EXHIBIT 10.19
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ASSET PURCHASE AGREEMENT
by and between
Noble Drilling Corporation,
Noble Drilling (U.S.) Inc.,
Noble Offshore Corporation,
Noble Drilling (Mexico) Inc. and
NN-1 Limited Partnership
and
Pride Petroleum Services, Inc.
February 19, 1997
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TABLE OF CONTENTS
Page
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PARTIES.................................................................... 1
RECITALS................................................................... 1
ARTICLE I -- CERTAIN DEFINITIONS..................................... 1
ARTICLE II -- PURCHASE AND SALE OF ASSETS............................ 4
2.1 Assets to be Purchased................................... 4
2.2 Excluded Assets.......................................... 5
2.3 Assumed Liabilities...................................... 5
2.4 Limitation on Assignments................................ 6
2.5 Delivery of Records...................................... 6
ARTICLE III -- PURCHASE PRICE........................................ 7
3.1 Consideration for the Purchased Assets................... 7
3.2 Buyer's Default.......................................... 7
3.3 Return of Deposit........................................ 8
3.4 Allocation of Purchase Price............................. 8
ARTICLE IV -- THE CLOSING............................................ 8
4.1 Time and Place of Closing................................ 8
4.2 Deliveries by Parent and Sellers......................... 8
4.3 Deliveries by Buyer...................................... 9
ARTICLE V -- REPRESENTATIONS AND WARRANTIES OF SELLERS............... 9
5.1 Organization and Existence............................... 9
5.2 Authority; Etc........................................... 9
5.3 No Violations............................................ 10
5.4 Ownership of Rigs........................................ 10
5.5 Inventory................................................ 11
5.6 Contracts................................................ 11
5.7 Litigation............................................... 11
5.8 Governmental Approval.................................... 12
5.9 Compliance With Laws..................................... 12
5.10 Reserved................................................. 12
5.11 Rig Classifications and Certifications................... 12
5.12 Environmental Matters.................................... 12
5.13 No Brokers............................................... 13
5.14 Decrees, etc............................................. 13
5.15 Performance Bonds; Letters of Credit..................... 13
ARTICLE VI -- REPRESENTATIONS AND WARRANTIES OF PARENT............... 13
6.1 Organization and Existence............................... 13
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6.2 Authority; Etc........................................... 14
6.3 No Violations............................................ 14
6.4 Governmental Approval.................................... 14
6.5 Litigation............................................... 15
6.6 No Brokers............................................... 15
6.7 Employees and Related Matters............................ 15
ARTICLE VII -- REPRESENTATIONS AND WARRANTIES OF BUYER............... 15
7.1 Organization and Existence............................... 15
7.2 Authority; Etc........................................... 15
7.3 No Violations............................................ 16
7.4 Inspections.............................................. 16
7.5 Litigation............................................... 16
7.6 Governmental Approval.................................... 17
7.7 No Brokers............................................... 17
7.8 Certain Knowledge Regarding Assignment of Contracts...... 17
7.9 Registration Statement................................... 17
ARTICLE VIII -- CONDITIONS TO THE OBLIGATIONS OF
PARENT AND SELLERS........................................ 17
8.1 Accuracy of Representations and Warranties............... 17
8.2 Covenants and Agreements Performed....................... 17
8.3 Officer's Certificate.................................... 17
8.4 Legal Opinion............................................ 18
8.5 HSR Act.................................................. 18
ARTICLE IX -- CONDITIONS TO THE OBLIGATIONS OF BUYER................. 18
9.1 Accuracy of Representations and Warranties............... 18
9.2 Covenants and Agreements Performed....................... 18
9.3 Officer's Certificate.................................... 18
9.4 Legal Opinion............................................ 19
9.5 HSR Act.................................................. 19
9.6 Financing by Buyer....................................... 19
ARTICLE X -- COVENANTS AND AGREEMENTS OF THE PARTIES BEFORE,
RELATING TO AND SUBSEQUENT TO THE CLOSING.................... 19
10.1 Expenses................................................. 19
10.2 HSR Act Compliance....................................... 19
10.3 Access................................................... 19
10.4 Conduct of Business and Preservation of Assets........... 20
10.5 Transition of Business Operations........................ 20
10.6 Litigation............................................... 20
10.7 Certain Taxes............................................ 21
10.8 Actions with Respect to Closing.......................... 21
10.9 Public Statements........................................ 21
10.10 Books and Records........................................ 21
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10.11 Rig Loss................................................. 22
10.12 Use of Names............................................. 22
10.13 Continued Effectiveness of Representations and Warranties 22
10.14 Post-Closing Collection, Payment and Administrative
Procedures .............................................. 22
10.15 Action of Buyer Regarding Financing...................... 23
10.16 Certain Financial Statements............................. 23
10.17 Import Duties; Performance Bonds......................... 23
10.18 Availability of Rigs to Triton Engineering Services
Company.................................................. 24
10.19 Acquisition Proposal..................................... 24
ARTICLE XI -- EMPLOYEES.............................................. 25
11.1 Employees................................................ 25
11.2 Non-Solicitation of Certain Employees.................... 26
ARTICLE XII -- TERMINATION........................................... 26
12.1 Termination.............................................. 26
12.2 Effect of Termination.................................... 27
ARTICLE XIII -- EXTENT AND SURVIVAL OF REPRESENTATIONS,
WARRANTIES, COVENANTS AND AGREEMENTS...................... 28
13.1 Scope of Representations of Sellers...................... 28
13.2 Indemnification by Parent................................ 28
13.3 Indemnification by Buyer................................. 29
13.4 Indemnification Procedure................................ 29
13.5 Survival................................................. 30
13.6 Tax Benefits; Insurance Proceeds......................... 30
13.7 Applicability of Indemnification Obligation.............. 30
ARTICLE XIV -- PARENT GUARANTEE...................................... 30
ARTICLE XV -- MISCELLANEOUS.......................................... 31
15.1 Notices.................................................. 31
15.2 Entire Agreement......................................... 32
15.3 Amendments and Waiver; Rights and Remedies............... 32
15.4 Governing Law............................................ 32
15.5 Binding Effect; Assignment............................... 32
15.6 Counterparts............................................. 33
15.7 References............................................... 33
15.8 Severability of Provisions............................... 33
15.9 Gender................................................... 33
15.10 Descriptive Headings..................................... 33
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ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement"), dated as of February 19,
1997, is by and between Pride Petroleum Services, Inc., a Louisiana corporation
("Buyer"), and Noble Drilling Corporation, a Delaware corporation ("Parent"),
Noble Drilling (U.S.) Inc., a Delaware corporation ("NDUS"), Noble Offshore
Corporation, a Delaware corporation ("NOC"), Noble Drilling (Mexico) Inc., a
Delaware corporation ("NDMEX"), and NN-1 Limited Partnership, a Texas limited
partnership ("NN-1") (NDUS, NOC, NDMEX and NN-1 are sometimes referred to
herein, collectively, as "Sellers" and, individually, as a "Seller");
W I T N E S S E T H:
WHEREAS, Buyer desires to purchase the Purchased Assets (as hereinafter
defined) from Sellers; and
WHEREAS, Sellers desire to sell the Purchased Assets to Buyer in exchange
for the payment by Buyer of the Purchase Price (as hereinafter defined) and the
assumption by Buyer of the Assumed Liabilities (as hereinafter defined); and
WHEREAS, Parent desires to take such actions as are necessary or
appropriate to cause Sellers to effect the transactions above described in this
preamble and, in connection therewith, to guarantee the agreements and
obligations of Sellers in and under this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual terms,
covenants and conditions herein contained, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used in this Agreement, the following terms have the following
respective meanings:
"Acquisition Proposal" has the meaning specified in Section 10.19.
"Affiliate" means, as to the person specified, any person controlling,
controlled by or under common control with such person, with the concept of
control in such context meaning the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of
another, whether through the ownership of voting securities, by contract or
otherwise.
"Agreement" has the meaning specified in the preamble.
"Applicable Environmental Laws" has the meaning specified in Section
5.12(b).
"Applicable Laws" has the meaning specified in Section 5.9.
"Assumed Liabilities" has the meaning specified in Section 2.3.
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"Best Efforts" means a party's best efforts in accordance with reasonable
commercial practice and without the incurrence of unreasonable expense.
"Business Day" means a day on which national banks are generally open for
the transaction of business in Houston, Texas.
"Buyer" has the meaning specified in the preamble.
"Buyer Basket" has the meaning specified in Section 13.2.
"Buyer Designee" has the meaning specified in Section 15.5(b)(ii).
"Claims" has the meaning specified in Section 13.2.
"Closing" means the consummation of the transactions contemplated by
Article II of this Agreement in accordance with the terms and upon the
conditions set forth in Article II.
"Closing Date" has the meaning specified in Section 4.1.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consent Required Contract" has the meaning specified in Section 2.4.
"Deposit" has the meaning specified in Section 3.1(a).
"Drilling Contracts" has the meaning specified in Section 2.1(e)(i).
"Employer" and "Employers" have the meanings specified in Section 11.1(c).
"Employment Arrangements" has the meaning specified in Section 11.1(d).
"Encumbrances" means liens, charges, pledges, options, mortgages, security
interests, claims, title defects and other encumbrances of every type and
description, whether imposed by law, agreement, understanding or otherwise.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" has the meaning specified in Section 6.7.
"Escrow Agent" has the meaning specified in Section 3.1(a).
"Escrow Agreement" has the meaning specified in Section 3.1(a).
"Escrow Funds" has the meaning specified in Section 3.1(a).
"Excluded Assets" has the meaning specified in Section 2.2.
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"General Assignment" has the meaning specified in Section 4.2(a).
"Governmental Entity" means any court or tribunal in any jurisdiction
(domestic or foreign) or any public, governmental or regulatory body, agency,
department, commission, board, bureau or other authority or instrumentality
(domestic or foreign).
"hazardous material" has the meaning specified in Section 5.12(b).
"HSR Act" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976,
as amended, and the rules and regulations promulgated thereunder.
"Indemnified Party" has the meaning specified in Section 13.4.
"Indemnifying Party" has the meaning specified in Section 13.4.
"Inventory" has the meaning specified in Section 2.1(c).
"NDMEX" has the meaning specified in the preamble.
"NDUS" has the meaning specified in the preamble.
"NN-1" has the meaning specified in the preamble.
"NN-1 Partner's Consent" has the meaning specified in Section 5.2.
"NOC" has the meaning specified in the preamble.
"Nonassigned Contract" has the meaning specified in Section 2.4.
"Other Contracts" has the meaning specified in Section 2.1(e)(ii).
"Parent" has the meaning specified in the preamble.
"PEMEX Contracts" has the meaning specified in Section 10.18(a).
"Permits" has the meaning specified in Section 2.1(d)(ii).
"Permitted Encumbrances" means (i) Encumbrances for taxes, assessments and
governmental charges not yet due and payable or the validity of which are being
contested in good faith by appropriate proceedings; (ii) statutory liens arising
in the ordinary course of business relating to obligations as to which there is
no default on the part of Parent or Sellers, excluding any mortgage; (iii) the
Drilling Contracts and Other Contracts; (iv) outstanding recommendations to
class against any of the Rigs; and (v) any other Encumbrances which in the
aggregate do not exceed $200,000; provided, however, that at the Closing
"Permitted Encumbrances" shall not include any Encumbrances for taxes,
assessments or governmental charges filed of record against the Purchased
Assets, or statutory liens filed of record against
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the Purchased Assets, unless any such Encumbrances are being diligently
contested in good faith by appropriate proceedings.
"Proceedings" means all proceedings, actions, claims, suits,
investigations and inquiries by or before any arbitrator or Governmental Entity.
"Purchased Assets" has the meaning specified in Section 2.1.
"Purchase Price" shall mean $265,000,000.
"Registration Statement" has the meaning specified in Section 7.9.
"Retained Employees" has the meaning specified in Section 11.1(b).
