EXHIBIT 10z
CREDIT AGREEMENT
dated as of May 23, 2001
among
ROWAN COMPANIES, INC.
as Shipowner
GOVCO INCORPORATED
as Primary Lender
CITIBANK, N.A.
as Alternate Lender
CITIBANK INTERNATIONAL plc,
as Facility Agent
and
CITICORP NORTH AMERICA, INC.
as Administrative Agent for the Primary Lender and
the commercial paper holders of the Primary Lender.
TABLE OF CONTENTS
SECTION 1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION........................... 2
1.01 Defined Terms........................................................ 2
1.02 Principles of Construction........................................... 2
SECTION 2. THE CREDIT FACILITY.................................................. 2
2.01 Amount............................................................... 2
2.02 Availability......................................................... 3
2.03 Disbursements and Minimum Amount of Utilizations..................... 3
2.04 Relationship of Floating Rate Note and Fixed Rate Note............... 3
2.05 Trigger Event........................................................ 3
SECTION 3. DISBURSEMENT REQUIREMENTS............................................ 4
3.01 Disbursement Procedures.............................................. 4
SECTION 4. TERMS OF THE CREDIT.................................................. 4
4.01 Principal Repayment.................................................. 4
4.02 Interest Payment..................................................... 5
4.03 Prepayment........................................................... 6
4.04 Recapture............................................................ 8
4.05 Evidence of Debt..................................................... 8
4.06 Limit of United States Guarantee..................................... 9
SECTION 5. CONDITIONS PRECEDENT................................................. 9
5.01 Conditions Precedent to Lenders' Obligations Under this Agreement.... 9
5.02 Conditions Precedent to Each Disbursement............................ 10
SECTION 6. FEES AND EXPENSES.................................................... 10
6.01 Fees................................................................. 10
6.02 Taxes................................................................ 11
6.03 Expenses............................................................. 12
6.04 Additional or Increased Costs........................................ 12
SECTION 7. PAYMENTS............................................................. 13
7.01 Method of Payment.................................................... 13
7.02 Application of Payments.............................................. 15
SECTION 8. REPRESENTATIONS AND WARRANTIES BY THE SHIPOWNER...................... 15
8.01 Representations and Warranties of the Shipowner...................... 15
8.02 Agreements of the Shipowner.......................................... 17
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SECTION 9. CANCELLATION, SUSPENSION AND EVENTS OF DEFAULT....................... 19
9.01 Cancellation......................................................... 19
9.02 Events of Default.................................................... 19
SECTION 10. GOVERNING LAW AND JURISDICTION....................................... 20
10.01 Governing Law........................................................ 20
10.02 Submission to Jurisdiction........................................... 20
10.03 Waiver of Security Requirements...................................... 21
10.04 No Limitation........................................................ 21
SECTION 11. MISCELLANEOUS........................................................ 21
11.01 Computations......................................................... 21
11.02 Notices.............................................................. 21
11.03 Disposition of Indebtedness.......................................... 23
11.04 Disclaimer........................................................... 23
11.05 No Waiver; Remedies Cumulative....................................... 23
11.06 Currency............................................................. 24
11.07 Severability......................................................... 24
11.08 Amendment or Waiver.................................................. 24
11.09 Indemnification...................................................... 24
11.10 Benefit of Agreement................................................. 25
11.11 Waiver of Jury Trial................................................. 25
11.12 Execution in Counterparts............................................ 25
11.13 Shipowner Documents.................................................. 25
11.14 Entire Agreement..................................................... 26
11.15 No Proceedings....................................................... 26
SECTION 12. ARRANGEMENTS AMONG THE AGENTS AND THE LENDERS........................ 26
12.01 Appointment.......................................................... 26
12.02 Rights of Facility Agent............................................. 26
12.03 Duties............................................................... 27
12.04 Limitation on Obligations of Facility Agent.......................... 27
12.05 Indemnification by Lenders........................................... 28
12.06 Limitation on Responsibility......................................... 28
12.07 No Claims on Employees of Facility Agent............................. 28
12.08 Banking Business..................................................... 28
12.09 Resignation or Termination of Facility Agent......................... 29
12.10 Successor to Facility Agent.......................................... 29
12.11 Discharge of Obligations............................................. 29
12.12 Responsibilities of Lenders.......................................... 29
12.13 Agency Division...................................................... 30
12.14 Administrative Agent................................................. 30
12.15 Facility Agent Only Agent for the Lenders........................... 30
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Exhibits
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Exhibit 1 Schedule of Definitions
Annexes
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Annex A Form of Disbursement Requests
iii
THIS CREDIT AGREEMENT, dated as of May 23, 2001 is made by and among ROWAN
COMPANIES, INC., a Delaware corporation (the "Shipowner"), GOVCO INCORPORATED, a
Delaware corporation (the "Primary Lender"), CITIBANK, N.A., a national banking
association (the "Alternate Lender"), CITIBANK INTERNATIONAL plc, a bank
organized and existing under the laws of England, as facility agent for both the
Primary Lender and the Alternate Lender (and their respective successors and
assigns) with respect to the Floating Rate Note, and its permitted successors
and assigns (in such capacity, the "Facility Agent"), and CITICORP NORTH
AMERICA, INC., a Delaware corporation, as administrative agent for the Primary
Lender and the commercial paper holders of the Primary Lender (and their
respective successors and assigns) (in such capacity, together with its
permitted successors and assigns, the "Administrative Agent," and together with
the Facility Agent, the "Agents"). As used herein, the term "Lender" shall mean
either the Primary Lender or the Alternate Lender, as the case may be, depending
on which of the two parties made or will make the relevant disbursement of funds
under this Agreement; provided, however, that if the Primary Lender assigns its
rights under this Agreement to the Alternate Lender, the term "Lender," as used
herein, shall mean only the Alternate Lender. The term "Lenders," as used
herein, shall mean collectively the Primary Lender and the Alternate Lender.
BACKGROUND
WHEREAS:
(A) by this Agreement, the Lenders have established a credit facility (the
"Credit Facility") in the amount of $187,295,000, pursuant to which the Primary
Lender may, in its discretion, subject to the terms and conditions hereof,
extend financing to the Shipowner (i) for the manufacture, construction,
fabrication, financing and purchase by the Shipowner of the Vessel; (ii) for the
payment of the related Construction Period Interest; and (iii) for the payment
of the Guarantee Fees; and if the Primary Lender chooses at any time not to
extend, or continue to extend, any such financing, then the Alternate Lender
shall, subject to the terms and conditions hereof, extend the undisbursed
portion of such financing;
(B) the establishment of the Credit Facility is in reliance upon the
commitment of the United States to guarantee the payment of the unpaid interest
on, and the unpaid balance of the principal of, the Floating Rate Note,
including interest accruing between the date of an Indenture Default under the
Floating Rate Note and the payment in full of the Guarantee;
(C) a condition to the Lenders' extension of the Credit Facility under
this Agreement is the Facility Agent's timely receipt of Certificates
Authorizing Disbursement and issuance of the Guarantee of the Floating Rate
Note;
(D) the Facility Agent will serve as facility agent for the benefit, and
on behalf, of each of the Lenders in connection with the Credit Facility, this
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Agreement and the other related documents and the Administrative Agent will act
as an administrative agent for the Primary Lender and the Primary Lender's
commercial paper holders; and
(E) the Credit Facility may be utilized by the Shipowner in accordance
with the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND PRINCIPLES OF CONSTRUCTION
1.01 Defined Terms. For the purposes of this Agreement, unless otherwise
defined herein, defined terms shall have the meanings specified in Exhibit 1
hereto.
1.02 Principles of Construction.
(a) The meanings set forth for defined terms in this Agreement shall be
equally applicable to both the singular and plural forms of the terms defined.
(b) Unless otherwise specified, all references in this Agreement to
Annexes or Exhibits are to Annexes or Exhibits in or to this Agreement.
(c) The headings of the Sections in this Agreement are included for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.
SECTION 2. THE CREDIT FACILITY
2.01 Amount. The Lenders hereby establish the Credit Facility, upon the
terms and conditions set forth in this Agreement, in favor of the Shipowner in
the maximum amount of $187,295,000 (the "Credit Facility Amount"), to enable the
Shipowner to finance: (i) the manufacture, construction, fabrication, financing
and purchase of the Vessel; (ii) Construction Period Interest; and (iii) the
Guarantee Fees; all as set forth in Certificates Authorizing Disbursements
submitted in accordance with this Agreement. The Primary Lender intends (but is
not obligated) to fund the Credit Facility through the issuance and sale of
Commercial Paper to investors which is exempt from the registration requirements
of the United States Securities Act of 1933, as amended. The Primary Lender may,
at its option, elect at any time not to fund the Credit Facility or the
undisbursed portion thereof, in which case the Alternate Lender will, subject to
the terms and conditions provided herein, be obligated to fund under the Credit
Facility the amount (the "Available Amount") which is equal to the excess, if
any, of the Credit Facility Amount over the outstanding principal amount
evidenced by the Floating Rate Note, plus the aggregate outstanding principal
amount evidenced by Fixed Rate Notes ("Outstanding Principal").
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2.02 Availability. Disbursements under the Credit Facility may be made
once a calendar month and up to and including the Final Disbursement Date.
"Final Disbursement Date" shall mean the earliest of (x) December 31, 2003, (y)
upon the request of the Secretary, the date upon which the Trigger Event (as
defined in Section 2.05) shall occur or, (z) the date on which the Available
Amount under the Credit Facility is canceled in accordance with Section 9.01 or
reduced to zero.
2.03 Disbursements and Minimum Amount of Utilizations. Upon satisfaction
of Sections 3.01, 5.01 and 5.02, disbursements shall be made by advances from
the Primary Lender or the Alternate Lender to the Shipowner ("Disbursements") in
accordance with Section 3.01. Notwithstanding anything in this Agreement to the
contrary, the Shipowner may not request a Disbursement under the Credit Facility
for an amount (a) less than the smaller of (i) $1,000,000 or (ii) the Available
Amount or (b) more than the Available Amount.
2.04 Relationship of Floating Rate Note and Fixed Rate Note. Disbursements
from the Credit Facility shall become the indebtedness of the Shipowner to the
Lenders under the Floating Rate Note. The Shipowner shall redeem the Floating
Rate Note in full by causing to be issued one or more Fixed Rate Notes and using
the proceeds thereof to repay the Floating Rate Note in full no later than the
earliest of (i) four years from the Delivery Date, (ii) January 15, 2008, or
(iii) at the request of the Secretary, within fifteen (15) Business Days from
the date upon which the Trigger Event shall occur. At its option, and from time
to time, the Shipowner may redeem all or any portion of the indebtedness under
the Floating Rate Note by causing a Fixed Rate Note or series of Fixed Rate
Notes to be issued at any time during or after the construction of the Vessel,
so long as such redemption of the Floating Rate Note from the proceeds of Fixed
Rate Note(s) does not occur later than the earliest of (i) four years after the
Delivery Date, (ii) January 15, 2008, or (iii) at the request of the Secretary,
within fifteen (15) Business Days from the date upon which the Trigger Event
shall occur, and except for the final redemption or in the case of the Trigger
Event, each redemption is in a minimum amount of $50,000,000; and the Shipowner
shall have paid any amount payable under Section 4.04(a)(iv) or any other
provision hereof in connection therewith.
2.05 Trigger Event. (a) The Shipowner shall redeem the outstanding
indebtedness under the Floating Rate Note in full by causing to be issued a
fixed rate obligation with a Maturity date of July 15, 2021 whenever the
Treasury constant maturities rate (10-year) as reported by the Federal Reserve
Board in statistical release H.15 (519) (the "Treasury Rate") equals or exceeds
nine percent (9%) per annum (the "Trigger Event"). If a Trigger Event should
occur, the Shipowner shall redeem the Floating Rate Note in full by causing to
be issued a fixed rate obligation and using the proceeds thereof to repay the
Floating Rate Note in full, at the request of the Secretary, within fifteen (15)
Business Days of receiving notice of the occurrence of the Trigger Event,
pursuant to Section 2.05(d) or of having actual notice thereof.
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(b) Nothing in this Section 2.05 shall prevent the Shipowner from
redeeming the Floating Rate Note by issuance of a fixed-rate obligation at any
time prior to Maturity.
(c) The failure of the Shipowner to redeem the Floating Rate Note by
issuance of a fixed-rate obligation within fifteen (15) Business Days of
receiving notice of the occurrence of the Trigger Event pursuant to Section
2.05(d) or of having actual notice thereof, unless subsequently waived in
writing by the Secretary, shall constitute an Indenture Default without further
notice to the Shipowner or the Lenders being required under the Indenture or
this Agreement.
(d) The Shipowner covenants for the benefit of the Secretary that it shall
arrange for an independent reporting service or bank acceptable to the Secretary
to send the Secretary, the Facility Agent, and the Shipowner a written interest
rate report once a month on the first business day of every month (until such
time as the Floating Rate Note is redeemed in full). This interest rate report
shall specify the Treasury Rate as of the date of the report.
SECTION 3. DISBURSEMENT REQUIREMENTS
3.01 Disbursement Procedures. Upon receipt by the Facility Agent of each
Certificate Authorizing Disbursement at least five (5) Business Days prior to
the proposed disbursement date, the Primary Lender may, and if the Primary
Lender elects not to, the Alternate Lender shall, disburse funds in accordance
with the terms of such Certificate Authorizing Disbursement to the Shipowner, or
the Shipowner's designee, subject to the terms of this Agreement and such
Certificate Authorizing Disbursement; provided that, if the Certificate
Authorizing Disbursement and the request for disbursement referred to therein do
not specify a disbursement date, then the disbursement date shall be the fifth
Business Day (or such earlier or later Business Day as is requested by the
Shipowner and is acceptable to the disbursing Lender) following the Facility
Agent's receipt of such Certificate Authorizing Disbursement. Promptly following
each Disbursement, the Facility Agent shall transmit to the Indenture Trustee a
copy of the Certificate Authorizing Disbursement, a confirmation that the
Disbursement was made, and a copy of Exhibit A to the Floating Rate Note,
updated to reflect such Disbursement and other intervening, related events.
SECTION 4. TERMS OF THE CREDIT
4.01 Principal Repayment. The Shipowner shall repay the Outstanding
Principal of the Floating Rate Note as follows:
(i) in installments in the principal amount of $5,203,000, on each
Payment Date commencing on January 15, 2004, and continuing
until July 15, 2007, and
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(ii) the full amount of the Outstanding Principal evidenced by the
Floating Rate Note, on the earliest of (i) four years from the
Delivery Date, (ii) January 15, 2008, or (iii) at the request
of the Secretary, within fifteen (15) Business Days from the
date upon which the Trigger Event shall occur.
