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EXHIBIT 10.1
$400,000,000
R&B FALCON CORPORATION
$100 MILLION 9 1/8% SENIOR NOTES DUE 2003
$300 MILLION 9 1/2% SENIOR NOTES DUE 2008
PURCHASE AGREEMENT
December 17, 1998
CREDIT SUISSE FIRST BOSTON CORPORATION
NATIONSBANC XXXXXXXXXX SECURITIES LLC
PARIBAS CORPORATION
c/o Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, X.X. 10010-3629
Dear Sirs:
1. Introductory. R&B Falcon Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several initial purchasers named in Schedule A hereto (the
"Purchasers") $100 million aggregate principal amount of its 9 1/8% Senior Notes
due 2003 (the "5-Year Notes"), and $300 million aggregate principal amount of
its 9 1/2% Senior Notes due 2008 (the "10-Year Notes" and, collectively with the
5-Year Notes, the "Offered Securities") to be issued under an indenture to be
dated as of December 22, 1998 (the "Indenture") between the Company and Chase
Bank of Texas, National Association, as Trustee (the "Trustee"). The Company
will also enter into an amended revolving credit agreement (the "Amended Bank
Facility") effective simultaneously with the closing of the sale of Offered
Securities. The United States Securities Act of 1933, as amended, is herein
referred to as the "Securities Act."
The Company hereby agrees with the several Purchasers as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with the several Purchasers that:
(a) A preliminary offering circular and an offering circular
relating to the Offered Securities to be offered by the Purchasers have been
prepared by the Company. Such preliminary
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offering circular and offering circular, as supplemented as of the date of this
Agreement, together with any other document approved by the Company for use in
connection with the contemplated resale of the Offered Securities are
hereinafter collectively referred to as the "Offering Document." On the date of
this Agreement, the Offering Document does not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. The preceding sentence does not apply to statements in or
omissions from the Offering Document based upon written information furnished to
the Company by any Purchaser through Credit Suisse First Boston Corporation
("CSFBC") specifically for use therein, it being understood and agreed that the
only such information is that described as such in Section 7(b) hereof. On the
date of this Agreement, (i) the Company's Annual Report on Form 10-K most
recently filed with the Securities and Exchange Commission (the "Commission")
and all subsequent reports (collectively, the "Exchange Act Reports") which have
been filed by the Company with the Commission or sent to shareholders pursuant
to the Securities Exchange Act of 1934 (the "Exchange Act") and (ii) the Annual
Report on Form 10-K of Cliffs Drilling Company, a Delaware corporation
("Cliffs"), most recently filed with the Commission and all subsequent reports
("Cliffs Exchange Act Reports") which have been filed by Xxxxxx with the
Commission or sent to Cliffs' shareholders pursuant to the Exchange Act do not
include any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. Such documents, when they were filed
with the Commission, conformed in all material respects to the applicable
requirements of the Exchange Act and the applicable rules and regulations of the
Commission thereunder.
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with power
and authority (corporate and other) to own its properties and conduct its
business as described in the Offering Document; and the Company is duly
qualified to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of its
business requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on the condition (financial
or other), business, properties or results of operation of the Company and its
subsidiaries taken as a whole (a "Material Adverse Effect").
(c) Each of the subsidiaries of the Company listed on Schedule
B hereto (the "Subsidiaries"), which Subsidiaries in the aggregate directly own
substantially all of the assets held by the Company and all of its subsidiaries
on a consolidated basis and which constitute all of the Company's "significant
subsidiaries" (as such term is defined in Regulation S-X under the Act), has
been duly incorporated or formed and is an existing corporation or limited
liability entity in good standing under the laws of the jurisdiction of its
incorporation or formation, with power and authority (corporate and other) to
own its properties and conduct its business as described in the Offering
Document; and each of the Subsidiaries is duly qualified to do business as a
foreign corporation or limited liability entity in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of its
business requires such qualification, except where the failure to be so
qualified would not have a Material Adverse Effect; all of the issued and
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outstanding capital stock or member interests of each Subsidiary has been duly
authorized and validly issued and is fully paid and nonassessable; and the
capital stock or member interests of each Subsidiary is owned directly or
indirectly by the Company free from liens, encumbrances and defects.
(d) The Indenture has been duly authorized; the Offered
Securities have been duly authorized; and when the Offered Securities are
executed and authenticated in accordance with the terms thereof and delivered
and paid for pursuant to this Agreement on the Closing Date (as defined below),
the Indenture will have been duly executed and delivered, such Offered
Securities will have been duly executed, issued and delivered and will conform
to the description thereof contained in the Offering Document and the Indenture
and such Offered Securities will constitute valid and legally binding
obligations of the Company enforceable against the Company in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles.
(e) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or any Purchaser for a
brokerage commission, finder's fee or other like payment in connection with the
sale of the Offered Securities.
(f) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required for (i)
the consummation of the transactions contemplated by this Agreement and the
Registration Rights Agreement, dated the date hereof, between the Company and
the Purchasers (the "Registration Rights Agreement") in connection with the
issuance and sale of the Offered Securities by the Company or (ii) the
execution, performance and delivery of the Amended Bank Facility, except such as
may be required under state securities laws and except for such filings with the
Securities and Exchange Commission as are required in connection with the
Registration Rights Agreement.
