disposition ceases to qualify for such
exception.
(f) Subject to Sections 2.04(h) and 2.04(i), the Borrower
shall repay Advances in a principal amount equal to 100% of all Extraordinary
Receipts on the third Business Day (or if such payment would result in the
imposition of additional charges under Section 10.04(b) and if no Event of
Default exists, on the last day of the Interest Period then in effect, provided
that such Extraordinary Receipts are held in a segregated bank account until
such later payment date) following receipt of such Extraordinary Receipts by, or
for the benefit of, the Parent or any Subsidiary, unless Liquidity (excluding
such Extraordinary Receipts) is $200,000,000 or more on the date of such
receipt.
(g) Subject to Sections 2.04(h) and 2.04(i), the Borrower
shall repay Advances in a principal amount equal to 100% of each Opco/Forasub
Loan Reduction Amount with respect to any Opco/Forasub Loan Reduction within one
Business Day of such Opco/Forasub Loan Reduction.
(h) At the time of each payment pursuant to this Section
2.04, the Borrower shall also pay accrued interest to the date of such payment
on the principal amount paid. If the Borrower pays any LIBOR Advance on any day
other than the last day of an Interest Period therefor, the Borrower shall
compensate the Lenders pursuant to Section 10.04(b). Subject to the proviso to
this sentence, the immediately following sentence and Section 2.04(i), the
payments pursuant Sections 2.04(d), 2.04(e), 2.04(f) and 2.04(g) shall be
applied ratably to the Term Advances only (and, notwithstanding Sections
2.04(d), 2.04(e), 2.04(f) and 2.04(g), payments in excess of such application
shall not be required to be
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made), with such payments being applied to installments of the Term Advances in
inverse order of maturity; provided that if, at the time of any payment pursuant
to Section 2.04(d), 2.04(e), 2.04(f) or 2.04(g), any statement in clause (i),
(ii) or (iii) of Section 3.02 is not true and correct as of such date as though
made on and as of such date (other than any representation and warranty that
expressly relates solely to a specific earlier date that remains correct as of
such earlier date), such payments shall be applied ratably to all of the
Advances and Demand Loans (for avoidance of doubt, without any reduction in the
Commitments) (and, notwithstanding Sections 2.04(d), 2.04(e), 2.04(f) and
2.04(g) but subject to the immediately following sentence and Section 2.04(i),
payments in excess of such application shall not be required to be made), with
the portion applied to the Term Advances being applied to installments of the
Term Advances in inverse order of maturity. Additionally, (i) in the case of any
payment pursuant to Section 2.04(e) as a result of an Asset Disposition that
constitutes a disposition of rigs or Equity Interests that constitute Collateral
or Opco Loan Collateral, if any portion of such payment would otherwise not be
required to be made by the immediately preceding sentence, the aggregate
Revolving Commitments shall be permanently and ratably reduced by the amount of
such portion (whether or not there are Revolving Advances, Swingline Advances or
Demand Loans outstanding), and (ii) in the case of any payment pursuant to
Section 2.04(g), if any portion of such payment would otherwise not be required
to be made by the immediately preceding sentence, such portion shall be made and
applied ratably to all of the Revolving Advances, Swingline Advances and Demand
Loans (but, notwithstanding Section 2.04(g) but subject to Section 2.04(i),
payment in excess of such application shall not be required to be made). Each
payment due pursuant to this Section 2.04 is cumulative of, and is in addition
to, all other payments due pursuant to this Section 2.04.
(i) To the extent that any amount would be required
hereunder to be paid and applied to a Revolving Advance, Swingline Advance or a
Demand Loan but for the fact that no Revolving Advance, Swingline Advance or
Demand Loan remains outstanding, the Borrower will pay such amount (but not in
excess of the then amount of Letter of Credit Liabilities) and cause such amount
to be deposited in a Collateral Account to be applied against Letter of Credit
Liabilities as they arise (but, notwithstanding Sections 2.04(d), 2.04(e),
2.04(f) and 2.04(g), payments in excess of such application shall not be
required to be made).
Section 2.05. Interest. The Borrower shall pay interest on the unpaid
principal amount of each Advance from the date of such Advance until such
principal amount shall be paid in full, at the following rates per annum:
(a) Base Rate Advances. During such periods as such
Advance is a Base Rate Advance, a rate per annum equal at all times to the sum
of the Base Rate in effect from time to time, plus (1) if such Advance is a
Revolving Advance, the Applicable Base Rate Margin for Revolving Advances in
effect from time to time and (2) if such Advance is a Term Advance, the
Applicable Base Rate Margin for Term Advances in effect from time to time, in
each case payable quarterly on the 7th day of each January, April, July, and
October during such periods, on each other date provided herein and on the date
such Base Rate Advance shall be Converted.
(b) LIBOR Advances. During such periods as such Advance
is a LIBOR Advance, a rate per annum equal at all times during each Interest
Period for such Advance to the sum of the LIBO Rate for such Interest Period for
such Advance plus (1) if such Advance is a Revolving Advance, the Applicable
LIBOR Margin for Revolving Advances in effect from time to time and (2) if such
Advance is a Term Advance, the Applicable LIBOR Margin for Term Advances, in
each case payable on the last day of such Interest Period, on each other date
provided herein and, if such Interest Period has a duration of more than three
months, on the day which occurs during such Interest Period three months from
the first day of such Interest Period.
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(c) Default Interest. The Borrower shall pay interest on
(i) all principal of any Advance that is not paid when due (whether at stated
maturity, by acceleration or otherwise), payable in arrears on demand, at a rate
per annum equal to 2% per annum above the rate per annum required to be paid on
such Advance pursuant to Section 2.05(a) or 2.05(b), as the case may be, and
(ii) to the fullest extent permitted by law, the amount of any interest,
commitment fee, Letter of Credit fee, other fee or other amount payable
hereunder that is not paid when due, from the date such amount shall be due
until such amount shall be paid in full, payable in arrears on the date such
amount shall be paid in full and on demand, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid on Base Rate
Term Advances pursuant to Section 2.05(a).
Section 2.06. Additional Interest on LIBOR Advances. The Borrower shall
pay to each Lender additional interest on the unpaid principal amount of each
LIBOR Advance of such Lender, for each Interest Period with respect to such
Advance, from the date of such Advance until such principal amount is paid in
full, at an interest rate per annum equal at all times to the remainder obtained
by subtracting (a) the LIBO Rate for such Interest Period for such Advance from
(b) the rate obtained by dividing such LIBO Rate by a percentage equal to 100%
minus the Eurodollar Rate Reserve Percentage of such Lender for such Interest
Period, payable on each date on which interest is payable on such Advance. Such
additional interest shall be determined by such Lender and notified to the
Borrower through the Administrative Agent. A certificate as to the amount of
such additional interest submitted to the Borrower and the Administrative Agent
by such Lender shall be conclusive and binding (absent manifest error) for all
purposes.
Section 2.07. Interest Rate Determination and Protection. (a) The
Administrative Agent shall determine the applicable rates of interest hereunder,
and such determinations shall be conclusive and binding absent manifest error.
(b) The Administrative Agent shall give prompt notice to
the Borrower and the Lenders of the applicable interest rate determined by the
Administrative Agent for purposes of Section 2.05(b).
(c) If the Administrative Agent is unable to obtain
timely information for determining the LIBO Rate for any LIBOR Advance,
(i) the Administrative Agent shall forthwith
notify the Borrower and the Lenders that the interest rate cannot be determined
for such LIBOR Advance,
(ii) each such Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance (or if such Advance is then a Base Rate Advance, will continue as a Base
Rate Advance), and
(iii) the obligation of the Lenders to make, or to
continue or to Convert Advances into, LIBOR Advances shall be suspended until
the Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
(d) If the holders of a majority of the Ratable Revolving
Percentages or of a majority of the Term Advances notify the Administrative
Agent that either (A) the applicable interest rate for any Interest Period for
any LIBOR Advance will not adequately reflect the cost to such holders of
making, funding or maintaining their respective LIBOR Advances for such Interest
Period, or (B) Dollar deposits in the amounts of their respective Advances for
such Interest Period are not available to them in the
-▇▇-
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ market, the Administrative Agent shall forthwith so notify the
Borrower and the Lenders, whereupon
(i) each such Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance (or, if such Advance is then a Base Rate Advance, will continue as a
Base Rate Advance), and
(ii) the obligation of the Lenders to make, or to
continue or to Convert Advances into, LIBOR Advances shall be suspended until
the Administrative Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.
(e) If the Borrower shall fail to select the duration of
any Interest Period for any LIBOR Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Lenders and
such Advances will automatically, on the last day of the then existing Interest
Period therefor, Convert into LIBOR Advances with an Interest Period of one
month.
(f) At the end of the relevant Interest Period following
the date on which the aggregate unpaid principal amount of Advances comprising
any LIBOR Borrowing shall be reduced, by payment or prepayment or otherwise, to
less than $5,000,000, such Advances shall automatically Convert into Base Rate
Advances, and on and after such date the right of the Borrower to Convert such
Advances into LIBOR Advances shall terminate.
Section 2.08. Conversion of Advances; Continuation. (a) The Borrower
may on any Business Day, upon notice given to the Administrative Agent not later
than 11:00 A.M. (New York City time) on the third Business Day prior to the date
of the proposed Conversion and subject to the limitations in Section 2.02(a) as
to the number of permitted Interest Periods and subject to the provisions of
Sections 2.07, 2.08(c) and 2.11, Convert all Advances of one Type comprising the
same Borrowing into Advances of the other Type; provided that any Conversion of
any LIBOR Advances shall be made on, and only on, the last day of an Interest
Period for such LIBOR Advances, and any Conversion of Base Rate Advances into
LIBOR Advances shall be in an amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof. Each such notice of a Conversion shall, within the
restrictions specified above, specify (i) the date of such Conversion, (ii) the
Advances to be Converted and (iii) if such Conversion is into LIBOR Advances,
the duration of the Interest Period for each such LIBOR Advance.
(b) The Borrower may continue any LIBOR Advances
comprising the same Borrowing for an additional Interest Period that complies
with the requirements set forth in the definition herein of "Interest Period,"
by giving notice of such Interest Period as set forth in such definition,
subject to the limitations in Section 2.02(a) as to the number of permitted
Interest Periods and subject to the provisions of Sections 2.07, 2.08(c) and
2.11.
(c) All Borrowings (other than Swingline Advances),
Conversions and continuations under this Agreement shall be effected in a manner
that (i) treats all Revolving Lenders ratably in the case of Revolving
Borrowings and (ii) treats all Term Lenders ratably in the case of Term
Borrowings. Notwithstanding any other provision hereof, during the continuance
of any Event of Default the Borrower may not continue any LIBOR Advance for an
additional Interest Period or Convert any Advance into a LIBOR Advance, and if
an Event of Default exists on the last day of an Interest Period for a LIBOR
Advance, such Advance shall automatically Convert to a Base Rate Advance on such
day.
Section 2.09. Optional Prepayments. The Borrower may (i) in respect of
LIBOR Advances, upon at least three Business Days' notice, and (ii) in respect
of Base Rate Advances, upon notice by 11:00
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A.M. (New York City time) on the day of the proposed prepayment, to the
Administrative Agent stating the proposed date and aggregate principal amount of
the prepayment and the Types of Advances to be prepaid, and the specific
Borrowing or Borrowings to be prepaid in whole or in part, and if such notice is
given the Borrower shall, prepay the outstanding principal amounts of the
Advances comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid without premium or penalty; provided that each partial prepayment
shall be in an aggregate principal amount not less than $5,000,000, and provided
further that if the Borrower prepays any LIBOR Advance on any day other than the
last day of an Interest Period therefor, the Borrower shall compensate the
Lenders pursuant to Section 10.04(b). Each prepayment of the principal of Term
Advances shall be applied to installments of principal in inverse order of their
maturity.
Section 2.10. Increased Costs; Capital Adequacy, Etc. (a) If, due to
either (i) the introduction of or any change in or in the interpretation of any
law or regulation by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof or (ii) the
compliance with any guideline or request from any governmental authority,
central bank or comparable agency (whether or not having the force of law),
there shall be any increase in the cost to any Lender of agreeing to make or
making, funding or maintaining LIBOR Advances, then the Borrower shall from time
to time, upon demand by such Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender additional amounts sufficient to compensate such Lender for such
increased cost.
(b) If any Lender shall have determined that, after the
date hereof, the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its lending office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has the effect of increasing the amount of
capital required or expected to be maintained as a result of its Commitment
hereunder or the existence of any Letter of Credit, such Lender shall have the
right to give prompt written notice and demand for payment thereof to the
Borrower with a copy to the Administrative Agent, although the failure to give
any such notice shall not release or diminish any of the Borrower's obligations
to pay additional amounts pursuant to this Section 2.10(b), and the Borrower
shall pay such additional amounts.
(c) Each Lender shall use commercially reasonable efforts
(consistent with its internal policies and legal and regulatory restrictions) to
select a jurisdiction for its Applicable Lending Office or change the
jurisdiction of its Applicable Lending Office, as the case may be, so as to
avoid the imposition of any increased costs under this Section 2.10 or to
eliminate the amount of any such increased cost which may thereafter accrue;
provided that no such selection or change of the jurisdiction for its Applicable
Lending Office shall be made if, in the reasonable judgment of such Lender, such
selection or change would be disadvantageous to such Lender.
(d) No Lender shall be entitled to recover increased
costs pursuant to this Section 2.10 incurred or accruing more than 90 days prior
to the date on which such Lender sent to the Borrower a written notice and
demand for payment as specified in this Section 2.10.
Section 2.11. Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation shall make it unlawful, or any governmental authority,
central bank or comparable agency shall assert that it is unlawful (such
unlawfulness or such assertion of unlawfulness being an "Illegality Event"), for
any Lender or its Eurodollar Lending Office (such a Lender being an "Affected
Lender") to perform its obligations
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hereunder to make LIBOR Advances or to continue to fund or maintain LIBOR
Advances hereunder, then, on notice thereof and demand therefor by such Lender
to the Borrower through the Administrative Agent, (a) the obligation of the
Lenders to make, or to continue or to Convert Advances into, LIBOR Advances
shall be suspended until the time set forth in the next succeeding sentence, and
(b) the Borrower shall forthwith Convert all LIBOR Advances of all Lenders then
outstanding into Base Rate Advances in accordance with Section 2.08. The
suspension of the obligation of the Lenders to make LIBOR Advances or to
continue or Convert, as set forth in the preceding sentence, shall terminate
upon the earlier of (i) the withdrawal by each Affected Lender of its notice and
demand with respect to the Illegality Event referenced in this Section 2.11, and
(ii) the replacement by the Borrower of each Affected Lender pursuant to Section
2.16(a) hereof with an Eligible Assignee that is not an Affected Lender. If an
Illegality Event has ceased to exist with respect to a Lender that has given
notice and demand with respect to such Illegality Event pursuant to this Section
2.11, such Lender shall promptly withdraw such notice and demand by giving
written notice of withdrawal to the Administrative Agent and the Borrower. Upon
termination of such suspension pursuant to clause (i) or (ii) above, as
applicable, the Administrative Agent shall notify each Lender of such
termination, and the Lenders shall thereupon again be obligated to make LIBOR
Advances and to continue, and Convert into, LIBOR Advances, in each case in
accordance with and to the extent provided in this Agreement.
Section 2.12. Payments and Computations. (a) The Borrower shall make
each payment under any Credit Document not later than 11:00 A.M. (New York City
time) on the day when due in Dollars to the Administrative Agent at its Payment
Office (or to an Issuing Bank, in the case of payments to an Issuing Bank under
Section 2.18, or to a Swingline Lender, in the case of payments to a Swingline
Lender under Section 2.04(b) or Section 2.09) in same day funds. The
Administrative Agent will promptly thereafter cause to be distributed (i) like
funds relating to the payment of principal of or interest on Revolving Advances,
commitment fees or commissions on Letters of Credit as contemplated by Section
2.18(b) ratably (other than amounts payable pursuant to Section 2.06 or 2.16) to
the Revolving Lenders (decreased, as to any Lender, for any taxes withheld in
respect of such Lender as contemplated by Section 2.13(b)) for the account of
their respective Applicable Lending Offices, (ii) like funds relating to the
payment of principal of or interest on Term Advances ratably (other than amounts
payable pursuant to Section 2.06 or 2.16) to the Term Lenders (decreased, as to
any Lender, for taxes withheld in respect of such Lender as contemplated by
Section 2.13(b)) for the account of their respective Applicable Lending Offices,
(iii) like funds relating to the payment of any other amount payable to any
Lender to such Lender for the account of its Applicable Lending Office, in each
case to be applied in accordance with the terms of this Agreement, and (iv) to
the Collateral Agent like funds relating to the payment of any amount payable to
the Collateral Agent. Upon its acceptance of a Transfer Agreement and recording
of the information contained therein in the Register pursuant to Section
10.06(d), from and after the effective date specified in such Transfer
Agreement, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender assignee
thereunder, and the parties to such Transfer Agreement shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves. At the time of each payment of any principal
of or interest on any Borrowing to the Administrative Agent, the Borrower shall
notify the Administrative Agent of the Borrowing to which such payment shall
apply. In the absence of such notice, the Administrative Agent may specify the
Borrowing to which such payment shall apply and with respect to voluntary
prepayments, will apply such payments to the Advances in the following order,
first to Revolving Advances, second to Base Rate Advances, and last to LIBOR
Advances (in the order of shortest to longest Interest Period).
(b) All computations of interest based on the Base Rate
(except during such times as the Base Rate is determined pursuant to clause (c)
of the definition thereof) shall be made by the Administrative Agent on the
basis of a year of 365 or 366 days, as the case may be, and all computations of
commitment fees and of interest based on the LIBO Rate, the Federal Funds Rate
or, during such times
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as the Base Rate is determined pursuant to clause (c) of the definition thereof,
the Base Rate shall be made by the Administrative Agent, and all computations of
interest pursuant to Section 2.06 shall be made by a Lender, on the basis of a
year of 360 days, in each case for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or commitment fees are payable. Each determination by the
Administrative Agent (or, in the case of Section 2.06, by a Lender) of an
interest rate hereunder shall be conclusive and binding for all purposes, absent
manifest error.
(c) Whenever any payment hereunder or under the Notes
shall be stated to be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of payment of interest or commitment
fees, as the case may be; provided that if such extension would cause payment of
interest on or principal of LIBOR Advances to be made in the next following
calendar month, such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to any
Lender hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to such Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
Section 2.13. Taxes. (a) Any and all payments by the Borrower hereunder
or under the other Credit Documents shall be made, in accordance with Section
2.12, free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges, fees, duties or withholdings, and
all liabilities with respect thereto, excluding, in the case of each Lender and
any other Lender Party, taxes imposed on its income, and franchise taxes imposed
on it, by the jurisdiction under the laws of which such Lender or Lender Party
(as the case may be) is organized or any political subdivision thereof and, in
the case of each Lender, taxes imposed on its income, and franchise taxes
imposed on it, by the jurisdiction of such Lender's Applicable Lending Office or
any political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, fees, duties, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
other Credit Document to any Lender or other Lender Party, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 2.13) such Lender or other Lender Party (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law.
(b) Notwithstanding anything to the contrary contained in
this Agreement, each of the Borrower and the Administrative Agent shall be
entitled, to the extent it is required to do so by law, to deduct or withhold
income or other similar taxes imposed by the United States of America from
interest, fees or other amounts payable hereunder for the account of any Lender
Party (without the payment by the Borrower of increased amounts to such Lender
Party pursuant to clause (a) above) other than a Lender Party (i) which is a
domestic corporation (as such term is defined in Section 7701 of the Code) for
federal income tax purposes or (ii) which has the Prescribed Forms on file with
the Borrower and the
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Administrative Agent for the applicable year, provided that if the Borrower
shall so deduct or withhold any such taxes, it shall provide a statement to the
Administrative Agent and such Lender Party, setting forth the amount of such
taxes so deducted or withheld, the applicable rate and any other information or
documentation which such Lender Party may reasonably request for assisting such
Lender Party to obtain any allowable credits or deductions for the taxes so
deducted or withheld in the jurisdiction or jurisdictions in which such Lender
is subject to tax.
(c) In addition, the Borrower agrees to pay any present
or future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or under
any other Credit Document or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or the any other Credit Document
(hereinafter referred to as "Other Taxes").
(d) Except as otherwise provided by Section 2.13(b), the
Borrower will indemnify each Lender and each other Lender Party for the full
amount of Taxes or Other Taxes (including any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this Section 2.13) paid by such Lender
or other Lender Party (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto
except as a result of the gross negligence or willful misconduct of such Lender
or other Lender Party (as the case may be), whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be made
within 30 days from the date such Lender or the other Lender Party (as the case
may be) makes written demand therefor. No Lender or other Lender Party shall be
indemnified for Taxes incurred or accrued more than 90 days prior to the date
that such Lender or other Lender Party notifies the Borrower thereof.
(e) Within 90 days after the date of any payment of Taxes
by or at the direction of the Borrower, the Borrower will furnish to the
Administrative Agent, at its address referred to in Section 10.02, (i) the
original or a certified copy of a receipt evidencing payment thereof, if the
relevant taxing authority provides a receipt, or (ii) if the relevant taxing
authority does not provide a receipt, other reasonable evidence of the payment
thereof. Should any Lender or other Lender Party ever receive any refund, credit
or deduction from any taxing authority to which such Lender or other Lender
Party would not be entitled but for the payment by the Borrower of Taxes as
required by this Section 2.13 (it being understood that the decision as to
whether or not to claim, and if claimed, as to the amount of any such refund,
credit or deduction shall be made by such Lender or other Lender Party, as the
case may be, in its sole discretion), such Lender or other Lender Party, as the
case may be, thereupon shall repay to the Borrower an amount with respect to
such refund, credit or deduction equal to any net reduction in taxes actually
obtained by such Lender or other Lender Party, as the case may be, and
determined by such Lender or other Lender Party, as the case may be, to be
attributable to such refund, credit or deduction.
(f) Each Lender shall use commercially reasonable efforts
(consistent with its internal policies and legal and regulatory restrictions) to
select a jurisdiction for its Applicable Lending Office or change the
jurisdiction of its Applicable Lending Office, as the case may be, so as to
avoid the imposition of any Taxes or to eliminate the amount of any such
additional amounts which may thereafter accrue; provided that no such selection
or change of the jurisdiction for its Applicable Lending Office shall be made
if, in the reasonable judgment of such Lender, such selection or change would be
disadvantageous to such Lender.
(g) Without prejudice to the survival of any other
agreement hereunder, the agreements and obligations of the Borrower contained in
this Section 2.13 shall survive the payment in full of all Obligations but shall
terminate thereafter at the end of six months after the expiration of the
applicable statute of limitations for assessment of Taxes or Other Taxes against
a Lender or Lender Party with respect to payments by the Borrower hereunder or
under the Other Credit Documents. Without
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prejudice to the survival of any other agreement hereunder, the agreements and
obligations of the Lender Parties contained in this Section 2.13 shall survive
the payment in full of all Obligations.
Section 2.14. Sharing of Payments, Etc. (a) If any Lender (a "benefited
Lender") shall at any time receive any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) on account of the
principal of or interest on the Advances owed to it (other than pursuant to
Section 2.06 or 2.16) or participations in Swingline Advances or in Letter of
Credit Liabilities ("Other Participations") held by it (other than pursuant to
Section 2.06 or 2.16) in excess of its ratable share of payments on account of
the Advances or other Participations, as the case may be, obtained by all
Lenders, such benefited Lender shall forthwith purchase from the other Lenders
such participations in the Advances owed to them or in their Other
Participations, as the case may be, as shall be necessary to cause such
benefited Lender to share the excess payment ratably with each of them, provided
that if all or any portion of such excess payment is thereafter recovered from
such benefited Lender, such purchase from each Lender shall be rescinded and
each such Lender shall repay to the benefited Lender the purchase price to the
extent of its ratable share (according to the proportion of (i) the amount of
the participation purchased from such Lender as a result of such excess payment
to (ii) the total amount of such excess payment) of such recovery together with
an amount equal to such Lender's ratable share (according to the proportion of
(i) the amount of such Lender's required repayment to (ii) the total amount so
recovered from the benefited Lender) of any interest or other amount paid or
payable by the benefited Lender in respect of the total amount so recovered.
(b) Each Credit Party agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.14
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of such Credit Party in the amount of
such participation.
Section 2.15. Ratable Reduction or Termination of the Commitments;
Effect of Termination. (a) The Borrower shall have the right, upon at least
three Business Days' notice to the Administrative Agent, to terminate in whole
or reduce ratably in part the unused portions of the respective Revolving
Commitments of the Lenders, provided that each partial reduction shall be in the
aggregate amount of at least $5,000,000.
(b) The respective Commitments of the Lenders shall
automatically be ratably reduced by the amount of each Opco/Forasub Loan
Reduction Amount to the extent such Opco/Forasub Loan Reduction Amount is not
applied to the Term Advances in accordance with Section 2.04.
(c) Upon and at all times after any Commitment of any
Lender is terminated pursuant to any provision of this Agreement, such
Commitment shall be zero and such Lender shall have no further obligation to
make any Advances.
Section 2.16. Replacement of Lender. (a) In the event that any Lender
demands payment pursuant to Section 2.06, 2.10 or 2.13, or any Lender becomes an
Affected Lender as set forth in Section 2.11, the Borrower shall have the right,
within 30 days after the date of the giving by such Lender of any notice or
demand required or otherwise permitted to be given pursuant to Section 2.06,
2.10, 2.11 or 2.13 and if no Event of Default or Default then exists, to replace
such Lender in accordance with the procedure set forth in Section 2.16(b);
provided that no such replacement shall be effected without (i) the prior
written consent of the Issuing Banks and the Swingline Lenders (such consent not
to be unreasonably withheld), (ii) in the case of the replacement of the Lender
that is a Swingline Lender, payment in full of all Swingline Advances owed to
such Swingline Lender and the agreement of the replacement Lender to become a
Swingline Lender, (iii) in the case of the replacement of the Lender that
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is an Issuing Bank, termination of all Letters of Credit issued by such Issuing
Bank (or other satisfaction of such Letters of Credit in a manner acceptable to
the Issuing Bank) and the agreement of the replacement Lender to become an
Issuing Bank, and (iv) in the case of the replacement of the Lender that is the
Collateral Agent, replacement of such Collateral Agent pursuant to Section 9.08.
(b) If the Borrower determines to replace a Lender
pursuant to this Section 2.16, then the Borrower will replace such Lender with
an Eligible Assignee in accordance with Section 10.06(a), (b) and (d), including
execution by such Eligible Assignee of an appropriate Transfer Agreement,
provided that no Lender or other Person shall have any obligation to increase
its Commitment or otherwise to replace, in whole or in part, any Lender. Upon
satisfaction of the requirements set forth in the first sentence of this Section
2.16(b), payment to such Lender of all principal, interest and, in the case of a
Revolving Lender, such Lender's share of accrued commitment fees and Letter of
Credit commissions, in immediately available funds, and the payment by the
Borrower of all requested costs accruing to the date of purchase which the
Borrower is obligated to pay under Section 10.04 and all other amounts owed by
the Borrower to such Lender, (i) such Lender being replaced shall execute such
Transfer Agreement and shall no longer constitute a "Lender" hereunder and all
of its Commitments shall be deemed terminated, except that its rights under
Sections 2.06, 2.10, 2.13 and 10.04 shall continue with respect to events and
occurrences occurring before or concurrently with its ceasing to be a "Lender"
hereunder, and (ii) such Eligible Assignee shall constitute a "Lender" hereunder
in accordance with such Transfer Agreement (including assumption of the
Commitment, if any, and other obligations of the Lender being so replaced).
Section 2.17. Certificates of Lenders. Any Lender demanding or giving
notice of amounts due to such Lender under this Article II shall, as part of
each demand or notice for payment required under this Article II, deliver to the
Borrower (with a copy to the Administrative Agent) a certificate setting forth
in reasonable detail the amount and basis of the increased costs or additional
amounts payable to such Lender hereunder and such certificate shall be
conclusive and binding in the absence of manifest error.
Section 2.18. Letters of Credit. (a) Each Issuing Bank agrees, on the
terms and conditions herein set forth, to issue Letters of Credit for the
account of the Parent or any Subsidiary of the Parent from time to time on any
Business Day during the period from the date hereof until one month before the
Revolving Loan Termination Date; provided that (i) at no time shall the Letter
of Credit Liabilities exceed $100,000,000, (ii) no Letter of Credit shall have a
Stated Expiry Date later than the earlier of one year from the date of its
issuance or June 30, 2009, and (iii) at no time shall a Letter of Credit be
issued if, after giving effect thereto, the sum of the aggregate amount of
Revolving Advances plus the outstanding Letter of Credit Liabilities plus the
outstanding Swingline Advances exceeds the Revolving Commitments. Each Letter of
Credit shall be issued on notice given by the Borrower to an Issuing Bank and
the Administrative Agent (which shall give to each Lender prompt notice thereof)
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the issuance of the proposed Letter of Credit. Each such notice
of a Letter of Credit (a "Notice of Letter of Credit") shall be by telecopier,
in substantially the form of Exhibit B-2, specifying therein the requested (i)
date of issuance of such Letter of Credit (which shall be a Business Day), (ii)
amount of such Letter of Credit (which must be in Dollars), (iii) expiration
date of such Letter of Credit, and (iv) purpose and terms of such Letter of
Credit and other information contemplated by Exhibit B-2. Additionally, if
requested by the Issuing Bank, the Borrower shall execute and deliver to the
Issuing Bank, an application for letter of credit on the Issuing Bank's standard
form or on another form agreed upon by the Borrower and the Issuing Bank.
(b) With respect to each Letter of Credit issued by an
Issuing Bank, the Borrower agrees to pay to such Issuing Bank, for its sole
account, an issuance fee in the amount agreed between such Issuing Bank and the
Borrower prior to delivery of the Notice of Letter of Credit on the maximum face
amount of such Letter of Credit and to the Administrative Agent a commission,
computed (on the basis of a year of 360 days for the actual number of days
elapsed) at a rate per annum equal to the
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Applicable Letter of Credit Rate in effect from time to time, on the maximum
face amount of such Letter of Credit from the date of issuance of such Letter of
Credit until the Expiration Date for such Letter of Credit payable quarterly in
arrears on the last Business Day of each quarter and on such Expiration Date
(which commission shall be shared ratably by all Revolving Lenders (including
the Issuing Bank) based on their respective Ratable Revolving Percentages).
Additionally, the Borrower agrees to pay all reasonable costs and expenses of
the Issuing Bank in connection with each Letter of Credit (including mailing
charges and out-of-pocket expenditures).
(c) The Borrower will immediately and unconditionally pay
to the Issuing Bank upon demand the amount of each payment made under any Letter
of Credit. If the Borrower shall fail to pay to the Issuing Bank the amount of
any such payment immediately upon demand in accordance with the terms of this
Agreement, such payment shall immediately constitute, without necessity of
further act or evidence, a loan (a "Demand Loan") made by the Issuing Bank to
the Borrower on the date of such payment in a principal amount equal to such
payment and repayable upon demand, together with interest on the principal
amount of such Demand Loan remaining unpaid from time to time, payable on demand
and computed from the date such Demand Loan is made as specified above to the
date of repayment in full thereof, at a rate per annum equal to the sum of the
Base Rate in effect from time to time plus the Applicable Base Rate Margin for
Term Advances in effect from time to time plus 2% per annum.
(d) The obligations of the Borrower under this Agreement
and any other agreement or instrument relating to any Letter of Credit shall be
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement and such other agreement or instrument under all
circumstances, including the following circumstances:
(i) any lack of validity or enforceability of
this Agreement, any Letter of Credit or any other agreement or instrument
relating thereto (collectively, the "L/C Related Documents");
(ii) any change in the time, manner or place of
payment of, or in any other term of, all or any of the obligations of the
Borrower in respect of any Letter of Credit or any other amendment or waiver of
or any consent to departure from all or any of the L/C Related Documents;
(iii) the existence of any claim, set-off, defense
or other right that the Borrower may have at any time against any beneficiary or
transferee of any Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the Issuing Bank or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by the L/C Related Documents or any other matter;
(iv) any statement or any other document
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(v) payment by the Issuing Bank under any Letter
of Credit against presentation of a draft or document that does not comply with
the terms of such Letter of Credit; or
(vi) any exchange, release or non-perfection of
any collateral for, or any release or amendment or waiver of or consent to
departure from any guarantee of, all or any of the obligations of the Borrower
in respect of any Letter of Credit.
However, this Section 2.18(d) shall not limit any right of the Borrower
to make a claim against the Issuing Bank to the extent provided in Section
2.18(e).
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(e) The Borrower assumes all risks of the acts or
omissions of any beneficiary or transferee of any Letter of Credit with respect
to the use of such Letter of Credit. Neither the Issuing Bank nor any branch,
affiliate or correspondent bank of the Issuing Bank nor any of their respective
employees, agents, officers or directors shall be liable or responsible for: (a)
the use that may be made of any Letter of Credit or any acts or omissions of any
beneficiary or transferee of any Letter of Credit in connection therewith; (b)
the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be invalid, insufficient,
fraudulent or forged; (c) payment by the Issuing Bank against presentation of
documents that do not strictly comply with the terms of the relevant Letter of
Credit, including failure of any documents to bear any reference or adequate
reference to the relevant Letter of Credit; or (d) any other circumstances
whatsoever in making or failing to make payment under any Letter of Credit;
provided that, notwithstanding clauses (a) through (d) of this sentence, the
Borrower shall have a claim against the Issuing Bank, and the Issuing Bank shall
be liable to the Borrower, to the extent of any direct, but not consequential or
other, damages suffered by the Borrower that the Borrower proves were caused by
(i) the Issuing Bank's willful misconduct or gross negligence in determining
whether documents presented under a Letter of Credit comply with the terms of
such Letter of Credit or (ii) the Issuing Bank's willful failure to make lawful
payment under a Letter of Credit after the presentation to it of a draft and
documents strictly complying with the terms and conditions of such Letter of
Credit. In furtherance and not in limitation of the foregoing, the Issuing Bank
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
(f) Upon the date of the issuance of a Letter of Credit,
the Issuing Bank shall be deemed to have sold to each other Revolving Lender and
each other Revolving Lender shall have been deemed to have purchased from the
Issuing Bank a ratable participation in the related Letter of Credit Liabilities
and all related Demand Loans equal to such Lender's Ratable Revolving Percentage
at such date. The Issuing Bank shall promptly notify each such participant
Revolving Lender of each Letter of Credit issued or increased, the amount of
such Lender's participation in such Letter of Credit and each payment
thereunder. Upon the making of any payment under any Letter of Credit, each
Lender (other than the Issuing Bank) shall pay for the purchase of its
participation therein by immediate payment to the Issuing Bank of same day funds
in the amount of its participation in such payment.
(g) Existing Letters of Credit. All Existing Letters of
Credit shall be deemed to be Letters of Credit issued under this Agreement as of
the Effective Date and shall constitute Letters of Credit hereunder for all
purposes (including Section 2.18(c) and Section 2.18(f)), and no notice
requesting issuance thereof shall be required hereunder. Each reference herein
to the issuance of a Letter of Credit shall include such deemed issuance. The
issuing bank for any Existing Letter of Credit shall be the Issuing Bank for
purposes of such Existing Letter of Credit. All fees accrued on the Existing
Letters of Credit to but excluding the Effective Date shall be for the account
of the relevant "Issuing Bank" and the "Revolving Lenders" (as those terms are
used in the Existing U.S. Revolver) as provided in the Existing U.S. Revolver,
and all fees accruing on the Existing Letters of Credit on and after the
Effective Date shall be for the account of the relevant Issuing Bank thereof and
the Revolving Lenders as provided herein.
ARTICLE III
CONDITIONS
Section 3.01. Initial Conditions Precedent. The obligation of any
Issuing Bank to issue the initial Letter of Credit and the obligation of each
Lender to make its initial Advance pursuant to the terms and conditions of this
Agreement is subject to the condition precedent that the Administrative Agent
shall have received on or before the day of the initial Advance (or, if earlier,
the day of issuance of the initial Letter of Credit) the following, each dated
on or before such day, in form and substance reasonably
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satisfactory to the Administrative Agent (the first day when all such conditions
have been satisfied or waived is hereinafter referred to as the "Effective
Date"):
(a) The Revolving Notes, Term Notes and Swingline Notes
payable to the order of the respective Lenders.
(b) The Security Documents and all documents required for
creation of an Acceptable Security Interest in the Collateral (including the
certificates pledged pursuant to the Pledge and financing statements).
(c) A certificate of the Secretary or an Assistant
Secretary of each Credit Party certifying (i) the resolutions of the board of
directors (or comparable governing body) of such Credit Party authorizing the
execution of each Credit Document to be executed by such Credit Party, (ii) the
charter and bylaws (or comparable documents) of such Credit Party and (iii) all
other documents evidencing any necessary company action and governmental and
other third party approvals and consents, if any, with respect to each such
Credit Document and the transactions thereunder.
(d) A certificate of the Secretary or an Assistant
Secretary of each Credit Party certifying the names and true signatures of the
officers (or agents) of such Credit Party authorized to sign each Credit
Document to be executed by it.
(e) An opinion of ▇▇▇▇▇ ▇▇▇▇▇ L.L.P., counsel for the
Borrower and the Guarantors substantially in the form of Exhibit C.
(f) An opinion of the general counsel of the Parent,
substantially in the form of Exhibit D.
(g) An opinion of ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P., counsel
for the Administrative Agent, substantially in the form of Exhibit E.
(h) An opinion of Holland & Knight LLP, counsel for the
Administrative Agent, substantially in the form of Exhibit F.
(i) Favorable local counsel opinions from such
jurisdictions as may be reasonably requested by the Administrative Agent
(including each jurisdiction in which Collateral or security for the Opco Loan
is located and each jurisdiction of formation of each Opco Loan Party).
(j) Lien searches in all relevant jurisdictions with
respect to the Borrower and each Guarantor.
(k) Certificates of existence, good standing and
qualification from appropriate state officials with respect to each Credit
Party.
(l) Certified copies of all Hedging Agreements evidencing
any Other Obligations.
(m) A certificate of an officer of the Parent (i)
certifying that the representations and warranties contained in each Credit
Document are correct, (ii) listing all insurance maintained by the Parent and
the Subsidiaries on the date hereof and (iii) certifying that such insurance
complies with Section 5.01(c) and is in full force and effect.
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(n) Evidence of payment by the Borrower of all filing and
recording fees and taxes and all fees and disbursements required to be paid by
the Borrower on the date hereof.
(o) Evidence that all Transactions (other than the making
of Advances, the issuance of Letters of Credit, the consummation of the Tender
Offer, the giving of the Note Redemption Notice, the making of the Note
Redemption Deposit and the Note Redemption) have been (or simultaneously with
the initial Advance will be) consummated in compliance with applicable law.
(p) All governmental, shareholder and third-party
consents and approvals necessary in connection with the Transactions.
(q) A pro forma Consolidated balance sheet of the Parent
and its Subsidiaries as of March 31, 2004, giving effect to the Transactions,
together with a certificate of the chief financial officer of the Parent to the
effect that such balance sheet fairly presents the pro forma financial position
of the Parent and its Subsidiaries in all material respects in accordance with
GAAP.
(r) A written certification of the chief financial
officer of the Parent that the Consolidated EBITDA for each fiscal month after
the end of March 31, 2004 had no inconsistencies with the forecasts for such
months set forth in the annual budget of the Parent previously provided to the
Lenders that could reasonably be expected to reflect a material adverse change
in the business, assets, operations, property or condition (financial or
otherwise) of the Parent and its Subsidiaries, taken as a whole, since December
31, 2003.
(s) Evidence that the Parent shall have received not less
than $375 million in gross cash proceeds from the issuance of the Senior Notes
on terms reasonably satisfactory to the Administrative Agent.
(t) Copies of the Senior Notes, the related indenture,
all documents related to the Forasub Loan, all documents related to the Opco
Loan, the Note Redemption Notices, the documents and filings related to the
Tender Offer and all other documents related to the Transactions.
(u) Evidence of the termination of the Existing Credit
Facilities, payment in full of all amounts owed thereunder and termination of
all Liens thereunder.
(v) Evidence that the Parent has available to it adequate
liquidity to consummate the Tender Offer and to make the Note Redemption
Deposit.
(w) Evidence that all (or if the Parent and the
Subsidiaries own less than all on the date hereof, then the percentage so owned)
Equity Interests of the Subsidiaries are owned by the Parent or one or more
Subsidiaries, in each case free and clear of any Lien not permitted hereby.
(x) A certificate from the Parent's independent maritime
insurance broker that the insurance maintained by the Parent and its
Subsidiaries with respect to the rigs that form part of the Collateral is in
full force and effect and conforms to the requirements of the Credit Documents.
(y) Endorsements naming the Collateral Agent or the
Collateral Trustee, on behalf of the Lenders, as an additional insured or sole
loss payee, as the case may be, and other customary endorsements, under all
insurance with respect to the rigs that form part of the Collateral.
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(z) Appraisals from ▇. ▇. ▇▇▇▇▇▇ (USA) Inc. and ▇. ▇▇▇▇▇
as to the value of the Initial Rigs (including, for the avoidance of doubt,
equipment that forms a part thereof) in form and substance reasonably
satisfactory to the Lenders.
(aa) Customary environmental certifications as required by
the Minerals Management Service or the United States Coast Guard, as the case
may be, in respect of any rig located in, or flagged under the laws of, the
United States.
(bb) All documentation and other information that the
Borrower and the Guarantors are required by bank regulatory authorities to
deliver to the Issuing Banks, the Lenders, the Collateral Agent and the
Administrative Agent under applicable "know your customer" and anti-money
laundering rules and regulations, including Title III of the Patriot Act that
has been identified by the Issuing Banks, the Lenders, the Collateral Agent and
the Administrative Agent and notified to the Borrower.
(cc) A certificate of an officer of the Borrower
certifying the ratings assigned to the Borrowings to be incurred under this
Agreement by S&P and ▇▇▇▇▇'▇.
Section 3.02. Additional Conditions Precedent to Each Advance. The
obligation of each Lender to make any Advance shall be subject to the additional
conditions precedent that on the date of such Advance (a) the following
statements shall be true (and each of the giving of the applicable Notice of
Borrowing and the acceptance by the Borrower of the proceeds of such Advance
shall constitute a representation and warranty by the Borrower that on the date
of such Advance such statements are true):
(i) The representations and warranties contained
in Section 4.01 are correct on and as of the date of such Advance (other than
those representations and warranties that expressly relate solely to a specific
earlier date and that remain correct as of such earlier date), before and after
giving effect to such Advance and the Borrowing of which such Advance is a part
and to the application of the proceeds therefrom, as though made on and as of
such date, and
(ii) The representations and warranties contained
in each other Credit Document are correct in all material respects on and as of
the date of such Advance (other than those representations and warranties that
expressly relate solely to a specific earlier date and that remain correct as of
such earlier date), before and after giving effect to such Advance and the
Borrowing of which such Advance is a part and to the application of the proceeds
therefrom, as though made on and as of such date, and
(iii) No event has occurred and is continuing, or
would result from such Advance or the Borrowing of which such Advance is a part
or from the application of the proceeds therefrom, which constitutes a Default
or an Event of Default, and
(b) the Administrative Agent shall have received such other approvals,
opinions or documents as the Majority Lenders through the Administrative Agent
may reasonably request.
Section 3.03. Conditions Precedent to Each Letter of Credit. The
obligation of an Issuing Bank to issue each Letter of Credit shall be subject to
the additional conditions precedent that on the date of issuance of such Letter
of Credit (a) the following statements shall be true (and each of the giving of
the applicable Notice of Letter of Credit and the acceptance by the Borrower of
the issuance of such Letter of Credit shall constitute a representation and
warranty by the Borrower that on the date of issuance of such Letter of Credit
such statements are true):
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(i) the representations and warranties contained
in Section 4.01 are correct on and as of the date of issuance of such Letter of
Credit (other than those representations and warranties that expressly relate
solely to a specific earlier date and that remain correct as of such earlier
date), before and after giving effect to such issuance, as though made on and as
of such date, and
(ii) The representations and warranties contained
in each other Credit Document are correct in all material respects on and as of
the date of such Advance (other than those representations and warranties that
expressly relate solely to a specific earlier date and that remain correct as of
such earlier date), before and after giving effect to such Advance and the
Borrowing of which such Advance is a part and to the application of the proceeds
therefrom, as though made on and as of such date, and
(iii) no event has occurred and is continuing, or
would result from such Letter of Credit, which constitutes a Default or an Event
of Default, and
and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as the Majority Lenders through the Administrative Agent
may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties. Each of the Parent and
the Borrower represents and warrants as follows:
(a) Each of the Parent and the Borrower is a corporation
duly organized and validly existing under the laws of the State of Delaware.
Each Subsidiary is duly organized or validly formed, validly existing and (if
applicable) in good standing in each case under the laws of its jurisdiction of
incorporation or formation, except where the failure to be so organized, formed,
existing or in good standing could not reasonably be expected, in the aggregate,
to result in a Material Adverse Effect. Each Subsidiary (other than any Excluded
Subsidiary (Guaranty)) has executed this Agreement as a Guarantor. The Parent
and each Subsidiary have all requisite powers required in each case to carry on
its business as now conducted, except where the failure to have such powers
could not reasonably be expected, in the aggregate, to result in a Material
Adverse Effect.
(b) The execution, delivery and performance by each
Credit Party of this Agreement, each Security Document executed at any time by
it, the Notes (in the case of the Borrower), each other Credit Document to which
it is or will be a party and the documents related to any Transaction to which
it is or will be a party are within such Credit Party's powers, have been duly
authorized by all necessary action of such Credit Party, require, in respect of
such Credit Party, no authorization, approval or other action by or in respect
of, or notice to or filing with, any governmental body, agency or official
(including any action or filing in connection with any exchange control), other
than governmental approvals and filings required for the Tender Offer that have
been made in accordance with law and, at all relevant times, are in full force
and effect, and do not contravene, or constitute a default under, (i) any
provision of law or regulation applicable to any Credit Party, (ii) Regulation
U, (iii) the charter, bylaws, company agreement or similar document of such
Credit Party or (iv) any judgment, injunction, order, decree or agreement
binding upon any Credit Party, or result in the creation or imposition of any
Lien on any asset of the Parent or any Subsidiary, except pursuant to the
Security Documents.
(c) Each Credit Document has been duly executed and
delivered by each Credit Party shown as being a party thereto. This Agreement
and each other Credit Document to which any
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Credit Party is a party (including, in the case of the Borrower, the Notes) are
legal, valid and binding obligations of such Credit Party enforceable against
such Credit Party in accordance with their respective terms, except as the
enforceability thereof may be limited by the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and by general principles of equity. Each document
related to any Transaction has been duly executed and delivered by each Credit
Party shown as being a party thereto. Each such document to which any Credit
Party is a party is a legal, valid and binding obligation of such Credit Party
enforceable against such Credit Party in accordance with its terms, except as
the enforceability thereof may be limited by the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and by general principles of equity.
(d) (i) The Consolidated balance sheet of the Parent
and its Subsidiaries as at December 31, 2003, and the related Consolidated
statements of income, cash flows and changes in stockholders' equity of the
Parent and its Subsidiaries for the fiscal year then ended, copies of which have
been furnished to each Lender, fairly present in all material respects the
Consolidated financial position of the Parent and its Subsidiaries as at such
date and the Consolidated results of operations of the Parent and its
Subsidiaries for the year ended on such date, all in accordance with GAAP. The
unaudited Consolidated balance sheet of the Parent as of March 31, 2004 and the
related unaudited Consolidated statements of income and cash flows for the three
month period ended March 31, 2004, certified by a financial or accounting
officer of the Parent, copies of which have been delivered to each of the
Lenders, fairly present in all material respects, in conformity with GAAP except
as otherwise expressly noted therein, the Consolidated financial position of the
Parent and its Subsidiaries as of such date and the Consolidated results of
operations of the Parent and its Subsidiaries for such period, subject to
changes resulting from audit and normal year-end adjustments.
(ii) the Consolidated balance sheet of the
Borrower and its Subsidiaries as at December 31, 2003, and the related
Consolidated statements of income, cash flows and changes in stockholders'
equity of the Borrower and its Subsidiaries for the fiscal year then ended,
copies of which have been furnished to each Lender, fairly present in all
material respects, the Consolidated financial position of the Borrower and its
Subsidiaries as at such date and the Consolidated results of operations of the
Borrower and its Subsidiaries for the year ended on such date, all in accordance
with GAAP. The unaudited Consolidated balance sheet of the Borrower as of March
31, 2004 and the related unaudited Consolidated statements of income and cash
flows for the three month period ended March 31, 2004, certified by a financial
or accounting officer of the Borrower, copies of which have been delivered to
each of the Lenders, fairly present in all material respects, in conformity with
GAAP except as otherwise expressly noted therein, the Consolidated financial
position of the Borrower as of such date and the Consolidated results of
operations of the Borrower and its Subsidiaries for such period, subject to
changes resulting from audit and normal year-end adjustments.
(e) Since December 31, 2003, there has been no material
adverse change in the business, assets, operations, property or condition
(financial or otherwise) of the Parent and its Subsidiaries, taken as a whole,
except as disclosed in the Parent's filings with the United States Securities
and Exchange Commission prior to the date hereof.
(f) There is no action, suit or proceeding pending
against the Parent or any Subsidiary, or to the knowledge of the Parent or any
Subsidiary threatened against the Parent or any Subsidiary, before any court or
arbitrator or any governmental body, agency or official, in which there is a
reasonable likelihood of an adverse decision that could reasonably be expected,
in the aggregate for all such actions, suits and proceedings, to result in a
Material Adverse Effect, or which in any manner draws into question the
legality, validity, binding effect or enforceability of this Agreement, any
other Credit Document or any document related to any Transaction.
