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EXHIBIT 10.32
FIFTH AMENDMENT
FIFTH AMENDMENT, dated as of June 16, 1998 (this "Fifth Amendment"),
to the Credit Agreement, dated as of September 30, 1996 (as amended by the
Global Amendment and Assignment and Acceptance, dated as of October 9, 1996,
the Second Amendment, dated as of April 23, 1997, the Third Amendment dated as
of May 13, 1997, the Fourth Amendment dated as of June 15, 1997, and as may be
further amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among RIGCO NORTH AMERICA, L.L.C., a Delaware limited
liability company (the "Borrower"), the several banks and other financial
institutions from time to time parties thereto (the "Lenders"), ▇▇▇▇▇▇
COMMERCIAL PAPER INC. ("LCPI"), as Advisor, Syndication Agent and Arranger,
HIBERNIA NATIONAL BANK, as Collateral and Documentation Agent and BHF-BANK
AKTIENGESELLSCHAFT, as Administrative Agent.
W I T N E S S E T H
WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to
make, and have made, certain Loans to the Borrower;
WHEREAS, DeepTech and El Paso Natural Gas Company ("El Paso") have
entered into an Agreement and Plan of Merger dated February 27, 1998 (the
"Merger Agreement") and DeepTech, El Paso and certain of their affiliates have
entered, or will enter, into certain additional agreements (along with the
Merger Agreement, the "Reorganization Documents") pursuant to which (i) DPSI
and its Subsidiaries will become Subsidiaries of ▇▇▇▇▇▇ Offshore, Inc. ("TOFF")
as a result of DeepTech's contribution to TOFF of 100% of the Capital Stock of
DPSI and all of the then remaining indebtedness owed from DPSI to DeepTech (the
"Contribution"), (ii) the tax basis in the Pincay will be "stepped-up" by up to
$48 million in the Step-Up Transactions (as hereinafter defined), (iii)
DeepTech will spin-off TOFF pursuant to a rights offering (the "Rights
Offering") to the DeepTech stockholders (the "Spin-Off"), (iv) El Paso will
acquire DeepTech pursuant to a merger (the "Merger") and (v) the Management
Agreement may be amended and assigned to TOFF or terminated and replaced
(hereinafter, the transactions described in or contemplated by this recital or
the Reorganization Documents may be referred to as the "Reorganization
Transactions");
WHEREAS, the Lenders' consent is required with respect to certain
aspects of the Reorganization Transactions, including, without limitation,
DeepTech no longer being affiliated with the Borrower and the Borrower
transferring certain of its assets to an affiliate in connection with the
Step-Up Transactions;
WHEREAS, the Borrower desires to effect the Reorganization
Transactions while maintaining the existence of the Credit Agreement;
WHEREAS, the Borrower has requested that the Lenders amend, and the
Lenders have agreed to amend, certain of the provisions of the Credit
Agreement, upon the terms and subject to the conditions set forth below;
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NOW, THEREFORE, the parties hereto agree as follows:
1. DEFINED TERMS. As used herein, terms defined in this Fifth
Amendment or in the Credit Agreement are used herein as so defined.
2. AMENDMENT TO SUBSECTION 1.1 (DEFINED TERMS). Subsection 1.1 of
the Credit Agreement is hereby amended as follows:
(i) adding the following definitions:.
"First Amendment to Deed of Covenants": the First
Amendment to Deed of Covenants dated as of even date
with the First Amendment to Ship Mortgage between the
Borrower and the Collateral and Documentation Agent.
"First Amendment to Ship Mortgage": the First
Amendment to Ship Mortgage and related First
Amendment to Deed of Covenants dated as of even date
with the Fifth Amendment issued by the Borrower in
favor of the Collateral and Documentation Agent, as
the same may be modified from time to time, granting
a mortgage on the Borrower's 25% undivided interest
in the Pincay to secure the Borrower's obligations
under this Agreement, which Ship Mortgage and Deed of
Covenants shall be substantially in the form of the
Ship Mortgage and related Deed of Covenants initially
executed by the Borrower granting a mortgage on the
Pincay.