(g) Neither the execution, delivery and performance of the
Indenture, the Registration Rights Agreement and this Agreement, and the
issuance and sale of the Offered Securities and compliance with the terms and
provisions thereof nor the execution, delivery and performance of the Amended
Bank Facility will result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any rule, regulation
or order of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any Subsidiary or any of its properties,
or any agreement or instrument to which the Company or any Subsidiary is a party
or by which the Company or any Subsidiary is bound or to which any of the
properties of the Company or any Subsidiary is subject, or the Certificate of
Incorporation or other organizational documents and Bylaws of the Company and
each of the Subsidiaries, and the Company has full power and authority to
authorize, issue and sell the Offered Securities as contemplated by this
Agreement.
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(h) Each of this Agreement, Registration Rights Agreement and
the Amended Bank Facility has been duly authorized, executed and delivered by
the Company.
(i) The Amended Bank Facility has been executed by the
Required Lenders (as such term is defined in the Company's credit agreement,
dated April 24, as amended).
(j) Except as disclosed in the Offering Document or as would
not have a Material Adverse Effect, the Company and the Subsidiaries have good
and marketable title to all real properties and all other properties and assets
owned by them, in each case free from liens, encumbrances and defects that would
materially affect the value thereof or materially interfere with the use made or
to be made thereof; and except as disclosed in the Offering Document or as would
not have a Material Adverse Effect, the Company and the Subsidiaries hold any
leased real or personal property under valid and enforceable leases.
(k) The Company and the Subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by them and have not
received any notice of proceedings relating to the revocation or modification of
any such certificate, authority or permit that, if determined adversely to the
Company or any Subsidiary, would individually or in the aggregate have a
Material Adverse Effect.
(l) No labor dispute with the employees of the Company or any
Subsidiary exists or, to the knowledge of the Company, is imminent that should
reasonably be expected to have a Material Adverse Effect.
(m) The Company and its subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and the rights to
inventions, know-how, patents, copyrights, confidential information and other
intellectual property (collectively, "intellectual property rights") necessary
to conduct the business currently conducted by them, or presently employed by
them, and have not received any notice of infringement of or conflict with
asserted rights of others with respect to any intellectual property rights that,
if determined adversely to the Company or any Subsidiary, would individually or
in the aggregate have a Material Adverse Effect.
(n) None of the Company or any Subsidiary is in violation of
any statute, any rule, regulation, decision or order of any governmental agency
or body or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, "environmental laws"), owns or operates any real
property contaminated with any substance that is subject to any environmental
laws, is liable for any off-site disposal or contamination pursuant to any
environmental laws, or is subject to any claim relating to any environmental
laws, which violation, contamination, liability or claim would individually or
in the aggregate have a Material Adverse Effect; and none of the Company and any
Subsidiary is aware of any pending investigation which might lead to such a
claim.
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(o) There are no pending actions, suits or proceedings against
or affecting the Company, the Subsidiaries or any of their respective properties
that, if determined adversely to the Company and the Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company to perform its
obligations under this Agreement, the Indenture, the Registration Rights
Agreement or the Amended Bank Facility, or which are otherwise material in the
context of the sale of the Offered Securities; and no such actions, suits or
proceedings are threatened.
(p) The financial statements included in the Offering Document
present fairly, in all material respects, the financial position of the Company
and its consolidated subsidiaries as of the dates shown and their results of
operations and cash flows for the periods shown, and such financial statements
have been prepared in conformity with the generally accepted accounting
principles in the United States applied on a consistent basis.
(q) Since the date of the latest audited financial statements
included in the Offering Document there has been no material adverse change, nor
any development or event involving a prospective material adverse change, in the
condition (financial or other), business, properties or results of operations of
the Company and the Subsidiaries taken as a whole, and there has been no
dividend or distribution of any kind declared, paid or made by the Company.
(r) The Company is not an open-end investment company, unit
investment trust or face-amount certificate company that is or is required to be
registered under Section 8 of the United States Investment Company Act of 1940
(the "Investment Company Act"); and the Company is not and, after giving effect
to the offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Offering Document, will not be an
"investment company" as defined in the Investment Company Act.
(s) No securities of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as the Offered Securities are listed
on any national securities exchange registered under Section 6 of the Exchange
Act or quoted in a U.S. automated inter-dealer quotation system.
(t) Assuming the accuracy of the representation of the
Purchasers contained in Section 4 hereof, the offer and sale of the Offered
Securities in the manner contemplated by this Agreement will be exempt from the
registration requirements of the Securities Act by reason of Section 4(2)
thereof, Regulation D thereunder and Regulation S thereunder ("Regulation S");
and prior to the effectiveness of a registration statement as contemplated in
the Registration Rights Agreement, it is not necessary to qualify an indenture
in respect of the Offered Securities under the United States Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act").
(u) None of the Company or any of its affiliates, or any
person acting on its or their behalf (other than the Purchasers, with respect to
which the Company makes no representation) (i) has, within the six-month period
prior to the date hereof, offered or sold in the United States or to any U.S.
person (as such terms are defined in Regulation S under the Securities Act) the
Offered
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Securities or any security of the same class or series as the Offered Securities
or (ii) has offered or will offer or sell the Offered Securities (A) in the
United States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act or (B)
with respect to any such securities sold in reliance on Rule 903 of Regulation S
under the Securities Act, by means of any directed selling efforts within the
meaning of Rule 902(b) of Regulation S. The Company, its affiliates and any
person acting on their behalf (other than the Purchasers, with respect to which
the Company makes no representation) have complied and will comply with the
offering restrictions requirement of Regulation S. The Company has not entered
and will not enter into any contractual arrangement with respect to the
distribution of the Offered Securities except for this Agreement and the
Registration Rights Agreement.