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(g) No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan for which an Insufficiency in excess
of $50,000,000 exists. Neither the Parent nor any ERISA Affiliate has received
any notification (or has knowledge of any reason to expect) that any
Multiemployer Plan is in reorganization or has been terminated, within the
meaning of Title IV of ERISA, for which a Withdrawal Liability in excess of
$50,000,000 exists.
(h) The Parent and the Subsidiaries have filed or caused
to be filed all tax returns that are required to be filed by them and have paid
or provided for the payment, before the same become delinquent, of all taxes due
pursuant to such returns or pursuant to any assessment received by the Parent or
any Subsidiary, other than those taxes contested in good faith by appropriate
proceedings. The charges, accruals and reserves on the books of the Parent and
its Subsidiaries in respect of taxes are adequate.
(i) Neither the Parent nor any Subsidiary is (i) an
"investment company" or a company "controlled" by an "investment company" as
those terms are defined in, or subject to regulation under, the Investment
Company Act of 1940, as amended, or (ii) a "holding company" or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company," or a "public-utility company" as
those terms are defined in, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended. Neither the Parent nor any Subsidiary
is engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (as defined in Regulation U).
(j) Each of the Credit Parties, Opco Loan Parties and
Forasub is Solvent. Each of the Credit Parties, Opco Loan Parties and Forasub
was Solvent at the time of, and immediately after giving effect to, each step of
the Transactions.
(k) The fiscal year of the Parent is the twelve month
period ending on December 31 of each year, and the fiscal quarters of the Parent
are each of the three month periods ending on March 31, June 30, September 30
and December 31 of each year.
(l) Neither the Parent nor any Subsidiary is in default
under or with respect to, nor has any event or circumstance occurred which, but
for the passage of time or the giving of notice or both, would constitute a
default by the Parent or any Subsidiary under or with respect to, any contract,
agreement, lease or other instrument to which the Parent or such Subsidiary is a
party and which could reasonably be expected, in the aggregate, to result in a
Material Adverse Effect. No Default or Event of Default exists.
(m) The Parent and each of the Subsidiaries have been and
are in compliance in all respects with all applicable Environmental Laws, except
to the extent that failure to comply with such Environmental Laws could not
reasonably be expected to result in a Material Adverse Effect. There is (1) no
outstanding allegation by government officials or other third parties that the
Parent or any Subsidiary or any of their respective Properties is now, or at any
time prior to the date hereof was, in violation of any applicable Environmental
Law, (2) no administrative or judicial proceeding pending against the Parent or
any Subsidiary or against any of their respective Properties pursuant to any
Environmental Law, (3) no claim outstanding against the Parent or any Subsidiary
or against any of their respective Properties, businesses or operations which
was asserted pursuant to any Environmental Law, and (4) no pending or effective
Environmental Law that is reasonably likely to require new or additional capital
or other expenditures by the Parent or any Subsidiary that, in the case of all
matters described in clauses (1), (2), (3) or (4) above in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. There are no
facts or conditions or circumstances known to the Parent or any Subsidiary that
the Parent or any Subsidiary reasonably believes could form the basis for any
action, lawsuit, claim
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or proceeding involving the Parent or any Subsidiary or their respective past or
present Properties, businesses or operations relating to the Environment or
Environmental matters, including any action, lawsuit, claim or proceeding
arising from past or present practices or operations asserted under any
Environmental Law, that in the aggregate could reasonably be expected to result
in a Material Adverse Effect.
(n) The Parent and the Subsidiaries have good and valid
title to their respective property and to all property reflected by the balance
sheet referred to in Section 4.01(d)(i) as being owned by the Parent and its
Subsidiaries, in each case free and clear of all Liens except Liens permitted
hereby and except where the failure to have such title could not reasonably be
expected, in the aggregate, to result in a Material Adverse Effect. No Excluded
Subsidiary (Collateral) owns any interest in the Initial Rigs. There exists an
Acceptable Security Interest in all Collateral.
(o) Set forth in Part I of Exhibit K is a complete and
accurate list of all rigs owned by each Credit Party as of the date hereof that
are covered or to be covered by a Vessel Mortgage on the date hereof; each such
rig is, as of the date hereof, registered in the name of the Credit Party as
shipowner, and under the laws and flag of the jurisdiction, indicated, with such
rig located and deployed as of the date hereof as therein indicated.
(p) No statement, information, exhibit, representation,
warranty or report contained in any Credit Document, any document related to any
Transaction or the Information Memorandum or furnished to the Sole Lead
Arranger, the Administrative Agent, the Collateral Agent, the Collateral
Trustee, the Issuing Banks or any Lender in connection with or pursuant to any
Credit Document or the preparation or negotiation of any Credit Document
contains any material misstatement of fact or omitted to state a material fact
or any fact necessary to make the statements contained therein not materially
misleading when taken as a whole in light of the circumstances under which such
statements were made, provided that with respect to any financial projections,
the Parent and the Borrower represent and warrant only that such projections
have been prepared in good faith based upon assumptions that are reasonable at
the time made and at the time the projections are made available to any Lender
Party. There is no fact known to any Responsible Officer of the Parent that the
Parent has not disclosed to the Lenders in writing and that could reasonably be
expected to result in a Material Adverse Effect.
(q) Neither the Parent nor any Subsidiary (i) is in
violation of any Governmental Requirement or (ii) has failed to obtain any
license, permit, franchise, consent, approval or other governmental
authorization necessary to the ownership of any of their respective properties
or the conduct of their respective businesses, except such violations and
failures which could not reasonably be expected, in the aggregate (in the event
that such violation or failure were asserted by any Person through appropriate
action), to result in a Material Adverse Effect.
(r) Neither the business nor the properties or operations
of the Parent or any of the Subsidiaries are affected by any fire, explosion,
accident, strike, lockout or other labor dispute, act of God or of the public
enemy or other casualty (whether or not covered by insurance), that could
reasonably be expected, in the aggregate, to result in a Material Adverse
Effect.
(s) Each of the Parent and its Subsidiaries has all
requisite qualifications to own and operate its mobile offshore drilling units,
drilling rigs and other vessels under all appropriate laws (including the laws
of the jurisdiction of the location of such units, rigs and vessels and the
jurisdiction of the flag of such units, rigs and vessels), except where the
failure to have such qualifications could not reasonably be expected, in the
aggregate, to result in a Material Adverse Effect.
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(t) Each Transaction (other than the making of Advances,
the issuance of Letters of Credit, the Tender Offer and the Note Redemption) has
been consummated, or will be consummated simultaneously with the making of the
initial Advance, in accordance with applicable law and all applicable
agreements.
(u) Each of the Security Documents creates in favor of
the Collateral Agent for the benefit of the Lenders a legal, valid and
enforceable fully perfected first priority security interest in and Lien on all
right, title and interest of the Credit Parties in the Collateral described
therein, subject to no other Liens other than Collateral Permitted Liens. Each
Vessel Mortgage, executed and delivered, creates in favor of the mortgagee for
the benefit of the Lender Parties a legal, valid, and enforceable first
preferred mortgage lien over the Initial Rigs and when duly recorded in
accordance with the laws of each Initial Rig's flag, will constitute a
"preferred mortgage" within the meaning of Section 31301(6)(B) of Title 46 of
the United States Code, entitled to the benefits accorded a preferred mortgage
on a foreign vessel, in the case of Initial Rigs not registered under the laws
and flag of the United States, and in the case of Initial Rigs registered under
the laws and flag of the United States, constitutes a "preferred mortgage"
within the meaning of Section 31301(6)(B) of Title 46 of the United States Code,
entitled to the benefits accorded a preferred mortgage thereunder. No filings or
recordings are required in order to perfect the security interests created under
any Security Document except for filings or recordings which shall have been
made (x) on or prior to the date hereof, in the case of filings and recordings
in respect of the Initial Rigs, or (y) on or prior to the 10th day after of date
hereof in the case of all other Collateral.
(v) Each Initial Rig complies with the provisions of the
applicable Vessel Mortgage regarding classification.
(w) The Parent and the Subsidiaries are in compliance in
all material respects with the International Maritime Organization's
International Management Code for the Safe Operation of Ships and Pollution
Prevention ("ISM Code"), to the extent applicable, and have established and
implemented a safety management system and such other procedures as required by
the ISM Code, to the extent applicable.
ARTICLE V
COVENANTS
Section 5.01. Affirmative Covenants. Each of the Parent and the
Borrower covenants and agrees that so long as any Advance shall remain unpaid,
any Letter of Credit or Obligation shall remain outstanding or any Lender shall
have any Commitment hereunder, the Parent and the Borrower will:
(a) Reporting Requirements. Furnish to each Lender:
(i) as soon as available and in any event within
45 days after the end of each of the first three quarters of each fiscal year of
the Parent, the Consolidated balance sheets of the Parent and its Subsidiaries
and, with respect to each first tier Subsidiary of the Parent (including the
Borrower), the consolidating balance sheets of each such first tier Subsidiary
and its Subsidiaries, as at the end of such quarter, and the Consolidated
statements of income, cash flows and changes in stockholders' equity of the
Parent and its Subsidiaries and, with respect to each first tier Subsidiary of
the Parent (including the Borrower), the consolidating statements of income and
cash flows of each such first tier Subsidiary and its Subsidiaries for the
period commencing at the end of the previous fiscal year and ending with the end
of such quarter, setting forth, in comparative form, the corresponding figures
for the corresponding period of the preceding fiscal year, all in reasonable
detail and duly certified by a financial officer of the Parent as having been
prepared in accordance with GAAP, except for the absence of footnotes, and as
fairly
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presenting in all material respects the Consolidated and consolidating financial
position and results of operations of the Parent and its Subsidiaries and each
first tier Subsidiary of the Parent, as applicable, as of the end of such
quarter and for such periods, subject, however, to year-end audit adjustments,
together with a certificate of such officer showing in detail the calculations
of the financial covenants set forth in Sections 5.02(a) and 5.02(b) for the
four quarter period ending at the end of such quarter and as at the end of such
quarter, respectively (provided that the requirements of this Section 5.01(a)(i)
with respect to Consolidated financial statements of the Parent and its
Subsidiaries shall be deemed satisfied by delivery of the Parent's Form 10-Q for
such fiscal quarter);
(ii) as soon as available and in any event not
later than 90 days after the end of each fiscal year of the Parent, copies of
the Consolidated balance sheets of the Parent and its Subsidiaries and, with
respect to each first tier Subsidiary of the Parent (including the Borrower),
the consolidating balance sheets of each such first tier Subsidiary and its
Subsidiaries, as at the end of such fiscal year, and Consolidated statements of
income, cash flows and changes in stockholders' equity of the Parent and its
Subsidiaries and, with respect to each first tier Subsidiary of the Parent
(including the Borrower), the consolidating statements of income and cash flows
of each such first tier Subsidiary and its Subsidiaries, for such fiscal year,
all (except for such consolidating balance sheet and such consolidating
statements) certified by PricewaterhouseCoopers LLP or other independent
certified public accountants of recognized national standing, together with a
certificate of a financial officer of the Parent showing in detail the
calculations of the financial covenants set forth in Sections 5.02(a) and
5.02(b) for the four quarter period ending at the end of such year and as at the
end of such year, respectively, and certifying that such consolidating balance
sheet and consolidating statements fairly present, in all material respects, in
accordance with GAAP the consolidating financial position and consolidating
results of operations of the Parent and its Subsidiaries and each first tier
Subsidiary and its Subsidiaries, as applicable, as of the end of and for such
year (provided that the requirements of this Section 5.01(a)(ii) with respect to
Consolidated financial statements of the Parent and its Subsidiaries shall be
deemed satisfied by delivery of the Parent's Form 10-K for such fiscal year);
(iii) promptly after the sending or filing
thereof, copies of all material reports which the Parent or any Subsidiary sends
to the holders of its Equity Interests or public debt as such, and copies of all
reports and registration statements which the Parent or any Subsidiary files
with the Securities and Exchange Commission, or any governmental authority
succeeding to the functions of said Commission, or with any national securities
exchange;
(iv) promptly upon the receipt thereof by the
Parent or any Subsidiary, a copy of any written notice, complaint, request for
information under any Environmental Law, summons or citation received from the
EPA, or any other domestic or foreign governmental agency or instrumentality,
federal, state or local, in any way concerning any action or omission on the
part of the Parent or any of its present or former Subsidiaries in connection
with Hazardous Materials or the Environment if the amount involved could
reasonably be expected to result in a liability of the Parent or any Subsidiary
in excess of $50,000,000 in the aggregate, or concerning the filing of a Lien
upon, against or in connection with the Parent, its present or former
Subsidiaries, or any of their leased or owned property, wherever located;
(v) promptly after each receipt by the Parent or
any Subsidiary of any Net Proceeds, Net Cash Proceeds, Extraordinary Receipts or
Net Debt Proceeds, a reasonably detailed description thereof;
(vi) promptly after any Responsible Officer
obtains knowledge thereof, notice of (a) any material violation of,
noncompliance with, or remedial obligations under, any Environmental Law, (b)
any material release or threatened material release of Hazardous Materials
affecting any property owned, leased or operated by the Parent or any
Subsidiary, (c) the institution of
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any litigation or other proceeding in which the damages claimed are in excess of
$50,000,000 and any materially adverse development in any such litigation or
other proceeding, (d) the institution of any material investigation regarding
taxes of the Parent or any Subsidiary or the assertion of any material tax claim
against the Parent or any Subsidiary, (e) the assertion of any violation of any
law or agreement in connection with any Transaction or the making of any
material claim in connection with any Transaction, and (f) any condition or
event that could reasonably be expected to result in a Material Adverse Effect,
which notice shall specify the nature and period of existence thereof and
specify the notice given or action taken by such Person and the nature of any
such action, event or condition;
(vii) as soon as possible and in any event within
five days after any Responsible Officer having obtained knowledge thereof,
notice of the occurrence of any Event of Default or any Default, and a statement
of the chief financial officer of the Parent setting forth the details of such
Event of Default or Default and the action which the Parent has taken and
proposes to take with respect thereto;
(viii) as soon as possible and in any event (a)
within 30 Business Days after a Responsible Office knows that any Termination
Event described in clause (a) of the definition of Termination Event with
respect to any Plan for which an Insufficiency in excess of $50,000,000 exists,
has occurred and (b) within 10 Business Days after the Parent or any ERISA
Affiliate knows or has reason to know that any other Termination Event with
respect to any Plan for which an Insufficiency in excess of $50,000,000 exists,
has occurred, a statement of the chief financial officer or chief accounting
officer of the Parent describing such Termination Event and the action, if any,
which the Parent or such ERISA Affiliate proposes to take with respect thereto;
(ix) promptly and in any event within five
Business Days after receipt thereof by the Parent or any ERISA Affiliate, copies
of each notice received by the Parent or any ERISA Affiliate from the PBGC
stating its intention to terminate any Plan for which an Insufficiency in excess
of $50,000,000 exists or to have a trustee appointed to administer any Plan for
which an Insufficiency in excess of $50,000,000 exists;
(x) promptly and in any event within ten
Business Days after receipt thereof by the Parent or any ERISA Affiliate from
the sponsor of a Multiemployer Plan, a copy of each notice received by the
Parent or any ERISA Affiliate indicating liability in excess of $50,000,000
incurred or expected to be incurred by the Parent or any ERISA Affiliate in
connection with (a) the imposition of a Withdrawal Liability by a Multiemployer
Plan, (b) the determination that a Multiemployer Plan is, or is expected to be,
in reorganization within the meaning of Title IV of ERISA, or (c) the
termination of a Multiemployer Plan within the meaning of Title IV of ERISA;
(xi) concurrently with the reporting of the
financial ratios set forth in Sections 5.02(a) and 5.02(b) first occurring after
any acquisition or disposition (or series of related acquisitions or
dispositions) that is reasonably expected to increase or decrease Consolidated
EBITDA by at least $2,000,000 during the twelve-month period following the date
of such acquisition or disposition, a certificate of the chief financial officer
of the Parent setting forth the pro forma effect of such acquisition or
disposition on Consolidated EBITDA and Consolidated Interest Expense for each
quarter during the prior year as if such acquisition or disposition had occurred
one year prior to such date;
(xii) once during each June hereafter and
additionally within 30 days of request from time to time by the Majority
Lenders, independent rig appraisal reports, prepared by appraisers acceptable to
the Majority Lenders, on all rigs that constitute Collateral or secure the Opco
Loan, in each case as of a recent date and in form reasonably satisfactory to
the Majority Lenders (in the case of the first two such appraisal reports each
year, at the Borrower's expense);
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(xiii) promptly upon obtaining knowledge thereof by
any Responsible Officer, notice of (a) any Casualty Event if the Casualty
Proceeds with respect thereto could reasonably be expected to exceed $5,000,000
(or the equivalent in any other currency) with respect to any rig that is part
of the Collateral or secures the Opco Loan, (b) any disposition of any such rig,
(c) any occurrence in respect of any such rig that is or is likely, by the
passing of time or otherwise, to become a Total Loss, (d) any material
requirement made by any insurer or classification society or by any competent
authority which is not complied with within a reasonable time and (e) any arrest
of any such rig or the exercise or purported exercise of any Lien on any such
rig;
(xiv) as soon as available and in any event not
later than 90 days after the end of each fiscal year of the Parent, a report
prepared by the Parent's independent maritime insurance broker which report (i)
lists all insurance policies then in effect with respect to each rig that is
part of the Collateral or secures the Opco Loan, (ii) specifies for each such
policy (A) the amount thereof, (B) the risks insured against thereby, (C) the
name of the insurer and each insured party thereunder and (D) the policy number
or other identification number thereof and (iii) certifies that all such
insurance policies are (A) in full force and effect, (B) placed with responsible
and reputable insurance companies or associations and (C) conforming to the
requirements of this Agreement;
(xv) upon request by any Lender from time to
time, a copy of the safety management manual used to describe and implement the
Parent's safety management system developed, implemented and maintained in
compliance with the ISM Code, if applicable;
(xvi) promptly upon receipt thereof and following
such time as the appropriate officers of the parent shall have had reasonable
time to respond thereto, a copy of each formal report or "management letter"
submitted to the Parent or any Subsidiary by its independent accountants in
connection with any annual, interim or special audit made by it of the books of
the Parent or any Subsidiary;
(xvii) on or before 60 days after the commencement
of each fiscal year of the Parent, (a) a consolidated budget of the Parent and
the Subsidiaries which includes Consolidated income statements, balance sheets
and cash flow statements of the Parent and the Subsidiaries for each of the four
fiscal quarters of such fiscal year and (b) a breakdown of projected revenues,
operating expenses, utilizations and capital expenditures for each rig (other
than land drilling rigs) owned or leased by the Parent or any Subsidiary;
(xviii) on or before 45 days after the end of each
fiscal quarter of each fiscal year of the Parent, a report detailing (a) the
then current location of each rig that is part of the Collateral or secures the
Opco Loan and each other rig (other than land drilling rigs) owned or leased by
the Parent or any Subsidiary, and the then current term of any contract of any
rig (other than land drilling rigs) and (b) for the previous fiscal quarter, the
average day rates and utilization for each rig (other than land drilling rigs);
and
(xix) such other information respecting the
business, condition or operations, financial or otherwise, of the Parent or any
Subsidiary as any Lender through the Administrative Agent may from time to time
reasonably request.
(b) Compliance with Laws, Etc. Comply, and cause each of
its Subsidiaries to comply, with all applicable laws, rules, regulations and
orders (including ERISA and Environmental Laws) to the extent noncompliance
therewith could reasonably be expected to result in a Material Adverse Effect,
such compliance to include the paying before the same become delinquent of all
taxes,
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assessments and governmental charges imposed upon it or upon its property except
to the extent contested in good faith by appropriate proceedings.
(c) Maintenance of Insurance. Maintain, and cause each of
the Subsidiaries to maintain, insurance (including self-insurance) with
responsible and reputable insurance companies or associations in such amounts,
with such deductibles and covering such risks as is usually carried by companies
engaged in similar businesses and owning similar properties as the Parent and
the Subsidiaries, all as determined by the Parent in its reasonable judgment.
(d) Preservation of Existence, Etc. Except as permitted
by Section 5.02(e), preserve and maintain, and cause each of the Subsidiaries to
preserve and maintain, its legal existence, rights (charter, if applicable, and
statutory), franchises, permits, licenses and approvals and qualify and remain
qualified, and cause each Subsidiary to qualify and remain qualified, as a
foreign corporation or other entity in each jurisdiction in which qualification
is legally required; provided, that this Section 5.01(d) shall not prohibit any
Permitted Restructuring or transaction permitted under Section 5.02(o)
(including by liquidation or dissolution) or require the Parent or any
Subsidiary to preserve or maintain any legal existence (other than that of the
Borrower and the Parent (or, if not the Parent, a Permitted Holding Company)),
right, franchise, permit, license, approval or qualification if the Parent or
such Subsidiary shall determine that (i) the preservation and maintenance
thereof is no longer desirable in the conduct of the business of the Parent or
such Subsidiary, and that the loss thereof is not disadvantageous in any
material respect to the Lenders, or (ii) the failure to maintain and preserve
the same could not reasonably be expected, in the aggregate, to result in a
Material Adverse Effect. Upon receipt of a written request therefor from the
Borrower, the Administrative Agent will execute and deliver, at the Borrower's
expense, all documents as may reasonably be requested to effect a release of a
guaranty granted in accordance with Article 8 of this Agreement by any Person
that ceases to exist in accordance with this Section 5.01(d) or Section 5.02(e).
(e) Visitation Rights. At any reasonable time and from
time to time, permit (i) the Administrative Agent, the Collateral Agent, the
Collateral Trustee or any of the Lenders or any agents or representatives
thereof to visit and inspect the properties of, the Parent or any Subsidiary,
and (ii) the Administrative Agent and the Collateral Agent to examine and make
copies of the records and books of account of the Parent or any Subsidiary, and
to discuss the affairs, finances and accounts of the Parent or any Subsidiary
with, and be advised as to the same by, any of their respective Responsible
Officers of the Parent.
(f) Acceptable Security Interest. Cause an Acceptable
Security Interest to exist at all times in all Collateral.
(g) Maintenance of Properties. Maintain, and cause each
Subsidiary to maintain, in good repair, working order and condition (but subject
to reasonable wear and tear in the ordinary course of business), all property
used in the business of the Parent and the Subsidiaries and from time to time
make or cause to be made all appropriate repairs, renewals and replacements
thereof in all material respects, provided that this Section 5.01(g) shall not
apply to property that is lost or damaged in connection with a casualty event or
is subjected to a condemnation or other taking.
(h) Operation of Business. Operate, and cause each
Subsidiary to operate, its business and properties prudently in all material
respects in accordance with industry standards (including in respect of safety
and Environmental matters) and in accordance with all insurance requirements.
(i) Books and Records. Maintain, and cause each
Subsidiary to maintain, adequate books and records in accordance with sound
business practices and GAAP.
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(j) Obligations. Pay and perform and cause each of its
Subsidiaries to pay and perform, its material obligations when due, except where
the failure to do so could not reasonably be expected, in the aggregate, to
result in a Material Adverse Effect.
(k) Additional Guarantors. Concurrently with the creation
or acquisition of any Subsidiary, (i) unless such Subsidiary is an Excluded
Subsidiary (Guaranty), cause such Subsidiary to deliver to the Administrative
Agent a joinder agreement in the form of Exhibit Q executed by such Subsidiary
to become a Guarantor hereunder, legal opinions in respect of such Subsidiary
and this Agreement, from counsel reasonably acceptable to the Administrative
Agent, covering the types of matters covered in Exhibits C and D and
certificates of the type referred to in Sections 3.01(c) and 3.01(d) in respect
of such Subsidiary, all of which shall be in the form and substance reasonably
satisfactory to the Administrative Agent, (ii) unless such Subsidiary is an
Excluded Subsidiary (Pledge), cause each owner (other than owners that are not
the Parent or a Subsidiary of the Parent) of any Equity Interests of such
Subsidiary to deliver to the Administrative Agent a Pledge executed by such
owner to the extent required to pledge (taking all such owners collectively) the
portion of Equity Interests of such Subsidiary contemplated to be pledged in the
definition of "Collateral", all certificates evidencing such portion of such
Equity Interests, legal opinions in respect of such owner and such Pledge, from
counsel reasonably acceptable to the Administrative Agent, covering the types of
matters covered in Exhibits C and D and certificates of the type referred to in
Sections 3.01(c) and 3.01(d) in respect of such owner, all of which shall be in
form and substance reasonably satisfactory to the Administrative Agent, and
(iii) if such Subsidiary is a Subsidiary of the Borrower (other than an Excluded
Subsidiary (Collateral)), cause such Subsidiary to deliver to the Administrative
Agent security documents covering all Collateral owned by such Subsidiary
executed by such Subsidiary, legal opinions in respect of such Subsidiary and
such security documents, from counsel reasonably acceptable to the
Administrative Agent, covering the types of matters covered in Exhibits C and D
and certificates of the type referred to in Sections 3.01(c) and 3.01(d) in
respect of such Subsidiary, all of which shall be in the form and substance
reasonably satisfactory to the Administrative Agent.
(l) Further Assurances. At any time and from time to
time, at the Borrower's expense, promptly execute and deliver, and cause each
Subsidiary to execute and deliver, to the Collateral Agent or the Collateral
Trustee such further instruments and documents, and take such further action, as
the Majority Lenders may from time to time reasonably request, in order to
further carry out the intent and purpose of the Credit Documents and to
establish and protect the Liens, rights, interests and remedies created, or
intended to be created, in favor of the Collateral Agent, the Collateral Trustee
or any of the Lenders, including the execution, delivery, recordation and filing
of security agreements, financing statements, continuation statements and vessel
mortgages (each being an "Additional Security Document") and delivery of
Collateral.
(m) Ownership. Cause the Parent to own directly 100% of
the Equity Interests of the Borrower at all times.
(n) Transactions. Cause each Transaction to be
consummated in accordance with applicable law and all applicable agreements, and
(without limiting the generality of the foregoing) cause the 9.375% Notes and
10% Notes to be paid in full and retired on or before September 30, 2004 in all
material respects in accordance with the Note Redemption Notices, the related
indentures and applicable law.
Section 5.02. Negative Covenants. So long as any Advance shall remain
unpaid, any Letter of Credit or Obligation shall remain outstanding or any
Lender shall have any Commitment hereunder, each of the Parent and the Borrower
agrees that neither of them will at any time:
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(a) Interest Coverage Ratio. Permit the Interest Coverage
Ratio as of the end of any fiscal quarter (i) to be less than 2.50 to 1.00 for
any period of four consecutive fiscal quarters of the Parent ending after the
date hereof and on or before June 30, 2006, or (ii) to be less than 2.75 to 1.00
for any period of four consecutive fiscal quarters of the Parent ending after
June 30, 2006.
(b) Leverage Ratio. Permit the Leverage Ratio as of the
end of any fiscal quarter to exceed (i) 5.50 to 1.00 during the period from the
date hereof through December 31, 2005, (ii) 5.25 to 1.00 during the period from
January 1, 2006 through December 31, 2006, or (iii) 5.00 to 1.00 during the
period commencing January 1, 2007.
(c) Liens. Create, assume, incur or suffer to exist or
permit any Subsidiary to create, assume, incur or suffer to exist, any Lien on
or in respect of any property of the Parent or any Subsidiary, except that the
Parent and any Subsidiary may create, incur, assume or suffer to exist the
following:
(i) Liens on the Equity Interests of a
Non-Recourse Subsidiary;
(ii) Liens for taxes, assessments or governmental
charges or levies on property of the Parent or a Subsidiary, if the same are not
delinquent or are being contested in good faith and by appropriate proceedings
and with respect to which reserves in conformity with GAAP (to the extent
required by GAAP) have been provided on the books of the Parent or such
Subsidiary;
(iii) Liens that arise in the ordinary course of
business to secure payment for services rendered or goods provided to the Parent
or a Subsidiary and are imposed by law, such as construction, carriers',
warehousemen's, materialmen's, maritime and mechanics' liens and other similar
Liens, if the same are not delinquent or are being contested in good faith and
by appropriate proceedings and with respect to which reserves in conformity with
GAAP (to the extent required by GAAP) have been provided on the books of the
Parent or such Subsidiary;
(iv) Liens arising in the ordinary course of
business out of pledges or deposits required by workers' compensation,
unemployment insurance, social security, retirement benefits or similar laws;
(v) Liens created by any of the Credit
Documents;
(vi) Minor defects, irregularities and
deficiencies in title to, and easements, rights-of-way, zoning restrictions and
other similar restrictions, charges or encumbrances, in each case which do not
interfere with the ordinary conduct of its business, and which do not materially
detract from the value of the property which they affect;
(vii) Any right of set off arising under common
law or by statute;
(viii) Liens created by, resulting from or arising
in connection with any litigation or legal proceeding involving the Parent or
any of its Subsidiaries;
(ix) Liens arising in the ordinary course of
business securing the performance by the Parent or a Subsidiary of bids,
tenders, contracts (other than Debt), leases (other than capital leases),
statutory obligations and surety and appeal bonds, Liens arising in the ordinary
course of business to secure progress or partial payments made to the Parent or
any Subsidiary and other Liens of like nature made or incurred in the ordinary
course of business;
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(x) Liens to secure Debt, including Project
Finance Debt, incurred for the purpose of financing all or a part of the
purchase price or construction cost of property (including the cost of
upgrading, refurbishing or renovating drilling rigs, drillships and other
vessels and platforms) if in the case of all such Liens, (A) the principal
amount of the Debt secured by such Liens does not exceed the cost of the
property so acquired, constructed, upgraded, refurbished or renovated plus
transaction costs related thereto, (B) such Liens do not encumber any other
property (other than the proceeds (including, without limitation, proceeds from
associated contracts and insurances) of, and improvements, accessories and
upgrades to, the property so acquired, constructed, upgraded, refurbished or
renovated and the capital stock of Project Finance Subsidiaries that own,
whether directly or indirectly, only the property so acquired, constructed,
upgraded, refurbished or renovated) and (C) such Liens attach no later than 12
months after the latest of (x) commencement of commercial operation of the
property so acquired, constructed, upgraded, refurbished or renovated, (y)
completion of the construction, acquisition, upgrade, improvement or renovation
of such property and (z) acquisition of such property;
(xi) Liens existing on the date hereof (existing
Liens securing obligations exceeding $25,000,000 in the aggregate are set forth
on Exhibit N);
(xii) Liens created by capital leases provided
that the Liens created by any such capital lease attach only to the property
leased pursuant thereto and proceeds (including, without limitation, proceeds
from associated contracts and insurances) of, and improvements, accessories and
upgrades to, the property leased pursuant thereto;
(xiii) Liens existing on property at the time of
acquisition thereof by the Parent or any Subsidiary and not created in
contemplation thereof;
(xiv) Liens existing on property of a Subsidiary
at the time such Subsidiary is merged or consolidated with or into, or acquired
by, Parent or any Subsidiary or becomes a Subsidiary and not created in
contemplation thereof;
(xv) Liens securing (a) Debt among the Parent and
its Subsidiaries (other than Excluded Subsidiaries), (b) Debt among Subsidiaries
of the Parent (other than Liens granted to an Excluded Subsidiary), and (c) Debt
among Excluded Subsidiaries;
(xvi) Liens securing obligations not exceeding
$75,000,000 in the aggregate at any time;
(xvii) the Note Redemption Deposit and any other
deposit made to purchase notes tendered pursuant to the Tender Offer; and
(xviii) any Liens extending, renewing, refinancing,
refunding or replacing any of the foregoing (other than Liens permitted by
clause (viii), (ix) or (xvi) of this Section 5.02(c)) or Lien described in this
Section 5.02(c)(xviii), if (1) the amount secured by such Lien does not exceed
the amount secured by the Lien being extended, renewed, refinanced, refunded or
replaced at the time of such extension, renewal, refinancing, refunding or
replacement and (2) such Lien does not cover any property in addition to that
covered by the Lien being extended, renewed, refinanced, refunded or replaced.
(d) Debt. Create, incur, assume, guarantee, otherwise
become liable for or suffer to exist, or permit any Subsidiary to create, incur,
assume, guarantee, otherwise become liable for or suffer to exist, any Debt or
any Contingent Obligation other than:
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(i) Indebtedness under this Agreement;
(ii) the Senior Notes;
(iii) Debt of the Parent and its Subsidiaries in
an aggregate principal amount not to exceed $75,000,000;
(iv) Debt arising as a result of the endorsement
in the ordinary course of business of negotiable instruments in the course of
collection;
(v) Debt existing on the date hereof (Debt
existing on the date hereof exceeding $25,000,000 in the aggregate is set forth
on Exhibit O);
(vi) Debt created by capital leases of property
acquired or constructed (including upgrades, reburbishments and renovations) by
the Parent or a Subsidiary after the date hereof, provided that the only
property subject to such capital lease is the property so acquired, constructed,
upgraded, refurbished or renovated;
(vii) Debt securing Liens existing on property at
the time of acquisition thereof by the Parent or any Subsidiary and not created
in contemplation thereof;
(viii) Debt of a Subsidiary at the time such
Subsidiary is merged or consolidated with or into, or acquired by, Parent or any
Subsidiary or becomes a Subsidiary and not created in contemplation thereof;
(ix) Debt among the Parent and its Subsidiaries
or among Subsidiaries that constitutes a Permitted Investment;
(x) Reserved;
(xi) Debt, including, without limitation, Project
Finance Debt, incurred for the purpose of financing all or a part of the
purchase price or construction cost of property (including the cost of
upgrading, refurbishing or renovating drilling rigs, drillships and other
vessels and platforms) if (A) the principal amount of the Debt does not exceed
the cost of the property so acquired, constructed, upgraded, refurbished or
renovated plus transaction costs related thereto and (B) such Debt is incurred
no later than 12 months after the latest of (x) commencement of commercial
operation of the property so acquired, constructed, upgraded, refurbished or
renovated, (y) completion of the construction, acquisition, upgrade,
refurbishment or renovation of such property and (z) acquisition of such
property;
(xii) Any Debt extending, renewing, refinancing,
refunding or replacing any of the foregoing (other than Debt permitted by clause
(iii), (iv) and (ix) of this Section 5.02(d)) or Debt described in this Section
5.02(d)(xii), including fees and costs associated therewith, if (1) the amount
of such Debt does not exceed the amount of the Debt being extended, renewed,
refinanced, refunded or replaced outstanding at the time of such extension,
renewal, refinancing, refunding or replacement, (2) such Debt is not secured by
a Lien on any property in addition to that covered by any Lien then securing the
Debt being extended, renewed, refinanced, refunded or replaced, and (3) the
average weighted maturity of such Debt is not shorter than the average weighted
maturity of the Debt being extended, renewed, refinanced, refunded or replaced.
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(e) Mergers and Dispositions of All or Substantially All
Assets. (i) Merge, amalgamate or consolidate with or into any Person, or permit
any Subsidiary to merge, amalgamate or consolidate with or into any Person, or
(ii) convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions), or permit any Subsidiary to convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions), all or substantially all of its assets; provided that this
Section 5.02(e) shall not prohibit (x) any Permitted Restructuring, (y) any
merger, amalgamation or consolidation that occurs in connection with a Permitted
Investment or an Acquisition or (z) any transaction permitted under Section
5.02(o). Upon receipt of a written request therefor from the Borrower, the
Collateral Agent will execute and deliver, at the Borrower's expense, all
documents as may reasonably be requested to effect a release of the Liens held
by the Collateral Agent (or if such Liens are held by the Collateral Trustee,
the Collateral Agent will instruct the Collateral Trustee to execute and
deliver, at the Borrower's expense, all such documents) pursuant to the Security
Documents on any Collateral permitted to be released in accordance with the
definition of Permitted Restructuring.
(f) Restrictions on Dividends, Inter-company Loans, or
Investments. Create or otherwise cause or permit to become effective, or permit
any Subsidiary to create or otherwise cause or permit to become effective, any
consensual encumbrance or restriction (other than the Credit Documents) on the
ability of any Subsidiary (other than a Project Finance Subsidiary or a
Subsidiary that is not a Wholly-Owned Subsidiary of the Parent) to (i) pay
dividends or make any other distributions to, or pay any Debt owed to, the
Parent or any Subsidiary, (ii) make any loans or advances to or Investments in
the Parent or any Subsidiary, or (iii) transfer any property to the Parent or
any Subsidiary, in each case, other than encumbrances or restrictions contained
in, or existing by reasons of, any agreement or instrument (a) existing on the
date hereof, (b) relating to property existing at the time of the acquisition
thereof, so long as the encumbrance or restriction relates only to the property
so acquired, (c) relating to any Debt of, or otherwise to, any Subsidiary at the
time such Subsidiary was merged or consolidated with or into, or acquired by,
the Parent or a Subsidiary or became a Subsidiary and not created in
contemplation thereof, (d) effecting a renewal, extension, refinancing, refund
or replacement (or successive extensions, renewals, refinancings, refunds or
replacements) of Indebtedness issued under an agreement referred to in clauses
(a) through (c) above, so long as the encumbrances and restrictions contained in
any such renewal, extension, refinancing, refund or replacement agreement, taken
as a whole, are not materially more restrictive than the encumbrances and
restrictions contained in the original agreement, as determined in good faith by
the board of directors of the Parent, (e) constituting customary provisions
restricting subletting or assignment of any leases of the Parent or any
Subsidiary or provisions in agreements that restrict the assignment of such
agreement or any rights thereunder, (f) constituting restrictions on the sale or
other disposition of any property securing Debt as a result of a Lien on such
property permitted hereunder, (g) constituting any temporary encumbrance or
restriction with respect to a Subsidiary under an agreement that has been
entered into for the disposition of all or substantially all of the outstanding
Equity Interests of or assets of such Subsidiary, provided that such disposition
is otherwise permitted hereunder, (h) constituting customary restrictions on
cash, other deposits or assets imposed by customers and other persons under
contracts entered into in the ordinary course of business, (i) constituting
provisions contained in agreements or instruments relating to Debt that prohibit
the transfer of all or substantially all of the assets of the obligor under that
agreement or instrument unless the transferee assumes the obligations of the
obligor under such agreement or instrument or such assets may be transferred
subject to such prohibition, (j) constituting a requirement that a certain
amount of Debt be maintained between a Subsidiary and the Parent or another
Subsidiary, (k) constituting any encumbrance or restriction with respect to
property under an agreement that has been entered into for the disposition of
such property, provided that such disposition is otherwise permitted hereunder,
or (l) constituting any encumbrance or restriction with respect to property
under a charter, lease or other agreement that has been entered into for the
employment of such property.
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(g) Debt Retirement. Pay, prepay, redeem or purchase, or
deposit funds or property for the payment, prepayment, redemption or purchase
of, or set aside or segregate in trust any amount for any holder of, or permit
any Subsidiary to pay, prepay, redeem or purchase, or deposit funds or property
for the payment, prepayment, redemption or purchase of, or set aside or
segregate in trust any amount for any holder of, any Debt, except (i) if no
Event of Default exists or no Default would be caused thereby, inter-company
Debt between the Parent and a Subsidiary of the Parent or between Subsidiaries
of the Parent, (ii) as required by the terms of such Debt as in effect on the
later of the date such Debt was incurred and the date hereof, or (iii) if
Liquidity is at least $200,000,000 after such payment, prepayment, redemption,
purchase, deposit, setting aside or segregation.
(h) Reserved
(i) Compliance with ERISA. Terminate any Plan so as to
result in any liability of the Parent or any Subsidiary to the PBGC in excess of
$50,000,000.
(j) Reserved
(k) Affiliate Transaction. Make or permit any Subsidiary
to make, directly or indirectly, any Investment in any Affiliate, any transfer,
sale, lease or other disposition of any property to any Affiliate, any purchase
or acquisition of any property from an Affiliate or any other arrangement or
transaction directly or indirectly with or for the benefit of an Affiliate
(including guaranties and assumptions of obligations of an Affiliate); provided
that the Parent and any Subsidiary may enter into any arrangement or other
transaction with an Affiliate if the terms thereof (including consideration
paid) are substantially as advantageous to the Parent and such Subsidiary as the
terms which would be obtained in a comparable arm's length transaction with a
Person not an Affiliate; provided further that this Section 5.02(k) shall not
apply to reasonable compensation (including amounts paid pursuant to Plans) and
indemnification paid or made available to an officer, director or employee of
the Parent or any of its Subsidiaries for services rendered in that person's
capacity as an officer, director or employee or the making of any Distribution
or Investment otherwise permitted by this Agreement. For purposes of this
Section 5.02(k), Affiliate shall not include the Parent or any Wholly-Owned
Subsidiary of the Parent.
(l) Reserved
(m) Distributions. Directly or indirectly, declare, pay
or make any Distribution, or permit any Subsidiary to declare, pay or make any
Distribution, except (i) any Subsidiary (other than the Borrower) may declare
and make Distributions ratably to the holders of its Equity Interests and (ii)
if no Event of Default exists or would result, the Borrower may make
Distributions to the Parent.
(n) Investments. Make any Investment or permit any
Subsidiary to make any Investment except Permitted Investments.
(o) Asset Disposition. Sell, lease, transfer or otherwise
dispose of, or permit any Subsidiary to sell, lease, transfer or otherwise
dispose of, any property of the Parent or any Subsidiary, or permit any
Subsidiary to issue or cause to become outstanding any Equity Interest, except
(1) charters in the ordinary course of business, (2) dispositions of inventory
and worn-out or obsolete equipment in the ordinary course of business, (3)
dispositions of the Pride Illinois, Pride Kentucky, Pride West Virginia and/or
Pride Pennsylvania, and (4) so long as no Event of Default exists at the time of
any of the following and no Event of Default would result from any of the
following, (i) dispositions of property that (a) are described in the exception
to the definition of Asset Disposition set forth in clause (f) thereof or (b)
constitute Asset Dispositions in respect of which the Borrower is in compliance
with Section 2.04, (ii)
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any Land Rig Sale or Twin Oaks Sale, in each case, for Fair Market Value, if the
consideration therefor (in the aggregate for all dispositions under this clause
(ii)(x)) is either (a) solely cash or (b) Liquid Securities having a Fair Market
Value (determined, for each Liquid Securities received, as of the date received)
not exceeding 50% of the total aggregate consideration and cash, if, in the case
of this clause (b), the Parent would be in compliance with Sections 5.02(a) and
5.02(b) on a pro forma basis giving effect to such Land Rig Sale or disposition
of Equity Interests and if an Acceptable Security Interest is created in such
Liquid Securities (except that such Acceptable Security Interest shall not be
required if the creation thereof would result in adverse United States federal
income tax consequences), (iii) dispositions of property between the Parent and
a Subsidiary or between Subsidiaries, provided that if any Collateral or Opco
Loan Collateral is transferred in connection with any such disposition, the
Parent or such Subsidiary of the Parent who owns the Collateral or Opco Loan
Collateral after such transfer shall ratify and confirm the Lien on such
Collateral or Opco Loan Collateral and shall take all action reasonably
requested by the Collateral Agent to maintain an Acceptable Security Interest in
the Collateral (except that, if any Included Foreign Pledge Subsidiary ceases to
exist or ceases to be an Included Foreign Pledge Subsidiary as a part of such
disposition, the security interest contemplated herein in the Equity Interests
of such Included Foreign Pledge Subsidiary may (and, upon request from the
Borrower pursuant to the immediately following sentence, shall) be terminated
simultaneously with the creation of an Acceptable Security Interest in the
percentage of the Equity Interests of all Included Foreign Pledge Subsidiaries
existing upon consummation of such disposition that is contemplated in the
definition of "Collateral") and to preserve the mortgages securing the Opco Loan
in all respects, (iv) at the time of or after a Land Rig Sale or Twin Oaks Sale,
dispositions for cash and/or Liquid Securities by the Borrower or its
Subsidiaries to any Foreign Subsidiary, for Fair Market Value, of Collateral
with a Fair Market Value (in the aggregate for all dispositions under this
clause (iv)) of up to the lesser of (x) $425 million and (y) the cash proceeds
of all Land Rig Sales consummated prior thereto, (v) involuntary dispositions,
(vi) the issuance of Equity Interests to the Parent or a Subsidiary, (vii) the
issuance of Equity Interests by a Subsidiary to a Person other than the Parent
or another Subsidiary that, if treated as a disposition of a percentage of the
assets of the issuing Subsidiary equal to the percentage of all Equity Interests
of such Subsidiary represented by the Equity Interests so issued (on a fully
diluted basis), would be permitted by this Section 5.02(o), and (vii) other
sales of property (other than the Equity Interests of any Guarantor or any owner
of Collateral or Opco Loan Collateral) having an aggregate fair market value not
in excess of $5,000,000 in any year. Upon receipt of a written request therefor
from the Borrower, the Collateral Agent (in the case of clause (y) of this
sentence) or Administrative Agent (in the case of clause (z) of this sentence)
will execute and deliver, at the Borrower's expense, all documents as may
reasonably be requested to (y) effect a release of the Liens held by the
Collateral Agent (or if such Liens are held by the Collateral Trustee, the
Collateral Agent will instruct the Collateral Trustee to execute and deliver, at
the Borrower's expense, all such documents) pursuant to the Security Documents
on any Collateral disposed of (or otherwise permitted to be released) in
accordance with this Section 5.02(o) or (z) effect a release of a guaranty
granted in accordance with Article 8 of this Agreement by a Subsidiary the
Equity Interests of which have been disposed of in accordance with this Section
5.02(o).
(p) Capital Expenditures. Make, or permit any Subsidiary
to make, any Capital Expenditure other than Capital Expenditures not exceeding
$300,000,000 in the aggregate during any fiscal year of the Parent, provided
that this Section 5.02(p) shall not apply at any time that Liquidity is at least
$200,000,000 after giving effect to any such Capital Expenditure.
(q) Business. Engage, or permit any of its Subsidiaries
to engage, in any business other than the contract drilling business or a
business related, ancillary or complementary to the business of the Parent and
its Subsidiaries on the date hereof.
(r) Documents. Amend, waive, terminate or otherwise
modify, or agree to the amendment, waiver, termination or other modification of,
the charter, bylaws or other similar documents
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of the Parent or any Subsidiary, except (i) as part of a Permitted Restructuring
or (ii) if (a) all Liens on the Collateral are preserved in all respects as
Acceptable Security Interests, (b) the Forasub Loan, the Opco Loan and all
security for the Opco Loan are preserved in all respects, unless the Forasub
Loan and the Opco Loan have been paid in full, and (c) all such amendments,
waivers, terminations and other modifications, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
(s) Fiscal Period. Change its or any Subsidiary's
accounting policies or reporting practices, except as required by GAAP or law,
or change its or any Subsidiary's fiscal year or any fiscal quarter.
(t) Hedging. Enter into, or permit any Subsidiary to
enter into, any Hedging Agreement other than Hedging Agreements entered into for
bona fide hedging purposes (and not for speculative purposes) in the ordinary
course of the Parent's or a Subsidiary's business.
(u) Use of Proceeds. Use, or permit any Subsidiary to
use, the proceeds of any Advance for any purpose other than for general
corporate purposes of the Borrower (including to effect the Transactions (other
than the Tender Offer) and for loans and advances to the Parent and
Subsidiaries, to the extent not prohibited by any of the Credit Documents) or
use, or permit any Subsidiary to use, any such proceeds (i) in a manner which
violates or results in a violation of any law or regulation or any Credit
Document, (ii) to purchase or carry any margin stock (as defined in Regulation
U) or to extend credit to others for that purpose, (iii) to make any Investment
in any Person if such Investment is opposed by the board of directors, general
partner or other governing body of such Person or (iv) to consummate, or
otherwise make any payment in connection with, the Tender Offer.
(v) Designation of Non-Recourse Subsidiaries. Permit the
board of directors of the Parent to designate any Subsidiary as a Non-Recourse
Subsidiary, unless:
(i) Such Subsidiary is not, and does not and
will not own (directly or indirectly) any Equity Interest in, an Included
Foreign Pledge Subsidiary, the Borrower, a Guarantor or, unless the Forasub Loan
and the Opco Loan have been paid in full, an Opco Loan Party;
(ii) Neither the Parent nor any Subsidiary (other
than such Non-Recourse Subsidiary) is liable for any Debt or other obligation of
such Non-Recourse Subsidiary;
(iii) No default with respect to any Debt of such
Subsidiary would permit (upon notice, lapse of time or otherwise) any holder of
any Debt of the Parent or any Subsidiary (other than such Non-Recourse
Subsidiary) ("Other Debt") to declare a default on any Other Debt or cause the
payment thereof to be accelerated or payable prior to its stated maturity;
(iv) No Investment has been made in such
Subsidiary on or after the date hereof by the Parent or any other Subsidiary
except as set forth in clause (v) of the definition herein of Permitted
Investments; and
(v) Such Subsidiary does not and will not own,
directly or indirectly, any interest in the Forasub Loan, the Opco Loan, any
Collateral or any Opco Loan Collateral.
(w) Actions Relating to Non-Recourse Subsidiaries. Take
any action, or permit any Subsidiary to take any action, relating to any
Non-Recourse Subsidiary that, if such action had been taken immediately prior to
the designation of such Non-Recourse Subsidiary as a Non-Recourse Subsidiary,
would have resulted in such designation being prohibited by Section 5.02(v)
(including transferring any Collateral or Opco Collateral to such Non-Recourse
Subsidiary or any Subsidiary thereof, incurring any
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Debt that with a cross-default provision of the type referred to in Section
5.02(v)(iii), incurring liability for any Debt or other obligation of such
Non-Recourse Subsidiary or transferring to such Non-Recourse Subsidiary any
direct or indirect interest in any of the Persons referred to in Section
5.02(v)(i)).