4.02 Interest Payment.
(a) On each Interest Payment Date, the Shipowner shall pay to the
Indenture Trustee, on behalf of the Person(s) entitled thereto, interest on the
Outstanding Principal of the Floating Rate Note, calculated at an interest rate
per annum equal to the Applicable Interest Rate therefor, as determined for each
successive Interest Period. The Indenture Trustee shall calculate the Applicable
Interest Rate based on information provided (i) by the Administrative Agent to
the Facility Agent if the Primary Lender is the Lender, or (ii) by the Facility
Agent if the Alternate Lender is the Lender. From time to time, the
Administrative Agent or Facility Agent will confirm CP Rate, LIBOR, Base Rate,
and Applicable Interest Rate to the Indenture Trustee. In the event that the
Primary Lender assigns the financing of all or any portion of the amount
outstanding under the Credit Facility (whether or not evidenced by a Note) to
the Alternate Lender or other assignee permitted by the terms of this Agreement,
the interest rate on such amount shall be determined by the Facility Agent (and
the Facility Agent shall notify the Indenture Trustee thereof and the Indenture
Trustee shall recalculate such interest rate based on information provided by
the Facility Agent) pursuant to clause (i) of the definition of Applicable
Interest Rate for the period prior to the effective date of such assignment and
pursuant to clause (ii) of such definition for all periods after such date.
(b) The Shipowner shall pay to the Facility Agent, on behalf of the
Person(s) entitled to any Unpaid Amount, on demand, interest on such Unpaid
Amount (to the extent permitted by applicable law) for each Post Maturity Period
at an interest rate per annum equal to the sum (the "Post Maturity Interest
Rate") of (1) two percent (2%), plus (2) the Post Maturity Applicable Interest
Rate. With respect to any Unpaid Amounts, the "Post Maturity Applicable Interest
Rate" shall mean either (i) LIBOR on the Quotation Date therefor plus two tenths
of one percent (0.20%) per annum, or (ii) for any such Post Maturity Period
LIBOR cannot be determined the rate per annum reasonably determined by the
Person to whom such Unpaid Amount is owed before the last day of such Post
Maturity Period to be that which expresses as a percentage rate per annum the
cost which such Person would incur in funding such Unpaid Amount from whatever
source it reasonably deems appropriate for such Post Maturity Period plus two
tenths of one percent (0.20%) per annum, or (iii) if any such Unpaid Amount is
an Accelerated Repayment, then during the first Post Maturity Period the rate
which would have been applicable to such Unpaid Amount had it not so fallen due.
In the absence of an Indenture Default, any interest which shall have accrued
under this Section 4.02(b) in respect of an Unpaid Amount shall be due and
payable and shall be paid by the
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Shipowner on demand on such dates as the Person to whom such Unpaid Amount is
owed may specify by written notice to the Shipowner, or if there is an Indenture
Default, any interest which shall have accrued under this Section 4.02(b) in
respect of an Unpaid Amount shall be due and payable immediately and shall be
paid by the Shipowner without demand and any payment by, or on behalf of, the
Shipowner hereunder shall be governed by Section 7.02 and the provisions of the
last paragraph of Section 9.02.
As used herein, "Unpaid Amount" means all or any part of principal,
accrued interest, fees or other amounts owing to the Lenders under this
Agreement or the Floating Rate Note which is not paid in full when and as due
and payable, whether at Stated Maturity, by acceleration or otherwise, or any
sum due and payable by the Shipowner to the Lenders under any judgment of any
court or arbitral tribunal in connection with this Agreement which is not paid
on the date of such judgment; provided, however, that it is agreed that Unpaid
Amount shall not include any part of the principal and interest on the Floating
Rate Note, except that Unpaid Amount shall include all such amounts thereof as
are not paid by the Shipowner as and when they are due but are paid by the
Shipowner prior to payment thereof by the Secretary. "LIBOR" shall mean, in
relation to any Post Maturity Period (other than the first Post Maturity Period
contemplated by clause (iii) of Section 4.02(b)), the rate of interest per annum
(rounded upward, if necessary, to the nearest 1/16 of 1%) last quoted by the
principal London office of CITIBANK, N.A., prior to the close of business at
such London office on the Quotation Date for the offering to leading banks in
the London interbank market of U.S. Dollar deposits on an overnight basis and in
an amount comparable to the Unpaid Amount to which LIBOR is to apply.
"Accelerated Repayment" shall mean any part of the principal of the Floating
Rate Note that became due and payable on a day other than its Payment Date.
"Post Maturity Period" shall mean with respect to the period from the date an
Unpaid Amount was due until such amount shall have been paid in full, each
successive period, the first of which shall start on the date such Unpaid Amount
was due (or the date of any such judgment or arbitral award, if earlier) and
each other of which shall start on the last day of the preceding such period,
and the duration of each of which shall be one day, or if LIBOR applies, then
from and including the Quotation Date for such Post Maturity Period to but
excluding the next Quotation Date or such other duration selected by the Person
to whom such Unpaid Amount is due; provided, however, that in the case of any
Accelerated Repayment, the first such Post Maturity Period applicable thereto
shall be of a duration equal to the unexpired portion of its then applicable
Interest Period. "Quotation Date" in relation to any Post Maturity Period means
the day on which quotations would ordinarily be given by CITIBANK, N.A. in the
London interbank market for dollar deposits for delivery on the first day of
that period; provided, however, that if, for any such Post Maturity Period,
quotations would ordinarily be given on more than one date, the Quotation Date
for that period shall be the last of those dates.
4.03 Prepayment. (a) The Shipowner may from time to time prepay on any
Interest Payment Date all or any part of the Outstanding Principal evidenced by
the Floating Rate Note, provided that: (i) any partial prepayment
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shall be in a minimum principal amount of $10,000,000, unless otherwise required
by the Indenture; (ii) the Shipowner shall have given the Facility Agent and the
Indenture Trustee prior written notice of such prepayment (which shall be not
less than 40 nor more than 60 days); (iii) the Shipowner shall have paid in full
all amounts due under this Agreement as of the date of such prepayment,
including, without limitation, interest which has accrued to the date of
prepayment on the amount prepaid and all other amounts payable hereunder
relating to such prepayment; (iv) any amount prepaid hereunder (other than the
Outstanding Principal amount thereof prepaid through the issuance of Fixed Rate
Notes, the Outstanding Principal amount of which is subtracted from the Credit
Facility pursuant to the last sentence of Section 2.01) shall not be considered
part of the Available Amount; and (v) subject to Section 4.03(c), if the Lender
is the Primary Lender, the Shipowner shall pay to the Facility Agent, for the
benefit of the Primary Lender an amount equal to (x) the amount of yield that
the Primary Lender is required to pay to holders of its Commercial Paper during
the Liquidation Period (as defined below) on an amount of Commercial Paper
having an aggregate issue price equal to the amount of the Shipowner's
prepayment less (y) the amount of the estimated investment earnings, as
determined by the Facility Agent, on the prepayment amount during the
Liquidation Period. The "Liquidation Period" means the period from the date on
which a prepayment is made to the earliest date on which the Primary Lender's
total amount of Commercial Paper related to the funding of the Disbursements can
be reduced (without prepayment thereof) by an amount equal to the amount of the
Shipowner's prepayment. Prepayments shall be applied to the installments of
principal of the Credit Facility in the inverse order of their maturity, and, in
cases where more than one Note is outstanding, pro rata to each Note.
(b) Upon delivery to the Shipowner and the Secretary of the instrument
satisfying and discharging the Indenture contemplated by Section 12.01 of the
Exhibit 1 to the Indenture, all of the Shipowner's indebtedness, liabilities and
obligations under this Agreement and the Fee Letter shall become immediately due
and payable without demand upon, or notice to, the Shipowner.
(c) Notwithstanding any other provision to the contrary herein, the
Shipowner or the Secretary (after the Secretary's assumption of the Floating
Rate Note pursuant to Section 6.09 of Exhibit 1 to the Indenture) may from time
to time prepay all or any part of the principal amount of the Floating Rate Note
without any prepayment penalty or premium in accordance with Article III of
Exhibit 1 to the Indenture.
(d) Notwithstanding any other provision to the contrary herein, the
Shipowner shall have the right to prepay any portion of the Floating Rate Note
and redeem the Floating Rate Note by issuing a Fixed Rate Note and using the
proceeds thereof to prepay the Floating Rate Note so long as it first obtains
the Secretary's consent to the interest rate applicable to the Fixed Rate Note
and, except for the final disbursement, the principal amount of such redemption
equals or exceeds $50,000,000; and the Shipowner shall have paid any amount
payable under Section 4.04(a)(iv) or any other provision hereof in connection
therewith.
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4.04 Recapture. (a) Upon the written request of the Facility Agent, the
Shipowner shall pay to the applicable Lender, such amounts as shall be
sufficient (in the reasonable judgment of such Lender) to compensate such Lender
for any loss, expense or liability (including, without limitation, any loss,
expense or liability incurred by reason of the liquidation or redeployment of
deposits from third parties or in connection with obtaining funds to make or
maintain any Disbursement) which such Lender reasonably determines is
attributable to:
(i) any failure to make scheduled payments on a Payment Date or any
payment due in connection with any Redemption; or
(ii) any failure by the Shipowner to borrow any advance for which a
Certificate Authorizing Disbursement has been issued; or
(iii) any revocation of a notice of prepayment given pursuant to Section
4.03(a); or
(iv) subject to the provisions of Section 4.03(c), any prepayment of the
Floating Rate Note (including, without limitation, due to the issuance of any
fixed rate notes) other than on an Interest Payment Date after giving five
Business Days prior written notice to such Lender, the Facility Agent, and the
Indenture Trustee.
(b) Without prejudice to any other provision hereof (and at the
Shipowner's expense), such Lender shall use such reasonable efforts as it shall
determine in its sole discretion to minimize any loss, expense or liability to
the extent possible.
(c) With respect to the Shipowner's obligations under Section 4.04(a)(iv),
if the Shipowner shall at any time notify the Facility Agent and the applicable
Lender of its intention to pursue any such prepayment, the Facility Agent and
the applicable Lender shall reasonably cooperate with the Shipowner in assessing
and quantifying any loss, expense or liability the Lender may incur in
connection with a prepayment under the circumstances described in Section
4.04(a)(iv), so that the Shipowner may make an informed decision as to the cost
to it of any such prepayment. Any information provided to the Shipowner by the
Lender pursuant to this Section 4.04(c) is understood by the parties to be an
estimate of the costs of prepayment only and shall not be binding in the
determination of such costs pursuant to Section 4.04(a)(iv).
4.05 Evidence of Debt. The Shipowner agrees that to evidence further its
obligation to repay all amounts disbursed under the Credit Facility, with
interest accrued thereon, it shall issue and deliver to the Facility Agent, in
accordance with the written instructions of the Facility Agent, the Floating
Rate Note. The Floating Rate Note shall (i) be in the form of Exhibit 2 to the
Indenture; (ii) bear the Secretary's Guarantee, and (iii) be valid and
enforceable as to its principal amount at any time only to the extent of the
aggregate amounts then disbursed and outstanding thereunder, and, as to
interest, only
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to the extent of the interest accrued thereon at the rate guaranteed by the
Secretary, with any interest in excess thereof being evidenced by this
Agreement.
4.06 Limit of United States Guarantee. None of the incremental amount of
interest required to be paid under Section 4.02(b), none of the fees, and
expenses arising under Sections 4.03, 4.04 and 6, and none of the Indemnified
Amounts, commissions, Taxes, Other Taxes, Post Maturity Interest Rate, interest
in excess of 10.25% (or such higher rate as may be agreed from time to time by
the Secretary) (the "Cap Rate") under the Floating Rate Note, the costs of
obtaining any interest rate protection, or any other charges, costs, expenses,
or indebtedness owed by the Shipowner under this Agreement to any Person is
guaranteed by the United States. The Guarantee of the United States extends only
to the principal and interest owed under the Obligations and only to the extent
specified therein. The Cap Rate shall not apply to fixed-rate obligations.
SECTION 5. CONDITIONS PRECEDENT
5.01 Conditions Precedent to Lenders' Obligations Under this Agreement.
The obligations of the Lenders under this Agreement shall be subject to the
delivery to the Facility Agent of the documents indicated below on or before the
Closing Date:
(a) This Agreement, the Floating Rate Note and the Fee Letter. This
Agreement and the Fee Letter, each fully executed by the parties thereto
in form and substance satisfactory to the Lenders, which shall be in full
force and effect and the Floating Rate Note shall have been fully executed
by the Shipowner, endorsed by, or on behalf of, the United States, and
delivered to the Facility Agent, and all amounts then payable under the
Fee Letter shall have been paid to the Person entitled thereto.
(b) Existence. Evidence in form and substance satisfactory to the
Lenders, that the Shipowner is duly organized, validly existing and in
good standing under the laws of the State of Delaware, with full power,
authority and legal right to own its property and to carry on its business
as now conducted.
(c) Authority. Evidence in form and substance satisfactory to the
Lenders, of the authority of the Shipowner to execute, deliver, perform
and observe the terms and conditions of this Agreement, the Floating Rate
Note, the Fee Letter, and the Indenture and evidence of authority
(including specimen signatures) for each Person who, on behalf of the
Shipowner, signed this Agreement, the Floating Rate Note, the Fee Letter,
and the Indenture, or will otherwise act as representatives of the
Shipowner in the operation of the Credit Facility.
(d) Governmental and Other Authorizations. Copies, certified as true
copies by a duly authorized officer of the Shipowner, of each consent,
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license, authorization or approval of, and exemption by, any Governmental
Authority and any governmental authorities within the United States or
elsewhere, which are necessary or advisable (i) for the execution,
delivery, performance and observance by the Shipowner of this Agreement,
the Floating Rate Note, the Fee Letter, and the Indenture; and (ii) for
the validity, binding effect and enforceability of this Agreement, the
Floating Rate Note, the Fee Letter, and the Indenture, or if none is
necessary, a written certification from the Shipowner that none is
necessary.
(e) Legal Opinions. (1) Opinion of legal counsel for the Shipowner
concerning this Agreement, the Floating Rate Note, the Fee Letter, and the
Indenture; (2) Opinion of the Chief Counsel of the Maritime Administration
dated the Closing Date, signed by or on behalf of such Chief Counsel,
addressed to the Lenders and the Agents to the effect that the Guarantees
and the Authorization Agreement have been or will be duly authorized,
executed and delivered by the United States of America, and constitute
legal, valid, and binding obligations of the United States of America
enforceable in accordance with their respective terms; and (3) Opinion of
Xxxxx, Xxxxx & Xxxxx addressed to the Lenders, the Agents, and the
Indenture Trustee concerning this Agreement, the Fee Letter, the Indenture
and the Floating Rate Note.
(f) Guarantee Commitment. A copy of the fully executed Guarantee
Commitment, which shall be in full force and effect until completion of
the Closing.
(g) Authorization Agreement. The fully executed Authorization
Agreement, which shall be in full force and effect.
(h) Indenture. The fully executed Indenture, which shall be in full
force and effect.
5.02 Conditions Precedent to Each Disbursement. The agreement of the
Primary Lender to fund any Disbursement under this Agreement and any obligations
of the Alternate Lender to fund any Disbursement under this Agreement shall be
subject only to the Facility Agent's receipt of a Certificate Authorizing
Disbursement, upon which each such Lender may conclusively rely.