(v) The proceeds to the Company from the offering of the
Offered Securities will not be used to purchase or carry any security.
(w) The proceeds to the Company from the offering of the
Offered Securities will be used as described in the Offering Document.
(x) None of the Company, the Subsidiaries, any of their
respective affiliates, or any director, officer, agent, employee or other person
associated with or acting on behalf of the Company, the Subsidiaries or any of
their respective affiliates has (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to
political activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds; (iii)
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback
or other unlawful payment.
(y) The Company is subject to Section 13 or 15(d) of the
Exchange Act.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Purchasers, and the Purchasers agree, severally and not jointly, to purchase
from the Company, at respective purchase prices of (a) 100% of the principal
amount of the 5-Year Notes and (b) 100% of the principal amount of the 10-Year
Notes, in each case plus accrued interest from December 22, 1998 to the Closing
Date (as hereinafter defined) the respective principal amounts of Securities set
forth opposite the names of the several Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of one or more permanent global Securities in
registered form without interest coupons (the "Global Securities") which will be
deposited with the Trustee as custodian for The Depository Trust Company ("DTC")
and registered in the name of Cede & Co., as nominee for DTC. Interests in any
permanent global Securities will be held only in book-entry form through DTC,
except in the limited circumstances described in the Offering Document. Payment
for the Offered Securities shall be
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made by the Purchasers in Federal (same day) funds by wire transfer to an
account at a bank acceptable to CSFBC at 10:00 a.m. (New York time) on December
22, 1998, or at such other time not later than seven full business days
thereafter as CSFBC and the Company determine, such time being herein referred
to as the "Closing Date", against delivery to the Trustee as custodian for DTC
of the Global Securities representing all of the Offered Securities. The Global
Securities will be made available for checking at the offices of Xxxxxxx & Xxxxx
L.L.P., 000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, at least 24 hours
prior to the Closing Date.
4. Representations by Purchasers; Resale by Purchasers. 34. Each
Purchaser severally represents and warrants to the Company that it is an
"accredited investor" within the meaning of Regulation D under the Securities
Act.
(b) Each Purchaser severally acknowledges that the Offered
Securities have not been registered under the Securities Act and may not be
offered or sold within the United States or to, or for the account or benefit
of, U.S. persons except in accordance with Regulation S or pursuant to an
exemption from the registration requirements of the Securities Act. Each
Purchaser severally represents and agrees that it has offered and sold the
Offered Securities, and will offer and sell the Offered Securities as part of
its distribution at any time, only in accordance with Rule 903 or Rule 144A
under the Securities Act ("Rule 144A"). Accordingly, neither such Purchaser nor
its affiliates, nor any persons acting on its or their behalf, have engaged or
will engage in any directed selling efforts with respect to the Offered
Securities, and such Purchaser, its affiliates and all persons acting on its or
their behalf have complied and will comply with the offering restrictions
requirement of Regulation S. Each Purchaser severally agrees that, at or prior
to confirmation of sale of the Offered Securities, other than a sale pursuant to
Rule 144A, such Purchaser will have sent to each distributor, dealer or person
receiving a selling concession, fee or other remuneration that purchases the
Offered Securities from it during the restricted period a confirmation or notice
to substantially the following effect:
"The Securities covered hereby have not been registered under
the U.S. Securities Act of 1933 (the "Securities Act") and may
not be offered or sold within the United States or to, or for
the account or benefit of, U.S. persons as part of their
distribution at any time or except in accordance with
Regulation S (or Rule 144A if available) under the Securities
Act. Terms used above have the meanings given to them by
Regulation S."
Terms used in this subsection (b) have the meanings given to them by
Regulation S.
(c) Each Purchaser severally agrees that it and each of its
affiliates has not entered and will not enter into any contractual arrangement
with respect to the distribution of the Offered Securities except for any such
arrangements with the other Purchasers or affiliates of the other Purchasers
with the prior written consent of the Company.
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(d) Each Purchaser severally agrees that it and each of its
affiliates will not offer or sell the Offered Securities in the United States by
means of any form of general solicitation or general advertising within the
meaning of Rule 502(c) under the Securities Act, including, but not limited to
(i) any advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio, or
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising. Each Purchaser severally agrees, with
respect to resales made in reliance on Rule 144A of any of the Offered
Securities, to deliver either with the confirmation of such resale or otherwise
prior to settlement of such resale a notice to the effect that the resale of
such Offered Securities has been made in reliance upon the exemption from the
registration requirements of the Securities Act provided by Rule 144A.
(e) Each of the Purchasers severally represents and agrees
that (i) it has not offered or sold and prior to the date six months after the
date of issue of the Offered Securities will not offer or sell any Offered
Securities to persons in the United Kingdom except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995; (ii) it has complied and will comply with
all applicable provisions of the Financial Services Act 1986 with respect to
anything done by it in relation to the Offered Securities in, from or otherwise
involving the United Kingdom; and (iii) it has only issued or passed on and will
only issue or pass on in the United Kingdom any document received by it in
connection with the issue of the Offered Securities to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
5. Certain Agreements of the Company. The Company agrees with the
several Purchasers that:
(a) The Company will advise CSFBC promptly of any proposal to
amend or supplement the Offering Document and will not effect such amendment or
supplementation without CSFBC's consent, which CSFBC agrees it will not
unreasonably withhold. If, at any time prior to the completion of the resale of
the Offered Securities by the Purchasers, any event occurs as a result of which
the Offering Document as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, the Company promptly will notify CSFBC of
such event and promptly will prepare, at its own expense, an amendment or
supplement which will correct such statement or omission. Neither CSFBC's
consent to, nor the Purchasers' delivery to offerees or investors of, any such
amendment or supplement shall constitute a waiver of any of the conditions set
forth in Section 6.