(x) Secured Guarantees. Permit any Guarantor to guarantee
or otherwise be directly or indirectly liable for the Senior Notes or any other
Debt of another Person, unless such guarantee or liability, as the case may be,
is unsecured.
(y) Rigs. Fail, or permit any Subsidiary to fail, to be
the duly documented owner of, or qualified to own and operate, any rig that is
Collateral or Opco Loan Collateral under the laws of the jurisdiction of the
flag of such rig or under the laws of the jurisdiction of the location of such
rig, or permit any rig (including each Initial Rig) (i) to fail to remain in the
same class as it is in on the date hereof or, as to rigs acquired by the Parent
or a Subsidiary after the date hereof, in the same class as it was in on the
date of such acquisition, (ii) to enter any war zone, or (iii) to be used for
any unlawful purpose; provided, that this Section 5.02(y) shall not apply to an
action that the Parent or such Subsidiary determines (i) is desirable in the
conduct of the business of the Parent or such Subsidiary and is not
disadvantageous in any material respect to the Lenders, or (ii) could not
reasonably be expected, in the aggregate, to result in a Material Adverse
Effect. Upon receipt of a written request therefor from the Borrower, if any rig
that is Collateral is to be reflagged, the Collateral Agent will execute and
deliver, at the Borrower's expense, all documents as may reasonably be requested
to effect a release of the Liens on such rig held by the Collateral Agent (or if
such Liens are held by the Collateral Trustee, the Collateral Agent will
instruct the Collateral Trustee to execute and deliver, at the Borrower's
expense, all such documents) pursuant to the Security Documents under the
existing flag, provided that an Acceptable Security Interest in such rig is
created under the new flag.
(z) Forasub and Opco Loans. Permit the principal amount
of the Forasub Loan or the Opco Loan to be reduced below $100,000,000, unless
all payments and deposits required by Section 2.04 are made simultaneously with
such reduction.
(aa) Sale Leaseback Transactions. Enter into, or permit
any Subsidiary to enter into, any Sale Leaseback Transaction.
(bb) Note Guarantee. Permit any Foreign Subsidiary to
guarantee any obligation in connection with the 9.375% Notes or the 10% Notes.
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay (i) any principal of
any Advance when due, (ii) any amount payable pursuant to Section 2.18(c) when
due or (iii) any interest, commitment fee or other amount due hereunder or under
any other Credit Document to which it is a party for more than five days after
such interest, fee or other amount becomes due; or
(b) Any representation or warranty made by any Credit
Party (or any officer, agent or representative of any Credit Party) (including
representations and warranties deemed made pursuant to Section 3.02 or Section
3.03) in or in connection with any Credit Document shall prove to have been
incorrect in any material respect when made or deemed made; or
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(c) Any Credit Party (i) shall fail to perform or observe
any term, affirmative covenant or agreement contained in Section 5.01 or any
covenant in any other Credit Document and such failure shall remain unremedied
for 30 days after the earlier of (x) the date a Responsible Officer has
knowledge of such failure and (y) the date written notice thereof shall have
been given to the Borrower and the Administrative Agent by any Lender; or (ii)
shall fail to perform or observe any term, covenant or agreement contained
herein on its part to be performed or observed that is not covered by Section
6.01(a) or clause (i) of this Section 6.01(c); or
(d) Any Credit Party shall (i) fail to pay any principal
of or premium or interest on any Debt which is outstanding in the principal
amount of at least $50,000,000 in the aggregate, of such Credit Party, when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or (ii) default in the observance or
performance of any covenant or obligation contained in any agreement or
instrument relating to any such Debt or permit or suffer any other event to
occur or condition to exist under any agreement or instrument relating to any
such Debt, and such default or other event or condition shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect thereof is to accelerate, or to permit the acceleration of, the
maturity of such Debt or require such Debt to be prepaid prior to the stated
maturity thereof; or
(e) Any Credit Party shall generally not pay its debts as
such debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against any Credit Party seeking to
adjudicate it as bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), shall remain undismissed or
unstayed for a period of 60 days; or any Credit Party shall take any action to
authorize any of the actions set forth above in this Section 6.01(e); or
(f) One or more judgments, decrees or orders for the
payment of money aggregating in excess of $50,000,000 (net of such amounts
covered by independent third-party insurance as to which the insurer does not
dispute coverage) shall be rendered against any Credit Party and remain
unsatisfied and either (i) enforcement proceedings shall have been commenced by
any creditor upon any such judgment, decree or order or (ii) there shall be any
period of 60 consecutive days during which a stay of enforcement of any such
judgment, decree or order, by reason of a pending appeal or otherwise, shall not
be in effect; or
(g) Any Termination Event as defined in clause (b), (d)
or (e) of the definition thereof with respect to a Plan shall have occurred and,
30 days after notice thereof shall have been given to the Borrower by the
Administrative Agent, (i) such Termination Event shall still exist and (ii) the
sum (determined as of the date of occurrence of such Termination Event) of the
liabilities to the PBGC resulting from all such Termination Events is equal to
or greater than $50,000,000; or
(h) The Parent or any Subsidiary shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred Withdrawal Liability
to such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans in connection with Withdrawal
Liabilities (determined as of the date of such notification), exceeds
$50,000,000 or requires payments exceeding $50,000,000 in any year; or
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(i) The Parent or any Subsidiary shall have been notified
by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if as a result of such reorganization or termination the aggregate annual
contributions of the Parent and the Subsidiaries to all Multiemployer Plans
which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years which include the date hereof by an amount exceeding
$50,000,000 in the aggregate; or
(j) Any event occurs creating any ERISA Liabilities that
could reasonably be expected to result in a Material Adverse Effect and such
event is not cured within 30 days from the occurrence of such event;
(k) Any Change in Control occurs; or
(l) Any material provision of any Credit Document
executed by a Credit Party for any reason is not a legal, valid, binding and
enforceable obligation of such Credit Party or any Credit Party shall so state
in writing;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Majority Lenders, by notice to the Borrower,
declare the obligation of the Issuing Banks to issue Letters of Credit to be
terminated and the obligation of each Lender to make Advances to be terminated,
whereupon each such obligation and all of the Commitments shall forthwith
terminate, and (ii) shall at the request, or may with the consent, of the
Majority Lenders, by notice to the Borrower, declare the Advances, all interest
thereon and all other Obligations to be forthwith due and payable, whereupon the
Advances, all such interest and all other Obligations shall become and be
forthwith due and payable, without presentment, demand, protest, notice of
intent to accelerate, notice of acceleration or further notice of any kind, all
of which are hereby expressly waived by the Borrower and each Guarantor,
provided that in the event of an actual or deemed entry of an order for relief
with respect to the Borrower under the Bankruptcy Code, (a) the obligation of
the Issuing Banks to issue Letters of Credit, the obligation of each Lender to
make Advances and all of the Commitments shall automatically be terminated and
(b) the Advances, all such interest, all other Obligations and all amounts
contemplated by Section 6.02 shall automatically become and be due and payable,
without presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Borrower and each Guarantor. For purposes of this
Section 6.01, any Advance owed to an SPC shall be deemed to be owed to its
Designating Bank.
Section 6.02. L/C Cash Collateral Accounts. Upon the occurrence and
during the continuance of any Event of Default (if the Administrative Agent has
declared all amounts owed by the Borrower hereunder to be due and payable), the
Borrower agrees that it shall forthwith, without any demand or the taking of any
other action by the Issuing Banks, the Administrative Agent, or any of the
Lenders, provide cover for the outstanding Letter of Credit Liabilities in
respect of all Letters of Credit by paying to the Administrative Agent
immediately available funds in the amount equal to the then aggregate Letter of
Credit Liabilities of all outstanding Letters of Credit, which funds shall be
deposited into a blocked deposit account or accounts to be established and
maintained at the office of one or more of the Issuing Banks (or affiliates
thereof) in the name of the Administrative Agent as collateral security for all
Letter of Credit Liabilities (the "L/C Cash Collateral Account"). The Borrower
hereby pledges, and grants to the Administrative Agent for the ratable benefit
of the Lenders, a first priority security interest in all funds held in the L/C
Cash Collateral Account from time to time and all proceeds thereof, as security
for the payment of all Obligations. The Administrative Agent shall have sole
control over the L/C Cash Collateral Account and shall from time to time
withdraw funds then held in the L/C Cash Collateral Account to satisfy the
payment of the Obligations as shall have become or shall become due and payable
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under this Agreement. The Administrative Agent shall exercise reasonable care in
the custody and preservation of any funds held in the L/C Cash Collateral
Account and shall be deemed to have exercised such care if such funds are
accorded treatment substantially equivalent to that which the Administrative
Agent accords its own property, it being understood that the Administrative
Agent shall not have any responsibility for taking any necessary steps to
preserve rights against any parties with respect to any such funds or for
investing such funds.
Section 6.03. Application of Amounts Received Following the Occurrence
of an Event of Default. Upon the occurrence and during the continuance of any
Event of Default, any amounts received by the Administrative Agent, Collateral
Agent or Collateral Trustee from the Borrower, pursuant to the Security
Documents or from a Guarantor in connection with its guaranty of the
Obligations, shall be applied to the Obligations in the following order of
priority:
(i) first, to the payment of all costs, expenses and other
unreimbursed amounts (other than principal and interest on the
Advances and Demand Loans), including but not limited to
amounts due with respect to indemnity obligations, owed by the
Credit Parties to the Administrative Agent, Collateral Agent,
and Collateral Trustee, ratably in accordance with such
respective costs, expenses and other unreimbursed amounts then
owing to the Administrative Agent, Collateral Agent, and
Collateral Trustee;
(ii) second, to Letter of Credit issuance fees, costs, expenses and
commissions pursuant to Section 2.18(b) and fees and interest
on all Advances and Demand Loans, ratably in accordance with
such respective amounts then owing to the Issuing Banks and
Lenders;
(iii) third, (a) to the payment of principal on all Advances and
Demand Loans, (b) to the extent any Letter of Credit has not
been fully cash collateralized pursuant to Section 6.02
hereof, cash collateralization of Letters of Credit, and (c)
to the payment of all Other Obligations, ratably to each
Lender, Issuing Bank and Secured Hedge Provider based on its
respective Ratable Sharing Percentage on the date of such
payment. With respect to Obligations that are not then
payable, any amount reserved pursuant to this Section 6.03
shall be deposited in a Collateral Account until such time or
times as such Obligations become payable, or the obligees
under such Obligations notify the Administrative Agent that
there are no remaining liability under such Obligations; and
after such payment or notice, any surplus reserved amount, to
the extent not applied to such Obligations, shall be available
for distribution in accordance with the priority established
in this Section 6.03; and
(iv) fourth, any surplus of such amounts remaining after payment in
full in cash of all the Obligations, the termination or cash
collateralization of all Letters of Credit and Commitments,
and the settlement or other termination of all Other
Obligations shall be paid over to the Borrower, or whomever
may be lawfully entitled to receive such surplus, in a
commercially reasonable time, provided that none of the Lender
Parties shall be liable for any interest, cost or expense in
connection with any delay in delivering such proceeds to the
Borrower or other Person.
ARTICLE VII
THE ADMINISTRATIVE AGENT AND THE ISSUING BANKS
Section 7.01. Authorization and Action. Each Lender hereby appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under the
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Credit Documents as are delegated to the Administrative Agent, by the terms
hereof and thereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by the Credit
Documents (including enforcement or collection of the Notes), the Administrative
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Majority
Lenders, and such instructions shall be binding upon all Lenders and all holders
of Notes; provided that the Administrative Agent shall not be required to take
any action which exposes the Administrative Agent to personal liability or which
is contrary to any Credit Document or applicable law and shall not be required
to initiate or conduct any litigation or other proceedings. The Administrative
Agent agrees to give to each Lender prompt notice of each notice given to it by
the Borrower pursuant to the terms of this Agreement.
Section 7.02. Administrative Agent's Reliance, Etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with any Credit Document, except for its or their own gross
negligence or willful misconduct. The duties of the Administrative Agent shall
be mechanical and administrative in nature; the Administrative Agent shall not
have, by reason of this Agreement or any other Credit Document a fiduciary
relationship in respect of any Lender or the holder of any Note; and nothing in
this Agreement or any other Credit Document, expressed or implied, is intended
or shall be so construed as to impose upon the Administrative Agent any
obligations in respect of this Agreement or any other Credit Document except as
expressly set forth herein. Without limitation of the generality of the
foregoing, the Administrative Agent: (i) may treat the payee of any Note as the
holder thereof until the Administrative Agent receives and accepts a Transfer
Agreement entered into by the Lender that is the payee of such Note, as
assignor, and an Eligible Assignee, as assignee, as provided in Section 10.06;
(ii) may consult with legal counsel (including counsel for any Credit Party),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (iii) makes
no warranty or representation to any Lender and shall not be responsible to any
Lender for any statements, warranties or representations (whether written or
oral) made in or in connection with any Credit Document or any other instrument
or document furnished pursuant hereto or in connection herewith; (iv) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Credit Document or any other
instrument or document furnished pursuant hereto or in connection herewith on
the part of the Borrower or any other Person or to inspect the property
(including the books and records) of the Borrower or any other Person; (v) shall
not be responsible for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Credit Document or any other instrument
or document furnished pursuant hereto or in connection herewith or for the
perfection, existence, sufficiency or value of any Collateral, any guaranty or
any insurance; and (vi) shall incur no liability under or in respect of any
Credit Document, except for its own gross negligence or willful misconduct, by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopier, telegram, cable or telex) believed by it to be
genuine and signed, given or sent by the proper party or parties. Without
limiting the generality of the foregoing, insofar as the Administrative Agent is
concerned, with respect to any Advance, each Lender shall be deemed to have
consented to, approved and be satisfied with each matter referred to in Article
III, unless the officer of the Administrative Agent responsible for the
transactions contemplated by the Credit Documents shall have received written
notice from such Lender prior to such Advance specifying its objection thereto
and such Lender shall not have made available to the Administrative Agent any
portion of such Advance; provided that this sentence is solely for the benefit
of the Administrative Agent (and not any Credit Party) and shall not amend,
waive or otherwise modify Article III, Section 6.01(b) or any other provision
applicable to any Credit Party, whether in respect of such Advance or any other
Advance or matter.
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Section 7.03. Administrative Agent and Its Affiliates. With respect to
its Commitment, the Advances made by it and the Notes issued to it, each Lender
which is also the Administrative Agent shall have the same rights and powers
under the Credit Documents as any other Lender and may exercise the same as
though it were not the Administrative Agent; and the term "Lender" or "Lenders"
shall, unless otherwise expressly indicated, include any Lender serving as the
Administrative Agent in its individual capacity. Any Lender serving as the
Administrative Agent and its affiliates may accept deposits from, lend money to,
act as trustee under indentures of, accept investment banking engagements from
and generally engage in any kind of business with, the Parent, any of the
Subsidiaries and any Person who may do business with or own securities of the
Parent or any Subsidiary, all as if such Lender were not the Administrative
Agent and without any duty to account therefor to the Lenders.
Section 7.04. Lender Credit Decision. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on the financial statements referred to in Section
4.01(d) and such other documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and the
other Credit Documents. The Administrative Agent shall not have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or the holder of any Note with any credit or other information with respect
thereto, whether coming into its possession before the making of the Advances or
at any time or times thereafter.
Section 7.05. Certain Rights of the Administrative Agent. If the
Administrative Agent shall request instructions from the Majority Lenders with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Majority Lenders;
and it shall not incur liability to any Person by reason of so refraining.
Without limiting the foregoing, no Lender nor the holder of any Note shall have
any right of action whatsoever against the Administrative Agent as a result of
its acting or refraining from acting hereunder or under any other Credit
Document in accordance with the instructions of the Majority Lenders or all of
the Lenders, as the case may be. Furthermore, except for action expressly
required of the Administrative Agent hereunder, the Administrative Agent shall
in all cases be fully justified in failing or refusing to act hereunder unless
it shall be specifically indemnified to its satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action.
Section 7.06. Holders. Any request, authority or consent of any Person
who, at the time of making such request or giving such authority or consent, is
the holder of any Note shall be conclusive and binding on any subsequent holder,
transferee, assignee or endorsee, as the case may be, of such Note or of any
Note or Notes issued in exchange therefor.
Section 7.07. Indemnification. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed by the Borrower), ratably
according to the respective principal amounts of the Advances then held by each
of them (or if no principal of the Advances is at the time outstanding, ratably
according to the respective amounts of their Revolving Commitments then
existing, or, if no such principal amounts are then outstanding and no Revolving
Commitments are then existing, ratably according to the respective amounts of
the Revolving Commitments existing immediately prior to the termination
thereof), from and against any and all claims, damages, losses, liabilities and
expenses (including reasonable fees and disbursements of counsel) of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against the
Administrative Agent in any way relating to or arising
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out of any of the Credit Documents or any action taken or omitted by the
Administrative Agent under the Credit Documents (EXPRESSLY INCLUDING ANY SUCH
CLAIM, DAMAGE, LOSS, LIABILITY OR EXPENSE ATTRIBUTABLE TO THE ORDINARY, SOLE OR
CONTRIBUTORY NEGLIGENCE OF THE ADMINISTRATIVE AGENT, BUT EXCLUDING ANY SUCH
CLAIM, DAMAGE, LOSS, LIABILITY OR EXPENSE ATTRIBUTABLE TO THE GROSS NEGLIGENCE
OR WILLFUL MISCONDUCT OF THE ADMINISTRATIVE AGENT). IT IS THE INTENT OF THE
PARTIES HERETO THAT THE ADMINISTRATIVE AGENT SHALL, TO THE EXTENT PROVIDED IN
THIS SECTION 7.07, BE INDEMNIFIED FOR ITS OWN ORDINARY, SOLE OR CONTRIBUTORY
NEGLIGENCE. Without limitation of the foregoing, each Lender agrees to reimburse
the Administrative Agent promptly upon demand for such Lender's ratable share of
any reasonable out-of-pocket expenses (including reasonable counsel fees)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, the Credit Documents, or
any of them, to the extent that the Administrative Agent is not reimbursed for
such expenses by the Borrower.
Section 7.08. Resignation by the Administrative Agent. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and under the other Credit Documents at any time by giving 15
Business Days' prior written notice to the Borrower and the Lenders. Such
resignation shall take effect upon the appointment of a successor Administrative
Agent pursuant to clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Majority
Lenders shall have the right to appoint a successor Administrative Agent which
shall be a commercial bank or trust company that is, if no Event of Default
exists, reasonably acceptable to the Borrower.
(c) If a successor to a resigning Administrative Agent
shall not have been so appointed within such 15 Business Day period, the
resigning Administrative Agent, with the consent of the Borrower if no Event of
Default exists (which consent will not be unreasonably withheld), shall have the
right to then appoint a successor Administrative Agent who shall serve as
Administrative Agent until such time, if any, as the Majority Lenders appoint a
successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been
appointed pursuant to clause (b) or (c) above and shall have accepted such
appointment by the 20th Business Day after the date such notice of resignation
was given by the resigning Administrative Agent, the resigning Administrative
Agent's resignation shall become effective and the Lenders shall thereafter
perform all the duties of the resigning Administrative Agent hereunder and under
any other Credit Document until such time, if any, as the Majority Lenders
appoint a successor Administrative Agent as provided above.
(e) After any Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article VII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement.
Section 7.09. Issuing Banks' Reliance, Etc. Neither the Issuing Banks
nor any of their directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it or them under or in connection
with any Credit Document, except for its or their own gross negligence or
willful misconduct. The Issuing Banks shall not have, by reason of this
Agreement or any other Credit Document a fiduciary relationship in respect of
any Lender or the holder of any Note; and nothing in this Agreement or any other
Credit Document, expressed or implied, is intended or shall be so construed as
to impose upon the Issuing Banks any obligations in respect of this Agreement or
any other Credit Document except as expressly set forth herein. Without
limitation of the generality of the foregoing, each Issuing Bank: (i) may treat
the payee of any Note as the holder thereof until such Issuing Bank receives a
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Transfer Agreement entered into by the Lender that is payee of such Note, as
assignor, and an Eligible Assignee, as assignee, as provided in Section 10.06,
(ii) may consult with legal counsel (including counsel for any Credit Party),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (iii) makes
no warranty or representation to any Lender and shall not be responsible to any
Lender for any statements, warranties or representations (whether written or
oral) made in or in connection with any Credit Document or any other instrument
or document furnished pursuant hereto or in connection herewith; (iv) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Credit Document or any other
instrument or document furnished pursuant hereto or in connection herewith on
the part of the Borrower or any other Person or to inspect the property
(including the books and records) of the Borrower or any other Person; (v) shall
not be responsible for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Credit Document or any other instrument
or document furnished pursuant hereto or in connection herewith or for the
perfection, existence, sufficiency or value of any Collateral, any guaranty or
any insurance; and (vi) shall incur no liability under or in respect of any
Credit Document, except for its own gross negligence or willful misconduct, by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopier, telegram, cable or telex) believed by it to be
genuine and signed, given or sent by the proper party or parties.
Section 7.10. Issuing Banks and Their Affiliates. With respect to its
Commitment, the Advances made by it and the Notes issued to it, each Lender
which is also an Issuing Bank shall have the same rights and powers under the
Credit Documents as any other Lender and may exercise the same as though it were
not an Issuing Bank; and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated, include any Lender serving as an Issuing Bank in its
individual capacity. Any Lender serving as an Issuing Bank and its affiliates
may accept deposits from, lend money to, act as trustee under indentures of,
accept investment banking engagements from and generally engage in any kind of
business with, the Parent, any of the Subsidiaries and any Person who may do
business with or own securities of the Parent or any Subsidiary, all as if such
Lender were not an Issuing Bank and without any duty to account therefor to the
Lenders.
Section 7.11. Lender Credit Decision. Each Lender acknowledges that it
has, independently and without reliance upon the Issuing Banks or any other
Lender and based on the financial statements referred to in Section 4.01(d) and
such other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Issuing
Banks or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Credit Documents.
The Issuing Banks shall not have any duty or responsibility, either initially or
on a continuing basis, to provide any Lender or the holder of any Note with any
credit or other information with respect thereto, whether coming into its
possession before the making of the Advances or at any time or times thereafter.
ARTICLE VIII
THE GUARANTY
Section 8.01. Guaranty. Subject to Section 8.11, each Guarantor hereby
severally, unconditionally and irrevocably guarantees the punctual payment when
due, whether at stated maturity, by acceleration or otherwise, of the
Obligations. Without limiting the generality of the foregoing, each Guarantor's
liability shall extend to all amounts which constitute part of the Obligations
even if such Obligations are declared unenforceable or not allowable in a
bankruptcy, reorganization, or similar proceeding involving any Credit Party or
any other Person. The foregoing guaranty is a guaranty of payment, not of
collection, and each Guarantor is primarily liable for the payment of the
Obligations.
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Section 8.02. Limit of Liability. The liabilities and obligations of
each Guarantor under the Credit Documents shall be limited to an aggregate
amount equal to the largest amount that would not render such Guarantor's
liabilities and obligations hereunder and thereunder subject to avoidance under
Section 548 of the United States Bankruptcy Code or any comparable provisions of
any applicable state law after giving effect to all other indebtedness of such
Guarantor, the right of each such Guarantor to contribution from other
Guarantors and any other rights such Guarantor may have.
Section 8.03. Guaranty Absolute. Each Guarantor severally,
unconditionally and irrevocably guarantees that the Obligations will be paid
strictly in accordance with the Credit Documents, regardless of any law,
regulation, or order now or hereafter in effect in any jurisdiction affecting
any of the Obligations or the rights of any Person with respect thereto. The
obligations of each Guarantor hereunder are independent of the obligations of
any other Person in respect of the Obligations, and a separate action or actions
may be brought and prosecuted against any Person regardless of whether any other
Person is joined in any such action or actions. The liability of each Guarantor
hereunder shall be absolute and unconditional irrespective of:
(a) The lack of validity or unenforceability of the
Obligations or any Credit Document for any reason whatsoever, including that the
act of creating the Obligations is ultra ▇▇▇▇▇, that the officers or
representatives executing the documents creating the Obligations exceeded their
authority, that the Obligations violate usury or other laws, or that any Credit
Party has defenses to the payment of the Obligations, including breach of
warranty, statute of frauds, bankruptcy, statute of limitations, lender
liability, or accord and satisfaction;
(b) Any change in the time, manner, or place of payment
of, or in any term of, any of the Obligations, any increase, reduction,
extension, or rearrangement of the Obligations, any amendment, supplement, or
other modification of the Credit Documents, or any waiver or consent granted
under the Credit Documents, including waivers of the payment and performance of
the Obligations;
(c) Any release, exchange, subordination, waste, or other
impairment (including negligent, willful, unreasonable, or unjustifiable
impairment) of any collateral securing payment of the Obligations; the failure
of Collateral Agent, the Collateral Trustee or any other Person to exercise
diligence or reasonable care in the preservation, protection, enforcement, sale,
or other handling of any such collateral; or the fact that any Lien related to
any collateral for the Obligations shall not be properly perfected, or shall
prove to be unenforceable or subordinate to any other Lien;
(d) Any full or partial release of any Credit Party or
any collateral;
(e) The failure to apply or the manner of applying any
collateral or payments of the proceeds of any collateral against the
Obligations;
(f) Any change in the organization or structure of any
Credit Party; any change in the shareholders, directors, or officers of any
Credit Party; or the insolvency, bankruptcy, liquidation, or dissolution of any
Credit Party or any defense that may arise in connection with or as a result of
any such insolvency, bankruptcy, liquidation or dissolution;
(g) The failure to give notice of any extension of credit
made under any Credit Document, notice of acceptance of the guaranty set forth
in this Article VIII, notice of any amendment, supplement, or other modification
of any Credit Document, notice of the execution of any document or agreement
creating Obligations, notice of any default or event of default, however
denominated, under the Credit Documents, notice of intent to demand, notice of
demand, notice of presentment for payment,
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notice of nonpayment, notice of intent to protest, notice of protest, notice of
grace, notice of dishonor, notice of intent to accelerate, notice of
acceleration, notice of bringing of suit, notice of any transfer of the
Obligations, notice of the financial condition of or other circumstances
regarding any Credit Party, or any other notice of any kind relating to the
Obligations;
(h) Any payment or grant of collateral by any Credit
Party to the Collateral Agent, the Collateral Trustee or any other Person being
held to constitute a preference, fraudulent obligation or fraudulent transfer
under bankruptcy laws, or for any reason the Collateral Agent, the Collateral
Trustee or any other Person is required to refund such payment or release such
collateral;
(i) Any other action taken or omitted which affects the
Obligations, whether or not such action or omission prejudices any Guarantor or
increases the likelihood that any Guarantor will be required to pay the
Obligations pursuant to the terms hereof;
(j) The fact that all or any of the Obligations cease to
exist by operation of law, including by way of discharge, limitation or tolling
thereof under applicable bankruptcy laws; and
(k) Any other circumstances which might otherwise
constitute a defense available to, or a discharge of, any Credit Party.
Section 8.04. Waiver of Notice and Other Remedies. Guarantor hereby
waives promptness, diligence, notice of acceptance, notice of acceleration,
notice of intent to accelerate, and any other notice with respect to any of the
Obligations and the guaranty set forth herein and any requirement that the
Collateral Agent, the Collateral Trustee or any other Person protect, secure,
perfect or insure any security interest or other Lien or any property subject
thereto or exhaust any right to take any action against any Credit Party or any
other Person or any collateral.
Section 8.05. Waiver of Subrogation and Contribution. Until such time
as the Obligations are irrevocably paid in full and all Letters of Credit and
Commitments are terminated, each Guarantor hereby irrevocably waives any claim
or other rights that it may acquire against any Credit Party that arise from
such Guarantor's obligations under this Article VIII or any other Credit
Document, including any right of subrogation, reimbursement, exoneration,
contribution, indemnification, or any right to participate in any claim or
remedy of the Collateral Agent or any other Lender Party against any Credit
Party, or any collateral that the Collateral Agent or any other Lender Party now
has or acquires. If any amount shall be paid to any Guarantor in violation of
the preceding sentence, such amount shall be held in trust for the benefit of
the Collateral Agent and the Lender Parties, and shall promptly be paid to the
Collateral Agent for the benefit of Collateral Agent and the other Lender
Parties to be applied to the Obligations, whether matured or unmatured, as the
Collateral Agent may elect. Each Guarantor that makes a payment or distribution
under its guarantee hereunder will be entitled to a contribution from each other
Guarantor in a pro rata amount based on the Adjusted Net Assets of each
Guarantor. Each Guarantor acknowledges that it will receive direct and indirect
benefits from the financing arrangements contemplated by the Credit Documents
and that the waiver set forth in this Section 8.05 is knowingly made.
Section 8.06. Reinstatement. Each Guarantor agrees that, to the extent
that the Borrower or other Guarantor makes any payment under any Credit Document
or the Collateral Agent or any other Lender Party receives any proceeds of
collateral, and such payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside, or otherwise
required to be repaid, then to the extent of such repayment, the Obligations
shall be reinstated and continued in full force and effect as of the date such
initial payment or collection of proceeds occurred.
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Section 8.07. Exercise of Remedies. The Collateral Agent shall have the
right to make demands, file suits and claims, engage in other proceedings and
exercise any other rights or remedies available to the Collateral Agent to
collect amounts owed pursuant to the terms of this Article VIII, and the
Collateral Agent shall not need the consent of any other Lender Party or Person
to do so.
Section 8.08. Modifications and Amendment to the Credit Documents. Each
amendment, waiver or consent effected in accordance with Section 10.01 shall be
binding on each Guarantor whether or not any Guarantor is a party thereto.
Section 8.09. Representations, Warranties and Covenants. Each Guarantor
hereby represents and warrants that each representation or warranty contained in
Article IV is true and correct to the extent such representation or warranty
pertains to it or to any of its Subsidiaries. Each Guarantor hereby agrees to
comply, and to cause each of its Subsidiaries to comply, with each provision of
Article V that pertains to it or its Subsidiaries.
Section 8.10. Continuing Guaranty; Assignments. The guaranty set forth
in this Article VIII is a continuing guaranty and shall (a) remain in full force
and effect until the indefeasible payment in full of the Obligations and
termination of all Letters of Credit and the Commitments, (b) be binding upon
each Guarantor and its respective successors and assigns, (c) inure to the
benefit of each of the Lender Parties and their respective successors,
transferees and permitted assigns, and (d) not be terminated by any Guarantor or
any other Person. This Agreement is not assignable by any Guarantor.
Section 8.11. No Guarantee of Indenture Issuer Obligations.
Notwithstanding anything to the contrary, no provision of this Agreement or any
other Credit Document shall require any Guarantor that is a Subsidiary of the
Person that is the issuer of the existing Debt under the Indenture dated as of
May 1, 1997 between the Parent and ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, as trustee, or the
Senior Notes (on the date hereof, such Person being the Existing Parent), or any
successor or assign of such Person (other than the Borrower or any other Credit
Party) with respect to such Debt, to guarantee or otherwise be liable, directly
or indirectly, for any obligation of such Person under any Credit Document.
Section 8.12. Parallel Obligations. Any discharge of a Parallel
Obligations (as defined in the Dutch Deed of Pledge of Shares), in full or in
part, shall to the same extent decrease the obligations pursuant to the
Principal Obligations (as defined in the Dutch Deed of Pledge of Shares) to
which it corresponds.
ARTICLE IX
THE COLLATERAL AGENT
Section 9.01. Authorization and Action. Each of the Lenders and the
Issuing Banks hereby appoints and authorizes the Collateral Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Documents as are delegated to the Collateral Agent, by the terms hereof and
thereof, together with such powers and discretion as are reasonably incidental
thereto. As to any matters not expressly provided for by the Credit Documents,
the Collateral Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Majority Lenders, and such instructions shall be binding upon all Lenders,
all other beneficiaries of any Security Document and all holders of Notes;
provided that the Collateral Agent shall not be required to take any action
which exposes the Collateral Agent to personal liability or which is contrary to
any Credit Document or applicable law and shall not be required to initiate or
conduct any litigation or other proceedings. Each Lender agrees that the Person
acting as Collateral Agent shall be Trustee under the Master Vessel and
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Trust Agreement entered into between the Collateral Agent and the Trustee in
respect of the Initial Rigs subject to Vessel Mortgages. The Collateral Agent
agrees to give to each Lender prompt notice of each notice given to it by the
Borrower pursuant to the terms of this Agreement.
Section 9.02. Collateral Agent's Reliance, Etc. Neither the Collateral
Agent nor any of its directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them under or in connection
with any Credit Document, except for its or their own gross negligence or
willful misconduct. The duties of the Collateral Agent shall be mechanical and
administrative in nature; the Collateral Agent shall not have, by reason of this
Agreement or any other Credit Document a fiduciary relationship in respect of
any Lender, any other beneficiary of any Security Document or the holder of any
Note; and nothing in this Agreement or any other Credit Document, expressed or
implied, is intended or shall be so construed as to impose upon the Collateral
Agent any obligations in respect of this Agreement or any other Credit Document
except as expressly set forth herein. Without limitation of the generality of
the foregoing, the Collateral Agent: (i) may treat the payee of any Note as the
holder thereof until the Collateral Agent receives a Transfer Agreement entered
into by the Lender that is the payee of such Note, as assignor, and an Eligible
Assignee, as assignee, as provided in Section 10.06; (ii) may consult with legal
counsel (including counsel for any Credit Party), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (iii) makes no warranty or representation to
any Lender or any other beneficiary of any Security Document and shall not be
responsible to any Lender or any other beneficiary of any Security Document for
any statements, warranties or representations (whether written or oral) made in
or in connection with any Credit Document or any other instrument or document
furnished pursuant hereto or in connection herewith; (iv) shall not have any
duty to ascertain or to inquire as to the performance or observance of any of
the terms, covenants or conditions of any Credit Document or any other
instrument or document furnished pursuant hereto or in connection herewith on
the part of the Borrower or any other Person or to inspect the property
(including the books and records) of the Borrower or any other Person; (v) shall
not be responsible for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of any Credit Document or any other instrument
or document furnished pursuant hereto or in connection herewith or for the
perfection, existence, sufficiency or value of any Collateral, any guaranty or
any insurance; and (vi) shall incur no liability under or in respect of any
Credit Document, except for its own gross negligence or willful misconduct, by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopier, telegram, cable or telex) believed by it to be
genuine and signed, given or sent by the proper party or parties.
Section 9.03. Collateral Agent and Its Affiliates. With respect to its
Commitment, the Advances made by it and the Notes issued to it, each Lender
which is also the Collateral Agent shall have the same rights and powers under
the Credit Documents as any other Lender and may exercise the same as though it
were not the Collateral Agent; and the term "Lender" or "Lenders" shall, unless
otherwise expressly indicated, include any Lender serving as the Collateral
Agent in its individual capacity. Any Lender serving as the Collateral Agent and
its affiliates may accept deposits from, lend money to, act as trustee under
indentures of, accept investment banking engagements from and generally engage
in any kind of business with, the Parent, any of the Subsidiaries and any Person
who may do business with or own securities of the Parent or any Subsidiary, all
as if such Lender were not the Collateral Agent and without any duty to account
therefor to the Lenders.
Section 9.04. Lender Credit Decision. Each of the Lenders and the other
beneficiaries of any Security Document (both on its own behalf and on behalf of
any of its Affiliates that is a beneficiary of any Security Document)
acknowledges that it has, independently and without reliance upon the Collateral
Agent or any other Lender and based on the financial statements referred to in
Section 4.01(d) and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision
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to enter into this Agreement. Each of the Lenders and the other beneficiaries of
any Security Document (both on its own behalf and on behalf of any of its
Affiliates that is a beneficiary of any Security Document) also acknowledges
that it will, independently and without reliance upon the Collateral Agent or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement and the other Credit Documents. The
Collateral Agent shall not have any duty or responsibility, either initially or
on a continuing basis, to provide any Person or the holder of any Note with any
credit or other information with respect thereto, whether coming into its
possession before the making of the Advances or at any time or times thereafter.
Section 9.05. Certain Rights of the Collateral Agent. If the Collateral
Agent shall request instructions from the Majority Lenders with respect to any
act or action (including failure to act) in connection with this Agreement or
any other Credit Document, the Collateral Agent shall be entitled to refrain
from such act or taking such action unless and until the Collateral Agent shall
have received instructions from the Majority Lenders; and it shall not incur
liability to any Person by reason of so refraining. Without limiting the
foregoing, no Lender nor any beneficiary of any Security Document nor the holder
of any Note shall have any right of action whatsoever against the Collateral
Agent as a result of its acting or refraining from acting hereunder or under any
other Credit Document in accordance with the instructions of the Majority
Lenders or all of the Lenders, as the case may be. Furthermore, except for
action expressly required of the Collateral Agent hereunder, the Collateral
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall be specifically indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action.
Section 9.06. Holders. Any request, authority or consent of any Person
who, at the time of making such request or giving such authority or consent, is
the holder of any Note shall be conclusive and binding on any subsequent holder,
transferee, assignee or endorsee, as the case may be, of such Note or of any
Note or Notes issued in exchange therefor.
Section 9.07. Indemnification. The Lenders agree to indemnify the
Collateral Agent (to the extent not reimbursed by the Borrower), ratably
according to the respective principal amounts of the Advances then held by each
of them (or if no principal of the Advances is at the time outstanding, ratably
according to the respective amounts of their Revolving Commitments then
existing, or, if no such principal amounts are then outstanding and no Revolving
Commitments are then existing, ratably according to the respective amounts of
the Revolving Commitments existing immediately prior to the termination
thereof), from and against any and all claims, damages, losses, liabilities and
expenses (including reasonable fees and disbursements of counsel) of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against the
Collateral Agent in any way relating to or arising out of any of the Credit
Documents or any action taken or omitted by the Collateral Agent under the
Credit Documents (EXPRESSLY INCLUDING ANY SUCH CLAIM, DAMAGE, LOSS, LIABILITY OR
EXPENSE ATTRIBUTABLE TO THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF THE
COLLATERAL AGENT, BUT EXCLUDING ANY SUCH CLAIM, DAMAGE, LOSS, LIABILITY OR
EXPENSE ATTRIBUTABLE TO THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE
COLLATERAL AGENT). IT IS THE INTENT OF THE PARTIES HERETO THAT THE COLLATERAL
AGENT SHALL, TO THE EXTENT PROVIDED IN THIS SECTION 9.07, BE INDEMNIFIED FOR ITS
OWN ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE. Without limitation of the
foregoing, each Lender agrees to reimburse the Collateral Agent promptly upon
demand for such Lender's ratable share of any reasonable out-of-pocket expenses
(including reasonable counsel fees) incurred by the Collateral Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities
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under, the Credit Documents, or any of them, to the extent that the Collateral
Agent is not reimbursed for such expenses by the Borrower.
Section 9.08. Resignation by the Collateral Agent. (a) The Collateral
Agent may resign from the performance of all its functions and duties hereunder
and under the other Credit Documents at any time by giving 15 Business Days'
prior written notice to the Borrower and the Lenders. Such resignation shall
take effect upon the appointment of a successor Collateral Agent pursuant to
clauses (b) and (c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Majority
Lenders shall have the right to appoint a successor Collateral Agent which shall
be a commercial bank or trust company that is, if no Event of Default exists,
reasonably acceptable to the Borrower.
(c) If a successor to a resigning Collateral Agent shall
not have been so appointed within such 15 Business Day period, the resigning
Collateral Agent, with the consent of the Borrower if no Event of Default exists
(which consent will not be unreasonably withheld), shall have the right to then
appoint a successor Collateral Agent who shall serve as Collateral Agent until
such time, if any, as the Majority Lenders appoint a successor Collateral Agent
as provided above.
(d) If no successor Collateral Agent has been appointed
pursuant to clause (b) or (c) above and shall have accepted such appointment by
the 20th Business Day after the date such notice of resignation was given by the
resigning Collateral Agent, the resigning Collateral Agent's resignation shall
become effective and the Lenders shall thereafter perform all the duties of the
resigning Collateral Agent hereunder and under any other Credit Document until
such time, if any, as the Majority Lenders appoint a successor Collateral Agent
as provided above.
(e) After any Collateral Agent's resignation hereunder as
Collateral Agent, the provisions of this Article IX shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was Collateral
Agent under this Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.01. Amendments, Etc. No amendment or waiver of any provision
of any Credit Document, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Majority Lenders and the Borrower, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided that no amendment, waiver or consent shall, unless in
writing and signed by all the Lenders, do any of the following: (a) waive any of
the conditions specified in Section 3.01, (b) increase any Commitment of any
Lender or subject any Lender to any additional obligation, (c) forgive or reduce
the principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (d) postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable hereunder, (e) take
any action which requires the signing of all the Lenders pursuant to the terms
of any Credit Document, (f) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes which shall be required for the
Lenders or any of them to take any action under any Credit Document, (g) amend
this Section 10.01, (h) release any Guarantor or all or substantially all of the
Collateral (except as contemplated by this Agreement), (i) change the
definitions herein of Ratable Revolving Percentage or Majority Lenders, (j)
change the mandatory prepayment events or the order of application of any
prepayment of Advances from that set forth in Section 2.04, or change the
provisions for pro rata payments, pro rata sharing or other pro rata treatment
of the Lenders (including the order of application of collateral proceeds set
forth in Section 6.03), or (k) change the rights or duties (including
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rights to payment) under any Credit Document of the Revolving Lenders (but not
the Term Lenders) or of the Term Lenders (but not the Revolving Lenders); and
provided further that (v) no amendment, waiver or consent shall, unless in
writing and signed by the Guarantors, in addition to the other Persons required
herein to take such action, amend Article VIII, (w) no amendment, waiver or
consent shall, unless in writing and signed by the Issuing Banks in addition to
the other Persons required herein to take such action, affect the rights or
duties of the Issuing Banks under any Credit Document, (x) no amendment, waiver
or consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required herein to take such action, affect the rights
or duties of the Administrative Agent under any Credit Document, (y) no
amendment, waiver or consent shall, unless in writing and signed by the
Collateral Agent or the Collateral Trustee in addition to the other Persons
required herein to take such action, affect the rights or duties of the
Collateral Agent or the Collateral Trustee, as the case may be, under the Credit
Documents, and (z) no amendment, waiver or consent shall, unless in writing and
signed by the Swingline Lenders in addition to the other Persons required herein
to take such action, affect the rights of duties of the Swingline Lenders under
the Credit Documents.
Section 10.02. Notices, Etc. Except as otherwise provided in this
Section 10.02, all notices and other communications provided for hereunder shall
be in writing (including telecopier communication) and mailed, telecopied, or
delivered, if to the Borrower or any Guarantor, at its address or telecopier
number set forth below its signature hereto; if to any Lender, at its Domestic
Lending Office; if to the Administrative Agent, at its address or telecopier
number set forth below:
Citicorp North America, Inc.
▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Email address: ▇▇▇▇▇▇▇.▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
if to the Collateral Agent, at its address or telecopier number set forth below:
Citibank, N. A.
Global Corporate & Investment Banking Group
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Email address: ▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
if to one or more Issuing Bank, at its address or telecopier number set forth
below:
Calyon New York Branch
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ---------------------
Telecopier No.: ----------------
Email address: -----------------
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Natexis Banques Populaires
333 Clay St., Suite #: 4340
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telecopier No.: ----------------
Email address: -----------------
if to one or more Swingline Lenders, at its address or telecopier number set
forth below:
Calyon New York Branch
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ---------------------
Telecopier No.: ----------------
Email address: -----------------
Natexis Banques Populaires
▇▇▇ ▇▇▇▇ ▇▇., Suite #: 4340
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telecopier No.: ----------------
Email address: -----------------
or, as to any Credit Party, the Administrative Agent, the Collateral Agent, a
Swingline Lender or an Issuing Bank, at such other address as shall be
designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower, the Administrative Agent, the Collateral
Agent, the Swingline Lenders and the Issuing Banks, provided, further, that any
communication that (A) relates to a request for a new, or a Conversion or
continuation of an existing Advance, a new Letter of Credit, any increase or
extension of any Letter of Credit or other extension of credit (including any
election of an interest rate or Interest Period relating thereto), (B) relates
to the payment of any principal or other amount due under this Agreement prior
to the scheduled date therefor, (C) provides notice of any Default or Event of
Default or (D) is required to be delivered to satisfy any condition precedent to
the effectiveness of this Agreement and/or any Advance, Letter of Credit,
increase or extension of any Letter of Credit or other extension of credit
hereunder, shall be in writing (including telecopy communication) and mailed,
telecopied or delivered pursuant to this Section 10.02. All such notices and
communications shall be effective, if mailed, five Business Days after deposit
in the mails; if sent by overnight courier, one Business Day after delivery to
the courier company; and if sent by telecopier, when received by the receiving
telecopier equipment, respectively; provided that notices and communications to
the Administrative Agent, the Issuing Banks, the Swingline Lenders or the
Collateral Agent shall not be effective until received by the Administrative
Agent, the Issuing Banks, the Swingline Lenders or the Collateral Agent, as the
case may be. Any notice or communication to a Lender shall be deemed to be a
notice or communication to any SPC designated by such Lender and no further
notice to such SPC shall be required.
The Credit Parties hereby agree that they will provide to the
Administrative Agent and the Collateral Agent all information, documents and
other materials that they are obligated to furnish to the Administrative Agent
or the Collateral Agent, as the case may be, pursuant to the Credit Documents,
including all notices, requests, financial statements, financial and other
reports, certificates and other information materials, but excluding any such
communication that (i) relates to a request for a new, or a
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Conversion or continuation of an existing Advance, a new Letter of Credit, any
increase or extension of any Letter of Credit or other extension of credit
(including any election of an interest rate or Interest Period relating
thereto), (ii) relates to the payment of any principal or other amount due under
this Agreement prior to the scheduled date therefor, (iii) provides notice of
any Default or Event of Default or (iv) is required to be delivered to satisfy
any condition precedent to the effectiveness of this Agreement and/or any
Advance, Letter of Credit, increase or extension of any Letter of Credit or
other extension of credit hereunder (all such non-excluded communications being
referred to herein collectively as "Communications"), by transmitting the
Communications in an electronic/soft medium in a format acceptable to the Agent
to ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇. In addition, the Credit Parties agree to
continue to provide the Communications to the Administrative Agent and the
Collateral Agent in the manner specified in the Credit Documents but only to the
extent requested by the Administrative Agent or the Collateral Agent.
The Credit Parties further agree that the Administrative Agent or the
Collateral Agent may make the Communications available to the Lenders and the
Issuing Banks by posting the Communications on Intralinks, Fixed Income Direct
or a substantially similar electronic transmission systems (the "Platform"). The
Credit Parties acknowledge that the distribution of material through an
electronic medium is not necessarily secure and that there are confidentiality
and other risks associated with such distribution.
THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE". THE AGENT PARTIES
(AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM
VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT PARTIES IN CONNECTION WITH
THE COMMUNICATIONS OR THE PLATFORM. IN NO EVENT SHALL THE ADMINISTRATIVE AGENT,
THE COLLATERAL AGENT OR ANY OF THEIR RESPECTIVE AFFILIATES OR ANY OF THE
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES
OF THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT OR THEIR RESPECTIVE AFFILIATES
(COLLECTIVELY, "AGENT PARTIES") HAVE ANY LIABILITY TO ANY LENDER PARTY, ANY
CREDIT PARTY OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING
DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR
EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE
TRANSMISSION BY ANY CREDIT PARTY, ANY OF THE AGENT PARTIES OR ANY OTHER PERSON
OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF
ANY AGENT PARTY IS FOUND IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF
COMPETENT JURISDICTION TO HAVE RESULTED PRIMARILY FROM SUCH AGENT PARTY'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT.
The Administrative Agent agrees that the receipt of the Communications
by the Administrative Agent at its email address set forth above shall
constitute effective delivery of the Communications to the Administrative Agent
for purposes of the Credit Documents. Each Lender Party agrees that notice to it
(as provided in the next sentence) specifying that the Communications have been
posted to the Platform shall constitute effective delivery of the Communications
to such Lender for purposes of the Credit Documents. Each Lender Party agree to
notify the Administrative Agent in writing (including by electronic
communication) from time to time of such Lender Party's email address to which
the foregoing
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notice may be sent by electronic transmission and (ii) that the foregoing notice
may be sent to such email address.
Nothing herein shall prejudice the right of the Credit Parties, the
Administrative Agent, the Collateral Agent, the Collateral Trustee, the Issuing
Lender or any Lender to give any notice or other communication pursuant to any
Credit Document in any other manner specified in such Credit Document.
Section 10.03. No Waiver; Remedies. No failure on the part of any
Lender, the Issuing Banks, the Collateral Agent or the Administrative Agent to
exercise, and no delay in exercising, any right under any Credit Document shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies provided in the Credit Documents are cumulative and
not exclusive of any remedies provided by law. The Collateral Agent and the
Collateral Trustee may foreclose on, or take other action after default in
respect of, any of the Collateral in any order.