SECTION 6. FEES AND EXPENSES
6.01 Fees. The Shipowner shall pay or cause to be paid to the Person
entitled thereto such fees and other amounts as are set forth in that certain
Fee Letter (as amended, restated or otherwise modified from time to time, the
"Fee Letter") dated as of May 23, 2001 between the Shipowner and the Agents, in
each case when and as due.
10
6.02 Taxes.
(a) The Shipowner agrees to pay all amounts owing by it under this
Agreement or the Floating Rate Note free and clear of and without deduction for
any and all present and future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding in the case of
each Lender, taxes imposed on its income, and franchise taxes imposed on it in
lieu of income taxes, by either (i) the jurisdiction under the laws of which
such Lender is organized or any political subdivision thereof, or (ii) the
jurisdiction of such Lender's applicable lending office or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings, and liabilities being hereinafter referred to as
"Taxes"). In addition, the Shipowner agrees to pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under the Floating Rate
Note or from the execution, delivery, or registration of, or otherwise with
respect to, this Agreement or the Floating Rate Note (hereinafter referred to as
"Other Taxes").
(b) The Shipowner further agrees:
(i) that, if the Shipowner is prevented by operation of law from paying
any such Taxes or Other Taxes, or if any such Taxes or Other Taxes are required
to be deducted or withheld, then the fees or expenses required to be paid under
this Agreement shall, on an after-tax basis, be increased by the amount
necessary to yield to the Lenders fees or expenses in the amounts provided for
in this Agreement after the provision for the payment of all such Taxes and
Other Taxes;
(ii) that the Shipowner shall, at the request of any Lender or any Agent,
execute and deliver to such Lender or Agent, as the case may be, such further
instruments as may be necessary or desirable to effect the payment of the
increased amounts as provided for in subsection (i) above; provided, however,
that the Shipowner may not amend the Floating Rate Note without the prior
written consent of the Secretary;
(iii) that the Shipowner shall hold the Lenders harmless from and against
the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this
Section 6.02) and any and all liabilities (including, without limitation,
penalties, interest and expenses) arising from, or with respect to, any Taxes or
Other Taxes (whether or not properly or legally asserted) and whether paid, or
payable, by the Shipowner, the Lenders, or any other Person;
(iv) that, at the request of any Lender or any Agent, the Shipowner shall
provide such Lender or Agent within the later of thirty (30) calendar days after
such request or thirty (30) calendar days after the payment of such Taxes or
Other Taxes, a copy evidencing the payment of any Taxes or Other Taxes by the
Shipowner; and
11
(v) that each payment under this Section 6.02 shall be made within thirty
(30) days from the date the Facility Agent on behalf of the applicable Lender
makes written demand therefor. Each demand for payment by such Lender under
Section 6.02(b)(v) for amounts paid or incurred by the Lenders or itself shall
be accompanied by a certificate (with accompanying documentation supporting the
demand) showing in reasonable detail the basis for the calculation of the
amounts demanded, which certificate, in the absence of manifest error, shall be
conclusive and binding for all purposes.
Notwithstanding anything to the contrary contained herein, the agreements
in this Section 6.02 shall survive the termination of this Agreement and the
payment of the Floating Rate Note and all other amounts due hereunder.
6.03 Expenses. The Shipowner agrees, whether or not the transactions
hereby contemplated shall be consummated, to pay, or reimburse the Agents and
the Lenders, respectively, promptly upon demand for the payment of all
reasonable and duly documented costs and expenses arising in connection with the
preparation, printing, execution, delivery, registration, implementation,
modification of or waiver or consent under this Agreement, the Floating Rate
Note or the Indenture, including, without limitation, the reasonable and duly
documented out-of-pocket expenses of the Agents and the Lenders (incurred in
respect of telecommunications, mail or courier service, travel and the like),
and the fees and expenses of counsel for the Agents and the Lenders. The
Shipowner shall also pay all of the costs and expenses (including, without
limitation, the fees and expenses of counsel) incurred by or charged to the
Agents or the Lenders in connection with the amendment or enforcement of this
Agreement, the Floating Rate Note or the Indenture or the protection or
preservation of any right or claim of the Agents or the Lenders arising out of
this Agreement, the Floating Rate Note or the Indenture.
6.04 Additional or Increased Costs.
(a) If, due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation, or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
cost to any Lender of agreeing to make or making, funding or maintaining the
Disbursements or the Credit Facility, then the Shipowner shall from time to
time, upon demand by such Lender, pay to such Lender additional amounts
sufficient to compensate such Lender for such increased cost.
(b) If any Lender determines that compliance with any law or regulation or
any guideline or request from any central bank or other governmental authority
(whether or not having the force of law) affects or would affect the amount of
capital required to be maintained by such Lender or any corporation controlling
such Lender and that the amount of such capital is increased by or based upon
the existence of such Lender's commitment to lend hereunder and other
commitments of this type, then, upon demand by such Lender, the Shipowner shall
immediately pay to the Facility Agent (for the
12
benefit of such Lender), from time to time as specified by the Facility Agent
(on behalf of such Lender), additional amounts sufficient to compensate such
Lender or such corporation in the light of such circumstances, to the extent
that such Lender reasonably determines such increase in capital to be allocable
to the existence of its commitment to lend hereunder.
(c) Each Lender shall take such reasonable steps as it shall determine to
minimize amounts demanded under this Section 6.04; provided that no Lender shall
be obligated to take any actions under this Section 6.04 if such Lender has
determined, that such actions would cause it to incur any material costs or
expenses or would otherwise be disadvantageous to it in any material respect. In
the event that a Lender transfers the booking office of the Credit Facility or
the Floating Rate Note to minimize amounts demanded under this Section 6.04, any
costs and expenses incurred in such transfer shall be paid by the Shipowner on
demand by such Lender.
(d) Each demand for payment by the Facility Agent (on behalf of any
Lender) under this Section 6.04 shall be accompanied by a certificate showing in
reasonable detail the basis for the calculation of the amounts demanded, which
certificate, in the absence of manifest error, shall be conclusive and binding
for all purposes.
(e) The Facility Agent on behalf of each Lender shall notify the Shipowner
of any event occurring after the date of this Agreement which entitles such
Lender to compensation pursuant to this Section 6.04, as promptly as
practicable, and in any event within ninety (90) days after it has knowledge of
such event and has determined that a request for compensation hereunder shall be
made. The Shipowner shall not be obligated to reimburse any Lender for any loss
or cost incurred more than ninety (90) days prior to delivery of notice to the
Shipowner by the Lender requesting compensation under this Section 6.04.
SECTION 7. PAYMENTS
7.01 Method of Payment.
(a) (i) All payments to be made by the Shipowner under this Agreement and
the Floating Rate Note shall be made without set-off or counterclaim in Dollars
in immediately available and freely transferable funds no later than 11:00 A.M.
(New York City time) on the date on which due. Except as provided in Section
7.01(a)(ii), all payments to be made by the Shipowner or the Agents hereunder
shall be made to (A) the Primary Lender (for the account of GOVCO Incorporated,
its successors and assigns), (B) the Alternate Lender (for the account of
Citibank, N.A., its successors and assigns), (C) the Facility Agent (for the
account of Citibank International plc, its successors and assigns), (D) the
Administrative Agent (for the account of Citicorp North America, Inc., its
successors and assigns), or (E) any other Lender (for the account of such
Lender, its successors and assigns), in each case to the Facility Agent (for the
account of Citibank International plc, London, its successors and assigns) at
Citibank, N.A., 000 Xxxxxxxxx Xxxxxx, 00xx floor,
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Xxx Xxxx, XX 00000, DDA. Account No. 00000000, Attn: Loans Agency. - Rowan
Companies, Inc. Upon receipt thereof by the Facility Agent, the Facility Agent
shall forthwith forward such funds to the party entitled thereto pursuant to the
written instructions provided by such party to the Facility Agent in accordance
with Section 11.02.
(ii) The Shipowner shall pay the principal and the guaranteed amount
of the Applicable Interest Rate on the Floating Rate Note to the Indenture
Trustee and all other amounts due under this Agreement directly to the Person
entitled thereto, in each case, by wire transfer in same day and immediately
available and freely transferable funds. Wire transfer instructions shall be
provided to the Shipowner. Until further notice, wire instructions for the
Indenture Trustee are as follows: Allfirst Trust Company, National Association,
ABA #000000000, Credit Trust Receipts, A/C #000-00-000, Re: Rowan Companies,
Inc., Attention Xxxxxx Xxxxxxxx, extension 4224 (GORILLA VIII).
(b) Except as otherwise provided herein, whenever any payment would
otherwise fall due on a day that is not a Business Day, the due date for payment
shall be the immediately succeeding Business Day, and interest and fees shall be
computed in accordance with Section 11.01.
(c) Whenever a sum is required to be paid to the Facility Agent under this
Agreement for the account of another Person, the Facility Agent shall not be
obligated to make such sum available to such other Person unless and until the
Facility Agent shall have established to its satisfaction that it has actually
received payment of such sum. Notwithstanding the foregoing, unless it has
received actual notice to the contrary, the Facility Agent may (but shall not be
obligated to) assume on the date of any Disbursement or any other payment
required to be made by any Lender hereunder that such Lender has made available
to the Facility Agent such Disbursement or other payment and the Facility Agent
may (but shall not be required to) make available to the Shipowner on such date
a corresponding amount in reliance upon such assumption. Additionally, the
Facility Agent may (but shall not be obligated to) assume on the date of any
payment required to be made by the Shipowner hereunder that the Shipowner has
made available to the Facility Agent such payment and the Facility Agent may
(but shall not be required to) make available to the Lenders on such date a
corresponding amount in reliance upon such assumption. If and to the extent that
either (i) the Lender shall not in fact have made such Disbursement or other
payment available to the Facility Agent and the Facility Agent has made
available a corresponding amount to the Shipowner in reliance on the
above-described assumptions or (ii) the Shipowner has not in fact made such
payment and the Facility Agent has made available a corresponding amount to the
Lender in reliance on the above-described assumptions, then, in either such
case, such Lender agrees to repay to the Facility Agent forthwith on demand such
corresponding amount together with an amount sufficient to indemnify the
Facility Agent against any cost or loss it may have suffered or incurred by
reason of its having paid out such sum prior to receipt thereof.
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7.02 Application of Payments. In the absence of an Indenture Default, the
Lenders shall each apply payments received by them under this Agreement and the
Floating Rate Note (whether at Stated Maturity, by reason of acceleration,
prepayment or otherwise), in the following order of priority: (i) interest due
pursuant to Section 4.02(a); (ii) installments of principal due; (iii) interest
due pursuant to Section 4.02(b) other than the amount described in clause (i)
above; (iv) all amounts due under the Fee Letter; and (v) all other amounts due
under this Agreement and not otherwise provided for in this Section 7.02. Upon
the occurrence of an Indenture Default, the Lenders shall each hold any payments
they receive after an Indenture Default from, or on behalf of, the Shipowner
under this Agreement, the Fee Letter and any related agreement (excluding the
Floating Rate Note) and shall promptly deliver such payments to the Secretary if
the Secretary has been required to honor a Guarantee as a result of said
Indenture Default. All such amounts received during an Indenture Default and
delivered to the Secretary in accordance with the preceding sentence shall be
applied first to pay, satisfy and discharge all amounts owed by the Shipowner to
the Secretary under the Secretary's Note and the Mortgage and then to pay,
satisfy and discharge any and all amounts owed to the Lenders or the Agents.
SECTION 8. REPRESENTATIONS AND WARRANTIES BY THE SHIPOWNER
8.01 Representations and Warranties of the Shipowner. The Shipowner
represents and warrants to the Agents and the Lenders that, as of the Closing
Date:
(a) Existence and Authority. The Shipowner is duly organized, validly
existing under the laws of the State of Delaware, is in good standing under the
laws of the State of Delaware, has been duly qualified to do business in, and is
in good standing as a foreign corporation in each jurisdiction in which the
conduct of its business or the ownership of its properties requires it to be so
qualified, and has full power, authority and legal right to own its properties
and conduct its business as it is presently now conducted.
The Shipowner has full power, authority and legal right (i) to execute and
deliver this Agreement, the Floating Rate Note and the Indenture, (ii) to
perform and observe the terms and provisions of each of said documents to be
performed or observed by it, (iii) to consummate the transactions contemplated
thereby and (iv) to own its properties (including, without limitation, the
Vessel owned or to be owned by it) and conduct its business as presently
conducted.
(b) Government and Other Authorizations. All consents, licenses,
authorizations and approvals of, and exemptions by, any Governmental Authority
and any governmental authorities within the United States or elsewhere and any
other Persons that are necessary or advisable: (i) for the execution, delivery,
performance and observance by the Shipowner of this Agreement, the Floating Rate
Note, and the Indenture; and (ii) for the validity, binding effect and
enforceability of this Agreement, the Floating Rate Note, and the Indenture have
been obtained and are in full force and effect.
15
(c) Restrictions. The execution, delivery and performance or observance by
the Shipowner of the terms of, and consummation by the Shipowner of the
transactions contemplated by, this Agreement, the Floating Rate Note, and the
Indenture do not and will not conflict with or result in a breach or violation
of: (i) the charter, by-laws or other organizational documents of the Shipowner;
(ii) any federal or state law of the United States or any other ordinance,
decree, constitutional provision, regulation or other requirement of any
Governmental Authority (including, without limitation, any restriction on
interest that may be paid by the Shipowner); or (iii) any order, writ,
injunction, judgment or decree of any court or other tribunal. Further, the
execution, delivery and performance or observance by the Shipowner of the terms
of, and consummation by the Shipowner of the transactions contemplated by, this
Agreement, the Floating Rate Note, and the Indenture does not and will not
conflict with or result in a breach of any agreement or instrument to which the
Shipowner is a party, or by which it or any of its revenues, properties or
assets may be subject, or result in the creation or imposition of any Lien upon
any of the revenues, properties or assets of the Shipowner pursuant to any such
agreement or instrument. "Lien" shall mean any lien, lease, mortgage, pledge,
hypothecation, preferential arrangement relating to payments, or other
encumbrance or security interest.
(d) Binding Effect. This Agreement, the Floating Rate Note, and the
Indenture, which have been executed on or before the date hereof, have been duly
executed and delivered by the Shipowner. Each of the Agreement, the Floating
Rate Note, and the Indenture constitutes, and each of the Agreement, the
Floating Rate Note, and the Indenture as it may hereafter be amended will
constitute, a direct, general and unconditional obligation of the Shipowner
which is legal, valid and binding upon the Shipowner and enforceable against the
Shipowner in accordance with its respective terms, except to the extent
enforceability thereof is limited by applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws of general application relating to or
affecting the enforcement of creditors rights generally. All obligations
evidenced by the Floating Rate Note will be entitled to the benefits of the
Guarantees and the Authorization Agreement.