(b) The Company will furnish to CSFBC copies of any
preliminary offering circular, the Offering Document and all amendments and
supplements to such documents, in each
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case as soon as available and in such quantities as CSFBC requests, and the
Company will furnish to CSFBC on the date hereof five copies of the Offering
Document signed by a duly authorized officer of the Company, one of which will
include the independent accountants' reports therein manually signed by such
independent accountants. At any time when the Company is not subject to Section
13 or 15(d) of the Exchange Act, the Company will promptly furnish or cause to
be furnished to CSFBC (and, upon request, to each of the other Purchasers) and,
upon request of holders and prospective purchasers of the Offered Securities, to
such holders and purchasers, copies of the information required to be delivered
to holders and prospective purchasers of the Offered Securities pursuant to Rule
144A(d)(4) under the Securities Act (or any successor provision thereto) in
order to permit compliance with Rule 144A in connection with resales by such
holders of the Offered Securities. The Company will pay the expenses of printing
and distributing to the Purchasers all such documents.
(c) The Company will arrange for the qualification of the
Offered Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions in the United States and Canada
as CSFBC designates and will continue such qualifications in effect so long as
required for the resale of the Offered Securities by the Purchasers, provided
that the Company will not be required to qualify as a foreign corporation or to
file a general consent to service of process in any such state.
(d) During the period of five years hereafter, the Company
will furnish to CSFBC and, upon request, to each of the other Purchasers, as
soon as practicable after the end of each fiscal year, a copy of its annual
report to stockholders for such year; and the Company will furnish to CSFBC and,
upon request, to each of the other Purchasers (i) as soon as available, a copy
of each report or financial statement furnished to or filed with the Commission
or any securities exchange on which any class of securities of either of the
Company is listed, and (ii) from time to time, such other information concerning
the Company as CSFBC may reasonably request.
(e) During the period of two years after the Closing Date, the
Company will, upon request, furnish to CSFBC, each of the other Purchasers and
any holder of Offered Securities a copy of the restrictions on transfer
applicable to the Offered Securities.
(f) During the period of two years after the Closing Date, the
Company will not, and will not permit any of its affiliates (as defined in Rule
144 under the Securities Act) to, resell any of the Offered Securities that have
been reacquired by any of them.
(g) During the period of two years after the Closing Date, the
Company will not be or become, an open-end investment company, unit investment
trust or face-amount certificate company that is or is required to be registered
under Section 8 of the Investment Company Act.
(h) The Company will pay all expenses incidental to the
performance of its obligations under this Agreement, the Indenture and the
Registration Rights Agreement, including (i) the reasonable fees and expenses of
the Trustee and its professional advisers; (ii) all expenses in
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connection with the execution, issue, authentication, packaging and initial
delivery of the Offered Securities, the preparation and printing of this
Agreement, the Offered Securities, the Registration Rights Agreement and the
Indenture, the Offering Document and amendments and supplements thereto, and any
other document relating to the issuance, offer, sale and delivery of the Offered
Securities; (iii) the cost of listing the Offered Securities and qualifying the
Offered Securities for trading in The Portal(SM) Market ("PORTAL") of The Nasdaq
Stock Market, Inc. and any expenses incidental thereto; (iv) the cost of any
advertising approved by the Company in connection with the issue of the Offered
Securities; (v) any reasonable expenses (including fees and disbursements of
counsel) incurred in connection with qualification of the Offered Securities for
sale under the laws of such jurisdictions in the United States and Canada as
CSFBC designates and the printing of memoranda relating thereto; (vi) any fees
charged by investment rating agencies for the rating of the Securities; and
(vii) any expenses incurred in distributing preliminary offering circulars and
the Offering Document (including any amendments and supplements thereto) to the
Purchasers. The Company will also pay or reimburse the Purchasers (to the extent
incurred by them) for all reasonable travel expenses of the Purchasers and the
Company's officers and employees and any other reasonable expenses of the
Purchasers and the Company in connection with attending or hosting meetings with
prospective purchasers of the Offered Securities from the Purchasers.
(i) In connection with the offering, until CSFBC shall have
notified the Company and the other Purchasers of the completion of the resale of
the Offered Securities, neither the Company nor any of its affiliates has or
will, either alone or with one or more other persons, bid for or purchase for
any account in which it or any of its affiliates has a beneficial interest any
Offered Securities or attempt to induce any person to purchase any Offered
Securities; and neither the Company nor any of its affiliates will make bids or
purchases for the purpose of creating actual, or apparent, active trading in, or
of raising the price of, the Offered Securities.