Section 10.04. Costs, Expenses and Indemnity. (a) Each of the Parent
and the Borrower agrees to pay within ten Business Days, (i) all reasonable
costs and expenses incurred by the CNAI or any of its affiliates in connection
with the preparation, execution, delivery, administration, modification and
amendment of the Credit Documents and the other documents to be delivered under
the Credit Documents, due diligence in connection with the Credit Documents and
syndication of the credit facilities contemplated herein, including the
reasonable fees and out-of-pocket expenses of counsel for the Administrative
Agent with respect to preparation, execution and delivery of the Credit
Documents and the satisfaction of the matters referred to in Section 3.01, the
reasonable costs and expenses of the Issuing Banks in connection with any Letter
of Credit, the reasonable costs and expenses of the Collateral Agent and the
Collateral Trustee and all amounts paid by the Collateral Agent or the
Collateral Trustee pursuant to any Security Document, and (ii) all reasonable
legal and other costs and expenses of the Administrative Agent, the Issuing
Banks, the Collateral Agent, the Collateral Trustee the Swingline Lenders and
each Lender incurred during the existence of an Event of Default in connection
with the enforcement (whether through negotiations, legal proceedings or
otherwise) of the Credit Documents and the other documents to be delivered under
the Credit Documents or incurred in connection with any workout, restructuring
or bankruptcy. Notwithstanding anything in this Section 10.04 to the contrary,
however, any fees and expenses in connection with the replacement of the
Collateral Trustee are for the Collateral Agent's own account (unless the
replacement Collateral Trustee is required by applicable law).
(b) If any payment or purchase of principal of, or
Conversion of, any LIBOR Advance is made other than on the last day of an
Interest Period relating to such Advance, as a result of a payment, purchase or
Conversion pursuant to Section 2.04, 2.07(f), 2.08, 2.09, 2.10, 2.11, 2.13 or
2.16 or acceleration of the maturity of the Notes pursuant to Section 6.01 or
for any other reason, the Borrower shall, upon demand by any Lender (with a copy
of such demand to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender any amounts required to compensate such Lender for
any additional losses, costs or expenses which it may reasonably incur as a
result of such payment, purchase or Conversion, including any loss (excluding
loss of anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to fund or maintain such Advance.
(c) Each of the Parent and the Borrower hereby
indemnifies and holds harmless each Lender Party and each of their respective
directors, officers, employees, trustees, advisors and agents (collectively,
"Indemnified Parties") from and against any and all claims, damages, losses,
liabilities and expenses (including reasonable fees and disbursements of counsel
and claims, damages, losses, liabilities and expenses relating to Environmental
matters) (collectively, "Losses") for which any of them may become liable or
which may be incurred by or asserted against an Indemnified Party, in each case
arising
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out of, related to or in connection with (i) any transaction in which any
proceeds of all or any part of the Advances are applied, (ii) breach by the
Borrower, any Subsidiary or the Parent of any Credit Document, (iii) violation
by the Parent, the Borrower or any Subsidiary of any Environmental Law or any
other law, rule, regulation or order, (iv) any Lien granted pursuant to any
Credit Document, (v) ownership by any Indemnified Party of any property
following foreclosure (or similar action) under any of the Credit Documents, to
the extent such Losses arise out of or result from (x) any Hazardous Materials
located in, on or under the property of the Parent or any Subsidiary on the date
of such foreclosure (or similar action) or (y) operation of any such property on
or before the date of such foreclosure (or similar action) but after notice to
the Borrower, including Losses which are imposed upon Persons under any
Environmental Law solely by virtue of ownership, (vi) any Indemnified Party's
being deemed an operator of any property of the Borrower, the Parent or any
Subsidiary by a court or other Person following foreclosure (or similar action),
to the extent such Losses arise out of or result from any Environmental matter
or any Hazardous Materials located in, on or under any such property, (vii) any
of Transactions, or (viii) any investigation, litigation, or proceeding, whether
or not any Indemnified Party is a party thereto, related to or in connection
with any of the foregoing or any Credit Document (EXPRESSLY INCLUDING ANY SUCH
LOSSES ATTRIBUTABLE TO THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH
INDEMNIFIED PARTY, BUT EXCLUDING ANY SUCH LOSSES ATTRIBUTABLE TO THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY). IT IS THE INTENT OF
THE PARTIES HERETO THAT EACH INDEMNIFIED PARTY SHALL, TO THE EXTENT PROVIDED IN
THIS SECTION 10.04(C), BE INDEMNIFIED FOR ITS OWN ORDINARY, SOLE OR CONTRIBUTORY
NEGLIGENCE. The Administrative Agent will provide the Borrower prompt notice of
any matter (other than matters solely among Indemnified Parties) as to which
indemnification pursuant to this Section 10.04(c) is claimed.
Section 10.05. Right of Set-Off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) either (i) the Revolving Credit
Advances or the Term Advances having become due and payable in accordance with
the terms hereof, or (ii) the making of the request or the granting of the
consent specified by Section 6.01 to authorize the Administrative Agent to
declare the Advances due and payable pursuant to the provisions of Section 6.01,
each Lender is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Lender to or for the credit or the
account of any Credit Party against any and all of the obligations of such
Credit Party now or hereafter existing under any Credit Document, irrespective
of whether or not such Lender shall have made any demand under any Credit
Document and although such obligations may be unmatured. Each Lender agrees
promptly to notify such Credit Party after any such set-off and application made
by such Lender, provided that the failure to give such notice shall not affect
the validity of such set-off and application. The rights of each Lender under
this Section are in addition to other rights and remedies (including other
rights of set-off) which such Lender may have.
Section 10.06. Assignments and Participations. (a) Each Lender may, in
accordance with applicable law, assign to one or more Lenders or other entities
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Revolving Commitment, its Term Commitment, the Advances
owing to it and the Notes held by it); provided that (i) each such assignment
shall be of a constant, and not a varying, percentage of all rights and
obligations under this Agreement in respect of its Revolving Commitment and
Revolving Advances (including the Letter of Credit Liabilities held by the
assigning Lender pursuant to Section 2.18) or in respect of its Term Advances,
(ii) except in the case of an assignment of all of a Lender's rights and
obligations under this Agreement, an assignment to another Lender, or an
assignment of Term Advances to an Eligible Assignee that is an Affiliate of a
Lender or an Approved Fund, the Revolving Commitment or Term Advances of the
assigning Lender being assigned pursuant to each such assignment (determined as
of the date of the Transfer Agreement with respect to such assignment) shall in
no event be less than $1,000,000 and shall be in an integral multiple of
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$1,000,000, (iii) each such assignment shall be to an Eligible Assignee, and
(iv) the parties to each such assignment shall execute and deliver to the
Administrative Agent, for acceptance by the Administrative Agent and recording
by the Administrative Agent in the Register, a Transfer Agreement, together with
any Notes then held by such assigning Lender and any Notes then held by such
assignee and a processing and recordation fee of $3,500 payable by the assignee,
provided that only one such processing and recordation fee shall be due in
connection with concurrent assignments of Term Advances to two or more Approved
Funds. Upon such execution, delivery, acceptance and recording, from and after
the effective date specified in each Transfer Agreement, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Transfer
Agreement, have the rights and obligations of a Lender hereunder, (y) the Lender
assignor thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Transfer Agreement, relinquish its
rights and be released from its obligations under this Agreement (and, in the
case of a Transfer Agreement covering all of an assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a party hereto
except that the rights under Sections 2.06, 2.10, 2.13 and 10.04 of such Lender
shall continue with respect to events and occurrences occurring before or
concurrently with its ceasing to be a party hereto), and (z) unless the Borrower
consents to such assignment, no such assignee shall be entitled to receive any
greater payment pursuant to Sections 2.06, 2.10 and 2.13 than the assigning
Lender would have been entitled to receive with respect to the rights assigned
to such assignee, except as a result of circumstances arising after, and that
could not reasonably be expected at, the date of such assignment.
(b) By executing and delivering a Transfer Agreement, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Transfer Agreement, and other than that the assignor is the legal and
beneficial owner of the interest being assigned and that the assigned interest
is free and clear of any adverse claim, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with any
Credit Document or any other instrument or document furnished pursuant hereto or
in connection herewith, the perfection, existence, sufficiency or value of any
Collateral, guaranty or insurance or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Credit Document or any
other instrument or document furnished pursuant hereto or in connection
herewith; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any other Person or the performance or observance by the Borrower or
any other Person of any of its respective obligations under any Credit Document
or any other instrument or document furnished pursuant hereto or in connection
herewith; (iii) such assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
Section 4.01(d) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Transfer Agreement; (iv) such assignee will, independently and without reliance
upon the Administrative Agent, the Collateral Agent, the Collateral Trustee, the
Issuing Banks, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement, any of the other Credit Documents or any other instrument or
document; (v) such assignee confirms that it is an Eligible Assignee; (vi) such
assignee appoints and authorizes the Administrative Agent to take such action as
Administrative Agent on its behalf and to exercise such powers and discretion
under the Credit Documents as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers and discretion as are
reasonably incidental thereto; (vii) such assignee appoints and authorizes the
Collateral Agent to take such action as Collateral Agent on its behalf and to
exercise such powers and discretion under the Credit Documents as are delegated
to the Collateral Agent by the terms hereof or thereof, together with such
powers and discretion as are reasonably incidental thereto; and (viii) such
assignee agrees that it will perform in accordance with their
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terms all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.
(c) The Administrative Agent shall maintain at its
address referred to in Section 10.02 a copy of each Transfer Agreement delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lenders and the Revolving Commitment of, the Term Commitment
of, the principal amount of the Revolving Advances owing to, and the principal
amount of the Term Advances owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Administrative Agent, the
Collateral Agent, the Issuing Banks and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(d) Upon its receipt of a Transfer Agreement executed by
an assigning Lender and an assignee representing that it is an Eligible
Assignee, together with any Notes then held by such assigning Lender and any
Notes then held by such assignee, the Administrative Agent shall, if such
Transfer Agreement has been completed and is in substantially the form of
Exhibit G, (i) accept such Transfer Agreement, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. Within five Business Days after its receipt of such notice, an
authorized officer of the Borrower shall execute and deliver to the
Administrative Agent (i) in exchange for the surrendered Revolving Notes a new
Revolving Note payable to the order of such Eligible Assignee in an amount equal
to its Revolving Commitment after giving effect to such Transfer Agreement and,
if the assigning Lender has retained a Revolving Commitment hereunder, a new
Revolving Note payable to the order of the assigning Lender in an amount equal
to the Revolving Commitment retained by it hereunder (such new Revolving Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Revolving Notes, shall be dated the effective date of
such Transfer Agreement, shall be properly completed and shall otherwise be in
substantially the form of Exhibit A-1), and (ii) in exchange for the surrendered
Term Notes a new Term Note payable to the order of such Eligible Assignee in an
amount equal to its Term Advances after giving effect to such Transfer Agreement
and, if the assigning Lender has retained any Term Advance hereunder, a new Term
Note payable to the order of the assigning Lender in an amount equal to the Term
Advances retained by it hereunder (such new Term Notes shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Term Notes, shall be dated the effective date of such Transfer Agreement, shall
be properly completed and shall otherwise be in substantially the form of
Exhibit A-2).
(e) Each Lender, in accordance with applicable law, may
sell participations to one or more Lenders or other entities (other than the
Borrower or any of its Affiliates) in or to all or a portion of its rights and
obligations under this Agreement (including all or a portion of any of its
Commitments, the Advances owing to it and the Notes held by it); provided that
(i) such Lender's obligations under this Agreement (including its Commitment to
the Borrower hereunder) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any such Notes for all
purposes of this Agreement, (iv) the Borrower, the Administrative Agent, the
Collateral Agent, the Issuing Banks and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement, (v) the terms of any such participation shall
not restrict such Lender's ability to make any amendment or waiver of any Credit
Document or such Lender's ability to consent to any departure by the Borrower
therefrom without the approval of the participant, except that the approval of
the participant may be required to the extent that such amendment, waiver or
consent would reduce the principal of, or interest
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on, the Notes or any fees or other amounts payable hereunder, in each case to
the extent subject to such participation, or postpone any date fixed for any
payment of principal of, or interest on, the Notes or any fees or other amounts
payable hereunder, in each case to the extent subject to such participation, and
(vi) unless the Borrower otherwise consents, no such participant shall be
entitled to receive any greater payment pursuant to Sections 2.06, 2.10 and 2.13
than such Lender would have been entitled to receive with respect to the rights
assigned to such participant by such Lender, except as a result of circumstances
arising after, and that could not reasonably be expected at, the date of such
participation.
(f) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including the Advances owing to it
and the Notes held by it) in favor of any Federal Reserve Bank in accordance
with Regulation A of the Federal Reserve Board. In the case of any Term Lender
that is a fund, such Lender may, without the consent of the Borrower or the
Administrative Agent, collaterally assign or pledge all or any portion of its
rights under this Agreement, including the Advances and Notes or any other
instrument evidencing its rights as a Lender under this Agreement, to any holder
of, trustee for, or any other representative of holders of, obligations owed or
securities issued, by such fund, as security for such obligations or securities.
(g) Notwithstanding anything to the contrary contained
herein, any Revolving Lender (a "Designating Bank") with the consent of the
Administrative Agent (and, if no Event of Default has occurred and is
continuing, the Borrower) may grant to a special purpose funding vehicle (an
"SPC"), identified as such in writing from time to time by the Designating Bank
to the Administrative Agent and the Borrower, the option to fund all or any part
of any payment to an Issuing Bank or a Swingline Lender or any Revolving Advance
which the Designating Bank has agreed to make; provided that no Designating Bank
shall have granted at any one time such option to more than one SPC; and
provided further that (i) such Designating Bank's obligations under this
Agreement shall remain unchanged, (ii) such Designating Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) the Borrower, the Issuing Banks, the Collateral Agent, the Administrative
Agent, the Swingline Lenders and the other Lenders shall continue to deal solely
and directly with such Designating Bank in connection with such Designating
Bank's rights and obligations under this Agreement, (iv) any such option granted
to an SPC shall not constitute a commitment by such SPC to fund any payment to
an Issuing Bank or a Swingline Lender or to fund any Revolving Advance, and (v)
neither the grant to nor the exercise of such option by an SPC shall increase
the costs or expenses or otherwise increase or change the obligations of the
Borrower under this Agreement. The making of a Revolving Advance by an SPC
hereunder shall utilize the Commitment of the Designating Bank to the same
extent, and as if, such Revolving Advance were made by such Designating Bank.
Each party hereto hereby agrees that no SPC shall be liable for any indemnity or
similar payment obligation under this Agreement to the extent that any such
indemnity or similar payment obligation shall have been paid by its Designating
Bank. In furtherance of the foregoing, each party hereto hereby agrees (which
agreement shall survive the termination of this Agreement) that, prior to the
date that is one year and one day after the payment in full of all outstanding
commercial paper or other senior indebtedness of any SPC, it will not institute
against, or join any other person in instituting against such SPC any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under the laws of the United States. In addition, notwithstanding anything to
the contrary contained in this Section 10.06, an SPC may not assign its interest
in any Letter of Credit, Swingline Advance or Revolving Advance except that,
with notice to, but without the prior written consent of, the Borrower and the
Administrative Agent and without paying any processing fee therefor, such SPC
may assign all or a portion of its interests in any Letter of Credit, Swingline
Advance or Revolving Advance to the Designating Bank or to any financial
institution (consented to by the Borrower, applicable Issuing Banks and
Administrative Agent), providing liquidity and/or credit support to or for the
account of such SPC to support the funding or maintenance of any Letter of
Credit, Swingline Advance or Revolving Advance. Each Designating Bank shall
serve as the agent of its SPC and shall on behalf of its SPC (i) receive any and
all payments made for the benefit of such SPC and (ii) give and receive all
communications and notices, and vote, approve or consent hereunder, and take all
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actions hereunder, including votes, approvals, waivers, consents and amendments
under or relating to this Agreement and the other Credit Documents. Any such
notice, communication, vote, approval, waiver, consent or amendment shall be
signed by the Designating Bank for the SPC and need not be signed by such SPC on
its own behalf. The Borrower, the Issuing Banks, the Collateral Agent, the
Collateral Trustee, the Administrative Agent and the Lenders may rely thereon
without any requirement that the SPC sign or acknowledge the same or that notice
be delivered to the Borrower or the SPC. This Section 10.06(g) may not be
amended without the written consent of any SPC, which shall have been identified
to the Administrative Agent and the Borrower.
Section 10.07. Governing Law; Entire Agreement. This Agreement and the
Notes shall be governed by, and construed in accordance with, the laws of the
State of New York without regard to its conflicts of law rules (other than
Section 5-1401 of the New York General Obligations Law). This Agreement, the
Notes, the other Credit Documents and any fee letter pertaining hereto
constitute the entire understanding among the parties hereto with respect to the
subject matter hereof and supersede any prior agreements, written or oral, with
respect thereto.
Section 10.08. Interest. It is the intention of the parties hereto that
the Administrative Agent, the Issuing Banks, each Lender and each other Lender
Party shall conform strictly to usury laws applicable to it, if any.
Accordingly, if the transactions with the any Lender Party contemplated hereby
would be usurious under applicable law, if any, then, in that event,
notwithstanding anything to the contrary in any Credit Document, it is agreed as
follows: (a) the aggregate of all consideration which constitutes interest under
applicable law that is contracted for, taken, reserved, charged or received by
any Lender Party under any Credit Document shall under no circumstances exceed
the maximum amount allowed by such applicable law and any excess shall be
cancelled automatically and, if theretofore paid, shall at the option of the
such Lender Party, be applied on the principal amount of the obligations owed to
such Lender Party by the Borrower or refunded such Lender Party to the Borrower,
and (b) in the event that the maturity of any Note or other obligation payable
to any Lender Party is accelerated or in the event of any permitted prepayment,
then such consideration that constitutes interest under law applicable to such
Lender Party may never include more than the maximum amount allowed by such
applicable law and excess interest, if any, to such Lender Party provided for in
any Credit Document or otherwise shall be cancelled automatically as of the date
of such acceleration or prepayment and, if theretofore paid, shall, at the
option of such Credit Party be credited by such Credit Party on the principal
amount of the obligations owed to by the Borrower or refunded by such Credit
Party to the Borrower.
Section 10.09. Confidentiality. Each Lender Party agrees that it will
use reasonable efforts not to disclose without the prior consent of the Borrower
(other than to such Lender Party's Affiliates, employees, auditors or counsel or
to another Lender Party if the disclosing Lender Party or the disclosing Lender
Party's holding or parent company in its sole discretion determines that any
such party should have access to such information) any information with respect
to the Parent or its Subsidiaries which is furnished pursuant to this Agreement
or any other Credit Document and which is designated by the Borrower to such
Lender Parties in writing as confidential, provided that any such Lender Party
may disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or federal regulatory body having or
claiming to have jurisdiction over such Lender Party or to the Federal Reserve
Board or the FDIC or similar organizations (whether in the United States or
elsewhere), (c) as may be required or appropriate in response to any summons or
subpoena or in connection with any litigation, (d) in order to comply with any
law, order, regulation or ruling applicable to such Lender Party, (e) to the
prospective transferee in connection with any contemplated transfer of any of
the Notes or any interest therein by such Lender or the grant of an option to an
SPC to fund any payment to an Issuing Bank or a Swingline Lender or any
Revolving Advance, provided that such prospective transferee executes an
agreement with the Borrower containing provisions substantially identical to
those contained in this
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Section 10.09, and provided further that if the contemplated transfer is a grant
of an option to fund a payment to an Issuing Bank or a Swingline Lender or any
Revolving Advance to an SPC pursuant to Section 10.06(g), such SPC may disclose
(x) on a confidential basis, any non-public information relating to such
drawings funded by it to any rating agency, commercial paper dealer or provider
of any surety, guaranty or credit or liquidity enhancement to such SPC, and (y)
such information as may be required by law or regulation to be delivered, and
(f) to any Lender Party. Any Person required to maintain the confidentiality of
information as provided in this Section 10.09 shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such information as such
Person would accord to its own confidential information. Without prejudice to
the survival of any other agreement hereunder, the agreements and obligations of
the Lender Parties contained in this Section 10.09 shall survive the payment in
full of all Obligations .
Section 10.10. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section 10.11. Domicile of Loans. Each Lender may transfer and carry
its loans at, to or for the account of any office, Subsidiary or Affiliate of
such Lender provided that no Lender shall be relieved of its obligations as a
result thereof.
Section 10.12. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower, the Guarantors, the Issuing
Banks, the Collateral Agent, the Swingline Lenders and the Administrative Agent
and when the Administrative Agent shall have, as to each Lender, either received
a copy of a signature page hereof executed by such Lender or been notified by
such Lender that such Lender has executed it and thereafter shall be binding
upon and inure to the benefit of and be enforceable by the Borrower, the
Administrative Agent, the Issuing Banks, the Collateral Agent and each Lender
and their respective successors and assigns, except that the Borrower shall not
have the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lenders.
Section 10.13. WAIVER OF JURY TRIAL. THE BORROWER, THE GUARANTORS, THE
ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE ISSUING BANKS AND THE LENDERS
HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OF THE NOTES, ANY
LETTER OF CREDIT, ANY OTHER CREDIT DOCUMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY.
Section 10.14. Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Credit Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby. The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.
Section 10.15. FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY
CREDIT DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS,
THE ISSUING BANKS, THE COLLATERAL AGENT, THE GUARANTORS OR THE BORROWER IN
CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN ▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇▇
-▇▇-
▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE COUNTY OF NEW YORK OR IN THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL MAY BE BROUGHT, AT THE COLLATERAL
AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL MAY BE
FOUND. THE BORROWER AND THE GUARANTORS IRREVOCABLY CONSENT TO THE SERVICE OF
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN ACCORDANCE
WITH SECTION 10.02. THE BORROWER AND THE GUARANTORS HEREBY EXPRESSLY AND
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
THEY MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY
SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT
THE BORROWER OR ANY GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR
NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR
OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER OR SUCH
GUARANTOR, AS THE CASE MAY BE, HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT
PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THE CREDIT
DOCUMENTS.
Section 10.16. DAMAGES. EACH OF THE BORROWER, THE ADMINISTRATIVE AGENT,
THE COLLATERAL AGENT, THE ISSUING BANKS, THE GUARANTORS AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY
DO SO UNDER APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
ACTION OR PROCEEDING REFERRED TO IN SECTION 10.15 ANY EXEMPLARY, PUNITIVE,
SPECIAL OR CONSEQUENTIAL DAMAGES; PROVIDED THAT NOTHING HEREIN SHALL CONSTITUTE
A WAIVER BY THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE ISSUING BANKS,
THE SWINGLINE LENDERS OR ANY OTHER LENDER OF ANY RIGHT TO RECEIVE FULL PAYMENT
OF ALL OBLIGATIONS.
Section 10.17. Patriot Act Notice. Each Lender and the Administrative
Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower
that pursuant to the requirements of the Patriot Act, it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of Borrower and other information that will allow
such Lender or the Administrative Agent, as applicable, to identify the Borrower
in accordance with the Patriot Act. The Borrower shall, and shall cause each of
its Affiliates to, provide, to the extent commercially reasonable, such
information and take such actions as are reasonably requested by the
Administrative Agent or any Lender in order to assist the Administrative Agent
and the Lenders in maintaining compliance with the Patriot Act.
Section 10.18. Survival of Agreements, Representations and Warranties,
Etc. All warranties, representations and covenants made in or in connection with
any Credit Document shall be considered to have been relied upon by the Lender
Parties and shall survive the issuance of any Letters of Credit and the issuance
and delivery of the Notes and the making of Advances regardless of any
investigation. In addition, the confidentiality provisions contained in Section
10.09 shall survive the termination of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
BORROWER:
PRIDE OFFSHORE, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
Address for notices to one or more Credit Parties:
Attention of the Treasurer of Pride International, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Fax Number: ▇▇▇-▇▇▇-▇▇▇▇
Telephone Number: ▇▇▇-▇▇▇-▇▇▇▇
with copies to its Assistant Treasurer, Treasury
Operations and its General Counsel.
ADMINISTRATIVE AGENT:
CITICORP NORTH AMERICA, INC., as
Administrative Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------------------
Authorized Officer
COLLATERAL AGENT:
CITIBANK, N. A., as Collateral Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------------------
Authorized Officer
Signature Page to the Credit Agreement
ISSUING BANKS AND SWINGLINE LENDERS:
CALYON NEW YORK BRANCH,
as an Issuing Bank and as a Swingline Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------------------
Authorized Officer
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
NATEXIS BANQUES POPULAIRES,
as an Issuing Bank and as a Swingline Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President/Manager
By: /s/ ▇▇▇▇▇▇ ▇'▇▇▇▇▇▇
---------------------------------------------------
▇▇▇▇▇▇ ▇'▇▇▇▇▇▇, Senior Vice President/
Regional Manager
Signature Page to the Credit Agreement
REVOLVING LENDERS
REVOLVING COMMITMENT
$50,000,000 CITICORP NORTH AMERICA, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Authorized Officer
Signature Page to the Credit Agreement
$45,000,000 NATEXIS BANQUES POPULAIRES
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President/
Manager
By: /s/ ▇▇▇▇▇▇ ▇'▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇'▇▇▇▇▇▇, Senior Vice
President/Regional Manager
Signature Page to the Credit Agreement
$45,000,000 BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇
Managing Director
Signature Page to the Credit Agreement
$45,000,000 NORDEA
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Senior Vice President
By: /s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇▇▇▇▇
Vice President
Signature Page to the Credit Agreement
$45,000,000 DEUTSCHE BANK TRUST COMPANY AMERICAS
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
Managing Director
Signature Page to the Credit Agreement
$37,500,000 CALYON NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Managing Director
Signature Page to the Credit Agreement
$37,500,000 BNP PARIBAS
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Co-Head of Global Shipping Finance
Signature Page to the Credit Agreement
$37,500,000 SUMITOMO MITSUI BANKING CORPORATION
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President
Signature Page to the Credit Agreement
$37,500,000 Skandinaviska Enskilda ▇▇▇▇▇▇ ▇▇ (publ.)
By: /s/ ▇▇▇▇ ▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Signature Page to the Credit Agreement
$13,750,000 CREDIT INDUSTRIEL ET COMMERCIAL
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ d'Aubigne
---------------------------------------
▇▇▇▇▇ ▇▇▇▇▇ d'Aubigne
By: /s/ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Signature Page to the Credit Agreement
$13,750,000 BECM
By: /s/ ▇. ▇▇▇▇▇▇▇▇ Dueve
--------------------------------------
Authorized Officer
Signature Page to the Credit Agreement
$27,500,000 DnB NOR BANK ASA
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
First Vice President
Signature Page to the Credit Agreement
$27,500,000 HSH NORDBANK AG
By: /s/ illegible
---------------------------------------
Authorized Officer
Vice President
Signature Page to the Credit Agreement
$27,500,000 VEREINS-UND WESTBANK AG
By: /s/ illegible
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Authorized Officer
Signature Page to the Credit Agreement
$10,000,000 SOUTHWEST BANK OF TEXAS
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Senior Vice President
Signature Page to the Credit Agreement
TERM LENDERS
TERM COMMITMENT
$300,000,000 CITICORP NORTH AMERICA, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Authorized Officer
Signature Page to the Credit Agreement
GUARANTORS:
PRIDE INTERNATIONAL, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President - Treasury and Investor
Relations
MEXICO DRILLING LIMITED LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE CENTRAL AMERICA, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE OFFSHORE INTERNATIONAL LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE SOUTH PACIFIC LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
Signature Page to the Credit Agreement
PRIDE DRILLING, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE NORTH AMERICA LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PETROLEUM SUPPLY COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE INTERNATIONAL SERVICES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
PRIDE MEXICO HOLDINGS, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
Signature Page to the Credit Agreement
PRIDE INTERNATIONAL MANAGEMENT COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
Signature Page to the Credit Agreement
Schedule I
Applicable Lending Offices
LENDER DOMESTIC LENDING OFFICE EURODOLLAR LENDING OFFICE
-----------------------------------------------------------------------------------------------
Citicorp North America, Inc.
-----------------------------------------------------------------------------------------------
Natexis Banques Populaires
-----------------------------------------------------------------------------------------------
Bank of America, N.A.
-----------------------------------------------------------------------------------------------
Nordea Bank Norge ASA Grand Cayman Branch
-----------------------------------------------------------------------------------------------
Deutsche Bank Trust Company Americas
-----------------------------------------------------------------------------------------------
Calyon New York Branch
-----------------------------------------------------------------------------------------------
BNP Paribas
-----------------------------------------------------------------------------------------------
Sumitomo Mitsui Banking Corporation
-----------------------------------------------------------------------------------------------
Skandinaviska Enskilda ▇▇▇▇▇▇ ▇▇
-----------------------------------------------------------------------------------------------
Credit Industriel Et Commercial
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BECM
-----------------------------------------------------------------------------------------------
DnB Nor Bank ASA
-----------------------------------------------------------------------------------------------
HSH Nordbank AG
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Vereins-Und Westbank AG
-----------------------------------------------------------------------------------------------
Southwest Bank of Texas
-----------------------------------------------------------------------------------------------
Schedule I to the Credit Agreement
EXHIBIT A-1
REVOLVING NOTE
U.S.$ ________ Dated:________
For value received, the undersigned, Pride Offshore, Inc., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of ________
(the "Lender") for the account of its Applicable Lending Office (as defined in
the Credit Agreement referred to below) the principal sum of ________ U.S.
Dollars (U.S. $________) or, if less, the aggregate unpaid principal amount of
the Revolving Advances (as defined in such Credit Agreement) owing to the
Lender.
This Revolving Note is one of the Revolving Notes referred to in, and is
subject to and is entitled to the benefits of, the Credit Agreement, dated as of
July 7, 2004, among the Borrower, the Lenders and Guarantors parties thereto
from time to time, other parties and Citicorp North America, Inc., as
Administrative Agent (as the same may be amended, modified and supplemented from
time to time, the "Credit Agreement"). The Credit Agreement, among other things,
(i) provides for the making of Revolving Advances by the Lender to the Borrower
from time to time in an aggregate amount not to exceed the amount first above
mentioned, (ii) provides that the indebtedness of the Borrower resulting from
each Revolving Advance owing to the Lender be evidenced by this Revolving Note,
and (iii) contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events and also for prepayments on account of
principal hereof prior to the maturity hereof upon the terms and conditions
therein specified. Reference is made to the Credit Agreement for the respective
meanings assigned to the capitalized terms used and not otherwise defined in
this Revolving Note.
The Borrower promises to pay the principal of this Revolving Note on the
dates and in the amounts set forth in the Credit Agreement. Additionally, the
Borrower promises to pay interest on the unpaid principal amount of each
Revolving Advance owing to the Lender from the date of such Revolving Advance
until such principal amount is paid in full, at such interest rates, and payable
at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Citicorp North America, Inc., as Administrative Agent, at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in same day funds. Each Revolving
Advance owed to the Lender by the Borrower pursuant to the Credit Agreement, and
all payments made on account of principal thereof, shall be recorded by the
Lender and, prior to any transfer hereof, endorsed on the grid attached hereto
which is part of this Revolving Note; provided that the failure of the Lender to
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This Revolving Note shall be governed by, and construed in accordance
with, the laws of the State of New York.
PRIDE OFFSHORE, INC.
By: ________________________________
Name: ______________________________
Title: _____________________________
REVOLVING ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of Type of Amount of Unpaid
Revolving Revolving Principal Paid Principal Notation
Date Advance Advance or Prepaid Balance Made By
----------------- -------------- ----------- ---------------- ----------- --------
----------------- -------------- ----------- ---------------- ----------- --------
----------------- -------------- ----------- ---------------- ----------- --------
----------------- -------------- ----------- ---------------- ----------- --------
----------------- -------------- ----------- ---------------- ----------- --------
-2-
EXHIBIT A-2
TERM NOTE
U.S. $________ Dated:________
For value received, the undersigned, Pride Offshore, Inc., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of ________
(the "Lender") for the account of its Applicable Lending Office (as defined in
the Credit Agreement referred to below) the principal sum of ________ U.S.
Dollars (U.S. $________) or, if less, the aggregate unpaid principal amount of
the Term Advances (as defined in such Credit Agreement) owing to the Lender.
This Term Note is one of the Term Notes referred to in, and is subject to
and is entitled to the benefits of, the Credit Agreement, dated as of July 7,
2004, among the Borrower, the Lenders and Guarantors parties thereto from time
to time, other parties and Citicorp North America, Inc., as Administrative Agent
(as the same may be amended, modified and supplemented from time to time, the
"Credit Agreement"). The Credit Agreement, among other things, (i) provides for
the making of a Term Advance by the Lender to the Borrower in the U.S. dollar
amount first above mentioned, (ii) provides that the indebtedness of the
Borrower resulting from the Term Advances owing to the Lender be evidenced by
this Term Note, and (iii) contains provisions for acceleration of the maturity
hereof upon the happening of certain stated events and also for prepayments on
account of principal hereof prior to the maturity hereof upon the terms and
conditions therein specified. Reference is made to the Credit Agreement for the
respective meanings assigned to the capitalized terms used and not otherwise
defined in this Term Note.
The Borrower promises to pay the principal of this Term Note on the dates
and in the amounts set forth in the Credit Agreement. Additionally, the Borrower
promises to pay interest on the unpaid principal amount of the Term Advances
owing to the Lender from the date of such Term Advances until such principal
amount is paid in full, at such interest rates, and payable at such times, as
are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Citicorp North America, Inc., as Administrative Agent, at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in same day funds. The Term Advances
owed to the Lender by the Borrower pursuant to the Credit Agreement, and all
payments made on account of principal thereof, shall be recorded by the Lender
and, prior to any transfer hereof, endorsed on the grid attached hereto which is
part of this Term Note; provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This Term Note shall be governed by, and construed in accordance with, the
laws of the State of New York.
PRIDE OFFSHORE, INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
TERM ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of Unpaid
Amount of Term Type of Term Principal Paid Principal Notation
Date Advance Advance or Prepaid Balance By Made
--------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------
-2-
EXHIBIT A-3
SWINGLINE NOTE
U.S. $________ Dated:________
For value received, the undersigned, Pride Offshore, Inc., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of ________
(the "Lender") for the account of its Applicable Lending Office (as defined in
the Credit Agreement referred to below) the principal sum of ________ U.S.
Dollars (U.S. $________) or, if less, the aggregate unpaid principal amount of
the Swingline Advances (as defined in such Credit Agreement) owing to the
Lender.
This Swingline Note is the Swingline Note referred to in, and is subject
to and is entitled to the benefits of, the Credit Agreement, dated as of July 7,
2004, among the Borrower, the Lenders and Guarantors parties thereto from time
to time, other parties and Citicorp North America, Inc., as Administrative Agent
(as the same may be amended, modified and supplemented from time to time, the
"Credit Agreement"). The Credit Agreement, among other things, (i) provides for
the making of Swingline Advances by the Lender to the Borrower from time to time
in an aggregate amount not to exceed the amount first above mentioned, (ii)
provides that the indebtedness of the Borrower resulting from each Swingline
Advance owing to the Lender be evidenced by this Swingline Note, and (iii)
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein specified.
Reference is made to the Credit Agreement for the respective meanings assigned
to the capitalized terms used and not otherwise defined in this Swingline Note.
The Borrower promises to pay the principal of this Swingline Note on the
dates and in the amounts set forth in the Credit Agreement. Additionally, the
Borrower promises to pay interest on the unpaid principal amount of each
Swingline Advance owing to the Lender from the date of such Swingline Advance
until such principal amount is paid in full, at such interest rates, and payable
at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to Citicorp North America, Inc., as Administrative Agent, at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in same day funds. Each Swingline
Advance owed to the Lender by the Borrower pursuant to the Credit Agreement, and
all payments made on account of principal thereof, shall be recorded by the
Lender and, prior to any transfer hereof, endorsed on the grid attached hereto
which is part of this Swingline Note; provided that the failure of the Lender to
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This Swingline Note shall be governed by, and construed in accordance
with, the laws of the State of New York.
PRIDE OFFSHORE, INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
SWINGLINE ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of Amount of Unpaid
Swingline Principal Paid Principal Notation
Date Advance or Prepaid Balance Made By
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-2-
EXHIBIT B-1
NOTICE OF BORROWING
[Date]
Citicorp North America, Inc., as Administrative Agent
▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, Pride Offshore, Inc., refers to the Credit Agreement,
dated as of July 7, 2004 (such Credit Agreement, as the same may be amended,
modified and supplemented from time to time being herein referred to as the
"Credit Agreement," the terms defined therein being used herein as therein
defined), among the undersigned, certain Lenders and Guarantors parties thereto,
others and Citicorp North America, Inc., as Administrative Agent, and hereby
gives you notice, irrevocably, pursuant to Article II of the Credit Agreement
that the undersigned hereby requests Advances under the Credit Agreement, and in
that connection sets forth below the information relating to such Advances (the
"Proposed Advances") as required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Advances is ____________, ____.
(ii) The aggregate amount of the Proposed Advances is $______________.
(iii) The Proposed Advances are [Revolving] [Term] [Swingline] Advances.
(iv) The Type of Advances comprising the Proposed Advances is a [Base
Rate Advance] [LIBOR Advance].(1)
[(v) The initial Interest Period for each Advance made as part of the
Proposed Advances is ______(months).](2)
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the Proposed Advances:
(A) the representations and warranties contained in Section 4.01 of the
Credit Agreement are correct on and as of each such date (other than those
representations and warranties that expressly relate solely to a specific
earlier date and that remain correct as of such earlier date), before and
after giving effect to the Proposed Advances and to the application of the
proceeds therefrom, as though made on and as of each such date; and
----------
(1) Only applicable for Proposed Advances consisting of Revolving Advances and
Term Advances
(2) Only applicable for Proposed Advances consisting of LIBOR Advances
(B) the representations and warranties contained in each other Credit
Document are correct in all material respects on and as of each such date
(other than those representations and warranties that expressly relate
solely to a specific earlier date and that remain correct in all material
respects as of such earlier date), before and after giving effect to the
Proposed Advances and to the application of the proceeds therefrom, as
though made on and as of each such date; and
(C) no event has occurred and is continuing, or would result from any such
Proposed Advance or the Borrowing of which any such Proposed Advance is a
part or from the application of the proceeds therefrom, which constitutes
a Default or an Event of Default.
Very truly yours,
PRIDE OFFSHORE, INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
-2-
EXHIBIT B-2
NOTICE OF LETTER OF CREDIT
[Date]
Citicorp North America, Inc., as Administrative Agent
▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, Pride Offshore, Inc. (the "Borrower"), refers to the
Credit Agreement, dated as of July 7, 2004 (such Credit Agreement, as the same
may be amended, modified and supplemented from time to time being herein
referred to as the "Credit Agreement," the terms defined therein being used
herein as therein defined), among the undersigned, certain Lenders and
Guarantors parties thereto, others and Citicorp North America, Inc., as
Administrative Agent, and hereby gives you notice, irrevocably, pursuant to
Section 2.18 of the Credit Agreement that the undersigned hereby requests the
issuance of a Letter of Credit under the Credit Agreement, and in that
connection sets forth below the information relating to such Letter of Credit
(the "Proposed Letter of Credit") as required by Section 2.18 of the Credit
Agreement. The Proposed Letter of Credit will be issued:
(a) check one
(i) _________ as a standby Letter of Credit
(ii) _________ as a commercial Letter of Credit
(b) date of issuance _____________
(c) for the benefit of ______________
(d) in the amount of $ _____________
(e) having an expiry date of ____________
(f) subject to the draw conditions set forth in Schedule I attached
hereto;
(g) for the following purpose: ________________________________; and
(h) having additional terms set forth in Schedule II attached hereto.
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the issuance date of the Proposed Letter of
Credit:
(A) the representations and warranties contained in Section 4.01 of the
Credit Agreement are correct on and as of each such date (other than those
representations and warranties that expressly relate solely to a specific
earlier date and that remain correct as of such earlier date), before and
after giving effect to such issuance, as though made on and as of each
such date; and
(B) the representations and warranties contained in each other Credit
Document are correct in all material respects on and as of each such date
(other than those representations and warranties that expressly relate
solely to a specific earlier date and that remain correct in all material
respects as of such earlier date), before and after giving effect to such
issuance, as though made on and as of each such date; and
(C) no event has occurred and is continuing, or would result from any such
Proposed Letter of Credit, which constitutes a Default or an Event of
Default.
Very truly yours,
PRIDE OFFSHORE, INC.
By: _________________________________
Name: _______________________________
Title: ______________________________
-2-
Schedule I
to
Notice of Letter of Credit
Draw Conditions
Schedule II
to
Notice of Letter of Credit
Additional Terms
EXHIBIT G
TRANSFER AGREEMENT
Dated ________ _______ , 20___
Reference is made to the Credit Agreement, dated as of July 7, 2004 (such
Credit Agreement, as the same may be amended, modified and supplemented from
time to time, being herein referred to as the "Credit Agreement"), among Pride
Offshore, Inc., a Delaware corporation (the "Borrower"), the Lenders and
Guarantors parties thereto from time to time, others and Citicorp North America,
Inc., as Administrative Agent. Terms defined in the Credit Agreement are used
herein with the same meaning.
_________________________ (the "Assignor") and __________________ (the
"Assignee") agree as follows:
1. With respect to the Assignor's Revolving Commitments and Revolving
Advances, the Assignor hereby sells and assigns to the Assignee, without
recourse, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to all of the Assignor's rights and obligations under the Credit
Agreement and the other Credit Documents as of the date hereof equal to the
percentage interest set forth in Section 1(a) on Schedule 1 hereto of all
outstanding rights and obligations under the Credit Agreement.
2. With respect to the Assignor's Term Advances, the Assignor hereby sells
and assigns to the Assignee, without recourse, and the Assignee hereby purchases
and assumes from the Assignor, an interest in and to all of the Assignor's
rights and obligations under the Credit Agreement and the other Credit Documents
as of the date hereof equal to the percentage interest set forth in Section 1(b)
hereto of all outstanding rights and obligations under the Credit Agreement.
3. By executing and delivering this Transfer Agreement, Assignor and
Assignee confirm to and agree with each other and the other parties to the
Credit Agreement as follows: (i) Assignor represents and warrants that it is the
legal and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim; (ii) other than as
provided in this Transfer Agreement, Assignor makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with any Credit Document
or any other instrument or document furnished pursuant the Credit Agreement or
in connection therewith, the perfection, existence, sufficiency or value of any
Collateral, guaranty or insurance or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Credit Document or any
other instrument or document furnished pursuant to the Credit Agreement or in
connection therewith; (iii) Assignor makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or any other Person or the performance or observance by the Borrower or
any other Person of any of its respective obligations under any Credit Document
or any other instrument or document furnished pursuant to the Credit Agreement
or in connection therewith; (iv) Assignee confirms that it has received a copy
of the Credit Agreement, together with copies of the financial statements
referred to in Section 4.01(d) and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into this Transfer Agreement; (v) Assignee will, independently and without
reliance upon the Administrative Agent, the Collateral Agent, the Collateral
Trustee, the Issuing Banks, Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement, any of the other Credit Documents or any other instrument or
document; (vi) Assignee confirms that it is an Eligible Assignee; (vii) Assignee
appoints and authorizes the Administrative Agent to take such action as
Administrative Agent on its
behalf and to exercise such powers and discretion under the Credit Documents as
are delegated to the Administrative Agent by the terms hereof or thereof,
together with such powers and discretion as are reasonably incidental thereto;
(viii) Assignee appoints and authorizes the Collateral Agent to take such action
as Collateral Agent on its behalf and to exercise such powers and discretion
under the Credit Documents as are delegated to the Collateral Agent by the terms
of the Credit Agreement or other Credit Documents, together with such powers and
discretion as are reasonably incidental thereto; and (ix) Assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Credit Agreement are required to be performed by it as a
Lender.
4. Assignor attaches the Notes (if any) held by the Assignor and requests
that the Administrative Agent exchange such Notes for (i) new Notes payable to
the order of the Assignee in an amount equal to the Revolving Commitment and
Term Advances of the Assignee after giving effect to this Transfer Agreement, or
(ii) new Notes payable to the order of the Assignee in an amount equal to the
Revolving Commitment and Term Advances of the Assignee after giving effect to
this Transfer Agreement and new notes payable to the order of the Assignor in an
amount equal to the Revolving Commitment and Term Advances retained by the
Assignor under the Credit Agreement, respectively, in each case as specified on
Schedule 1 hereto. Assignee attaches the Notes (if any) held by it and specifies
as its Domestic Lending Office (and address for notices) and Eurodollar Lending
Office, the offices set forth beneath its name on the signature pages hereof.
5. Following the execution of this Transfer Agreement by the Assignor and
the Assignee, this Transfer Agreement will be delivered to the Administrative
Agent for acceptance and recording by the Administrative Agent. The effective
date of this Transfer Agreement (the "Effective Date") shall be the date of
acceptance thereof by the Administrative Agent, unless otherwise specified on
Schedule 1 hereto.
6. Upon such acceptance and recording by the Administrative Agent, as of
the Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Transfer Agreement, have the rights and
obligations of a Lender thereunder and under the other Credit Documents, and
(ii) the Assignor shall, to the extent provided in this Transfer Agreement,
relinquish its rights and be released from its obligations under the Credit
Agreement and under the other Credit Documents.
7. Upon such acceptance and recording by the Administrative Agent, from
and after the Effective Date, the Administrative Agent shall make all payments
under the Credit Agreement and the other Credit Documents in respect of the
interest assigned hereby (including, without limitation, all payments of
principal, interest and commitment fees with respect thereto) to the Assignee.
The Assignor and Assignee shall make all appropriate adjustments in payments
under the Credit Agreement and the other Credit Documents for periods prior to
the Effective Date directly between themselves.
8. This Transfer Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
9. This Transfer Agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of
Schedule 1 to this Transfer Agreement by telecopier shall be as effective as
delivery of a manually executed counterpart of this Transfer Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Transfer Agreement
to be executed by their respective officers thereunto duly authorized, as of the
date first above written, such execution being made on Schedule 1 hereto.
-2-
Schedule 1
to
Transfer Agreement
Section 1.
(a) Percentage of Revolving Commitment and Revolving Advances assigned: _______%
(b) Percentage of Term Advances assigned: _______%
Section 2.
Aggregate outstanding principal of Revolving Commitment assigned to the Assignee
under this Transfer Agreement: $___________
Aggregate outstanding principal of Term Advances assigned to the Assignee under
this Transfer Agreement: $___________
Section 3.
Effective Date: __________ __________, 20_____
[NAME OF ASSIGNOR], as Assignor
By: ________________________________
Name:_______________________________
Title:______________________________
[NAME OF ASSIGNEE], as Assignee
By: ________________________________
Name:_______________________________
Title:______________________________
Domestic Lending Office (and address for notices):
[Address]
Eurodollar Lending Office:
[Address]
-3-
Accepted and Approved(1) this ___ day of______________, 20____
[NAME OF ADMINISTRATIVE AGENT], as Administrative Agent
By: ________________________________
Name:_______________________________
Title:______________________________
[Approved this ___ day of_________, 20_____
[NAME OF ISSUING BANKS], each as an Issuing Bank
By: ________________________________
Name:_______________________________
Title:______________________________](1)
[Approved this ___ day of _________, 20______
[NAME OF SWINGLINE LENDERS], each as a Swingline Lender
By: ________________________________
Name:_______________________________
Title:______________________________](1)
[Approved this ___ day of _________, 20______
PRIDE OFFSHORE, INC.
By: ________________________________
Name:_______________________________
Title:______________________________](1)
---------------------
(1) To be added only if the approval of the Administrative Agent,
Swingline Lenders, Issuing Banks and/or the Borrower is required by the terms of
the Credit Agreement.
-4-
EXHIBIT H
FORM OF SECURITY AGREEMENT
SECURITY AGREEMENT (this "AGREEMENT") dated July ___, 2004 made by
the Persons listed on the signature pages hereof and the Additional Grantors (as
defined in Section 17(b)) (the Persons so listed and the Additional Grantors
being, collectively, the "GRANTORS"), to Citibank, N.A., as Collateral Agent as
defined in the Credit Agreement (the "COLLATERAL AGENT") and its successors and
assigns as such.
PRELIMINARY STATEMENTS.
(1) Pride Offshore, Inc., a Delaware corporation ("PRIDE"), as
borrower (the "Borrower") and the Grantors have entered into a Credit Agreement
dated as of July 7, 2004 (as such agreement may be amended, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT") with the Lenders,
the Issuing Banks (as defined therein) and Citibank, N.A. as Collateral Agent
and Citicorp North America, Inc., as Administrative Agent (each as defined
therein). Terms defined in the Credit Agreement and not otherwise defined in
this Agreement are used in this Agreement as defined in the Credit Agreement.
(2) Pursuant to the Credit Agreement, the Grantors are entering into
this Agreement in order to grant to the Collateral Agent for the ratable benefit
of the Lenders, the Issuing Banks, and any Secured Hedge Provider a security
interest in the Collateral (as hereinafter defined).
(3) It is a condition precedent to the making of the Advances by the
Lenders and the issuance of any Letter of Credit by the Issuing Banks under the
Credit Agreement and the entry into any Hedging Agreements by any Secured Hedge
Provider from time to time that the Grantors shall have granted the assignment
and security interest and made the pledge and assignment contemplated by this
Agreement.
(4) Each Grantor will derive substantial direct and indirect benefit
from the transactions contemplated by the Credit Documents.