"▇▇▇▇▇▇▇▇▇▇ Hull" has the meaning specified in Section 2.1(b).
"Rigs" has the meaning specified in Section 2.1(b).
"Securities Act" has the meaning specified in Section 7.9.
"Seller Basket" has the meaning specified in Section 13.3.
"Seller Designee" has the meaning specified in Section 15.5(b)(i).
"Seller" and "Sellers" have the meanings specified in the preamble.
"Taxes" has the meaning specified in Section 10.7.
"Triton" has the meaning specified in Section 10.18(a).
"Triton Contracts" has the meaning specified in Section 10.18(a).
ARTICLE II
PURCHASE AND SALE OF ASSETS
2.1 ASSETS TO BE PURCHASED. Upon the terms and subject to the conditions
set forth in this Agreement, at the Closing, Sellers agree to sell, assign,
transfer, deliver and convey to Buyer, and Buyer agrees to purchase, the
following (collectively, the "Purchased Assets"):
(a) the 12 mat supported jackup drilling rigs described on Schedule
2.1(a), of which the ▇▇▇▇▇ ▇▇▇▇▇▇ is "cold-stacked";
(b) the hull from the former mat supported jackup drilling rig, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, which has become a constructive total loss and no longer has any
drilling machinery or other equipment onboard or associated therewith (the
"▇▇▇▇▇▇▇▇▇▇ Hull", and, together with the mat supported jackup drilling rigs
described in Section 2.1(a), collectively referred to herein as the "Rigs");
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(c) the stocks owned by Sellers or any of their Affiliates described on
Schedule 2.1(c) (collectively, "Inventory"), as such Inventory may be reduced
through consumption thereof, or increased through replacement thereof or
addition thereto, in the ordinary course of the maintenance and operation of the
Rigs through the Closing Date;
(d) the following tangible and intangible assets used or held for use in
connection with the ownership, maintenance and operation of the Rigs, to the
extent assignable by law and Sellers or their Affiliates have the right to
assign and transfer such assets:
(i) all records to be delivered to Buyer pursuant to Section 2.5;
and
(ii) the certificates, licenses, permits, consents, operating
authorities, orders, exemptions, franchises, approvals, registrations and
other authorizations and applications therefor specifically associated
with the maintenance and operation of a Rig and listed on Schedule
2.1(d)(ii) hereto ("Permits"); and
(e) the benefit and burden subsequent to the Closing Date of:
(i) all drilling contracts and any amendments thereto for the
employment of the Rigs in effect on the Closing Date (the "Drilling
Contracts"), including without limitation the Drilling Contracts
identified on Schedule 2.1(e)(i) hereto in effect on the Closing Date; and
(ii) all other contracts to which Sellers or any of their Affiliates
is a party relating to the ownership, maintenance and operation of the
Rigs in effect on the Closing Date and described on Schedule 2.1(e)(ii)
(the "Other Contracts").
2.2 EXCLUDED ASSETS. The Purchased Assets to be transferred by Sellers to
Buyer hereunder shall include only those described or referred to in Section
2.1, and no other assets or properties of Sellers shall be transferred to Buyer
hereunder. Without limiting the generality of the preceding sentence, the
Purchased Assets shall not include (i) Parent's subsidiaries, (ii) cash,
accounts receivable, prepaid expenses and deposits, (iii) the blowout preventer
(and related BOP handling equipment) currently installed on the NN-1, it being
understood that the blowout preventer shown on Schedule 2.1(a) for the NN-1 will
be installed therefor, (iv) equipment and stores owned by third-party suppliers
(such as catering consumables, cement units or logging equipment) or (v) claims
and rights under contracts not assigned to and assumed by Buyer hereunder and,
in the case of contracts that are assigned to and assumed by Buyer, claims and
rights thereunder to the extent, but only to the extent, that such claims and
rights relate to the ownership or operation of the Purchased Assets prior to the
Closing, including, without limitation, claims for reimbursements, day, footage
or turnkey rates, lost equipment, indemnity or escalation of fees that relate to
periods prior to the Closing Date, whether or not billed on or before the
Closing Date (collectively, the "Excluded Assets").
2.3 ASSUMED LIABILITIES. As of the Closing Date, Buyer shall not assume or
otherwise be obligated for any obligations of Parent or Sellers or their
Affiliates except for all obligations under the Drilling Contracts and Other
Contracts being assumed by Buyer to the extent, but only to the extent, that
such obligations relate to the conduct of the ownership or operation of the
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Purchased Assets after the Closing, but, excluding accounts payable and accrued
liabilities for property received by Parent or any Seller or for services
performed, on or prior to the Closing (collectively, the "Assumed Liabilities"),
which Drilling Contracts and Other Contracts Buyer shall assume and thereafter
perform.
2.4 LIMITATION ON ASSIGNMENTS. Notwithstanding any other provision hereof,
this Agreement shall not constitute nor require an assignment to Buyer of any
Drilling Contract, Other Contract or Permit if an attempted assignment of the
same without the consent of any party would constitute a breach thereof or a
violation of any law or any judgment, decree, order, writ, injunction, rule or
regulation of any Governmental Entity unless and until such consent shall have
been obtained. In the case of any such Drilling Contract, Other Contract or
Permit that cannot be effectively transferred to Buyer without such consent (a
"Consent Required Contract"), Sellers agree that between the date hereof and the
Closing Date they will use their Best Efforts to obtain or cause to be obtained
the necessary consents to the transfer of any Consent Required Contract. Buyer
agrees to cooperate and to cause any Buyer Designee to cooperate with Sellers in
obtaining such consents and to enter into such arrangement of assumption as may
be reasonably requested by Sellers or the other contracting party under a
Consent Required Contract. In the event that Sellers shall have failed prior to
the Closing Date to obtain consents to the transfer of any Consent Required
Contract, the terms of this Section 2.4 shall govern the transfer of the
benefits of each such contract. Sellers and Buyer shall use their Best Efforts
after the Closing Date to obtain any required consent to the assignment to, and
assumption by, Buyer of each Consent Required Contract that is not transferred
to Buyer at the Closing (a "Nonassigned Contract"). Sellers, or a Seller
Designee, and Buyer, or a Buyer Designee, shall enter into an agreement
substantially in the form of that attached hereto as Exhibit 2.4 on the Closing
Date with respect to each Nonassigned Contract providing that until the rights
and obligations of Sellers thereunder are transferred to or assumed by Buyer,
or, if earlier, until termination of such Nonassigned Contract, Sellers shall
continue to perform their obligations thereunder and Buyer shall provide such
assistance, at the sole expense of Buyer, as Sellers may reasonably request for
such purpose, including, without limitation, the use of personnel and assets (by
lease or otherwise) of Buyer and its Affiliates of the type and quantity that
Sellers would have used to perform such Nonassigned Contract had the
transactions contemplated by this Agreement not been consummated. Such agreement
shall also provide that in consideration of the provision of such assistance,
Sellers shall, promptly after payment of any amounts to Sellers by the other
party to a Nonassigned Contract, pay such amounts to Buyer after subtracting
therefrom the costs and expenses incurred by Sellers as a result of Sellers'
performance of the Nonassigned Contract.
2.5 DELIVERY OF RECORDS.
(a) Buyer shall be entitled to the records physically located on the Rigs
on the Closing Date and relevant to the Rigs.
(b) As promptly following the Closing as practicable, Sellers shall
deliver or cause to be delivered to Buyer at the offices where such records are
located or such other location as mutually agreed, a copy of the technical
records described on Schedule 2.5(b) in the possession of Sellers or their
Affiliates related to the Rigs or the Inventory, and that are not physically
located on the Rigs.
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(c) Each Seller shall be entitled to retain all originals of its
corporate, financial, accounting, legal, tax and audit records.
ARTICLE III
PURCHASE PRICE
3.1 CONSIDERATION FOR THE PURCHASED ASSETS.
(a) Concurrently with the execution and delivery of this Agreement, Buyer,
Parent and Southwest Bank of Texas, N.A. (the "Escrow Agent") have executed and
delivered the escrow agreement among Buyer, Parent and the Escrow Agent (the
"Escrow Agreement"), a copy of which is attached as Exhibit 3.1(a), and Buyer
has delivered to the Escrow Agent an amount in cash equal to $10,000,000. Buyer
shall deliver an additional $10,000,000 to the Escrow Agent by no later than
February 21, 1997 (such $10,000,000, together with the $10,000,000 delivered
concurrently with the execution and delivery of this Agreement, is referred to
herein as the "Escrow Funds"). Buyer, Parent and Sellers agree that the Escrow
Agent shall hold and deliver the Escrow Funds in accordance with the terms and
conditions set forth in the Escrow Agreement. Buyer shall have the right at any
time to substitute on a dollar for dollar basis an irrevocable letter of credit
in favor of Parent (drawn on a bank and containing terms and conditions
satisfactory to Parent) for all or a part of the Escrow Funds. For purposes of
this Agreement, any such letter of credit, together with the Escrow Funds, if
any, held by the Escrow Agent shall be referred to herein as the "Deposit".
(b) At the Closing, (i) Buyer shall pay to Parent and Sellers the Purchase
Price by delivering to Sellers the amount of $265,000,000 in immediately
available funds by confirmed wire transfer to a bank account or accounts to be
designated by Parent (such designation to occur no later than the second
business day prior to the Closing Date), and (ii) Parent shall cooperate with
Buyer to (y) cause the Escrow Agent to deliver the Escrow Funds to Buyer, in
accordance with the Escrow Agreement, and (z) release any letter of credit
constituting part of the Deposit.
(c) As additional consideration for the Purchased Assets, the Buyer shall
assume at Closing and shall thereafter perform the Assumed Liabilities.
3.2 BUYER'S DEFAULT. Parent shall be entitled to receive the Deposit, as
liquidated damages and not as a penalty, without right on the part of Buyer to a
return of any part thereof if the Closing
(i) does not occur on the Closing Date by reason of Buyer's default
under the terms of this Agreement; or
(ii) does not occur by June 30, 1997 and Parent and Sellers have
performed their covenants set forth in Section 10.2, unless Buyer has
performed its covenants set forth in Section 10.2 and the sole reason the
Closing has not occurred by such date is that the conditions in Sections
8.5 and 9.5 have not been satisfied;
provided, however, that Parent and Sellers must show themselves then able and
willing to satisfy the conditions set forth in Section 9.1, 9.2, 9.3 and 9.4.
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Buyer shall be deemed in default for the purpose of this Section 3.2 if
Buyer (i) shall have been unable to satisfy any of the conditions set forth in
Sections 8.1, 8.2, 8.3, 8.4 or 9.6, or (ii) shall have failed to perform any of
Buyer's material covenants of this Agreement or have been in material and
willful breach of this Agreement, including by not delivering or having
insufficient funds to deliver the Purchase Price. Notwithstanding anything to
the contrary contained in this Agreement, if the Closing does not occur on the
Closing Date or there is no Closing by June 30, 1997 by reason of Buyer's
default under the terms of the immediately preceding sentence, Parent and
Sellers' sole and exclusive remedy against Buyer and its Affiliates shall be to
receive the Deposit, which the parties stipulate shall be liquidated damages and
not a penalty.
3.3 RETURN OF DEPOSIT. In the event the Closing shall not occur and Parent
is not entitled to receive the Deposit pursuant to Section 3.2, the Escrow Funds
shall be returned to Buyer in the manner specified in the Escrow Agreement and
the letter of credit, if any, constituting part of the Deposit shall be released
to Buyer.
3.4 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be allocated
among the Purchased Assets in the manner set forth on Schedule 3.4. After the
Closing, Parent and Buyer shall cooperate with each other in the preparation,
execution and filing of (i) all information returns and supplements thereto
required to be filed with the Internal Revenue Service by the parties under
Section 1060 of the Code and the Treasury Regulations promulgated thereunder
relating to the allocation of the Purchase Price and (ii) all similar filings
required to be filed with respect to the transactions contemplated by this
Agreement with the Internal Revenue Service and other appropriate taxing
authorities.