6. Conditions of the Obligations of the Purchasers. The
obligations of the several Purchasers to purchase and pay for the Offered
Securities will be subject to the accuracy of the representations and warranties
on the part of the Company herein, to the accuracy of the statements of officers
of the Company made pursuant to the provisions hereof, to the performance by the
Company and each Subsidiary of their obligations hereunder and to the following
additional conditions precedent:
(a) The Purchasers shall have received a letter, dated the
date of this Agreement, of Xxxxxx Xxxxxxxx LLP confirming that they are
independent public accountants within the meaning of the Securities Act and the
applicable published rules and regulations thereunder (the "Rules and
Regulations") and to the effect that:
(i) in their opinion the financial statements audited by them
and included in the Exchange Act Reports and incorporated by reference
in the Offering Document comply as to form in all material respects
with the applicable accounting requirements of the Securities Act and
the related published Rules and Regulations;
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(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on the unaudited
financial statements included in the Exchange Act Reports and
incorporated by reference in the Offering Document;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of the Company, inquiries of officials of the Company who have
responsibility for financial and accounting matters and other specified
procedures, nothing came to their attention that caused them to believe
that the unaudited financial statements included in the Exchange Act
Reports or incorporated by reference in the Offering Document do not
comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the related published
Rules and Regulations or any material modifications should be made to
such unaudited financial statements for them to be in conformity with
generally accepted accounting principles;
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Offering Document and the Exchange Act
Reports incorporated by reference therein (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by analysis
or computation) with the results obtained from inquiries, a reading of
such general accounting records and other procedures specified in such
letter and have found such dollar amounts, percentages and other
financial information to be in agreement with such results, except as
otherwise specified in such letter; and
(v) they have read the unaudited pro forma condensed combined
balance sheet as of September 30, 1998, and the unaudited pro forma
condensed combined statements of operations for the year ended December
31, 1997, and the nine month period ended September 30, 1998, included
in the Offering Document; inquired of certain officials of the Company
who have responsibility for financial and accounting matters about the
basis for their determination of the pro forma adjustments; and proved
the arithmetic accuracy of the application of the pro forma adjustments
to the historical amounts in the unaudited pro forma condensed combined
financial statements.
(b) The Purchasers shall have received a letter, dated the
date of this Agreement, of Ernst & Young LLP confirming that they are
independent public accountants within the meaning of the Securities Act and the
Rules and Regulations and to the effect that:
(i) in their opinion the financial statements examined by them
and included in Cliffs Exchange Act Reports and incorporated by
reference in the Offering Document
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comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the related published
Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on the unaudited
financial statements included in the Cliffs Exchange Act Reports and
incorporated by reference in the Offering Document;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of Cliffs, inquiries of officials of Cliffs who have responsibility for
financial and accounting matters and other specified procedures,
nothing came to their attention that caused them to believe that the
unaudited financial statements included in the Cliffs Exchange Act
Reports and incorporated by reference in the Offering Document do not
comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the related published
Rules and Regulations or any material modifications should be made to
such unaudited financial statements for them to be in conformity with
generally accepted accounting principles; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Offering Document and the Cliffs Exchange
Act Reports incorporated by reference therein (in each case to the
extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of Cliffs
and its subsidiaries subject to the internal controls of Cliffs'
accounting system or are derived directly from such records by analysis
or computation) with the results obtained from inquiries, a reading of
such general accounting records and other procedures specified in such
letter and have found such dollar amounts, percentages and other
financial information to be in agreement with such results, except as
otherwise specified in such letter.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) a change in U.S. or international
financial, political or economic conditions or currency exchange rates or
exchange controls as would, in the judgment of CSFBC, be likely to prejudice
materially the success of the proposed issue, sale or distribution of the
Offered Securities, whether in the primary market or in respect of dealings in
the secondary market, or (ii) (A) any change, or any development or event
involving a prospective change, in the condition (financial or other), business,
properties or results of operations of the Company which, in the judgment of a
majority in interest of the Purchasers including CSFBC, is material and adverse
and makes it impractical or inadvisable to proceed with completion of the
offering or the sale of and payment for the Offered Securities; (B) any
downgrading in the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Securities Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company (other than an announcement
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with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (C) any suspension or limitation of
trading in securities generally on the New York Stock Exchange or any suspension
of trading of any securities of the Company on any exchange or over-the-counter
market; (D) any banking moratorium declared by U.S. Federal or New York
authorities; or (E) any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or any other
substantial national or international calamity or emergency if, in the judgment
of a majority in interest of the Purchasers including CSFBC, the effect of any
such outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the offering or sale of
and payment for the Offered Securities.
(d)(i) The Purchasers shall have received an opinion, dated
the Closing Date, of Xxxxxxx Xxxxx Xxxxxx & Xxxxx, L.L.P., counsel for the
Company, to the effect that:
(A) When the Offered Securities have been
authenticated by the Trustee in accordance with the Indenture and
delivered to and paid for by the Purchasers in accordance with the
terms of this Agreement, the Offered Securities and the Indenture will
have been duly executed and delivered and will constitute valid and
legally binding obligations of the Company, enforceable against it in
accordance with their terms, and the Offered Securities will conform in
all material respects to the description thereof in the Offering
Document and the Indenture.
(B) The Company is not, and after giving effect to
the offering and sale of the Offered Securities and the application of
the proceeds thereof as described in the Offering Document, will not
be, an "investment company" as defined in the Investment Company Act of
1940, as amended, and the rules and regulations promulgated by the
Commission thereunder.
(C) No consent, approval, authorization or order of,
or filing with, any governmental agency or body or any court, in each
case of the United States or the States of Texas or New York, is
required for the consummation of the transactions described in this
Agreement and the Registration Rights Agreement in connection with the
issuance or sale of the Offered Securities by the Company, or for the
execution, delivery and performance of the Indenture by the Company,
except such as may be required under state securities laws and except
for such filings with and orders of the Commission as are required in
connection with the Registration Rights Agreement.