(5) Unless otherwise defined in this Agreement or in the Credit
Agreement, terms defined in Article 8 or 9 of the UCC (as defined below) are
used in this Agreement as such terms are defined in such Article 8 or 9. "UCC"
means the Uniform Commercial Code as in effect, from time to time, in the State
of New York; PROVIDED that, if perfection or the effect of perfection or
non-perfection or the priority of any security interest in any Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the State of New York, "UCC" means the Uniform Commercial Code as in effect
from time to time in such other jurisdiction for purposes of the provisions
hereof relating to such perfection, effect of perfection or non-perfection or
priority.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lenders to make the Advances and the Issuing Banks to issue any
Letter of Credit under the
Credit Agreement, to induce any Secured Hedge Provider to enter into any Hedging
Agreements, each Grantor hereby agrees with the Collateral Agent for the ratable
benefit of the Lenders, the Issuing Banks and any Secured Hedge Provider as
follows:
Section 1. Grant of Security. Each Grantor hereby grants to the
Collateral Agent, for the ratable benefit of the Lenders, the Issuing Banks and
any Secured Hedge Provider a security interest in such Grantor's right, title
and interest in and to the following, in each case, as to each type of property
described below, whether now owned or hereafter acquired by such Grantor,
wherever located, and whether now or hereafter existing or arising
(collectively, the "COLLATERAL"):
(a) all (i) drilling platforms and rigs (including but not limited
to those drilling platforms and rigs listed on Schedule II hereto (a "RIG"
or the "RIGS")), (ii) all drilling equipment, machinery and tools,
constituting a part thereof, and (iii) all accessions thereto and all
software that is embedded in and is part of the equipment (any and all
such property being the "EQUIPMENT");
(b) all inventory in all of its forms, including, without
limitation, (i) all raw materials, work in process, finished goods and
materials used or consumed in the manufacture, production, preparation or
shipping thereof, (ii) goods in which such Grantor has an interest in mass
or a joint or other interest or right of any kind (including, without
limitation, goods in which such Grantor has an interest or right as
consignee) and (iii) goods that are returned to or repossessed or stopped
in transit by such Grantor), and all accessions thereto and products
thereof and documents therefor, and all software that is embedded in and
is part of the inventory (any and all such property being the
"INVENTORY");
(c) (i) all accounts (including, without limitation, chattel paper
(including, without limitation, tangible chattel paper and electronic
chattel paper)), arising out of or in connection with the sale, use,
operation, pooling, chartering, or lease of goods or the Rigs, or the
rendering of services (whether or not earned by performance), (ii) all
rights now or hereafter existing in and to all supporting obligations and
in and to all security agreements, mortgages, Liens, leases, letters of
credit and other contracts securing the foregoing, and (iii) all moneys
and claims for moneys due and to become due to any Grantor, and all claims
for damages, arising out of the breach of any and all present and future
drilling contracts, charter parties, pooling arrangements, bills of
lading, contracts and other engagements of affreightment or for the use
and operations of every kind whatsoever of any Rig and in and to any and
all claims and causes of action for money, loss or damages that may accrue
or belong to any Grantor, its successors or assigns, arising out of or in
any way connected with the present or future use, operation, pooling or
chartering of any Rig hereto or arising out of or in any way connected
with any and all present and future requisitions, drilling contracts,
charter parties, pooling arrangements, bills of lading, contracts and
other engagements of affreightment or for the use and other operations of
any Rig hereto, (iv) all moneys and claims due and to become due to any
Grantor, and all claims for damages and all insurances and other proceeds,
in respect of the actual or constructive total loss of or requisition of
use of or title to any Rig hereto, and (v) any proceeds of any of the
foregoing (any and all of such
accounts and chattel paper, to the extent not referred to in clause (d)
below, being the "RECEIVABLES", and any and all such supporting
obligations, security agreements, mortgages, Liens, leases, letters of
credit and other contracts being the "SUPPORTING OBLIGATIONS");
(d) all books and records (including, without limitation, customer
lists, credit files, printouts and other computer output materials and
records) of such Grantor pertaining to any of the Collateral; and
(e) all proceeds of any and all of the Collateral (including,
without limitation, proceeds, collateral and supporting obligations that
constitute property of the types described in clauses (a) through (d) of
this Section 1 and this clause (e)) and, to the extent not otherwise
included, all payments received under insurance (whether or not the
Collateral Agent is the loss payee thereof), or under any indemnity,
warranty or guaranty, payable by reason of loss or damage to any of the
foregoing Collateral.
Section 2. Security for Secured Obligation. This Agreement hereby
secures, in the case of each Grantor, the payment of all Obligations and
(subject to Section 14(b)) Other Obligations of such Grantor now or hereafter
existing under the Credit Documents or any Hedging Agreement with a Secured
Hedge Provider (including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing Obligations
and Other Obligations), whether direct or indirect, absolute or contingent, and
whether for principal, reimbursement obligations, interest, premiums, penalties,
fees, indemnifications, contract causes of action, costs, expenses or otherwise
(all such obligations, being the "SECURED OBLIGATIONS"), and such Grantor agrees
to pay any and all expenses (including, without limitation, reasonable counsel
fees and expenses) incurred by the Collateral Agent or the Lenders in enforcing
any rights under this Agreement or any other Credit Documents. Without limiting
the generality of the foregoing, this Agreement secures, as to each Grantor, the
payment of all amounts that constitute part of the Secured Obligations and would
be owed by such Grantor to any Lender, the Issuing Banks, the Collateral Agent
or the Administrative Agent under the Credit Documents and any amount owed to
any Secured Hedge Provider but for the fact that they are unenforceable, or not
allowable, due to the existence of a bankruptcy, reorganization or similar
proceeding involving a Credit Party.
Section 3. Grantors Remain Liable. Anything herein to the contrary
notwithstanding, (a) each Grantor shall remain liable under the contracts,
including any drilling contracts, and agreements included in such Grantor's
Collateral to the extent set forth therein to perform all of its duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Collateral Agent of any of the rights
hereunder shall not release any Grantor from any of its duties or obligations
under the contracts and agreements included in the Collateral and (c) none of
the Lenders, Issuing Banks or Secured Hedge Provider shall have any obligation
or liability under the contracts, including any drilling contracts, and
agreements included in the Collateral by reason of this Agreement or any other
Credit Document or any Hedging Agreement, and none of the Lenders, Issuing Banks
or Secured Hedge Provider shall be obligated to perform any of the obligations
or duties of any Grantor thereunder or to take any action to collect or enforce
any claim for payment assigned hereunder.
Section 4. Representations and Warranties. Each Grantor represents
and warrants as of the date of this Agreement, as follows:
(a) Such Grantor's exact legal name, as provided in Section 9-503(a)
of the UCC, is correctly set forth in Schedule I hereto. Such Grantor is
located (within the meaning of Section 9-307 of the UCC) and has its chief
executive office, in the states or jurisdictions set forth in Schedule I
hereto. The information set forth in Schedule I hereto with respect to
such Grantor is true and accurate in all material respects. Such Grantor
has not, at any time in the six years immediately preceding the date of
this Agreement, changed its name, location (within the meaning of the
Section 9-307 of the UCC), chief executive office, type of organization or
jurisdiction of organization or organizational identification number from
those set forth in Schedule I hereto except as disclosed in Schedule III
hereto.
(b) Such Grantor is the legal and beneficial owner of the Collateral
of such Grantor free and clear of any Lien, except for the security
interest created under this Agreement and Liens permitted under the Credit
Agreement.
Section 5. Post-Closing Changes; Bailees; Collections on Receivables
and Related Contracts. (a) No Grantor will change its name, type of
organization, jurisdiction of organization, organizational identification number
or location (within the meaning of Section 9-307 of the UCC) from those set
forth in Section 4(a) of this Agreement without compliance with the requirements
of the Credit Agreement and without first giving at least 30 days' prior written
notice to the Collateral Agent and taking all action reasonably required by the
Collateral Agent for the purpose of perfecting or protecting the security
interest granted by this Agreement. Except as otherwise permitted by the Credit
Agreement, no Grantor will become bound by a security agreement authenticated by
another Person (determined as provided in Section 9-203(d) of the UCC) without
taking all action required by the Collateral Agent to ensure that the perfection
of the Collateral Agent's security interest in the Collateral will be
maintained. If any Grantor does not have an organizational identification number
and later obtains one, it will forthwith notify the Collateral Agent of such
organizational identification number.
(b) Except as otherwise provided in this subsection (b), each
Grantor will continue to use commercially reasonable efforts to collect, at its
own expense, all amounts due or to become due such Grantor under the Receivables
and Supporting Obligations. The Collateral Agent shall have the right at any
time, upon the occurrence and during the continuance of an Event of Default and
upon written notice to such Grantor of its intention to do so, to notify the
obligors under any Receivables and Supporting Obligations of the assignment of
such Receivables and Supporting Obligations to the Collateral Agent and to
direct such obligors to make payment of all amounts due or to become due to such
Grantor thereunder directly to the Collateral Agent and, upon such notification
and at the expense of such Grantor, to enforce collection of any such
Receivables and Supporting Obligations, in the same manner and to the same
extent as such Grantor might have done, and to otherwise exercise all rights
with respect to such Receivables and Supporting Obligations, including, without
limitation, those set forth in Section 9-607 of the UCC. After receipt by any
Grantor of the notice from the Collateral Agent referred to in the preceding
sentence and during the continuance of the Event of Default to which such notice
relates, all amounts and proceeds (including, without limitation, instruments)
received by such Grantor in respect of the
Receivables and Supporting Obligations of such Grantor shall be held and applied
by the Collateral Agent from time to time as provided in the Credit Agreement.
No Grantor will consent to the subordination of its right to payment under any
of the Receivables and Supporting Obligations to any other indebtedness or
obligations of the obligor thereof.
Section 6. Transfers and Other Liens. Each Grantor agrees that it
will not (i) sell, assign or otherwise dispose of, or grant any option with
respect to, any of the Collateral, other than sales, assignments and other
dispositions of Collateral, and options relating to Collateral, permitted under
the terms of the Credit Agreement, or (ii) create or suffer to exist any Lien
upon or with respect to any of the Collateral of such Grantor except Liens
permitted under the Credit Agreement.
Section 7. Collateral Agent Appointed Attorney-in-Fact. Each Grantor
hereby irrevocably appoints the Collateral Agent such Grantor's
attorney-in-fact, with full authority in the place and stead of such Grantor and
in the name of such Grantor or otherwise, from time to time, upon the occurrence
and during the continuance of an Event of Default and upon written notice to
such Grantor of its intention to do so, in the Collateral Agent's discretion, to
take any commercially reasonable action and to execute any instrument that the
Collateral Agent may deem necessary to accomplish the purposes of this
Agreement, including, without limitation:
(a) to obtain and adjust insurance required to be paid to the
Collateral Agent pursuant to the Credit Agreement,
(b) to ask for, demand, collect, ▇▇▇ for, recover, receive and give
acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral,
(c) to receive, indorse and collect any drafts or other instruments,
documents and chattel paper, in connection with clause (a) or (b) above,
and
(d) to file any claims or take any action or institute any
proceedings that the Collateral Agent may deem necessary or desirable for
the collection of any of the Collateral or otherwise to enforce the rights
of the Collateral Agent with respect to any of the Collateral.
Section 8. Collateral Agent May Perform. If any Grantor fails to
perform any agreement contained herein, the Collateral Agent may, as the
Collateral Agent reasonably deems necessary to protect the security interest
granted hereunder in the Collateral or to protect the value thereof, but without
any obligation to do so and without notice, itself perform, or cause performance
of, such agreement, and the expenses of the Collateral Agent incurred in
connection therewith shall be payable by such Grantor in accordance with this
Agreement.
Section 9. The Collateral Agent's Duties. (a) The powers conferred
on the Collateral Agent hereunder are solely to protect the Lenders', the
Issuing Banks's and any Secured Hedge Provider's interest in the Collateral and
shall not impose any duty upon it to exercise any such powers. Except for the
safe custody of any Collateral in its possession and the accounting for moneys
actually received by it hereunder, the Collateral Agent shall have no duty
as to any Collateral, as to ascertaining or taking action with respect to
matters relative to any Collateral, whether or not any Lender, the Issuing Banks
or any Secured Hedge Provider has or is deemed to have knowledge of such
matters, or as to the taking of any necessary steps to preserve rights against
any parties or any other rights pertaining to any Collateral. The Collateral
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of any Collateral in its possession if such Collateral is accorded
treatment substantially equal to that which it accords its own property.
(b) Anything contained herein to the contrary notwithstanding, the
Collateral Agent may from time to time, when the Collateral Agent deems it to be
necessary, appoint one or more subagents (each, a "SUBAGENT") for the Collateral
Agent hereunder with respect to all or any part of the Collateral located
outside the United States (including its coastal waters). In the event that the
Collateral Agent so appoints any Subagent with respect to any Collateral, (i)
such Subagent shall automatically be vested, in addition to the Collateral
Agent, with all rights, powers, privileges, interests and remedies of the
Collateral Agent hereunder with respect to such Collateral, and (ii) the term
"Collateral Agent," when used herein in relation to any rights, powers,
privileges, interests and remedies of the Collateral Agent with respect to such
Collateral, shall include such Subagent; PROVIDED, HOWEVER, that no such
Subagent shall be authorized to take any action with respect to any such
Collateral unless and except to the extent expressly authorized in writing by
the Collateral Agent, with a copy delivered to the Grantors.
Section 10. Remedies. If any Event of Default shall have occurred
and be continuing:
(a) The Collateral Agent may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a lender upon default
under the UCC (whether or not the UCC applies to the affected Collateral)
and also may: (i) require each Grantor to, and each Grantor hereby agrees
that it will at its expense and upon request of the Collateral Agent
forthwith, assemble all or part of the Collateral as directed by the
Collateral Agent and make it available to the Collateral Agent at one or
more places and times to be designated by the Collateral Agent that are
reasonably convenient to both parties; (ii) without notice except as
specified below or as required by applicable law, sell the Collateral or
any part thereof in one or more parcels at public or private sale, at any
of the Collateral Agent's offices or elsewhere, for cash, on credit or for
future delivery, and upon such other terms as the Collateral Agent may
deem commercially reasonable; and (iii) exercise any and all rights and
remedies of any of the Grantors under or in connection with the
Collateral, or otherwise in respect of the Collateral, including, without
limitation, (A) any and all rights of such Grantor to demand or otherwise
require payment of any amount under, or performance of any provision of,
the Receivables, the Supporting Obligations and the other Collateral, and
(B) exercise all other rights and remedies with respect to the
Receivables, the Supporting Obligations and the other Collateral,
including, without limitation, those set forth in Section 9-607 of the
UCC. Each Grantor agrees that, to the extent notice of sale shall be
required by law, at least ten Business Days' notice to such Grantor of the
time and place of any public sale or the time after which any private sale
is to be made shall constitute commercially reasonable notification. The
Collateral Agent shall not be obligated to
make any sale of Collateral regardless of notice of sale having been
given. The Collateral Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to
which it was so adjourned.
(b) Any cash held by or on behalf of the Collateral Agent and all
cash proceeds received by or on behalf of the Collateral Agent in respect
of any sale of, collection from, or other realization upon all or any part
of the Collateral may, in the discretion of the Collateral Agent, be held
by the Collateral Agent as collateral for, and/or then or at any time
thereafter applied (after payment of any amounts payable to the Collateral
Agent pursuant to Section 14 hereof) in whole or in part by the Collateral
Agent for the ratable benefit of the Lenders, the Issuing Banks, the
Secured Hedge Provider against, all or any part of the Secured Obligation,
in the manner provided in Section 6.03 of the Credit Agreement.
Section 11. Amendments; Waivers; Additional Grantors; Etc. (a) No
amendment or waiver of any provision of this Agreement, and no consent to any
departure by any Grantor herefrom, shall in any event be effective unless in
accordance with Article 10.01 of the Credit Agreement.
(b) Upon the execution and delivery, or authentication, by any
Person of a security agreement supplement in substantially the form of Exhibit A
hereto (each a "SECURITY AGREEMENT SUPPLEMENT"), (i) such Person shall be
referred to as an "ADDITIONAL GRANTOR" and shall be and become a Grantor
hereunder, and each reference in this Agreement and the other Credit Documents
to "Grantor" shall thereafter also mean and be a reference to such Additional
Grantor, and, where the context so permits, each reference in this Agreement and
the other Credit Documents to "Collateral" shall thereafter also mean and be a
reference to the Collateral of such Additional Grantor, and (ii) the
supplemental Schedules I-III attached to each Security Agreement Supplement
shall be incorporated into and become a part of and supplement Schedules I-III,
respectively, hereto, and the Collateral Agent may attach such supplemental
schedules to such Schedules; and each reference to such Schedules shall mean and
be a reference to such Schedules as supplemented pursuant to each Security
Agreement Supplement.
Section 12. Notices, Etc. All notices and other communications
provided for hereunder shall be delivered pursuant to and in accordance with the
Credit Agreement.
Section 13. Continuing Security Interest; Assignments Under the
Credit Agreement. This Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until the later of
(i) the payment in full in cash of the Secured Obligations other than those
owing to Secured Hedge Providers and (ii) the separate cash collateralization of
all outstanding Letters of Credit, (b) be binding upon each Grantor, its
successors and assigns and (c) inure, together with the rights and remedies of
the Collateral Agent hereunder, to the benefit of the Lenders, the Issuing Banks
and any Secured Hedge Provider and their respective successors and permitted
assigns.
Section 14. Release; Termination. (a) Upon any sale, lease, transfer
or other disposition of any item of Collateral of any Grantor in accordance with
the terms of the Credit
Documents (other than sales of Inventory in the ordinary course of business),
the Collateral Agent will, at such Grantor's expense, execute and deliver to
such Grantor such documents as such Grantor shall reasonably request to evidence
the release of such item of Collateral from the assignment and security interest
granted hereby; PROVIDED, HOWEVER, that (i) at the time of such request and such
release no Default or Event of Default shall have occurred and be continuing,
(ii) such Grantor shall have delivered to the Collateral Agent, at least 2
Business Days prior to the date of the proposed release, a written request for
release describing the item of Collateral and the material terms of the sale,
lease, transfer or other disposition in reasonable detail, including, without
limitation, the price thereof and any expenses in connection therewith, together
with a form of release for execution by the Collateral Agent and a certificate
of such Grantor to the effect that the transaction is in compliance with the
Credit Documents and (iii) the portion (if any) of proceeds of any such sale,
lease, transfer or other disposition required to be applied, or any payment to
be made in connection therewith, in accordance with Section 2.04(e) of the
Credit Agreement shall, to the extent so required, be paid or made to, or in
accordance with the instructions of, the Collateral Agent when and as required
under Section 2.04(h) of the Credit Agreement.
(b) Upon the later of (i) the payment in full in cash of the Secured
Obligations other than those owing to Secured Hedge Providers and (ii) the
separate cash collateralization of all outstanding Letters of Credit, the
security interest granted hereby shall terminate and all rights to the
Collateral shall revert to the applicable Grantor. Upon any such termination,
the Collateral Agent will, at the applicable Grantor's expense, execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence such termination.
Section 15. Security Interest Absolute. The obligations of each
Grantor under this Agreement are independent of the Secured Obligation or any
other Secured Obligation of any other Credit Party under or in respect of the
Credit Documents, and a separate action or actions may be brought and prosecuted
against each Grantor to enforce this Agreement, irrespective of whether any
action is brought against such Grantor or any other Credit Party or whether such
Grantor or any other Credit Party is joined in any such action or actions. All
rights of the Collateral Agent and the other Lenders and the assignment and
security interest hereunder, and all obligations of each Grantor hereunder,
shall be irrevocable, absolute and unconditional irrespective of, and each
Grantor hereby irrevocably waives (to the maximum extent permitted by applicable
law) any defenses it may now have or may hereafter acquire in any way relating
to, any or all of the following:
(a) any lack of validity or enforceability of any Credit Document or
any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations or any other Secured
Obligations of any other Credit Party under or in respect of the Credit
Documents or any other amendment or waiver of or any consent to any
departure from any Credit Document, including, without limitation, any
increase in the Secured Obligations resulting from the extension of
additional credit to any Credit Party or any of its Subsidiaries or
otherwise;
(c) any taking, exchange, release or non-perfection of any
Collateral or any other collateral, or any taking, release or amendment or
waiver of or consent to departure from any guaranty, for all or any of the
Secured Obligations;
(d) any manner of application of any Collateral or any other
collateral, or proceeds thereof, to all or any of the Secured Obligations,
or any manner of sale or other disposition of any Collateral or any other
collateral for all or any of the Secured Obligations or any other Secured
Obligations of any other Credit Party under or in respect of the Credit
Documents or any other assets of any Credit Party or any of its
Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Credit Party or any of its Subsidiaries;
(f) any failure of any Lender to disclose to any Credit Party any
information relating to the business, condition (financial or otherwise),
operations, performance, assets, nature of assets, liabilities or
prospects of any other Credit Party now or hereafter known to such Lender
(each Grantor waiving any duty on the part of the Lenders to disclose such
information);
(g) the failure of any other Person to execute this Agreement or any
other Collateral Document, guaranty or agreement or the release or
reduction of liability of any Grantor or other grantor or surety with
respect to the Secured Obligation; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by any Lender that might otherwise constitute a defense
available to, or a discharge of, such Grantor or any other Grantor or a
third party grantor of a security interest.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Secured Obligations are rescinded
or must otherwise be returned by any Lender or by any other Person upon the
insolvency, bankruptcy or reorganization of any Credit Party or otherwise, all
as though such payment had not been made.
Section 16. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement. Delivery of an executed counterpart of a signature page
to this Agreement by telecopier shall be effective as delivery of an original
executed counterpart of this Agreement.
Section 17. The Mortgages. In the event that any of the Collateral
hereunder is also subject to a valid and enforceable Lien under the terms of any
Vessel Mortgage or related Assignment of Insurances and the terms of such Vessel
Mortgage are inconsistent with the terms of this Agreement, then with respect to
such Collateral, the terms of such Vessel Mortgage and related Assignment of
Insurances shall be controlling, and the terms of this Agreement shall be
controlling in the case of all other Collateral.
Section 18. Governing Law; Entire Agreement(a) . This Agreement
shall be governed by, and construed in accordance with, the laws of the State of
New York without regard to its conflicts of law rules (other than Section 5-1401
of the New York General Obligations Law). This Agreement constitutes the entire
understanding among the parties hereto with respect to the subject matter hereof
and supersede any prior agreements, written or oral, with respect thereto.
Section 19. Waiver of Jury Trial. Each of the Grantors and the
Collateral Agent irrevocably waive any and all rights to trial by jury in any
legal proceeding arising out of or relating to this Agreement or any of the
transactions contemplated hereby.
IN WITNESS WHEREOF, each Grantor has caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.
PRIDE OFFSHORE, INC., as Borrower
By:______________________________
Name:
Title:
MEXICO DRILLING LIMITED LLC
By:______________________________
Name:
Title:
PRIDE CENTRAL AMERICA, LLC
By:______________________________
Name:
Title:
PRIDE OFFSHORE INTERNATIONAL LLC
By:______________________________
Name:
Title:
PRIDE SOUTH PACIFIC LLC
By:______________________________
Name:
Title:
PRIDE DRILLING, LLC
By:______________________________
Name:
Title:
PRIDE - Security Agreement
PRIDE NORTH AMERICA LLC
By:______________________________
Name:
Title:
Acknowledged and Accepted:
CITIBANK, N.A.
By: __________________________
Name:
Title:
SCHEDULE I TO THE
SECURITY AGREEMENT
LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION,
JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION
NUMBER
CHIEF
EXECUTIVE TYPE OF JURISDICTION OF ORGANIZATIONAL
GRANTOR LOCATION OFFICE ORGANIZATION ORGANIZATION I.D. NO.
------- -------- ------ ------------ ------------ --------------
SCHEDULE II TO THE
SECURITY AGREEMENT
LIST OF RIGS
NAME OWNER
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SCHEDULE III TO THE
SECURITY AGREEMENT
CHANGES IN NAME, LOCATION, ETC.
CHANGES IN THE GRANTOR'S NAME (INCLUDING NEW GRANTOR WITH A NEW NAME)
None.
CHANGES IN THE GRANTOR'S LOCATION
None.
CHANGES IN THE GRANTOR'S CHIEF EXECUTIVE OFFICE
None.
CHANGES IN THE TYPE OF ORGANIZATION
None.
CHANGES IN THE JURISDICTION OF ORGANIZATION
Pride International, Inc. was a Louisiana corporation until 2001
CHANGES IN THE ORGANIZATIONAL IDENTIFICATION NUMBER
None.
EXHIBIT A TO THE
SECURITY AGREEMENT
FORM OF SECURITY AGREEMENT SUPPLEMENT
[Date of Security Agreement Supplement]
Citibank, N.A.
as the Collateral Agent for the
Lenders referred to in the
Credit Agreement referred to below
[Address]
Attn: ___________________
Ladies and Gentlemen:
Reference is made to (i) the Credit Agreement dated July 7, 2004 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"; terms defined therein, unless otherwise defined
herein, being used herein as therein defined), among Pride Offshore, Inc.
(the"Borrower"), the Lenders, Citibank, N.A., as Collateral Agent and Citicorp
North America, Inc., as Administrative Agent, the Issuing Banks (as defined
therein), and (ii) the Security Agreement dated July 7, 2004 (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
"SECURITY AGREEMENT") made by the Grantors from time to time party thereto in
favor of the Collateral Agent for the Lenders, the Issuing Banks and any Secured
Hedge Provider.
SECTION 1. Grant of Security. The undersigned hereby grants to the
Collateral Agent, for the ratable benefit of the Lenders, the Issuing Banks and
any Secured Hedge Provider a security interest in, all of its right, title and
interest in and to all of the Collateral of the undersigned, whether now owned
or hereafter acquired by the undersigned, wherever located and whether now or
hereafter existing or arising, including, without limitation, the property and
assets of the undersigned set forth on the attached supplemental schedules to
the Schedules to the Security Agreement.
SECTION 2. Security for Secured Obligations. The grant of a security
interest in, the Collateral by the undersigned under this Security Agreement
Supplement and the Security Agreement secures the payment of all Secured
Obligations of the undersigned now or hereafter existing under or in respect of
the Credit Documents or any Hedging Agreement with a Secured Hedge Provider,
whether direct or indirect, absolute or contingent, and whether for principal,
reimbursement obligations, interest, premiums, penalties, fees,
indemnifications, contract causes of action, costs, expenses or otherwise.
Without limiting the generality of the foregoing, this Security Agreement
Supplement and the Security Agreement secures the payment of all amounts that
constitute part of the Secured Obligation and that would be owed by the
undersigned to any Lender under the Credit Documents but for the fact that such
Secured Obligation are
unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving a Credit Party.
SECTION 3. Supplements to Security Agreement Schedules. The
undersigned has attached hereto supplemental Schedules I through III to
Schedules I through III, respectively, to the Security Agreement, and the
undersigned hereby certifies, as of the date first above written, that such
supplemental schedules have been prepared by the undersigned in substantially
the form of the equivalent Schedules to the Security Agreement and are complete
and correct in all material respects.
SECTION 4. Representations and Warranties. The undersigned hereby
makes, as of the date hereof, each representation and warranty set forth in
Section 4 of the Security Agreement (as supplemented by the attached
supplemental schedules) to the same extent as each other Grantor.
SECTION 5. Obligations Under the Security Agreement. The undersigned
hereby agrees, as of the date first above written, to be bound as a Grantor by
all of the terms and provisions of the Security Agreement to the same extent as
each of the other Grantors. The undersigned further agrees, as of the date first
above written, that each reference in the Security Agreement to an "Additional
Grantor" or a "Grantor" shall also mean and be a reference to the undersigned.
SECTION 6. Governing Law; Entire Agreement. This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New York
without regard to its conflicts of law rules (other than Section 5-1401 of the
New York General Obligations Law). This Agreement, together with the Security
Agreement, constitutes the entire understanding among the parties hereto with
respect to the subject matter hereof and supersede any prior agreements, written
or oral, with respect thereto.
SECTION 7. Waiver of Jury Trial. Each of the Grantors and the
Collateral Agent irrevocably waive any and all rights to trial by jury in any
legal proceeding arising out of or relating to this Agreement or any of the
transactions contemplated hereby.
PRIDE - Security Agreement
Very truly yours,
[NAME OF ADDITIONAL GRANTOR]
By _________________________
Title:
Address for notices:
_____________________
_____________________
_____________________
EXHIBIT I-1
FORM OF PLEDGE AGREEMENT (DELAWARE)
THIS PLEDGE OF SHARES is made on July 7, 2004
BETWEEN:
(1) PRIDE INTERNATIONAL, INC., a corporation incorporated under the laws of
the State of Delaware ("PLEDGOR"); and
(2) CITIBANK, N.A., a Delaware corporation for and on behalf of itself and the
Lender Parties (the "PLEDGEE") (which expression shall include its
successors, permitted assigns and permitted transferees from time to
time).
RECITALS
(A) Pledgor is the sole legal and beneficial holder of 100% of the issued
shares in the share capital of the Pride Offshore, Inc., a corporation
incorporated under the laws of the State of Delaware (the "BORROWER"),
being the entire issued shares in the share capital of the Borrower, as
further described in Schedule I hereof.
(B) Pursuant to the Credit Agreement dated July 7, 2004 (the "CREDIT
AGREEMENT") between the Borrower, the Lenders named therein, the
Guarantors named therein (including the Pledgor), the Issuing Banks (as
defined therein), Citicorp North America, Inc. as Administrative Agent and
the Pledgee as Collateral Agent, the Lenders have agreed to make available
to the Borrower the facilities referred to therein on the terms and
subject to the conditions contained therein.
(C) It is a condition precedent to the Pledgee and the other Lender Parties
under the Credit Agreement that the Pledgor execute this Pledge pursuant
to which the Pledgor will pledge 100% of the issued shares of the Borrower
(the "EXISTING SECURITIES").
IT IS AGREED:
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined shall be used
herein as defined in the Credit Agreement.
2. PLEDGE
2.1 In consideration of the Pledgee and the Lender Parties agreeing to enter
into the Credit Documents and the Hedging Agreements (if any) and as
security for the due and punctual performance of the Obligations, the
Pledgor as sole legal and beneficial owner of: (i) the Existing
Securities, (ii) any and all other issued shares in the Borrower from time
to time owned by the Pledgor from the period commencing on the date hereof
and terminating on the date upon which all of the Obligations, except the
Other Obligations, have been paid in full (such period being the "SECURITY
PERIOD"), and (iii) all other shares, stocks, securities, grants and all
rights, monies and property
1
whatsoever, including all dividends or other distributions and interest
paid or payable thereon, which may at any time be derived from, accrue on
or be offered in respect of, the Existing Securities and/or any or all of
the issued shares referred to in (ii) above or comprised in any security
created pursuant hereto, whether by way of redemption, exchange,
conversion, option rights, bonus, preference, capital reorganisation or
otherwise howsoever ((i) - (iii) being the "PLEDGED PROPERTY"), hereby
mortgages, assigns, pledges and hypothecates unto the Pledgee a first
priority security interest, charge and mortgage in all and singular of its
respective rights, title and interests and privileges, whether now owned
or hereafter acquired in, to and over the Pledged Property and each part
thereof.
2.2 Upon payment in full of the Obligations under the Credit Documents, a
Permitted Restructuring or other transaction permitted by the Credit
Agreement that requires the security hereby constituted by this Pledge to
be released as contemplated by the Credit Agreement, the Pledgee shall
upon the request of the Pledgor, discharge the security hereby constituted
by this Pledge and return the items listed in Clause 10.1.1, to the
Pledgor.
3. PLEDGOR'S LIABILITY NOT AFFECTED
3.1 The Pledgor's liability to the Pledgee and each of the Lender Parties
under this Pledge shall not be discharged or impaired by reason of any of
the following events or circumstances (regardless of whether any such
events or circumstances occur with or without the Pledgor's knowledge or
consent):
3.1.1 any time, forbearance or other indulgence given or agreed by the
Pledgee and/or any Lender Party to or with any other person in
respect of any of their respective obligations under any of the
Credit Documents; or
3.1.2 any legal limitation, disability or incapacity relating to any
Credit Party or any other person; or
3.1.3 any invalidity, irregularity, unenforceability, imperfection or
avoidance of or any defect in any security granted by, or the
obligations of any Credit Party or any other person under any of the
Credit Documents or any amendment to or variation thereof or of any
other document or security comprised therein (in accordance with the
terms thereof); or
3.1.4 any change in the name, constitution or otherwise of any Credit
Party or any other person or the merger of any Credit Party or any
other person by or with any other corporate entity; or
3.1.5 the liquidation, bankruptcy or dissolution (or proceedings analogous
thereto) of any Credit Party or any other person or the appointment
of a receiver or administrative receiver or administrator or trustee
or similar officer of any of the assets of any Credit Party or any
other person or the occurrence of any circumstances whatsoever
affecting such Credit Party's or any other person's liability to
discharge its respective obligations under any of the Credit
Documents; or
2
3.1.6 any release, renewal, exchange or realisation of any security or
obligation provided under or by virtue of any of the Credit
Documents (other than as provided in this Pledge) or the provision
to the Pledgee and/or any Lender Party at any time of any further
security for the obligations of any Credit Party or any other person
under any of the Credit Documents; or
3.1.7 any failure on the part of the Pledgee and/or any Lender Party to
take or perfect any security agreed to be taken under or in relation
to any of the Credit Documents; or
3.1.8 any other act, matter or thing which might otherwise constitute a
legal or equitable discharge of any of the Pledgor's obligations
under this Pledge other than the payment in full of the Obligations
under the Credit Documents.
3.2 The Pledgee agrees that, notwithstanding the provisions of Clause 3.1, no
recourse shall be had to any assets of the Pledgor in respect of any of
the Obligations and/or any of the Pledgor's obligations hereunder and,
absent negligence or wilful misconduct on the part of the Pledgor, the
Pledgee hereby acknowledges that it will have no further claim against, or
recourse to, the assets of the Pledgor in respect of such obligations. In
addition, absent negligence or wilful misconduct on the part of the
Pledgor, where compliance with the obligations imposed on the Pledgor
under this charge would require the expenditure by the Pledgor of its own
funds, the obligations of the Pledgor shall be limited to the extent that
it is in funds to meet such expenditure.
3.3 The Pledgee agrees not to seek before any court or governmental agency to
have any shareholder, director or officer of the Pledgor held liable for
any actions or inactions of the Pledgor or any obligations of the Pledgor
under the Credit Documents, except if such actions or inactions are the
result of the fraud or wilful default or recklessness with wilful
disregard or gross negligence of the probable consequences of such
shareholder, director or officer.
3.4 The Pledgee agrees that it shall not take any action to commence any case,
proceeding, proposal or other action under any existing or further law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganisation, arrangement in the nature of insolvency proceedings,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to the Pledgor or the debts of the Pledgor other than
to obtain a declaratory judgment or to seek to enforce and realise its
security under the Pledged Property.
4. CONTINUING PLEDGE
4.1 This Pledge shall be a continuing security and accordingly, except as
provided in this Pledge or in the Credit Agreement:
4.1.1 shall not be discharged by any partial payment or performance by the
Pledgor or any other person under or in respect of any of the Credit
Documents;
4.1.2 shall extend to cover the balance due at any time from any other
Credit Party to the Pledgee and/or any Lender Party under or in
respect of any of the Credit Documents;
3
4.1.3 shall be in addition to and not in substitution for or derogation of
any other security which the Pledgee and/or any Lender Party may at
any time hold in respect of the obligations of any other Credit
Party under or in respect of any of the Credit Documents or the
transactions contemplated thereby; and
4.1.4 except to the extent that the Pledgee expressly waives in writing
the Pledgor's obligations under this Pledge, shall not be discharged
or in any way adversely affected by any action taken or not taken by
the Pledgee and/or any Lender Party.
4.2 Any release or discharge of the security constituted by this Pledge, to
the extent made on the basis of granting of security, or the making of a
disposition or payment, to the Pledgee and/or any Lender Party under the
Credit Documents, shall be conditional upon such security disposition, or
payment not being void, avoided, set aside or ordered to be refunded
pursuant to any enactment or law relating to bankruptcy, liquidation or
insolvency or for any reason whatsoever and, if such condition shall not
be fulfilled, the Pledgee shall be entitled to enforce this Pledge
subsequently as if such release or discharge to the extent made on the
basis of such security, disposition or payment, had not occurred and any
such security, disposition or payment had not been made.
5. EXCLUSION OF THE PLEDGOR'S RIGHTS
5.1 Until the Obligations under the Credit Documents have been discharged in
full, the Pledgor shall not:
5.1.1 following the occurrence of a Event of Default which is continuing
be entitled to share in or succeed to or benefit from (by
subrogation or otherwise) any rights the Pledgee and/or any Lender
Party may have in respect of the Obligations or any related security
or all or any of the proceeds of such rights or security; or
5.1.2 without the prior written consent of the Pledgee:
(a) prove in a liquidation of the Borrower in competition with the
Pledgee and/or any Lender Party for any monies owing to the
Pledgor by the Borrower on any account whatsoever; or
(b) following the occurrence of a Event of Default which is
continuing exercise any right of set-off or counterclaim to
which the Pledgor may be entitled against the Borrower, except
as required by applicable law,
provided that if the Pledgor, in breach of this Clause 5.1, receives
or recovers any monies pursuant to any such exercise, claim or
proof, such monies shall be held by the Pledgor upon trust for the
Pledgee and/or any Lender Party to apply the same as if they were
monies received or recovered by the Pledgee under this Pledge.
6. EXERCISE OF RIGHTS
6.1 Unless and until a Event of Default shall have occurred and be continuing,
the Pledgor shall be entitled to receive and retain all dividends and
other distributions made on or in respect of the
4
Pledged Property and to exercise all voting rights attaching to the
Existing Securities or any thereof for all purposes.
6.2 If a Event of Default shall have occurred and be continuing the Pledgee
shall, without prejudice to any other right or remedy available hereunder
or under applicable law, forthwith become entitled:
6.2.1 upon notice to the Pledgor and the Borrower, solely and exclusively
to all the voting rights attaching to the Pledged Property or any
thereof and the Pledgor shall exercise such rights in such manner as
the Pledgee may in its commercially reasonable discretion determine;
and/or
6.2.2 to receive and, pursuant to Section 6.03 of the Credit Agreement,
apply all dividends and other distributions made on or in respect of
the Pledged Property or any part thereof and any such dividends and
other distributions received by the Pledgor after such time shall be
held in trust by the Pledgor for the Pledgee and be paid or
transferred to the Pledgee on demand; and/or
6.2.3 upon at least ten (10) Business Days' notice to, but without consent
or concurrence by, the Pledgor to sell the Pledged Property or any
part thereof by such method, at such place and upon such terms as
the Pledgee may determine in accordance with applicable law, with
power to postpone any such sale and in any such case the Pledgee may
exercise any and all rights attaching to the Pledged Property as the
Pledgee in its commercially reasonable discretion may determine and
without being answerable for any loss occasioned by such sale or
resulting from postponement thereof or the exercise of such rights;
upon any sale of the Pledged Property or any part thereof the
purchaser thereof shall not be bound to see or enquire whether the
power of sale of the Pledgee has arisen in the manner herein
provided and the sale shall be deemed to be within the power of the
Pledgee and the receipt of the Pledgee for the purchase money shall
effectively discharge the purchaser of the Pledged Property, or any
part thereof, who shall not be concerned or be in any way answerable
therefor.
6.3 Following the occurrence of an Event of Default which is continuing and if
the Pledgee so requests, the Pledgor shall procure that the Borrower
forthwith enter the relevant details of the Pledgee or its nominee as
shareholder in respect of the Pledged Property in the register of members
of the Borrower upon presentation of the properly completed executed share
transfer form and satisfaction of any applicable legal requirements.
7. FURTHER ASSURANCE
The Pledgor covenants with the Pledgee that it shall from time to time and
at all times whether before or after the security constituted by this
Pledge shall have become enforceable at the request of the Pledgee, and at
the Pledgor's cost and expense, take such actions and execute such
additional documents as the Pledgee may reasonably require to perfect or
give full effect to this Pledge or for securing the rights hereunder of
the Pledgee and each of the Lenders.
5
8. POWER OF ATTORNEY
8.1 The Pledgor hereby irrevocably and by way of security appoints the Pledgee
to be its attorney (such attorney to have power, upon notice to the
Pledgor, to appoint substitute attorneys and to revoke the appointment
thereof at any time) for and on the Pledgor's behalf and in the Pledgor's
name and as the Pledgor's act and deed:
8.1.1 to execute, seal and deliver and otherwise perfect any such document
as is mentioned in Clause 7 hereof;
8.1.2 to do all such acts and execute, deliver and perfect all such
documents as the Pledgor itself could do or execute with reference
to or in connection with any of the matters dealt with in this
Pledge or any documents contemplated by or entered into pursuant
hereto or thereto or which may be required or deemed proper for any
of the purposes of the security constituted by this Pledge or any
documents contemplated by or entered into pursuant hereto or thereto
and to use the Pledgor's name in the exercise of all or any of the
powers conferred by this Pledge or any documents contemplated by or
entered into pursuant hereto or thereto upon the Pledgee, and to
complete and date (without prejudice to the generality of the
foregoing) the share transfer form referred to in Clause 10.1.1, and
to instruct the directors of the Borrower to enter the relevant
details of the Pledgee or its nominee as shareholder in respect of
the Pledged Property in the register of shares of the Borrower,
provided always that (i) unless otherwise agreed by the Pledgor, such
power shall not be exercisable by or on behalf of the Pledgee until a
Event of Default has occurred and is continuing, and (ii) no such attorney
shall in the exercise of such power cause the Pledgor to incur
obligations, or liabilities for expenditures, other than those expressly
contemplated by this Pledge.
8.2 The power of attorney hereby granted is as regards the Pledgee and any
substitute attorney (and as the Pledgor hereby acknowledges) granted
irrevocably and for value as part of the security granted by this Pledge
to secure proprietary interests in and the performance of obligations owed
to the Pledgee.
9. REPRESENTATIONS AND WARRANTIES
9.1 The Pledgor represents and warrants at the date hereof that, save as
permitted by the Credit Documents or otherwise by the Pledgee:
9.1.1 it is the sole legal and beneficial owner of all of the shares
comprised in the Existing Securities being the entire issued shares
in the share capital of the Borrower;
9.1.2 that the Existing Securities are fully paid up and are not subject
to any options;
9.1.3 none of the Pledged Property is subject to any encumbrance or
security interest whatsoever, howsoever created or arising including
any right of ownership, security, mortgage, pledge, assignment by
way of security, charge, lease, lien, statutory right in rem,
hypothecation, title retention arrangement, attachment, levy, claim,
right of detention
6
or security interest whatsoever, howsoever created or arising or any
right or arrangement having a similar effect to any of the above
(the foregoing, a "LIEN") other than Collateral Permitted Liens or
as created pursuant to this Pledge or the other Security Documents;
9.1.4 it has not taken any action nor, to its knowledge or the knowledge
of its officers, have any steps been taken or legal proceedings been
started for the winding-up, dissolution or reorganisation or for
the appointment of a receiver or administrative receiver, or an
administrator, trustee or similar officer of it or of all or
substantially all of its assets; and
9.1.5 the obligations of the Pledgor under the Credit Documents to which
it is or is to be a party are, or will when the same are executed be
at least pari passu with all other present and future obligations of
the Pledgor save for obligations mandatorily preferred by law.
9.2 Each of representations contained herein is made and each of the
warranties contained is given without condition or qualification save as
expressly stated therein.
9.3 The rights and remedies of the Pledgee and/or any Lender Party in relation
to any misrepresentation or breach of warranty on the part of the Pledgor
shall not be prejudiced by the Pledgor, by the performance of this Pledge
or by any other act or thing which may be done by it in connection with
this Pledge and which would apart from this sub-clause prejudice such
rights or remedies.
9.4 The representations and warranties set out in Clause 9.1 shall survive the
execution of this Pledge and shall be deemed to be repeated on the date of
each Advance or issuance of a Letter of Credit, in each case as though
made with reference to the facts and circumstances then subsisting on such
date.
10. UNDERTAKINGS
10.1 The Pledgor undertakes to the Pledgee that it shall, on the date of this
Pledge deliver, or procure that there is delivered, to the Pledgee by way
of security:
10.1.1 (i) the share certificate representing the Existing Securities
comprised in the Pledged Property and (ii) an executed and undated
share transfer form (in the form of Schedule 2) in respect of such
shares in which the identity of the transferee shall be left blank
and which shall be duly executed by the Pledgor; and
10.1.2 certified copies of the register of members of the Borrower duly
marked to indicate the Lien created pursuant to this Pledge.
10.2 The Pledgor shall not, without the prior written consent of the Pledgee or
as otherwise permitted pursuant to any of the other Credit Documents,
sell, assign, transfer, charge, pledge or encumber in any manner any part
of the Pledged Property or agree to do any of the aforesaid or suffer to
exist any Lien over the Pledged Property, other than pursuant to this
Pledge and/or any of the Credit Documents.
7
10.3 The Pledgor shall not procure or authorise or permit the issue of any
further shares in the Borrower unless the Pledgor shall procure that such
further shares are held on the terms hereof as if they were included in
the Pledged Property and, at the cost of the Pledgor, immediately procure
the execution of documentation necessary to pledge such shares in
accordance with the terms herein in form and substance reasonably
satisfactory to the Pledgee including the share certificates and the share
transfer form referred to in Clause 10.1 duly signed by the holders of
such shares and promptly deliver them to the Pledgee.
10.4 If the Pledgor amends the memorandum or articles of association of the
Borrower the Pledgor shall provide the Pledgee with copies of such
amendments.
10.5 Until the Obligations under the Credit Documents have been discharged in
full the Pledgor shall not pass any resolution for the voluntary
winding-up of the Borrower except as permitted by the Credit Agreement.
11. ENFORCEMENT EXPENSES
Subject to Clause 3 hereof, the Pledgor shall pay to the Pledgee within
ten (10) Business Days of demand and supported by the relevant invoices
all expenses incurred or sustained by the Pledgee in connection with,
after a Event of Default, the enforcement or preservation or attempted
enforcement or preservation of its respective rights under this Pledge.
12. SEVERABILITY
If at any time any provision of this Pledge is or becomes illegal, invalid
or unenforceable in any respect under the law of any jurisdiction, neither
the legality, validity or enforceability of the remaining provisions
hereof nor the legality, validity or enforceability of such provision
under the law of any other jurisdiction shall in any way be affected or
impaired thereby.
13. PRESERVATION OF INDEMNITIES
The indemnities contained in this Pledge shall constitute a separate and
independent obligation from the other obligations contained in this
Pledge, shall give rise to a separate and independent cause of action,
shall apply irrespective of any time or indulgence granted by the Pledgee
and/or any Lender Party from time to time and shall continue in full force
and effect notwithstanding the termination or expiry of this Pledge.
14. NOTICES
All notices and other communication provided for hereunder shall be
delivered pursuant to and in accordance with the Credit Agreement.
15. ASSIGNMENT
15.1 This Pledge shall be binding upon and enure to the benefit of each party
hereto and its successors in title and permitted assigns.
15.2 Except as permitted by the Credit Agreement in connection with a transfer
of the Pledgor Property, the Pledgor shall not be entitled to assign or
transfer any of its respective rights, benefits or
8
obligations hereunder without the prior written consent of the Lenders
(which the Lenders shall have full discretion to withhold).
15.3 The Pledgee may assign or transfer its rights, benefits or obligations
under this Pledge in accordance with the Section 9.08 of the Credit
Agreement (but not otherwise).
16. GOVERNING LAW AND JURISDICTION
16.1 THIS PLEDGE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE (OTHER THAN TITLE 14 OF ARTICLE 5
OF THE GENERAL OBLIGATIONS LAW).
16.2 The Pledgor and the Pledgee (a) hereby irrevocably submit itself to the
nonexclusive jurisdiction of the Supreme Court of the State of New York,
New York County and to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York, for the purposes of
any suit, action or other proceeding arising out of this Pledge or any of
the other Credit Documents, the subject matter thereof or any of the
transactions contemplated thereby, (b) hereby irrevocably agrees that all
claims in respect of such suit, action or proceeding may be heard and
determined in such New York State or Federal court and (c) to the extent
permitted by applicable law and to the extent that it has or hereafter may
acquire any immunity from jurisdiction of any court, from any legal
process, or from any remedy provided for in any Credit Document, hereby
waives, and agrees not to assert, by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding (i) that the suit,
action or proceeding is brought in an inconvenient forum, (ii) that the
venue of the suit, action or proceeding is improper, (iii) the defense of
sovereign immunity, (iv) that it is not personally subject to the
jurisdiction of the above-named New York State or Federal court by reason
of sovereign immunity or otherwise, (v) that it is immune from any legal
process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to
itself or its property, or attachment either prior to judgment or in aid
of execution, by reason of sovereign immunity or (vi) that the Credit
Documents, the subject matter thereof or any of the transactions
contemplated thereby may not be enforced in or by such courts or under any
applicable law.
17. COUNTERPARTS
This Pledge may be executed in any number of counterparts and by each of
the parties hereto on separate counterparts each of which when executed
shall constitute an original but all counterparts together shall
constitute but one and the same instrument.
IN WITNESS whereof the Pledgor has executed and delivered this Pledge as a deed
the day and year first above written
9
SCHEDULE 1
AMOUNT OR
NUMBER OF
SHARES DESCRIPTION OF SHARES REGISTERED SHAREHOLDER
10
SCHEDULE 2
SHARE TRANSFER FORM
PRIDE OFFSHORE, INC.
SHARE TRANSFER FORM
FOR VALUE RECEIVED, Pride International, Inc. hereby sells, assigns and
transfers unto ____________________ _________ shares (the "SHARES") of Pride
Offshore, Inc., a Delaware corporation (the "CORPORATION"), standing in our name
on the books of said Corporation represented by Certificate No. _____ herewith,
and does hereby irrevocably constitute and appoint ____________________ as
attorney-in-fact to transfer the said share on the books of said Corporation
with full power of substitution in the premises.
Dated: ____________________
PRIDE INTERNATIONAL, INC.
By: ________________________
Name:
Title:
In the presence of:
____________________________
Name:
Title:
11
EXECUTION PAGE
PLEDGOR
PRIDE INTERNATIONAL, INC.