"Fifth Amendment": the Fifth Amendment, dated as of
June 16, 1998, to this Agreement.
"First Amendment to Parent Pledge Agreement": the
First Amendment to Parent Pledge Agreement dated as
of even date with the Fifth Amendment executed and
delivered by FPS V in favor of the Lenders.
"FPS V/FPS VI Guarantee": the Guarantee dated as of
even date with the Fifth Amendment issued by FPS V
and FPS VI in favor of the Lenders.
"FPS V Acquisition, Assignment and Assumption
Agreement": the Acquisition, Assignment and
Assumption dated as of even date with the Fifth
Amendment between FPS V and the Borrower.
"FPS V Purchase Note": the Promissory Note dated as
of even date with the Fifth Amendment issued by FPS V
in favor of the Borrower in the original principal
amount of $15 million.
"FPS VI": FPS VI, L.L.C., a Delaware limited
liability company formed and initially owned by the
Borrower.
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"FPS VI Contribution and Assumption Agreement": the
Contribution and Assumption Agreement dated as of
even date with the Fifth Amendment between FPS VI and
the Borrower.
"FPS VI Deed of Covenants": the Deed of Covenants
dated as of even date with the FPS VI Ship Mortgage
between FPS VI and the Collateral and Documentation
Agent.
"FPS VI Security Agreement": the Security Agreement
dated as of even date with the Fifth Amendment issued
by FPS VI in favor of the Collateral and
Documentation Agent.
"FPS VI Ship Mortgage": the Ship Mortgage and related
Deed of Covenants dated as of even date with the
Fifth Amendment issued by FPS VI in favor of the
Collateral and Documentation Agent, as the same may
be modified from time to time, granting a mortgage on
FPS VI's 75% undivided interest in the Pincay to
secure FPS VI's obligations under the FPS V/FPS VI
Guarantee, which Ship Mortgage and Deed of Covenants
shall be substantially in the form of the Ship
Mortgage and related Deed of Covenants initially
executed by the Borrower granting a mortgage on the
Pincay.
"Merger Agreement": as defined in the recitals to
the Fifth Amendment.
"Pincay Assets and Liabilities": the assets and
liabilities which will be transferred from the
Borrower to (i) FPS VI in connection with the Step-Up
Transactions, including, without limitation, a 75%
undivided interest in the Pincay and related
equipment and 75% of the Borrower's rights, title and
interest in, and obligations with respect to, the
related equipment, and any agreements, documents or
instruments related to any of the foregoing, and (ii)
FPS V in connection with the Step-Up Transactions,
including, without limitation, the Capital Stock of
FPS VI, $42,281,250 of the PIK Note, the FPS V
Purchase Note and any agreements, documents or
instruments related to the foregoing.
"PIK Note": The Subordinated Promissory Note dated
September 30, 1996 issued by the Borrower, as maker,
in favor of DPSI, as lender, in the original
principal amount of $40,055,853.
"Reorganization Documents": as defined in the
recitals to the Fifth Amendment.
"Reorganization Transactions": as defined in the
recitals to the Fifth Amendment.
"Rights Offering": as defined in the recitals to the
Fifth Amendment.
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"Step-Up Transactions": the series of transactions
pursuant to which (i) the Pincay Assets and
Liabilities will be transferred from the Borrower to
FPS V and FPS VI, (ii) FPS V will give $57,281,250 in
consideration to the Borrower in the form of the
assumption of $42,281,250 of the PIK Note and the
issuance of the FPS V Purchase Note, and (iii) all of
the Capital Stock of FPS VI will be transferred to
FPS V.
"Step-Up Transactions Loan Documents": the FPS V/FPS
VI Guarantee, FPS VI Security Agreement, First
Amendment to Parent Pledge Agreement, FPS VI Ship
Mortgage, FPS VI Deed of Covenants, First Amendment
to Ship Mortgage and First Amendment to Deed of
Covenants.
"TOFF": as defined in the recitals to the Fifth
Amendment.
(ii) amending the definition of the term "Asset Sale" by adding
at the end thereof, after the phrase "Subsidiary of the Borrower" and
before the period, the phrase, "or FPS VI, except for any sale, lease,
sale-leaseback, assignment or other disposition made as a part of the
Step-Up Transactions.