ARTICLE IV
THE CLOSING
4.1 TIME AND PLACE OF CLOSING. The Closing shall take place (i) at the
offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C., 1700 Texas Commerce Tower, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, at 9:00 a.m., local time, on the later of (y) June
3, 1997 or (z) the third Business Day following the satisfaction of the
conditions to the obligations of the parties set forth in Sections 8.5 and 9.5,
or (ii) at such other place, date or time as the parties may agree in writing.
The date on which the Closing is required to take place is herein referred to as
the "Closing Date."
4.2 DELIVERIES BY PARENT AND SELLERS. At the Closing, Parent and Sellers
shall deliver the following to Buyer:
(a) a duly executed General Conveyance, Assignment and ▇▇▇▇ of Sale and
Transfer and Assumption of Liabilities (the "General Assignment") in the form of
Exhibit 4.2(a), together with such other bills of sale, assignments and other
instruments of transfer, assignment and conveyance as Buyer shall reasonably
request to vest in Buyer or a Buyer Designee good and marketable title to the
Purchased Assets;
(b) instructions in accordance with the Escrow Agreement;
(c) copies of any consents obtained as contemplated by Section 2.4; and
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(d) the officer's certificates and opinion of counsel contemplated by
Sections 9.3 and 9.4, respectively.
4.3 DELIVERIES BY BUYER. At the Closing, Buyer shall deliver the following
to Parent and Sellers:
(a) the Purchase Price;
(b) a duly executed General Assignment and such other instruments of
transfer and assumption as Parent shall reasonably request in order to cause an
effective assignment to and assumption by Buyer of the Drilling Contracts and
Other Contracts;
(c) instructions in accordance with the Escrow Agreement;
(d) the officer's certificate and opinion of counsel contemplated by
Sections 8.3 and 8.4, respectively; and
(e) the Triton Contracts, duly executed.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller hereby represents and warrants, with respect to itself and the
Purchased Assets owned by it, to Buyer as follows:
5.1 ORGANIZATION AND EXISTENCE.
(a) Seller, if a corporation, is duly incorporated, validly existing and
in good standing under the laws of the state of its incorporation, with all
necessary corporate power and authority to own the Purchased Assets and to carry
on its business as such business is currently conducted.
(b) Seller, if a partnership, is duly formed, validly existing and in good
standing under the laws of the state of its formation, with all necessary
partnership power and authority to own the Purchased Assets and to carry on its
business as such business is currently conducted.
(c) Seller is duly qualified or licensed to transact business as a foreign
corporation or partnership, as the case may be, and is in good standing in all
jurisdictions in which the character of the Purchased Assets or the nature of
the business currently conducted by it requires it so to be qualified or
licensed unless the failure so to qualify or be licensed would not reasonably be
expected to have a material adverse effect on the business of Parent and Sellers
taken as a whole or create an Encumbrance on any of the Purchased Assets, except
for a Permitted Encumbrance.
5.2 AUTHORITY; ETC. Seller has all necessary corporate or partnership, as
the case may be, power and authority to execute and deliver this Agreement and
all agreements, instruments and documents to be executed and delivered hereunder
by Seller, to consummate the transactions
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contemplated hereby and to perform all terms and conditions hereof to be
performed by it, except that Parent, as general partner of NN-1, must obtain the
consent of the sole limited partner in NN-1 to the sale of the Rig, NN-1 (the
"NN-1 Partner's Consent"). The execution and delivery of this Agreement by
Seller and all agreements, instruments and documents to be executed and
delivered by Seller hereunder, the performance by Seller of all the terms and
conditions hereof to be performed by it and the consummation of the transactions
contemplated hereby have been duly authorized and approved by all necessary
corporate or partnership proceedings of Seller, and no other corporate or
partnership proceedings of Seller are necessary with respect thereto, except
that (i) stockholder approval may be necessary in the case of NDUS, NOC and
NDMEX and (ii) Parent must obtain the NN-1 Partner's Consent, which approvals
and consent will be obtained, if necessary, prior to the Closing Date. All
persons who have executed and delivered this Agreement, and all persons who will
execute and deliver the other agreements, documents and instruments to be
executed and delivered by Seller hereunder, have been duly authorized to do so
by all necessary actions on the part of Seller. This Agreement constitutes, and
each other agreement or instrument to be executed by Seller hereunder, when
executed and delivered by Seller, will constitute, the legal, valid and binding
obligation of Seller, enforceable against it in accordance with its terms,
except to the extent the enforceability hereof and thereof may be limited by
bankruptcy, insolvency, moratorium, reorganization or other laws relating to or
affecting creditors' rights generally or by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
5.3 NO VIOLATIONS. The execution and delivery of this Agreement by Seller,
the fulfillment of and compliance by it with the terms and conditions hereof and
the consummation by it of the transactions contemplated hereby will not:
(a) violate any of the terms of the certificate of incorporation or bylaws
(or the equivalent), or partnership agreement, as appropriate, of Seller;
(b) (i) except for the consents to assignment referred to in Section 2.4,
result in a breach of or constitute a default under (whether with notice or the
lapse of time or both) any note, bond, mortgage, loan agreement, indenture or
other instrument evidencing borrowed money to which Seller is a party or by
which Seller is bound or to which any of the Purchased Assets is subject which
breach or default would reasonably be expected to have a material adverse effect
on the ownership or operation of the Purchased Assets, or (ii) result in the
creation of any Encumbrance on any of the Purchased Assets, or otherwise give
any person the right to terminate any Drilling Contract, Permit or Other
Contract assumed by Buyer; or
(c) to Seller's knowledge, violate any provision of any law, statute, rule
or administrative regulation or any judgment, order, injunction or decree of any
Governmental Entity applicable to or binding upon Seller, or its assets, except
that no representation is made as to the application of any United States
antitrust law or regulation to the transactions contemplated by this Agreement,
which violation with respect to the matters specified in clauses (b) and (c) of
this Section 5.3 would reasonably be expected to have a material adverse effect
on the ownership or operation of the Purchased Assets taken as a whole.
5.4 OWNERSHIP OF RIGS. Seller (other than NN-1) owns and, upon the
execution and delivery of the General Assignment at Closing by each Seller
(including NN-1), Buyer will own,
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good and marketable title to the Rigs, free and clear of all Encumbrances except
for Permitted Encumbrances.
5.5 INVENTORY. Seller owns, and upon Seller's execution and delivery of
the General Assignment, Buyer will own, good and marketable title to the
Inventory reflected on Schedule 2.1(c), as such Inventory may be reduced through
the consumption thereof, or increased through replacement thereof or additions
thereto, in the ordinary course of the maintenance and operation of the Rigs
through the Closing Date, free and clear of all Encumbrances except for
Permitted Encumbrances.
5.6 CONTRACTS. Seller has made available to Buyer for review complete and
correct copies of all the Drilling Contracts and Other Contracts. Except as
separately identified on Schedule 2.1(f)(i) or 2.1(f)(ii), each of the Drilling
Contracts and Other Contracts may be transferred to Buyer without the consent of
any person. All the Drilling Contracts and Other Contracts are valid, binding
and in full force and effect against Seller or its Affiliates, as the case may
be, and, to Seller's knowledge, are valid, binding and in full force and effect
against the other parties thereto. Except as set forth on Schedule 5.6, neither
Seller nor any of its Affiliates is in default in any material respect, and no
notice of alleged default has been received by Seller or any of its Affiliates,
under any of the Drilling Contracts and Other Contracts, no other party thereto
is, to the knowledge of Seller or its Affiliates, in default thereunder in any
material respect, and, to the knowledge of Seller or its Affiliates, there
exists no condition or event which, with or without notice or lapse of time or
both, would constitute a material default under any of the Drilling Contracts
and Other Contracts by Seller, any of its Affiliates or any other party thereto.
5.7 LITIGATION.
(a) Except for litigation adequately covered by insurance or otherwise
described on Schedule 5.7(a), there is no litigation and there are no
Proceedings, suits or investigations pending, instituted or, to the knowledge of
Seller, overtly threatened against any of the Purchased Assets or against Seller
or any of its Affiliates and relating to the ownership and operation of the
Purchased Assets before any Governmental Entity applicable to or binding upon
Seller or any of the Purchased Assets that (i) seeks permanent injunctive
relief, (ii) if adversely determined would delay or prevent the consummation of
the transactions contemplated by this Agreement or (iii) would reasonably be
expected to have a material adverse effect on the ownership, maintenance or
operation of the Purchased Assets taken as a whole.
(b) Except for matters described on Schedule 5.7(b), neither Seller nor
any of its properties or assets is subject to any judicial or administrative
judgment, order, decree or restraint currently affecting the ownership,
maintenance and operation of the Purchased Assets in a manner that is material
and adverse to the ownership, maintenance and operation of the Purchased Assets
taken as a whole. Except as referred to on Schedule 5.7(b), Seller has not
received any notifications or charges in writing from any Governmental Entity
involving alleged violations of or alleged obligations to remediate under
occupational safety and health or water quality or other environmental matters
that materially and adversely affect the conduct by Seller of the ownership,
maintenance and operation of the Purchased Assets taken as a whole or that have
not been finally dismissed or otherwise disposed of.
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5.8 GOVERNMENTAL APPROVAL. Except for required filings under the HSR Act
and as set forth on Schedule 5.8, no consent, approval, waiver, order or
authorization of, or registration, declaration or filing with, any Governmental
Entity is required to be obtained or made in connection with the execution and
delivery of this Agreement by Seller or the consummation by Seller of the
transactions contemplated hereby, the failure of which to obtain would have a
material adverse effect on the ownership, maintenance and operation of the
Purchased Assets taken as a whole.
5.9 COMPLIANCE WITH LAWS. Except as set forth on Schedule 5.9, Seller is
not to its knowledge in violation of or in default under any applicable law,
rule, regulation, code, governmental determination, order, governmental
certification requirement or other public limitation, other than Applicable
Environmental Laws (collectively, "Applicable Laws"), relating to the ownership,
maintenance or operation of the Purchased Assets, which violation or default
materially and adversely affects Seller's ownership, maintenance or operation
(as presently conducted) of the Purchased Assets, and no claim is pending or, to
Seller's knowledge, overtly threatened with respect to any such matters which if
determined adversely to Seller would have such effect.
5.10 Reserved.
5.11 RIG CLASSIFICATIONS AND CERTIFICATIONS.
(a) The classification of each Rig and the flag, if any, under which it is
documented are set forth on Schedule 1(a).
(b) Set forth on Schedule 5.11(b) is a summary of the outstanding
recommendations to class against each of the Rigs based on the most recent
survey received by Seller for such Rig as of the date of this Agreement, as well
as a listing of certifications (including American Bureau of Shipping and United
States Coast Guard certifications) maintained by Seller for the present
operation of such and the expiration date of each such certification.
(c) Except as set forth on Schedule 5.11(c), to the knowledge of Seller,
no Rig has suffered any material damage to its condition (ordinary wear and tear
excepted) since February 10, 1997, the date of completion of Buyer's inspection
of the Rigs.
5.12 ENVIRONMENTAL MATTERS.
(a) Seller has received no written notice of any investigation or inquiry
by any Governmental Entity under any Applicable Environmental Laws (as defined
below) relating to the ownership or operation of the Purchased Assets. To the
actual current knowledge of Seller, Seller has not disposed of any hazardous
material (as defined below) on any of the Purchased Assets and no condition
exists on any of the Purchased Assets which would subject Seller or the
Purchased Assets to any remedial obligations under any Applicable Environmental
Laws.