By:_________________________
Title:
Name:
PLEDGEE
CITIBANK, N.A.
By:_________________________
Name:
Title:
12
EXHIBIT I-2
FORM OF PLEDGE AGREEMENT (BVI)
THIS PLEDGE OF SHARES is made on July 7, 2004
BETWEEN:
(1) PRIDE INTERNATIONAL, INC., a corporation incorporated under the laws of
the State of Delaware ("PLEDGOR"); and
(2) CITIBANK, N.A., a Delaware corporation for and on behalf of itself and the
Lender Parties (the "PLEDGEE") (which expression shall include its
successors, permitted assigns and permitted transferees from time to
time).
RECITALS
(A) Pledgor is the sole legal and beneficial holder of 100% of the issued
shares in the share capital of the _________________________ (the
"COMPANY"), being the entire issued shares in the share capital of the
Company, as further described in Schedule I hereof.
(B) Pursuant to the Credit Agreement dated July 7, 2004 (the "CREDIT
AGREEMENT") between Pride Offshore, Inc. (the "Borrower"), the Lenders
named therein, the Guarantors named therein (including the Pledgor), the
Issuing Banks (as defined therein), Citicorp North America, Inc. as
Administrative Agent and the Pledgee as Collateral Agent, the Lenders have
agreed to make available to the Borrower the facilities referred to
therein on the terms and subject to the conditions contained therein.
(C) It is a condition precedent to the Pledgee and the other Lender Parties
under the Credit Agreement that the Pledgor execute this Pledge pursuant
to which the Pledgor will pledge 65% of the issued shares of the Company
(the "Existing Securities").
IT IS AGREED:
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined shall be used
herein as defined in the Credit Agreement.
2. PLEDGE
2.1 In consideration of the Pledgee and the Lender Parties agreeing to enter
into the Credit Documents and the Hedging Agreements (if any) and as
security for the due and punctual performance of the Obligations, the
Pledgor as sole legal and beneficial owner of: (i) the Existing
Securities, (ii) 65% of any and all other issued shares in the Company
from time to time owned by the Pledgor from the period commencing on the
date hereof and terminating on the date upon which all of the Obligations,
except the Other Obligations, have been paid in full (such period being
the "SECURITY PERIOD"), and (iii) all other shares, stocks, securities,
grants and all rights, monies and property
1
whatsoever, including all dividends or other distributions and interest
paid or payable thereon, which may at any time be derived from, accrue on
or be offered in respect of, the Existing Securities and/or any or all of
the issued shares referred to in (ii) above or comprised in any security
created pursuant hereto, whether by way of redemption, exchange,
conversion, option rights, bonus, preference, capital reorganisation or
otherwise howsoever ((i) - (iii) being the "PLEDGED PROPERTY"), hereby
mortgages, assigns, pledges and hypothecates unto the Pledgee a first
priority security interest, charge and mortgage in all and singular of its
respective rights, title and interests and privileges, whether now owned
or hereafter acquired in, to and over the Pledged Property and each part
thereof.
2.2 Upon payment in full of the Obligations under the Credit Documents, a
Permitted Restructuring or other transaction permitted by the Credit
Agreement that requires the security hereby constituted by this Pledge to
be released as contemplated by the Credit Agreement, the Pledgee shall
upon the request of the Pledgor, discharge the security hereby constituted
by this Pledge and return the items listed in Clause 10.1.1 to the
Pledgor.
3. PLEDGOR'S LIABILITY NOT AFFECTED
3.1 The Pledgor's liability to the Pledgee and each of the Lender Parties
under this Pledge shall not be discharged or impaired by reason of any of
the following events or circumstances (regardless of whether any such
events or circumstances occur with or without the Pledgor's knowledge or
consent):
3.1.1 any time, forbearance or other indulgence given or agreed by the
Pledgee and/or any Lender Party to or with any other person in
respect of any of their respective obligations under any of the
Credit Documents; or
3.1.2 any legal limitation, disability or incapacity relating to any
Credit Party or any other person; or
3.1.3 any invalidity, irregularity, unenforceability, imperfection or
avoidance of or any defect in any security granted by, or the
obligations of any Credit Party or any other person under any of the
Credit Documents or any amendment to or variation thereof or of any
other document or security comprised therein (in accordance with the
terms thereof); or
3.1.4 any change in the name, constitution or otherwise of any Credit
Party or any other person or the merger of any Credit Party or any
other person by or with any other corporate entity; or
3.1.5 the liquidation, bankruptcy or dissolution (or proceedings analogous
thereto) of any Credit Party or any other person or the appointment
of a receiver or administrative receiver or administrator or trustee
or similar officer of any of the assets of any Credit Party or any
other person or the occurrence of any circumstances whatsoever
affecting such Credit Party's or any other person's liability to
discharge its respective obligations under any of the Credit
Documents; or
2
3.1.6 any release, renewal, exchange or realisation of any security or
obligation provided under or by virtue of any of the Credit
Documents (other than as provided in this Pledge) or the provision
to the Pledgee and/or any Lender Party at any time of any further
security for the obligations of any Credit Party or any other person
under any of the Credit Documents; or
3.1.7 any failure on the part of the Pledgee and/or any Lender Party to
take or perfect any security agreed to be taken under or in relation
to any of the Credit Documents; or
3.1.8 any other act, matter or thing which might otherwise constitute a
legal or equitable discharge of any of the Pledgor's obligations
under this Pledge other than the payment in full of the Obligations
under the Credit Documents.
3.2 The Pledgee agrees that, notwithstanding the provisions of Clause 3.1, no
recourse shall be had to any assets of the Pledgor in respect of any of
the Obligations and/or any of the Pledgor's obligations hereunder and,
absent negligence or wilful misconduct on the part of the Pledgor, the
Pledgee hereby acknowledges that it will have no further claim against, or
recourse to, the assets of the Pledgor in respect of such obligations. In
addition, absent negligence or wilful misconduct on the part of the
Pledgor, where compliance with the obligations imposed on the Pledgor
under this charge would require the expenditure by the Pledgor of its own
funds, the obligations of the Pledgor shall be limited to the extent that
it is in funds to meet such expenditure.
3.3 The Pledgee agrees not to seek before any court or governmental agency to
have any shareholder, director or officer of the Pledgor held liable for
any actions or inactions of the Pledgor or any obligations of the Pledgor
under the Credit Documents, except if such actions or inactions are the
result of the fraud or wilful default or recklessness with wilful
disregard or gross negligence of the probable consequences of such
shareholder, director or officer.
3.4 The Pledgee agrees that it shall not take any action to commence any case,
proceeding, proposal or other action under any existing or further law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganisation, arrangement in the nature of insolvency proceedings,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to the Pledgor or the debts of the Pledgor other than
to obtain a declaratory judgment or to seek to enforce and realise its
security under the Pledged Property.
4. CONTINUING PLEDGE
4.1 This Pledge shall be a continuing security and accordingly, except as
provided in this Pledge or in the Credit Agreement:
4.1.1 shall not be discharged by any partial payment or performance by the
Pledgor or any other person under or in respect of any of the Credit
Documents;
4.1.2 shall extend to cover the balance due at any time from any other
Credit Party to the Pledgee and/or any Lender Party under or in
respect of any of the Credit Documents;
3
4.1.3 shall be in addition to and not in substitution for or derogation of
any other security which the Pledgee and/or any Lender Party may at
any time hold in respect of the obligations of any other Credit
Party under or in respect of any of the Credit Documents or the
transactions contemplated thereby; and
4.1.4 except to the extent that the Pledgee expressly waives in writing
the Pledgor's obligations under this Pledge, shall not be discharged
or in any way adversely affected by any action taken or not taken by
the Pledgee and/or any Lender Party.
4.2 Any release or discharge of the security constituted by this Pledge, to
the extent made on the basis of granting of security, or the making of a
disposition or payment, to the Pledgee and/or any Lender Party under the
Credit Documents, shall be conditional upon such security disposition, or
payment not being void, avoided, set aside or ordered to be refunded
pursuant to any enactment or law relating to bankruptcy, liquidation or
insolvency or for any reason whatsoever and, if such condition shall not
be fulfilled, the Pledgee shall be entitled to enforce this Pledge
subsequently as if such release or discharge to the extent made on the
basis of such security, disposition or payment, had not occurred and any
such security, disposition or payment had not been made.
5. EXCLUSION OF THE PLEDGOR'S RIGHTS
5.1 Until the Obligations under the Credit Documents have been discharged in
full, the Pledgor shall not:
5.1.1 following the occurrence of a Event of Default which is continuing
be entitled to share in or succeed to or benefit from (by
subrogation or otherwise) any rights the Pledgee and/or any Lender
Party may have in respect of the Obligations or any related security
or all or any of the proceeds of such rights or security; or
5.1.2 without the prior written consent of the Pledgee:
(a) prove in a liquidation of the Company in competition with the
Pledgee and/or any Lender Party for any monies owing to the
Pledgor by the Company on any account whatsoever; or
(b) following the occurrence of a Event of Default which is
continuing exercise any right of set-off or counterclaim to
which the Pledgor may be entitled against the Company, except
as required by applicable law.
provided that if the Pledgor, in breach of this Clause 5.1, receives
or recovers any monies pursuant to any such exercise, claim or
proof, such monies shall be held by the Pledgor upon trust for the
Pledgee and/or any Lender Party to apply the same as if they were
monies received or recovered by the Pledgee under this Pledge.
6. EXERCISE OF RIGHTS
6.1 Unless and until a Event of Default shall have occurred and be continuing,
the Pledgor shall be entitled to receive and retain all dividends and
other distributions made on or in respect of the
4
Pledged Property and to exercise all voting rights attaching to the
Existing Securities or any thereof for all purposes.
6.2 If a Event of Default shall have occurred and be continuing the Pledgee
shall, without prejudice to any other right or remedy available hereunder
or under applicable law forthwith become entitled:
6.2.1 upon notice to the Pledgor and the Company, solely and exclusively
to all the voting rights attaching to the Pledged Property or any
thereof and the Pledgor shall exercise such rights in such manner as
the Pledgee may in its commercially reasonable discretion determine;
and/or
6.2.2 to receive and, pursuant to Section 6.03 of the Credit Agreement,
apply all dividends and other distributions made on or in respect of
the Pledged Property or any part thereof and any such dividends and
other distributions received by the Pledgor after such time shall be
held in trust by the Pledgor for the Pledgee and be paid or
transferred to the Pledgee on demand; and/or
6.2.3 upon at least ten (10) Business Days' notice to, but without consent
or concurrence by, the Pledgor to sell the Pledged Property or any
part thereof by such method, at such place and upon such terms as
the Pledgee may determine in accordance with applicable law, with
power to postpone any such sale and in any such case the Pledgee may
exercise any and all rights attaching to the Pledged Property as the
Pledgee in its commercially reasonable discretion may determine and
without being answerable for any loss occasioned by such sale or
resulting from postponement thereof or the exercise of such rights;
upon any sale of the Pledged Property or any part thereof the
purchaser thereof shall not be bound to see or enquire whether the
power of sale of the Pledgee has arisen in the manner herein
provided and the sale shall be deemed to be within the power of the
Pledgee and the receipt of the Pledgee for the purchase money shall
effectively discharge the purchaser of the Pledged Property, or any
part thereof, who shall not be concerned or be in any way answerable
therefor.
6.3 Following the occurrence of an Event of Default which is continuing and if
the Pledgee so requests, the Pledgor shall procure that the Company
forthwith enter the relevant details of the Pledgee or its nominee as
shareholder in respect of the Pledged Property in the register of members
of the Company upon presentation of the properly completed executed share
transfer form and satisfaction of any applicable legal requirements.
7. FURTHER ASSURANCE
The Pledgor covenants with the Pledgee that it shall from time to time and
at all times whether before or after the security constituted by this
Pledge shall have become enforceable at the request of the Pledgee, and at
the Pledgor's cost and expense, take such actions and execute such
additional documents as the Pledgee may reasonably require to perfect or
give full effect to this Pledge or for securing the rights hereunder of
the Pledgee and each of the Lenders.
5
8. POWER OF ATTORNEY
8.1 The Pledgor hereby irrevocably and by way of security appoints the Pledgee
to be its attorney (such attorney to have power, upon notice to the
Pledgor, to appoint substitute attorneys and to revoke the appointment
thereof at any time) for and on the Pledgor's behalf and in the Pledgor's
name and as the Pledgor's act and deed:
8.1.1 to execute, seal and deliver and otherwise perfect any such document
as is mentioned in Clause 7 hereof;
8.1.2 to do all such acts and execute, deliver and perfect all such
documents as the Pledgor itself could do or execute with reference
to or in connection with any of the matters dealt with in this
Pledge or any documents contemplated by or entered into pursuant
hereto or thereto or which may be required or deemed proper for any
of the purposes of the security constituted by this Pledge or any
documents contemplated by or entered into pursuant hereto or thereto
and to use the Pledgor's name in the exercise of all or any of the
powers conferred by this Pledge or any documents contemplated by or
entered into pursuant hereto or thereto upon the Pledgee, and to
complete and date (without prejudice to the generality of the
foregoing) the share transfer form referred to in Clause 10.1.1, and
to instruct the Company to enter the relevant details of the Pledgee
or its nominee as shareholder in respect of the Pledged Property in
the register of shares of the Company,
provided always that (i) unless otherwise agreed by the Pledgor, such
power shall not be exercisable by or on behalf of the Pledgee until a
Event of Default has occurred and is continuing, and (ii) no such attorney
shall in the exercise of such power cause the Pledgor to incur
obligations, or liabilities for expenditures, other than those expressly
contemplated by this Pledge.
8.2 The power of attorney hereby granted is as regards the Pledgee and any
substitute attorney (and as the Pledgor hereby acknowledges) granted
irrevocably and for value as part of the security granted by this Pledge
to secure proprietary interests in and the performance of obligations owed
to the Pledgee.
9. REPRESENTATIONS AND WARRANTIES
9.1 The Pledgor represents and warrants at the date hereof that, save as
permitted by the Credit Documents or otherwise by the Pledgee:
9.1.1 it is the sole legal and beneficial owner of all of the shares
comprised in the Existing Securities being 65% of the entire issued
shares in the share capital of the Company;
9.1.2 that the Existing Securities are fully paid up and are not subject
to any options;
9.1.3 none of the Pledged Property is subject to any encumbrance or
security interest whatsoever, howsoever created or arising including
any right of ownership, security, mortgage, pledge, assignment by
way of security, charge, lease, lien, statutory right in rem,
hypothecation, title retention arrangement, attachment, levy, claim,
right of detention or security interest whatsoever, howsoever
created or arising or any right or arrangement
6
having a similar effect to any of the above (the foregoing, a
"LIEN") other than Collateral Permitted Liens or as created pursuant
to this Pledge or the other Security Documents;
9.1.4 it has not taken any action nor, to its knowledge or the knowledge
of its officers, have any steps been taken or legal proceedings been
started for the winding-up, dissolution or re-organisation or for
the appointment of a receiver or administrative receiver, or an
administrator, trustee or similar officer of it or of all or
substantially all of its assets; and
9.1.5 the obligations of the Pledgor under the Credit Documents to which
it is or is to be a party are, or will when the same are executed
be, at least pari passu with all other present and future
obligations of the Pledgor save for obligations mandatorily
preferred by law.
9.2 Each of representations contained herein is made and each of the
warranties contained is given without condition or qualification save as
expressly stated therein.
9.3 The rights and remedies of the Pledgee and/or any Lender Party in relation
to any misrepresentation or breach of warranty on the part of the Pledgor
shall not be prejudiced by the Pledgor, by the performance of this Pledge
or by any other act or thing which may be done by it in connection with
this Pledge and which would apart from this sub-clause prejudice such
rights or remedies.
9.4 The representations and warranties set out in Clause 9.1 shall survive the
execution of this Pledge and shall be deemed to be repeated on the date of
each Advance or issuance of a Letter of Credit, in each case as though
made with reference to the facts and circumstances then subsisting on such
date.
10. UNDERTAKINGS
10.1 The Pledgor undertakes to the Pledgee that it shall, on the date of this
Pledge deliver, or procure that there is delivered, to the Pledgee by way
of security:
10.1.1 (i) the share certificate representing the Existing Securities
comprised in the Pledged Property and (ii) an executed and undated
share transfer form (in the form of Schedule 2) in respect of such
shares in which the identity of the transferee shall be left blank
and which shall be duly executed by the Pledgor; and
10.1.2 certified copies of the register of members of the Company duly
marked to indicate the Lien created pursuant to this Pledge.
10.2 The Pledgor shall file with the Registrar of Companies (British Virgin
Islands) a copy of the register of members duly marked to indicate the
Lien created pursuant to this Pledge.
10.3 The Pledgor shall not, without the prior written consent of the Pledgee or
as otherwise permitted pursuant to any of the other Credit Documents,
sell, assign, transfer, charge, pledge or encumber in any manner any part
of the Pledged Property or agree to do any of the aforesaid or suffer to
exist any Lien over the Pledged Property, other than pursuant to this
Pledge and/or any of the Credit Documents.
7
10.4 The Pledgor shall not procure or authorise or permit the issue of any
further shares in the Company unless the Pledgor shall procure that 65% of
such further shares are held on the terms hereof as if they were included
in the Pledged Property and, at the cost of the Pledgor, immediately
procure the execution of documentation necessary to pledge such shares in
accordance with the terms herein in form and substance reasonably
satisfactory to the Pledgee including the share certificates, and the
share transfer form referred to in Clause 10.1 duly signed by the holders
of such shares and promptly deliver them to the Pledgee.
10.5 If the Pledgor amends the memorandum or articles of association of the
Company, the Pledgor shall provide the Pledgee with copies of such
amendments.
10.6 Until the Obligations under the Credit Documents have been discharged in
full the Pledgor shall not pass any resolution for the voluntary
winding-up of the Company except as permitted by the Credit Agreement.
11. ENFORCEMENT EXPENSES
Subject to Clause 3 hereof, the Pledgor shall pay to the Pledgee within
ten (10) Business Days of demand and supported by the relevant invoices
all expenses incurred or sustained by the Pledgee in connection with,
after a Event of Default, the enforcement or preservation or attempted
enforcement or preservation of its respective rights under this Pledge.
12. SEVERABILITY
If at any time any provision of this Pledge is or becomes illegal, invalid
or unenforceable in any respect under the law of any jurisdiction, neither
the legality, validity or enforceability of the remaining provisions
hereof nor the legality, validity or enforceability of such provision
under the law of any other jurisdiction shall in any way be affected or
impaired thereby.
13. PRESERVATION OF INDEMNITIES
The indemnities contained in this Pledge shall constitute a separate and
independent obligation from the other obligations contained in this
Pledge, shall give rise to a separate and independent cause of action,
shall apply irrespective of any time or indulgence granted by the Pledgee
and/or any Lender Party from time to time and shall continue in full force
and effect notwithstanding the termination or expiry of this Pledge.
14. NOTICES
All notices and other communication provided for hereunder shall be
delivered pursuant to and in accordance with the Credit Agreement.
15. ASSIGNMENT
15.1 This Pledge shall be binding upon and enure to the benefit of each party
hereto and its successors in title and permitted assigns.
15.2 Except as permitted by the Credit Agreement in connection with a transfer
of the Pledged Property, the Pledgor shall not be entitled to assign or
transfer any of its respective rights, benefits
8
or obligations hereunder without the prior written consent of the Lenders
(which the Lenders shall have full discretion to withhold).
15.3 The Pledgee may assign or transfer its rights, benefits or obligations
under this Pledge in accordance with the Section 9.08 of the Credit
Agreement (but not otherwise).
16. GOVERNING LAW AND JURISDICTION
16.1 THIS PLEDGE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICTS OF LAW, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE (OTHER THAN TITLE 14 OF ARTICLE 5
OF THE GENERAL OBLIGATIONS LAW).
16.2 The Pledgor and the Pledgee (a) hereby irrevocably submit itself to the
nonexclusive jurisdiction of the Supreme Court of the State of New York,
New York County and to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York, for the purposes of
any suit, action or other proceeding arising out of this Pledge or any of
the other Credit Documents, the subject matter thereof or any of the
transactions contemplated thereby, (b) hereby irrevocably agrees that all
claims in respect of such suit, action or proceeding may be heard and
determined in such New York State or Federal court and (c) to the extent
permitted by applicable law and to the extent that it has or hereafter may
acquire any immunity from jurisdiction of any court, from any legal
process, or from any remedy provided for in any Credit Document, hereby
waives, and agrees not to assert, by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding (i) that the suit,
action or proceeding is brought in an inconvenient forum, (ii) that the
venue of the suit, action or proceeding is improper, (iii) the defense of
sovereign immunity, (iv) that it is not personally subject to the
jurisdiction of the above-named New York State or Federal court by reason
of sovereign immunity or otherwise, (v) that it is immune from any legal
process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to
itself or its property, or attachment either prior to judgment or in aid
of execution, by reason of sovereign immunity or (vi) that the Credit
Documents, the subject matter thereof or any of the transactions
contemplated thereby may not be enforced in or by such courts or under any
applicable law.
17. COUNTERPARTS
This Pledge may be executed in any number of counterparts and by each of
the parties hereto on separate counterparts each of which when executed
shall constitute an original but all counterparts together shall
constitute but one and the same instrument.
IN WITNESS whereof the Pledgor has executed and delivered this Pledge as a deed
the day and year first above written
9
SCHEDULE 3
AMOUNT OR
NUMBER OF
SHARES DESCRIPTION OF SHARES REGISTERED SHAREHOLDER
10
SCHEDULE 4
SHARE TRANSFER FORM
TWIN OAKS FINANCIAL LTD.
SHARE TRANSFER FORM
FOR VALUE RECEIVED, Pride International, Inc. hereby sells, assigns and
transfers unto ____________________ _________ shares (the "SHARES") of Twin Oaks
Financial Ltd., a British Virgin Islands company (the "COMPANY"), standing in
our name on the books of said Company represented by Certificate No. _____
herewith, and does hereby irrevocably constitute and appoint
____________________ as attorney-in-fact to transfer the said shares on the
books of said Company with full power of substitution in the premises.
Dated: ____________________
PRIDE INTERNATIONAL, INC.
By: ________________________
Name:
Title:
In the presence of:
____________________________
Name:
Title:
11
EXECUTION PAGE
PLEDGOR
PRIDE INTERNATIONAL, INC.
By: ________________________
Title:
Name:
PLEDGEE
CITIBANK, N.A.
By: ________________________
Name:
Title:
12
EXHIBIT I-3
FORM OF PLEDGE AGREEMENT (DUTCH)
1
EG/EvO/JB/db
PLEDGE OF SHARES FORASUB B.V.
On this seventh day of July two thousand and four, appeared before me,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ de Waard-Preller, civil law notary in Rotterdam, the
Netherlands, practising in Rotterdam:
A. Bastiaan Tjeerd ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, residing at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ born at Deventer, the Netherlands on the
tenth day of May nineteen-hundred seventy-one, bearer of a Netherlands
valid passport with number ▇▇▇▇▇▇▇▇▇, acting for the purposes hereof as
attorney - duly authorised in writing - of PRIDE INTERNATIONAL, INC., a
company organised and existing under the laws of the State of Delaware,
United States of America, with its registered office at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America, hereinafter
referred to as the "PLEDGOR"; and
B. Jan ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, residing at 3701 ZS, Zeist, Achterheuvel 89A, the
Netherlands, born at Ridderkerk, the Netherlands on the twenty-sixth day
of January nineteen-hundred and seventy-five, bearer of driving licence
with number ▇▇▇▇▇▇▇▇▇▇, acting for the purposes hereof as attorney - duly
authorised in writing - of CITIBANK, N.A., a national banking association
organized and existing under the laws of the United States of America,
with its registered office at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, 23 rd Floor, New York,
NY 10013, United States of America, hereinafter referred to as the
"PLEDGEE".
The persons appearing, acting in their capacities as mentioned above, declared
as follows:
a. Pride Offshore, Inc. as "BORROWER", the Guarantors named therein as
"GUARANTORS", the Lenders named therein as "REVOLVING LENDERS", the
Lenders named therein as "TERM LENDERS", Citicorp North America, Inc. as
"ADMINISTRATIVE AGENT, Citibank N.A. as COLLATERAL AGENT", the ISSUING
BANKS (as defined therein) and the SWINGLINE LENDERS (as defined therein)
have entered into a Credit Agreement, dated as of the seventh day of July
two thousand and four (as amended, modified, restated and/or supplemented
from time to time, the "CREDIT AGREEMENT");
2
b. it is a condition precedent to the issuance of the initial Letter of
Credit and the obligation of each Lender to make its initial Advance
pursuant to the terms and conditions of the Credit Agreement, that the
Pledgor shall execute this present Deed;
c. the Pledgor is the proprietor (rechthebbende) of all four hundred (400)
issued and outstanding shares in the capital of the Company, each share
having a nominal value of forty-five euros (EUR 45), numbered 1 up to and
including 400, all of which collectively are hereinafter referred to as
the "TOTAL OUTSTANDING SHARES";
d. the shares representing sixty-five percent (65%) of the Total Outstanding
Shares, numbered 1 up to and including 260, are hereinafter referred to as
the "PRESENT SHARES";
e. the Present Shares were acquired by Pride Petroleum Services, Inc. by
virtue of a deed of transfer of shares, executed before ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
civil law notary in Rotterdam, on the eleventh day of March nineteen
hundred ninety-seven,
on the twenty-second day of May nineteen hundred ninety-seven the name of
the acquirer, Pride Petroleum Services, Inc., was changed into Pride
International, Inc. by adopting a resolution thereto,
subsequently, on the thirteenth day of September two thousand and one a
merger, with Pride International, Inc. as disappearing company and PM
Merger, Inc. as acquiring company was filed with the secretary of state of
the State of Delaware, simultaneous with this merger the name of PM
Merger, Inc. was changed into Pride International, Inc,
subsequently the nominal value of the shares was converted into forty-five
euros (EUR 45) each by deed amending the Company's articles of
association, executed before ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, aforementioned, on the
twenty-eighth day of December two thousand and one;
f. it has been agreed that the voting rights attaching to the Pledged Shares
(as defined hereafter) will be vested in (toekomen aan) the Pledgee
subject to the suspensive conditions (opschortende voorwaarden) set out in
Article 7 (Voting rights) of this Deed;
g. the articles of association of the Company permit the creation of a right
of pledge on the Pledged Shares and the conditional transfer of the voting
rights attaching to the Pledged Shares to the Pledgee;
3
h. the shareholder of the Company has resolved to give the legally required
approval for the vesting of the right of pledge by way of the execution of
this Deed, including the conditional transfer of voting rights attaching
to the Pledged Shares to the Pledgee.
DECLARED AS FOLLOWS:
1. DEFINITIONS AND INTERPRETATION
1.1 Unless the context requires otherwise, or unless otherwise defined in this
Deed words and expressions defined in the Credit Agreement shall have the
same meaning when used in this Deed.
1.2 In this Deed, the following words and expressions shall have the following
meanings:
Company: Forasub B.V., a private limited liability company
organized and existing under the laws of the
Netherlands, with its registered office at
Rotterdam, the Netherlands, with address
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ (trade register number 24271164);
Enforcement Event: the occurrence of an Event of Default as defined
in Section 6.1 of the Credit Agreement which is
continuing and also constitutes a default
(verzuim) in the fulfilment of the Secured
Obligations within the meaning of Article 3:248
NCC;
Future Shares: the shares representing sixty-five percent (65%)
of each bundle of registered shares in the capital
of the Company acquired by the Pledgor after
signing of this Deed, having the lowest serial
numbers of each such bundle;
NCC: the Netherlands Civil Code;
Parallel Obligations: has the meaning provided for in paragraph 3.1 of
Article 3 (Parallel Obligations);
Pledged Shares: the Present Shares and the Future Shares
Principal Obligations: the payment when due of any and all obligations of
the Credit Parties to pay an amount of money
4
(verplichtingen tot voldoening van een geldsom)
to the Lender Parties under the Credit Documents
other than under or pursuant to Article 3
(Parallel Obligations);
Secured Obligations: the Parallel Obligations and the Principal
Obligations to the extent owing to the Pledgee;
Security Period: the period beginning on the date of this Deed and
ending on the date on which the Pledgee (acting
reasonably) is satisfied that all the Secured
Obligations (other than the Secured Obligations
described in clause (b) of the definition of
Principal Obligations and the corresponding
Parallel Obligations) have been paid in full and
the Credit Agreement and all Commitments and
Letters of Credit have been cancelled, expire or
otherwise terminate;
Shareholder Rights: any and all of the existing and future rights and
claims respecting the Pledged Shares of the
Pledgor against the Company under the articles of
association of the Company or under applicable law
by virtue of the position of the Pledgor as
shareholder of the Company respecting the Pledged
Shares, to the extent that they are capable of
being pledged and are not pledged by way of the
pledge of the Pledged Shares, other than the
voting rights attaching to the Pledged Shares; and
Shares Related Rights: has the meaning provided for in paragraph 8.1 of
Article 8 (Distributions and Shareholder Rights).
2. CREATION OF PLEDGE
2.1 As security for the Secured Obligations, the Pledgor hereby agrees to
grant and hereby so grants to the Pledgee a disclosed right of pledge (een
openbaar pandrecht) on the Present Shares and grants in advance (bij
voorbaat) a right of pledge on the Future Shares, which right of pledge
the Pledgee hereby accepts.
5
2.2 As security for the Secured Obligations, the Pledgor agrees to grant and
hereby so grants to the Pledgee, to the extent legally possible, a
disclosed right of pledge (een openbaar pandrecht) on its Shareholder
Rights, which right of pledge the Pledgee hereby accepts.
2.3 Immediately after the execution of this Deed and in accordance with
Article 2:196a and 2:196b NCC, the Pledgee shall, under cover of a letter
in substantially the form of Schedule 1 attached to this Deed, instruct a
process server (deurwaarder) to officially serve a notarial copy of this
Deed to the management of the Company.
3. PARALLEL OBLIGATIONS
3.1 The Pledgor hereby irrevocably and unconditionally undertakes to pay to
the Pledgee at any time amounts equal to the amounts payable
(verschuldigd) by it to the Lender Parties or any one of them pursuant to
the Principal Obligations. Each payment undertaking of the Pledgor under
this paragraph 3.1 of this Article 3 (Parallel Obligations) to pay to the
Pledgee an amount which corresponds with an amount payable to the Lender
Parties or any one of them pursuant to the Principal Obligations is
hereinafter referred to as a "Parallel Obligation" and, collectively, the
"Parallel Obligations". Each Parallel Obligation shall become due
(opeisbaar) when the obligation pursuant to the Principal Obligations to
which it corresponds becomes due.
3.2 Any discharge of a Parallel Obligation in full or in part shall, to the
same extent, decrease the obligation pursuant to the Principal Obligations
to which it corresponds.
3.3 Each of the Pledgor and the Pledgee acknowledge and agree (i) that each
Parallel Obligation is separate and independent from, and without
prejudice to, the obligation to which it corresponds, except as provided
in paragraph 3.2 of this Article 3 (Parallel Obligations), and (ii) that
the Pledgee acts in its own name and not as agent or representative of the
Lender Parties or any one of them and that each Parallel Obligation
represents the Pledgee's own separate and independent claim (eigen
zelfstandige vordering) to receive payment of such Parallel Obligation
from the relevant party, as the case may be.
3.4 The Pledgor and the Pledgee acknowledge and agree, for the avoidance of
doubt, that the rules that apply in the event of a common property
(gemeenschap) are not applicable to, and shall not apply by analogy to,
the relation between the Pledgee and the other Lender Parties of the one
part and the Pledgor of the other part.
6
3.5 The Pledgee undertakes to apply any amount received or recovered by it in
payment of a Parallel Obligation as if such amount were received or
recovered by it as agent for the Lender Parties in payment of the amount
due pursuant to the Principal Obligations to which such Parallel
Obligation corresponds.
4. FURTHER ASSURANCES
The Pledgor shall, upon receipt of reasonable written notice from the Pledgee,
execute such further documents and do all such acts and things as the Pledgee
may reasonably require from time to time with respect to or in relation to all
or any of the Pledged Shares and the Shareholders Rights (including upon
acquisition by the Pledgee of any Future Shares) to create, maintain or perfect
the security of the Pledgee over the Pledged Shares and the Shareholders Rights
contemplated by this Deed, but, for the avoidance of doubt, so that the terms of
such further encumbrances shall be no more onerous than the terms of this Deed.
5. REPRESENTATIONS AND WARRANTIES
The Pledgor represents and warrants to the Pledgee that (other than pursuant to
this Deed and except as otherwise permitted by the Credit Documents) on the date
hereof:
(a) the Pledgor is proprietor (rechthebbende) of the Present Shares and the
existing Shareholder Rights and has full legal and beneficial title
thereto and has full power to dispose (beschikkingsbevoegd) of the Present
Shares and the existing Shareholder Rights; and
(b) the Pledged Shares and the Shareholder Rights are not subject to any
pledge or other limited right (beperkt recht) or any agreement to grant a
pledge or other limited right, nor has an attachment (beslag) been levied
on any of the Pledged Shares or Shareholder Rights.
6. COVENANTS AND NEGATIVE UNDERTAKINGS
6.1 Except as otherwise permitted under the Credit Documents, the Pledgor
covenants with the Pledgee that it will not, without the prior written
consent of the Pledgee, which shall not be unreasonably withheld or
delayed:
(a) co-operate with the issue of any depositary receipts in relation to
the Pledged Shares;
(b) create or permit to subsist any liens on or over the Pledged Shares
or the Shareholder Rights or any part thereof or interest therein;
7
(c) sell, transfer, assign or otherwise dispose of the Pledged Shares or
the Shareholder Rights or any part thereof or interest therein or
attempt or agree so to do;
(d) suffer or permit the Company to increase, create or issue any shares
(including by conversion of any obligation now or hereafter
convertible into shares) in the capital of the Company unless sixty
five percent (65%) of such shares are held on the terms hereof as if
they were Pledged Shares;
(e) convene any meeting with a view to passing a resolution for the
Company dissolution (ontbinding), liquidation (vereffening), merger
(including statutory merger (juridische fusie)), or statutory
devision (splitsing), or any equivalent or analogous procedure under
the law of any jurisdiction; or
(f) convene any meeting with a view to passing a resolution for the
Company to enter into a (provisional) suspension of payments
(surseance van betaling) or for bankruptcy (faillissement) or for
the appointment of a receiver or similar officer of it or of all or
substantially all of its assets.
6.2 The Pledgor covenants with the Pledgee that it will defend the Pledgee's
right, title and security interest in and to the Pledged Shares and
Shareholder Rights and the proceeds thereof against the claims and demands
of all persons whomsoever, subject to Collateral Permitted Liens.
7. VOTING RIGHTS
7.1 The Pledgor and the Pledgee hereby stipulate (within the meaning of
Article 2:198, paragraph 3, of the NCC) that the voting rights attaching
to the Pledged Shares are vested in (toekomen aan) the Pledgee subject to
the suspensive conditions (opschortende voorwaarden) that (i) an Event of
Default has occurred and is continuing and (ii) the Pledgee has given
notice to the Pledgor and the Company that it wishes to exercise such
rights. The Pledgee shall exercise such rights in a commercially
reasonable manner.
7.2 The Pledgor agrees that a written notice from the Pledgee to the Company
and the Pledgor in accordance with the provisions of this Deed, certifying
that an Event of Default has occurred and is continuing and that the
Pledgee wishes to exercise the voting rights attaching to the Pledged
Shares, shall be sufficient to accept the Pledgee as being exclusively
entitled to exercise the voting rights attaching to the Pledged Shares.
8
7.3 Upon the occurrence of an Event of Default which is continuing and notice
thereof has been given by the Pledgee to the Pledgor, no vote on the
Pledged Shares shall be cast or any consent, waiver or ratification given
or any action taken or omitted to be taken by the Pledgor, which would
materially violate any of the terms of this Deed or the Credit Documents.
7.4 Until an Event of Default has occurred and is continuing and the Pledgee
has given the notice as referred to in paragraph 7.1 of this Article 7
(Voting rights) that it wishes to exercise the voting rights attaching to
the Pledged Shares, the Pledgee shall not have the rights with respect to
the Pledged Shares that Netherlands law confers to holders of depository
receipts that are issued with the concurrence (medewerking) of a company.
8. DISTRIBUTIONS AND SHAREHOLDER RIGHTS
8.1 The Pledgee shall have the right to receive and collect payment
(inningsbevoegdheid) of dividends and other payments on the Pledged Shares
and to exercise the Shareholders Rights and shall be exclusively
authorised to demand and accept payment of dividends and other payments on
the Pledged Shares and to exercise the Shareholders Rights, to collect
payment thereof by judicial or extra-judicial means, to grant discharge in
respect thereof, to enter into compromises, settlements and other
agreements with the debtors thereof and, generally, to exercise all rights
of the Pledgor in connection with the Pledged Shares and Shareholders
Rights (hereinafter collectively referred to as the "Shares Related
Rights"), provided that the Pledgee hereby grants permission to the
Pledgor to exercise the Shares Related Rights exclusively, which
permission can be withdrawn only if (i) an Event of Default has occurred
and is continuing and (ii) the Pledgee has given notice to the Pledgor and
the Company that such permission has been withdrawn.
8.2 The Pledgor hereby waives its right under Article 3:246, paragraph 4, NCC,
to petition to the Cantonal Judge to authorise it to collect and receive
payment of its dividends and other payments on the Pledged Shares and to
exercise the Shareholders Rights in deviation from this Deed, which waiver
is hereby accepted by the Pledgee.
8.3 The Pledgee shall not, on any account whatsoever, be liable to the Pledgor
for any failure to collect or to collect in full any of the dividends and
other payments on the Pledged Shares or to exercise the Shareholders
Rights, except for its wilful misconduct or gross negligence (opzet of
grove ▇▇▇▇▇▇).
9. IMMEDIATE FORECLOSURE
9
9.1 If an Enforcement Event has occurred and is continuing, the Pledgee shall
be empowered, upon at least ten (10) Business Days' notice to the Pledgor
but without other demand, at its commercially reasonable discretion, to
cause all or a part of the Pledged Shares and the Shareholder Rights to be
sold in accordance with the provisions of the articles of association of
the Company and the laws of the Netherlands.
9.2 Provided the Pledgee gives at least ten (10) Business Days' notice to the
Pledgor prior to an intended sale, the Pledgee shall not be obliged to
give notice of an intended sale as provided for in Article 3:249 NCC, nor
shall the Pledgee be obliged to give the notice following a sale as
provided for in Article 3:252 NCC.
9.3 The Pledgor shall not be entitled to file a request with the interim
provisions judge (voorzieningenrechter) to decide that the Pledged Shares
or the Shareholder Rights are to be sold in a deviating manner as provided
for in Article 3:251 paragraph 1 NCC. Nothing in the preceding sentence
shall limit the right of the Pledgee to file such request.
9.4 The Pledgee is irrevocably authorised (without obligation) by the Pledgor,
in the event of a sale as referred to in paragraph 9.1 of this Article 9
(Immediate foreclosure), to offer the Pledged Shares for sale in the
manner prescribed by the Company's articles of association or to seek the
approval of the corporate bodies designated under the Company's articles
of association as empowered to approve all proposed transfers of shares,
as the case may be, and to exercise the Pledgor's rights in connection
with the sale and transfer of the Pledged Shares as provided in Article
2:198 paragraph 5 NCC. To the extent permitted by applicable law, the
Pledgor as shareholder of the Company, hereby waives any pre-emption
rights or rights of first refusal in relation to the sale of Pledged
Shares referred to in this Article 9 (Immediate foreclosure), which waiver
is hereby accepted by the Pledgee.
9.5 Without prejudice to Article 3:253 NCC, any moneys received by the Pledgee
pursuant to this Deed and/or under the powers hereby conferred, including,
for the avoidance of doubt, any dividend and other payments on the Pledged
Shares pursuant to Article 8 (Distributions and Shareholder Rights), shall
be applied by the Pledgee in accordance with the terms of Section 6.03 of
the Credit Agreement.
9.6 The Pledgor shall render such assistance and provide such information free
of charge as the Pledgee may reasonably deem necessary in connection with
the exercise of their rights, powers or remedies provided for in this
Deed.
10
9.7 The Pledgee shall not be liable to the Pledgor for any damages caused by
the sale of the Pledged Shares or the Shareholder Rights, unless caused by
its gross negligence or wilful misconduct (opzet of grove ▇▇▇▇▇▇).
10. CONTINUING SECURITY AND OTHER MATTERS
10.1 This Deed shall extend to the ultimate balance from time to time of the
Secured Obligations and shall be a continuing security until the end of
the Security Period notwithstanding any intermediate payment, partial
settlement or other matter whatsoever.
10.2 Any release or discharge of the security constituted by this Deed, to the
extent made on the basis of the granting of security, or the making of a
disposition or payment, to the Pledgee and/or any Lender Party under the
Credit Documents, shall be conditional upon such security disposition, or
payment not being void, avoided, set aside or ordered to be refunded
pursuant to any enactment or law relating to bankruptcy, liquidation or
insolvency or for any reason whatsoever and, if such condition shall not
be fulfilled, the Pledgee shall be entitled to enforce this Deed
subsequently as if such release or discharge to the extent made on the
basis of such security, disposition or payment, had not occurred and any
such security, disposition or payment had not been made.
10.3 This Deed and the obligations of the Pledgor under this Deed shall not in
any way be prejudiced or affected by the existence of any other security
documents, encumbrances, rights or remedies or by the same being or
becoming wholly or in part void, voidable or unenforceable on any ground
whatsoever or by the Pledgee dealing with, releasing, varying or failing
to perfect or enforce any of the same, or giving time for payment or
indulgence or compounding with any other person liable.
10.4 The Pledgee shall not be obliged to resort to any other security or other
means of payment now or hereafter held by or available to it before
enforcing this Deed and no action taken or omitted by the Pledgee in
connection with any such other security or other means of payment shall
discharge, reduce, prejudice or affect the right of pledge hereby created.
10.5 Unless the Pledgee purchases the Pledged Shares pursuant to a sale under
Article 9 (Immediate foreclosure) in accordance with Article 3:251
paragraph 1 NCC (or a successor statute or other right to purchase the
Pledged Shares that may be available from time to time), (a) the Pledgor
shall remain liable to perform all obligations, if any, assumed by it with
respect to the Pledged Shares and the Shareholder Rights and the Pledgee
shall not have any obligations or liabilities with respect to the Pledged
11
Shares or any part thereof or the Shareholder Rights by reason of or
arising out of this Deed, nor (b) shall the Pledgee be required or
obligated in any manner to perform or fulfil any of the obligations of the
Pledgor under or with respect to any part of the Pledged Shares (or any
other Total Outstanding Shares) or the Shareholders Rights.
11. SUSPENSION OF THE PLEDGOR'S RIGHTS
In the event that the Pledged Shares or the Shareholder Rights or part thereof
have been sold pursuant to Article 9 (Immediate foreclosure), the Pledgor shall
not, prior to the end of the Security Period:
(a) claim, rank, prove or vote as a creditor of any of the other persons
liable for the Secured Obligations or their estate in competition with the
Pledgee or any of its successors and assigns under the Credit Agreement or
any Secured Hedge Provider; or
(b) receive, claim or have the benefit of any payment, distribution or
security from or on account of any other persons liable for the Secured
Obligations or exercise any right of set-off against any other person
liable for the Secured Obligations, except as required by applicable law.
12. NOTICES
12.1 Any notice or other communication under or in connection with this Deed
shall be in writing and delivered by hand or sent by facsimile, by
courier, or by registered mail and shall be effective (i) upon delivery
when sent by courier service, (ii) upon receipt by the addressee when sent
by post and (iii) when transmission of such facsimile communication has
been completed when sent by facsimile.
12.2 For the purposes hereof, the addresses of the parties shall be as
specified below:
if to the Pledgor:
Pride International, Inc.
Address: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
Attn: Treasurer
12
Copies to: General Counsel and Assistant Treasurer
- Treasury Operations
Fax number: + 1 713 789 1430
with a copy addressed to the registered agent in Delaware of the Pledgor
at the Delaware registered address of the Pledgor;
if to the Pledgee:
Citibank, N.A.
Address: Global Shipping & Logistics, New York
388 Greenwich Street
23rd Floor
New York, NY 10013
United States of America
Attn: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
Fax number: + ▇ (▇▇▇) ▇▇▇-▇▇▇▇
or such other address as the party to be given notice may have notified to
the other parties hereto in accordance with the provision of this Article
12 (Notices).
12.3 The provisions of this Article 12 (Notices) shall not apply in relation to
the service of documents for the purpose of litigation.
13. IRREVOCABLE POWER OF ATTORNEY
13.1 The Pledgor irrevocably appoints the Pledgee, with full power (upon notice
to the Pledgor) of subdelegation, on its behalf and in its name to do any
and everything which it is obliged to do under the terms of this Deed or
which such attorney considers necessary in order to exercise the rights
conferred by or pursuant to this Deed or by law, provided that (a) such
power shall not be exercisable by or on behalf of the Pledgee until an
Event of Default has occurred and is continuing and (b) no such attorney
shall, in the exercise of such power, cause the Pledgor to incur
obligations, or liabilities (including for expenditures), other than those
expressly contemplated by this Deed (including by the enforcement of the
Pledgee's rights hereunder).
13
13.2 In connection with the power of attorney contained in paragraph 13.1 of
this Article 13 (Irrevocable power of attorney), the Pledgor agrees with
the Pledgee, that, even if there is a conflict between its interests and
those of the Pledgee, the Pledgee may act as its counterparty, and,
insofar as necessary, the Pledgor hereby waives any rights it may have at
any time under or pursuant to Article 3:68 NCC, which waiver is hereby
accepted by the Pledgee.
14. ASSIGNMENT
14.1 The Pledgee shall be entitled to assign and/or transfer all or part of its
rights and obligations under this Deed to any assignee and/or transferee
in accordance with Section 9.08 of the Credit Agreement (but not
otherwise).
14.2 The Pledgor shall be entitled to assign and/or transfer all or part of its
rights and obligations under this Deed to any assignee and/or transferee
to the extent permitted by the Credit Agreement (but not otherwise).
14.3 The Pledgor hereby in advance gives its irrevocable consent to (geeft
onherroepelijk toestemming bij voorbaat) within the meaning of section
6:156 of the NCC and hereby in advance irrevocably co-operates with
(verleent bij voorbaat onherroepelijk medewerking aan), within the meaning
of section 6:159 of the NCC, any such assignment and/or transfer referred
to in paragraph 14.1 of this Article 14 (Assignment), including by means
of an assumption of debt (schuldoverneming), or transfer of agreement
(contractsover-neming), as applicable.
14.4 The Pledgee shall be entitled to impart any information concerning the
Pledgor, the Pledged Shares and the Shareholder's Rights to any successor
or proposed successor according to paragraph 14.1 of this Article 14
(Assignment), subject to the confidentiality provision of the Credit
Agreement.
15. NO NULLIFICATION/DISSOLUTION
The Pledgor hereby, to the extent legally possible, waives its right to nullify
or have nullified or dissolve or have dissolved the legal acts represented by
this Deed pursuant to the Articles 6:228 and/or 6:265 NCC or on any other
ground, which waiver is hereby accepted by the Pledgee.
16. AMENDMENT AND WAIVER
14
None of the terms and conditions of this Deed may be changed, waived, modified
or varied in any manner whatsoever unless otherwise agreed in writing between
the parties.
17. PARTIAL INVALIDITY
In the event that a provision of this Deed is invalid, illegal, not binding, or
unenforceable (either in whole or in part), the remainder of this Deed shall
continue to be effective to the extent that, in view of the Deed's substance and
purpose, such remainder is not inextricably related to and therefore in
severable from the invalid, illegal, not binding or unenforceable provision. The
parties to this Deed shall make every effort to reach agreement on a new clause
which differs as little as possible from the invalid, illegal, not binding or
unenforceable provision, taking into account the substance and purpose of this
Deed.
18. TERMINATION
18.1 The security shall be released, at the request and expense of the Pledgor,
upon (A) the expiry of the Security Period and/or (B) at any time prior to
the expiry of the Security Period, upon the sale of Pledged Shares and/or
Shareholders Rights, a Permitted Restructuring or other transaction
permitted by the Credit Agreement that requires the security to be
released as contemplated by the Credit Agreement.
18.2 It is expressly agreed that the Pledgee, will be entitled at any time to
terminate, in whole or in part by notice (opzegging) its rights of pledge
created by this Deed and the contractual arrangements set forth herein.
19. GOVERNING LAW
This Deed and any dispute, controversy, proceedings or claim of whatever nature
arising out of or in any way relating to this Deed and the rights of pledge
created hereby shall be governed by and construed in accordance with the laws of
the Netherlands.
20. JURISDICTION
20.1 Any disputes arising out of or in connection with this Deed or the rights
of pledge created hereby shall be submitted in first instance to the
competent court at Rotterdam, the Netherlands.
20.2 Nothing in paragraph 21.1 of this Article 21 (Jurisdiction) shall limit
the Pledgee's right to bring proceedings against the Pledgor in any other
court or competent jurisdiction.
15
21. CIVIL LAW NOTARY
The Pledgor is aware of the fact that the undersigned civil law notary works
with NautaDutilh N.V., the firm that has advised the Pledgee in this
transaction. With reference to the Code of Conduct ("Verordening beroeps- en
gedragsregels") of the Royal Notarial Professional organisation ("Koninklijke
Notariele Beroepsorganisatie KNB"), the parties to this Deed herewith explicitly
agree that he executes this Deed.