(e) Choice of Law. Under applicable conflict of laws principles, the
choice of law provisions of this Agreement, the Floating Rate Note and the
Indenture are valid, binding and not subject to revocation by the Shipowner. In
any proceedings brought for enforcement of this Agreement, the Indenture or the
Floating Rate Note, the choice of the law of the State of New York as the
governing law of such documents will be recognized and such law will be applied.
(f) Legal Proceedings. No legal proceedings are pending or, to the best of
the Shipowner's knowledge, threatened before any court or governmental agency
which might: (i) materially and adversely affect the Shipowner's financial
condition, business or operations; (ii) restrain or enjoin or have the effect of
restraining or enjoining the performance or observance of the terms and
conditions of any of this Agreement, the Indenture or the
16
Floating Rate Note; or (iii) in any other manner question the validity, binding
effect or enforceability of any of the provisions of this Agreement, the
Indenture or the Floating Rate Note.
(g) Use of the Vessel. The Vessel will be used for lawful purposes.
(h) Shipowner Financial Statements. The Shipowner Financial Statements
present fairly the financial condition of the Shipowner at the date of such
statements and the results of the operations of the Shipowner for such fiscal
year. The Shipowner Financial Statements have been prepared in accordance with
generally accepted accounting principles in the United States consistently
applied. Except as fully reflected in the Shipowner Financial Statements, there
are no liabilities or obligations with respect to the Shipowner of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether or
not due) for the period to which the Shipowner Financial Statements relate that,
either individually or in the aggregate, would be material to the Shipowner.
Since the date of the most recent audited Shipowner Financial Statements, there
has been no material adverse change in the financial condition, business
prospects or operations of the Shipowner. "Shipowner Financial Statements" shall
mean the financial statements of the Shipowner furnished to the Facility Agent
prior to the date of this Agreement.
(i) No Taxes. There is no Tax imposed on or in connection with: (i) the
execution, delivery or performance of this Agreement, the Indenture or the
Floating Rate Note; (ii) the enforcement of this Agreement, the Indenture or the
Floating Rate Note; or (iii) on any payment to be made to any Lender under this
Agreement or the Floating Rate Note.
(j) Laws. None of this Agreement, the Indenture, the Floating Rate Note,
the transactions contemplated thereunder nor any Person party to this Agreement,
the Indenture or the Floating Rate Note is required to qualify under the Trust
Indenture Act or register or qualify under any securities law.
(k) Defaults. No Event of Default has occurred and is continuing and no
event or circumstance has occurred and is continuing which with the passage of
time, the giving of notice or both would constitute an Event of Default.
8.02 Agreements of the Shipowner. The Shipowner agrees that until all
amounts owing under this Agreement and the Floating Rate Note have been paid in
full, the Shipowner will, unless the Agents and the Lenders shall have consented
in writing:
(a) Interest Rate Protection. At all times that (1) a Floating Rate
Note exists and (2) either the Applicable Interest Rate is equal to or
greater than the Cap Rate less 0.5% or the Trigger Event has occurred, the
Shipowner (at its expense) within ten (10) Business Days thereafter, shall
(A) enter into, and thereafter maintain in full force and effect, an
amortizing interest rate cap agreement with a strike price providing for a
cap based on the Applicable Interest Rate not in excess of the Cap Rate
per annum and
17
otherwise acceptable to the Lenders, with a counterparty rated "AA" or
better by any of the rating agencies that rate the Commercial Paper issued
by the Primary Lender or such other counterparty reasonably acceptable to
the Lenders, covering the Floating Rate Note and based on the expected
amortization schedule of such Note, and (B) execute such documents and
instruments as may be necessary, or in the opinion of the Facility Agent
desirable, to effect the assignment of its rights thereunder to the
Facility Agent for the benefit of the Lenders and, if any payments are
made under any Guarantee, the Secretary, in every case with such terms as
are reasonably acceptable to the Facility Agent for the protection of the
Lenders. If the Shipowner fails to satisfy the requirements of this
Section 8.02(a) within the ten (10) Business Days set forth above, the
Facility Agent may (in its sole discretion) and if the Facility Agent so
elects, the Shipowner hereby authorizes and directs the Facility Agent to,
satisfy the requirements of this Section 8.02(a), all at the expense of
the Shipowner, due on demand.
(b) Notice of Defaults. Promptly, but in no event later than ten
(10) days after the occurrence of an Indenture Default or an Event of
Default of which the Shipowner has knowledge, notify the Facility Agent
and the Indenture Trustee of any report required by the Shipowner
Documents (or any other document entered into by the Shipowner in
connection therewith), and send a copy thereof to the Facility Agent, in
each case by facsimile or hand delivery.
(c) Financial Reports. Beginning with the fiscal year in which this
Agreement is executed and continuing until all amounts owing under this
Agreement and the Floating Rate Note have been paid in full, the Shipowner
shall furnish to the Facility Agent (and the Facility Agent, upon receipt
thereof, shall furnish to each Lender and the Administrative Agent) a copy
of all financial reports furnished to the Secretary pursuant to the Title
XI Reserve Fund and Financial Agreement.
(d) Other Acts. From time to time, do and perform any and all acts
and execute any and all documents as may be necessary or as reasonably
requested by the Facility Agent or the Indenture Trustee in order to
effect the purposes of this Agreement and to protect the interests of the
Lenders in the Floating Rate Note and the interests of the Lenders in the
Guarantees.
(e) Use of Proceeds. Use proceeds from each Disbursement solely to
finance: (i) the manufacture, construction, fabrication, financing and
purchase of the Vessel; (ii) Construction Period Interest; and (iii) the
Guarantee Fees. Use the proceeds from the issuance of any Fixed Rate Notes
to repay amounts owed under the Floating Rate Note or to finance: (i) the
manufacture, construction, fabrication, financing and purchase of the
Vessel; (ii) Construction Period Interest; and (iii) the Guarantee Fees.
(f) Successors. Require that any successor to all or substantially
all of its business as a result of any merger or consolidation with any
other entity, dissolution or termination of legal existence, sale, lease,
transfer or
18
other disposal of any substantial part of its properties or any of its
properties essential to the conduct of its business or operations, as now
or hereafter conducted, any change in control, any agreement to do any of,
or any combination of, the foregoing, to assume all of the Shipowner's
indebtedness, liabilities and obligations under this Agreement, the
Indenture and the Floating Rate Note.
SECTION 9. CANCELLATION, SUSPENSION AND EVENTS OF DEFAULT
9.01 Cancellation. The Shipowner may cancel at any time all or any part of
the Available Amount of the Credit Facility, provided that (i) thirty (30) days'
prior irrevocable written notice is given to the Agents, the Indenture Trustee,
and the Secretary and (ii) the Shipowner shall have paid to the Lenders any
commitment fees accrued and unpaid under Section 6.01 and all other amounts due
and payable under this Agreement and the Floating Rate Note as of the proposed
date of cancellation. In the absence of an Indenture Default, the Lenders may
not for any reason cancel at any time any part of the Available Amount of the
Credit Facility.
9.02 Events of Default. Upon the occurrence of any of the following events
or conditions (each, an "Event of Default"):
(a) any failure by the Shipowner to pay when and as due any amount
owing under this Agreement, but which is not guaranteed by the Secretary;
or
(b) any failure by the Shipowner to comply with its obligations
under Section 8.02(b) or 8.02(e); or any failure by the Shipowner to
perform or comply with any of its agreements set forth in this Agreement
(exclusive of any events specified as an Event of Default in any other
subsection of this Section 9.02 and exclusive of Section 8.02(a)), which
failure, if capable of being cured, remains uncured for a period of thirty
(30) days after written notice thereof has been given to the Shipowner by
the Facility Agent; or
(c) the Shipowner shall be unable to pay its debts when and as they
fall due or shall admit in writing its inability to pay its debts as they
fall due or shall become insolvent; or the Shipowner shall apply for or
consent to the appointment of any liquidator, receiver, trustee or
administrator for all or a substantial part of its business, properties,
assets or revenues; or a liquidator, receiver, trustee or administrator
shall be appointed for the Shipowner and such appointment shall continue
undismissed, undischarged or unstayed for a period of thirty (30) days, or
the Shipowner shall institute (by petition, application, answer, consent
or otherwise) any bankruptcy, arrangement, readjustment of debt,
dissolution, liquidation or similar executory or judicial proceeding; or a
bankruptcy, arrangement, readjustment of debt, dissolution, liquidation or
similar executory or judicial proceeding shall be instituted against the
Shipowner and shall remain undismissed, undischarged or unstayed for a
period of thirty (30) days; or
19
(d) an Indenture Default has occurred;
then, and in any such event, and at any time thereafter, if such event is
continuing, and if there is no Indenture Default (or if there is an
Indenture Default, only after the Secretary has received all payments due
under the Secretary's Note and the Mortgage), any Agent or any Lender (by
written notice to the Shipowner), shall have the right to institute any
judicial or other proceedings under this Agreement to recover all amounts
owing under this Agreement. The Lenders agree that so long as an Indenture
Default exists, all amounts received during such period from, or on behalf
of, the Shipowner shall be applied in the manner set forth in Section
7.02. Notwithstanding an Event of Default, the Lenders may not terminate
the Available Amount of the Credit Facility without the Secretary's
consent; provided, however, that the Shipowner's use of the Available
Amount of the Credit Facility shall remain subject to the requirements of
Sections 2.02, 3.01, and 5.02. Except as expressly provided above in this
Section 9.02, presentment, demand, protest and all other notices of any
kind are hereby expressly waived. Notwithstanding any other provision of
this Agreement, if Section 9.02(c) is applicable, the Lender may file
appropriate claims in connection therewith, but shall apply any funds
collected as a consequence of said filings in accordance with the
provisions of Section 7.02 of this Agreement.
SECTION 10. GOVERNING LAW AND JURISDICTION
10.01 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.02 Submission to Jurisdiction. Each of the Shipowner and the Lenders
hereby irrevocably agrees that any legal suit, action or proceeding arising out
of or relating to this Agreement, or any of the transactions contemplated
hereby, may be instituted by the other parties hereto in the Courts of the State
of New York or the Federal Courts sitting in the Borough of Manhattan, City of
New York, State of New York. Each of the Shipowner and the Lenders hereby
irrevocably waives, to the fullest extent permitted by law, any objection which
it may have now or hereafter to the laying of the venue or any objection based
on forum non conveniens, or based on the grounds of jurisdiction with respect to
any such legal suit, action or proceeding and irrevocably submits generally and
unconditionally to the jurisdiction of any such court in any such suit, action
or proceeding. Each of the Shipowner and the Lenders agrees that a judgment,
after exhaustion of all available appeals, in any such action or proceeding
shall be conclusive and binding upon it and may be enforced in any other
jurisdiction by suit upon such judgment, a certified copy of which shall be
conclusive evidence of the judgment. Each of the Shipowner and the Lenders
waives personal service of any summons, complaint, or other process, which
service may be made by such or any other means permitted by New York law.
20
10.03 Waiver of Security Requirements. To the extent the Shipowner may, in
any action or proceeding arising out of or relating to this Agreement be
entitled under applicable law to require or claim that the Agents or the Lenders
post security for costs or take similar action, the Shipowner hereby irrevocably
waives and agrees not to claim the benefit of such entitlement.
10.04 No Limitation. Nothing in this Section 10 shall affect the right of
the Agents or any Lender to serve process in any manner permitted by law or to
commence legal proceedings or otherwise proceed against the Shipowner in any
jurisdiction; provided, however, that except as provided in Section 9.02, in the
event of an Indenture Default, the Agents and the Lenders may not proceed
against the Shipowner without the Secretary's consent unless the Secretary has
received full payment under the Secretary's Note.
SECTION 11. MISCELLANEOUS
11.01 Computations. Each determination of an interest rate by the
Administrative Agent or the Facility Agent, or any other Person pursuant to any
provision of this Agreement, the Fee Letter or the Floating Rate Note, in the
absence of error, shall be conclusive and binding on the Shipowner. Each
determination of a fee or other amounts (excluding interest rates) by the
Facility Agent, any Lender, or any other Person pursuant to any provision of
this Agreement, the Fee Letter or the Floating Rate Note, in the absence of
manifest error, shall be conclusive and binding on the Shipowner. All
computations of interest and fees hereunder and under the Floating Rate Note
shall be made on the basis of a year of three hundred sixty-five (365) days and
actual days elapsed; provided, however, that the CP Rate and LIBOR shall be
determined on the basis of a year of 360 days and actual days elapsed. The
Secretary and Indenture Trustee may request supporting documentation for the
information provided by the Facility Agent or the Administrative Agent to the
Indenture Trustee.
11.02 Notices. Except as otherwise specified, all notices given hereunder
shall be in writing, and shall be given by mail, facsimile, telex or personal
delivery and shall be deemed to be given for the purposes of this Agreement on
the day that such notice is received by the intended recipient thereof. Unless
otherwise specified in a notice delivered in accordance with this Section 11.02,
all notices shall be delivered to the parties hereto and to the Indenture
Trustee and the Secretary at their respective addresses indicated below:
21
To the Facility Agent and the Lenders:
Address: Citibank International plc, as Facility Agent
0xx Xxxxx
Xxxxxxxxx Xxxxx
00 Xxxxxxxxxx Xxxxxx
XX 137 EU
Attention: Loans Agency
Telephone: 000 00 00 0000 0000
Facsimile: 011 44 20 7500 4482-4484
With a copy to:
Citibank, N.A., as the Alternate Lender
5th Floor
Citigroup Centre
00 Xxxxxx Xxxxxx
Xxxxxx
X00 0XX
Attention: Structured Trade Finance
Facsimile 011 44 20 7986 4823/4856
Telephone: 000 00 00 0000 0000
With a copy to the Administrative Agent
To the Administrative Agent
Address: Citicorp North America, Inc.
000 Xxxxxxxxx Xxxxxx
00xx xxxxx
Xxx Xxxx, XX 00000
Attention: Structured Trade Finance
Facsimile (000) 000-0000
Telephone: (000) 000-0000
To the Shipowner
Address: ROWAN COMPANIES, INC.
Suite 5450
0000 Xxxx Xxx Xxxxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
22
To the Secretary
Address: SECRETARY OF TRANSPORTATION
c/o Maritime Administrator
000 Xxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Office of Ship Finance
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To the Indenture Trustee
Address: ALLFIRST TRUST COMPANY, NATIONAL ASSOCIATION
Mail Code 101-591
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
11.03 Disposition of Indebtedness. Once the Shipowner has completely drawn
down on the Credit Facility and the Available Amount is zero, each Lender may
sell, assign, transfer, negotiate, or otherwise dispose of all or any part of
its interest in all or any part of the Shipowner's indebtedness under this
Agreement and the Floating Rate Note to any party (collectively, a "Disposition
of Indebtedness"), and any such party shall enjoy all the rights and privileges
of such Lender under this Agreement and the Floating Rate Note to the extent of
the interest sold or assigned; provided, however, that each Disposition of
Indebtedness to any Person other than another Lender or a domestic Affiliate of
a Lender shall require the prior written consent of the Shipowner (which consent
shall not be unreasonably withheld or delayed); provided, further, however, that
each Lender may pledge or grant participation in all or any part of its interest
in all or any part of the Shipowner's indebtedness under this Agreement and the
Floating Rate Note to any party at any time so long as such Lender's commitment
to lend the Available Amount under this Agreement is not affected thereby. The
Shipowner shall, at the request of the Facility Agent, execute and deliver to
the Facility Agent or to any party that the Facility Agent may designate, any
such further instruments as may be necessary or desirable to give full force and
effect to a Disposition of Indebtedness by the applicable Lender.