(iii) amending the definition of the term "Change of Control"
by deleting subpart (a) of such definition and substituting in lieu thereof
the following:
(a) other than pursuant to the Rights Offering, the
acquisition by any Person or two or more Persons
acting in concert (other than the management of TOFF
as of date hereof or of the closing date of the Rights
Offering) of beneficial ownership (within the meaning
of Rule 13d-3, promulgated by the Securities and
Exchange Commission and now in effect under the
Securities Exchange Act of 1934, as amended) of 50% or
more of the issued and outstanding shares of voting
stock of TOFF;
(iv) further amending the definition of the term "Change of
Control" by deleting the term "DeepTech" each time it appears therein and
substituting in lieu thereof the term, "TOFF".
(v) amending the definition of the term "Deed of Covenants" by
adding the phrase "or, as applicable, FPS VI" after the word "Borrower".
(vi) amending the definition of the term "Excess Cash Flow" by,
with respect to the items (i)-(iv) added to Net Income to arrive at Excess
Cash Flow, deleting the word "and" before "(iv)", and at the end of the
phrase contained in "(iv)" adding the following phrase:
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and (v) amounts payable to the Borrower pursuant to the
FPS V Purchase Note.
(vii) amending the definition of the term "Loan Documents" to
include the Step-Up Transactions Loan Documents.
(viii) amending the definition of the term "Loan Parties" to
include FPS VI.
(ix) amending the definition of the term "Management Agreement"
by adding at the end thereof, after the term "hereof" and before the period,
the phrase, ", as such agreement may be amended or replaced in connection
with the Reorganization Transactions to reflect that TOFF or one of its
Affiliates, and not DeepTech, will be providing the services provided for
therein".
(x) amending the definition of the term "Permitted Issuances" by
deleting the word "and" before "(iii)" and adding the following phrase to
the end of such definition: ", and (iv) the issuance of Capital Stock by
FPS VI in exchange for the contribution of an interest in the Pincay in
connection with the formation thereof.
(xi) amending the definition of "Pincay" by replacing the term
"Mortgage" each time it appears therein with the term "Mortgages".
(xii) amending the definition of "Ship Mortgages" to, first,
add after "(ii)" and before the word "the" the following phrase:
", as applicable, either (a)"
and, second, to add the following phrase immediately before
the period:
"or (b) the FPS VI Ship Mortgage."
3. AMENDMENT TO SUBSECTION 2.5 (MANDATORY PREPAYMENT).
Subsection (a) of Subsection 2.5 of the Credit Agreement is hereby amended by
adding after the phrase "any of its Subsidiaries" and before the word "shall,"
the phrase "or FPS VI."
Subsection (b) of Subsection 2.5 of the Credit Agreement is hereby amended by
adding after the phrase "any of its Restricted Subsidiaries" and before the word
"shall," the phrase "or FPS VI."
4. AMENDMENT TO SUBSECTION 3.13 (ERISA). Subsection 3.13 of the
Credit Agreement is hereby amended by deleting the term "DeepTech" therefrom
and substituting in lieu thereof, the term "TOFF".
5. AMENDMENT TO SUBSECTION 3.19 (MAJORITY-OWNED SUBSIDIARY).
Subsection 3.19 of the Credit Agreement is hereby amended by deleting the term
"DeepTech" therefrom and substituting in lieu thereof, the term "TOFF".
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6. AMENDMENT TO SUBSECTION 6.1 (FINANCIAL CONDITION COVENANTS).
Subsection 6.1 of the Credit Agreement is hereby amended by adding the
following sentence at the end thereof: "For purposes of the financial
condition covenants in this subsection 6.1, the financial condition and results
of FPS VI shall be deemed to be included with the Borrower's financial
condition and results."
7. AMENDMENT TO SUBSECTION 6.5 (LIMITATION OF FUNDAMENTAL
CHANGES). Subsection 6.5 of the Credit Agreement is hereby amended by adding
after the phrase "method of conducting business" and before the period, the
phrase ", except in connection with the Step-Up Transactions".