22. AUTHORITY AND POWERS OF ATTORNEY
22.1 The person appearing as mentioned under A has been granted one (1) power
of attorney by means of one (1) non-notarial instruments of attorney. The
person appearing as mentioned under B has been granted one (1) power of
attorney by means of one (1) non-notarial instrument of attorney. The
instruments of attorney will immediately after this Deed has been executed
be attached to this Deed.
22.2 If a party to this Deed is represented by an attorney in connection with
the signing and/or execution of this Deed or any other deed, agreement or
document referred to herein or made pursuant hereto and the relevant power
of attorney is governed by the laws of the Netherlands, it is hereby
expressly acknowledged and accepted by the other parties hereto that such
laws shall govern the existence and the extent of such attorney's
authority and the effects of the exercise thereof.
FINAL PART
The persons appearing before me are known to me, civil-law notary.
This Deed was executed in Rotterdam on the date mentioned in its heading.
After I, civil-law notary, had conveyed and explained the contents of the Deed
in substance to the persons appearing, they declared that they had taken note of
the contents of the Deed, agreed with the contents and did not wish it to be
read out in full.
Following a partial reading, the Deed was signed by the persons appearing and
me, civil-law notary at
16
SCHEDULE 1
LETTER TO PROCESS SERVER
BY REGISTERED MAIL
To: [name of firm Process Server]
[Place, Date]
Dear Sirs,
re: Serving of a notarial copy of a notarial deed of pledge of shares
Further to our telephone conversation earlier today, please find herewith a
notarial copy of the notarial deed of pledge of shares in the capital of Forasub
B.V., which
deed was executed on [ ] before Mr. M.F.E. de Waard-Preller, civil law notary.
Since the company referred to above is not a party to the deed, I kindly request
you to, in accordance with Article 2:196a and 2:196b of the Netherlands Civil
Code, serve the notarial copy of the deed of pledge to the management of Forasub
B.V., having its registered office at Rotterdam, the Netherlands with address:
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇.
I look forward to receiving your written confirmation of serving the deed of
pledge to the company referred to above.
Yours sincerely,
[ ]
NautaDutilh N.V.
2
AANGETEKEND
Aan: [naam Deurwaarderskantoor]
[Plaats, Datum]
betreft: Betekening van een notarieel afschrift van een notariele akte van
verpanding van aandelen
Geachte heer,
Met referte aan ons telefonisch onderhoud ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ u hierbij aan een
1
notarieel afschrift van een notariele akte van verpanding van aandelen in het
kapitaal van Forasub B.V., ▇▇▇▇▇ akte op [ ] is verleden voor Mr. M.F.E. de
Waard-Preller, notaris.
Aangezien de hierboven genoemde vennootschap geen partij is bij de betreffende
akte, verzoek ik u hierbij vriendelijk, ingevolge het bepaalde in de artikelen
196a en 196b van Boek 2 van het Burgerlijk Wetboek, het afschrift van de
pandakte rechtsgeldig te betekenen aan Forasub B.V. statutair gevestigd te
Rotterdam, Nederland en kantoor houdende aan het ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
Graag ontvang ik van u een bevestiging van de betekening aan voormelde
vennootschap.
Met vriendelijke groet,
[ ]
NautaDutilh N.V.
EXHIBIT K
INITIAL RIGS
PART I
OPERATING
RIG REGISTERED OWNER FLAG LOCATION STATUS
--- ---------------- ---- -------- ------
Pride Alabama Pride Drilling LLC Vanuatu GOM (Mexico) operating
Pride Alaska Pride Central America Vanuatu GOM (Mexico) operating
LLC
Pride Arkansas Pride Drilling LLC Vanuatu GOM (Mexico) operating
Pride Arizona Pride Offshore, Inc. US GOM operating
Pride California Pride Central America LLC Panama GOM (Mexico) operating
Pride Colorado Pride Drilling LLC Vanuatu GOM (Mexico) operating
Pride Florida Pride Offshore, Inc. US GOM operating
Pride Georgia Pride Offshore, Inc. US GOM operating
Pride Hawaii Pride Offshore International LLC Vanuatu SE Asia operating
Pride Kansas Pride Offshore, Inc. Panama GOM operating
Pride Louisiana Mexico Drilling Limited LLC Panama GOM (Mexico) operating
Pride Michigan Pride Offshore, Inc. US GOM operating
Pride Mississippi Pride Central America LLC Vanuatu GOM (Mexico) operating
Pride Missouri Pride Offshore, Inc. US GOM operating
Pride Nebraska Pride Central America LLC Vanuatu GOM (Mexico) operating
Pride Nevada Mexico Drilling Limited LLC Vanuatu GOM (Mexico) operating
Pride New Mexico Pride Offshore, Inc. US GOM operating
Pride North America Pride North America LLC Vanuatu W. Africa operating
Pride North Dakota Pride Offshore International LLC Vanuatu Nigeria operating
Pride Oklahoma Pride Central America LLC Panama GOM (Mexico) operating
Pride Rotterdam Pride Offshore International LLC Vanuatu N. Sea operating
Pride South Carolina Mexico Drilling Limited LLC Vanuatu GOM (Mexico) operating
Pride South Pacific Pride South Pacific LLC Panama W. Africa operating
Pride Tennessee Pride Drilling LLC Vanuatu GOM (Mexico) operating
Pride Texas Pride Drilling LLC Panama GOM (Mexico) operating
Pride Utah Pride Offshore, Inc. Panama GOM stacked
Pride Wisconsin Pride Central America LLC Panama GOM (Mexico) operating
Pride Wyoming Pride Offshore, Inc. Panama GOM stacked
PART II
RIG
▇▇▇▇ ▇
▇▇▇▇ ▇
1005 E
1006 E
14
200
210
220
▇▇▇ ▇
▇▇▇ ▇
▇▇▇ ▇
▇▇▇ ▇
▇▇▇ ▇
EXHIBIT M
OPCO LOAN COLLATERAL
▇▇ ▇▇▇▇▇▇
Alligator
Barracuda
Piranha
Pride Venezuela
EXHIBIT N
EXISTING LIENS
AMOUNT /
LIEN ENTITY CAPACITY DATE DESCRIPTION
CREDIT FACILITIES
Credit Lyonnais as Administrative Pride Offshore $ 250,000,000 6/20/2002 Secured revolving credit facility,
Agent $125,000,000 outstanding at March
2004
Credit Lyonnais as Administrative Pride Offshore $ 196,500,000 12/29/2003 Secured term loan facility
Agent
Natexis Banques Populaires as Lead Pride Foramer SAS and $ 180,000,000 10/24/2003 Secured revolving credit facility,
Arranger Forasub BV $129,000,000 outstanding at March
2004
* ITM for sibnieft $ 457,981 10/1/2001 $ 2 595 228 are Non recourse against
ITM
* Somaser for sibnieft $ 1,401,754 10/1/2001 $ 7 943 275 are Non recourse against
SOMASER
PROJECT FINANCE LOANS
Arranger Petrodrill 6 $ 79,336,578 8/1/2001 Petrodrill 6 - Pride Brazil
contruction debt
Arranger Petrodrill 7 $ 79,336,578 8/1/2001 Petrodrill 7 - Pride ▇▇▇▇▇▇ ▇▇▇▇▇▇
construction debt
Arranger Andre Maritime Ltd. / $ 301,350,775 4/27/2004 Pride Angola / Africa drillship
▇▇▇▇▇▇ Maritime Ltd. non-recourse note payable
N.V. Marubeni Benelux S.A. and Peforaciones Western $ 950,000 8/29/1994 Limited recourse term collateralized
Nittetsu Shoji Co. Ltd. C.A. term loan on Pride I
N.V. Marubeni Benelux S.A. and Peforaciones Western $ 950,000 8/29/1994 Limited recourse term collateralized
Nittetsu Shoji Co. Ltd. C.A. term loan on Pride II
General Foods Credit Investors Pride Amethyst Ltd. $ 76,163,000 2/26/1999 FIN 46R consolidated lease - GE
No. 3 Capital
Compagnie Financiere de CIC et De Sonamer SAS $ 14,781,487 12/3/2001 Pride Cabinda jackup - non recourse
L'Union Europeenne, as Arranger in excess of 10 M$
CAPITAL LEASES
Foramer Foramer $ - 5/2/1997 Bail Materiel ▇▇▇▇▇▇▇ set 27
Forasol Forasol $ 313,342 - Baticentre district office leasing
Somaser Somaser $ 142,373 - Baticentre district office leasing
LaSalle National Leasing Pride International, $ 3,793,000 5/1/1998 Capital lease on platform rig 1501E
Corporation Inc.
First Security Bank, N.A. Pride International, $ 4,119,000 4/1/1998 Capital lease on platform rig 1502E
Inc.
BTM Capital Corporation Pride International, $ 3,373,000 12/1/1997 Capital lease on platform rig 1004E
--------------
TOTAL $1,192,968,868
--------------
EXHIBIT O
EXISTING DEBT
AMOUNT / 6/29/2004 6/30/2004
DEBT BORROWING ENTITY CAPACITY OUTSTANDING OUTSTANDING DATE DESCRIPTION
CREDIT FACILITIES
Credit Lyonnais as Pride Offshore $250,000,000 $100,000,000 6/20/2002 Secured revolving
Administrative Agent credit facility,
$125,000,000
outstanding at March
2004
Credit Lyonnais as Pride Offshore $196,500,000 $196,500,000 12/29/2003 Secured term loan
Administrative Agent facility
Natexis Banques Pride Foramer SAS $180,000,000 $129,000,000 $129,000,000 10/24/2003 Secured revolving
Populaires as Lead and Forasub BV credit facility,
Arranger $129,000,000
outstanding at March
2004
B.P. Val France - FM Pride Forasol $ 3,341,000 $ - 1/3/1997 Short term revolving
Entities credit facility
B.P. Val France - FM Pride Forasol $ 1,500,000 $ - 1/6/2000 Short term revolving
Entities credit facility
Banco Rio de la Plata Pride International $ 2,367,000 $ - - Short term revolving
S.A. S.R.L. credit facility
Banex Pride International $ 3,384,000 $ - - Short term revolving
S.R.L. credit facility
Banco ▇▇▇▇▇▇▇ ▇▇▇▇▇ International $ 1,015,000 $ - - Short term revolving
S.R.L. credit facility
Bank Boston Pride International $ 1,015,000 $ - - Short term revolving
S.R.L. credit facility
Lloyds Bank Pride International $ 1,015,000 $ - - Short term revolving
S.R.L. credit facility
BNP Pride Forasol $ 12,000,000 $ 12,000,000 $ 12,000,000 6/30/2001 Short term revolving
Entities credit facility
CA Ile de France Pride Forasol $ 5,000,000 $ - 2/15/2001 Short term revolving
Entities credit facility
Calyon Pride Forasol $ 5,000,000 $ - 9/8/2000 Short term revolving
Entities credit facility
C.I.C Pride Forasol $ 6,000,000 $ - 8/20/1998 Short term revolving
Entities credit facility
Credit Lyonnais Pride Forasol $ 10,000,000 $ 6,340,000 $ 3,684,000 11/9/1998 Short term revolving
Entities credit facility
NATEXIS Pride Forasol $ 7,500,000 $ 7,500,000 $ 7,500,000 4/10/2000 Short term revolving
Entities credit facility
Export Credit financing ITM for sibnieft $ 457,981 $ 1,316,172 $ 457,981 10/1/2001 $ 2 595 228 are Non
Coface /NATEXIS & recourse against ITM
COMMERZBANK *
Export Credit financing Somaser for sibnieft $ 1,401,754 $ 2,221,251 $ 1,401,754 10/1/2001 $ 7 943 275 are Non
Coface /NATEXIS & recourse against
COMMERZBANK * SOMASER
SENIOR NOTES
Senior Notes 9.375% due Pride $175,000,000 $175,000,000 5/2/1997 Senior Notes 9.375%
2007 International, Inc. due 2007
Senior Notes 10% due Pride $200,000,000 $200,000,000 5/21/1999 Senior Notes 10% due
2009 International, Inc. 2009
CONVERTIBLE DEBT
Convertible Senior Notes Pride $300,000,000 $300,000,000 2/26/2002 Convertible Senior
2.5% due 2007 International, Inc. Notes 2.5% due 2007
Convertible Senior Notes Pride $300,000,000 $300,000,000 4/22/2003 Convertible Senior
3.25% due 2033 International, Inc. Notes 3.25% due 2033
Drillpetro Inc. Pride $ 74,324,586 $ 74,324,586 3/1/2001 Convertible senior
International, Inc. notes for purchase
of Pride ▇▇▇▇▇▇
▇▇▇▇▇▇ and Pride
Brazil interests
Subordinated Zero Coupon Pride $ 1,095,000 $ 1,095,000 4/20/1998 Subordinated Zero
Convertible Debentures International, Inc. Coupon Convertible
2.5% due 2021 Debentures 2.5% due
2021
PROJECT FINANCE LOANS
Compagnie Financiere de Petrodrill 6 $ 79,336,578 $ 79,336,578 $ 79,336,578 8/1/2001 Petrodrill 6 - Pride
CIC et De L'Union Brazil contruction
Europeenne, as Arranger debt
Compagnie Financiere de Petrodrill 7 $ 79,336,578 $ 79,336,578 $ 79,336,578 8/1/2001 Petrodrill 7 - Pride
CIC et De L'Union ▇▇▇▇▇▇ ▇▇▇▇▇▇
Europeenne, as Arranger construction debt
Compagnie Financiere de Andre Maritime Ltd. $301,350,775 $278,535,000 $278,885,376 4/27/2004 Pride Angola /
CIC et De L'Union / ▇▇▇▇▇▇ Maritime Africa drillship
Europeenne, as Arranger Ltd. non-recourse note
payable
N.V. Marubeni Benelux Peforaciones Western $ 950,000 $ 950,000 8/29/1994 Limited recourse
S.A. and Nittetsu Shoji C.A. term collateralized
Co. Ltd. term loan on Pride I
N.V. Marubeni Benelux Peforaciones Western $ 950,000 $ 950,000 8/29/1994 Limited recourse
S.A. and Nittetsu Shoji C.A. term collateralized
Co. Ltd. term loan on Pride II
General Foods Credit Pride Amethyst Ltd. $ 76,163,000 $ 76,163,000 2/26/1999 FIN 46R consolidated
Investors No. 3 lease - GE Capital
Compagnie Financiere de Sonamer SAS $ 14,781,487 $ - 12/3/2001 Pride Cabinda jackup
CIC et De L'Union - non recourse in
Europeenne, as Arranger excess of 10 M$
CAPITAL LEASES
Foramer Foramer $ - $ - 5/2/1997 Bail Materiel
▇▇▇▇▇▇▇ set 27
Forasol Forasol $ 313,342 $ 359,300 $ 313,342 - Baticentre district
office leasing
outstanding in Euro
Rate to be adjusted
Somaser Somaser $ 142,373 $ 163,254 $ 142,373 - Baticentre district
office leasing
outstanding in Euro
Rate to be adjusted
LaSalle National Leasing Pride $ 3,793,000 $ 3,793,000 5/1/1998 Capital lease on
Corporation International, Inc. platform rig 1501E
First Security Bank, Pride $ 4,119,000 $ 4,119,000 4/1/1998 Capital lease on
N.A. International, Inc. platform rig 1502E
BTM Capital Corporation Pride $ 3,373,000 $ 3,373,000 12/1/1997 Capital lease on
International, Inc. platform rig 1004E
Note:
For Sibneft / SOMASER: Total amount due to Natexis is $ 9 345 029 Coface
guarantee for 85 %
For Sibneft / ITM: Total amount due to Natexis is $ 3 053 209 Coface guarantee
for 85 %
FOR SONAMER: PRIDE CABINDA :
FOR FORASUB: NATEXIS : amount = 129 000 000 (trA1=79 000 ; trA2= 40 000 ; trc =
10 000)
EXHIBIT P-1
FORM OF VESSEL MORTGAGES
FIRST PREFERRED FLEET MORTGAGE (this "Mortgage") made this 7th day
of July, 2004, by PRIDE OFFSHORE, INC., a Delaware corporation (the "Shipowner")
with an address at: c/o Pride International, Inc., ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇, to CITIBANK, N.A., with an address at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, not in its individual capacity, but solely as Trustee
(together with its successors in trust and assigns, the "Mortgagee"), pursuant
to that certain Master Vessel and Trust Agreement dated as of the date hereof
(as the same may be amended, supplemented or otherwise modified from time to
time, the "Master Vessel and Trust Agreement") between CITIBANK, N.A., as
Collateral Agent under the Credit Agreement (as defined below) and CITIBANK,
N.A., as Trustee, a copy of a form of which, including exhibits thereto, is
annexed hereto as Exhibit A, and made a part hereof. Capitalized terms used
herein and not otherwise defined are used herein as defined in the Credit
Agreement (as defined below), a copy of a form of which, including certain
exhibits, is annexed hereto as Exhibit B and made a part hereof.
WHEREAS:
1. Pursuant to the Master Vessel Trust Agreement, the Mortgagee has
agreed to act as Trustee and hold this Mortgage;
2. The Shipowner is a party to the Credit Agreement dated as of July
7, 2004 (as the same may be amended, supplemented or otherwise modified from
time to time, the "Credit Agreement") among the Shipowner, as borrower (the
"Borrower"), Mortgagee, Citicorp North America, Inc., as Administrative Agent,
Citibank, N.A., as Collateral Agent, the Lenders (as defined therein), the
Guarantors named therein, and the Issuing Banks (as defined therein) pursuant to
which the Lenders have agreed from time to time to extend (x) credit and/or
issue letters of credit for the benefit of the Borrower in an aggregate amount
up to Five Hundred Million United States Dollars (US$500,000,000.00) and (y) a
term loan facility in an aggregate principal amount of Three Hundred Million
United States Dollars (US$300,000,000.00), aggregating a principal amount of
Eight Hundred Million United States Dollars (US$800,000,000), which amount is
the principal amount of this Mortgage.
3. The Shipowner is the sole owner of the whole of the United States
flag vessels and rigs (collectively, the "Vessels"), each duly documented in the
name of the Shipowner under the laws and flag of the United States of America,
each qualified to engage in the trade specified, which Vessels are further
described on Schedule I attached hereto and made a part hereof; and
4. The Shipowner may enter, after the date hereof, into one or more
Hedging Agreements with one or more Secured Hedged Providers.
5. The Shipowner, in order to secure its obligations as Borrower
under the Credit Agreement and the other Credit Documents, and the payment of
all other sums of money (whether for principal, premium, if any, interest, fees,
expenses, indemnities or otherwise) from
time to time payable by the Shipowner under this Mortgage and the other Credit
Documents to which it is a party and any Hedging Agreement(s) that it may enter
into, and to secure the performance and observance of all agreements, covenants
and provisions contained in this Mortgage, the other Credit Documents
(collectively, the "Obligations"), has duly authorized the execution and
delivery of this Mortgage.
NOW, THEREFORE, to secure the prompt payment of the Obligations and
the performance and observance of all agreements, covenants and provisions of
the Shipowner contained in the Credit Agreement, this Mortgage and the other
Credit Documents, the Shipowner has granted, conveyed, mortgaged, pledged,
confirmed, assigned, transferred and set over, and by these presents does grant,
convey, mortgage, pledge, confirm, assign, transfer and set over unto the
Mortgagee the whole of each Vessel, together with all of the boilers, engines,
generators, drilling machinery and equipment, pumps and pumping equipment,
machinery, masts, spars, sails, boats, anchors, cables, chains, rigging, tackle,
outfit, apparel, furniture, fittings, equipment, spares, fuel, stores and all
other appurtenances thereunto appertaining or belonging, and also any and all
additions, improvements and replacements hereafter made in or to each such
Vessel, or any part thereof, or in or to her equipment and appurtenances
aforesaid;
TO HAVE AND TO HOLD all and singular the above mortgaged and
described property unto the Mortgagee and its successors and assigns, to its and
its successors' and assigns' own use, benefit and behoof forever;
PROVIDED, HOWEVER, and these presents are upon the condition that,
if the Shipowner or its successors or assigns shall pay or cause to be paid or
there shall otherwise be paid in full, the Obligations in accordance with the
terms hereof and of the Credit Agreement and the other Credit Documents, and
shall perform and observe or cause to be performed and observed all of the
agreements, covenants and provisions contained in this Mortgage, the Credit
Agreement and the other Credit Documents, and the Credit Agreement and all
Commitments and Letters of Credit shall terminate or expire, this Mortgage and
the estate and rights hereby granted shall cease to be binding and be void,
otherwise to remain in full force and effect.
IT IS HEREBY COVENANTED, DECLARED AND AGREED that the property above
described is to be held subject to the further covenants, conditions,
provisions, terms and uses hereinafter set forth.
ARTICLE I
COVENANTS OF THE SHIPOWNER
The Shipowner covenants and agrees with the Mortgagee as follows:
SECTION 1.1. The Shipowner will make payment when due of all
Obligations from time to time payable by the Shipowner under the Credit
Agreement and the other Credit Documents and will observe, perform and comply
with the covenants, terms and conditions herein and in the Credit Agreement and
the other Credit Documents, on its part to be observed, performed or complied
with.
2
SECTION 1.2. The Shipowner is and shall remain duly qualified to
own, document and operate the Vessels under the applicable laws and regulations
of the United States endorsed for the respective trade in which they are engaged
from time to time. The Vessels are duly documented in the name of the Shipowner
as owner under the laws of the United States.
SECTION 1.3. The Shipowner lawfully owns and is lawfully possessed
of each Vessel free from any lien, charge or encumbrance whatsoever (except for
this Mortgage and the Collateral Permitted Liens), and will warrant and defend
the title and possession thereto and to every part thereof for the benefit of
the Mortgagee against the claims and demands of all persons whomsoever.
SECTION 1.4. The Shipowner has caused this Mortgage to be duly filed
and will cause it to be duly recorded and will comply with and satisfy all of
the provisions and requirements of Chapter 313 of Title 46 of the United States
Code and the regulations in effect thereunder from time to time, as amended, in
order to establish, perfect and maintain this Mortgage as a valid, enforceable
and duly perfected first preferred mortgage lien thereunder upon the Vessels and
upon all renewals, replacements and improvements made in or to the same for the
amount of the Obligations.
SECTION 1.5. The Shipowner will not (i) cause or permit the Vessels
to be operated in any manner contrary to law, (ii) engage in any unlawful trade
or violate any law, (iii) carry any cargo that will expose any Vessel to
penalty, confiscation, forfeiture, capture or condemnation, or (iv) do, or
suffer or permit to be done, anything which can or may injuriously affect the
registration or enrollment of any of the Vessels under the laws and regulations
of the United States, if such actions described in this sentence could
reasonably be expected to result in a Material Adverse Effect (as defined in the
Credit Agreement). The Shipowner will at all times keep each Vessel duly
documented as an United States flag vessel under Chapter 121 of Title 46 of the
United States Code, eligible for the trade of the United States in which it is
engaged from time to time.
SECTION 1.6. [Intentionally Omitted]
SECTION 1.7. Neither the Shipowner, any charterer, the Master of any
Vessel nor any other person has or shall have any right, power or authority to
create, incur or permit (if such action could reasonably be expected to result
in a Material Adverse Effect) to be placed or imposed or continued upon the
Vessels any lien whatsoever other than this Mortgage and Collateral Permitted
Liens.
SECTION 1.8. The Shipowner will place, and at all times and places
will retain, a properly certified copy of this Mortgage on board each Vessel
with her papers and will cause such certified copy and such Vessel's marine
document to be exhibited to any and all persons having business therewith which
might give rise to any lien thereon other than Collateral Permitted Liens, and
to any representative of the Mortgagee; and the Shipowner will place and keep
prominently displayed in the chart room and in the Master's cabin of each
Vessel, or in the case of a rig, in a prominent place aboard the rig, or in such
location as the rig's papers are kept, a framed printed notice in plain type
reading as follows:
3
"NOTICE OF MORTGAGE
This Vessel is covered by a First Preferred Fleet Mortgage to Citibank,
N.A., as Trustee. Under the terms of said Mortgage, neither the Shipowner,
any charterer, the Master of this Vessel nor any other person has any
right, power or authority to create, incur or permit to be imposed upon
this Vessel any lien whatsoever other than Collateral Permitted Liens (as
defined in the Credit Agreement attached to the First Preferred Ship
Mortgage)."
SECTION 1.9. Except for this Mortgage and Collateral Permitted
Liens, the Shipowner will not suffer to be continued any lien referenced in
Section 5.02 of the Credit Agreement, encumbrance or charge on any Vessel for
longer than 30 days, and in due course and in any event within 60 days after the
same becomes due and payable, the Shipowner will pay or cause to be discharged
or make adequate provision for the satisfaction or discharge of all claims or
demands (except to the extent that the same shall concurrently be contested by
the Shipowner in good faith by appropriate proceedings that shall not affect the
continued release of the relevant Vessel), or will cause the relevant Vessel to
be released or discharged from any lien, encumbrance or charge therefor.
SECTION 1.10. (a) If a libel or complaint be filed against any
Vessel or any Vessel be otherwise attached, arrested, levied upon or taken into
custody under process or color of legal authority for any cause whatsoever, the
Shipowner will promptly notify the Mortgagee by facsimile, confirmed by letter,
at its address, as specified in this Mortgage, and within 30 days will cause
such Vessel to be released and all liens thereon other than this Mortgage and
Collateral Permitted Liens to be discharged (except to the extent that the claim
giving rise to such lien shall concurrently be contested by the Shipowner in
good faith by appropriate proceedings that shall not affect the release of such
Vessel) and will promptly notify the Mortgagee thereof in the manner aforesaid.
(b) If the Shipowner shall fail or neglect to furnish proper
security or otherwise to release such Vessel from libel, arrest, levy, seizure
or attachment within the time period required by Section 1.10(a) above, the
Mortgagee or any person acting on behalf of the Mortgagee may furnish security
to release such Vessel and by so doing shall not be deemed to cure the default
of the Shipowner.
SECTION 1.11. (a) Except while such Vessel is undergoing repairs,
maintenance or is in lay up, the Shipowner will at all times and without cost or
expense to the Mortgagee maintain and preserve, or cause to be maintained and
preserved, each Vessel (i) in good running order and repair, so that each Vessel
shall be, insofar as due diligence can make her so, tight, staunch, strong and
well and sufficiently tackled, apparelled, furnished, equipped and in every
respect seaworthy and (ii) in at least as good condition as when originally
delivered by her builder, ordinary wear and tear excepted; and will keep each
Vessel, or cause her to be kept, in such condition as will entitle her to such
classification rating with the American Bureau of Shipping or other
classification society of like standing reasonably acceptable to the Mortgagee
that companies engaged in the operation of vessels of the same type, size, age
and flag as the Vessels maintain respecting their vessels with such
classification society. Notwithstanding the foregoing, if a Vessel is affected
by a Casualty Event, the Shipowner shall
4
either make all necessary repairs and replacements to such respective Vessel or
apply the Casualty Proceeds as provided in the Credit Agreement.
(b) Each Vessel shall, and the Shipowner covenants that it will, at
all times comply with all applicable laws, rules and regulations to the extent
set forth in the Credit Agreement, and each Vessel shall have on board as and
when required thereby certificates showing compliance therewith.
(c) The Shipowner will not make, or permit to be made, any
substantial change in the structure, type or speed of any Vessel or change in
the rig of any Vessel, if any such change would or could reasonably be expected
to have a material adverse effect on the rights or interest of the Mortgagee to
any of the terms in any of the instruments of insurance referred to in Section
5.01(c) of the Credit Agreement.
(d) The Shipowner may, in the ordinary course of maintenance, repair
or overhaul of each Vessel, remove any item of property constituting a part of
such Vessel, provided such item of property is replaced to the extent necessary
to maintain such Vessel in the condition required herein or in the Credit
Agreement. Any such replacement item of property, shall, without necessity of
further act, become part of such Vessel and subject to this Mortgage.
SECTION 1.12. [Intentionally Omitted]
SECTION 1.13. Without giving prior written notice thereof to the
Mortgagee, the Shipowner will not transfer or change the flag or port of
documentation of any of the Vessels.
SECTION 1.14. The Shipowner will not sell, mortgage or transfer any
Vessel without the prior written consent of the Mortgagee, except as provided in
Section 5.02(o) of the Credit Agreement. The Shipowner will not charter any
Vessel on a demise or bareboat basis, except as permitted in Section 5.02(o) of
the Credit Agreement.
SECTION 1.15. [Intentionally Omitted]
SECTION 1.16. Upon request from the Mortgagee, the Shipowner will
reimburse the Mortgagee promptly, in accordance with Section 10.04 of the Credit
Agreement, for any and all expenditures which the Mortgagee may from time to
time reasonably make, lay out or expend in providing such protection in respect
of insurance, discharge or purchase of liens, taxes, dues, assessments,
governmental charges, fines and penalties lawfully imposed, repairs, attorneys'
fees and other matters as the Shipowner is obligated herein to provide, but
fails to provide. Such obligation of the Shipowner to reimburse the Mortgagee
shall be an additional indebtedness due from the Shipowner, secured by this
Mortgage, and shall be payable by the Shipowner on demand. The Mortgagee, though
privileged so to do, shall be under no obligation to the Shipowner to make any
such expenditures, nor shall the making thereof relieve the Shipowner of any
default in that respect.
SECTION 1.17. [Intentionally Omitted]
SECTION 1.18. In the event that at any time and from time to time
this Mortgage or any provisions hereof shall be deemed invalidated in whole or
in part by reason of any present
5
or future law or any decision of any authoritative court, or if the documents at
any time held by the Mortgagee shall be deemed by the Mortgagee for any reason
insufficient to carry out the true intent and spirit of this Mortgage, then the
Shipowner, forthwith upon the request of the Mortgagee, will execute, on its own
behalf, such other and further assurances and documents as reasonably requested
by the Mortgagee to more effectually subject the Vessels to the payment of the
principal sum of the Obligations, as in this Mortgage provided, and the
performance of the terms and provisions of this Mortgage.
SECTION 1.19. In the event of the requisition (whether of title or
use), condemnation, sequestration, seizure or forfeiture of any Vessel by any
governmental or purported authority or by anyone else, any payments in respect
thereof shall be paid to the Shipowner, and the Shipowner shall cause any such
payment to be applied in accordance with the terms of the Credit Agreement, and
the Shipowner will give prompt written notice to the Mortgagee of all such
events.
ARTICLE II
EVENTS OF DEFAULT AND REMEDIES
SECTION 2.1. In case an "Event of Default" shall have occurred and
be continuing as defined in the Credit Agreement, then, in each and every such
case, the Mortgagee shall have the right to:
(a) declare immediately due and payable all of the Obligations (in
which case all of the same shall be immediately due), and bring suit at law, in
equity or in admiralty, as it may be advised, to recover judgment for the
Obligations and collect the same out of any and all property of the Shipowner
whether covered by this Mortgage or otherwise;
(b) exercise all of the rights and remedies in foreclosure and
otherwise given to mortgagees by the provisions of applicable law, including but
not limited to, the provisions of Chapter 313 of Title 46 of the United States
Code and the regulations in effect thereunder from time to time, as amended;
(c) take and enter into possession of the Vessels, at any time,
wherever the same may be, without court decision or other legal process and
without being responsible for loss or damage, and the Shipowner or other person
in possession forthwith upon demand of the Mortgagee shall surrender to the
Mortgagee possession of the Vessels and the Mortgagee may, without being
responsible for loss or damage, hold, lay up, lease, charter, operate or
otherwise use such Vessels for such time and upon such terms as it may deem to
be for its best advantage, and demand, collect and retain all hire, freights,
earnings, issues, revenues, income, profits, return premiums, salvage awards or
recoveries, recoveries in general average, and all other sums due or to become
due in respect of such Vessels or in respect of any insurance thereon from any
person whomsoever, accounting only for the net profits, if any, arising from
such use of the Vessels and charging upon all receipts from the use of the
Vessels or from the sale thereof by court proceedings or pursuant to subsection
(4) next following, all costs, expenses, charges, damages or losses by reason of
such use; and if at any time the Mortgagee shall avail itself of the right
herein given it to take the Vessels, the Mortgagee shall have the right to dock
the Vessels
6
for a reasonable time at any dock, pier or other premises of the Shipowner
without charge, or to dock them at any other place at the cost and expense of
the Shipowner, and the Mortgagee shall have the right to require the Shipowner
to deliver, and the Shipowner shall on demand, at its own cost and expense,
deliver to the Mortgagee the Vessels as demanded; and the Shipowner hereby
irrevocably instructs the Masters of the Vessels so long as this Mortgage is
outstanding to deliver the Vessels to the Mortgagee as demanded;
(d) inspect and make copies of all original class records held by
the Classification Society relating to such Vessel; and/or
(e) take and enter into possession of the Vessels, at any time,
wherever the same may be, without legal process, and if it seems desirable to
the Mortgagee and without being responsible for loss or damage, sell such
Vessels, at any place and at such time as the Mortgagee may specify and in such
manner and such place (whether by public or private sale) as the Mortgagee may
deem advisable (without necessity of bringing the Vessels to the place
designated for such sale), free from any claim by the Shipowner in admiralty, in
equity, at law or by statute, after first giving notice of the time and place of
any public sale with a general description of the property in the following
manner:
(i) by publishing such notice for 10 consecutive days in a daily
newspaper of general circulation published in New York City;
(ii) if the place of sale should not be New York City, then also by
publication of a similar notice in a daily newspaper, if any, published at
the place of sale; and
(iii) by mailing a similar notice to the Shipowner at its last known
address on the day of first publication;
and notice of the time and place of any private sale by mailing such notice to
the Shipowner at its last known address.
SECTION 2.2. Any sale of any Vessel or any share therein made in
pursuance of this Mortgage, whether under the power of sale hereby granted or
any judicial proceedings, shall operate to divest all right, title and interest
of any nature whatsoever of the Shipowner therein and thereto and shall bar any
claim from the Shipowner, its successors and assigns, and all persons claiming
by, through or under them. No purchaser shall be bound to inquire whether notice
has been given, or whether any default has occurred, or as to the propriety of
the sale, or as to the application of the proceeds thereof. In the case of any
such sale, the Mortgagee shall be entitled, for the purpose of making settlement
or payment for the property purchased, to use and apply the Obligations in order
that there may be credited against the amount remaining due and unpaid thereon
the sums payable out of the net proceeds of such sale with respect to the
Obligations after allowing for the costs and expense of sale and other charges;
and thereupon such purchaser shall be credited, on account of such purchase
price, with the net proceeds that shall have been so credited with respect to
the Obligations. At any such sale, the Mortgagee may bid for and purchase such
property and upon compliance with the terms of sale may hold, retain and dispose
of such property without further accountability therefor.
7
SECTION 2.3. The Mortgagee is hereby appointed attorney-in-fact of
the Shipowner to execute and deliver to any purchaser aforesaid, and is hereby
vested with full power and authority to make, after the occurrence and during
the continuation of an Event of Default, in the name and on behalf of the
Shipowner, a good conveyance of the title to each Vessel so sold. In the event
of any sale of any Vessel, under any power herein contained, the Shipowner will,
if and when required by the Mortgagee, execute such form of conveyance of such
Vessel and other related documents, as the Mortgagee may direct or approve. The
powers and authority granted to the Mortgagee herein have been given for a
valuable consideration and are hereby declared to be irrevocable.
SECTION 2.4. The Mortgagee is hereby appointed attorney-in-fact of
the Shipowner in the name of the Shipowner to, after the occurrence and during
the continuation of an Event of Default, demand, collect, receive, compromise
and ▇▇▇ for, so far as may be permitted by law, all freights, hire, earnings,
issues, revenues, income and profits of each Vessel and all amounts due from
underwriters under any insurance thereon as payments of losses or as return
premiums or otherwise, salvage awards and recoveries of each Vessel, recoveries
in general average or otherwise in respect of any Vessel, and all other sums in
respect of any Vessel, due or to become due at the time of the occurrence and
during the continuation of any Event of Default, or in respect of any insurance
thereon, from any person whomsoever, and to make, give and execute in the name
of the Shipowner acquittances, receipts, releases or other discharges for the
same, whether under seal or otherwise, and to endorse and accept in the name of
the Shipowner all checks, notes, drafts, warrants, agreements and other
instruments in writing with respect to the foregoing. The powers and authority
granted to the Mortgagee herein have been given for a valuable consideration and
are hereby declared to be irrevocable.
SECTION 2.5. Whenever any right to enter and take possession of any
Vessel accrues to the Mortgagee, it may require the Shipowner to deliver, and
the Shipowner shall on demand, at its own cost and expense, deliver to the
Mortgagee such Vessel as demanded. If any legal proceedings shall be taken to
enforce any right under this Mortgage, the Mortgagee shall be entitled as a
matter of right to the appointment of a receiver of such Vessel and of the
freights, hire, earnings, issues, revenues, income and profits due or to become
due and arising from the operation thereof.
SECTION 2.6. The Shipowner authorizes and empowers the Mortgagee or
its appointees or any of them to, after the occurrence and during the
continuation of an Event of Default, appear in the name of the Shipowner, its
successors and assigns, in any court of any country or nation of the world where
a suit is pending against any Vessel because of or on account of an alleged lien
against such Vessel from which such Vessel has not been released and to take
such proceedings as to them or any of them may seem proper towards the defense
of such suit and the purchase or discharge of such lien, and all expenditures
made or incurred by them or any of them for the purpose of such defense or
purchase or discharge shall be a debt due from the Shipowner, its successors and
assigns, to the Mortgagee, and shall be secured by the lien of this Mortgage in
like manner and extent as if the amount and description thereof were written
herein.
SECTION 2.7. The Shipowner covenants that at any time that any
Obligations shall be due and payable (whether by acceleration or otherwise), the
Mortgagee may demand the payment thereof; and in case the Shipowner shall fail
to pay the same forthwith upon such
8
demand, the Mortgagee shall be entitled to recover judgment for the whole amount
so due and unpaid, together with such further amounts as shall be sufficient to
cover the reasonable compensation to the Mortgagee's agents, attorneys and
counsel and any necessary advances, expenses and liabilities made or incurred by
it hereunder. All moneys collected by the Mortgagee under this Section 2.7 shall
be applied by the Mortgagee in accordance with the terms of the Credit
Agreement.
SECTION 2.8. Each and every power and remedy herein given to the
Mortgagee shall be cumulative and shall be in addition to every other power and
remedy herein given or now or hereafter existing at law, in equity, in
admiralty, by statute or under any Credit Document or other agreement, and each
and every power and remedy whether herein given or otherwise existing may be
exercised from time to time and as often and in such order as may be deemed
expedient by the Mortgagee, and the exercise or the beginning of the exercise of
any power or remedy shall not be construed to be a waiver of the right to
exercise at the same time or thereafter any other power or remedy. No delay or
omission by the Mortgagee in the exercise of any right or power or in the
pursuance of any remedy accruing upon any Event of Default shall impair any such
right, power or remedy or be construed to be a waiver of any such Event of
Default or to be an acquiescence therein; nor shall the acceptance by the
Mortgagee of any security or of any payment of or on account of the Obligations
after any Event of Default or of any payment on account of any past Event of
Default be construed to be a waiver of any right to take advantage of any future
Event of Default or of any past Event of Default not completely cured thereby.
SECTION 2.9. If at any time after an Event of Default and prior to
the actual sale of any Vessel by the Mortgagee or prior to any foreclosure
proceedings, the Shipowner offers completely to cure all Events of Default and
to pay all expenses, advances and damages to the Mortgagee consequent on such
Events of Default, with interest at a rate equal to the default rate payable
pursuant to Section 2.05(c)(ii) of the Credit Agreement, then the Mortgagee may,
but shall be under no obligation to, accept such offer, cure and payment and
restore the Shipowner to its former position, but such action shall not affect
any subsequent Event of Default or impair any rights consequent thereon.
SECTION 2.10. In case the Mortgagee shall have proceeded to enforce
any right, power or remedy under this Mortgage by foreclosure, entry or
otherwise, and such proceedings shall have been discontinued or abandoned for
any reason or shall have been determined adversely to the Mortgagee, then and in
every such case the Shipowner and the Mortgagee shall be restored to their
former positions and rights hereunder with respect to the property subject or
intended to be subject to this Mortgage, and all rights, remedies and powers of
the Mortgagee shall continue as if no such proceedings had been taken.
SECTION 2.11. The proceeds of any sale of any Vessel and the net
earnings of any charter operation or drilling contract or other use of any
Vessel by the Mortgagee under any of the powers herein specified in this Article
II, as well as any and all other moneys received by the Mortgagee pursuant to or
under any of the provisions of Article I hereof or this Article II or in any
proceedings pursuant to this Article II, shall be held and applied by the
Mortgagee from time to time as provided in the Credit Agreement. In the event
that the proceeds and amounts referred to above received by the Mortgagee are
insufficient to pay in full the Obligations, the
9
Mortgagee shall be entitled to collect the balance from the Shipowner or from
any other person or entity liable therefor.
SECTION 2.12. Unless and until one or more Events of Default shall
occur and be continuing, the Shipowner (a) shall be suffered and permitted to
retain actual possession and use of the Vessels and (b) to the extent permitted
by Section 5.02(o) of the Credit Agreement shall have the right, from time to
time, in its discretion, and without application to the Mortgagee, and without
obtaining a release thereof by the Mortgagee, to dispose of, free from the lien
hereof, any boilers, engines, generators, drilling machinery and equipment,
pumps and pumping equipment, machinery, masts, spars, sails, rigging, boats,
anchors, cables, chains, tackle, out fit, apparel, furniture, fittings,
equipment, spares, fuel, stores or any other appurtenances of the Vessels,
provided such item of property is replaced as necessary to maintain such Vessel
in the condition required herein or in the Credit Agreement, and such
replacement item, if any, shall forthwith become subject to the lien of this
Mortgage as a first preferred mortgage thereon.
ARTICLE III
SUNDRY PROVISIONS
SECTION 3.1. The maximum principal amount that may be outstanding
under this Mortgage at any time is Eight Hundred Million United States Dollars
(US$800,000,000), and for purposes of recording this Mortgage, the total amount
of this Mortgage is Eight Hundred Million United States Dollars
(US$800,000,000), premium (if any) and interest and performance of mortgage
covenants. There is no separate discharge amount.
SECTION 3.2. All of the covenants, promises, stipulations and
agreements of the Shipowner in this Mortgage contained shall bind the Shipowner
and its successors and assigns and shall inure to the benefit of the Mortgagee
and its successors and assigns. In the event of any assignment of this Mortgage,
the term "Mortgagee" as used in this Mortgage shall be deemed to mean any such
assignee.
SECTION 3.3. Wherever and whenever herein any right, power or
authority is granted or given to the Mortgagee, such right, power or authority
may be exercised in all cases by the Mortgagee or such agent or agents as it may
appoint, and the act or acts of such agent or agents when taken shall constitute
the act of the Mortgagee hereunder.
SECTION 3.4. (a) In the event that any provision of this Mortgage
shall be deemed invalid or unenforceable by reason of any present or future law
or any decision of any court of competent jurisdiction, the validity and
enforceability of any other provision hereof shall not be affected thereby. Any
such invalidity or unenforceability of any provision of this Mortgage in any
jurisdiction or nation shall not render such provision invalid or unenforceable
under the laws of any other jurisdiction or nation.
(b) In the event that this Mortgage or any of the documents or
instruments which may from time to time be delivered hereunder or any provision
hereof shall be deemed invalidated by present or future law of any nation or by
decision of any court, this shall not affect
10
the validity and/or enforceability of all or any other parts of this Mortgage,
or such documents or instruments and, in any such case, the Shipowner covenants
and agrees that, on demand, it will execute and deliver such other and further
agreements and/or documents and/or instruments and do such things as the
Mortgagee in its sole reasonable discretion may deem to be necessary to carry
out the true intent of this Mortgage.
(c) Anything herein to the contrary notwithstanding, it is intended
that nothing herein shall waive the preferred status of this Mortgage and that,
if any provision of this Mortgage or portion thereof shall be construed to waive
the preferred status of this Mortgage, then such provision to such extent shall
be void and of no effect and shall cease to be a part of this Mortgage, without
affecting the remaining provisions, which shall remain in full force and effect.
SECTION 3.5. The Shipowner irrevocably submits itself to the
non-exclusive jurisdiction of any New York State or Federal court sitting in New
York County and any appellate court from any thereof, for the purposes of (and
solely for the purposes of) any suit, action or other proceeding arising out of,
or relating to, this Mortgage or any of the transactions contemplated hereby,
hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard in such New York State or Federal court and hereby
irrevocably waives, and agrees not to assert, by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of the above-named courts for any reason
whatsoever, that such suit, action or proceeding is brought in an inconvenient
forum, or that the venue of such suit, action or proceeding is improper, or that
this Mortgage or the subject matter hereof may not be enforced in or by such
courts. The Shipowner hereby irrevocably consents to the service of any and all
process in any such suit, action or proceeding by the mailing of copies of such
process to the Shipowner at its address listed in Section 3.10 hereof. The
Shipowner agrees that a final judgment in any such action, suit or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Section 3.5
shall affect the right of the Mortgagee to serve legal process in any other
manner permitted by law or affect the right of the Mortgagee to bring any action
or proceeding against the Shipowner or its property in the courts of any other
jurisdiction.
SECTION 3.6. This Mortgage may be executed in any number of
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
SECTION 3.7. The term "Dollars" or the symbol "$" as used herein
shall mean Dollars in any coin or currency of the United States of America which
at the time of payment shall be legal tender for public and private debts.
SECTION 3.8. Upon the termination of this Mortgage pursuant to the
proviso to the Habendum Clause hereof, the Mortgagee, forthwith upon the request
of the Shipowner, will execute, on its own behalf, such other and further
assurances and documents as requested by the Shipowner to effect such
termination and to remove the lien of record of this Mortgage, all at the cost
and expense of the Shipowner.
11
SECTION 3.9. THE SHIPOWNER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS MORTGAGE.
SECTION 3.10. All notices or other communications required or
permitted to be made or given hereunder shall be made in writing and personally
delivered to an officer or other responsible employee of the addressee, or sent,
by registered air mail, return receipt requested, postage prepaid, facsimile
transmission, or other direct written electronic means to the applicable address
set forth under such party's name below, or to such other address as each party
hereto may from time to time designate to the others in such manner:
If to the Mortgagee:
Citibank, N.A.
Global Shipping & Logistics, New York
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Holland & Knight LLP
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Jovi Tenev
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Shipowner:
Pride Offshore, Inc.
c/o Pride International, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Executive Vice President and Chief Financial
Officer
Any communication personally delivered shall be deemed to have been
validly and effectively given or delivered on the date of such delivery. Any
communication transmitted by facsimile or by registered air mail shall be deemed
to have been validly and effectively given or delivered on the day when
received.
SECTION 3.11. If any Vessel is reflagged as permitted by Section
5.02(y) of the Credit Agreement or is sold, transferred, conveyed or otherwise
disposed of as permitted by the Credit Agreement, such Vessel shall be promptly
released in writing by the Mortgagee from the
12
lien of this Mortgage and such release shall not affect the Mortgagee's lien on
the remaining Vessels.
[The rest of this page has been left intentionally blank.]
13
IN WITNESS WHEREOF, the Shipowner has executed this Mortgage on the
day and year first above written.
PRIDE OFFSHORE, INC.
By _________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
STATE OF _______________ )
) ss. :
COUNTY OF ____________ )
On this __ day of _______, 2004, before me personally appeared
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, to me known, who being by me duly sworn, did depose and say
that s/he resides at ______________________________________________________;
that s/he is an authorized individual of PRIDE OFFSHORE, INC., the corporation
described in and which executed the foregoing instrument; and that s/he signed
her/his name thereto by order of the Board of Directors of said corporation and
that said instrument is the act and deed of said corporation.
-------------------------------
Notary Public
EXHIBIT A
TO
FIRST PREFERRED MORTGAGE
[Copy of the Master Vessel and Trust Agreement]
EXHIBIT B
TO
FIRST PREFERRED MORTGAGE
[Copy of the Credit Agreement with certain exhibits]
SCHEDULE I
TO FIRST PREFERRED MORTGAGE
DESCRIPTION OF THE VESSELS
(including the current classification)
EXHIBIT P-2
FORM OF ASSIGNMENT OF INSURANCES
Pride Offshore, Inc. (the "Borrower"), a corporation organized and
existing under the laws of the State of Delaware, Pride Drilling, LLC ("Pride
Drilling"), a limited liability company organized and existing under the laws of
the State of Delaware, Pride Central America, LLC ("Pride Central America"), a
limited liability company organized and existing under the laws of the State of
Delaware, Pride Offshore International LLC ("Pride Offshore International"), a
limited liability company organized and existing under the laws of the State of
Delaware, Mexico Drilling Limited LLC ("Mexico Drilling"), a limited liability
company organized and existing under the laws of the State of Delaware, Pride
South Pacific LLC ("Pride South Pacific"), a limited liability company organized
and existing under the laws of the State of Delaware, and Pride North America
LLC ("Pride North America"), a limited liability company organized and existing
under the laws of the State of Delaware (Borrower, Pride Drilling, Pride Central
America, Pride Offshore International, Mexico Drilling, Pride South Pacific and
Pride North America each an "Assignor", and collectively, the "Assignors"), each
the owner of the vessel(s) listed next to its name on Schedule I attached hereto
(the "Vessels"), in consideration of One Dollar ($1) lawful money of the United
States of America and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, has sold, assigned, transferred
and set over, and by this instrument does sell, assign, transfer and set over
unto Citibank, N.A., as Collateral Agent and its successors and assigns as such
(the "Assignee"), for the benefit of the Lenders (the "Lenders") defined under
that certain Credit Agreement dated as of July 7, 2004, (as such agreement may
be amended, supplemented or otherwise modified from time to time, the "Credit
Agreement") among, inter alia, the Borrower, the Lenders, the Guarantors named
therein, the Issuing Banks (as defined therein), Citicorp North America, Inc.,
as Administrative Agent and Citibank, N.A., as Collateral Agent, and unto the
Assignee's successors and assigns, to its and its successors' and assigns' own
proper use and benefit, and, as security for all of the obligations of the
Borrower, the Parent and any Subsidiary under the Credit Agreement, the other
Credit Documents and any Hedging Agreement, and the payment of all other sums of
money (whether for principal, premium, if any, interest, fees, indemnity,
expenses or otherwise) from time to time payable by the Borrower, the Parent and
any Subsidiary thereunder, and to secure the performance and observance of all
agreements, covenants and provisions contained in this Assignment, the Credit
Agreement and the other Credit Documents and under any Hedging Agreement
(collectively, the "Obligations"), all right, title and interest of each
Assignor under, in and to (i) all insurances other than excess liability
insurances in respect of the Vessels, whether heretofore, now or hereafter
effected, and all renewals of or replacements for the same (the "Insurances"),
(ii) all claims, returns of premium and other moneys and claims for moneys due
and to become due under or in respect of the Insurances, (iii) all other rights
of each Assignor under or in respect of the Insurances and (iv) any proceeds of
any of the foregoing. Capitalized terms used herein and not otherwise defined
are used herein as defined in the Credit Agreement.