11.04 Disclaimer. Neither the Agents nor the Lenders shall be responsible
in any way for the performance of the Construction Contract or any other
Shipowner Document, and no claim against the Shipbuilder or any other Person
with respect to the performance of the Construction Contract will affect the
obligations of the Shipowner under this Agreement or the Floating Rate Note.
11.05 No Waiver; Remedies Cumulative. No failure or delay on the part of
any Agent or any Lender in exercising any right, power or privilege
23
under this Agreement, the Floating Rate Note or the Indenture and no course of
dealing between or among the Shipowner and any Agent or any Lender shall operate
as a waiver of the rights of the Shipowner and such Lenders against each other
under this Agreement; nor shall any single or partial exercise of any right,
power or privilege hereunder or under the Floating Rate Note or the Indenture
preclude the Shipowner, the Agents, or the Lenders from exercising against each
other any other right, power or privilege hereunder. The rights and remedies
expressly provided herein are cumulative and not exclusive of any rights or
remedies that the Agents or the Lenders would otherwise have. No notice to or
demand on the Shipowner in any case shall entitle the Shipowner to any other or
further notice or demand in similar or other circumstances or constitute a
waiver of the rights of any Agent or any Lender under this Agreement to any
other or further action in any circumstances without notice or demand.
Notwithstanding any other provision to the contrary herein, no provision in this
Agreement or any other related agreement preserves any rights in favor of the
parties against the Secretary in the event that either party fails or delays to
exercise any rights, powers, or privileges under this Agreement, the Floating
Rate Note or the Indenture or engages in any particular course of dealing.
11.06 Currency. All payments of principal, interest, fees or other amounts
due hereunder and under the Floating Rate Note shall be made in Dollars,
regardless of any law, rule, regulation or statute, whether now or hereafter in
existence or in effect in any jurisdiction, which affects or purports to affect
such obligations.
11.07 Severability. To the extent permitted by applicable law, the
illegality or unenforceability of any provision of this Agreement shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement.
11.08 Amendment or Waiver. This Agreement may not be changed, discharged
or terminated without the written consent of the parties hereto, and no
provision hereof may be waived without the written consent of the party to be
bound thereby. There may be no change, discharge, termination or claim of waiver
of the terms of this Agreement without the prior written consent of the
Secretary, who is entitled to enforce his rights under this Agreement as an
intended third party beneficiary to this Agreement. The parties hereto
acknowledge, however, that nothing in this Agreement creates in either the
Shipowner or the Lenders any right whatsoever against the Secretary.
11.09 Indemnification. Without limiting any other rights that any Agent or
any Lender may have hereunder or under applicable law, the Shipowner hereby
agrees to indemnify each of the Agents and the Lenders (each, an "Indemnified
Party") from and against any and all damages, losses, claims, liabilities and
related costs and expenses, including reasonable attorneys' fees and
disbursements (all the foregoing being collectively referred to as "Indemnified
Amounts") awarded against or incurred by such Indemnified Party arising out of
or as a result of this Agreement or the Floating Rate Note excluding, however,
Indemnified Amounts to the extent resulting from gross
24
negligence or willful misconduct on the part of such Indemnified Party. In the
event of an Indenture Default, all amounts received by such Indemnified Party
pursuant to such indemnification after an Indenture Default shall be held and
paid in the manner required by Section 7.02.
11.10 Benefit of Agreement. This Agreement shall be binding upon and inure
to the benefit of and be enforceable by the respective successors and assigns of
the parties hereto; provided, however, that the Shipowner may not assign any of
its rights or obligations hereunder without the prior written consent of the
Lenders, and, to the extent set forth in paragraph 11.03 hereof, the Secretary.
11.11 Waiver of Jury Trial. Each of the Shipowner and the Lenders waives
its respective rights to a trial by jury of any claim or cause of action based
upon or arising out of or related to this Agreement, any assignment or the
transactions contemplated hereby, in any action, proceeding or other litigation
of any type brought by any party against the other parties, whether with respect
to contract claims, tort claims, or otherwise. Each of the Shipowner and the
Lenders agrees that any such claim or cause of action shall be tried by a court
trial without a jury. Without limiting the foregoing, the parties further agree
that their respective right to a trial by jury is waived by operation of this
section as to any action, counterclaim or other proceeding which seeks, in whole
or in part, to challenge the validity or enforceability of this Agreement, any
assignment or any provision hereof or thereof. This waiver shall apply to any
subsequent amendments, renewals, supplements or modifications to this Agreement
or any assignment.
11.12 Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement. Delivery of an executed counterpart of a signature page to this
Agreement by facsimile shall be effective as delivery of a manually executed
counterpart of this Agreement.
11.13 Shipowner Documents. Notwithstanding the provisions of this
Agreement, in any conflict between this Agreement and the provisions of the
Shipowner Documents, the Shipowner Documents shall govern the agreement between
the parties hereto, but only with respect to the subject matter thereof.
Notwithstanding the previous sentence, any provision in the Indenture (or any
other agreement the Shipowner has entered into with any other Person) purporting
to release the Shipowner of any indebtedness, liability or obligation shall not
apply to any indebtedness, liability or obligation of the Shipowner hereunder
and no termination of the Indenture (or any other agreement the Shipowner has
entered into with any other Person) shall affect the continued effectiveness of
this Agreement, which shall continue in full force and effect until the Credit
Facility has been terminated and all indebtedness, liabilities and obligations
of the Shipowner have been fully discharged and satisfied, the Floating Rate
Note have been paid, satisfied and discharged in full, and there has elapsed a
year and a day from the last payment received from, or on behalf, of the
Shipowner. However, this Section 11.13 shall have no affect on the
25
relationships established and the agreements entered into by the parties to the
Shipowner Documents (and such other agreements the Shipowner has entered into
with any other Person), in each case to which the Lenders are not parties in
their capacities as the Lenders hereunder.
11.14 Entire Agreement. This Agreement, the Fee Letter and the Floating
Rate Note contain the entire agreement among the parties hereto regarding the
Credit Facility.
11.15 No Proceedings. Each of the Shipowner, the Alternate Lender and the
Agents hereby agrees that it will not institute against, or join any other
Person in instituting against, the Primary Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding, or any other
proceeding under any federal or state bankruptcy or similar law, so long as any
Commercial Paper issued by the Primary Lender shall be outstanding or there
shall not have elapsed one year plus one day since the last day on which any
such Commercial Paper shall have been outstanding.
SECTION 12. ARRANGEMENTS AMONG THE AGENTS AND THE LENDERS
12.01 Appointment. Each Lender hereby appoints the Facility Agent to act
as its agent in connection herewith and in connection with the Floating Rate
Note and the Indenture and authorizes the Facility Agent to exercise such
rights, powers and discretions as are specifically delegated to the Facility
Agent by the terms hereof and thereof, together with all such rights, powers and
discretions as are reasonably incidental thereto. Without limiting the
foregoing, all notices to be delivered to, and approvals to be given by, a
Lender under the disbursement procedures described in Section 3.01 hereof shall
be delivered to and given by the Facility Agent on behalf of such Lender.
12.02 Rights of Facility Agent. The Lenders and the Facility Agent agree
that the Facility Agent may:
(i) assume that (a) any representation made by the Shipowner in connection
herewith is true; (b) no event which is or may become an Event of Default has
occurred; (c) the Shipowner is not in breach of or default under its obligations
hereunder; (d) any right, power, authority or discretion vested herein upon the
Lenders or any other person or group of persons has not been exercised; unless
it has, in its capacity as Facility Agent, notice or actual knowledge to the
contrary;
(ii) engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or services may to it seem
necessary, expedient or desirable and rely upon any advice so obtained;
(iii) rely as to any matters of fact that might reasonably be expected to
be within the knowledge of the Shipowner upon a certificate signed by or on
behalf of the Shipowner;
26
(iv) rely upon any communication or document believed by it to be genuine;
(v) refrain from exercising any right, power or discretion vested in it as
facility agent hereunder unless and until instructed by a Lender as to whether
or not such right, power or discretion is to be exercised and, if it is to be
exercised, as to the manner in which it should be exercised; and
(vi) refrain from acting in accordance with any instructions of any Lender
to begin any legal action or proceeding arising out of or in connection with
this Agreement until it shall have received such security as it may require
(whether by way of payment in advance or otherwise) for all costs, claims,
expenses (including legal fees) and liabilities which it will or may expend or
incur in complying with such instructions.
12.03 Duties. The Facility Agent shall:
(i) promptly inform each Lender of the contents of any notice or
document received by it from the Shipowner hereunder;
(ii) promptly notify each Lender of the occurrence of any Event of
Default or any default by the Shipowner in the due performance of or
compliance with its obligations under this Agreement of which the
Facility Agent has notice from any other party hereto;
(iii) save as otherwise provided herein, act as facility agent hereunder
in accordance with any instructions given to it by any Lender, which
instructions shall be binding on all of the Lenders; and
(iv) if so instructed by any Lender, refrain from exercising any right,
power or discretion vested in it as facility agent hereunder.
12.04 Limitation on Obligations of Facility Agent. Notwithstanding
anything to the contrary expressed or implied herein, the Lenders and the
Facility Agent agree that the Facility Agent shall not:
(i) be bound to inquire as to:
(a) whether or not any representation made by the Shipowner in
connection herewith is true;
(b) the occurrence or otherwise of any event which is or may
become an Event of Default;
27
(c) the performance by the Shipowner of its obligations hereunder;
or
(d) any breach of or default by the Shipowner or under its
obligations hereunder;
(ii) be bound to account to any Lender for any sum or the profit element
of any sum received by it for its own account;
(iii) be bound to disclose to any other person any information relating to
the Shipowner or any of its agencies if such disclosure would or might in its
opinion constitute a breach of any law or regulation or be otherwise actionable
at the suit of any person; or
(iv) be under any obligations other than those for which express provision
is made herein.
12.05 Indemnification by Lenders. The Alternate Lender shall, from time to
time on demand by the Facility Agent, indemnify the Facility Agent, against any
and all costs, claims, expenses (including legal fees) and liabilities
(collectively, "Liabilities") together with any tax thereon which the Facility
Agent may incur, otherwise than by reason of its own gross negligence or willful
misconduct, in acting in its capacity as facility agent hereunder (including,
without limitation, any Liabilities in anyway relating to or arising out of
certifications made with respect to either (a) the due authorization, execution
or delivery of a Floating Rate Note, or (b) laws and/or regulations of any
Governmental Authority, in each case in connection with any request by the
Facility Agent to the Indenture Trustee or the Secretary for the Secretary to
endorse its guarantee on a Floating Rate Note or for the Indenture Trustee to
authenticate a Floating Rate Note).
12.06 Limitation on Responsibility. The Facility Agent accepts no
responsibility to the Lenders for the accuracy and/or completeness of any
information supplied by the Shipowner in connection herewith or for the
legality, validity, effectiveness, adequacy or enforceability of this Agreement,
and the Facility Agent shall be under no liability to the Lenders as a result of
taking or omitting to take any action in relation to this Agreement, save in the
case of its own negligence or willful misconduct.
12.07 No Claims on Employees of Facility Agent. Each Lender agrees that it
will not assert or seek to assert against any director, officer or employee of
the Facility Agent any claim that it might have against it in respect of the
matters referred to in Clause 12.06.
12.08 Banking Business. The Lenders agree that the Facility Agent may
accept deposits from, lend money to and generally engage in any kind of banking
or other business with the Shipowner.
28
12.09 Resignation or Termination of Facility Agent.
(i) The Facility Agent may (after consultation with the Shipowner and the
Lenders) resign its appointment hereunder at any time without assigning any
reason therefor by giving not less than thirty (30) days' prior written notice
to that effect to each of the other parties hereto; provided, that no such
resignation shall be effective until a successor for the Facility Agent is
appointed in accordance with the succeeding provisions of this Section 12;
(ii) The Lenders and the Shipowner may jointly seek the termination of the
appointment of the Facility Agent hereunder at any time by giving not less than
thirty (30) days prior written notice to that effect to the Facility Agent;
provided that no such termination shall be effective until a successor for the
Facility Agent is appointed in accordance with the succeeding provisions of this
Section 12; provided further that any such notice of termination must be signed
by all of the Lenders and the Shipowner; and
(iii) For the avoidance of doubt, the parties hereto agree that the
provisions of this Section 12.09 shall at no time apply to or restrict the
ability of the Administrative Agent to resign its position of Administrative
Agent.
12.10 Successor to Facility Agent. If the Facility Agent gives notice of
its resignation pursuant to Section 12.09(i) or receives notice of termination
pursuant to Section 12.09(ii), then any reputable and experienced bank or other
financial institution may be appointed as a successor to the Facility Agent by
the Lenders with the consent of the Secretary and Shipowner (which consent of
the Shipowner shall not be unreasonably withheld or delayed) during the period
of such notice but, if no such successor is so appointed, the Facility Agent may
appoint such a successor itself with the consent of the Secretary and Shipowner
(which consent of the Shipowner shall not be unreasonably withheld or delayed).
12.11 Discharge of Obligations. If a successor to the Facility Agent is
appointed under the provisions of Section 12.10, then (i) the retiring Facility
Agent shall be discharged from any further obligation hereunder but shall remain
entitled to the benefits of the provisions of this Section 12 and (ii) its
successor and each of the other parties hereto shall have the same rights and
obligations amongst themselves as they would have had if such successor had been
a party hereto.
12.12 Responsibilities of Lenders. It is understood and agreed by each
Lender that it is, and will continue to be, solely responsible for making its
own independent appraisal of and investigations into the financial condition,
creditworthiness, condition, affairs, status and nature of the Shipowner, the
Secretary and the United States of America and, accordingly, each Lender
warrants to the Facility Agent that it has not relied and will not hereafter
rely on the Facility Agent:
(i) to check or inquire on its behalf into the adequacy, accuracy or
completeness of any information provided by
29
the Shipowner in connection with this Agreement or the transaction
herein contemplated (whether or not such information has been or is
hereafter circulated to such Lender by the Facility Agent); or
(ii) to assess or keep under review on its behalf the financial
condition, creditworthiness, condition, affairs, status or nature of
the Shipowner.
12.13 Agency Division. In acting as Facility Agent for the Lenders, the
Facility Agent's agency division shall be treated as a separate entity from any
other of its divisions or departments and, notwithstanding the foregoing
provisions of this Section 12, in the event that the Facility Agent should act
for the Shipowner in any capacity in relation to any other matter, any
information given by the Shipowner to the Facility Agent in such other capacity
may be treated as confidential by the Facility Agent.