(b) For purposes of this Agreement, "Applicable Environmental Laws" means
any and all Applicable Laws pertaining to health, safety, or the environment in
effect in any and all jurisdictions in which the Purchased Assets are located or
in which Seller has conducted
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operations using any of the Purchase Assets, including, without limitation, the
Clear Air Act, as amended, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, the Rivers and Harbors Act
of 1899, as amended, the Federal Water Pollution Control Act, as amended, the
Occupational Safety and Health Act of 1970, as amended, the Resource
Conservation and Recovery Act of 1976, as amended, the Safe Drinking Water Act,
as amended, the Toxic Substances Control Act, as amended, the Superfund
Amendments and Reauthorization Act of 1986, as amended, the Hazardous Materials
Transportation Act, as amended, and other environmental conservation or
protection laws. For purposes of this Agreement, the term "hazardous material"
means (i) any substance which is listed or defined as a hazardous substance,
hazardous constituent, or solid waste pursuant to any Applicable Environmental
Laws and (ii) petroleum (including crude oil and any fraction thereof), natural
gas and natural gas liquids.
5.13 NO BROKERS. Seller has not employed or authorized anyone to represent
it as a broker or finder in connection with the transactions contemplated by
this Agreement, and no broker or other person is entitled to any commission or
finder's fee from Seller in connection with such transactions. Seller agrees to
indemnify and hold harmless Buyer from and against any and all losses, claims,
demands, damages, costs and expenses, including, without limitation, reasonable
attorneys' fees and expenses, Buyer may sustain or incur as a result of any
claim for a commission or fee by a broker or finder acting on behalf of Seller.
5.14 DECREES, ETC. No order, writ, injunction, decree, judgment, award or
determination of any court or Governmental Entity has been issued or entered
against Seller or any of its Affiliates which continues to be in effect and
affects the ownership or operation of the Purchased Assets.
5.15 PERFORMANCE BONDS; LETTERS OF CREDIT. Set forth on Schedule 5.15 is a
listing of all performance and similar bonds and letters of credit currently
posted by, or any certificate of financial responsibility or similar evidence of
financial accountability obtained or procured by, Seller or any of its
Affiliates for the purpose of operating the Rigs.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PARENT
Parent hereby represents and warrants to Buyer as follows:
6.1 ORGANIZATION AND EXISTENCE. Parent is a corporation duly incorporated,
validly existing and in good standing under the laws of the state of its
incorporation, with all necessary corporate power and authority to own and lease
the assets it currently owns and leases and to carry on its business as such
business is currently conducted. Parent is duly qualified or licensed to
transact business as a foreign corporation and is in good standing in all
jurisdictions in which the character of the assets currently owned or leased by
it or the nature of the business currently conducted by it requires it so to be
qualified or licensed unless the failure so to qualify or be licensed would not
reasonably be expected to have a material adverse effect on the business or
financial condition of Parent and its subsidiaries taken as a whole.
13
6.2 AUTHORITY; ETC. Parent has all necessary corporate power and authority
to execute and deliver this Agreement and all agreements, instruments and
documents to be executed and delivered hereunder by Parent, to consummate the
transactions contemplated hereby and to perform all terms and conditions hereof
to be performed by it. The execution and delivery of this Agreement by Parent
and all agreements, instruments and documents to be executed and delivered by
Parent hereunder, the performance by Parent of all the terms and conditions
hereof to be performed by it and the consummation of the transactions
contemplated hereby have been duly authorized and approved by the board of
directors of Parent, and no other corporate proceedings of Parent are necessary
with respect thereto. All persons who have executed and delivered this
Agreement, and all persons who will execute and deliver the other agreements,
documents and instruments to be executed and delivered by Parent hereunder, have
been duly authorized to do so by all necessary actions on the part of Parent.
This Agreement constitutes, and each other agreement or instrument to be
executed by Parent hereunder, when executed and delivered by Parent, will
constitute, the legal, valid and binding obligation of Parent, enforceable
against it in accordance with its terms, except to the extent the enforceability
hereof and thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or other laws relating to or affecting creditors' rights
generally or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
6.3 NO VIOLATIONS. The execution and delivery of this Agreement by Parent,
the fulfillment of and compliance by it with the terms and conditions hereof and
the consummation by it of the transactions contemplated hereby will not:
(a) violate any of the terms of the certificate of incorporation or bylaws
of Parent;
(b) result in a breach of or constitute a default under (whether with
notice or the lapse of time or both) any note, bond, mortgage, loan agreement,
indenture or other instrument evidencing borrowed money to which Parent is a
party or by which Parent is bound or to which any of its assets is subject or
result in the creation of any Encumbrance on any of its assets, which breach or
default would reasonably be expected to have a material adverse effect on its
ability to perform its obligations hereunder; or
(c) to Parent's knowledge, violate any provision of any law, statute, rule
or administrative regulation or any judgment, order, injunction or decree of any
Governmental Entity applicable to or binding upon Parent or any of its
subsidiaries, except that no representation is made as to the application of any
United States antitrust law or regulation to the transactions contemplated by
this Agreement, which violation with respect to the matters specified in clauses
(b) and (c) of this Section 6.3 would reasonably be expected to have a material
adverse effect on its ability to perform its obligations hereunder.
6.4 GOVERNMENTAL APPROVAL. Except for required filings under the HSR Act
and as contemplated by Section 10.2 or set forth on Schedule 6.4, no consent,
approval, waiver, order or authorization of, or registration, declaration or
filing with, any Governmental Entity is required to be obtained or made in
connection with the execution and delivery of this Agreement by Parent or the
consummation by Parent of the transactions contemplated hereby, the failure of
which to obtain would delay or prevent the consummation of the transactions
contemplated by this Agreement.
14
6.5 LITIGATION. There is no litigation and there are no Proceedings, suits
or investigations pending, instituted or, to the knowledge of Parent overtly
threatened against Parent or its subsidiaries that could reasonably be expected
to delay or prevent the consummation of the transactions contemplated by this
Agreement.
6.6 NO BROKERS. Except for ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co. Incorporated (whose fee
in respect of the transactions contemplated hereby shall be paid solely by
Parent), Parent has not employed or authorized anyone to represent it as a
broker or finder in connection with the transactions contemplated by this
Agreement, and no broker or other person is entitled to any commission or
finder's fee from Parent in connection with such transactions. Parent will
indemnify and hold harmless Buyer from and against any and all losses, claims,
demands, damages, costs and expenses, including, without limitation, reasonable
attorneys' fees and expenses, Buyer may sustain or incur as a result of any
claim for a commission or fee by a broker or finder acting on behalf of Parent.
6.7 EMPLOYEES AND RELATED MATTERS. To Parent's knowledge, all of the
employee benefit plans (as defined in Section 3(3) of ERISA) which are or have
been maintained or contributed to by Parent or any incorporated or
unincorporated trade or business (an "ERISA Affiliate") which together with
Parent would be treated as a single employer under Section 414 of the Code have
been maintained and contributed to in compliance with the requirements of ERISA,
the Code and other applicable law; and to Parent's knowledge, Parent and its
ERISA Affiliates have paid and discharged when due all obligations and
liabilities arising under such plans, ERISA, the Code and other Applicable Law
of a character which, if not paid or discharged, are likely to result in the
imposition of an Encumbrance or the assertion of a liability enforceable against
the Purchased Assets. There are no labor agreements between Parent or any
Affiliate of Parent and any collective bargaining representative who represents
employees employed by Parent or any of its Affiliates which relate to or affect
the ownership, maintenance or operation of the Purchased Assets.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Parent and each of the Sellers as
follows:
7.1 ORGANIZATION AND EXISTENCE. Buyer is a corporation duly incorporated,
validly existing and in good standing under the laws of the state of its
incorporation, with all necessary corporate power and authority to own and lease
the assets it currently owns and leases and to carry on its business as such
business is currently conducted. Buyer is duly qualified or licensed to transact
business as a foreign corporation and is in good standing in all jurisdictions
in which the character of the assets currently owned or leased by it or the
nature of the business currently conducted by it requires it so to be qualified
or licensed unless the failure so to qualify or be licensed would not reasonably
be expected to have a material adverse effect on the business or financial
condition of Buyer and its subsidiaries taken as a whole.
7.2 AUTHORITY; ETC. Buyer has all necessary corporate power and authority
to execute and deliver this Agreement and all agreements, instruments and
documents to be executed and
15
delivered hereunder by Buyer, to consummate the transactions contemplated hereby
and to perform all terms and conditions hereof to be performed by it. The
execution and delivery of this Agreement by Buyer and all agreements,
instruments and documents to be executed and delivered by Buyer hereunder, the
performance by Buyer of all the terms and conditions hereof to be performed by
it and the consummation of the transactions contemplated hereby have been duly
authorized and approved by the board of directors of Buyer, and no other
corporate proceedings of Buyer are necessary with respect thereto. All persons
who have executed and delivered this Agreement, and all persons who will execute
and deliver the other agreements, documents and instruments to be executed and
delivered by Buyer hereunder, have been duly authorized to do so by all
necessary actions on the part of Buyer. This Agreement constitutes, and each
other agreement or instrument to be executed by Buyer hereunder, when executed
and delivered by Buyer, will constitute, the legal, valid and binding obligation
of Buyer, enforceable against it in accordance with its terms, except to the
extent the enforceability hereof and thereof may be limited by bankruptcy,
insolvency, moratorium, reorganization or other laws relating to or affecting
creditors' rights generally or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
7.3 NO VIOLATIONS. The execution and delivery of this Agreement by Buyer,
the fulfillment of and compliance by it with the terms and conditions hereof and
the consummation by it of the transactions contemplated hereby will not:
(a) violate any of the terms of the certificate of incorporation or bylaws
of Buyer;
(b) result in a breach of or constitute a default under (whether with
notice or the lapse of time or both) any note, bond, mortgage, loan agreement,
indenture or other instrument evidencing borrowed money to which Buyer is a
party or by which Buyer is bound or to which any of its assets is subject or
result in the creation of any Encumbrance on any of its assets, which breach or
default would reasonably be expected to have a material adverse effect on its
ability to perform its obligations hereunder; or
(c) to Buyer's knowledge, violate any provision of any law, statute, rule
or administrative regulation or any judgment, order, injunction or decree of any
Governmental Entity applicable to or binding upon Buyer or any of its
subsidiaries, except that no representation is made as to the application of any
United States antitrust law or regulation to the transactions contemplated by
this Agreement, which violation with respect to the matters specified in clauses
(b) and (c) of this Section 7.3 would reasonably be expected to have a material
adverse effect on its ability to perform its obligations hereunder.
7.4 INSPECTIONS. Buyer has made its own inspection of each of the Rigs
except the NN-1 and the ▇▇▇▇▇▇▇▇▇▇ Hull.
7.5 LITIGATION. There is no litigation and there are no Proceedings, suits
or investigations pending, instituted or, to the knowledge of Buyer overtly
threatened against Buyer or its subsidiaries that could reasonably be expected
to delay or prevent the consummation of the transactions contemplated by this
Agreement.
16
7.6 GOVERNMENTAL APPROVAL. Except for required filings under the HSR Act
and as contemplated by Section 10.2 or set forth on Schedule 7.6, no consent,
approval, waiver, order or authorization of, or registration, declaration or
filing with, any Governmental Entity is required to be obtained or made in
connection with the execution and delivery of this Agreement by Buyer or the
consummation by Buyer of the transactions contemplated hereby, the failure of
which to obtain would delay or prevent the consummation of the transactions
contemplated by this Agreement.
7.7 NO BROKERS. Buyer has not employed or authorized anyone to represent
it as a broker or finder in connection with the transactions contemplated by
this Agreement, and no broker or other person is entitled to any commission or
finder's fee from Buyer in connection with such transactions. Buyer will
indemnify and hold harmless Parent and Sellers from and against any and all
losses, claims, demands, damages, costs and expenses, including, without
limitation, reasonable attorneys' fees and expenses, Parent and/or any Seller
may sustain or incur as a result of any claim for a commission or fee by a
broker or finder acting on behalf of Buyer.
7.8 CERTAIN KNOWLEDGE REGARDING ASSIGNMENT OF CONTRACTS. To the knowledge
of Buyer, no condition or circumstance exists that would prevent the obtainment
of any necessary consents to the effective assignment to and assumption by Buyer
of the Drilling Contracts or Other Contracts.