8. AMENDMENT TO SUBSECTION 6.6 (LIMITATION OF SALE OF ASSETS).
Subsection 6.6 of the Credit Agreement is hereby amended by adding after the
term "Subsidiary" and before the comma immediately thereafter in the second
line thereof the phrase, "and except in connection with the Step-Up
Transactions".
9. AMENDMENT TO SUBSECTION 6.9 (LIMITATION ON INVESTMENTS, LOANS
AND ADVANCES). Subsection 6.9 of the Credit Agreement is hereby amended by
adding after the parenthetical "(all of which shall be funded with the proceeds
of Permitted Issuances)" and before the period, the following:
"; and
(d) in connection with the Step-Up Transactions".
10. AMENDMENT TO SUBSECTION 6.10 (LIMITATION OF OPTIONAL PAYMENTS
AND MODIFICATIONS OF DEBT INSTRUMENTS). Subsection 6.10 of the Credit
Agreement is hereby amended by (a) adding at the beginning thereof, before the
phrase "Make any optional payment", the phrase, "Except in connection with the
Step-Up Transactions" and (b) adding at the end thereof the following new
paragraph (c):
"or (c) amend, modify or change or consent or agree to any
amendment, modification or change to any of the terms of the
FPS V Purchase Note."
11. AMENDMENT TO SUBSECTION 6.11 (LIMITATION ON TRANSACTIONS WITH
AFFILIATES). Subsection 6.11 of the Credit Agreement is hereby amended by
adding to the third line thereof, after the phrase, "such transaction is" and
before the subparagraph "(a)", the phrase, "(i) in connection with or a part of
the Step-Up Transactions, or (ii)".
12. AMENDMENT TO SUBSECTION 6.16 (OTHER MODIFICATIONS).
Subsection 6.16 of the Credit Agreement is hereby amended by beginning such
Subsection with the phrase "Except to the extent done in connection with the
Reorganization Transactions,".
13. AMENDMENT TO SECTION 7 (EVENTS OF DEFAULT). Subsection (c) of
Section 7 of the Credit Agreement is hereby amended by deleting the word
"either" after the "(ii)" and replacing it with the word "any" and adding to
the end thereof the following phrase:
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"or (iii) Sections 4.4, 5.5, or 6.4 of the FPS VI Security
Agreement or Section 10 of the FPS V/FPS VI Guarantee".
Subsections (e) and (f) of Section 7 of the Credit Agreement are hereby amended
by deleting therefrom the term "DeepTech" each time it appears therein and
substituting in lieu thereof the term "TOFF".
Subsection (f) of Section 7 of the Credit Agreement is hereby amended by adding
the words "or FPS VI" after the words "or any Pledgor" each time they appear
therein.
Section 7 of the Credit Agreement is hereby amended by adding a
"Subsection (m)" that reads as follows:
"The FPS V/FPS VI Guarantee shall cease, for any reason to be
in full force and effect, or FPS V or FPS VI shall so assert."
14. AMENDMENT TO SUBSECTION 9.2 (NOTICES). Subsection 9.2 of the
Credit Agreement is hereby amended by deleting the first and second lines in
the address for the Borrower or any of its Subsidiaries set forth therein and
replacing such lines with, "c/▇ ▇▇▇▇▇▇ Offshore, Inc., 7400 Chase Tower".
15. CONSENT. The Lenders hereby consent to the Reorganization
Transactions and waive any Default or Event of Default occurring or otherwise
existing within seven days after the Effective Date that might arise under the
Credit Agreement or any other Loan Document as a result of the execution and
delivery of the Reorganization Documents or the performance of the obligations
thereunder or the consummation of the Reorganization Transactions.
16. EFFECTIVENESS. The amendments provided for herein shall
become effective on the date (the "Effective Date") of satisfaction of the
following conditions precedent:
(a) The Administrative Agent shall have received
counterparts of this Fifth Amendment, duly executed and delivered by
the Borrower and each of the other parties hereto.
(b) The Administrative Agent shall have received the
executed legal opinion of Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, counsel
to the Borrower in form and substance satisfactory to the
Administrative Agent in its reasonable discretion.