12.14 Administrative Agent. Each party hereto (other than the
Administrative Agent) acknowledges that the Administrative Agent is a party
hereto only in its capacity as administrative agent of the Primary Lender and
the Primary Lender's commercial paper holders.
12.15 Facility Agent Only Agent for the Lenders. The Facility Agent is not
authorized to, nor shall it, act as the agent for the Secretary, the Indenture
Trustee, the Shipowner or any of their successors in interest or assigns in any
of the capacities provided for herein.
30
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be duly executed and delivered as of the date first above written.
ROWAN COMPANIES, INC., as the GOVCO INCORPORATED, as the
Shipowner Primary Lender, by Citicorp North
America, Inc., its attorney-in-fact.
By: X. X. Xxxxxx By: P.A. Botticelli
--------------------------------- ---------------------------------
(Signature) (Signature)
Name: X. X. Xxxxxx Name: P.A. Botticelli
------------------------------- -------------------------------
(Print) (Print)
Title: Senior Vice President Title: Vice President
------------------------------
(Print)
CITIBANK INTERNATIONAL plc, CITIBANK, N.A., as the Alternate Lender
as Facility Agent
By: P. A. Botticelli By: Ae Xxxxx Xxxxx
--------------------------------- ---------------------------------
(Signature) (Signature)
Name: P. A. Botticelli Name: Ae Xxxxx Xxxxx
------------------------------- -------------------------------
(Print) (Print)
Title: Vice President Title: Vice President
------------------------------ ------------------------------
(Print) (Print)
CITICORP NORTH AMERICA, INC., as the Administrative Agent
By: P. A. Botticelli
---------------------------------
(Signature)
Name: P. A. Botticelli
-------------------------------
(Print)
Title: Vice President
------------------------------
(Print)
31
APPENDIX II TO GUARANTEE COMMITMENT DOCUMENT 4
TRUST INDENTURE
SPECIAL PROVISIONS
THIS TRUST INDENTURE, dated May 23, 2001 (the "Indenture" or the
"Agreement"), is between (i) ROWAN COMPANIES, INC., a Delaware corporation (the
"Shipowner"), and (ii) ALLFIRST TRUST COMPANY, NATIONAL ASSOCIATION, a national
banking association (the "Indenture Trustee").
RECITALS:
WHEREAS, to aid in financing the construction of the Vessel, the Shipowner
has entered into a credit agreement (the "Credit Agreement") with GOVCO
INCORPORATED a Delaware corporation (the "Primary Lender"), CITIBANK, N.A., a
national banking association (the "Alternate Lender'), CITIBANK INTERNATIONAL
PLC, a bank organized and existing under the laws of England (the "Facility
Agent") and CITICORP NORTH AMERICA, INC., a Delaware corporation (the
"Administrative Agent") providing for the delivery of no more than $187,295,000
principal amount of notes designated "United States Government Guaranteed Ship
Financing Obligations, GORILLA VIII Series";
WHEREAS, the Secretary, on behalf of the United States, has agreed to
Guarantee the payment of the unpaid interest to the date of such payment on, and
the unpaid balance of the principal of, such Obligations under the provisions of
Title XI of the Act, and has authorized the Indenture Trustee to cause the
Guarantees to be imprinted on the Obligations pursuant to the Authorization
Agreement.
NOW THEREFORE, in consideration of the premises, of the mutual covenants
herein contained, of the purchase of the Obligations by the Holders thereof, and
of other good and valuable consideration, the receipt and adequacy of which the
parties hereby acknowledge, and for the equal and proportionate benefit of all
the present and future Holders of the Obligations, the parties hereto agree as
follows:
1. INCORPORATION OF GENERAL PROVISIONS. This Indenture shall consist of
two parts: the Special Provisions and the General Provisions attached hereto as
Exhibit 1, and they shall be treated as one instrument. In the event of a
conflict, the terms of the Special Provisions shall prevail.
2. THE OBLIGATIONS.
(a) The Obligations issued hereunder shall be designated "United States
Government Guaranteed Ship Financing Obligations, GORILLA VIII Series," and
shall be in the forms of Exhibits 2 and 3 to this Indenture; and, the aggregate
principal amount of Obligations which may be issued under this Indenture shall
not exceed $187,295,000.
(b) The denominations of the Obligations shall be in integral multiples of
$1,000.
(c) The Shipowner shall at all times cause to be maintained in the City of
Baltimore, State of Maryland, an office or agency for the purposes specified in
Section 5.03 of Exhibit 1 to this Indenture.
(d) The Indenture Trustee shall at all times have its Corporate Trust
Office in the City of Baltimore, State of Maryland.
32
3. INTEREST RATE CALCULATION. Upon the terms and subject to the conditions
contained in the Obligations, and based on information received from the
Facility Agent (but only in connection with the Floating Rate Note), the
Indenture Trustee shall calculate the Applicable Interest Rate on the
Obligations in the manner and at the times provided in the Obligations and shall
communicate the same to the Shipowner, the Secretary and any paying agent
identified to it in writing as soon as practicable after each determination. The
Indenture Trustee, based on information received from the Facility Agent (but
only in connection with the Floating Rate Note), shall, upon the request of the
Holder of the Obligations, determine the Applicable Interest Rate then in effect
with respect to the Obligations.
4. CERTAIN REDEMPTIONS
(a) SCHEDULED MANDATORY REDEMPTION. The Obligations are subject to
redemption at a Redemption Price equal to 100% of the principal amount thereof,
together with interest accrued thereon to the applicable Redemption Date,
through the operation of scheduled repayment providing for the semi-annual
redemption on January 15 and July 15 of each year, commencing January 15, 2004
of $5,203,000 of principal amount of Obligations, which amount represents
approximately one thirty-sixth (1/36) of the Original Principal Amount of
Obligations, plus interest accrued thereon to the Redemption Date. There shall
be a final redemption of the remaining outstanding principal of the Floating
Rate Note on the earliest of (i) January 15, 2008, (ii) four (4) years after the
Delivery Date, or (iii) at the request of the Secretary, within fifteen (15)
Business Days from the date upon which the Trigger Event (as hereinafter
defined) shall occur, and a final redemption of the remaining outstanding
principal of the Fixed Rate Notes on July 15, 2021.
Notwithstanding the foregoing provisions of this subsection (a), if the
principal amount of Outstanding Obligations shall be reduced by reason of any
redemption pursuant to Sections 3.04 or 3.06 of Exhibit 1 to this Indenture, the
principal amount of Obligations to be redeemed pursuant to this subsection (a)
on each subsequent Redemption Date for such Obligations shall be reduced by an
amount equal to the principal amount of such Obligations retired by reason of
such redemption pursuant to Sections 3.04 or 3.06 of Exhibit 1 hereto divided by
the number of Redemption Dates (including the Stated Maturity of such
Obligations) scheduled thereafter to January 15, 2008 in the case of the
Floating Rate Note and July 15, 2021 in the case of Fixed Rate Note(s) (subject
to such increase as shall be necessary so that the total principal amount of
Obligations to be redeemed on any such Redemption Date shall be an integral
multiple of $1,000); provided that, the entire unpaid principal amount of the
Outstanding Obligations shall be paid not later than January 15, 2008 in the
case of the Floating Rate Note and July 15, 2021 in the case of each Fixed Rate
Note. The Shipowner shall, in accordance with Section 3.02(e) of Exhibit 1
hereto, promptly after each redemption pursuant to said Sections 3.04 or 3.06,
furnish to the Secretary, the Indenture Trustee and each Holder a revised table
of scheduled repayments reflecting the reductions made pursuant to this
subsection (a) as a result of such redemption.
(b) OPTIONAL REDEMPTION OF OBLIGATIONS WITHOUT PREMIUM. At its option, the
Shipowner may without premium,
(i) prepay on any Interest Payment Date the Floating Rate Note, in
whole or in part, in a minimum principal amount of
$10,000,000, at a Redemption Price equal to 100% of the
principal amount thereof together with interest accrued
thereon to the Redemption Date, or
33
(ii) redeem or prepay the Floating Rate Note, in whole or in part,
on a Redemption Date designated by the Shipowner, from the proceeds from
the issuance of the Fixed Rate Notes.
(c) OPTIONAL REDEMPTIONS OF OBLIGATIONS AT MAKE-WHOLE PREMIUM. At its
option, the Shipowner may prepay on any Interest Payment Date the Fixed Rate
Notes, in whole or in part, in a minimum principal amount of $10,000,000, at a
Redemption Price equal to 100% of the principal amount thereof together with
interest accrued thereon to the Redemption Date plus the Make-Whole Premium, if
any. Prepayments shall be applied pro rata against each Fixed Rate Note and
applied against the scheduled principal payments in the inverse order of
scheduled maturity.
(d) OPTIONAL REDEMPTIONS. If the Shipowner shall elect to make any such
optional redemptions pursuant to this Article, the Shipowner shall, at least 40
days but not more than 60 days prior to the date fixed for redemption, deliver
to the Indenture Trustee (1) a Request stating that the Shipowner intends to
exercise its rights as above set forth to make such optional redemptions and
specifying the Redemption Date and the principal amount which the Shipowner
intends to redeem on such date, and (2) at least 35 days prior to the date fixed
for redemption in the case of the Fixed Rate Notes, deliver to the Indenture
Trustee an amount equal to the Make Whole Premium estimated by the Indenture
Trustee, based on information received from the Holder or a calculation agent,
to be paid on the Redemption Date. The Indenture Trustee, based on information
received from the Holder or a calculation agent, shall give an estimate of the
Make Whole Premium to the Shipowner within two (2) Business Days of the delivery
of the Shipowner's Request. In the event the amount of the Make Whole Premium
deposited by the Shipowner with the Indenture Trustee pursuant to this section
(and interest, if any, accrued thereon, less any losses incurred on the
investment thereof) is insufficient to pay the amount of the Make Whole Premium,
the Shipowner shall pay the amount of the shortfall to the Indenture Trustee in
immediately available funds upon one (1) day's notice. In the event the amount
of the Make Whole Premium deposited by the Shipowner pursuant to this section
(and interest, if any, accrued thereon, less any losses incurred on the
investment thereof) exceeds the Make Whole Premium, the excess amount shall be
refunded to the Shipowner by the Indenture Trustee in immediately available
funds on the Redemption Date.
(e) FIXED RATE NOTE INTEREST RATE PROTECTION. (1) The Shipowner shall
redeem the Floating Rate Note in full by causing to be issued one or more fixed
rate obligations with a maturity equal to July 15, 2021 and using the proceeds
thereof to repay the Floating Rate Note in full, whenever the Treasury constant
maturities rate (10-year) as reported by the Federal Reserve Board in
statistical release H.15 (519) (the "Treasury Rate") equals or exceeds nine
percent (9.0%) per annum (the "Trigger Event"). If the Trigger Event should
occur, the Shipowner shall redeem the Floating Rate Note in full by causing to
be issued one or more fixed rate obligations and using the proceeds thereof to
repay the Floating Rate Note in full, at the request of the Secretary, within
fifteen (15) Business Days from the date of the Trigger Event.
(2) Nothing herein shall prevent the Shipowner from redeeming the Floating
Rate Note by the issuance of one or more fixed rate obligations at any time
prior to Maturity.
(3) The failure of the Shipowner to redeem the Floating Rate Note in full
by causing to be issued one or more fixed rate obligations and using the
proceeds thereof to repay the Floating Rate Note in full, at the request of the
Secretary, within fifteen (15) Business Days, unless subsequently waived in
writing by the Secretary, shall constitute
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an Indenture Default without further notice to the Shipowner or the Holders
being required under the Indenture.
5. ADDITIONS, DELETIONS AND AMENDMENTS TO EXHIBIT 1
The following additions, deletions and amendments are hereby made to
Exhibit 1 to this Indenture.
(a) CONCERNING IMMEDIATELY AVAILABLE FUNDS. Notwithstanding any provision
in Exhibit 1 to this Indenture to the contrary, all payments are to be made in
immediately available funds.
(b) CONCERNING MANDATORY SCHEDULED REDEMPTIONS. The terms "sinking fund
payment" and "sinking fund redemption" in Exhibit 1 to this Indenture refer to
the mandatory scheduled redemption.
(c) INTEREST RATES. Interest at the Applicable Interest Rate shall be due
on each Disbursement at the end of each Interest Period. The Indenture Trustee,
based on information received from the Facility Agent (but only in connection
with the Floating Rate Note), shall determine the Applicable Interest Rate for
each Interest Period.
(d) CONCERNING DISBURSEMENT NOTATIONS. Upon receipt from the Lender of
documents confirming Disbursements, the Indenture Trustee shall review Exhibit A
of the Floating Rate Note (the "Grid"), and calculate principal and applicable
interest thereon, from time to time. If the Indenture Trustee's calculations are
not consistent with those of the Lender, the calculations of the former shall
prevail. The Indenture Trustee shall promptly thereafter send a copy of the Grid
bearing its calculations to the Holder, who shall endorse the Indenture
Trustee's calculations on the original Exhibit A to the Floating Rate Note, and
send a copy thereof, so noted, to the Indenture Trustee, who, in turn, shall
promptly send a copy thereof to the Secretary.
(e) CONCERNING SECTION 2.01. Section 2.01(c) and (e) are revised to read
as follows:
(c) The principal and interest and any premium due on the
Obligations shall be paid by (i) the Indenture Trustee or (ii)
a Paying Agent, out of funds it receives from the Shipowner,
by (x) certified or official bank check mailed by first class
postage prepaid to the addresses of the Obligees appearing on
the Obligation Register or (y) at the request of an Obligee,
received by the Indenture Trustee at least three (3) Business
Days prior to the date of payment, by wire transfer to a
commercial bank in the United States or by credit to an
account maintained by the Obligee with the Indenture Trustee
without presentment of the Obligation. Prior to any sale,
assignment or transfer of such Obligation, the Holder is
required to present the Obligation to the Indenture Trustee so
that a proper notation of all principal payments under
subparagraph (y) above are made on the Obligation.
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(e) If the Maturity of any Obligation or an Interest
Payment Date for any Obligation shall be a day other than a
Business Day, then such payment may be made on the next
succeeding Business Day, with the same force and effect as if
made on the Interest Payment Date for such payment; provided,
however, that interest shall accrue thereon for the period
after said Interest Payment Date (whether or not such next
succeeding Business Day occurs in a succeeding month).