7.9 REGISTRATION STATEMENT. On February 7, 1997, Buyer filed a
registration statement on Form S-3 (file no. 333-21385) (the "Registration
Statement") with the SEC under the Securities Act of 1933, as amended (the
"Securities Act"), covering a maximum aggregate offering of $500,000,000 of
Buyer's debt securities and common stock.
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF PARENT AND SELLERS
The obligations of Parent and Sellers to proceed with the Closing
contemplated by this Agreement are subject to the satisfaction, on or before the
Closing Date, of all the following conditions, any one or more of which may be
waived, in whole or in part, by Parent:
8.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each representation and
warranty of Buyer contained in this Agreement shall be true and correct in all
material respects as of the Closing Date with the same effect as though made on
the Closing Date, except as otherwise specifically contemplated by this
Agreement.
8.2 COVENANTS AND AGREEMENTS PERFORMED. Buyer shall have complied on or
before the Closing Date in all material respects with each of its covenants or
agreements contained in this Agreement to be performed on or before the Closing
Date.
8.3 OFFICER'S CERTIFICATE. Parent and Sellers shall have received a
certificate in the form of Exhibit 8.3 hereto, dated as of the Closing Date, of
the President or a Vice President of Buyer certifying as to the matters
specified in Sections 8.1 and 8.2.
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8.4 LEGAL OPINION. Parent and Sellers shall have received from ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq., Vice President, General Counsel and Secretary of Buyer, an
opinion dated the Closing Date, substantially in the form of Exhibit 8.4 hereto.
8.5 HSR ACT. All required filings under the HSR Act shall have been made
as required and the waiting period (and any extension thereof) under the HSR Act
relating to the transactions contemplated hereby shall have expired or been
terminated without governmental objection thereto.
ARTICLE IX
CONDITIONS TO THE OBLIGATIONS OF BUYER
The obligations of Buyer to proceed with the Closing contemplated by this
Agreement are subject to the satisfaction, on or before the Closing Date, of all
the following conditions, any one or more of which may be waived, in whole or in
part, by Buyer:
9.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES.
(a) Each representation and warranty of Sellers contained in this
Agreement shall be true and correct in all material respects as of the Closing
Date with the same effect as though made on the Closing Date, except as
otherwise specifically contemplated by this Agreement.
(b) Each representation and warranty of Parent contained in this Agreement
shall be true and correct in all material respects as of the Closing Date with
the same effect as though made on the Closing Date, except as otherwise
specifically contemplated by this Agreement.
9.2 COVENANTS AND AGREEMENTS PERFORMED.
(a) Sellers shall have complied on or before the Closing Date in all
material respects with each of the covenants or agreements of Sellers contained
in this Agreement to be performed on or before the Closing Date.
(b) Parent shall have complied on or before the Closing Date in all
material respects with each of the covenants or agreements of Parent contained
in this Agreement to be performed on or before the Closing Date.
9.3 OFFICER'S CERTIFICATE.
(a) Buyer shall have received a certificate in the form of Exhibit 9.3(a)
hereto, dated as of the Closing Date, of the President or a Vice President, or
the general partner of each Seller certifying as to the matters specified in
Sections 9.1(a) and 9.2(a).
(b) Buyer shall have received a certificate in the form of Exhibit 9.3(b)
hereto, dated as of the Closing Date, of the President or a Vice President of
Parent certifying as to the matters specified in Sections 9.1(b) and 9.2(b).
18
9.4 LEGAL OPINION. Buyer shall have received from ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C.,
counsel for Parent and Sellers, an opinion dated the Closing Date, substantially
in the form of Exhibit 9.4 hereto.
9.5 HSR ACT. All required filings under the HSR Act shall have been made
as required and the waiting period (and any extension thereof) under the HSR Act
relating to the transactions contemplated hereby shall have expired or been
terminated without governmental objection thereto.
9.6 FINANCING BY BUYER. Buyer shall have obtained financing for the
Purchased Assets in an amount no less than the Purchase Price.
ARTICLE X
COVENANTS AND AGREEMENTS OF THE PARTIES BEFORE,
RELATING TO AND SUBSEQUENT TO THE CLOSING
Parent, Sellers and Buyer hereby covenant and agree as follows:
10.1 EXPENSES. Except as otherwise expressly provided in this Agreement,
each of the parties hereto shall assume and bear all expenses, costs and fees
incurred or assumed by such party in the preparation and execution of this
Agreement and in compliance with and performance of the agreements and covenants
contained in this Agreement, regardless of whether the transactions contemplated
hereby are consummated.
10.2 HSR ACT COMPLIANCE. The parties shall comply with all provisions of
the HSR Act. Parent, Sellers and Buyer agree to cooperate with each other and
furnish all information to the other party that is necessary in connection with
the HSR Act filings required to be made by the parties hereto. Buyer and Parent
each agree to request early termination of any applicable waiting period under
the HSR Act.
10.3 ACCESS. Until the Closing, Parent and Sellers shall give the
officers, employees and attorneys of Buyer reasonable access, subject to
Applicable Laws, during normal business hours upon Buyer's reasonable prior
notice to Parent, to the Purchased Assets and the records of Sellers
specifically relating thereto. Parent and Sellers will cooperate fully with such
representatives of Buyer in connection with such review. Buyer will hold in
strict confidence and not use for purposes other than those contemplated by this
Agreement any documents or information furnished concerning Parent, Sellers or
the Purchased Assets. Such confidence shall be maintained for at least two years
after the date of this Agreement. If the transactions contemplated by this
Agreement shall not be consummated, all such documents and all copies thereof
shall immediately thereafter be returned to Parent, and all documents prepared
by Buyer or any of its Affiliates or their representatives shall be destroyed.
The confidentiality obligations set forth in the preceding sentence shall not
apply to information (i) in the public domain, (ii) obtained by Buyer from a
third party source with the right to disclose such information or (iii) with
respect to which disclosure is required by law in the opinion of counsel to
Buyer reasonably acceptable to Parent. Buyer agrees to assume the risk of
personal injury to its representatives or loss of or damage to its and its
representatives' property occurring during the course of investigating the
Purchased Assets, Parent and Sellers, regardless of any fault
19
(including the negligence) of any of Parent, Sellers or their Affiliates, and
Buyer will indemnify and hold harmless Parent, Sellers and their Affiliates from
and against any and all losses, claims, demands, damages, costs and expenses,
including, without limitation, reasonable attorneys' fees and expenses, Parent,
any Seller and/or any of their Affiliates may sustain or incur as a result of
any such personal injury or loss of or damage to property.
10.4 CONDUCT OF BUSINESS AND PRESERVATION OF ASSETS.
(a) Until the Closing, Buyer and Sellers agree to cooperate with each
other to effect an orderly transition of the ongoing operation of the Purchased
Assets and Sellers shall use their respective Best Efforts to preserve, maintain
and protect the Purchased Assets. From and after the date of this Agreement and
until the Closing Date, without the prior express written consent of Buyer,
which consent shall not be unreasonably withheld or delayed, Sellers will not,
and Parent will not permit any of its Affiliates to, (i) make any material
change in the conduct of the ongoing operation of the Rigs taken as a whole,
(ii) enter into any new drilling contracts with respect to the Rigs or any other
contracts or agreements with respect to the Rigs other than the PEMEX Contracts
and other contracts entered into in the ordinary course of business that are not
expected to extend beyond 180 days, or amend, in any respect adverse to Sellers
or Buyer, any Drilling Contract or Other Contract or (iii) commit itself to do
any of the foregoing.
(b) Buyer, Parent and Sellers acknowledge that the ▇▇▇▇▇ ▇▇▇▇▇▇ is
currently undergoing refurbishment at Texas Drydock, Inc., in Port ▇▇▇▇▇▇,
Texas. NDUS agrees, at its expense, to complete the refurbishment contemplated
under its shipyard contract for such refurbishment work, and upon completion of
such refurbishment, to obtain such certifications from Governmental Entities as
are necessary to permit the ▇▇▇▇▇ ▇▇▇▇▇▇ to engage in offshore oil and gas
drilling and workover operations in the U.S. Gulf of Mexico.
10.5 TRANSITION OF BUSINESS OPERATIONS. Buyer will use its Best Efforts to
obtain and to cause any Buyer Designee to obtain prior to the Closing Date all
requisite qualifications or licenses to transact business as a foreign
corporation in each jurisdiction in which the consummation of the transactions
contemplated hereby or the nature of the business to be conducted by it after
the Closing requires it so to be qualified or licensed. If Buyer or any Buyer
Designee is not so duly qualified or licensed on the Closing Date, then (i)
Buyer agrees to use its Best Efforts to become or to cause each Buyer Designee
to become so qualified or licensed at the earliest practicable date and (ii)
Sellers agree to cooperate with Buyer to effect the consummation of the
transactions contemplated by this Agreement, provided same can be effected
without violation of law in the jurisdiction involved and any additional expense
associated with same is borne by Buyer.
10.6 LITIGATION. Until the Closing, Parent will promptly notify Buyer of
any action, suit, proceeding, claim or investigation which is overtly threatened
or commenced against a Seller which is not fully insured against (except
standard deductible or self-retention amounts) and which relates to or affects
the Purchased Assets or this Agreement or the transactions contemplated hereby,
and Buyer will promptly notify Parent of any action, suit, proceeding, claim or
investigation which is overtly threatened or commenced against Buyer which is
not fully insured against (except standard deductible or self-retention amounts)
and which relates to and
20
materially and adversely affects Buyer or its business or affects this Agreement
or the transactions contemplated hereby.
10.7 CERTAIN TAXES. Buyer shall be liable for and shall pay all applicable
duties, sales, use, transfer, stamp, recording, value added or similar taxes and
assessments payable as a result of the consummation of the transactions
contemplated hereby, and Buyer and Sellers agree to cooperate to obtain all
available exemptions from such taxes. All ad valorem taxes, utility and other
service charges and other taxes, fees and expenses relating to the Purchased
Assets (collectively, "Taxes"), for all periods up to and including the Closing
Date shall be the obligations of Sellers and for all periods following the
Closing Date shall be the obligation of Buyer. All Taxes relating to periods
prior to the Closing that have been assessed prior to Closing and that are not
then being diligently contested in good faith by appropriate proceedings shall
be paid by a Seller prior to the Closing. Each Seller shall promptly pay from
time to time such Seller's prorated share of all Taxes to Buyer upon Buyer's
request accompanied by appropriate documentation that such Taxes are due and
payable. Buyer agrees to pay such amounts on behalf of such Seller and to
indemnify such Seller with respect to any Claims (as defined in Section 13.2)
for such Taxes if a Seller shall have paid to Buyer such Seller's pro rata share
thereof, if any. Sellers and Buyer agree to cooperate with each other in order
to reduce the amount of taxes or other assessments imposed on or charged to any
Seller or Buyer as a result of the consummation of the transactions contemplated
by this Agreement, including, without limitation, by (i) accommodating a
tax-deferred exchange by one or more Sellers under Section 1031 of the Code or
(ii) effectively transferring ownership of Purchased Assets to Buyer by
transferring to Buyer all of the outstanding ownership interest in the entity
that owns such Purchased Assets; provided, that none of Parent, any Seller nor
Buyer shall be obligated to take any action that it determines in its sole
discretion may subject it to additional taxes, liabilities or expenses.
10.8 ACTIONS WITH RESPECT TO CLOSING. Each of Parent and each Seller will
use its Best Efforts to obtain and to cause any Seller Designee to obtain the
satisfaction of the conditions to Closing applicable to Parent and Sellers set
forth in Article IX as soon as practicable. Buyer will use its Best Efforts to
obtain and to cause each Buyer Designee to obtain the satisfaction of the
conditions to Closing applicable to Buyer set forth in Article VIII as soon as
practicable.
10.9 PUBLIC STATEMENTS. Prior to making any news release or other
announcement concerning the transactions contemplated hereby, Buyer and Parent
shall consult with each other regarding the proposed contents thereof (but no
approval thereof shall be required).