Section 1. Representations, Warranties and Covenants. Each Assignor
hereby warrants and represents that each of the Insurances is in full force and
effect and is enforceable in accordance with its terms and that the Assignors
are not in default thereunder. Each Assignor hereby further warrants and
represents that, as of the date hereof, there is no effective assignment, pledge
or security interest in, the whole or any part of the right, title and interest
hereby assigned to the Assignee, except any such assignment, pledge or security
interest in favor of the Assignee. Each Assignor hereby covenants that, without
the prior written consent thereto of the Assignee, so long as this Assignment
shall remain in effect, it will not assign or pledge the whole or any part of
the right, title and interest hereby assigned to anyone other than the
Assignee, and it will not take or omit to take any action not permitted by
Section 5.01(c) of the Credit Agreement, the taking or omission of which might
result in an alteration or impairment of the Insurances in any material respect,
or of this Assignment or of any of the rights created by the Insurances or this
Assignment.
Each Assignor hereby further covenants and agrees to use
commercially reasonable efforts to procure that notice of this Assignment shall
be duly given to all underwriters and insurers and that where the consent of any
underwriter or insurer is required pursuant to any of the Insurances assigned
hereby, such Assignor shall use commercially reasonable efforts to obtain such
consent and evidence thereof, which evidence shall be given to the Assignee, or,
in the alternative, that in the case of protection and indemnity coverage (if
any), each Assignor shall use commercially reasonable efforts to obtain, with
the Assignee's approval (which shall not be unreasonably withheld), a letter of
undertaking by the underwriters or clubs, and that there shall be duly endorsed
upon all slips, cover notes, policies, certificates of entry or other
instruments issued or to be issued in connection with the Insurances assigned
hereby such clauses as to additional assured and loss payees as the Assignee may
reasonably require or approve. In all cases (except in the case of protection
and indemnity coverage through a protection and indemnity association), unless
otherwise agreed in writing by the Assignee (which shall not be unreasonably
withheld), each Assignor shall use commercially reasonable efforts to cause such
slips, cover notes, notices, certificates of entry or other instruments to show
the Assignee as additional assured and each Assignor shall use commercially
reasonable efforts to cause such policies to provide that there will be no
recourse against the Assignee for payment of premiums, calls or assessments.
Each Assignor hereby further covenants and agrees to cause its
insurance brokers to agree to advise the Assignee as soon as is reasonably
practicable by facsimile addressed to it at its address, as specified in this
Assignment, of any lapse of any such insurance by expiration, termination,
failure to renew or otherwise and of any default in payment of any premium in
respect of any insurance on any Vessel. The Assignee shall not be deemed to have
knowledge of any such lapse of insurance in the absence of receipt of notice
from such brokers. Each Assignor will also cause such brokers to agree to ▇▇▇▇
their records and to advise the Assignee, by facsimile, addressed as provided
above in this subsection, at least fourteen days prior to the expiration date of
any insurance carried pursuant to this Assignment, whether such insurance has
been renewed or replaced with new insurance which complies with the provisions
of Section 5.01(c) of the Credit Agreement. In addition, each Assignor will
cause each insurance company, underwriter, club or fund (or an authorized agent
thereof) with respect to all insurance required thereby to agree in writing for
the benefit of the Assignee that each policy or contract issued by such
insurance company, underwriter, club or fund shall not lapse, expire, terminate
or be cancelled for any reason whatsoever without at least fourteen days' prior
facsimile or cable notice to the Assignee addressed as provided above in this
subsection.
Each Assignor agrees that at any time and from time to time, upon
the written request of the Assignee, it will promptly and duly execute and
deliver any and all such further instruments and documents as the Assignee may
reasonably request in order to obtain the full benefits of this Assignment and
of the rights and powers herein granted.
Any payments to the Assignee made pursuant to the terms hereof shall
be made to such account as may, from time to time, be designated by the
Assignee.
Section 2. Freedom of Assignee from Obligations. It is hereby
expressly agreed that anything herein contained to the contrary notwithstanding,
the Assignors shall remain liable under the Insurances to perform all of the
obligations assumed by them thereunder, and the
Assignee shall have no obligation or liability (including, without limitation,
any obligation or liability with respect to the payment of premiums, calls or
assessments) under the Insurances by reason of or arising out of this
Assignment. The Assignee shall not be required or obligated in any manner to
perform or fulfill any obligations of any Assignor under or pursuant to the
Insurances or to make any payment or to make any inquiry as to the nature or
sufficiency of any payment received by the Assignee or to present or file any
claim, or to take any other action to collect or enforce the payment of any
amounts which may have been assigned to it or to which it may be entitled
hereunder at any time or times.
Section 3. Power of Attorney; Financing Statements. The Assignee is
hereby constituted the lawful attorney, irrevocably, with full power (in the
name of the respective Assignor or otherwise) if an Event of Default has
occurred and is continuing to ask, require, demand, receive, compound and give
acquittance for any and all moneys and claims for moneys due and to become due
under or arising out of the Insurances, to endorse any check or other
instruments or orders in connection therewith and to file any claims or take any
action or institute any proceedings which the Assignee may deem to be necessary
or advisable in the premises. Any action or proceeding brought by the Assignee
pursuant to any of the provisions hereof or of the Insurances, and any claim
made by the Assignee hereunder or under the Insurances, may be compromised,
withdrawn or otherwise dealt with by the Assignee without any notice to, or
approval of, the Assignors if an Event of Default has occurred and is
continuing. Each Assignor hereby irrevocably authorizes the Assignee, at the
Assignors' expense, to file, at any time and from time to time, such financing
and continuation statements or papers of similar purpose or effect relating to
this Assignment, without any Assignor's signature, as the Assignee at its option
may deem appropriate. Each Assignor hereby appoints the Assignee as its
attorney-in-fact to execute any such statements in such Assignor's name and to
perform all other acts which the Assignee may deem appropriate to perfect and
continue the security interests conferred hereby.
Section 4. Irrevocable Assignment. The powers and authority granted
to the Assignee herein have been given for a valuable consideration and are
hereby declared to be irrevocable and may not be amended or waived except by an
instrument in writing signed by the party against whom enforcement is sought.
Section 5. Conditions of Assignment. Unless and until an Event of
Default shall have occurred and be continuing under the Credit Agreement, and
Assignee has given notice in writing to each Assignor of such Event of Default,
and Assignee's intent to exercise its rights hereunder, each Assignor shall be
entitled to exercise all its rights under the Insurances (subject to the
provisions of this Assignment) in all respects as if this Assignment had not
been made.
Section 6. Governing Law.
(a) This Assignment shall be construed in accordance with and
governed by the laws of the State of New York, United States of America, without
regard to its conflict of laws rules (other than Section 5-1401 of the New York
General Obligations Law). Each Assignor hereby irrevocably submits itself to the
non-exclusive jurisdiction of any New York State or Federal court sitting in New
York County and any appellate court from any thereof, for the purposes of (and
solely for the purposes of) any suit, action or other proceeding arising out of,
or relating to, this Assignment or any of the transactions contemplated hereby,
hereby irrevocably agrees that all claims in respect of such action or
proceeding may be heard in such New York State or Federal court and hereby
irrevocably waives, and agrees not to assert, by way of motion, as a defense, or
otherwise, in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of the above-named courts for any reason
whatsoever, that such suit, action or proceeding is brought in an inconvenient
forum, or that the venue of such
suit, action or proceeding is improper, or that this Assignment or the subject
matter hereof may not be enforced in or by such courts. Each Assignor
irrevocably consents to the service of any and all process in any such suit,
action or proceeding by the mailing of copies of such process to the relevant
Assignor at its address specified below. Each Assignor agrees that a final
judgment in any such action, suit or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this paragraph shall affect the right of the
Assignee to serve legal process in any other manner permitted by law or affect
the right of the Assignee to bring any action or proceeding against any Assignor
or its property in the courts of any other jurisdiction.
(b) BY ITS SIGNATURE BELOW WRITTEN EACH ASSIGNOR HEREBY IRREVOCABLY
WAIVES UNDER APPLICABLE LAW ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS ASSIGNMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 7. Notices. All notices or other communications required or
permitted to be made or given hereunder shall be made in writing, in English,
and personally delivered to an officer or other responsible employee of the
addressee, or sent, by registered air mail, return receipt requested, postage
prepaid, facsimile transmission, or other direct written electronic means to the
applicable address set forth under such party's name below, or to such other
address as any party hereto may from time to time designate to the others in
such manner:
If to the Assignee:
Citibank, N.A., as Collateral Agent.
Global Shipping & Logistics, New York
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Director
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Holland & Knight LLP
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Jovi Tenev
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Assignor:
c/o Pride International, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
ATTN: Treasurer with copies to its Assistant Treasurer-Treasury
Operations and General Counsel
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Any communication personally delivered shall be deemed to have been
validly and effectively given or delivered on the date of such delivery. Any
communication transmitted by facsimile, or other direct written electronic
means, or by registered air mail, shall be deemed to have been validly and
effectively given or delivered on the day when received.
Section 8. Headings. The division of this Assignment into sections
and the insertion of headings are for convenience of reference only and shall
not affect the interpretation or construction of this Assignment.
Section 9. Termination. This Assignment shall terminate, and be of
no further force and effect, upon the payment in full of all of the Obligations,
the termination or expiration of the Credit Agreement and all Letters of Credit,
and the performance and observance of all agreements, covenants and provisions
contained in the Credit Agreement and the other Credit Documents.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, each Assignor have duly caused this
Assignment to be duly executed this __ day of July, 2004.
PRIDE OFFSHORE, INC.
By: _________________________________
Name:
Title:
PRIDE DRILLING, LLC
By: _________________________________
Name:
Title:
PRIDE CENTRAL AMERICA, LLC
By: _________________________________
Name:
Title:
PRIDE OFFSHORE INTERNATIONAL LLC
By: _________________________________
Name:
Title:
MEXICO DRILLING LIMITED LLC
By: _________________________________
Name:
Title:
PRIDE SOUTH PACIFIC LLC
By: _________________________________
Name:
Title:
PRIDE NORTH AMERICA LLC
By: _________________________________
Name:
Title:
The terms and conditions of
this Assignment are hereby
ACCEPTED BY:
CITIBANK, N.A.
as Collateral Agent
By: ___________________________
Name:
Title:
SCHEDULE I
Description of Vessels
NAME OWNER
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NOTICE OF ASSIGNMENT
EACH OF PRIDE OFFSHORE, INC., PRIDE CENTRAL AMERICA, LLC, PRIDE
DRILLING, LLC, PRIDE OFFSHORE INTERNATIONAL LLC, MEXICO DRILLING LIMITED LLC,
PRIDE SOUTH PACIFIC LLC and PRIDE NORTH AMERICA LLC (together, the "Owners"),
owner of the respective vessels listed next to its name on Schedule I attached
hereto (the "Vessels"), HEREBY GIVES NOTICE that by an Assignment of Insurances
dated July __, 2004 and made by the Owners to Citibank, N.A. as Collateral
Agent, and its successors and assigns as such (the "Assignee"), pursuant to, and
for the benefit of the Lenders as defined under, that certain Credit Agreement
dated as of July __, 2004 (as such agreement may be amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), among, inter
alia, Pride Offshore, Inc., as Borrower, the Lenders named therein, the
Guarantors named therein, the Issuing Banks named therein, Citicorp North
America, Inc., as the Administrative Agent and Citibank, N.A., as Collateral
Agent, each Owner collaterally assigned to the Assignee all of such Owner's
right, title and interest in and to all insurances other than excess liability
insurance and the benefit of all insurances (other than excess liability
insurance) heretofore, now or hereafter taken out in respect of the Vessels.
This Notice and the attached Loss Payable Clauses are to be endorsed on all
policies evidencing such insurances.
Dated: July __, 2004
PRIDE OFFSHORE, INC.
By:______________________
Name:
Title:
PRIDE DRILLING, LLC
By:______________________
Name:
Title:
PRIDE CENTRAL AMERICA, LLC
By:______________________
Name:
Title:
PRIDE OFFSHORE INTERNATIONAL LLC
By:______________________
Name:
Title:
MEXICO DRILLING LIMITED LLC
By:______________________
Name:
Title:
PRIDE SOUTH PACIFIC LLC
By:______________________
Name:
Title:
PRIDE NORTH AMERICA LLC
By:______________________
Name:
Title:
SCHEDULE I
Description of Vessels
NAME OWNER
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LOSS PAYABLE CLAUSES
Hull and War Risks
Loss, if any, payable to Citibank, N.A., in its capacity as
Collateral Agent pursuant to, and for the benefit of the Lenders (the "Lenders")
defined under that certain Credit Agreement dated as of July 7, 2004 (as the
same may be amended, supplemented or otherwise modified from time to time, the
"Credit Agreement") among the Borrower, the Lenders (as defined therein), the
Guarantors named therein, and the Issuing Banks (as defined therein), Citicorp
North America, Inc., as Administrative Agent and Citibank, N.A., as Collateral
Agent to Citibank, N.A., as Collateral Agent (the "Collateral Agent") for
distribution by it first to the Collateral Agent and then to the relevant
Shipowner as their respective interests may appear, or order, except that,
unless the underwriters receive written notice from the Collateral Agent that an
Event of Default (as defined in the Credit Agreement) has occurred and is
continuing, in the case of any loss involving any damage to any Vessel or
liability of any Vessel, the underwriters may pay directly for the repair,
salvage, liability or other charges involved or, if the Shipowner shall have
first fully repaired the damage and paid the cost thereof, or discharged the
liability or paid all of the salvage or other charges, then the underwriters may
pay the Shipowner as reimbursement therefor, provided, however, that if such
damage involves a loss in excess of U.S. $5,000,000 or its equivalent the
underwriters shall not make such payment without first obtaining the written
consent thereto of the Collateral Agent.
In the event of an actual or constructive total loss or a
compromised or arranged total loss or requisition of title of any Vessel, all
insurance payments therefor shall be paid to the Collateral Agent, for
distribution by it in accordance with the terms of the Credit Agreement.
EXHIBIT P-3
FORM OF MASTER VESSEL TRUST AGREEMENT
THIS MASTER VESSEL AND TRUST AGREEMENT (this "Trust Agreement") is
made and entered into as of July 7, 2004 between (A) Citibank, N.A., as
Collateral Agent (the "Agent") on behalf of itself and the Lenders (as defined
below) under the Credit Agreement (as defined below) and (B) Citibank, N.A., as
trustee (the "Trustee"). Capitalized terms used herein and not otherwise defined
are used herein as defined in that certain Credit Agreement dated as of July 7,
2004, (as such agreement may be amended, supplemented or otherwise modified from
time to time, the "Credit Agreement") among Pride Offshore, Inc. (the
"Borrower"), the Guarantors, the Lenders, Citicorp North America, Inc., as
Administrative Agent, Citibank, N.A., as Collateral Agent, and the Issuing Banks
(all as defined therein).
W I T N E S S E T H :
WHEREAS,
(A) In accordance with the terms of the Credit Agreement, the Lenders
and the Issuing Banks have made available to the Borrower Advances up to the
aggregate principal amount of U.S. $800,000,000. In addition, the Borrower may
enter into certain Hedging Agreements with one or more Secured Hedge Providers;
(B) The obligations of the Borrower, the Parent, or any Subsidiary under
the Credit Documents are defined collectively in the Credit Agreement as the
"Obligations";
(C) In accordance with the terms of the Credit Agreement, the
Obligations are to be secured by, inter alia, preferred ship mortgages granted
by the Borrower in favor of the Trustee on behalf of the Agent and the Lenders,
the Issuing Banks and any Secured Hedge Provider over all Vessels (as defined
below) owned by the Borrower that are part of the Collateral;
(D) The Obligations also are to be secured by, inter alia, guarantees
granted by the Guarantors from time to time parties to the Credit Agreement, and
those Guarantors that are the owners of Vessels that constitute part of the
Collateral will secure their respective guarantees by granting preferred ship
mortgages on the Vessels owned by them respectively in favor of the Trustee on
behalf of the Agent and the Lenders, the Issuing Banks and any Secured Hedge
Provider;
(E) Preferred ship mortgages as of the date hereof are to be granted by
the Borrower and the Guarantors over the Vessels listed in Schedules I, II, and
III hereof; and
(F) The Agent and the Lenders, the Issuing Banks and any Secured Hedge
Provider desire the Trustee to hold the Mortgages (as defined below) as
Mortgagee in accordance with the terms of this Trust Agreement, and the Trustee
is willing to hold the Mortgages as mortgagee in accordance with the provisions
hereof, all as hereinafter set forth,
NOW, THEREFORE, in consideration of the mutual premises, and subject
to the terms and conditions provided herein, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01. For all purposes of this Trust Agreement, the
following terms shall have the meanings specified below and such meanings are
equally applicable both to the singular and plural forms of the terms defined
where appropriate:
(a) "Actual Knowledge" shall mean actual knowledge of an officer of
the Trustee who, in the normal performance of his or her operational duties,
would have knowledge of such matters and the requirements with respect thereto.
(b) "Agent" shall have the meaning given that term in the Preamble.
(c) "Credit Agreement" shall have the meaning given that term in the
Preamble.
(d) "Enforcement" shall mean the exercise of any remedy provided for
under any Mortgage or otherwise available by applicable law upon the occurrence
of an event of default under any Mortgage.
(e) "Mortgages" shall mean collectively, the preferred ship
mortgages in favor of the Trustee covering (x) the Vessels listed on Schedules
I, II and III hereof, and (y) covering any other Vessels that may be identified
from time to time by the Agent to the Trustee, as each such mortgage may be
amended, supplemented or modified from time to time.
(f) "Obligations" shall have the meaning defined in the Credit
Agreement.
(g) "Obligors" shall mean collectively, Pride Offshore, Inc. as
Borrower and Pride Drilling, LLC, Pride Central America, LLC, Pride Offshore
International LLC, Mexico Drilling Limited LLC, Pride South Pacific LLC and
Pride North America LLC as Guarantors, and any other entity that owns Vessels
that are part of the Collateral and that becomes a Guarantor under and in
accordance with the terms of the Credit Agreement.
(h) "Panama Vessels" shall mean the Panama documented Vessels
described in Schedule II hereto.
(i) "Trust Agreement" shall mean this agreement as amended,
supplemented or otherwise modified from time to time, together with all Exhibits
and Schedules hereto.
(j) "Trust Estate" shall mean, and consist of, (i) the Mortgages,
(ii) the Vessels, and (iii) funds and other property which the Trustee acquires
in its capacity as Trustee or mortgagee in connection with the Mortgages or the
Vessels.
(k) "Trust Receipt" shall mean a receipt, substantially in the form
of Exhibit A hereto, given by the Trustee to the Agent upon receipt of the
executed Mortgages.
(l) "Trustee" shall have the meaning given that term in the
Preamble, and any successor trustee.
(m) "United States Vessels" shall mean the United States documented
Vessels described in Schedule I attached hereto.
(n) "Vanuatu Vessels" shall mean the Vanuatu documented
Vessels described in Schedule III attached hereto.
(o) "Vessels" shall mean the United States Vessels, the Panama
Vessels and the Vanuatu Vessels and any other vessels that constitute part of
the Collateral from time to time under and in accordance with the terms of the
Credit Agreement as identified by the Agent to the Trustee.
ARTICLE II
DECLARATION OF TRUST
Section 2.01. The Trustee hereby declares that it will hold the
Trust Estate upon the trust hereinafter set forth, subject to, and upon the
terms and conditions of this Trust Agreement, for the sole use and benefit of
the Agent in accordance with the terms of the Credit Agreement.
ARTICLE III
TRANSFER OF PROPERTY TO TRUST
Section 3.01. The Agent hereby authorizes the Trustee and the
Trustee hereby agrees to accept as a part of the Trust Estate the Mortgages. The
Trustee is hereby instructed to execute and deliver as mortgagee the Mortgage
covering the Panama Vessels and to accept as Mortgagee the Mortgages covering
the United States Vessels and the Vanuatu Vessels. At any time hereafter and
from time to time, the Trustee shall execute or enter into or accept, as the
case may be, as mortgagee, additional Mortgages upon written direction of the
Agent. The Trustee shall issue to the Agent a Trust Receipt for the Mortgages
upon their delivery to the Trustee as part of the Trust Estate.
Section 3.02. Upon satisfaction or discharge of the Obligations, the
Agent shall so notify the Trustee. The Trustee shall execute and deliver to the
Agent such satisfaction or discharge of the Mortgages as the Agent may request,
all at the Agent's cost and expense. Upon satisfaction or discharge of the lien
provided for in the Mortgages, the Agent shall return the respective Trust
Receipt to the Trustee for cancellation and thereafter the Trustee shall return
the Mortgages to the Agent, at which time the Mortgages shall be deemed
withdrawn from the Trust Estate.
Section 3.03. The Agent shall deliver from time to time at the
request of the Trustee a certificate setting forth the principal amount of
Obligations then outstanding.
ARTICLE IV
DUTIES OF THE TRUSTEE
Section 4.01. The Trustee shall take such action with respect to any
event of default under the Mortgages as shall be specified in any notice of such
default or Enforcement event and written instructions of the Agent, but the
Trustee shall not be required to take any action not expressly set forth in such
written instructions. If the approval of any governmental agency or body is
required in order to carry out the instructions of the Agent, the Trustee shall
not be required to carry out such instructions unless such approval first shall
have been obtained by the Agent.
Section 4.02. The Trustee shall not have any duty or obligation to
manage, operate, control, use, sell, make investments in respect of, dispose of
or otherwise deal with the Vessels or any other part of the Trust Estate or to
otherwise take or refrain from taking any action under, or in connection with
the Mortgages, except as expressly provided by the terms of this Trust Agreement
or as expressly provided in written instructions received from the Agent. Except
for the accounting for monies or things actually received by it as Trustee
hereunder the Trustee shall have no duties as to any monies, instruments or
securities. The Trustee shall not be obligated or required, and this Trust
Agreement shall not be construed so as to obligate or require the Trustee, to
expend or risk its own funds or incur any financial responsibility in the
performance of any of its duties under this Trust Agreement, to file any reports
or other matters with any governmental authority relating to the matters hereof
other than those required to be filed by the Trustee as a depository
institution. The Trustee shall not be obligated or required to follow any
written instructions received from any Lender or any Person (as defined in the
Credit Agreement) other than the Agent.
Section 4.03. In the event the Trustee shall be unable to act as
trustee under any applicable governmental rule or regulation, the sole
obligation of the Trustee hereunder shall be to advise the Agent promptly of any
such fact of which it has Actual Knowledge and to resign under this Trust
Agreement, if requested by the Agent. The Trustee shall have no liability to the
Agent, the Lenders, the Obligors, or any other Person by reason of its failure
to be or remain
qualified to act under applicable law as trustee, except that the Trustee agrees
to pay its own costs and expenses, including, without limitation, legal counsel
fees and expenses, in connection with any resignation under this Section 4.03.
Section 4.04. The Trustee shall furnish promptly to the Agent each
communication received by it or a copy thereof relating to any of the Mortgages,
but shall have no duty to act upon or reply to any such communication in the
absence of written instructions from the Agent.
Section 4.05. The Trustee shall keep custody of any cover notes,
insurance policies, brokers' opinion letters, or other documents delivered to it
from time to time as may be required by any of the Mortgages and shall promptly
give copies thereof to the Agent. The Trustee shall have no duty to advise the
Agent or the Lenders or any other Person of its failure to receive in timely
fashion any such insurance document, and the responsibility of determining if
any insurance document does not comply with the requirements of the Mortgages
shall be solely that of the Agent.
Section 4.06. The Trustee shall be entitled to release any of the
Vessels from the lien created by such of the Mortgages as shall be applicable,
to enter into amendments or supplements to any of such Mortgages to evidence the
subjection of additional vessels to the respective lien thereof, otherwise
modify the terms thereof, or to otherwise add property to or release property
from the Trust Estate, in each case upon written instruction of the Agent.
ARTICLE V
CONCERNING THE TRUSTEE
Section 5.01. The Trustee accepts the trust hereby created and
agrees to perform such trust but only upon the terms of this Trust Agreement.
The Trustee shall not be answerable or accountable to the Agent, the Lenders,
the Obligors or any other Person under any circumstances, except for its own
willful misconduct or gross negligence.
Section 5.02. Except in accordance with written instructions
furnished pursuant to Section 4.01 or Section 4.06 hereof, and without limiting
the generality of Section 4.02 hereof, the Trustee shall have no duty (a) to
record, file or deposit the Mortgages or any amendments thereto, (b) to effect
or maintain any insurance on the Vessels, (c) to pay or discharge any tax,
assessment or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against, any part of the Trust Estate,
(d) to confirm or verify any notices or reports of the Obligors other than to
furnish the Agent with a copy of each notice or report furnished the Trustee by
the Obligors pursuant to the Mortgages or (e) to inspect the Vessels at any time
or ascertain or inquire as to the performance or observance of the Obligors'
covenants under the Mortgages or whether any default shall have occurred
thereunder.
Section 5.03. THE TRUSTEE MAKES NO REPRESENTATION OR WARRANTY AS TO:
(a) THE VALIDITY, LEGALITY, ENFORCEABILITY, PREFERRED STATUS OR PRIORITY OF THE
MORTGAGES OR AS TO THE CORRECTNESS OF ANY STATEMENT CONTAINED IN ANY THEREOF, OR
AS TO ITS TITLE THERETO; (b) THE TITLE, DOCUMENTATION, SEAWORTHINESS, VALUE,
CONDITION OR FITNESS FOR USE OF THE VESSELS, OR ANY OTHER REPRESENTATION OR
WARRANTY WITH RESPECT THERETO; OR (c) THE VALIDITY, LEGALITY OR ENFORCEABILITY
OF THIS TRUST AGREEMENT OR ANY DOCUMENT HEREBY CONTEMPLATED, except that the
Trustee represents and warrants that this Trust Agreement and any other
instrument executed by the Trustee have been or will be executed by an officer
duly authorized to execute them on its behalf.
Section 5.04. No monies received by the Trustee hereunder need be
segregated in any manner except to the extent required hereunder or by law and
the Trustee shall not be liable for any interest thereon.
Section 5.05. The Trustee shall incur no liability to anyone in
acting upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper believed by
it in good faith to be genuine and believed by it in good faith to be signed by
the proper party or parties. The Trustee may accept a copy of a resolution of
the board of directors of any corporate party, certified by the secretary, an
assistant secretary or any other officer of said party, as duly adopted and in
full force and effect, as conclusive evidence that such resolution has been
adopted by said board and is in full force and effect. As to any fact or matter,
the manner of ascertainment of which is not specifically described herein, the
Trustee may for all purposes hereof rely in good faith on a certificate, signed
by or on behalf of the party executing such certificate, as to such fact or
matter, and such certificate shall constitute full protection to the Trustee for
any action taken or omitted to be taken by it in good faith in reliance thereof.
In the administration of the Trust Estate, the Trustee may perform its powers
and duties hereunder directly or through other agents or attorneys and may, at
the cost and expense of the Agent, seek advice of counsel (including counsel for
the Agent, the Lenders or the Obligors), accountants and other skilled persons
to be selected and employed by it, and the Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
actions, advice or opinion of any such counsel, agents, accountants or other
skilled persons.
Section 5.06. In accepting the trust hereby created, the Trustee
acts solely as trustee hereunder and not in its individual capacity, and the
Trustee shall have no liability hereunder or under the Mortgages, except as
expressly set forth herein or therein.
ARTICLE VI
INDEMNIFICATION OF THE TRUSTEE BY THE AGENT
Section 6.01. The Agent shall, whether or not any of the
transactions contemplated hereby shall be consummated, assume liability for, and
indemnify, protect, save and keep harmless the Trustee and its respective
successors, assigns, agents and servants, from and against any and all
liabilities, obligations, losses, damages, penalties, taxes (such term "taxes"
or the term "tax" as used in this Section 6.01 shall include, without
limitation, all taxes specifically related to this Trust Agreement and the Trust
Estate created hereby excluding, however, any income, franchise or similar taxes
on fees or other compensation, if any, received by the Trustee in its capacity
as Trustee), claims, actions, suits, costs, expenses or disbursements
(including, without limitation, legal fees and expenses) of any kind and nature
whatsoever which may be imposed on or incurred by or asserted against the
Trustee, its respective successors, assigns, agents or servants, by whomsoever
asserted, in any way specifically relating to or arising out of this Trust
Agreement, or any of the Mortgages, the Trust Estate, or the performance or
enforcement of any of the terms thereof, or in any way relating to or arising
out of the financing, refinancing, mortgaging, manufacture, purchase,
acceptance, rejection, ownership, delivery, lease, possession, use, operation,
condition, sale, return or other disposition of the Vessels (including, without
limitation, latent and other defects, whether or not discoverable, and any claim
for patent, trademark or copyright infringement), or in any way relating to or
arising out of the administration of the Trust Estate, or to the action or
inaction of the Trustee hereunder, except only in the case of willful misconduct
or gross negligence by the Trustee. The indemnities contained in this Section
6.01 shall survive the termination of this Trust Agreement. If the Trustee shall
be entitled to indemnification, the Trustee shall have a lien on the Trust
Estate prior to any interest therein of the Agent or the Lenders or any other
Person.
Section 6.02. The indemnity provided in Section 6.01 shall not apply
to any costs, expenses or other liabilities incurred by the Trustee in the
preservation of the status which it holds at the date of entering into this
Trust Agreement.
ARTICLE VII
TRANSFER OF THE AGENT'S INTEREST
Section 7.01. None of the Agent, the Lenders, the Issuing Banks or
any Secured Hedge Provider shall assign, convey or otherwise transfer any of its
right, title or interest in and to this Trust Agreement, the Trust Estate or any
part thereof except (i) in compliance with the Credit Agreement or (ii) with the
prior written consent of the Trustee. In connection with any conveyance or
transfer described above, the Trustee shall execute and deliver such instruments
or do such acts as the Agent may require, at the cost and expense of the Agent,
in order to consummate such assignment, conveyance or transfer.
ARTICLE VIII
PROCEDURE FOR ENFORCEMENT
Section 8.01. Upon receipt of a notice and instructions provided for
in Section 4.01 hereof, the Trustee shall proceed to exercise such rights and
remedies available to it under the Mortgages as the Agent shall, from time to
time, instruct it to exercise.
Section 8.02. If so instructed by the Agent, the Trustee shall, in
connection with any Enforcement, employ attorneys, experts, consultants,
managers, security guards, insurance brokers, inspectors or any other Persons or
entities deemed desirable by the Agent.
Section 8.03. If so instructed by the Agent, the Trustee shall file
such suits or actions or bring such proceedings before any court or agency in
connection with the enforcement of the Mortgages or any of them in its own name
in its capacity as Trustee, or shall join in any such suits, actions or
proceedings as co-plaintiff with the Agent, the Lenders or the Issuing Banks or
any Secured Hedge Provider, as the case may be, as the Agent deems necessary or
desirable. The conduct of such suits, actions or proceedings shall be in
accordance with instructions from the Agent.
Section 8.04. If so instructed by the Agent, the Trustee shall, in
connection with any Enforcement, provided the same be lawful, do any or all of
the following:
(a) operate the Vessels under any of the Mortgages;
(b) conduct a private sale of any Vessel or other collateral covered
by any of the Mortgages and execute and deliver an appropriate ▇▇▇▇ of
sale transferring title to such Vessel to a purchaser thereof at such a
private sale;
(c) bid upon or purchase any Vessel at any judicial sale or other
auction, provided that the Agent shall have made funds available in
advance to the Trustee for this purpose; and
(d) operate any Vessel acquired by it as a result of an Enforcement.
Section 8.05. Upon the acquisition of title to any Vessel, as
contemplated by Section 8.04 above, the Trustee shall have no obligation to
protect, conserve or deal with such Vessel, except as so specifically instructed
by the Agent in writing.
Section 8.06. The Agent shall pay all costs and expenses incurred in
connection with any Enforcement, and the Trustee may, in its discretion, require
that the Agent make funds available to the Trustee to satisfy any such cost or
expense prior to the time of incurring such cost or expense.
ARTICLE IX
PAYMENTS TO THE AGENT AND DISTRIBUTIONS
Section 9.01. Provided that the Agent is not in default under this
Trust Agreement with respect to the payment of fees, compensation or other sums,
if any, owed to the Trustee pursuant hereto, the Trustee shall pay, pursuant to
Section 9.02 hereof, to the Agent promptly upon receipt thereof, all sums
collected under the Mortgages or otherwise from the Trust Estate. Such payments
shall be made in immediately available funds to such place as the Agent from
time to time may direct the Trustee.
Section 9.02. Save as expressly stated to the contrary in any
written instructions to the Trustee from the Agent, to the extent that the
Trustee receives or recovers monies pursuant to the Mortgages or any other part
of the Trust Estate (or otherwise) to be applied in discharge of the
Obligations, such monies (after deduction of the costs, expenses and fees of the
Trustee or any receiver, attorney, agent, delegate or other Person appointed by
the Trustee) shall be paid by the Trustee to the Agent for application by the
Agent in accordance with the provisions of Section 6.03 of the Credit Agreement.
Section 9.03. The Trustee shall not be required to segregate its
collections or sums received in payment from its other funds, except as
otherwise by law required or required hereunder, but shall, upon request of the
Agent, furnish to the Agent, a statement and accounting of any monies, or funds
or other things of value (other than the Mortgages) held by it as Trustee
hereunder. The form of such report shall be as mutually agreed by the Trustee
and the Agent.
Section 9.04. In the event the Agent is in default in respect of any
payment to the Trustee of fees or any other sums, if any, owed by the Agent
hereunder, the Trustee shall be allowed to deduct any such fees or amounts from
the Trust Estate before being required to make any payment thereof to the Agent
or any other Person. In the event any such deduction is made, the Trustee shall
promptly furnish the Agent a statement giving complete details of any such
deduction and the basis upon which such deduction is made.
ARTICLE X
COMPENSATION OF THE TRUSTEE
Section 10.01. The Trustee shall receive as compensation for its
services hereunder such fees as may from time to time be agreed upon in writing
among the Obligors, the Agent and the Trustee.
Section 10.02. The compensation provided for in Section 10.01 above
shall be in addition to those costs, expenses and liabilities for which the
Trustee is entitled to be reimbursed or indemnified by the Agent as set forth in
this Trust Agreement.
ARTICLE XI
REMOVAL, DISQUALIFICATION OR RESIGNATION OF
THE TRUSTEE; SUCCESSOR TRUSTEES
Section 11.01. (a) In its discretion, the Agent may remove the
Trustee at any time, without cause, by directing a written notice to the Trustee
of such removal. No removal shall be effective unless a qualified successor
trustee, as described in Section 11.02(e) below, shall have been appointed on or
prior to the effective date of such removal in accordance with the provisions of
this Trust Agreement.
(b) The Trustee may resign at any time without cause by giving at
least thirty (30) days' prior written notice to the Agent, such resignation to
be effective, subject to the provisions of the last sentence of this paragraph,
on the date specified in such notice. If the Agent shall not have appointed a
successor trustee within thirty (30) days after such notice of resignation, the
Trustee may apply to any court of competent jurisdiction to appoint a qualified
successor trustee to act until such time, if any, as a successor trustee shall
have been appointed by the Agent. Any successor trustee so appointed by such
court shall immediately and without further act be superseded by any successor
trustee appointed by the Agent. In any event, however, no resignation shall be
effective until a qualified successor trustee shall have been appointed by the
Agent or a court.
Section 11.02. (a) A successor trustee shall be appointed by an
instrument in writing which shall state the effective date said successor
trustee shall become the Trustee hereunder, which document shall contain the
executed acknowledgment of acceptance by the successor trustee of the trust, the
Trust Estate and the duties of the Trustee as herein provided. The Trustee, the
successor trustee and the Agent shall execute, acknowledge and deliver such
assignments as may be required, in recordable form, and a sufficient number of
counterparts, whereby the successor trustee becomes vested with all of the
estates, properties, rights, remedies and trusts of its predecessor to the trust
hereunder and such instruments shall be duly recorded forthwith in accordance
with the respective laws or statutes governing the Mortgages. The Trustee shall
duly assign, transfer, deliver and pay over to any successor trustee any monies
and other property or things of value subject to the trust hereunder and held by
the Trustee. Should any act or further instrument from the Trustee, the Lenders,
the Issuing Banks, any Secured Hedge Provider, or the Agent be required by any
successor trustee for more fully and certainly vesting in and confirming to such
successor trustee such estates, properties, rights, remedies and trusts, then on
request any and all such acts and instruments shall be done, made, executed,
acknowledged and delivered by the Agent, the Lenders, the Issuing Banks, any
Secured Hedge Provider, and the Trustee.
(b) The Agent shall pay or cause to be paid all recording fees,
transfer taxes, court costs, if applicable, and all other costs arising out of
the transfer of the Trust Estate from the Trustee to a successor trustee.
(c) Upon the removal or resignation of the Trustee, the Trustee's
compensation, if any, shall cease as of the effective date thereof, but its
rights of indemnification shall survive such removal or resignation. Within
thirty (30) days following the effective date of such removal or resignation,
the Trustee shall furnish to the Agent a complete accounting of the Trust Estate
and its compensation, costs and expenses as of the date of removal or
resignation.
(d) Any corporation or other entity into which the Trustee may be
merged or converted or with which it may be consolidated, or any corporation or
other entity resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or other entity to which
substantially all the business of the Trustee may be transferred, shall be the
Trustee under this Trust Agreement without any further act, provided the
successor corporation or other entity remains qualified to act as a trustee.
(e) Any successor to the Trustee, however appointed, shall be a bank
or trust company organized under the laws of the United States or any
jurisdiction thereof having a combined capital and surplus of at least Ten
Billion Dollars ($10,000,000,000), if there be such an institution willing, able
and legally qualified to perform the duties of the Trustee hereunder upon
reasonable or customary terms.
Section 11.03. If at any time: (a) events occur which will or could,
in the opinion of the Agent or the Trustee, result in the disqualification of
the Trustee; or (b) the Trustee becomes disqualified, the Trustee or the Agent,
or both of them, may petition the United States District Court for the Southern
District of New York for instructions to the Trustee in order that the trust may
be preserved to prevent the Agent or the Trustee from falling into violation of
law. To the extent that such may be required or necessary, the parties hereto
agree that said court has jurisdiction for this purpose; however, if in the
interest of justice, the said court determines to transfer the matter to any
other United States Court, the parties hereby agree to the jurisdiction of such
transferee court. Any such petition shall be served upon the other party hereto.
The Trustee, the Agent and any successor trustee hereby agree to abide by the
instructions of the court and to do all acts, execute such agreements and
instruments as may be required in connection therewith and all other instruments
and/or documents necessary to preserve the Trust Estate under the terms
hereunder.
ARTICLE XII
TERMINATION AND DISCHARGE OF TRUST
Section 12.01. This trust is hereby declared to be irrevocable
except that this trust may be terminated by notice given by the Agent to the
Trustee at any time that there is no Mortgage held or to be held as a part of
the Trust Estate and termination of the trust would not create an interest in
the Vessels on the part of the Agent, the Lenders, the Issuing Banks, or any
Secured Hedge Provider that would be contrary to applicable law, or otherwise
cause any of the foregoing to be in violation of any applicable law and all
Obligations under the Credit Documents have been fulfilled. Within thirty (30)
days following the date of such notice, the Trustee shall furnish to the Agent a
complete accounting of the Trust Estate and its
compensation, costs and expenses, if any. This trust shall terminate, cease and
determine upon: (i) the assignment, conveyance and transfer by the Trustee to
the Agent or as the Agent may direct in writing of all property then comprising
the Trust Estate and (ii) the acceptance of such accounting of the Trustee by
the Agent or the relevant transferee.
ARTICLE XIII
AMENDMENT OF TRUST AGREEMENT
Section 13.01. No term or provision of this Trust Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the Agent and the Trustee; and any waiver of the terms hereof
shall be effective only in the specific instance and for the specific purpose
given; provided, however, the trust may not be amended in any way that may vest
or revest in the Agent, the Lenders, the Issuing Banks or any Secured Hedge
Provider any interest in the Vessels contrary to applicable law or that might
adversely affect the enforceability or validity of any Mortgage.
ARTICLE XIV
MISCELLANEOUS
Section 14.01. The headings of the various articles are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
Section 14.02. Any assignment, sale, transfer or other conveyance by
the Trustee of the interest of the Trustee in any of the Mortgages or a Vessel
made pursuant to this Trust Agreement, shall bind the Agent, the Lenders, the
Issuing Banks, or any Secured Hedge Provider and shall be effective to transfer
or convey all right, title and interest of the Trustee, the Agent, the Lenders,
the Issuing Banks, or any Secured Hedge Provider therein. No purchaser or other
grantee shall be required to inquire as to the authorization, necessity,
expediency or regularity of such assignment, sale, transfer or conveyance or as
to the application of any sale or other proceeds with respect thereto by the
Trustee.
Section 14.03. Unless otherwise expressly specified or permitted by
the terms hereof, all notices shall be in writing, delivered or mailed by first
class mail, postage prepaid, (i) if to the Trustee, addressed to the Trustee at
its offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ATTN: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and
(ii) if to the Agent, addressed to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ATTN: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, or such other address as the Trustee or the Agent
may designate by notice to the other. All notices given pursuant to this Section
14.03 shall be effective upon receipt. All notices required to be delivered by
the Trustee under this Trust Agreement shall be delivered promptly by the
Trustee.
Section 14.04. Any provision of this Trust Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 14.05. This Trust Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same instrument.
Section 14.06. All covenants and agreements contained herein shall
be binding upon, and inure to the benefit of, the Trustee, and its successors
and assigns, the Agent, and its successors and assigns, and the Lenders, the
Issuing Banks, and any Secured Hedge Provider, and their respective successors
and assigns. Any request, notice, direction, consent, waiver or other instrument
or action by the Agent shall bind its successors and assigns and the Lenders,
the Issuing Banks, and any Secured Hedge Provider, and their respective
successors and assigns.
Section 14.07. Nothing expressed or implied herein is intended or
shall be construed to confer upon or give to any Person, other than the parties
hereto, their successors or assigns, any right, remedy or claim under or by
reason of this Trust Agreement or of any term, covenant or condition hereof, and
all of the terms, covenants, conditions, promises and agreements contained
herein shall be for the sole and exclusive benefit of the parties hereto and
their successors and assigns.
Section 14.08. THIS TRUST AGREEMENT, AND ALL OF THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER, AND THEIR SUCCESSORS AND ASSIGNS, SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK.
Section 14.09. No provision of this Trust Agreement or any action
taken pursuant hereto shall be considered to be a waiver of the preferred status
of the Mortgages in favor of the Trustee hereunder or in derogation of any of
the benefits, privileges, rights or remedies provided for by applicable law or
the Mortgages.
Section 14.10. This Trust Agreement has been delivered in New York,
New York.
[REMAINDER OF PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto, have caused this Trust
Agreement to be duly executed and delivered in New York, New York by their
respective officers thereunto duly authorized on the day and year first above
written.
CITIBANK, N.A.,
as Agent described in the
Credit Agreement as heretofore mentioned
By______________________________________
Name:
Title:
CITIBANK, N.A.
as Trustee
By______________________________________
Name:
Title:
SCHEDULE I
Description of United States Vessels
NAME OFF. NO. OWNER
---- -------- -----
Pride Arizona (ex-M15) 638626 Pride Offshore, Inc.
Pride Florida (ex-M17) 641802 Pride Offshore, Inc.
Pride Georgia (ex-M16) 638954 Pride Offshore, Inc.
Pride Michigan (ex-M4) 567686 Pride Offshore, Inc.
Pride Missouri (ex-M18) 652045 Pride Offshore, Inc.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Pride Offshore, Inc.
SCHEDULE II
Description of Panama Vessels
NAME CALL SIGN OWNER
---- --------- -----
Pride California ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Kansas HP-9478 Pride Offshore, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇-▇▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride Oklahoma ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Wisconsin (ex-M304) ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Texas HP-9545 Pride Drilling, LLC
Pride Utah HP-8983 Pride Offshore, Inc.
Pride Wyoming HP-8085 Pride Offshore, Inc.
Pride South Pacific (ex-M500) H3IF Pride South Pacific LLC
SCHEDULE III
Description of Vanuatu Vessels
NAME OFF. NO. OWNER
---- -------- -----
Pride Colorado 1521 Pride Drilling, LLC
Pride Hawaii (still-M305) 1027 Pride Offshore International LLC
Pride Mississippi ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Nebraska ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Nevada (ex-M201) ▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride North Dakota (ex-M300) 1455 Pride Offshore International LLC
Pride Rotterdam (ex-306) 1127 Pride Offshore International LLC
Pride South Carolina (ex-M202) ▇▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride Tennessee ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ (ex-M700) ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLC
Pride Alabama 1520 Pride Drilling, LLC
Pride Alaska ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Arkansas 1542 Pride Drilling, LLC
EXHIBIT A
TRUST RECEIPT
Date: _______, 200[ ] Number:_________________
To: Citibank, N.A.,
as Agent
From: Citibank, N.A.,
not in its individual capacity, but solely as Trustee
The Trustee hereby acknowledges the delivery to the Trustee, as
trustee under the Master Vessel and Trust Agreement dated as of [ ] 2004 with
you (the "Trust Agreement"), of the First Preferred Fleet Mortgages dated the
date hereof covering the vessels identified on Schedules I/II/III attached
hereto entered into by the respective owners thereof as set forth in such
Schedule in favor of the Trustee for your benefit on behalf of the Lenders, the
Issuing Banks, and any Secured Hedge Provider.
Terms used herein are used as defined in the Trust Agreement.
CITIBANK, N.A.,
not in its individual capacity, but solely as
Trustee
By _____________________________________
Name:
Title:
SCHEDULE I
Description of United States Vessels
NAME OFF. NO. OWNER
---- -------- -----
Pride Arizona (ex-M15) 638626 Pride Offshore, Inc.
Pride Florida (ex-M17) 641802 Pride Offshore, Inc.
Pride Georgia (ex-M16) 638954 Pride Offshore, Inc.
Pride Michigan (ex-M4) 567686 Pride Offshore, Inc.
Pride Missouri (ex-M18) 652045 Pride Offshore, Inc.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Pride Offshore, Inc.
SCHEDULE II
Description of Panama Vessels
NAME CALL SIGN OWNER
---- --------- -----
Pride California ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Kansas HP-9478 Pride Offshore, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇-▇▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride Oklahoma ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Wisconsin (ex-M304) ▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Texas HP-9545 Pride Drilling, LLC
Pride Utah HP-8983 Pride Offshore, Inc.
Pride Wyoming HP-8085 Pride Offshore, Inc.
Pride South Pacific (ex-M500) H3IF Pride South Pacific LLC
SCHEDULE III
Description of Vanuatu Vessels
NAME OFF. NO. OWNER
---- -------- -----
Pride Colorado 1521 Pride Drilling, LLC
Pride Hawaii (still-M305) 1027 Pride Offshore International LLC
Pride Mississippi ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Nebraska ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Nevada (ex-M201) ▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride North Dakota (ex-M300) 1455 Pride Offshore International LLC
Pride Rotterdam (ex-306) 1127 Pride Offshore International LLC
Pride South Carolina (ex-M202) ▇▇▇▇ ▇▇▇▇▇▇ Drilling Limited LLC
Pride Tennessee ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ (ex-M700) ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLC
Pride Alabama 1520 Pride Drilling LLC
Pride Alaska ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLC
Pride Arkansas 1542 Pride Drilling, LLC
EXHIBIT Q
JOINDER TO CREDIT AGREEMENT
IN WITNESS WHEREOF, the undersigned (the "Additional Guarantor") hereby
agrees that effective from and after the date set forth below, it shall be
deemed to be a "Guarantor" under and to be bound by all of the terms and
provisions set forth in that certain Credit Agreement dated July 7, 2004 between
Pride Offshore, Inc., a Delaware corporation, the Lenders and Guarantors parties
thereto from time to time, other parties and Citicorp North America, Inc., as
Administrative Agent (in such capacity, the "Administrative Agent") (as the same
may be amended, modified and supplemented from time to time, the "Credit
Agreement"). This signature page shall be deemed a counterpart signature page to
the Credit Agreement and the undersigned hereby authorizes the Administrative
Agent to attach this signature page thereto.
Executed as of the _________ day of ______________, 200__.
ADDITIONAL GUARANTOR:
By:________________________________
Name:______________________________
Title:_____________________________