(f) CONCERNING SECTION 2.02. Prior to the earliest of (i) January 15,
2008, (ii) four (4) years from the Delivery Date, or (iii) at the request of the
Secretary, fifteen (15) Business Days from the date the Trigger Event shall
occur, the Shipowner and the Indenture Trustee may enter into a Supplemental
Indenture, and the Indenture Trustee may enter into a supplement to the
Authorization Agreement, pursuant to Section 2.02 of Exhibit 1 to this
Indenture, to provide for the issuance of fixed rate obligations in the form of
Exhibit 3 hereto for the purpose of repaying the Floating Rate Note and/or
financing an amount equal to the Available Amount (which amount shall be
deposited into the Escrow Fund established by the Security Agreement); provided
however, that the Shipowner and Indenture Trustee have obtained the prior
written consent of the Secretary and further provided, that (a) except for the
final issuance or in the case of the Trigger Event, each issuance of a Fixed
Rate Note must be in a minimum aggregate principal amount of $50,000,000, and
(b) the proceeds from the issuance of Fixed Rate Notes shall be used to pay off,
satisfy and cancel the Floating Rate Note; provided, however, that in the
absence of the Trigger Event during the Construction Period, the Floating Rate
Note need not be paid off in its entirety and need only be reduced by the net
proceeds from the issuance of the Fixed Rate Notes.
(g) CONCERNING SECTION 2.07.
(i) The first sentence of Section 2.07(c) is revised to read as follows:
(c) The Shipowner or the Indenture Trustee shall not be required to
register transfers or make exchanges of (1) Obligations for a period
of 15 days immediately prior to (A) an Interest Payment Date or (B)
any selection of Obligations to be redeemed, (2) Obligations after
demand for payment of the Guarantees and prior to the payment
thereof or rescission of such demand pursuant to Section 6.02(a), or
(3) any Obligation which has been selected for redemption in whole
or in part, except as to the unredeemed portion of any Obligation
being redeemed in part.
(ii) Section 2.07(e) is revised to read as follows:
(e) As a condition precedent to any transfer or exchange of Obligations,
the Shipowner and the Indenture Trustee may require the payment of a sum
sufficient to reimburse it for any taxes or other governmental charges
that may be imposed with respect thereto and a sum not exceeding $2.00 for
each Obligation delivered upon any such transfer or exchange.
(h) CONCERNING SECTION 2.09. With respect to clause (1) of the proviso to
Section 2.09 of Exhibit 1 to the Indenture, a written agreement of indemnity
which is satisfactory in form and substance to the Secretary, the Shipowner, and
the Indenture Trustee, executed and delivered by an institutional Holder having
a capital and surplus of at least $100,000,000 shall be considered sufficient
indemnity to the Secretary, the Shipowner, and the Indenture Trustee in
connection with the execution, authentication
36
and delivery of any new Obligations or the making of any payment as contemplated
by said Section 2.09.
(i) CONCERNING PAYMENT OF THE OBLIGATIONS. Notwithstanding anything to the
contrary in Exhibit 1 hereto, the Obligations to be issued hereunder shall be
payable as to principal, premium (if any), and interest, at an office or agency
maintained by the Shipowner for such purpose at the Corporate Trust Office of
the Indenture Trustee, or at the option of the Shipowner, as to payments of
principal, premium (if any), or interest by wire, in immediately available
funds, by such Corporate Trust Office to the Obligees as appear in the
Obligation Register, subject to the Indenture Trustee's receipt, by not later
than 11:00 am on the due date thereof, of funds sufficient for the payment of
principal, premium (if any) or interest by wire or other immediately available
funds. The Indenture Trustee shall have no obligation to determine whether such
wires or payments were received by the Obligees.
(j) CONCERNING SECTION 3.02. Section 3.02(c) and (e) are revised to read
as follows:
(c) Scheduled Redemptions. If the Obligations of any series and Stated
Maturity or the Special Provisions hereof or the Supplemental Indenture
establishing such series shall so provide, such Obligations shall be
subject to (i) scheduled redemption through the operation of a mandatory
redemption schedule, in such amounts, at such times and subject to such
credits (if any) as may be specified therein, and (ii) redemption at the
option of the Shipowner, in connection with the operation of any such
mandatory redemption schedule, in such additional amounts and subject to
such conditions as may be specified therein.
(e) Adjustments of Redemption Payments. If the Obligations of any series
and Stated Maturity or the Special Provisions hereof or of the
Supplemental Indenture establishing such series provide for an adjustment
in scheduled redemption payments as a result of any redemption or
cancellation of Obligations, the Shipowner shall recompute the remaining
scheduled redemption payments pursuant to such provisions and shall, at
least 60 days prior to the next Interest Payment Date which occurs at
least 60 days following any such redemption or cancellation of Obligations
of such series requiring such recomputation, submit to the Secretary for
his review such recomputation to ascertain compliance with the provisions
of such Obligations or the Special Provisions hereof or such Supplemental
Indenture, and table of revised mandatory redemption schedule payments on
the Obligations of such series reflecting the adjustments made pursuant to
such provisions as a result of such redemption or cancellation. Upon
advice by the Secretary that he finds such recomputation to comply with
such provisions, the Shipowner shall submit said table to the Indenture
Trustee and the Indenture Trustee shall promptly send a copy thereof to
each Holder of an Obligation of such series.
(k) CONCERNING SECTION 3.04. Section 3.04 is revised to read as follows:
SECTION 3.04. Redemptions to Comply with Section 1104A(b)(2) of the
Act. The Shipowner and the Secretary may Request a Redemption Date, at
least forty (40) days but not more than sixty (60) days from the Indenture
Trustee's receipt of the Request, for the redemption of certain
Obligations because the principal amount of the Outstanding Obligations is
in excess of the amount eligible for guarantee by the United States under
Section 1104A(b)(2) of the Act. Upon receipt, the Indenture Trustee shall
promptly give notice to the Holders of the Redemption Date as provided in
Section 3.08 and on that date shall redeem,
37
out of funds it receives from the Shipowner, the principal amount of
Obligations specified in the instruction together with the interest
accrued thereon.
(l) CONCERNING SECTION 3.05. Section 3.05 is revised to read as follows:
SECTION 3.05. Redemption after Total Loss, Requisition of Title,
Seizure or Forfeiture of a Vessel or Termination of Certain Contracts. The
Shipowner and the Secretary may Request a Redemption Date, at least forty
(40) days but not more than sixty (60) days from the Indenture Trustee's
receipt of the Request, for the redemption of certain Obligations because
of (1) an actual, constructive, agreed or compromised total loss of a
Vessel, (2) requisition of title to, or seizure or forfeiture of a Vessel
or (3) termination of a primary Construction Contract. Upon receipt, the
Indenture Trustee shall promptly give notice to the Holders of the
Redemption Date as provided in Section 3.08 and on that date shall redeem,
out of funds it receives from the Shipowner, such principal amount of
Obligations together with the interest accrued thereon.
(m) CONCERNING SECTION 3.06. Section 3.06 is revised to read as follows:
SECTION 3.06. Redemption After Assumption by the Secretary. At any
time after the Secretary has assumed the Obligations under Section 6.09 of
the Indenture, the Secretary may Request a Redemption Date, at least forty
(40) days but not more than sixty (60) days from the Indenture Trustee's
receipt of the Request, for the redemption of all or part of the
Obligations. Upon receipt, the Indenture Trustee shall promptly give
notice to the Holders of the Redemption Date as provided in Section 3.08
and on that date shall redeem, out of funds it receives from the
Shipowner, such principal amount of Obligations together with the interest
accrued thereon.
(n) CONCERNING SECTION 3.07. Notwithstanding the provisions of Section
3.07 of Exhibit 1 to this Indenture, if less than all of the Obligations are to
be redeemed under any of the provisions contained or referred to in Article
Fourth hereof (excluding Section 4 (c) or Article III of said Exhibit 1), the
Indenture Trustee shall select such Obligations to be redeemed on the Redemption
Date by allocating the principal amount to be redeemed first between each
maturity of Obligations in proportion to the Outstanding Obligations and second
among the holders of each maturity of Obligations in proportion to the aggregate
principal amount of such maturity of Obligations registered in their respective
names; provided that, the Indenture Trustee may select for redemption portions
of the principal amount of the Obligations of a denomination larger than $1,000;
but the portions of the principal amount of the Obligations so selected shall be
equal to $1,000 or an integral multiple thereof.
(o) CONCERNING SECTION 3.09. The second sentence of Section 3.09 is
revised to read as follows:
Failure to so deposit the amounts with the Indenture Trustee or the
Paying Agent shall render any notice to redeem of no effect, and the
Indenture Trustee shall so advise the Holders.
(p) CONCERNING SECTION 4.01. Section 4.01(b) of Exhibit 1 hereto is hereby
amended in its entirety to read as follows:
38
"(b) Cash held by the Indenture Trustee or any Paying Agent (other
than the Shipowner) under this Indenture -
(i) need not be segregated;
(ii) shall not be invested except as permitted by clause (iv)
of this Section 4.01(b);
(iii) shall not bear interest except as the Shipowner and the
Indenture Trustee (or such Paying Agent) may agree in writing;
and
(iv) if the Shipowner shall have deposited or caused to be
deposited with the Indenture Trustee funds sufficient for the
payment of the Obligations at their Maturity, including
interest to the date of Maturity, and the date of Maturity is
more than one (1) Business Day after the deposit of such funds
(or the next Business Day if the deposit of such funds is made
by 11:00 a.m. on the Business Day prior to the date of
Maturity), the Indenture Trustee upon the Request of the
Shipowner shall invest such funds, as directed by the
Shipowner in writing, in direct obligations of the United
States Government maturing at or prior to the date of Maturity
of such Obligations and having a principal amount equal to not
less than the amount of the funds so invested. Such
investments shall be held in trust for the purpose for which
the funds so invested were held. After the Obligations in
respect of which the funds were deposited have been paid in
full (except as to unclaimed amounts as referred to in Section
4.03) any of such funds (including interest received in
respect of such investments and gain on matured investments
purchased at a discount) held by the Indenture Trustee in
excess of amounts to which Holders of such Obligations are
entitled shall upon the Request of the Shipowner be paid by
the Indenture Trustee to the Shipowner but only in the absence
of an Indenture Default hereunder."
(q) CONCERNING SECTION 4.02. (i) The appointment of a Paying Agent by the
Shipowner is subject to the prior written consent of the Secretary and Indenture
Trustee, which consent shall not be unreasonably withheld.
(ii) Section 4.02(a)(3) is revised to read as follows:
(3) promptly, and in no event later than five (5) days after
any payment made by it hereunder, give written notice to a Responsible
Officer in the Corporate Trust Office of all payments of Obligations made
by it, including and identifying all endorsements of payment made on
Obligations by it, signed and containing the specified information as
provided in subparagraph (2) above, and deliver for cancellation to the
Indenture Trustee all Obligations surrendered to the Paying Agent.
(r) CONCERNING SECTION 4.03. Section 4.03 is revised to read as follows:
39
SECTION 4.03. Unclaimed Amounts. Any moneys received by the Indenture
Trustee or a Paying Agent, for the payment of Obligations or Guarantees
and remaining unclaimed by the Holders thereof for six (6) years after the
date of the Maturity of said Obligations or the date of payment by the
Secretary of the Guarantees shall, upon delivery to the Indenture Trustee
of a Request by the Shipowner, be paid to the Shipowner (unless the
Secretary has previously paid the Guarantees, in which case it shall be
paid only upon a request by the Secretary); provided that, not less than
thirty (30) days prior to such payment, the Shipowner shall publish notice
thereof to the Obligees at least once in the Authorized Newspapers and
provide the Indenture Trustee with a copy thereof. In such event, such
Holders shall thereafter be entitled to look only to the Shipowner (and
the settlor or settlors of any trust for which the Shipowner is trustee,
to the extent paid over to it or them) for the payment thereof, and the
Indenture Trustee or such Paying Agent, as the case may be, shall
thereupon be relieved from all responsibility to such Holders therefor. No
such Request, publication or payment shall be construed to extend any
statutory period of limitations which would have been applicable in the
absence of such Request, publication or payment.
(s) CONCERNING SECTION 5.02. Section 5.02 is revised to read as follows:
SECTION 5.02. Payment and Procedure for Payment of Obligations. The
Shipowner shall duly and punctually pay the principal of (and premium, if
any) and interest on the Obligations according to the terms thereof and of
this Indenture. The Shipowner shall deposit with the Indenture Trustee or
(subject to Section 3.09) a Paying Agent no later than 11:00 a.m. in
Baltimore, Maryland on each date fixed for such payment or as otherwise
provided by the Special Provisions hereof an amount in immediately
available funds sufficient for such payment (after taking into account any
amounts then held by the Indenture Trustee or such Paying Agent and
available for such payment) with irrevocable directions to it to so apply
the same;
(t) CONCERNING SECTION 6.05. Section 6.05 is revised to read as follows:
SECTION 6.05. Rights of Indenture Trustee after Indenture Default. During
the continuance of any Indenture Default, the Indenture Trustee shall have
the right to demand and to receive payment of the Guarantees and shall
have, with the consent of the Secretary as to matters other than the
enforcement of the Guarantees (unless all the Guarantees shall have
terminated as provided herein):
(a) the right (in its name, as the trustee of an express
trust, or as agent and attorney-in-fact for each Holder of the Obligations
as a class) to take all action to enforce its rights and remedies
(including the institution and prosecution of all judicial and other
proceedings and the filings of proofs of claim and debt in connection
therewith), and to enforce all existing rights of the Holders of the
Obligations as a class; and
(b) all other rights and remedies granted to the Indenture
Trustee by this Indenture, or the Authorization Agreement, or by law.
In addition, during the continuance of an Indenture Default and if
all the Guarantees shall have terminated, except by payment of the
Guarantees, as provided herein, the Indenture Trustee shall have the
right, by written notice to
40
the Shipowner, to declare the entire unpaid principal amount of the
Outstanding Obligations and all unpaid interest to be immediately due and
payable.
In the event the Shipowner shall be unable to pay its debts when and
as they fall due or shall admit in writing its inability to pay its debts
as they fall due or shall become insolvent; or the Shipowner shall apply
for or consent to the appointment of any liquidator, receiver, trustee or
administrator for all or a substantial part of its business, properties,
assets or revenues; or a liquidator, receiver, trustee or administrator
shall be appointed for the Shipowner and such appointment shall continue
undismissed, undischarged or unstayed for a period of thirty (30) days, or
the Shipowner shall institute (by petition, application, answer, consent
or otherwise) any bankruptcy, arrangement, readjustment of debt,
dissolution, liquidation or similar executory or judicial proceeding; or a
bankruptcy, arrangement, readjustment of debt, dissolution, liquidation or
similar executory or judicial proceeding shall be instituted against the
Shipowner and shall remain undismissed, undischarged or unstayed for a
period of thirty (30) days, the entire unpaid principal amount of the
Outstanding Obligations and all unpaid interest shall be automatically due
and payable.
(u) CONCERNING SECTION 6.06. Section 6.06 is revised to read as follows:
SECTION 6.06. (a) Obligees' Right to Direct Indenture Trustee after
Indenture Default. During the continuance of any Indenture Default, the
Holders of a majority in principal amount of the Outstanding Obligations
shall have the right, by an Act of Obligees, to direct the Indenture
Trustee:
(1) to exercise or to refrain from exercising any right or to
enforce any remedy granted to it by this Indenture; and
(2) to direct the time, method and place of the exercise of
any such right or the enforcement of any such remedy;
provided that, subject to Section 7.03, the Indenture Trustee shall have
the right not to take any such action if it shall determine in good faith
that the action would involve it in personal liability, would subject it
to expense and liability against which it had not been offered sufficient
indemnity, or would be unjustly prejudicial to the Obligees not parties to
such direction.