10.10 BOOKS AND RECORDS. Parent and Sellers shall have the right, at their
own expense, at any time or from time to time within five years after the
Closing Date during reasonable business hours upon reasonable notice to Buyer to
inspect, and make copies of or extracts from, any of the records delivered to
Buyer at the Closing that are in the possession of Buyer or its Affiliates. None
of the records in the possession of Buyer or its Affiliates shall be destroyed
prior to December 31, 2002 or five years after generated, whichever is earlier,
without the consent of Parent, unless first reproduced by microfilm or any other
similar process. In the event that Buyer shall wish to destroy any of such
records at any time or from time to time after the Closing Date, Buyer shall
give not less than 60 days' notice to Parent and Parent shall have
21
the right, at its own expense, during reasonable business hours to remove such
records and to keep possession of the same.
10.11 RIG LOSS. Notwithstanding any other provision of this Agreement:
(a) If any Rig (other than the ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇) shall become an actual or
constructive total loss (as determined by Parent's insurance underwriter's
marine surveyor) prior to the Closing Date: (i) Buyer shall not be required to
purchase such Rig, (ii) the Purchase Price shall be reduced by the amount
allocated to such Rig pursuant to Schedule 3.4, (iii) the term "Purchased
Assets" shall be deemed not to include such Rig and (iv) the other provisions of
this Agreement shall continue to be in effect and the Closing shall take place
in the manner contemplated herein.
(b) Without limiting the obligations of any Seller or Parent under Section
10.4(a), if a Rig sustains damage not amounting to an actual or constructive
total loss prior to the Closing Date, either (i) the Seller owning such Rig
shall repair or cause to be repaired the damage to the Rig at such Seller's own
expense or (ii) in the case of damage to a Rig in respect of which insurance
proceeds are available, Buyer, at its option, may require the Seller to assign
to Buyer at the Closing the rights the Seller has to receive insurance proceeds
in respect of such loss or damage and pay to Buyer the amount by which any such
insurance proceeds otherwise payable to Buyer are reduced by any deductible or
deductibles under the terms of the relevant policy or policies (offset by any
amounts paid through the Closing Date by the Seller for such repair), and, in
the case of either (i) or (ii) above, Buyer shall remain obligated to purchase
the Purchased Assets on the Closing Date and the Purchase Price shall not be
reduced. If, pursuant to this subsection (b), Buyer is to conduct or cause to be
conducted repairs to a damaged Rig subsequent to Closing, then Parent and Buyer
shall agree on a plan for the manner of conduct and the scope of such repairs,
and neither Parent nor any Seller shall be obligated to pay costs resulting from
any deviation from such plan.
10.12 USE OF NAMES. Buyer agrees that (i) it will not use the name "Noble"
or "Noble Drilling" or any derivative thereof, (ii) it will within 90 days of
the Closing Date, change the name of each Rig to other than the name of a
current or former personnel or associate of Parent, and (iii) it will within 90
days from the Closing Date, remove from the Purchased Assets or paint over such
name and any logos, symbols or trademarks relating thereto.
10.13 CONTINUED EFFECTIVENESS OF REPRESENTATIONS AND WARRANTIES. Each of
Parent, each Seller and Buyer shall use its Best Efforts to cause the
representations and warranties made by it herein to continue to be true and
correct on and as of the Closing Date as if made on and as of the Closing Date.
Nothing contained in this Section 10.13 shall be construed as being inconsistent
with or in derogation of Section 13.1 or 13.5.
10.14 POST-CLOSING COLLECTION, PAYMENT AND ADMINISTRATIVE PROCEDURES.
Subsequent to Closing, (i) Buyer agrees to deliver to Parent, within three
Business Days of receipt of same, any and all (A) monies paid to or received by
Buyer or its Affiliates in respect of amounts due Sellers or their Affiliates,
including, but not limited to, payment of receivables, refunds, rebates, release
of performance or similar bonds or letters of credit, and (B) inquiries,
correspondence or documents received by Buyer or its Affiliates related to such
amounts; and (ii) Sellers and
22
Parent agree to deliver to Buyer, within three Business Days of receipt of same,
any and all (A) monies paid to or received by Sellers or their Affiliates in
respect of amounts due Buyer or its Affiliates, including, but not limited to,
payment of receivables, refunds, rebates, release of performance or similar
bonds or letters of credit, and (B) inquiries, correspondence or documents
received by Sellers or their Affiliates related to such amounts.
10.15 ACTION OF BUYER REGARDING FINANCING.
(a) Buyer shall promptly after the date of this Agreement initiate and
diligently pursue action to obtain financing in an amount not less than the
Purchase Price. In such connection, Buyer agrees to amend the Registration
Statement or supplement to the prospectus forming a part thereof to provide for
the firm commitment underwritten offer and sale of its debt securities and/or
common stock and/or arrange for bank financing in an amount not less than the
Purchase Price. Buyer shall consult with Parent, and Parent shall cooperate with
and assist Buyer, in preparing any amendment to the Registration Statement or
supplement to the prospectus forming a part thereof, particularly with respect
to the information therein relating to Parent or Sellers. Buyer agrees to use
its Best Efforts to cause the Registration Statement to become effective under
the Securities Act as soon as practicable.
(b) Buyer shall keep Parent informed at all times with respect to the
status of the financing contemplated by subsection (a) of this Section 10.15 and
in any event shall inform Parent (i) of notice from the SEC of the effectiveness
of the Registration Statement under the Securities Act, (ii) upon pricing of the
securities under the Registration Statement or (iii) upon receipt by Buyer of
notice from the SEC of the issuance of a stop order with respect to the
Registration Statement.
10.16 CERTAIN FINANCIAL STATEMENTS. Parent agrees to prepare, or cause the
preparation of, and to deliver to Buyer as soon as practicable following the
date of this Agreement for inclusion in the Registration Statement or otherwise
in connection with the financing contemplated by Section 10.15 or in any Form
8-K or other form of Buyer relating to the transactions contemplated hereby
required, if any, to be filed with the SEC, such financial statements relating
to Sellers or the Purchased Assets as Buyer may be required by Applicable Law to
include therein. Buyer shall pay the fees of Price Waterhouse LLP, independent
accountants for Parent and Sellers, relating to the preparation and audit of
such financial statements and the participation, if any, of Price Waterhouse LLP
in the preparation of an amendment to the Registration Statement or other
documents filed by Buyer with the SEC or otherwise in connection with the
financing contemplated by Section 10.15.
10.17 IMPORT DUTIES; PERFORMANCE BONDS. If any Seller or any subsidiary of
any Seller has posted a performance or other similar bond or letter of credit or
procured any certificate of financial responsibility or similar evidence of
financial accountability in connection with any Seller's or any such
subsidiary's ownership or operation of any of the Rigs or the performance by any
Seller or any such subsidiary under a Drilling Contract or Other Contract, Buyer
and Sellers shall cooperate in order (i) for Sellers or any of Sellers'
subsidiaries to obtain the release of any such bond, letter of credit or
certificate and (ii) to the extent required, for Buyer to obtain a substitute
bond, letter of credit or certificate or to assume the existing bond, letter of
credit or certificate of any Seller or any subsidiary of any Seller. Sellers and
Buyer agree to cooperate
23
with each other in order to reduce import duties assessed against any Seller or
any subsidiary of any Seller, or Buyer as a result of the consummation of the
transactions contemplated by this Agreement, including by postponing the date of
transfer of legal title to any Rig operating in foreign waters until completion
of the Drilling Contract under which such a Rig is operating on the Closing
Date; provided, that neither Sellers, any subsidiary of any Seller nor Buyer
shall be obligated to take any action that it determines in its sole discretion
may subject it to additional import duties, liabilities or expenses. Buyer shall
reimburse Sellers or any subsidiary of any Seller for all out-of-pocket costs
incurred by any Seller or any such subsidiary as a result of their leaving a
performance or similar bond, letter of credit or certificate in place after the
Closing Date in order to permit Buyer to operate the Purchased Assets after the
Closing Date.
10.18 AVAILABILITY OF RIGS TO TRITON ENGINEERING SERVICES COMPANY.
(a) On or before the Closing Date and subject to the occurrence of the
Closing, Buyer and Triton Engineering Services Company or one or more of its
subsidiaries ("Triton") shall enter into a drilling contract for each of four of
the Rigs, pursuant to which, effective as of the termination of the drilling
contract for such Rig in existence on the Closing Date, Buyer will agree to
contract each of such Rigs to Triton for drilling and workover operations.
Parent shall designate the four Rigs prior to the Closing Date. Each of such
drilling contracts (the "Triton Contracts") shall be substantially in the form
of Exhibit 10.18. Anything in this Section 10.18(a) to the contrary
notwithstanding, if prior to the Closing Date a Seller has entered into a
contract with Triton to provide one or two of the Rigs to Triton for operations
in the Mexican Gulf of Mexico on behalf of PEMEX for terms exceeding the
one-year anniversary of the Closing Date and containing operating day rates
(fixed for the term of such contracts) of at least $32,000 per day and such
other terms as are acceptable to Buyer ("PEMEX Contracts"), then Buyer shall
assume at Closing and agree to perform thereafter such PEMEX Contracts in
accordance with the terms thereof and the number of Rigs which shall become
subject to Triton Contracts under this Section 10.18(a) shall be reduced by the
number of such Rigs that are subject to the PEMEX Contracts as of the Closing
Date.
(b) Parent shall have the option, exercisable within one year after the
Closing Date, to cause Buyer to contract to Triton up to three additional Rigs
(other than the ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ and the ▇▇▇▇▇ ▇▇▇▇▇▇) on contracts containing
the same terms and conditions as specified in Section 10.18(a) except that the
term of any such contract will be one year from the effective date of such
contract. During the one-year term of such option, Buyer shall give Parent 30
days advance notice of the expected date of completion of any drilling contract
with respect to a Rig other than the Rigs referred to in Subsection 10.18(a).
Parent shall have until the later of 15 days after receipt of Buyer's notice and
30 days prior to such date of completion of such contract to notify Buyer of
Parent's election to cause Buyer to contract such Rig to Triton. Any drilling
contracts entered into pursuant to this Section 10.18(b) shall also be referred
to herein as a "Triton Contract".
10.19 ACQUISITION PROPOSAL. Seller shall immediately cease or cause to be
terminated any existing activities, discussions or negotiations with any persons
conducted heretofore with respect to any Acquisition Proposal. Parent and
Sellers hereby agree that, without the prior express written consent of Buyer,
which consent shall not be unreasonably withheld or delayed, neither Parent nor
Sellers nor any director, officer, employee, representative or advisor of Parent
24
or Sellers will, directly or indirectly, (i) solicit, initiate or pursue any
Acquisition Proposal (as defined below) or (ii) except to the extent the Board
of Directors of Parent determines, upon advice of counsel, that it is otherwise
legally required by its fiduciary duties, engage in discussions or negotiations
with, or disclose any nonpublic information relating to Parent or Sellers or
afford access to the properties, books or records of Parent or Sellers to, any
person that may be considering making or has made an Acquisition Proposal.
Should Parent or Sellers receive an Acquisition Proposal, Parent will
immediately notify Buyer of such proposal. Subject to payment of the $15,000,000
liquidated damages amount provided for in Section 12.2, nothing contained in
this Agreement shall prevent the Board of Directors of Parent from approving any
unsolicited Acquisition Proposal if required in the exercise of its fiduciary
duties, as determined by the Board of Directors of Parent after consultation
with legal counsel. The term "Acquisition Proposal," as used herein, means any
offer or proposal for, or any indication of interest in the acquisition of any
two or more of the Rigs (other than the transactions contemplated by this
Agreement). The provisions of this Section 10.19 shall remain in effect until
the earlier of the termination of this Agreement pursuant to Section 12.1 or the
Closing.