(D) The execution, delivery and performance of the
Indenture, this Agreement and the Registration Rights Agreement and the
issuance and sale of the Offered Securities and compliance with the
terms and provisions thereof by the Company will not result in a breach
or violation of any of the terms and provisions of, or constitute a
default under, any statute, rule or regulation of any governmental
agency or body of the United
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States or the States of Texas or New York having jurisdiction over the
Company or any of its properties or to which any of the properties of
the Company is subject.
(E) The Company has full corporate power and
authority to authorize, issue and sell the Offered Securities as
described in this Agreement.
(F) The descriptions in the Offering Document of
statutes fairly present in all material respects the information
purported to be shown.
(G) It is not necessary in connection with (1) the
offer, sale and delivery of the Offered Securities by the Company to
the Purchasers pursuant to this Agreement or (2) the resales of the
Offered Securities by the Purchasers in the manner described in this
Agreement, to register the Offered Securities under the Securities Act
or to qualify the Indenture under the Trust Indenture Act.
Such opinion shall also state that such counsel has no reason to
believe that the Offering Document, as of its date or the date of such opinion,
contains an untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(ii) The Purchasers shall have received an opinion, dated the
Closing Date, of Xxxxxxxx X. Xxxx, Esq., General Counsel of the Company, to the
effect that:
(A) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own its properties and
conduct its business as described in the Offering Document; and the
Company is duly qualified to do business as a foreign corporation in
good standing in all states of the United States in which its ownership
or lease of property or the conduct of its business requires such
qualification.
(B) R&B Falcon Holdings, Inc. ("Falcon") has been
duly incorporated and is an existing corporation in good standing under
the laws of the State of Delaware, with corporate power and authority
to own its properties and conduct its business as described in the
Offering Document. Falcon is duly qualified to do business as a foreign
corporation in good standing in all states of the United States in
which its ownership or lease of property or the conduct of its business
requires such qualification, with the possible exception of the State
of Louisiana; provided, the failure to so qualify in Louisiana, if
required, would not have a Material Adverse Effect.
(C) R&B Falcon Drilling (International & Deepwater)
Inc. ("R&B") has been duly incorporated and is an existing corporation
in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its
business as described in the Offering Document. R&B is duly qualified
to do business as a
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foreign corporation in good standing in all states of the United States
in which its ownership or lease of property or the conduct of its
business requires such qualification.
(D) Cliffs has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own its properties and
conduct its business as described in the Offering Document. Cliffs is
duly qualified to do business as a foreign corporation in good standing
in all states of the United States in which its ownership or lease of
property or the conduct of its business requires such qualification.
(E) R&B Falcon Drilling USA, Inc. ("R&B USA") has
been duly incorporated and is an existing corporation in good standing
under the laws of the State of Delaware, with corporate power and
authority to own its properties and conduct its business as described
in the Offering Document. R&B USA is duly qualified to do business as a
foreign corporation in good standing in all states of the United States
in which its ownership or lease of property or the conduct of its
business requires such qualification.
(F) R&B Falcon Drilling Co. ("Drilling") has been
duly incorporated and is an existing corporation in good standing under
the laws of the State of Oklahoma, and is duly qualified to do business
as a foreign corporation in each state of the United States in which
its ownership or lease of property or the conduct of its business
requires such qualifications.
(G) All of the outstanding capital stock of the
Company, Falcon, R&B and Cliffs has been duly authorized and validly
issued and is fully paid and non-assessable. To such counsel's
knowledge, all of the outstanding stock of Falcon, R&B, Cliffs, R&B USA
and Drilling is owned directly or indirectly by the Company, free from
any liens and encumbrances (except for the stock of R&B which has been
pledged as security for the first $100 million of borrowings under the
Amended Bank Facility).
(H) The Indenture and the Offered Securities have
been duly authorized, executed and delivered by the Company.
(I) The Amended Bank Facility has been duly
authorized, executed and delivered by the Company and, upon delivery to
Paribas Corporation of the required portion of the net proceeds from
the sale of the Offered Securities pursuant to the Amended Bank
Facility, will constitute the valid and legally binding obligation of
the Company, enforceable against the Company in accordance with its
terms subject to applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(J) The execution, delivery and performance of the
Indenture, the Amended Bank Facility, this Agreement and the
Registration Rights Agreement and the
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issuance and sale of the Offered Securities and compliance with the
terms and provisions thereof will not result in a breach or violation
of any of the terms and provisions of, or constitute a default under
(i) to such counsel's knowledge, any order of any governmental agency
or body or any court having jurisdiction over the Company or any of its
properties, (ii) to such counsel's knowledge, any agreement or
instrument to which the Company is a party or by which the Company is
bound or to which any of the properties of the Company is subject, or
(iii) the charter, other organizational documents or by-laws of the
Company. The Company has full corporate power and authority to
authorize, issue and sell the Offered Securities as contemplated by the
Agreement.
(K) Except with respect to any potential claims or
causes of action arising out of the Company's contract with Mobil North
Sea Limited regarding the Xxxx Xxxxx, and except with respect to the
litigation pending in the 16th Judicial District Court, Parish of St.
Xxxx, State of Louisiana, styled Mobil Exploration & Producing U.S.,
Inc. et al v. Cliffs Drilling Company et al., to such counsel's
knowledge, there are no pending actions, suits or proceedings against
or affecting the Company, any of its Subsidiaries or any of their
respective properties that, if determined adversely to the Company or
any of its Subsidiaries, would individually or in the aggregate have a
Material Adverse Effect, or would materially and adversely affect the
ability of the Company to perform its obligations under the Indenture,
this Agreement, the Registration Rights Agreement or the Amended Bank
Facility or which are otherwise material in the context of the sale of
the Offered Securities; and, to such counsel's knowledge, no such
actions, suits or proceedings are threatened or contemplated.
(L) As of the date of the Offering Document and the
date hereof, such counsel has no reason to believe that the Offering
Document or any Exchange Act Report, or any Cliffs Exchange Act Report,
contained any untrue statement of material fact or omitted to state any
material fact necessary to make the statements therein not misleading.
The descriptions in the Offering Document of legal proceedings,
contracts, and other documents, insofar as they pertain to the Company,
are accurate and fairly present the information in all material
respects, it being understood that such counsel expresses no opinion as
to (i) the financial statements or other financial data contained in
the Offering Document and the Exchange Act Reports or (ii) the
information contained in the Offering Document under "Description of
the Notes."
(M) Each of this Agreement and the Registration
Rights Agreement has been duly authorized, executed and delivered by
the Company.
In addition, with respect to the opinion delivered by Xxxxxxxx X. Xxxx,
Esq., such opinion shall provide that Xxxxxxx & Xxxxx L.L.P. be entitled to rely
on the opinion delivered by Xxxxxxxx X. Xxxx, Esq. in connection with the
closing of the Amended Bank Facility. To the extent matters relating to the
Amended Bank Facility are covered in such opinion, they need not be separately
opined to in the opinion set forth above.
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(e) The Purchasers shall have received from Xxxxxxx & Xxxxx
L.L.P., counsel for the Purchasers, such opinion, dated the Closing Date, with
respect to the formation of the Company, the validity of the Offered Securities,
the Offering Document, the exemption from registration for the offer and sale of
the Offered Securities by the Company to the several Purchasers and the resales
by the several Purchasers as contemplated hereby and other related matters as
CSFBC may require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon such
matters.
(f) The Purchasers shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to the
best of their knowledge after reasonable investigation, shall state that the
representations and warranties of the Company in this Agreement are true and
correct, that the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to the
Closing Date, and that, subsequent to the date of the most recent financial
statements in the Offering Document there has been no material adverse change,
nor any development or event involving a prospective material adverse change, in
the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole, except as set
forth in or contemplated by the Offering Document or as described in such
certificate.
(g) The Purchasers shall have received a letter, dated the
Closing Date, of Xxxxxx Xxxxxxxx LLP which meets the requirements of subsection
(a) of this Section, except that the specified date referred to in such
subsection will be a date not more than three business days prior to the Closing
Date for the purposes of this subsection.
(h) The Purchasers shall have received a letter, dated the
Closing Date, of Ernst & Young LLP which meets the requirements of subsection
(b) of this Section, except that the specified date referred to in such
subsection will be a date not more than three business days prior to the Closing
Date for the purposes of this subsection.
(i) The Amended Bank Facility shall have been duly executed
and delivered by the parties thereto and shall be a valid and binding obligation
of the Company, enforceable in accordance with its terms.
(j) The Offered Securities shall have been made eligible for
trading in PORTAL.
The Company will furnish the Purchasers with such conformed copies of
such opinions, certificates, letters and documents as the Purchasers reasonably
request. CSFBC may in its sole discretion waive on behalf of the Purchasers
compliance with any conditions to the obligations of the Purchasers hereunder,
whether in respect of the Closing Date or otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Purchaser against any losses, claims, damages or liabilities,
joint or several, to which
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such Purchaser may become subject, under the Securities Act or the Exchange Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any breach of any of the
representations and warranties of the Company contained herein or any untrue
statement or alleged untrue statement of any material fact contained in the
Offering Document, or any amendment or supplement thereto, or any related
preliminary offering circular, the Exchange Act Reports or the Cliffs Exchange
Act Reports, or arise out of or are based upon the omission or alleged omission
to state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and will reimburse each Purchaser for any legal or other expenses
reasonably incurred by such Purchaser in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement in or omission
or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by any Purchaser
through CSFBC specifically for use therein, it being understood and agreed that
the only such information consists of the information described as such in
subsection (b) below.
(b) Each Purchaser will severally and not jointly indemnify
and hold harmless the Company against any losses, claims, damages or liabilities
to which the Company may become subject, under the Securities Act or the
Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Offering Document, or any amendment or supplement thereto, or any related
preliminary offering circular, or arise out of or are based upon the omission or
the alleged omission to state therein a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by such Purchaser through CSFBC specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being understood
and agreed that the only such information furnished by any Purchaser consists of
the following information in the Offering Document furnished on behalf of each
Purchaser: under the caption "Plan of Distribution," the third sentence of
paragraph two, the third sentence of paragraph six, and paragraphs seven and
eight; provided, however, the Purchasers shall not be liable for any losses,
claims, damages or liabilities arising out of or based upon the Company's
failure to perform its obligations under Section 5(a) of this Agreement.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under
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subsection (a) or (b) above. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party (which consent will not be
unreasonably withheld), effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified party unless
such settlement includes an unconditional release of such indemnified party from
all liability on any claims that are the subject matter of such action.
(d) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Purchasers on the other from the offering of
the Offered Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Purchasers on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Company bear to the total discounts and commissions received by the
Purchasers from the Company under this Agreement. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or the Purchasers
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The amount
paid by an indemnified party as a result of the losses, claims, damages or
liabilities referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (d). Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the total price at which the Offered
Securities purchased by it were resold exceeds the amount of any damages which
such Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. The Purchasers'
obligations in this subsection (d) to contribute are several in proportion to
their respective purchase obligations and not joint.
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(e) The obligations of the Company under this Section shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Purchaser within the meaning of the Securities Act or the Exchange Act; and
the obligations of the Purchasers under this Section shall be in addition to any
liability which the respective Purchasers may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act.
8. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
amount of Offered Securities that such defaulting Purchaser or Purchasers agreed
but failed to purchase does not exceed 10% of the total principal amount of
Offered Securities, CSFBC may make arrangements satisfactory to the Company for
the purchase of such Offered Securities by other persons, including any of the
Purchasers, but if no such arrangements are made by such Closing Date, the
non-defaulting Purchasers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Purchasers agreed but failed to purchase. If any Purchaser or
Purchasers so default and the aggregate principal amount of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
principal amount of Offered Securities and arrangements satisfactory to CSFBC
and the Company for the purchase of such Offered Securities by other persons are
not made within 36 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Purchaser or the Company,
except as provided in Section 9. As used in this Agreement, the term "Purchaser"
includes any person substituted for a Purchaser under this Section. Nothing
herein will relieve a defaulting Purchaser from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Purchasers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Purchaser and the Company or any of their respective officers or
directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the Purchasers
is not consummated, the Company shall remain responsible for the expenses to be
paid or reimbursed by it pursuant to Section 5 and the respective obligations of
the Company and the Purchasers pursuant to Section 7 shall remain in effect. If
the purchase of the Offered Securities by the Purchasers is not consummated for
any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause (C),
(D) or (E) of Section 6(c)(ii), the Company will reimburse the Purchasers for
all out-of-pocket expenses (including fees and disbursements of counsel)
reasonably incurred by them in connection with the offering of the Offered
Securities. If this Agreement is terminated as provided in the second and third
sentences of this Section 9 or the purchase of the Offered Securities is not
consummated, the Company's sole liability shall be as provided for in this
Section 9.
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10. Notices. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers c/o Credit Suisse First Boston Corporation, Xxxxxx Xxxxxxx
Xxxxxx, Xxx Xxxx, X.X. 10010-3629, Attention: Investment Banking
Department--Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at R&B Falcon Corporation,
000 Xxxxxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, Attention: Xxxxxxxx X. Xxxx,
Senior Vice President and Co-Counsel; provided, however, that any notice to a
Purchaser pursuant to Section 7 will be mailed, delivered or telegraphed and
confirmed to such Purchaser.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7 and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company as if such
holders were parties thereto.
12. Representation of Purchasers. You will act for the several
Purchasers in connection with this purchase, and any action under this Agreement
taken by you jointly or by CSFBC will be binding upon all the Purchasers.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without regard to
principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
* * * * *
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If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement among the Company and the several
Purchasers in accordance with its terms.
Very truly yours,
R&B FALCON CORPORATION
By /s/ XXXXXXXX XXXX
------------------------------
Name: Xxxxxxxx Xxxx
Title: V.P.
The foregoing Purchase Agreement is hereby
confirmed and accepted as of the date first
above written.
Acting on behalf of itself and as the
Representative of the several Purchasers
CREDIT SUISSE FIRST BOSTON CORPORATION
NATIONSBANC XXXXXXXXXX SECURITIES LLC
PARIBAS CORPORATION
By CREDIT SUISSE FIRST BOSTON CORPORATION
By /s/ XXXXXX X. XXXXXX
-------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Director
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SCHEDULE A
PRINCIPAL PRINCIPAL
AMOUNT OF AMOUNT OF
PURCHASER 5-YEAR NOTES 10-YEAR NOTES
------------------------------------------------- ------------ -------------
Credit Suisse First Boston Corporation........... $ 70,000,000 $210,000,000
NationsBanc Xxxxxxxxxx Securities LLC............ 15,000,000 45,000,000
Paribas Corporation.............................. 15,000,000 45,000,000
------------ ------------
Total.......................... $100,000,000 $300,000,000
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SCHEDULE B
SUBSIDIARIES OF R&B FALCON CORPORATION
NAME JURISDICTION OF FORMATION
---- -------------------------
R&B Falcon Drilling (International & Deepwater) Inc. Delaware
R&B Falcon Holdings Inc. Delaware
R&B Falcon Drilling Co. Oklahoma
Arcade Drilling A.S. Norway
R&B Falcon Drilling USA, Inc. Delaware
Cliffs Drilling Company Delaware
Cliffs Drilling Trinidad Offshore Limited Trinidad
Deep Sea Investors, L.L.C. Delaware
R&B Falcon Exploration Co. Oklahoma
R&B Falcon Offshore, Limited Oklahoma
R&B Falcon (A) Pty. Ltd. Australia
R&B Falcon Borneo Drilling Co., Ltd. Oklahoma
R&B Falcon (Caledonia) Limited United Kingdom
RBF Rig Corporation Oklahoma
RBF FPSO L.P. Cayman Islands, B.W.I.
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Deepwater Drilling II L.L.C. Delaware
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