Anything in this Section 6.06(a) to the contrary notwithstanding, the
Indenture Trustee shall be obligated to demand payment of the Guarantees
as provided in Section 6.02(a) unless the Holders of all Outstanding
Obligations shall have elected to terminate the Guarantees as provided in
Section 6.04(a)(2), in which case the Indenture Trustee shall be obligated
to refrain from making such demand.
(b) Limitations on Obligees' Right to Xxx. No Obligee shall have the
right to institute any judicial or other proceedings under this
Indenture unless:
(1) the Indenture Trustee shall have been directed to
institute such proceeding by the Holders of at least 25% in
aggregate principal amount of the Obligations then
Outstanding;
41
(2) the Indenture Trustee shall have been offered
sufficient indemnity and security against the costs, expenses
and liabilities to be incurred by compliance with such
direction;
(3) the Indenture Trustee shall not have instituted such
proceeding within sixty (60) days after the receipt of both
such direction and such offer of security and indemnity;
(4) no direction inconsistent with such request shall
have been given to the Indenture Trustee during such 60-day
period by the Holders of a majority in principal amount of the
Outstanding Obligations; and
(5) the institution and prosecution of such proceeding
would not result in an impairment of the rights of any other
Obligee, it being understood and intended that no one or more
Obligees shall have any right in any manner whatever by virtue
of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other Obligees
or to obtain or to seek to obtain priority or preference over
any other Obligees or to enforce any right under this
Indenture, except in the manner herein provided and for the
equal and ratable benefit of all the Obligees.
(c) Unconditional Right of Obligees to Xxx for Principal (and
Premium, if any) and Interest. Nothing in paragraph (b) shall (i) affect
the obligation of the Shipowner to pay the principal of (and premium, if
any) and interest on the Obligations in accordance with their terms or
affect the right of any Obligee to institute any judicial or other
proceeding to enforce the payment of his Obligations, or (ii) limit the
right of any Obligee to demand payment of the Guarantees pursuant to
Section 6.02(b) or to institute any judicial or other proceeding to
enforce the payment of the Guarantee of any Obligation of which he is the
Holder.
(v) CONCERNING SECTION 6.07. Section 6.07 is revised to read as follows:
SECTION 6.07. Attorneys' Fees and Costs. In any proceeding for the
enforcement of any right or remedy under this Indenture, or in any
proceeding against the Indenture Trustee for any action taken or omitted
by it as Indenture Trustee, the court may in its discretion assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant, having due regard to the merits and good faith of the claims or
defense made by such party litigant. The provisions of this Section shall
not apply to any proceeding instituted by the Indenture Trustee or any
proceeding instituted by any Obligee against the Secretary for the payment
of the principal of (and premium, if any) and interest on the Obligations.
(w) CONCERNING SECTION 6.09. The following paragraph is added at the end
of Section 6.09:
In the event that the Obligations are registered in the name of The
Depository Trust Company ("DTC"), Cede & Co. ("Cede") or another nominee
of DTC or Cede pursuant to a Letter of Representations ("LOR") which is
executed among the Shipowner, the Indenture Trustee and DTC, and (i) if
the Secretary assumes the Obligations pursuant to Section 6.09(a) hereof,
or (ii) if the Secretary
42
instructs the Shipowner and the Indenture Trustee to terminate the LOR,
the Shipowner and the Indenture Trustee, immediately upon receipt of
notice of such assumption or upon receipt of notice of such termination,
shall terminate or cause the termination of the LOR in accordance with
Section 18 thereof. The Indenture Trustee shall within 30 days from
receipt of either such notice from the Secretary also instruct DTC to
notify its direct and indirect participants of the need to re-register the
Obligations in the names of the beneficial owners. Upon surrender by DTC
of the Obligations issued in its name, the name of Cede or another
nominee, the Shipowner shall issue at its sole expense, and the Indenture
Trustee shall authenticate Obligations in the names provided to the
Indenture Trustee by DTC.
(x) CONCERNING SECTION 7.03. Section 7.03(h) and (n) are revised to read
as follows:
(h) In all cases where this Indenture does not make express provision as
to the evidence on which the Indenture Trustee may act or refrain from
acting, the Indenture Trustee shall be entitled to receive and shall be
protected (subject to paragraph (c) of this Section) in acting or
refraining from acting hereunder in reliance upon an Officer's Certificate
as to the existence or non-existence of any fact.
(n) No provision of this Indenture shall require the Indenture Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers.
(y) CONCERNING SECTION 7.04. Section 7.04 is revised to read as follows:
SECTION 7.04. Compensation, Expenses and Indemnification of Indenture
Trustee. The Shipowner shall (1) pay such compensation to the Indenture
Trustee as they may agree upon in writing from time to time and reimburse
it for its reasonable expenses and disbursements (including counsel fees
and expenses), and (2) indemnify the Indenture Trustee for, and hold it
harmless against, any loss, liability or expense which it may incur or
suffer without negligence or bad faith in acting under this Indenture or
the Authorization Agreement. The compensation of the Indenture Trustee
shall not be limited to the compensation provided by law for a trustee
acting under an express trust. The obligations of the Shipowner under this
Section 7.04 shall survive the termination of the Indenture and
resignation or removal of the Indenture Trustee.
(z) CONCERNING SECTION 7.07. Section 7.07 is revised to read as follows:
SECTION 7.07. Effect of Appointment of Successor Indenture Trustee.
Each successor Indenture Trustee shall forthwith, without further act or
deed, succeed to all the rights and duties of its predecessor in trust
under this Indenture and the Authorization Agreement. Upon the written
request of the successor Indenture Trustee or the Shipowner and upon
payment by the Shipowner of all amounts due to such predecessor Indenture
Trustee under this Indenture, such predecessor Indenture Trustee shall
promptly deliver to such successor Indenture Trustee all sums held
hereunder, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the
successor Indenture Trustee under this Indenture and shall transfer,
assign and confirm to the successor Indenture Trustee all its rights under
this Indenture in such manner as deemed by such
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successor Indenture Trustee or the Shipowner to be necessary or
appropriate in connection therewith and the predecessor Indenture Trustee
shall have no liability for any actions taken by the successor Indenture
Trustee.
(aa) CONCERNING SECTION 9.01. Section 9.01(a) is revised to read as
follows:
(a) Except as herein otherwise expressly provided, an Act of
Obligees shall become effective when it is delivered to the
Indenture Trustee and, where it is expressly required, to the
Shipowner and the Secretary. Proof of execution of any instrument
appointing an agent or attorney to execute an Act of Obligees made
in the manner of subsection (b) below shall be sufficient and
conclusive for any purpose of this Indenture.
(bb) CONCERNING SECTION 12.01. Section 12.01(a) is revised to read as
follows:
SECTION 12.01. Satisfaction and Discharge of Indenture. Whenever all
Outstanding Obligations authenticated and delivered hereunder shall have
been Retired or Paid the Indenture Trustee shall forthwith deliver to the
Shipowner and the Secretary a duly executed instrument, in form submitted
to it by the Shipowner and reasonably satisfactory to the Secretary and
the Indenture Trustee, satisfying and discharging this Indenture and, at
the time such form of instrument is submitted to the Indenture Trustee the
Shipowner shall deliver to the Indenture Trustee an Officer's Certificate
and an Opinion of Counsel each stating that all conditions precedent
herein provided relating to the satisfaction and discharge of this
Indenture have been complied with. Notwithstanding the satisfaction and
discharge of this Indenture, the Obligations of the Shipowner to the
Indenture Trustee under Section 7.04 shall survive.
(cc) CONCERNING REGISTERED AND BENEFICIAL OWNERSHIP OF THE OBLIGATIONS;
LEGENDS.
(i) The Fixed Rate Notes may be issued initially in the form
of one or more permanent global Notes in definitive, fully
registered form without interest coupons (each, a "Global
Obligation"). Except as provided in paragraph (iii) below,
owners of beneficial interests in Global Obligations
("Obligation Owners") shall not be entitled to receive
separate certificated Notes ("Definitive Obligation") and
shall not be considered the holders thereof. Each such Global
Obligation shall be deposited with The Depository Trust
Company (the "DTC") or the Indenture Trustee, as custodian for
DTC, registered in the name of DTC or a nominee of DTC, and
duly executed by
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the Shipowner and authenticated by the Indenture Trustee as
provided in the Indenture. Each Global Obligation shall bear
such legend as DTC may require.
(ii) Members of, or participants in, DTC shall have no rights
under the Indenture with respect to any Global Obligation held on their
behalf by DTC or by the Indenture Trustee, as the custodian of DTC, or
under such Global Obligation, and DTC may be treated by the Shipowner, the
Indenture Trustee and any agent of the Shipowner or the Indenture Trustee
as the absolute owner of such Global Obligation for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Shipowner, the Indenture Trustee or any agent of the Shipowner or the
Indenture Trustee from giving effect to any written certification, proxy
or other authorization furnished by DTC or impair, as between DTC and its
members and participants, the operation of customary practices of DTC
governing the exercise of the rights of an owner of a beneficial interest
in any Global Obligation.
(iii) (1) The transfer and exchange of Global Obligations or
beneficial interests therein shall be effected through DTC or the
Indenture Trustee, as the custodian for DTC, in accordance with the
Indenture and the procedures of DTC therefor.
(2) A Global Obligation shall be exchangeable for
Definitive Obligations registered in the names of persons owning
beneficial interest in such Global Obligation only if any of the following
events shall have occurred: (1) DTC notifies the Shipowner, with a copy to
the Indenture Trustee, that it is unwilling or unable to continue as
depositary for such Global Obligation or DTC ceases to be a clearing
agency registered under the Securities Exchange Act of 1934, as amended,
at a time when DTC is required to be so registered in order to act as
depositary, and a successor depositary is not appointed by the Shipowner
within 90 days thereafter, (2) the Shipowner or the Indenture Trustee
elects to terminate DTC's services or the book entry system, (3) the
Secretary assumes the Obligations, or (4) the Secretary instructs the
Shipowner and Indenture Trustee to terminate the Letter of
Representations.
(3) Any Global Obligation that is exchangeable for
Definitive Obligations registered in the name of the owners of beneficial
interests therein pursuant to this paragraph (iii) shall be surrendered by
DTC to the Indenture Trustee to be so exchanged, without charge, and the
Shipowner shall execute and the Indenture Trustee shall authenticate and
deliver, upon such exchange of such Global Obligation, an equal aggregate
principal amount of Definitive Obligations of authorized denominations.
Definitive Obligations issued in exchange for a beneficial interest in a
Global Obligation pursuant hereto shall be registered in such names and in
such authorized denominations as DTC, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the Indenture
Trustee in writing. The Indenture Trustee shall deliver such Definitive
Obligations to the Obligation Owners in whose names such Obligations are
so registered in accordance with the instructions of DTC.
(4) The registered holder of a Global Obligation
may grant proxies and otherwise authorize any Obligation Owner, including
DTC's members and participants and Obligation Owners that may hold
interest through such members and participants, to take any action which a
Holder is entitled to take under the Indenture or the Obligations.
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(5) In the event of the occurrence of any of the
events specified in paragraph (iii)(2), the Shipowner shall promptly make
available to the Indenture Trustee a reasonable supply of Definitive
Obligations.
(6) Notwithstanding any other provision of the
Indenture, a Global Obligation may not be transferred except as a whole by
DTC for such Global Obligation to a nominee of DTC or by a nominee of DTC
to DTC or another nominee of DTC.
(iv) At such time as all beneficial interests in a
Global Obligations have either been exchanged for Definitive Obligations,
redeemed, repurchased or canceled, such Global Obligation shall be
returned to the Indenture Trustee for cancellation or retained and
canceled by the Indenture Trustee.
(v) The Indenture Trustee shall have no responsibility
or obligation to any owner of a beneficial interest in a Global
Obligation, a member of, or a participant in DTC or any other Obligation
Owner with respect to the accuracy of the records of DTC or its nominee or
of any participant or member thereof, with respect to any ownership
interest in the Obligations or with respect to the delivery to any
participant, member, beneficial owner or other Obligation Owner (other
than DTC) of any notice (including any notice of redemption) or the
payment of any amount or delivery of any Obligations (or other security or
property) under or with respect to such Obligations. All notices and
communications to be given to the Holders and all payments to be made to
Holders in respect to the Obligations shall be given or made only to or
upon the order of the registered Holders (which shall be DTC or its
nominee in the case of a Global Obligation). The rights of owners of
beneficial interests in any Global Obligation shall be exercised only
through DTC subject to the applicable rules and procedures of DTC. The
Indenture Trustee may rely and shall be fully protected in relying upon
information furnished by DTC with respect to its members, participants and
any beneficial owners.
6. MISCELLANEOUS.
(a) CONCERNING NOTICES. Subject to the provisions of Section 13.01 of
Exhibit 1 to this Indenture, any notice, request, demand, direction, consent,
waiver, approval or other communication to be given to a party hereto or the
Secretary, shall be deemed to have been sufficiently given or made when
addressed to:
The Indenture Trustee as: ALLFIRST TRUST COMPANY,
NATIONAL ASSOCIATION
00 Xxxxx Xxxxxxx Xx.
00xx Xxxxx
(Mail Code 101-591)
Xxxxxxxxx, XX 00000
The Shipowner as: ROWAN COMPANIES, INC.
Suite 5450
0000 Xxxx Xxx Xxxxxxxxx
00
Xxxxxxx, Xxxxx 00000-0000
Attn: Chief Financial Officer
The Secretary as: SECRETARY OF TRANSPORTATION
c/o Maritime Administrator
U.S. Department of Transportation
000 Xxxxxxx Xxxxxx, XX
Xxxxxxxxxx, X.X. 00000
(b) CONCERNING APPLICABLE LAW. This Indenture and each Obligation shall be
governed by the federal laws of the United State of America, but to the extent
that they are inapplicable by the laws of the State of New York.
(c) EXECUTION OF COUNTERPARTS. This Indenture may be executed in any
number of counterparts. All such counterparts shall be deemed to be originals,
and shall constitute but one and the same instrument.
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IN WITNESS WHEREOF, this Trust Indenture has been duly executed by the
parties hereto as of the day and year first above written.
(SEAL) ROWAN COMPANIES, INC.
Shipowner
ATTEST:
Xxxx X. Xxx By X. X. Xxxxxx
----------------------------- ----------------------------------
Secretary Senior Vice President
ALLFIRST TRUST COMPANY
NATIONAL ASSOCIATION
Indenture Trustee
ATTEST:
Xxxxxx X. Xxxxx By: Xxxxxx X. Xxxxxxxx
----------------------------- ---------------------------------
Vice President Vice President
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