ARTICLE XI
EMPLOYEES
11.1 EMPLOYEES.
(a) The employment of all employees of Sellers or any of their Affiliates
who work on any of the Rigs, other than the Retained Employees, shall be
terminated effective as of the Closing Date. Buyer may, but is not in any way
obligated to, offer employment to some or all of the terminated employees upon
such terms and conditions as Buyer shall determine.
(b) For the purposes of this Agreement, "Retained Employees" shall mean
the employees of Sellers or any of their Affiliates identified by Parent in a
schedule delivered by Parent to Buyer at least five days prior to the Closing
Date. Such schedule shall set forth a list of the names, positions and salaries
or hourly rates, as applicable, of the Retained Employees as of the date
thereof. At the Closing, Parent shall deliver to Buyer, if necessary, a revised
schedule updating such information as of the Closing Date. Parent shall have the
right to identify on such schedule a number of Retained Employees sufficient to
crew not more than five of the Rigs.
(c) Neither Sellers nor Parent, nor any of their Affiliates, shall be
required to terminate the employment of the Retained Employees in connection
with the consummation of the transactions contemplated hereby. Each Seller and
any Affiliate of such Seller that employs a Retained Employee (an "Employer" and
collectively, "Employers") shall enter into an Employee Leasing Agreement with
Buyer pursuant to which such Employer shall agree to provide to Buyer the
services of the Retained Employees for purposes of ▇▇▇▇▇▇▇ one or more of the
Rigs. Such agreement shall provide, among other things, that (i) the term of
such agreement shall be for up to one year after the Closing Date, (ii) Buyer
shall bear all salary, insurance and benefit costs incurred by an Employer in
respect of any Retained Employee during the period such agreement is in effect
as to such Retained Employee, (iii) it is understood that Parent has made such
arrangement available to Buyer to provide an orderly transition, and Buyer shall
use its Best Efforts to engage its own personnel to replace Retained Employees,
from time
25
to time, as soon as reasonably practicable and (iv) Buyer shall indemnify and
hold harmless Parent and its Affiliates from and against any Claims arising in
favor of Buyer, any of its Affiliates or any of its employees and Parent shall
indemnify and hold harmless Buyer and its Affiliates from and against any Claims
arising in favor of any Retained Employee. The parties shall agree to a form of
Employee Leasing Agreement as soon as practicable after the date hereof and in
any event at least 10 days before the Closing Date.
(d) Buyer is not hereby, and at no time hereafter will be, adopting,
accepting or assuming any employee benefit plan or collective bargaining
agreement of Parent or any Employer relating to any of their employees or any
other agreement, trust, plan, fund or other arrangement of Parent or any
Employer that provides for employee benefits or perquisites (collectively,
"Employment Arrangements"), and Buyer shall have no liability or obligation
whatsoever under any Employment Arrangement to Parent or any Employer or to any
employees of Parent or any Employer, whether or not any of such employees are
offered employment by or become employees of Buyer. Buyer is not obligated to
replace any of the Employment Arrangements for any employee of any Employer who
becomes an employee of Buyer, nor is Buyer obligated to provide any such person
with any similar agreements, plans or arrangements.
11.2 NON-SOLICITATION OF CERTAIN EMPLOYEES.
(a) Buyer agrees that, for a period of two years from and after the
Closing Date, neither Buyer nor any of its Affiliates will, directly or
indirectly, solicit to employ (as an employee, consultant, independent
contractor or otherwise) any Retained Employee or any drilling superintendent or
rig manager of Parent or any Seller or any of their respective Affiliates, or
otherwise induce or attempt to persuade any such Retained Employee or drilling
superintendent or rig manager to leave such employment.
(b) Parent and Sellers agree that, for a period of two years after the
Closing Date, neither Parent nor Sellers, nor any of their Affiliates, will,
directly or indirectly, solicit to employ (as an employee, consultant,
independent contractor or otherwise) any employee of Buyer or any of its
Affiliates that has become an employee of Buyer or any of its Affiliates in
connection with the acquisition of the Rigs from Sellers, or any drilling
superintendent or rig manger of Buyer or any of its Affiliates, or otherwise
induce or attempt to persuade any such employee, drilling superintendent or rig
manager to leave such employment.
ARTICLE XII
TERMINATION
12.1 TERMINATION. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing:
(a) by mutual written consent of Buyer and Parent;
(b) by either Buyer or Parent, if there shall be any statute, rule or
regulation that makes consummation of the transactions contemplated hereby
illegal or otherwise prohibited or a Governmental Entity shall have issued an
order, decree or ruling or taken any other action permanently restraining,
enjoining or otherwise prohibiting the consummation of the transactions
26
contemplated hereby, and such order, decree, ruling or other action shall have
become final and nonappealable;
(c) by Buyer, if
(i) the Closing shall not have occurred by June 30, 1997 (provided
that the right to terminate this Agreement under this clause (i) shall not
be available to Buyer if Buyer's failure to fulfill any of its obligations
under this Agreement or its misrepresentation or breach of warranty
hereunder has been the sole cause thereof); or
(ii) there has been a material breach by any Seller of any covenant
or agreement, or a material inaccuracy of any representation or warranty
of any Seller, contained in this Agreement which has rendered the
satisfaction of any condition to the obligations of Buyer impossible and
such breach or inaccuracy has not been cured by any Seller within five
Business Days after Parent's receipt of notice thereof from Buyer, or
waived by Buyer.
(d) by Parent, if
(i) the Closing shall not have occurred by June 30, 1997 (provided
that the right to terminate this Agreement under this clause (i) shall not
be available to Parent if Sellers' failure to fulfill any of their
obligations under this Agreement or their misrepresentation or breach of
warranty hereunder has been the sole cause thereof); or
(ii) there has been a material breach by Buyer of any covenant or
agreement, or a material inaccuracy of any representation or warranty of
Buyer, contained in this Agreement which has rendered the satisfaction of
any condition to the obligations of Sellers impossible and such breach or
inaccuracy has not been cured by Buyer within five Business Days after
Buyer's receipt of notice thereof from any Seller, or waived by Parent; or
(iii) the Board of Directors of Parent shall have determined to
approve an Acquisition Proposal.
12.2 EFFECT OF TERMINATION. In the event of the termination of this
Agreement pursuant to Section 12.1 by Buyer or Parent, written notice thereof
shall forthwith be given to the other party specifying the provision hereof
pursuant to which such termination is made, and this Agreement shall become void
and have no effect, and there shall be no liability hereunder on the part of
Buyer, Parent or Sellers or any of their respective directors, officers,
employees, stockholders or representatives, except that (i) the agreements
contained in this Section 12.2 and in Article XIII and Sections 5.13, 6.6, 7.7,
10.1 and 10.3 shall survive the termination hereof; (ii) Parent shall have the
right to receive the Deposit to the extent permitted under Section 3.2, as
liquidated damages and not as a penalty; and (iii) in the event of termination
by Parent under Section 12.1(d)(iii) and an Acquisition Proposal is consummated
within one year after the date of this Agreement, then Parent shall promptly pay
to Buyer $15,000,000 as liquidated damages and not as a penalty. Nothing
contained in this Section 12.2 shall relieve any party from liability for
damages actually incurred (excluding consequential damages) for breach of any
27
covenant or agreement, or for the inaccuracy of any representation or warranty,
contained herein, except that a party receiving liquidated damages under this
agreement pursuant to Section 3.2 or the preceding sentence shall not be
entitled to recover any additional damages for any breach of this Agreement.
ARTICLE XIII
EXTENT AND SURVIVAL OF REPRESENTATIONS,
WARRANTIES, COVENANTS AND AGREEMENTS
13.1 SCOPE OF REPRESENTATIONS OF SELLERS.
(a) BUYER UNDERSTANDS AND AGREES THAT, OTHER THAN REPRESENTATIONS,
WARRANTIES, COVENANTS AND AGREEMENTS SET FORTH HEREIN AND ANY WARRANTIES OF OR
CONCERNING TITLE SET FORTH HEREIN OR IN ANY INSTRUMENT OF CONVEYANCE TO BE
EXECUTED AND DELIVERED PURSUANT TO THIS AGREEMENT, NEITHER PARENT NOT SELLERS
NOR ANYONE ACTING ON THEIR BEHALF, MAKE ANY EXPRESS OR IMPLIED REPRESENTATIONS
OR WARRANTIES WITH RESPECT TO THE ASSUMED LIABILITIES, THE RIGS, OR THE OTHER
PURCHASED ASSETS (CURRENT, FIXED, PERSONAL, REAL, TANGIBLE AND INTANGIBLE)
REFERRED TO HEREIN, INCLUDING BUT NOT LIMITED TO SEAWORTHINESS, CONDITION OR
WORKMANSHIP THEREOF, OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR
PATENT, CAPACITY, SUITABILITY, UTILITY, SALABILITY, AVAILABILITY,
COLLECTIBILITY, OPERATIONS, CONDITION, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, AND BUYER ACCEPTS SAID RIGS AND PURCHASED ASSETS ON AN "AS
IS, WHERE IS, WITH ALL FAULTS" BASIS.
(b) Parent and Sellers expressly disclaim, and Buyer accepts such
disclaimer, with respect to any and all obligations or liabilities for
representations and warranties, express or implied, contained in, or from
omissions from, any written or oral communications furnished by or on behalf of
Parent or Sellers (including without limitation, any representations or
warranties contained in or omissions from the confidential selling memorandum
furnished by ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co. Incorporated dated November 20, 1996,
relating to "Selected Mat Supported Jackup Rigs of Noble Drilling Corporation"),
other than those set forth in this Agreement or in any document, certificate or
other writing required to be furnished by Parent or Sellers pursuant hereto.
Buyer acknowledges and affirms that it will have had the opportunity to complete
its own independent investigation, inspection, analysis and evaluation of the
Purchased Assets, and that in making its decision to enter into this Agreement
and to consummate the transactions contemplated hereby it has relied solely on
its own independent investigation, inspection, analysis and evaluation of the
Purchased Assets and on the express representations and warranties by Parent and
Sellers made in Articles V and VI hereof as a basis for entering into this
Agreement, and that it has made all such reviews and inspections of the
foregoing as it has deemed necessary or appropriate.
13.2 INDEMNIFICATION BY PARENT. With respect only to the representations,
warranties, covenants and agreements made herein that, pursuant to Section 13.5,
shall survive after the Closing Date, Parent agrees to indemnify, defend and
hold Buyer and its Affiliates harmless
28
from, any losses, liabilities, claims, demands, damages (excluding consequential
damages), costs or expenses (including reasonable attorneys' fees) of every
kind, nature and description (collectively, "Claims") arising out of or
resulting from (i) any inaccuracy in or breach of any of the representations,
warranties, covenants or agreements made by Sellers herein; (ii) the operation,
ownership or use of the Purchased Assets prior to the Closing; (iii) any
Proceedings relating solely to facts that existed before the Closing, which
affect the ownership or operation by the Buyer or its Affiliates of the
Purchased Assets or results in any change in the Assumed Liabilities; (iv) any
Claim by any person who is an employee of the Parent or any of its Affiliates on
the date of this Agreement that relates solely to any employment of such
employee by Parent or any of its Affiliates prior to the Closing; or (v) any
Claim related to any of the matters set forth on Schedules 5.7(a) or 5.9;
provided, however, that Parent shall have no liability pursuant to this Section
13.2 for the first $200,000 of aggregate Claims incurred by Buyer (the "Buyer
Basket") and Parent shall be responsible only for such amounts or such Claims as
exceed the Buyer Basket; and provided further, however, that the aggregate of
all Claims for which Buyer is entitled to reimbursement hereunder shall not
exceed the Purchase Price.
13.3 INDEMNIFICATION BY BUYER. Subject to Section 13.5, Buyer hereby
agrees to indemnify, defend and hold Parent and Sellers and their Affiliates
harmless from any Claims arising out of or resulting from (i) any inaccuracy in
or breach of any of the representations, warranties, covenants or agreements
made by Buyer herein; or (ii) the operation, ownership or use of the Purchased
Assets after the Closing; provided, however, that Buyer shall have no liability
pursuant to this Section 13.3 for the first $200,000 of aggregate Claims
incurred by Parent and Sellers (the "Seller Basket") and Buyer shall be
responsible only for such amounts of such Claims as exceed the Seller Basket;
and provided further, however, that the aggregate of all Claims for which Parent
and Sellers are entitled to reimbursement hereunder shall not exceed the
Purchase Price.
13.4 INDEMNIFICATION PROCEDURE. Any party seeking information or
reimbursement for Claims hereunder (the "Indemnified Party") shall notify the
party from which such indemnification is sought (the "Indemnifying Party")
within 45 Business Days of the assertion of any Claim or discovery of any fact
(which fact has been brought to the attention of a responsible executive officer
of the Indemnified Party) upon which the Indemnified Party intends to base a
claim for indemnification or reimbursement hereunder. The failure of the
Indemnified Party so to notify the Indemnifying Party shall relieve the
Indemnifying Party from any liability under this Agreement to the Indemnifying
Party with respect to such claim for indemnification or reimbursement. In the
event of any claims for indemnification or reimbursement, the Indemnifying
Party, at its option, may assume (with legal counsel reasonably acceptable to
the Indemnified Party) the defense of any claim, demand, lawsuit or other
proceeding brought against the Indemnified Party, which claim, demand, lawsuit
or other proceeding may give rise to the indemnity or reimbursement obligation
of the Indemnifying Party hereunder, and may assert any defense of any party;
provided, however, that the Indemnified Party shall have the right at its own
expense to participate jointly with the Indemnifying Party in the defense of any
claim, demand, lawsuit or other proceeding in connection with which the
Indemnified Party claims indemnification or reimbursement hereunder.
Notwithstanding the right of the Indemnified Party so to participate, the
Indemnifying Party shall have the sole right to settle or otherwise dispose of
such claim, demand, lawsuit or other proceeding on such terms as the
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Indemnifying Party, in its sole discretion, shall deem appropriate with respect
to any issue involved in such claim, demand, lawsuit or other proceeding as to
which (i) the Indemnifying Party shall have acknowledged the obligation to
indemnify the Indemnified Party hereunder, or (ii) the Indemnified Party shall
have declined so to participate; provided, however, that no such Claim shall be
settled by the Indemnifying Party in any manner that could reasonably be
expected to have a material adverse effect on the business of the Indemnified
Party and its subsidiaries, taken as a whole, without the prior written consent
of the Indemnifying Party.
13.5 SURVIVAL. The representations, warranties, covenants and agreements
set forth in this Agreement and in any certificate or instrument delivered in
connection herewith shall terminate upon Closing, following which no party may
bring any action or present any claim for the inaccuracy or breach of such
representations, warranties, covenants or agreements, except that the
representations, warranties, covenants and agreements set forth in Sections 3.2,
3.4, 5.1, 5.2, 5.13, 6.1, 6.2, 6.6, 7.1, 7.2, 7.7, 10.1, 10.3 (last sentence
only), 10.4 (last sentence only), 10.5, 10.7, 10.9, 10.10, 10.11(b), 10.12,
10.14, 10.16, 10.17, 10.18 and 12.2 and Articles II, XI, XIII, XIV and XV and in
the General Assignment shall survive the Closing Date.
13.6 TAX BENEFITS; INSURANCE PROCEEDS. In determining the amount of any
Claim, for which any party is entitled to reimbursement under Article XIII of
this Agreement, the gross amount thereof will be reduced by any correlative net
tax benefit or insurance proceeds realized or to be realized by such party and
such correlative insurance benefit shall be net of any insurance premium that
becomes due as a result of such claim.
13.7 APPLICABILITY OF INDEMNIFICATION OBLIGATION. EACH OF THE AGREEMENTS
TO INDEMNIFY, DEFEND OR HOLD HARMLESS CONTAINED IN SECTION 13.2 OR 13.3 SHALL
APPLY IRRESPECTIVE OF WHETHER THE SUBJECT CLAIM IS BASED IN WHOLE OR IN PART
UPON THE SOLE OR CONTRIBUTORY NEGLIGENCE (WHETHER ACTIVE, PASSIVE OR GROSS),
BREACH OF WARRANTY, OR BREACH OR VIOLATION OF ANY DUTY IMPOSED BY ANY LAW OR
REGULATION, ON THE PART OF THE BENEFICIARY OF THE AGREEMENT, EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED IN THIS AGREEMENT.
ARTICLE XIV
PARENT GUARANTEE
Parent irrevocably and unconditionally guarantees as primary obligor the
due and punctual performance by Sellers of the agreements and obligations of
Sellers and the completeness and accuracy of the representations and warranties
made by Sellers, under this Agreement and all agreements and instruments to be
executed by Sellers hereunder, including, without limitation, Article XIII
INDEMNIFICATION, and the instruments of conveyance referred to in Section
4.3(b). This guaranty shall survive the Closing and any liquidation of any
Seller.
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ARTICLE XV
MISCELLANEOUS
15.1 NOTICES. All notices and other communications required or permitted
to be given or made hereunder by either party hereto shall be in writing and
shall be deemed to have been duly given if delivered personally or transmitted
by first class registered or certified mail, postage prepaid, return receipt
requested, or sent by prepaid overnight delivery service, or sent by cable,
telegram, telefax or telex, to the parties at the following addresses (or at
such other addresses as shall be specified by the parties by like notice):
If to Buyer:
Pride Petroleum Services, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇, Chairman and
Chief Executive Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
If to Parent or any Seller:
Noble Drilling Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Day, Chairman, President and
Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ & Knight, P.C.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Such notices, demands and other communications shall be effective (i) if
delivered personally or sent by courier service, upon actual receipt by the
intended receipt, (ii) if mailed, upon the earlier of five days after deposit in
the mail or the date of delivery as shown by the return receipt therefor, or
(iii) if sent by telecopy or facsimile transmission, when confirmation of
receipt is received.
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15.2 ENTIRE AGREEMENT. This Agreement, including the Schedules, Exhibits,
Annexes and other writings referred to herein or delivered pursuant hereto,
constitutes the entire agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings,
both written and oral, between the parties with respect to the subject matter
hereof.
15.3 AMENDMENTS AND WAIVER; RIGHTS AND REMEDIES. This Agreement may be
amended, superseded, cancelled, renewed or extended, and the terms hereof may be
waived, only by a written instrument signed by the parties or, in the case of a
waiver, by the party waiving compliance. No delay on the part of either party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any waiver on the part of either party of any such right,
power or privilege, or any single or partial exercise of any such right, power
or privilege, preclude any further exercise thereof or the exercise of any other
such right, power or privilege. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any party may
otherwise have at law or in equity. The rights and remedies of either party
based upon, arising out of or otherwise in respect of any inaccuracy in or
breach of any representation, warranty, covenant or agreement contained in this
Agreement shall in no way be limited by the fact that the act, omission,
occurrence or other state of facts upon which any claim of any such inaccuracy
or breach is based may also be the subject matter of any other representation,
warranty, covenant or agreement contained in this Agreement (or in any other
agreement between the parties) as to which there is no inaccuracy or breach.
15.4 GOVERNING LAW. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Texas, without regard to
the principles of conflicts of laws thereof.
15.5 BINDING EFFECT; ASSIGNMENT.
(a) This Agreement and all the provisions hereof shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns; provided, however, that neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by either of the
parties hereto (by operation of law or otherwise) without the prior written
consent of the other party, except as provided in subsection (b) below.
(b) (i) Parent and Sellers may upon notice to Buyer cause one or more of
Parent's wholly owned subsidiaries (direct or indirect) (a "Seller
Designee") to purchase any or all of the Purchased Assets from a Seller in
order to allow such Seller Designee to become a transferor of such
Purchased Assets hereunder; provided, however, that (y) each Seller
Designee shall be made a party to this Agreement at or prior to the
Closing and (z) no such designation shall relieve Parent or any Seller of
any of its duties, liabilities or obligations hereunder.
(ii) Buyer may upon notice to Parent and Sellers direct that title
to all or part of the Purchased Assets be taken in one or more of Buyer's
wholly owned subsidiaries (direct or indirect) (a "Buyer Designee");
provided, however, that (y) each Buyer Designee shall be made a party to
this Agreement at or prior to the Closing and (z) no
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such designation shall relieve Buyer of any of its duties, liabilities or
obligations hereunder.
15.6 COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
15.7 REFERENCES. All references in this Agreement to Articles, Sections
and other subdivisions refer to the Articles, Sections and other subdivisions of
this Agreement unless expressly provided otherwise. The words "this Agreement,"
"herein," "hereof," "hereby," "hereunder" and words of similar import refer to
this Agreement as a whole and not to any particular subdivision unless expressly
so limited.
15.8 SEVERABILITY OF PROVISIONS. If any provision of this Agreement is
held to be unenforceable, this Agreement shall be considered divisible and such
provision shall be deemed inoperative to the extent it is deemed unenforceable,
and in all other respects this Agreement shall remain in full force and effect;
provided, however, that if any such provision may be made enforceable by
limitation thereof, then such provision shall be deemed to be so limited and
shall be enforceable to the maximum extent permitted by applicable law.
15.9 GENDER. Pronouns in masculine, feminine and neuter genders shall be
construed to include any other gender, and words in the singular form shall be
construed to include the plural and vice versa, unless the context otherwise
requires.
15.10 DESCRIPTIVE HEADINGS. The descriptive headings herein are inserted
for convenience of reference only, do not constitute a part of this Agreement,
and shall not affect in any manner the meaning or interpretation of this
Agreement.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective officers hereunto duly authorized as of the date first above
written.
PRIDE PETROLEUM SERVICES, INC.
By:/s/▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇, Chairman and
Chief Executive Officer
NOBLE DRILLING CORPORATION
By:/s/▇▇▇▇▇ ▇. DAY
▇▇▇▇▇ ▇. Day, Chairman, President
and Chief Executive Officer
NOBLE DRILLING (U.S.) INC.
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
NOBLE OFFSHORE CORPORATION
By:/s/▇▇▇▇▇ ▇. DAY
▇▇▇▇▇ ▇. Day, President
NOBLE DRILLING (MEXICO) INC.
By:/s/▇▇▇▇▇ ▇. DAY
▇▇▇▇▇ ▇. Day, President
NN-1 LIMITED PARTNERSHIP
By Noble Drilling Corporation,
General Partner
By:/s/▇▇▇▇▇ ▇. DAY
▇▇▇▇▇ ▇. Day, Chairman, President
and Chief Executive Officer
34
INDEX TO SCHEDULES AND EXHIBITS
SCHEDULE
NUMBER DESCRIPTION
-------- -----------
2.1(a) Rigs (excluding the ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇)
2.1(c) Inventory
2.1(d)(ii) Permits
2.1(e)(i) Drilling Contracts
2.1(e)(ii) Other Contracts
2.5(b) Technical Records
3.4 Allocation of Purchase Price
5.6 Sellers' Defaults
5.7(a) Sellers' Litigation
5.7(b) Sellers' Governmental Notifications
5.8 Sellers' Governmental Approvals
5.9 Sellers' Compliance with Laws
5.11(b) Rig Class Recommendation
5.11(c) Rig Damage
5.15 Sellers' Performance Bonds; Letters of Credit
6.4 Parent's Governmental Approvals
7.6 Buyer's Governmental Approvals
EXHIBIT
NUMBER
-------
2.4 Form of Agreement Regarding Nonassigned Contracts
3.1(a) Form of Escrow Agreement
4.2(a) Form of General Assignment
8.3 Form of Buyer's Officer's Certificate
8.4 Buyer's Opinion of Counsel
9.3(a) Form of Sellers' Officer's Certificate
9.3(b) Form of Parent's Officer's Certificate
9.4 Parent's and Sellers' Opinion of Counsel
10.18 Form of Triton Contract
35