(c) The Administrative Agent shall have received the
executed legal opinion of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Co., Nassau, special
counsel to the Administrative Agent with respect to matters of
Bahamian law.
(d) The execution and delivery of the Step-Up Transactions
Loan Documents.
17. REPRESENTATIONS AND WARRANTIES. After giving effect to the
amendments, terms and provisions contained herein, on the Effective Date, the
Borrower hereby confirms, reaffirms and restates the representations and
warranties set forth in Section 3 of the Credit
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Agreement; provided (i) that each reference in Section 3 to "this Agreement"
shall be deemed to be a reference both to this Fifth Amendment and to the
Credit Agreement as amended by this Fifth Amendment, (ii) that representations
and warranties contained in such Section 3 stated to refer to a specific
earlier date shall be true and correct in all material respects as of such
earlier date, (iii) that such confirmation, reaffirmation and restatement shall
include disclosures made by the Borrower prior to the Effective Date as if such
disclosures were (and such disclosures are hereby incorporated as if) set forth
fully herein, and (iv) with respect to the representations and warranties set
forth in Subsection 3.2 ("No Change"), the relevant reference date shall be
changed from September 30, 1996 to June 30, 1997. The Borrower represents and
warrants that this Amendment, TOFF's Form S-1 and El Paso Natural Gas Company's
Form S-4, each filed with the Securities and Exchange Commission on April 10,
1998, and the other disclosures made to LCPI and the legal counsel of the
Lenders describe the material aspects of the Reorganization Transactions.
18. CONTINUING EFFECT; NO OTHER AMENDMENTS. Except as expressly
amended or waived hereby or as required to be consistent with the provisions
hereof, all of the terms and provisions of the Credit Agreement and the other
Loan Documents are and shall remain in full force and effect. Except as
expressly provided herein or required to be consistent with the provisions
hereof, the amendments contained herein shall not constitute an amendment or
waiver of any other provision of the Credit Agreement or the other Loan
Documents or for any purpose except as expressly set forth herein.
19. COSTS AND EXPENSES. The Borrower agrees to pay the reasonable
costs and expenses of the Administrative Agent, the Collateral and
Documentation Agent and the Arranger in connection with this Fifth Amendment,
including without limitation, legal fees and expenses.
20. COUNTERPARTS. This Fifth Amendment may be executed in any
number of counterparts by the parties hereto, each of which counterparts when
so executed shall be an original, but all the counterparts shall together
constitute one and the same instrument.
21. GOVERNING LAW. THIS FIFTH AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
[REMAINDER OF PAGE INTENTIONALLY BLANK.]
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IN WITNESS WHEREOF, the parties have caused this Fifth Amendment to be
duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.
RIGCO NORTH AMERICA, L.L.C.
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Senior Vice President
BHF-BANK AKTIENGESELLSCHAFT, as
Administrative Agent and as a Lender
By:
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Title:
By:
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Title:
HIBERNIA NATIONAL BANK, as Collateral
and Documentation Agent and as a Lender
By:
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Title:
▇▇▇▇▇▇ COMMERCIAL PAPER INC., as
Syndication Agent and as a Lender
By:
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Title:
▇▇▇ ▇▇▇▇▇▇ AMERICAN CAPITAL
PRIME RATE INCOME TRUST
By:
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Title:
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▇▇▇▇▇▇▇ ▇▇▇▇▇ PRIME RATE PORTFOLIO
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ASSET MANAGEMENT,
L.P., as Investment Adviser
By:
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Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING RATE
FUND, INC.
By:
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Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ DEBT STRATEGIES
PORTFOLIO
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ ASSET MANAGEMENT,
L.P., as Investment Adviser
By:
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Title:
ML SENIOR HIGH INCOME PORTFOLIO, INC.
By:
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Title:
ML CBO IV (CAYMAN) LTD.
By: PROTECTIVE ASSET MANAGEMENT, L.L.C.,
as Collateral Manager
By:
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Title:
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PAMCO CAYMAN LTD.
By:
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Title:
THE TORONTO-DOMINION BANK
By:
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Title: