EXHIBIT 4.5
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Secured Loan Agreement
(Amoco Contracts)
Dated as of December 21, 1999
among
Transocean Enterprise Inc.,
as the Borrower,
ABN AMRO Bank N.V.,
as the Agent and the Collateral Agent,
the Liquidity Providers
from time to time party hereto,
ABN AMRO Bank N.V.,
as the Enhancer,
and
Amsterdam Funding Corporation
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TABLE OF CONTENTS
Article I Definitions.................................................... 1
Article II Loans to Borrower and Repayments............................... 21
Section 2.1. The Refinancing Loan........................................... 21
Section 2.2. Selection of Interest Rate Types and Interest Periods.......... 23
Section 2.3. Maturity of Loans.............................................. 24
Section 2.4. Optional Prepayments........................................... 25
Section 2.5. Mandatory Prepayments.......................................... 26
Section 2.6. Applicable Interest Rates...................................... 31
Section 2.7. Default Rate................................................... 32
Section 2.8. Fees and Other Costs and Expenses.............................. 32
Section 2.9. Reduction in Commitments....................................... 32
Section 2.10. The Note....................................................... 33
Section 2.11. Extensions of Scheduled Termination Date....................... 33
Article III Sales to and from Amsterdam; Allocations....................... 34
Section 3.1. Required Purchases from Amsterdam.............................. 34
Section 3.2. Allocations and Distributions.................................. 37
Article IV Indemnification................................................ 38
Section 4.1. Legal Fees, Other Costs and Indemnification.................... 38
Section 4.2. Change of Law.................................................. 40
Section 4.3. Unavailability of Deposits or Inability to Ascertain LIBOR..... 41
Section 4.4. Increased Cost and Reduced Return.............................. 41
Section 4.5. Lending Offices................................................ 43
Section 4.6. Discretion of Lender as to Manner of Funding................... 43
Section 4.7. Withholding Taxes.............................................. 43
Article V Conditions Precedent........................................... 46
Section 5.1. Conditions to Closing.......................................... 46
Section 5.2. Conditions to Advance of Each Loan on Funding Date............. 48
Article VI Representations and Warranties................................. 49
Section 6.1. Representations and Warranties................................. 49
Article VII Covenants...................................................... 52
Section 7.1. Covenants of the Borrower...................................... 52
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Article VII Events of Default.............................................. 67
Section 8.1. Events of Default.............................................. 67
Section 8.2. Non-Bankruptcy Defaults........................................ 70
Section 8.3. Bankruptcy Defaults............................................ 71
Section 8.4. Notice of Default.............................................. 71
Article IX The Agents..................................................... 71
Section 9.1. Appointment and Authorization.................................. 71
Section 9.2. Delegation of Duties........................................... 71
Section 9.3. Exculpatory Provisions......................................... 71
Section 9.4. Reliance by Agent.............................................. 72
Section 9.5. Assumed Payments............................................... 72
Section 9.6. Notice of Defaults or Put Events............................... 72
Section 9.7. Non-Reliance on Agent and Other Lenders........................ 73
Section 9.8. Agent and Affiliates........................................... 73
Section 9.9. Indemnification................................................ 73
Section 9.10. Successor Agent................................................ 74
Article X Miscellaneous.................................................. 74
Section 10.1. Termination.................................................... 74
Section 10.2. Notices........................................................ 74
Section 10.3. Payments and Computations...................................... 75
Section 10.4. Setoff......................................................... 75
Section 10.5. Amendments, Waivers and Consents............................... 76
Section 10.6. Waivers........................................................ 76
Section 10.7. Successors and Assigns......................................... 77
Section 10.8. Participations and Assignments................................. 77
Section 10.9. Intended Tax Characterization.................................. 81
Section 10.10. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial 81
Section 10.11. Confidentiality................................................ 82
Section 10.12. Confidentiality of Agreement................................... 83
Section 10.13. Agreement Not to Petition...................................... 83
Section 10.14. Excess Funds................................................... 83
Section 10.15. No Recourse.................................................... 84
Section 10.16. Limitation of Liability........................................ 84
Section 10.17. Headings; Counterparts......................................... 84
Section 10.18. Cumulative Rights and Severability............................. 84
Section 10.19. Entire Agreement............................................... 85
Section 10.20. Change in Accounting Principles, Fiscal Year or Tax Laws....... 85
Section 10.21. Officer's Certificates......................................... 85
Section 10.22. Effect of Inclusion of Exceptions.............................. 85
Section 10.23. Non-Recourse Obligation........................................ 85
Section 10.24. Lease Securitization Facility.................................. 86
Section 10.25. Amoco Quiet Enjoyment; Transocean Replaced Parts............... 86
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SCHEDULES DESCRIPTION
Schedule I Committed Lenders and Commitments of Committed Lenders
Schedule II Amortized Value of Vessels
Schedule 2.3 Scheduled Principal Payments and Vessel Amortization Payments
Schedule 6.1(r) Environmental Matters
EXHIBITS DESCRIPTION
Exhibit A Form of Borrowing Request
Exhibit B Form of Notification of Assignment from Amsterdam to the
Liquidity Providers and the Enhancer
Exhibit C Form of Notification of Assignment from the Liquidity Providers
and the Enhancer to Amsterdam
Exhibit 2.10 Form of Note
Exhibit 5.1B Form of Letter of Acceptance
Exhibit 10.8 Assignment Agreement
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SECURED LOAN AGREEMENT
(AMOCO CONTRACTS)
Secured Loan Agreement (Amoco Contracts), dated as of December 21, 1999,
among Transocean Enterprise Inc., a Delaware corporation (the "Borrower"), the
liquidity providers party hereto (the "Liquidity Providers"), Amsterdam Funding
Corporation, a Delaware corporation ("Amsterdam"), ABN AMRO Bank N.V., as
provider of the Program LOC (the "Enhancer"), and ABN AMRO Bank N.V., as agent
for the Lenders (the "Agent") and continuing its role as collateral agent (the
"Collateral Agent") originally established pursuant to the Secured Credit
Agreement.
The parties hereto agree as follows:
Article I
DEFINITIONS
The following terms used herein have the meanings set forth, or referred
to, below:
"ABN AMRO" means ABN AMRO Bank N.V. in its individual capacity and not in
its capacity as the Agent.
"Affiliate" means, for any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person. For purposes of this definition, "control" means the power,
directly or indirectly, to either (i) vote ten percent (10%) or more of the
securities having ordinary voting power for the election of directors of a
Person or (ii) cause the direction of the management and policies of a Person.
"Agent" is defined in the first paragraph hereof.
"Agent's Account" means the Agent's account designated as such to the
Borrower and the Lenders by the Agent.
"Aggregate Commitment" means Two Hundred Thirty Nine Million Eight Hundred
Seventy Seven Thousand Fifty Six Dollars and 94/100 ($239,877,056.94), as such
amount may be reduced pursuant to Section 2.9.
"Aggregate Principal Amount" means, at any time, the sum of all Principal
Amounts then outstanding.
"Amoco" means Amoco Production Company, a Delaware corporation. Should
Amoco be succeeded by merger or consolidation, references in this Agreement and
the other Credit Documents to Amoco shall be deemed to be to the successor
corporation or other entity.
"Amoco Contracts" means the Amoco Drillship Contract and the Amoco Rig
Contract.
"Amoco Drillship Contract" means that certain Amoco Production Company
Offshore Drilling/Workover/Completion Contract with respect to the Drillship
dated December 10, 1999, as amended, restated or supplemented from time to time.
"Amoco Letter of Acceptance" means a letter from Amoco accepting the
Drillship or the Rig, as the case may be, pursuant to the terms of the Amoco
Drillship Contract or the Amoco Rig Contract, as the case may be, each such
letter to be substantially in the form of Exhibit 5.1.
"Amoco Rig Contract" means that certain Amoco Production Company Offshore
Drilling/Workover/Completion Contract with respect to the Rig dated as of
November 5, 1996, as amended by Letter Agreement dated December 6, 1996, each by
and between Amoco and Transocean, as assigned to the Borrower pursuant to that
certain Transocean Amirante Drilling Contract Assignment Agreement dated as of
January 10, 1997, as amended by Amendment No. 2 dated February 27, 1997,
Amendment No. 3 dated September 16, 1997 and Amendment No. 4 dated as of April
29, 1998, each by and between Amoco (or its permitted assignee) and the
Borrower, and as subsequently amended, restated or supplemented from time to
time.
"Amortization Date" is defined in Section 2.3.
"Amortized Value of Vessels" means, at any time, an amount equal to (x) the
sum of (i) the amount set forth on Schedule II hereof under the heading
"Amortized Value of Drillship" (or, if the Vessel Amortization Payments relating
to the Drillship have been prepaid in full under Section 2.5(a), all other
amounts owed under such Section 2.5(a) have been paid, and the corresponding
payments related to the Drillship have been prepaid in full and all other
amounts then owed have been paid, under the corresponding provision of the
Transocean Contracts Loan Agreement, $0) and (ii) the amount set forth on
Schedule II hereof under the heading "Amortized Value of Rig" (or, if the Vessel
Amortization Payments relating to the Rig have been prepaid in full under
Section 2.5(a) or (b), as applicable, and the corresponding payments related to
the Rig have been prepaid in full under the corresponding provision of the
Transocean Contracts Loan Agreement, $0) minus (y) the amount of any Casualty
Proceeds applied to the reduction of the Vessel Amortization Payments hereunder
or under the Transocean Contracts Loan Agreement.
"Amsterdam" is defined in the first paragraph hereof.
"Amsterdam Termination Date" means the earliest of (a) the Business Day
designated as the Amsterdam Termination Date by the Borrower with no less than
five (5) Business Days prior notice to the Agent, (b) the Business Day
designated as the Amsterdam Termination Date by Amsterdam at any time to the
Borrower and (c) the Liquidity Termination Date.
"Amsterdam Transfer" is defined in the definition of "Purchase Price."
"Assignment Agreement" is defined in Section 10.8.
"Assignments of Amoco Contracts" means the Collateral Assignment of Amoco
Drillship Contract and the Collateral Assignment of Amoco Rig Contract, each
dated as of January 17,
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1997, by and between the Borrower and the Collateral Agent, as amended, restated
or supplemented from time to time.
"Assignment of Bank Guarantees" means the Collateral Assignment of Bank
Guarantees dated as of January 17, 1997, by and between the Borrower and the
Collateral Agent, as amended, restated or supplemented from time to time.
"Assignments of O&M Contracts" means the Collateral Assignment of Drillship
Operating and Maintenance Contract and the Collateral Assignment of Rig
Operating and Maintenance Contract, each dated as of January 17, 1997, by and
between the Borrower and the Collateral Agent, as amended, restated or
supplemented from time to time.
"Assignments of Shipyard Construction Contracts" means the Collateral
Assignment of Drillship Shipyard Construction Contract and the Collateral
Assignment of Rig Shipyard Construction Contract, each dated as of January 17,
1997, by and between the Borrower and the Collateral Agent, as amended, restated
or supplemented from time to time.
"Assignments of Transocean Contracts" means the Collateral Assignment of
Transocean Drillship Contract and the Collateral Assignment of Transocean Rig
Contract, each dated as of January 17, 1997, by and between the Borrower and the
Collateral Agent, as amended, restated or supplemented from time to time.
"Bankruptcy Event" means, for any Person, that (a) such Person makes a
general assignment for the benefit of creditors or any proceeding is instituted
by or against such Person seeking to adjudicate it bankrupt or insolvent, or
seeking the liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or any substantial part of its property or (b) such
Person takes any corporate action to authorize any such action.
"Base Rate" means, for any period, the daily average during such period of
the greater of (a) the floating commercial Dollar loan rate per annum of ABN
AMRO (which rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer by ABN AMRO) announced from
time to time, changing as and when said rate changes and (b) the Federal Funds
Rate plus 0.50% per annum.
"Borrower" is defined in the first paragraph hereof.
"Borrower Account" means any account designated by the Borrower to the
Agent from time to time.
"Borrowing" means a Loan or Loans allocated to a single Interest Period
pursuant to Section 2.1(b) or 2.2(a) or (b). Each Loan of a Lender for a
specific Interest Period is, in the case of Amsterdam, a Borrowing or, in the
case of a Committed Lender, its portion of a Borrowing. A Borrowing is
"advanced" on the Funding Date when the applicable Lender(s) advance(s)
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funds comprising such Borrowing, is "continued" on the date a new Interest
Period commences for the same type of Borrowing, and is "converted" (in the case
of a Borrowing from the Committed Lenders) when such Borrowing is changed to a
different type of Borrowing for an Interest Period or otherwise. The "type" of a
Borrowing is its status as a (i) CP Borrowing, (ii) Eurodollar Borrowing or
(iii) Base Rate Borrowing depending whether interest accrues on the principal
amount thereof during its Interest Period based on a (i) CP Rate, (ii)
Eurodollar Rate, or (iii) Base Rate.
"Borrowing Amount" is defined in Section 2.1(b).
"Borrowing Base" means, at any time the same is to be determined, 81% of
the Amortized Value of the Vessels as then determined.
"Borrowing Limit" means, at any time, the amount set forth on Schedule 2.3
as the "Borrowing Limit" for the Funding Date, at all times before the first
Amortization Date, and thereafter for the then most recent Amortization Date.
"Business Day" means any day other than (a) a Saturday, Sunday or other day
on which banks in New York City, Chicago, Illinois or Houston, Texas are
authorized or required to close, (b) a holiday on the Federal Reserve calendar
and, (c) solely for matters relating to a Eurodollar Loan, a day on which
dealings in Dollars are not carried on in the London, England interbank market.
"Capitalized Lease Obligations" means, for any Person, the amount of such
Person's liabilities under all leases of real or personal property (or any
interest therein) which is required to be capitalized on the balance sheet of
such Person as determined in accordance with GAAP.
"Cash Equivalents" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof having maturities of not more than twelve (12) months
from the date of acquisition, (ii) time deposits and certificates of deposits
maturing within one year from the date of acquisition thereof or repurchase
agreements with financial institutions whose short-term unsecured debt rating is
A-1 or above as obtained from either S&P or Moody's, (iii) commercial paper or
Eurocommercial paper with a rating of at least A-1 by S&P or at least P-1 by
Moody's, with maturities of not more than twelve (12) months from the date of
acquisition, (iv) repurchase obligations entered into with any Lender, or any
other Person whose short-term senior unsecured debt rating from S&P is at least
A-1 or from Xxxxx'x is at least P-1, which are secured by a fully perfected
security interest in any obligation of the type described in (i) above and has
market value at the time such repurchase is entered into of not less than 100%
of the repurchase obligation of such Lender or such other Person thereunder, (v)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within twelve (12) months from the date of
acquisition thereof or providing for the resetting of the interest rate
applicable thereto not less often than annually and, at the time of acquisition,
having one of the two highest ratings obtainable from either S&P or Moody's, and
(vi) money market funds which have at least $1,000,000,000 in assets and which
invest primarily in securities of the types described in clauses (i) through (v)
above.
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"Cash Flow Reserve" is defined in Section 7.1(m).
"Casualty Event" means an event resulting in destruction or damage to
either of the Drillship or the Rig other than as a result of an Event of Loss.
"Casualty Proceeds" means all compensation, damages and other payments,
including, without limitation, any insurance proceeds from insurance required to
be provided hereunder and provided by Amoco pursuant to the Amoco Contracts,
Transocean pursuant to the Transocean Contracts or any other Person pursuant to
the Substitute Contracts, if any, received by the Borrower, the Agent, the
Collateral Agent or any of the Lenders, jointly or severally, from any
governmental authority or other Person with respect to or in connection with a
Casualty Event, net of all reasonable out-of-pocket costs and expenses incurred
by such recipient in connection therewith; provided, however, Casualty Proceeds
shall not include any "xxx and labor reimbursement" expenses received by the
Borrower or Transocean under any hull insurance policy required pursuant to
Section 7.1(f).
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means all property and assets of the Borrower in which the
Collateral Agent is granted a Lien for the benefit of the Lenders, the "Lenders"
under the Transocean Contracts Loan Agreement and the Swap Parties, under the
terms of a Security Document.
"Collateral Agent" means ABN AMRO acting in its capacity as collateral
agent for the Lenders, the "Lenders" under the Transocean Contracts Loan
Agreement and the Swap Parties, and any successor collateral agent appointed
hereunder pursuant to Section 9.10.
"Collateral Agreement" means the Collateral Agreement dated as of January
17, 1997, among the Borrower, the Collateral Agent, the Agent, the "Agent" under
the Transocean Contracts Loan Agreement and the Swap Parties, as amended,
restated or supplemented from time to time.
"Collateral Termination Date" means the first date when (i) no Loans or
Commitments remain outstanding hereunder and no other Obligation is due and
payable hereunder, (ii) no "Loans" or "Commitments" remain outstanding under the
Transocean Contracts Loan Agreement and no other Transocean Contracts Obligation
is due and payable under the Transocean Contracts Loan Agreement and (iii) the
Borrower has no obligation to make any further interest rate swap payments to
any Swap Party under any Interest Rate Protection Agreement entered into in
accordance with Section 7.1(j) and no other obligations of the Borrower are due
and payable under any such Interest Rate Protection Agreement.
"Combined Aggregate Principal Amount" means the sum of the Aggregate
Principal Amount and the Transocean Contracts Aggregate Principal Amount.
"Committed Lender" means any Liquidity Provider and the Enhancer.
"Committed Lenders" means, collectively, each Liquidity Provider and the
Enhancer.
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"Commitment" means, for each Committed Lender, the amount set forth on
Schedule I, as adjusted in accordance with Sections 2.9, 2.11(b) and 10.8.
"Consenting Lender" is defined in Section 2.11(b).
"Construction Loan" means the "Construction Loan" advanced under the
Secured Credit Agreement and payable on the "Conversion Date" defined therein.
The "B Portion" of the Construction Loan means the principal amount of the
Construction Loan eligible to be converted into the "Tranche B Term Loan" under
the Secured Credit Agreement.
"CP Dealer" means, at any time, each Person Amsterdam then engages as a
placement agent or commercial paper dealer.
"CP Loan" means a Loan outstanding from Amsterdam that has been advanced or
continued for an Interest Period.
"CP Rate" means, for any Interest Period for a CP Borrowing, a rate per
annum equal to (a) the weighted average of the rates per annum at which
commercial paper notes having a term equal to such Interest Period are sold on
the first day of such Interest Period by any CP Dealer selected by Amsterdam, as
agreed between each such CP Dealer and Amsterdam, plus (b) on or after the
occurrence, and during the continuance, of an Event of Default, 2% per annum.
If such rate is a discount rate, the CP Rate shall be the rate resulting from
Amsterdam's converting such discount rate to an interest-bearing equivalent rate
per annum. If Amsterdam determines that it is not able, or that it is
impractical, to issue commercial paper notes for any period of time, then the CP
Rate shall be the Base Rate for such period of time. The CP Rate shall include
all costs and expenses to Amsterdam of issuing the related commercial paper
notes, including all dealer commissions and note issuance costs in connection
therewith.
"Credit Documents" means this Agreement, the Fee Letter, the Pricing Letter
and the Security Documents.
"Credit Party" means the Borrower or Transocean.
"Debt Rating" means, for any Person, the credit rating provided by Moody's
or S&P, as applicable, to such Person's long-term, unsecured, non-third party
credit enhanced senior debt.
"Default" means any Event of Default or any event or condition that with
the lapse of time or giving of notice, or both, would constitute an Event of
Default.
"Direct Lender" means any Funding Liquidity Provider, Funding Replaceable
Committed Lender or Non-Consenting Lender that has an outstanding Loan or Loans
that have not been repaid with the proceeds of a Loan advanced by Amsterdam
pursuant to Section 2.1.
"Dollar" and "$" mean lawful currency of the United States of America.
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"Drillship" means the dynamically positioned dual activity drillship known
as the Discoverer Enterprise, which has been contracted to Amoco pursuant to the
Amoco Drillship Contract for the drilling of offshore xxxxx.
"Drillship Documents" is defined in Section 2.5(e).
"Drillship Shipyard Construction Contract" means the Contract for
Construction of a Dynamically Positioned Drilling Unit dated as of July 24,
1996, by and between Transocean and Astilleros Y Talleres del Noroeste, S.A., a
corporation organized under the laws of Spain, as assigned to the Borrower
pursuant to that certain Shipyard Contract Assignment Agreement between
Transocean and the Borrower dated as of January 17, 1997, and as amended,
restated or supplemented from time to time.
"Early Payment Fee" means, if (i) any Eurodollar Borrowing is not advanced
or continued (or created through a conversion from a Base Rate Borrowing) after
the Borrower so requests pursuant to Section 2.1(b) or 2.2(a), other than
because of a default by a Lender, or (ii) any CP Borrowing or Eurodollar
Borrowing, or portion thereof, is repaid (as opposed to purchased pursuant to
Section 3.1) or any Eurodollar Borrowing is purchased, in whole or in part, by
Amsterdam pursuant to Section 2.2(c) (unless the Borrower requests Amsterdam to
pay to the Committed Lenders all interest scheduled to become due on such
Borrowing during its current Interest Period), in each case before the last day
of its Interest Period (the amount so repaid or purchased being referred to as
the "Prepaid Amount"), the cost to the relevant Lender of such reduction in the
CP or Eurodollar Loan it holds (or was scheduled to hold, in the case of a
Eurodollar Borrowing not advanced, continued or created through conversion),
which (a) for a CP Borrowing means any compensation payable in prepaying the
related commercial paper (in respect of unamortized discount or unaccrued
interest, as the case may be) or, if such commercial paper is not prepaid, any
shortfall between the amount that will be available to Amsterdam on the maturity
date of the related commercial paper from reinvesting the Prepaid Amount in
Permitted Investments and the Face Amount of such commercial paper and (b) for a
Eurodollar Borrowing will be determined based on the difference between the
LIBOR applicable to such Borrowing and the LIBOR applicable for a period equal
to the remaining maturity of the Borrowing on the date (x) the Borrowing is not
advanced, continued or converted, in the case of clause (i) above, or (y) the
Prepaid Amount is received, in the case of clause (ii) above.
"Effective Date" means the date on which all conditions precedent set forth
in Section 5.1 have been satisfied.
"Enhancer" is defined in the first paragraph hereof and any of its
successors or assigns.
"Enhancer Commitment Percentage" means ten percent (10%).
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of non-
compliance or violation, investigations or proceedings relating to any
Environmental Law or any permit issued under any Environmental Law ("Claims"),
including, without limitation, (i) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
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other actions or damages pursuant to any applicable Environmental Law, and (ii)
any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
Hazardous Materials or arising from alleged injury or threat of injury to the
environment.
"Environmental Law" means any federal, state, local or foreign statute,
law, rule, regulation, ordinance, code, policy or rule of common law now or
hereafter in effect, including any judicial, administrative or arbitral order,
consent, decree or judgment, relating to the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Eurodollar Rate" means, for any Interest Period for a Eurodollar
Borrowing, the sum of (a) LIBOR for such Interest Period divided by 1 minus the
`Reserve Requirement" and (b) (i) for the Loans from a Liquidity Provider, the
rate specified in the Pricing Letter, or (ii) for any Loans from the Enhancer
(other than in its capacity as a Liquidity Provider), the rate specified in the
Fee Letter; where "Reserve Requirement" means, for any Interest Period for a
Eurodollar Borrowing, the daily average during such Interest Period of the
percentage in effect on each day of such Interest Period, if any, as prescribed
by the Board of Governors of the Federal Reserve System (or any successor
thereto) for determining the maximum reserve requirements (including, without
limitation, any supplemental, marginal and emergency reserves) applicable to
"eurocurrency liabilities" of member banks of the Federal Reserve System in New
York City with deposits exceeding $1,000,000,000 pursuant to Regulation D of the
Board of Governors of the Federal Reserve System or any other then applicable
regulation of the Board of Governors (or any successor thereto) which prescribes
reserve requirements applicable to "Eurocurrency Liabilities" as presently
defined in such Regulation D.
"Event of Default" is defined in Section 8.1.
"Event of Loss" means any of the following events: (a) an event that
results in an insurance settlement on the basis of an actual or constructive
total loss of either the Drillship or the Rig; (b) theft, illegal confiscation
or disappearance of either of the Drillship or the Rig for a period of time
sufficient to allow Amoco or any Person under a Substitute Contract, as
applicable, to terminate or cancel, or that results in a termination or
cancellation of, the Amoco Contract or a Substitute Contract, as applicable,
for such vessel; or (c) condemnation or other taking of title of either of the
Drillship or the Rig by a governmental authority or the requisition or taking of
use of either of the Drillship or the Rig by a governmental authority, in each
case for a period of time sufficient to allow Amoco or any Person under a
Substitute Contract, as applicable, to terminate or cancel, or that results in
the termination or cancellation of, the Amoco Contract or a Substitute Contract,
as applicable, for such vessel.
"Event of Loss Proceeds" means all compensation, damages and other
payments, including, without limitation, any insurance proceeds from insurance
required to be provided hereunder and provided by Amoco pursuant to the Amoco
Contracts, Transocean pursuant to the Transocean Contracts or any other Person
pursuant to the Substitute Contracts, if any, received by the Borrower,
Transocean, the Agent, the Collateral Agent or any of the Lenders, jointly or
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severally, from any governmental authority or other Person with respect to or in
connection with an Event of Loss, net of all reasonable out-of-pocket costs and
expenses incurred by such recipient in connection therewith; provided, however,
Event of Loss Proceeds shall not include any "xxx and labor" reimbursement
expense payments received by the Borrower or Transocean under any hull insurance
policy required pursuant to Section 7.1(f).
"Excess Cash Flow" means for any calendar month beginning the first full
calendar month after the Funding Date, all sums paid to the Borrower under the
Amoco Contracts, the Transocean Contracts or the Substitute Contracts during the
period from the date of the prior Excess Cash Flow calculation (or for the first
calculation thereof, from the Funding Date) to two (2) Business Days prior to
the Amortization Date falling during such calendar month in excess of the sum of
(i) (x) with respect to the Drillship during the term of the Amoco Drillship
Contract or any Substitute Drillship Contract, $181,000 per day for the number
of days in the period to which the payment relates, or (y) with respect to the
Drillship during the term of the Transocean Drillship Contract, the operating
dayrate contained therein (express or implicit) for the number of days in the
period to which the payment relates, plus (ii) with respect to the Rig during
the term of the Amoco Rig Contract or any Substitute Rig Contract, the operating
dayrate in the Amoco Rig Contract as of the Funding Date, and with respect to
the Rig during the term of the Transocean Rig Contract, the operating dayrate
contained therein (express or implicit), as applicable, in each case for the
number of days in the period to which the payment relates, and in the case of
all of the foregoing, without giving effect to any amendment thereto which
reduces the stated operating dayrate and excluding any portion of any such sum
paid to the Borrower that is, or is attributable to, (i) cost reimbursements
(including, without limitation, for capital expenditures), (ii) employee
performance bonuses, or other third party bonuses paid or payable to a third
party which is not an Affiliate of the Borrower or Transocean, (iii) any sums
paid to the Borrower pursuant to any increase in the stated operating dayrate
under the stated contract for the Drillship or the Rig as a result of cost
escalations or capital expenditures, as demonstrated to the reasonable
satisfaction of the Agent, (iv) stated operating dayrate income paid under any
Substitute Contract during any period of cancellation of the Amoco Contract for
the same vessel during which Amoco is required to pay cancellation fees, to the
extent over and above the stated operating dayrate under the Amoco Contract,
which is required to be paid to Amoco under the applicable Amoco Contract, and
(v) income paid to the Borrower during any period of assignment of an Amoco
Contract to the extent required to be paid to Amoco under the applicable Amoco
Contract. To the extent the Borrower or Transocean funds or replenishes the
Cash Flow Reserve or the Insurance Reserve pursuant to the provisions of Section
7.1(f)(iii) or Section 7.1(m), as applicable, the Borrower shall recoup the
amount so funded or replenished (to the extent not already recouped by the
Borrower out of any excess Casualty Proceeds released to the Borrower pursuant
to the terms of Section 2.5(d)) before calculating Excess Cash Flow, and the
Excess Cash Flow in contemporaneous and subsequent months shall be deemed
reduced (but not below zero) until the entire amount so funded or replenished is
so recouped.
"Face Amount" means the face amount of any Amsterdam commercial paper
issued on a discount basis or, if not issued on a discount basis, the principal
amount of such note and interest scheduled to accrue thereon to its stated
maturity.
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"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal, for each day during such period, to the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the immediately preceding Business Day)
by the Federal Reserve Bank of New York or, if such rate is not so published for
any day which is a Business Day, the average of the quotations for such
transactions received by ABN AMRO as of approximately 10:00 a.m. (Chicago time)
on such day from three federal funds brokers of recognized standing selected by
it.
"Fee Letter" means the letter agreement relating to this Agreement dated as
of the date hereof among the Borrower, the Agent, Amsterdam and the Enhancer.
"First Mortgages" means the First Naval Mortgage covering the Drillship
dated as of August 6, 1998 between Transocean Hull No. 275 S. de X.X. and the
Collateral Agent, as assumed by the Borrower and the First Naval Mortgage
covering the Rig dated as of January 17, 1997, between the Borrower and the
Collateral Agent, as each mortgage may be amended, restated or supplemented from
time to time.
"Fixed Operating Expenses" means the monthly Fixed Operating Expenses for
each of the Drillship and the Rig at the applicable time as defined in the
applicable O&M Contract.
"Force Majeure" with respect to the Drillship and the Rig, as applicable,
has the meaning ascribed to such term in the applicable Amoco Contract,
Transocean Contract or Substitute Contract.
"Free Cancellation Right" is defined in Section 2.3(b).
"Functional Requirements" means the specifications and requirements for the
design, construction and performance capabilities of the Drillship and the Rig
as set forth in the Amoco Drillship Contract and the Amoco Rig Contract,
respectively.
"Funding Date" means the Business Day selected by the Borrower pursuant to
Section 2.1(b) as the date for the Lenders to advance funds hereunder.
"Funding Liquidity Provider" means each Liquidity Provider which on the
Funding Date does not have a short-term debt rating of at least "A-1" by S&P and
"P-1" by Moody's.
"Funding Party" is defined in Section 4.4(b).
"Funding Replaceable Committed Lender" is defined in Section 10.8(c).
"GAAP" means generally accepted accounting principles from time to time in
effect as set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
the statements and pronouncements of the Financial Accounting Standards Board or
in such other statements, opinions and
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pronouncements by such other entity as may be approved by a significant segment
of the U.S. accounting profession.
"Governmental Authority" means any (a) Federal, state, municipal or other
governmental entity, board, bureau, agency or instrumentality, (b)
administrative or regulatory authority (including any central bank or similar
authority) or (c) court, judicial authority or arbitrator, in each case, whether
foreign or domestic.
"Guaranty" by any Person means all contractual obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business) of such Person guaranteeing any Indebtedness, dividend or other
obligation (including, without limitation, obligations in connection with sales
of any property) of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, all obligations
incurred through an agreement, contingent or otherwise, by such Person: (i) to
purchase such Indebtedness or obligation, or to purchase any property or assets
constituting security therefor, primarily for the purpose of assuring the owner
of such Indebtedness or obligation of the ability of the primary obligor to make
payment of such Indebtedness or obligation; or (ii) to advance or supply funds
(x) for the purchase or payment of such Indebtedness or obligation, or (y) to
maintain working capital or other balance sheet condition, or otherwise to
advance or make available funds for the purchase or payment of such Indebtedness
or obligation, in each case primarily for the purpose of assuring the owner of
such Indebtedness or obligation of the ability of the primary obligor to make
payment of such Indebtedness or obligation; or (iii) to lease property, or to
purchase securities or other property or services, of the primary obligor,
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the primary obligor to make payment of such
Indebtedness or obligation; or (iv) otherwise to assure the owner of such
Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purpose of all computations made under this Agreement, the
amount of a Guaranty in respect of any obligation shall be deemed to be equal to
the amount that would apply if such obligation were the direct obligation of
such Person rather than the primary obligor or, if less, the maximum aggregate
potential liability of such Person under the terms of such Guaranty.
"Hazardous Material" has the meaning assigned to that term in the
Comprehensive Environmental Response Compensation and Liability Act of 1980, as
amended by the Superfund Amendments and Reauthorization Acts of 1986, and shall
also include Hydrocarbons or any other substance defined as "hazardous" or
"toxic" or words with similar meaning and effect under any Environmental Law
applicable to the Borrower.
"Hydrocarbons" means oil, gas and other liquid or gaseous hydrocarbons.
"Indebtedness" means, for any Person, the following obligations of such
Person, without duplication: (i) obligations of such Person for borrowed money;
(ii) obligations of such Person representing the deferred purchase price of
property or services other than accounts payable arising in the ordinary course
of business and other than amounts which are being contested in good faith and
for which reserves in conformity with GAAP have been provided; (iii) obligations
of such Person evidenced by bonds, notes, bankers acceptances, debentures or
other similar
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instruments of such Person or arising, whether absolute or contingent, out of
letters of credit issued for such Person's account or pursuant to such Person's
application; (iv) obligations of other Persons, whether or not assumed, secured
by Liens (other than Permitted Liens) upon property or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, but only to the extent of such property's fair market value; (v)
Capitalized Lease Obligations of such Person; (vi) obligations under (x)
Interest Rate Protection Agreements, (y) commodity hedge, swap, exchange,
forward, future, collar or cap arrangements, fixed price commodity agreements
and all other agreements or arrangements, in each case designed primarily to
protect against fluctuations in commodity prices, and (z) futures agreements,
arrangements or options designed primarily to protect against fluctuations in
currency exchange rates; and (vii) obligations of such Person pursuant to a
Guaranty of any of the foregoing of another Person. For purposes of this
Agreement, the Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture to the extent such Indebtedness is recourse to such
Person.
"Instructing Group" means the Enhancer and Liquidity Providers having
Commitments that together with the Enhancer's Commitment constitute a majority
of the Commitments and, unless the Amsterdam Termination Date has occurred and
Amsterdam has no outstanding Borrowings, Amsterdam.
"Insurance Reserve" is defined in Section 7.1(f).
"Insurance Reserve Required Amount" is defined in Section 7.1(f).
"Intended Tax Characterization" is defined in Section 10.9.
"Interest Period" means the period commencing on the date a Borrowing is
advanced pursuant to Section 2.1 or continued or converted pursuant to Section
2.2 and ending: (a) in the case of Base Rate Borrowings, the last Business Day
of the calendar quarter in which such Base Rate Borrowing is advanced pursuant
to Section 2.1 or continued or converted pursuant to Section 2.2; (b) in the
case of Eurodollar Borrowings, on the next Amortization Date; and (c) in the
case of CP Borrowings, 1-45 days thereafter, as requested by the Borrower, if
acceptable to Amsterdam, or as established by the Agent; provided, however,
that:
(a) any Interest Period for a Base Rate Borrowing that would
otherwise end after the last Amortization Date shall end on such
Amortization Date;
(b) an Interest Period for a CP Borrowing that would extend beyond
an Amortization Date may not be selected if, as a result, the aggregate
principal amount of CP and Eurodollar Borrowings scheduled to be
outstanding with Interest Periods ending after such Amortization Date would
exceed the principal amount of Loans scheduled to be outstanding after such
Amortization Date;
(c) whenever the last day of any Interest Period would otherwise be
a day that is not a Business Day, the last day of such Interest Period
shall be extended to the next succeeding Business Day, but, if such
extension would cause the last day of an Interest
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Period for a Eurodollar Borrowing to occur in the following calendar month,
the last day of such Interest Period shall be the immediately preceding
Business Day; and
(d) for purposes of determining an Interest Period for a Eurodollar
Borrowing, a month means a period starting on one day in a calendar month
and ending on the numerically corresponding day in the next calendar month;
provided, however, that if there is no numerically corresponding day in the
month in which such an Interest Period is to end or, if such an Interest
Period begins on the last Business Day of a calendar month, then such
Interest Period shall end on the last Business Day of the calendar month in
which such Interest Period is to end.
"Interest Rate Protection Agreement" means any interest rate swap, interest
rate cap, interest rate collar, or other interest rate hedging agreement or
arrangement designed to protect against fluctuations in interest rates.
"Lenders" means the Liquidity Providers and the Enhancer (whether in their
capacities as such or as Committed Lenders) and Amsterdam.
"Lending Office" means the branch, office or affiliate of a Committed
Lender specified on the appropriate signature page hereof, or designated
pursuant to Section 4.5 or 10.8, as the office through which it will make its
Loans hereunder for each type of Loan available from it hereunder.
"LIBOR" means, for any Interest Period for a Eurodollar Borrowing or any
other period, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of a percentage point) for deposits in Dollars for
a period equal to such Interest Period or other period, which appears on Page
3750 of the Telerate Service (or any successor page or successor service that
displays the British Bankers' Association Interest Settlement Rates for Dollar
deposits) as of 11:00 a.m. (London, England time) two Business Days before the
commencement of such Interest Period or other period for a period approximately
equal to such Interest Period or other period and in an amount equal or
comparable to the aggregate principal amount of the Eurodollar Loans to which
such Interest Period relates. If the foregoing Telerate rate is unavailable for
any reason, then such rate shall be determined by the Agent from the Reuters
Screen LIBOR page, or if such rate is also unavailable on such service, on any
other interest rate reporting service of recognized standing selected by the
Agent after consultation with the Borrower.
"License Agreement" means the License Agreement dated as of January 17,
1997 by and between Transocean and the Borrower, as amended, restated or
supplemented from time to time.
"Lien" means any interest in any property or asset in favor of a Person
other than the owner of such property or asset and securing an obligation owed
to, or a claim by, such Person, whether such interest is based on the common
law, statute or contract, including, but not limited to, the security interest
lien arising from a mortgage, encumbrance, pledge, conditional sale, security
agreement or trust receipt, or a lease, consignment or bailment for security
purposes.
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"Liquidity Providers" is defined in the first paragraph hereof together
with those Persons that become Liquidity Providers pursuant to Section 10.8.
"Liquidity Termination Date" means the earliest of (a) the date of the
occurrence of an Event of Default described in clause (g) or (h) of the
definition of Event of Default, (b) the date designated by the Agent to the
Borrower at any time after the occurrence of, and during the continuation of,
any other Event of Default, (c) the Business Day designated by the Borrower with
no less than five (5) Business Days prior notice to the Agent and (d) the
Scheduled Termination Date. The Liquidity Termination Date establishes the last
day on which the Liquidity Providers are obligated to acquire Loans from
Amsterdam. The maturity of Loans is established pursuant to Sections 2.3, 2.4,
2.5 (in the case of mandatory prepayments), and Article VIII (in the case of an
accelerated maturity).
"Loan" means any funds advanced to the Borrower pursuant to Section 2.1(a).
Although all Loans are advanced on the Funding Date, and the aggregate principal
amount of Loans outstanding never thereafter increases, the Loans held by a
Lender at any time are comprised of (a) before the end of its initial Interest
Period, each Loan it advances to the Borrower on the Funding Date as part (or
all) of a single Borrowing, and (b) after such initial Interest Period, each
Loan it continues, establishes through conversion from a different type of
Borrowing, or purchases from another Lender pursuant to Section 2.2(c) or 3.1,
in each case as part (or all) of a single Borrowing (but disregarding under both
(a) and (b) any portion of any such Loan transferred to another Lender pursuant
to Section 2.2(c) or 3.1). Each Loan from a Committed Lender is a Eurodollar
Loan or Base Rate Loan depending whether it is part of a Eurodollar Borrowing or
Base Rate Borrowing.
"Material Adverse Effect" means an effect that results in a material
adverse (i) change, since the Effective Date (in each case except to the extent
resulting from transactions expressly permitted under any Credit Document), in
(x) the business, properties, assets or financial condition of the Borrower or
the prospects of the Borrower during the scheduled term of the Loans, (y) so
long as the Transocean Performance Guaranty is in force and effect, the
business, properties, assets or financial condition of Transocean and its
Subsidiaries taken as a whole, or (z) the ability of the Borrower or the
Borrower and Transocean taken as a whole to perform their Obligations under the
Operative Documents to which they are a party, or (ii) change in the rights and
remedies of the Lenders or the Agent under the Credit Documents (other than in
accordance with the express terms thereof).
"Matured Aggregate Loan Amount" means, at any time, the Matured Value of
Amsterdam's outstanding Loans plus the aggregate principal amount of all Loans
then outstanding from the other Lenders.
"Matured Value" means, of any Loan (or portion thereof), the sum of the
principal amount of such Loan (or portion thereof) plus all interest scheduled
to become due (whether or not then due) on such Loan (or portion thereof) during
its current Interest Period and then unpaid.
"Monthly Report" is defined in Section 7.1(g).
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"Moody's" means Xxxxx'x Investors Service, Inc.
"Non-Consenting Lender" is defined in Section 2.11(a).
"Note" is defined in Section 2.10.
"Obligations" means all obligations of the Borrower and Transocean to pay
fees, costs and expenses, principal or interest on Loans and to pay any other
obligations to the Agent or any Lender arising under any Credit Document.
"O&M Contracts" means the Drillship Operation and Maintenance Contract and
the Rig Operation and Maintenance Contract, each dated as of January 17, 1997,
by and between Transocean and the Borrower, as amended, restated or supplemented
from time to time.
"Operative Documents" means the Amoco Contracts, the Transocean Contracts,
the Substitute Contracts, the O&M Contracts, the License Agreement and the
Credit Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Permitted Distribution Sources" is defined in Section 7.1(k).
"Permitted Indebtedness" is defined in Section 7.1(o).
"Permitted Investments" means (a) evidences of indebtedness, maturing
within thirty (30) days after the date of purchase thereof, issued by, or the
full and timely payment of which is guaranteed by the full faith and credit of,
the federal government of the USA, (b) repurchase agreements with banking
institutions or broker-dealers registered under the Securities Exchange Act of
1934 which are fully secured by obligations of the kind specified in clause (a),
(c) money market funds (i) rated not lower than the highest rating category from
both Moody's and S&P or (ii) which are otherwise acceptable to the Rating
Agencies or (d) commercial paper issued by any corporation incorporated under
the laws of the USA and rated at least "A-1" (or the equivalent) by S&P and at
least "P-1" (or the equivalent) by Moody's.
"Permitted Liens" is defined in Section 7.1(n).
"Person" means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or any agency or political subdivision
thereof.
"Plan" means an employee pension benefit plan covered by Title IV of ERISA
or subject to the minimum funding standards under Section 412 of the Code that
is either (i) maintained by the Borrower, or (ii) maintained pursuant to a
collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which the Borrower is then making or
accruing an obligation to make contributions or has within the preceding five
(5) plan years made or had an obligation to make contributions.
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"Pricing Letter" means the letter agreement dated as of the date hereof
among the Liquidity Providers, the Agent and the Borrower.
"Principal Amount" means, for any Lender at any time, the aggregate unpaid
principal amount of all Loans then held by such Lender, whether made directly by
such Lender or acquired from another Lender.
"Program LOC" means the irrevocable transferable letter of credit No.
S550115, dated November 3, 1995, issued by the Enhancer at the request of
Amsterdam, and each letter of credit issued in substitution or replacement
therefor.
"Program Unreimbursed Draw Amount" means the sum of all draws under the
Program LOC in connection with this Agreement which have not been reimbursed
(whether through the payment of cash or the exchange of assets), together with
all interest thereon and all other amounts, if any, payable in connection
therewith.
"Purchase Price" means, for each Committed Lender (other than a Direct
Lender) for any Put (any such Put being an "Amsterdam Transfer"), such Lender's
Purchased Percentage for such Amsterdam Transfer multiplied by the sum of (a)
(i) for the Enhancer, the principal amount of Loans from Amsterdam being
transferred pursuant to such Amsterdam Transfer (the "Transferred Principal")
and (ii) for each Liquidity Provider (other than a Direct Lender), the lesser of
(A) the Transferred Principal and (B) the product of (1) the Transferred
Principal divided by the aggregate principal amount of all Loans outstanding
from Amsterdam (before giving effect to such Amsterdam Transfer), (2)
Amsterdam's Share of Outstanding Loans at such time (before giving effect to
such Amsterdam Transfer), and (3) the Borrowing Base as then determined and
computed, plus (b) (i) all unpaid interest owed to Amsterdam (whether or not
then due) on the Transferred Principal to the end of the current Interest Period
for each Loan (or portion thereof) included in such Transferred Principal, (ii)
all accrued but unpaid fees (whether or not then due) payable to Amsterdam in
connection herewith at the time of such purchase and (iii) all accrued and
unpaid costs, expenses and indemnities due to Amsterdam from the Borrower in
connection herewith. Amsterdam shall calculate the Purchase Price on the date
of such Amsterdam Transfer based on the information then available to it, and,
regardless of whether such information is complete, such calculation shall be
conclusive and binding absent manifest error; provided, however, that if such
purchase occurs due to the occurrence of a Put Event, the Borrowing Base shall
be determined as of the date immediately preceding the occurrence of such Put
Event, adjusted to reflect amounts received by Amsterdam. In making any such
calculation, Amsterdam shall be entitled to rely on information provided to it
by the Borrower without any obligation to investigate the accuracy or
completeness of such information.
"Purchased Percentage" means, for any Amsterdam Transfer, for each
Committed Lender (other than a Direct Lender), its Ratable Share (calculated
without giving effect to the Commitments of the Direct Lenders) or such lesser
percentage as is necessary to prevent the Purchase Price of such Lender from
exceeding its Unused Commitment (unless, in the case of the Enhancer, it elects
not to reduce its Purchased Percentage in whole or in part).
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"Put" is defined in Section 3.l(a).
"Put Event" means: (i) the occurrence of any Event of Default, (ii) the
Combined Aggregate Principal Amount 80.5% or more of the Amortized Value of
Vessels as then determined, or (iii) the long term, senior, unsecured, non-
credit enhanced indebtedness of BP Amoco PLC, a corporation organized under the
laws of England, ceases to be rated at least BBB- from S&P and at least Baa3
from Moody's (or S&P or Moody's withdraws or suspends either such rating).
Should BP Amoco PLC be succeeded by a merger or consolidation, reference in this
Agreement and the other Operative Documents to BP Amoco PLC shall be deemed to
be to the successor corporation or other entity.
"Ratable Share" means, for each Committed Lender, such Lender's Commitment
divided by the Aggregate Commitment. If, however, on the date any Amsterdam
Transfer is to take place, the Enhancer has outstanding Principal Amount plus
Program Unreimbursed Draw Amount in excess of its Ratable Share of the
outstanding Principal Amount and Program Unreimbursed Draw Amount of all
Committed Lenders, then for purposes of such Amsterdam Transfer the Ratable
Share of each Committed Lender shall be replaced with a percentage equal for
each Committed Lender to (a) its Commitment minus the sum of (i) its Principal
Amount and (ii) Program Unreimbursed Draw Amount before such Amsterdam Transfer
(the sum of the amounts in clauses (a)(i) and (a)(ii) being its "Existing
Outstanding Principal Amount") divided by (b) the Aggregate Commitment minus the
sum of the Existing Outstanding Principal Amount of all Committed Lenders.
"Rating Agency" means Moody's, S&P and any other rating agency Amsterdam
chooses to rate its commercial paper notes.
"Ratings" means the ratings by the Rating Agencies of the indebtedness for
borrowed money of Amsterdam.
"Replaceable Committed Lender" is defined in Section 10.8(c).
"Replacement Committed Lender" is defined in Section 10.8(b).
"Required Coverage Payment" means, in connection with any mandatory
prepayment of Loans pursuant to Section 2.5, the excess, if any, of the Combined
Aggregate Principal Amount over the Borrowing Base.
"Required Liquidity Providers" means Liquidity Providers having Commitments
of at least 51% of the Commitments of all Liquidity Providers without including
the Commitment of any Defaulting Lender, either for voting purposes or for
calculating the Commitments of all Liquidity Providers, so long as such
Defaulting Lender has not satisfied any Unpaid Amount owed by it under Section
3.1(b).
"Rig" means the third-generation semisubmersible drilling rig known as the
Transocean Amirante which has been contracted to Amoco pursuant to the Amoco Rig
Contract for the drilling of offshore xxxxx for hydrocarbons.
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"Rig Documents" is defined in Section 2.5(e).
"Rig Shipyard Construction Contract" means the Master Service Contract for
the Rig by and between Transocean and Amfels, Inc., a Texas corporation, dated
as of June 7, 1996, as amended and assigned to the Borrower pursuant to the
Master Service Contract Amendment and Assignment Agreement dated as of January
10, 1997 by and among Transocean, Amfels, Inc. and the Borrower, together with
all work orders issued thereunder, as amended, restated or supplemented from
time to time.
"Scheduled Principal Payments" is defined in Section 2.3.
"Scheduled Termination Date" means December 19, 2000 or the later date, if
any, most recently established pursuant to Section 2.11.
"SEC" means the Securities and Exchange Commission.
"Secured Credit Agreement" means that certain Secured Credit Agreement
dated as of January 17, 1997 among the Borrower, the Lenders party thereto, and
the Agent and Co-Agents named therein, as amended by the First Amendment to
Secured Credit Agreement dated as of December 21, 1998, the Second Amendment to
Secured Credit Agreement dated as of August 13, 1999 and the Third Amendment to
Secured Credit Agreement dated as of October 22, 1999.
"Security Agreement" means the Security Agreement, dated as of January 17,
1997, by and between the Borrower and the Collateral Agent, as amended, restated
or supplemented from time to time.
"Security Documents" means the First Mortgages, the Security Agreement, the
Assignments of Shipyard Construction Contracts, the Assignments of Amoco
Contracts, the Assignments of Transocean Contracts, the Assignments of O&M
Contracts, any collateral assignment of any Substitute Contract, Section 2 of
the Collateral Agreement and all other security agreements, mortgages and like
agreements or instruments delivered by the Borrower or any other Person granting
a Lien on any of such Person's property to the Collateral Agent for the benefit
of the Lenders, the "Lenders" under the Transocean Contracts Loan Agreement and
the Swap Parties to secure (without limitation) the Obligations, as any of the
same may be amended, restated or supplemented from time to time.
"Senior Officer" means the president, any vice president, the chief
financial officer, the treasurer or the controller of the Borrower.
"Share of Outstanding Loans" means, at any time, for a Lender or group of
Lenders, a percentage equal to such Lender's then outstanding Principal Amount
or, as applicable, such group of Lenders' aggregate outstanding Principal
Amounts, divided, in each case, by the sum of (x) the Aggregate Principal Amount
and (y) the Transocean Contracts Aggregate Principal Amount then outstanding.
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"Special Transaction Subaccount" means the special transaction subaccount
established for this Agreement pursuant to Amsterdam's depositary agreement and
referred to in Section 3.1(d).
"S&P" means Standard & Poor's Ratings Group.
"Subsidiary" means, for any Person, any other Person of which more than
fifty percent (50%) of the outstanding stock or comparable equity interests
having ordinary voting power for the election of the board of directors of such
corporation, any managers of such limited liability company or similar governing
body (irrespective of whether or not at the time stock or other equity interests
of any other class or classes of such corporation or other entity shall have or
might have voting power by reason of the happening of any contingency), is at
the time directly or indirectly owned by such former Person or by one or more of
its Subsidiaries; provided, however, if the definition of "Subsidiary" shall be
amended (but not deleted) in the Transocean Credit Facility, the definition of
"Subsidiary" herein shall be deemed amended in the same respect.
"Substitute Contracts" means the Substitute Drillship Contract and the
Substitute Rig Contract.
"Substitute Drillship Contract" means any contract for the use of the
Drillship entered into by and between the Borrower and another Person
(including, without limitation, Amoco) in replacement of the Transocean
Drillship Contract as described in Section 7.1(r), provided that no such
contract shall be deemed to constitute a Substitute Drillship Contract unless
and until the Borrower terminates the Transocean Drillship Contract.
"Substitute Rig Contract" means any contract for the use of the Rig entered
into by and between the Borrower and another Person (including, without
limitation, Amoco) in replacement of the Transocean Rig Contract as described in
Section 7.1(r), provided that no such contract shall be deemed to constitute a
Substitute Rig Contract unless and until the Borrower terminates the Transocean
Rig Contract.
"Swap Obligations" means all obligations of the Borrower to pay fees, costs
and expenses, interest rate swap payments or other obligations to any Swap Party
under any Interest Rate Protection Agreement heretofore or hereafter entered
into by the Borrower.
"Swap Party" means each counterparty to an Interest Rate Protection
Agreement heretofore or hereafter entered into by the Borrower in accordance
with Section 6.10 of the Secured Credit Agreement and/or Section 7.1(j) that is
or was a Lender or an Affiliate of a Lender at the time such Interest Rate
Protection Agreement is or was entered into.
"Taxes" is defined in Section 6.1(k).
"Termination Date" means (a) for Amsterdam, the Amsterdam Termination Date,
(b) for the Liquidity Providers, the Liquidity Termination Date and (c) for the
Enhancer, the earlier of
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(i) the third (3rd) Business Day following the Liquidity Termination Date and
(ii) Scheduled Termination Date.
"Transfer" means a sale, transfer, conveyance, assignment or other
disposition (or a series of related dispositions), including, without
limitation, any transfer pursuant to an option to purchase, any sale or
assignment (with or without recourse) of any accounts receivable and any sale
and leaseback of assets, of an asset having a net book value as established in
accordance with GAAP in excess of $250,000, but excluding any involuntary
transfer by operation of law and any transfers of an asset pursuant to any
casualty or theft with respect to such asset.
"Transocean" means Transocean Offshore Inc., a Cayman Islands exempted
company, as successor by merger and conversion to Transocean Offshore Inc., a
Delaware corporation.
"Transocean Contracts" means the Transocean Drillship Contract and the
Transocean Rig Contract.
"Transocean Contracts Aggregate Principal Amount" means, at any time, the
aggregate unpaid principal amount of all "Loans" then outstanding under the
Transocean Contracts Loan Agreement.
"Transocean Contracts Loan Agreement" means the Secured Loan Agreement
relating to the Transocean Contracts dated as of even date herewith among the
Borrower, the Agent, and the lenders party thereto, as amended, restated or
supplemented from time to time, if executed. If such Secured Loan Agreement is
not executed all references herein to the Transocean Contracts Loan Agreement,
Transocean Contract Loans, Transocean Contracts Obligations and other related
definitions shall be deemed to be deleted.
"Transocean Contracts Loans" means the "Loans" to the Borrower outstanding
under and as defined in the Transocean Contracts Loan Agreement.
"Transocean Contracts Obligations" means the "Obligations" of the Borrower
under and as defined in the Transocean Contracts Loan Agreement.
"Transocean Credit Facility" means that certain Secured Credit Agreement
dated as of July 30, 1996, by and among Transocean, ABN AMRO, as Agent, and
certain lenders parties thereto, as amended, restated or supplemented from time
to time.
"Transocean Drillship Contract" means the Transocean Drillship Lease
Agreement dated as of January 17, 1997 by and between Transocean and the
Borrower, as amended, restated or supplemented from time to time.
"Transocean Performance Guaranty" means the Amended and Restated Transocean
Performance Guaranty dated as of December 21, 1998 issued by Transocean, as
amended, restated or supplemented from time to time.
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"Transocean Rig Contract" means the Transocean Rig Lease Agreement dated as
of January 17, 1997 by and between Transocean and the Borrower, as amended,
restated or supplemented from time to time.
"UCC" means, for any state, the Uniform Commercial Code as in effect in
such state.
"USA" means the United States of America (including all states and
political subdivisions thereof).
"Unfunded Vested Liabilities" means, for any Plan at any time, the amount
(if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, determined as of the then most recent valuation date
for such Plan, but only to the extent that such excess represents a potential
liability of the Borrower to the PBGC or such Plan.
"Unused Commitment" means, for any Committed Lender at any time, the
difference between its Commitment and its Loans then outstanding.
"Unused Aggregate Commitment" means, at any time, the difference between
the Aggregate Commitment then in effect and the outstanding Matured Aggregate
Loan Amount.
"Vessel Amortization Payments" is defined in Section 2.3.
"Vessel Financing Termination" is defined in Section 2.5(b).
"Vessel Percentage" shall have the meaning ascribed to such term in Section
7.1(f)(iii).
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms. Unless otherwise inconsistent with the
terms of this Agreement, all accounting terms used herein shall be interpreted,
and all accounting determinations hereunder shall be made, in accordance with
GAAP.
Article II
LOANS TO BORROWER AND REPAYMENTS
Section 2.1. The Refinancing Loan.
(a) Amsterdam Loan Option and Other Lenders' Commitments. Subject to the
terms and conditions hereof, Amsterdam may advance one or more Loans to the
Borrower on the Funding Date, and, if Amsterdam chooses not to so advance one or
more Loans to the Borrower on the Funding Date (subject to Section 5.2 and the
other terms and conditions hereof) each Liquidity Provider (other than the
Funding Liquidity Providers) and the Enhancer severally hereby agrees to,
advance one or more Loans to the Borrower on the Funding Date. Subject to the
terms and conditions hereof, each Funding Liquidity Provider severally agrees to
advance one or more Loans to the Borrower on the Funding Date. Each Borrowing
from Amsterdam shall be comprised of a Loan advanced or continued solely by
Amsterdam. Each Borrowing
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from the Committed Lenders (other than the Funding Liquidity Providers) shall be
advanced, continued or converted through a Loan from each Committed Lender
(other than the Funding Liquidity Providers) based on its Ratable Share of all
Borrowings required to be made on the Funding Date. Each Borrowing from the
Funding Liquidity Providers shall be advanced, continued or converted through a
Loan from each Funding Liquidity Provider based on its Ratable Share of all
Borrowings required to be made. After the Funding Date, Loans may only be
continued or converted pursuant to Section 2.2 or acquired pursuant to Sections
3.1 or 10.8(c), and no additional Loans shall be advanced. At any time the
short-term debt rating of a Funding Liquidity Provider is "A-1" or higher by S&P
and "P-1" or higher by Xxxxx'x, Amsterdam may advance a Loan to the Borrower in
an amount up to the aggregate principal amount of the outstanding Loans from
such Funding Liquidity Provider. The proceeds of such Loan shall be deposited
with such Funding Liquidity Provider to repay solely Loans then owed such
Funding Liquidity Provider without thereby reducing the aggregate principal
amount of outstanding Loans. No Lender shall be permitted or required to
advance, continue or convert a Loan if, after giving effect thereto, (i) the
Aggregate Principal Amount would thereby exceed the Borrowing Limit, (ii) the
Matured Aggregate Loan Amount would thereby exceed the Aggregate Commitment,
(iii) the product of (x) Lenders' Share of Outstanding Loans at such time and
(y) the Borrowing Base then in effect would be less than the Aggregate Principal
Amount, or (iv) in the case of an advance of a Loan by a Committed Lender, such
Committed Lender's Principal Amount (after giving effect to such advance) would
thereby exceed its Commitment. At no time will Amsterdam have any obligation to
advance or continue any Loan.
(b) Manner of Borrowing on Funding Date. The Borrower shall provide to
the Agent an irrevocable written request (including by telecopier or other
facsimile communication) substantially in the form of Exhibit A by 11:00 a.m.
(Chicago time) (i) three (3) Business Days before the requested Funding Date to
request a Eurodollar Borrowing and (ii) one (1) Business Day before the
requested Funding Date to request a Base Rate Borrowing or CP Borrowing. For
each requested Borrowing, the Borrower shall specify whether it is requested
from Amsterdam or from the Funding Liquidity Providers or from the other
Committed Lenders, the requested Funding Date and the requested amount (the
"Borrowing Amount") of such Borrowing, which must be in a minimum amount of
$1,000,000 and multiples thereof (provided that one Borrowing may be for an
amount equal to $1,000 or any amount in excess thereof), and a requested
Interest Period for such Borrowing (provided that in all events the Agent shall
be entitled to establish the Interest Period for a Borrowing from Amsterdam).
The Agent shall promptly notify the contents of such request to each Lender from
which the advance of a Borrowing is requested. If a Borrowing is requested from
Amsterdam on the Funding Date and Amsterdam determines, in its sole discretion,
to advance the requested Borrowing, Amsterdam shall transfer to the Agent's
Account the amount of such Borrowing on the requested Funding Date. If a
Borrowing is requested from the Funding Liquidity Providers on the Funding Date,
subject to Section 5.2 and the other terms and conditions hereof, each Funding
Liquidity Provider shall transfer its Ratable Share of the requested Borrowing
Amount into the Agent's Account by no later than 12:00 noon (Chicago time) on
the Funding Date. If a Borrowing is requested from any Committed Lender (other
than a Funding Liquidity Provider) on the Funding Date, subject to Section 5.2
and the other terms and conditions hereof, each such Committed Lender shall
transfer its Ratable Share of the requested Borrowing Amount into the Agent's
Account by no later than 12:00 noon (Chicago time) on the Funding Date. To the
extent Amsterdam does not deliver to the Agent's
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Account by 12:00 noon (Chicago time) on the Funding Date any portion of a
Borrowing Amount requested from it, the Agent shall promptly notify each
Committed Lender and the Borrower of such circumstance, and the Borrower shall
be deemed to have requested from the Committed Lenders (other than Funding
Liquidity Providers) a Base Rate Borrowing in the amount of such deficiency (the
"Unfunded Amount"), unless the Borrower notifies the Agent (including, at its
option, by telephone) that it does not require the proceeds of such Borrowing to
repay fully the B Portion of the Construction Loan. Subject to Section 5.2 and
the other terms and conditions hereof, each Committed Lender (other than Funding
Liquidity Providers) shall remit to the Agent's Account by no later than 2:00
p.m. (Chicago time) on the Funding Date its Ratable Share of any such Borrowing
of an Unfunded Amount. The Agent shall transfer to the Borrower Account the
proceeds of any Borrowing delivered into the Agent's Account. The Borrower
agrees to request Borrowings from the Funding Liquidity Providers in an
aggregate principal amount equal to the Funding Liquidity Provider's Ratable
Share of all the Loans advanced on the Funding Date.
Section 2.2. Selection of Interest Rate Types and Interest Periods.
(a) The Loan(s) included in each Borrowing advanced on the Funding Date shall
bear interest initially at the type of rate specified in the Borrower's notice
requesting such Borrowing pursuant to Section 2.1(b) or as otherwise established
by the third to last sentence of Section 2.1(b). Thereafter, the Borrower may
request Amsterdam to continue for an additional Interest Period part or all of
any CP Borrowing by giving the Agent notice of such requested continuation by no
later than 11:00 a.m. (Chicago time) one Business Day before the end of the
current Interest Period for such Borrowing. At any time that any Borrowings are
outstanding from the Committed Lenders, the Borrower may from time to time elect
to change or continue the type of interest rate borne by each such Borrowing or,
subject to the minimum amount of each Borrowing required by the first sentence
of Section 2.1(b) (or, for any Committed Lender that makes a Loan pursuant to
Section 10.8(c) or 2.11(b) in a principal amount less than such minimum amount,
the principal amount of such Loan), any portion thereof, as follows: (i) if
such Borrowing is a Eurodollar Borrowing, the Borrower may continue part or all
of such Borrowing as a Eurodollar Borrowing for an Interest Period specified by
the Borrower or convert part or all of such Borrowing into a Base Rate Borrowing
on the last day of the Interest Period applicable thereto, or the Borrower may
earlier convert part or all of such Borrowing into a Base Rate Borrowing so long
as it pays the Early Payment Fee provided in Section 2.8(b); and (ii) if such
Borrowing is a Base Rate Borrowing, on any Business Day the Borrower may convert
all or part of such Borrowing into a Eurodollar Borrowing. All such requests to
continue or convert part or all of a Borrowing from the Committed Lenders must
be delivered to the Agent by no later than 11:00 a.m. (Chicago time) three (3)
Business Days before the requested conversion or continuation through a written
notice (including by telecopier or other facsimile communication). All
Borrowings (i) from Amsterdam shall be CP Borrowings and (ii) from the Committed
Lenders may be Eurodollar or Base Rate Borrowings, in all cases for an Interest
Period. During the pendency of an Event of Default, the Borrower may not
request any Eurodollar Borrowings and all outstanding Eurodollar Borrowings
shall convert into Base Rate Borrowings on the last day of their Interest
Periods if any Event of Default is continuing at such time.
(b) If, by the time required in Section 2.2(a), the Borrower fails to
request an Interest Period for any Borrowing from Amsterdam or the requested
Interest Period is unacceptable to
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Amsterdam, the Agent may, in its sole discretion, select such Interest Period.
If, by the time required in Section 2.2(a), the Borrower fails to select the
type of Borrowing or Interest Period therefor from the Committed Lenders, such
Borrowing shall continue at the end of its then current Interest Period as a
Base Rate Borrowing. Any portion of a Borrowing from Amsterdam transferred to
Committed Lenders pursuant to Section 3.1 shall thereupon be deemed to have been
converted to a Base Rate Borrowing.
(c) In addition to transfers of Borrowings from Amsterdam to the Committed
Lenders, at any time a Borrowing is outstanding from the Committed Lenders, the
Borrower may request Amsterdam to purchase all, but not less than all, of the
outstanding Borrowing(s) then held by the Committed Lenders (other than Direct
Lenders). If Amsterdam, in its sole discretion, determines to acquire such
Borrowing(s) and is able to fund its acquisition of all or any part of such
Borrowing(s), Amsterdam may purchase such Borrowing(s), or the portion thereof
for which it is able to receive funding, at a purchase price equal to the
Matured Value of the Loans comprising each Borrowing (or portion thereof) so
purchased (or, so long as all Early Payment Fees payable to the Committed
Lenders in connection with such purchase are paid by the Borrower, the principal
amount of, and all accrued and unpaid interest on, such Borrowing or portion
thereof); provided that, if more than one Borrowing from the Committed Lenders
(other than Direct Lenders) is outstanding, Amsterdam may purchase each
Borrowing on the last day of the Interest Period applicable to such Borrowing.
Any such purchase of a Borrowing by Amsterdam from the Committed Lenders shall
be accomplished through a notification in the form of Exhibit B hereto and shall
be subject to the limitations in Section 2.1(a), and such sale shall be made by
each Committed Lender without recourse, representation or warranty except for
the representation and warranty by each applicable Committed Lender that each
Loan sold by such Committed Lender is free and clear of any Liens created or
granted by such Committed Lender and that such Committed Lender has not suffered
any Bankruptcy Event.
Section 2.3. Maturity of Loans. (a) The Borrower shall repay a
portion of the Borrowings on the last Business Day of each calendar month,
commencing on the last Business Day of the first full calendar month after the
Funding Date (except that the first payment date may be the last Business Day in
the calendar month in which the Loans are first advanced to the Borrower) (each
an "Amortization Date"), in the principal amounts set forth opposite each
Amortization Date on Schedule 2.3 under the heading "Scheduled Principal
Payments" (the "Scheduled Principal Payments") (or, if less, the aggregate
principal amount of Loans then outstanding). Each Scheduled Principal Payment
shall be allocated between a payment related to the Rig and a payment related to
the Drillship as set forth opposite each Amortization Date on Schedule 2.3 under
the heading "Vessel Amortization Payments" (the unpaid portion of such payments
at any date may be referred to as "Vessel Amortization Payments").
(b) The Agent shall, after consultation with the Borrower and Transocean,
reset the sizing of the Loans and the Transocean Contract Loans (keeping the
aggregate principal amount of the Loans and the Transocean Contract Loans
outstanding the same), the amortization payments for the Loans and the
Transocean Contract Loans, the rent payable under the Transocean Contracts, to
the extent any such contract remains effective pursuant to the terms hereof, and
the allocation of payments required on each Amortization Date between the Rig
and the Drillship (all in accordance with the Sizing Methodology defined in the
Secured Credit
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Agreement as last in effect before the repayment of the Construction Loans on or
before the Funding Date) within ten (10) Business Days from when (i) the
effective date with respect to a Substitute Contract shall have occurred, (ii)
the Borrower provides evidence reasonably satisfactory to the Agent that Amoco
is then required to pay under the terms and provisions of the applicable Amoco
Contract the stated operating dayrate contained therein as opposed to any
cancellation fee for the remaining term of such contract (or, if earlier, until
the last Amortization Date for the Loans), or (iii) if Amoco does not cancel a
portion of the term of the Amoco Rig Contract (pursuant to the right to do so
with no obligation to pay a cancellation fee (the "Free Cancellation Right"))
prior to the commencement of the fourth year, fifth year or last eighteen (18)
month period, respectively, of the term of the Amoco Rig Contract. The Borrower
shall provide written notice to the Agent of any event described in (iii) above,
and the Agent shall promptly provide any such notice to all Lenders. The Agent
shall, after consultation with the Borrower and Transocean, also reset downwards
the rent payable under the Transocean Contracts, to the extent any such contract
remains effective pursuant to the terms hereof, within ten (10) Business Days
from any prepayment of the Transocean Contract Loans pursuant to Section 2.4 or
2.5 of the Transocean Contracts Loan Agreement, all in accordance with the
Sizing Methodology defined in the Secured Credit Agreement as last in effect
before the repayment of the Construction Loans on or before the Funding Date.
Section 2.4. Optional Prepayments. Except pursuant to Section
2.5, the Borrower may not prepay any Borrowing unless all Transocean Contracts
Loans have been repaid in full. Subject to the immediately preceding sentence,
the Borrower shall have the privilege of prepaying (x) Base Rate Borrowings
without premium or penalty at any time in whole or at any time and from time to
time in part (but, if in part, then in an amount which is equal to or greater
than $1,000,000), so long as the Borrower shall have given notice of such
prepayment to the Agent (which shall in turn provide such notice promptly to the
Lenders) no later than 12:00 noon (Chicago time) on the date of such prepayment,
and (y) Eurodollar Borrowings or CP Borrowings without premium or penalty in
whole or in part (but, if in part, then in an amount which is equal to or
greater than $5,000,000) (i) only on the last Business Day of an Interest Period
for such a Borrowing, and (ii) at any other time so long as any Early Payment
Fee then due pursuant to Section 2.8(b) are paid; provided, however, that the
Borrower shall have given notice of such prepayment to the Agent (which shall in
turn provide such notice promptly to the Lenders) no later than 11:00 a.m.
(Chicago time) (I) with respect to Base Rate Borrowings, on the date of such
prepayment or (II) with respect to Eurodollar Borrowings or CP Borrowings, at
least three (3) Business Days before the proposed prepayment date. Each such
optional prepayment shall be accompanied by a payment of all accrued and unpaid
interest on the Loans prepaid and any Early Payment Fee then due pursuant to
Section 2.8(b). Optional prepayments under this Section 2.4 shall be applied to
the remaining Scheduled Principal Payments in the inverse order of maturity.
Each payment applied to a Scheduled Principal Payment shall be applied ratably
between the Vessel Amortization Payments comprising such Scheduled Principal
Payment. Amounts prepaid on the Loans under Section 2.4 or 2.5 may not be
reborrowed.
Section 2.5. Mandatory Prepayments.
(a) Event of Loss. Within three (3) days of receipt by the
Borrower, Transocean, the Agent, the Collateral Agent or any of the Lenders
of any casualty
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insurance proceeds or any condemnation or other similar proceeds from any
governmental authority or other Person from any Event of Loss (the
"Insurance Receipt Date"), the Borrower may, upon written notice to the
Agent (who shall promptly provide such notice to the Lenders), elect to
reconstruct the Drillship or the Rig, as applicable, with the Event of Loss
Proceeds so long as (i) such reconstruction can be completed within
eighteen (18) months from the date of such Event of Loss, as reasonably
determined by the Borrower at such time and as demonstrated to the
reasonable satisfaction of the Agent, (ii) such Event of Loss has not
caused and is not reasonably likely to cause either of the Amoco Contracts
or any Substitute Contract to terminate or cancel (with no obligation to
pay a cancellation fee and other than pursuant to the Free Cancellation
Right) and Amoco or such substitute contracting party, as applicable,
provides written confirmation to the Agent that it will continue to lease
the applicable vessel at the end of such reconstruction period pursuant and
subject to the terms of such applicable contract for the full stated term
thereof, (iii) the Collateral Agent (for the benefit of the Lenders, the
"Lenders" under the Transocean Contracts Loan Agreement and the Swap
Parties) is provided a security interest in any construction contract and
any letter of credit or other collateral provided to the Borrower or
Transocean in connection therewith on terms substantially similar to the
applicable Security Documents and otherwise as reasonably satisfactory to
the Agent, (iv) Transocean executes and delivers a new performance guaranty
of the reconstruction thereof containing terms substantially similar to the
applicable portions of the Transocean Performance Guaranty and otherwise as
reasonably satisfactory to the Agent, (v) the Borrower shall be able to
obtain loss of hire insurance for such vessel after the reconstruction
period therefor as then reasonably determined by the Borrower and as
demonstrated to the reasonable satisfaction of the Agent, and (vi) the
Borrower shall demonstrate to the reasonable satisfaction of the Agent that
it shall be able to timely pay its Obligations hereunder and any "true up"
costs and expenses payable to any Swap Parties as a result of such Event of
Loss and such reasonably determined reconstruction period under the
Interest Rate Protection Agreements as required pursuant to Section 7.1(j)
and no Default shall have occurred and be continuing, in which event all
Event of Loss Proceeds shall be segregated and held by the Collateral Agent
and made available by the Collateral Agent to the Borrower (x) for such
reconstruction, using contractors, plans and specifications and methods
substantially in accordance with the Functional Requirements as reasonably
satisfactory to the Agent and the Instructing Group, and (y) for the
payment of the Obligations, the Transocean Contracts Obligations and the
Swap Obligations, as provided below. If the Borrower elects not to, or is
unable pursuant to the terms and conditions hereof to, reconstruct the
applicable vessel with any such Event of Loss Proceeds, the Borrower shall
within three (3) days of the Insurance Receipt Date, make a mandatory
principal prepayment of (i) the remaining unpaid Vessel Amortization
Payments for the Drillship or the Rig, as applicable, (ii) the remaining
unpaid "Vessel Amortization Payments" under the Transocean Contracts Loan
Agreement for the Drillship or the Rig, as applicable, and (iii) after
giving effect to the preceding clause (ii), (x) any unpaid Transocean
Contracts Aggregate Principal Amount in the amount of any Required Coverage
Payment (or, if less, the remaining unpaid Transocean Contracts Aggregate
Principal Amount) and (y) if such outstanding Transocean Contracts
Aggregate Principal Amount is less than the Required Coverage Payment,
Loans outstanding hereunder in the amount of such
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difference. Prepayments made under clause (iii) of the preceding sentence
shall be applied to the "Scheduled Principal Payments" under the Transocean
Contracts Loan Agreement, or to the Scheduled Principal Payments, as the
case may be, in the inverse order of maturity. Each such mandatory payment
shall be accompanied by a payment of all accrued and unpaid interest on the
Loans and the Transocean Aggregate Principal Amount prepaid and any Early
Payment Fee pursuant to Section 2.8(b) and the comparable provisions of the
Transocean Contracts Loan Agreement. Any Event of Loss Proceeds received at
any time by the Borrower, Transocean, the Agent, the Collateral Agent or
any of the Lenders shall (i) if received by any such Person other than the
Collateral Agent, forthwith be turned over to the Collateral Agent or (ii)
if received by the Collateral Agent (or turned over to the Collateral Agent
pursuant to clause (i)), be applied as directed by the Borrower from time
to time to the payment of Obligations, Transocean Contract Obligations, or
Swap Obligations (including, without limitation, to mandatory payments of
the amounts provided in clauses (i)-(iii) of the second preceding sentence
or to the payment of costs incurred in connection with the reconstruction
of the Drillship or the Rig, as applicable, if undertaken in accordance
with this Section 2.5(a)). Any Event of Loss Proceeds held by the
Collateral Agent (i) after such reconstruction is completed, as evidenced
by a certificate from the Borrower certifying the completion of such
reconstruction or repair in form and substance reasonably satisfactory to
the Agent, or (ii) after the mandatory prepayment of amounts owed hereunder
and under the Transocean Contracts Loan Agreement, as described above,
shall be released by the Collateral Agent to the Borrower upon demand.
(b) Vessel Financing Termination. The Borrower may for any reason
at any time elect to terminate the financing arrangements provided in this
Agreement and the Transocean Contracts Loan Agreement for the Rig (a
"Vessel Financing Termination"). The Borrower shall give the Agent at
least three (3) Business Days' notice of the date on which it intends to
effect a Vessel Financing Termination. The Agent shall promptly provide
any such notice to the Lenders. On the date so specified, the Borrower
shall make a prepayment of amounts owing hereunder and under the Transocean
Contracts Loan Agreement as it would be required under clauses (i)-(iii) of
the second sentence in Section 2.5(a) if the Rig were subject to an Event
of Loss and were not reconstructed.
(c) Excess Cash Flow. On each Amortization Date, if there are no
outstanding Transocean Contracts Obligations, the Borrower shall make a
mandatory prepayment of the outstanding Loans in an amount equal to 50% of
Excess Cash Flow received during the preceding calendar month, for
application to the Scheduled Principal Payments in the inverse order of
maturity, applied ratably between the Vessel Amortization Payments due on
each such date based on their principal amounts.
(d) Casualty Event. The Borrower shall use any Casualty Proceeds
aggregating less than $15,000,000 from any Casualty Event to repair the
Drillship or the Rig, as applicable, so long as no Default shall have
occurred and be continuing, provided that the Collateral Agent shall hold
any such Casualty Proceeds so long as a Default shall have occurred and
then be continuing and (i) shall release such Casualty Proceeds to the
Borrower to be used for such repair when and if such Default shall have
been cured or
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waived pursuant to the terms hereof or (ii) if so directed by the Borrower,
shall apply such Casualty Proceeds against the Obligations, Transocean
Contract Obligations and/or Swap Obligations as set forth below in this
Section 2.5(d). The Borrower shall use any Casualty Proceeds aggregating
$15,000,000 or more to repair the Drillship or the Rig, as applicable,
using such contractors, plans and specifications and methods substantially
in accordance with the Functional Requirements as reasonably determined by
the Borrower so long as (i) such repair can be completed within eighteen
(18) months from the date of such Casualty Event as reasonably determined
by the Borrower at such time, (ii) such Casualty Event shall have not
caused, and is not reasonably likely to cause, either of the Amoco
Contracts or the Substitute Contracts, if any, to terminate or cancel (with
no obligation to pay a cancellation fee and other than pursuant to the Free
Cancellation Right), (iii) Transocean executes and delivers a new
performance guaranty of the repair thereof containing terms substantially
similar to the applicable portions of the Transocean Performance Guaranty
and otherwise as reasonably satisfactory to the Agent, provided that the
damages for failure to perform such guaranty shall be limited to the amount
of the aggregate Casualty Proceeds received by the Borrower or Transocean
from such Casualty Event and such guaranty of repair shall be deemed
satisfied when Amoco or any other Person party to a Substitute Contract, as
applicable, shall have commenced making scheduled stated operating dayrate
payments with respect to the applicable vessel after such repairs have been
completed, and (iv) the Borrower shall demonstrate to the reasonable
satisfaction of the Agent that it shall be able to timely pay its
Obligations hereunder during the anticipated repair period as reasonably
determined by the Borrower, and any "true up" costs and expenses payable to
any Swap Parties as a result of such Casualty Event and such repair period
under the Interest Rate Protection Agreement as required pursuant to
Section 7.1(j) and no Default shall have occurred and be continuing. If the
Borrower elects not to (for any Casualty Event whose Casualty Proceeds
aggregate more than $15,000,000), or is unable pursuant to the terms and
conditions hereof to, repair the applicable vessel with any such Casualty
Proceeds, the Borrower shall within three (3) days of receipt by the
Borrower, Transocean, the Agent, the Collateral Agent or any of the Lenders
of any casualty insurance proceeds or any condemnation or other similar
proceeds from any governmental authority or any other Person, make a
mandatory principal prepayment of the Loans and/or Transocean Contracts
Loans, as determined below, in an aggregate amount such that the sum of the
aggregate principal payment, plus the other amounts that will become
payable as a result of such mandatory prepayment as set forth in the
following two sentences and the corresponding provisions of the Transocean
Contracts Loan Agreement, equals the Casualty Proceeds. Each such mandatory
prepayment shall be accompanied by a payment of all accrued and unpaid
interest on the Loans and Transocean Contracts Loans prepaid and any Early
Payment Fee then due pursuant to Section 2.8(b) or the comparable provision
of the Transocean Contracts Loan Agreement. So long as the Amoco Contract
or the Substitute Contract, as applicable, for the vessel subject to such
Casualty Event remains in effect, each such prepayment shall be applied to
the Transocean Contracts Loans in inverse order of maturity and, only after
their payment in full, to the Loans in inverse order of maturity (and, with
respect to such particular remaining Scheduled Principal Payment to which
such prepayment is so allocated, shall be further suballocated between the
two Vessel Amortization Payments comprising each such Scheduled Principal
Payment, ratably
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according to the amount of each such Vessel Amortization Payment). If the
Amoco Contract or the Substitute Contract, as applicable, for such vessel
subject to the Casualty Event does not remain in effect, such prepayment
shall be applied ratably to the Vessel Amortization Payments for the
applicable vessel and the "Vessel Amortization Payments" under the
Transocean Contracts Loan Agreement for the applicable vessel, ratably
based on their aggregate amounts, in inverse order of their maturities. Any
Casualty Proceeds received at any time by the Borrower, Transocean, the
Agent, the Collateral Agent or any of the Lenders shall (i) if received by
any such Person other than the Collateral Agent, forthwith be turned over
to the Collateral Agent, or (ii) if received by the Collateral Agent (or
turned over to the Collateral Agent pursuant to clause (i)), be applied as
directed by the Borrower from time to time to the payment of amounts
payable hereunder and/or under the Transocean Contracts Loan Agreement
(including, without limitation, to the mandatory prepayment provided for in
this Section 2.5(d), if any) and/or Swap Obligations, or to the payment of
costs incurred in connection with the repair of the Drillship or the Rig,
as applicable, if undertaken in accordance with this Section 2.5(d)). Any
Casualty Proceeds held by the Collateral Agent after any such repair is
completed, as evidenced by a certificate from the Borrower certifying the
completion of such repair in form and substance reasonably satisfactory to
the Agent, shall be released by the Collateral Agent to the Borrower upon
demand.
(e) Adjustments to Operative Documents. Any term of this Agreement
or any other Security Document to the contrary notwithstanding, upon the
making of payments pursuant to Section 2.5(a) or (b), (i) the Collateral
Agent shall execute and deliver to the Agent such instruments as are
necessary to release the applicable vessel and any Collateral related
thereto from any Lien thereon under any Security Document, and the Borrower
and the Collateral Agent shall enter into such instruments as are necessary
to terminate the applicability of the Credit Documents to the applicable
vessel and any such related Collateral, (ii) without limitation of clause
(i), if the Drillship is the applicable vessel, references herein to the
Drillship or to the Amoco Drillship Contract, the Transocean Drillship
Contract, the Substitute Drillship Contract, the Drillship O&M Contract,
the Drillship Shipyard Construction Contract, the Assignment of Bank
Guarantees and any other Credit Documents relating solely to the Drillship
(collectively, the "Drillship Documents"), other than references to any of
the foregoing in Section 2.5(a) or (b), as applicable, and other than
specific references to the Drillship as the applicable vessel pursuant to
Section 2.5(a) or (b), as applicable, and except to the extent otherwise
expressly provided in provisions making specific reference to this Section
2.5(e), shall be deemed to be deleted, references in the Credit Documents
that are not Drillship Documents to the Drillship or any of the Drillship
Documents, other than specific references therein to the Drillship as the
applicable vessel pursuant to Section 2.5(a) or (b), as applicable, and
except to the extent otherwise expressly provided in provisions making
specific reference to this Section 2.5(e), shall be deemed to be deleted,
the Credit Documents that are Drillship Documents shall be terminated and
the Borrower shall be free to act in its sole discretion with respect to
the Drillship (and related assets) and the Drillship Documents that are not
Credit Documents, (iii) without limitation of clause (i), if the Rig is the
applicable vessel, references herein to the Rig or to the Amoco Rig
Contract, the Transocean Rig Contract, the Substitute Rig Contract, the
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Rig O&M Contract, the Rig Shipyard Construction Contract and any other
Credit Documents relating solely to the Rig (collectively, the "Rig
Documents"), other than references to any of the foregoing in Section
2.5(a) or (b), as applicable, and other than specific references to the Rig
as the applicable vessel pursuant to Section 2.5(a) or (b), as applicable,
and except to the extent otherwise expressly provided in provisions making
specific reference to this Section 2.5(e), shall be deemed to be deleted,
references in the Credit Documents that are not Rig Documents to the Rig or
any of the Rig Documents, other than specific references therein to the Rig
as the applicable vessel pursuant to Section 2.5(a) or (b), as applicable,
and except to the extent otherwise expressly provided in provisions making
specific reference to this Section 2.5(e), shall be deemed to be deleted,
the Credit Documents that are Rig Documents shall be terminated and the
Borrower shall be free to act in its sole discretion with respect to the
Rig (and related assets) and the Rig Documents that are not Credit
Documents, and (iv) any amount in the Insurance Reserve with respect to
such vessel as determined pursuant to Section 7.1(f)(iii) shall be released
by the Collateral Agent to the Borrower. Notwithstanding anything to the
contrary contained in this Section 2.5(e), the applicable vessel and any
related Collateral shall not be released from any Lien thereon under any
Security Documents unless and until the Borrower shall have effected a
"true-up" of the financial terms of the Interest Rate Protection Agreement
or Agreements in effect at such time to the extent necessary to eliminate
any over-hedged position at such time as a result of any such prepayments
or, if no Default or Event of Default shall have occurred and be continuing
under the Transocean Credit Facility, the Borrower shall have assigned its
rights and obligations under such Interest Rate Protection Agreement or
Agreements to Transocean to the extent of such prepayment pursuant to
documentation in form and substance reasonably satisfactory to the affected
Swap Party.
(f) "Xxx and Labor" Reimbursement Insurance Proceeds. The
Collateral Agent shall promptly turn over to Transocean any "xxx and labor"
reimbursement expense payments received by it so long as (or when) no
Default shall have occurred and be continuing (or, if so directed by
Transocean, apply such payments against the Obligations, the Transocean
Contract Obligations and/or Swap Obligations).
(g) Early Payment Fee. If any payments made under this Section 2.5
would result in the reduction of any CP or Eurodollar Borrowing before the
last day of its Interest Period, in order to avoid the need to pay an Early
Payment Fee under Section 2.8(b), so long as no Event of Default then
exists, the Borrower may direct the Agent to invest the funds required to
be applied to make such payment in Permitted Investments, through an
investment account in the Agent's name and sole control, and apply the
proceeds of such investments to repay CP or Eurodollar Borrowings on the
last day of the Interest Period applicable thereto. Interest shall
continue to accrue on such CP or Eurodollar Borrowings until payments are
applied to reduce such Borrowings.
(h) Drillship Dayrate Differential. If the stated operating dayrate
(excluding any incentive or bonus rates) to be paid by Amoco pursuant to
the terms of the Amoco Drillship Contract is less than $181,000 per day as
a result of one or more agreements of the parties thereto to an incentive
program, then the Borrower shall give prompt written
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notice thereof to the Agent (which the Agent will in turn forward promptly
to the Lenders) and the Agent shall on or prior to the date ten (10) days
after any such agreement becomes effective so as to reduce the operating
day rate thereunder, after consultation with the Borrower and Transocean,
reasonably determine the reduced size of the Loans and the principal amount
of each required payment of each Loan on each remaining Amortization Date,
in each case using the Sizing Methodology defined in the Secured Credit
Agreement as last in effect before the repayment of the Construction Loans
on or before the Funding Date. The remaining required amortization payments
for the Loans shall be such that the Loans (after taking into account the
Fixed Operating Expenses attributable to each of the Rig and the Drillship)
are fully amortized to $0 by the last Amortization Date on Schedule 2.3.
The Borrower will, on or prior to the date fifteen (15) days after any such
agreement becomes effective so as to reduce the operating dayrate
thereunder, prepay the principal amount of the Loans in an amount equal to
the difference between the outstanding principal balance of the Loans and
such reduced size of the Loans appropriately using the Sizing Methodology.
Such mandatory prepayment shall be accompanied by a payment of all accrued
and unpaid interest on the principal amount of Loans so prepaid and any
applicable breakage fees and funding losses pursuant to Section 2.8(b).
Section 2.6. Applicable Interest Rates. (a) Base Rate Borrowings.
Each Base Rate Borrowing shall bear interest (computed on the basis of a
365/366-day year and actual days elapsed excluding the date of repayment) on the
unpaid principal amount thereof from the date such Borrowing is advanced,
continued or created through conversion until the last day of its Interest
Period, conversion to a Eurodollar Borrowing or maturity (whether by
acceleration or otherwise), at a rate per annum equal to the Base Rate from time
to time in effect, payable on such last day of its Interest Period, date of
conversion or at maturity (whether by acceleration or otherwise).
(b) Eurodollar Borrowings. Each Eurodollar Borrowing shall bear interest
(computed on the basis of a 360-day year and actual days elapsed, excluding the
date of repayment) on the unpaid principal amount thereof from the date such
Borrowing is advanced, continued or created through conversion until the last
day of its Interest Period, conversion to a Base Rate Borrowing or maturity
(whether by acceleration or otherwise), at a rate per annum equal to the
Eurodollar Rate applicable to such Borrowing, payable on such last day of its
Interest Period, conversion to a Base Rate Borrowing or at maturity (whether by
acceleration or otherwise).
(c) CP Borrowings. Each CP Borrowing shall bear interest (computed on the
basis of a 360-day year and actual days elapsed, excluding the date of
repayment) on the unpaid principal amount thereof from the date such Borrowing
is advanced or continued until the last day of its Interest Period (whether by
acceleration or otherwise) at a rate per annum equal to the CP Rate for such
Borrowing, payable on the last day of its Interest Period and when required by
Section 3.1(c).
(d) Rate Determinations. The Agent shall determine each interest rate
applicable to each Borrowing and such determination shall be conclusive and
binding except in the case of the Agent's manifest error or willful misconduct.
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Section 2.7. Default Rate. If any payment of principal on any
Borrowing from the Committed Lenders is not made when due after the expiration
of the grace period therefor provided in Section 8.1(a) (whether by acceleration
or otherwise), such Borrowing shall bear interest (computed on the basis of a
year of 360, 365 or 366 days, as applicable for the relevant type of rate, and
actual days elapsed) after such grace period expires until such principal then
due is paid in full, payable on demand, at a rate per annum equal to:
(i) for any Base Rate Borrowing, the sum of two percent (2%) per
annum plus the Base Rate from time to time in effect (but not less than the
Base Rate in effect at maturity); and
(ii) for any Eurodollar Borrowing, the sum of two percent (2%) per
annum plus the rate of interest in effect thereon at the time of such
default until the end of the Interest Period for such Borrowing and,
thereafter, at a rate per annum equal to the sum of two percent (2%) per
annum plus the Base Rate from time to time in effect (but not less than the
Base Rate in effect at maturity).
Section 2.8. Fees and Other Costs and Expenses. (a) The Borrower
shall pay to the Agent (i) for the ratable benefit of the Liquidity Providers,
such amounts as agreed to with the Liquidity Providers and the Agent in the
Pricing Letter, and (ii) for the account of the Enhancer and the Agent, such
amounts as agreed to with the Enhancer and the Agent in the Fee Letter.
(b) If (x) any portion of a CP Borrowing or Eurodollar Borrowing is repaid
(as opposed to purchased) or, in the case of a Eurodollar Borrowing, purchased
by Amsterdam pursuant to Section 2.2(c) (unless the Borrower requests Amsterdam
to pay to the Committed Lenders all interest scheduled to become due on such
Borrowing during its current Interest Period), in each case, before the last day
of its Interest Period or (y) a Eurodollar Borrowing is not advanced or
continued, or created by conversion, as requested by the Borrower pursuant to
Section 2.1(b) or 2.2(a), the Borrower shall pay the Early Payment Fee to each
Lender that had its Loan so repaid or purchased or not so advanced, continued,
or created by conversion (other than as a result of such Lender's default).
Section 2.9. Reduction in Commitments. The Borrower may, upon
thirty days' notice to the Agent (which shall promptly notify each Lender),
reduce the Borrowing Limit and/or Aggregate Commitment in increments of
$1,000,000, so long as the Aggregate Commitment at all times equals at least the
Matured Aggregate Loan Amount and at least 102% of the Borrowing Limit then in
effect. At the time any Scheduled Principal Payment or mandatory prepayment is
received by the Agent in full, or any optional prepayment is received, the
Borrowing Limit shall automatically reduce by the amount of such payment (if not
already reduced by such amount on Schedule 2.3) and the Aggregate Commitment
shall automatically reduce to an amount equal to 102% of the Borrowing Limit
then in effect or, if larger, the Matured Aggregate Loan Amount then in effect.
Each reduction in the Aggregate Commitment shall reduce the Commitment of each
Committed Lender in accordance with its Ratable Share.
Section 2.10. The Note. The Loans outstanding to the Borrower
from the Lenders shall be evidenced by a single promissory note of the Borrower
payable to the order of the Agent, for the
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benefit of the Lenders, in the form of Exhibit 2.10 (the "Note"). The Agent
shall record on its books and records or on a schedule to the Note the amount of
each Loan held by a Lender, all payments of principal and interest and the
principal balance from time to time owed to each Lender, the type of each Loan
and the Interest Period and interest rate applicable thereto. Such record,
whether shown on the books and records of the Agent or on a schedule to the
Note, shall be prima facie evidence as to all such matters; provided, however,
that the failure of the Agent to record any of the foregoing or any error in any
such record shall not limit or otherwise affect the obligation of the Borrower
to repay all Loans outstanding to it hereunder together with accrued interest
thereon.
Section 2.11. Extensions of Scheduled Termination Date.
(a) Not more than 90 days before the Scheduled Termination Date then in
effect, the Borrower may request that each Committed Lender (other than a Direct
Lender that previously was a Non-Consenting Lender) extend its Commitment for an
additional 364 days. Each such Committed Lender shall respond to such request
within 30 days of receiving such request or, if later, on the date 45 days
before the then Scheduled Termination Date. If, by the date 45 days before the
then Scheduled Termination Date, any such Committed Lender (a "Non-Consenting
Lender") has not notified the Agent it agrees to so extend its Commitment for an
additional 364 day period, unless (in the case of a Liquidity Provider) any
other Liquidity Provider or Providers (including any Person who thereby becomes
a Liquidity Provider) assumes the Commitment of such Non-Consenting Lender,
including any Loans made by a Direct Lender, in accordance with Section 10.8(b)
on or before the date 30 days before the then Scheduled Termination Date and
agrees to extend such Commitment for an additional 364 day period, the Scheduled
Termination Date shall not be extended, unless the Scheduled Termination Date is
extended pursuant to Section 2.11(b). If all such Committed Lenders agree to
extend the Scheduled Termination Date, or if the Commitment of each Non-
Consenting Lender that is a Liquidity Provider is assumed by another Lender
pursuant to the preceding sentence, the Scheduled Termination Date shall be
extended for an additional 364 day period. Otherwise, subject to Section
2.11(b), the Scheduled Termination Date shall take place as scheduled.
(b) If the Enhancer and Liquidity Providers having Commitments that
together with the Enhancer's Commitment constitute a majority of the Commitments
have agreed (each such Lender being a "Consenting Lender"), pursuant to Section
2.11(a), to extend their Commitments (including the assumption of Commitments
pursuant to Section 2.11(a)) for an additional 364 day period, but one or more
Non-Consenting Lenders have not had their Commitment(s), including any Loan made
by a Direct Lender, assumed as contemplated by Section 2.11(a), the Borrower may
by notice to the Agent either (i) reduce the Aggregate Commitment by an amount
up to the amount of the Unused Commitment(s) of the Liquidity Provider(s) that
were Non-Consenting Lender(s) either by requiring each such Non-Consenting
Lender to advance one or more Loans and/or by terminating all or any portion of
each such Non-Consenting Lender's Commitment, if such reduction in the Aggregate
Commitment is permitted under Section 2.9 (without giving effect to the minimum
amount or required increment for such reductions, neither of which shall apply
in such instance) or (ii) repay on the then Scheduled Termination Date all or a
portion of the Loans advanced by any Committed Lenders that were Non-Consenting
Lenders, with each such payment to be allocated pro rata solely to the Non-
Consenting Lenders that are
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Committed Lenders. Such reduction in the Aggregate Commitments shall thereupon
become effective with the reduction allocated pro rata solely to the Non-
Consenting Lender(s) with its or their Unused Commitment(s) reduced by an amount
designated by the Borrower and any repayment of Loans shall be allocated pro
rata solely to the Non-Consenting Lenders in accordance with the aggregate
principal amount of all outstanding Loans owed to the Non-Consenting Lenders.
Any previously advanced Loans then outstanding from such Non-Consenting
Lender(s) shall remain outstanding subject to the terms of this Agreement. If
Loans are then outstanding from Amsterdam, then the Borrower may elect to (i)
extend the Scheduled Termination Date for each Consenting Lender by delivering a
notice to the Agent of such election and (ii) require each Non-Consenting Lender
(that is not a Direct Lender) to advance on or before the then Scheduled
Termination Date one or more Loans (each a "Non-Consenting Lender Loan") on a
pro rata basis equal, in each case, to an amount specified in the Borrower's
election that is no greater than such Non-Consenting Lender's Unused Commitment.
The proceeds of any such Non-Consenting Lender Loans shall be deposited with the
Agent and applied on the next Amortization Date to repay solely Loans then owed
Amsterdam without thereby reducing the aggregate principal amount of outstanding
Loans. Thereafter, such Non-Consenting Lender Loans and any outstanding Loans of
a Direct Lender that is or was a Non-Consenting Lender shall be repaid to the
extent provided pursuant to Sections 2.3 and 3.2 for Loans of a Liquidity
Provider. If an extension of the Scheduled Termination Date is agreed to by the
Enhancer and Liquidity Providers having Commitments that together with the
Enchancer's Commitment constitute a majority of the Commitments and such
extension takes place pursuant to this Section 2.11(b), the Scheduled
Termination Date shall be extended for the Enhancer and the Consenting Lenders
(or replacement Lenders, as applicable) for an additional 364 day period.
ARTICLE III
SALES TO AND FROM AMSTERDAM; ALLOCATIONS
Section 3.1. Required Purchases from Amsterdam. (a) Amsterdam
may, at any time on or prior to the Liquidity Termination Date, and, on the
earlier of the Amsterdam Termination Date and upon the Agent and Amsterdam
learning of a continuing Put Event, Amsterdam shall, sell to the Committed
Lenders (other than the Direct Lenders) any percentage designated by Amsterdam
of Amsterdam's Principal Amount (each, a "Put"). If the Put occurs due to the
Amsterdam Termination Date or a Put Event, the designated percentage shall be
100% or such lesser percentage as is necessary to obtain the maximum available
Purchase Price from each such Committed Lender. Immediately upon notice of a
Put from Amsterdam to the Agent, the Agent shall deliver to each such Committed
Lender and the Borrower a notification of assignment in substantially the form
of Exhibit C by not later than 12:30 p.m. (Chicago time), and each such
Committed Lender shall purchase from Amsterdam its Purchase Percentage of
Amsterdam's Principal Amount subject to such Put by transferring to the Agent's
Account an amount equal to such Lender's Purchase Price by not later than 1:00
p.m. (Chicago time) on the date such funds are requested; provided, however,
that the Enhancer may exchange for part or all of the Purchase Price payable by
it an equal amount of the Program Unreimbursed Draw Amount.
(b) If a Liquidity Provider fails to transfer to the Agent its full
Purchase Price when required by Section 3.1(a) (each such Liquidity Provider
being a "Defaulting Lender" and the aggregate amount not made available to the
Agent by each such Liquidity Provider being the
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"Unpaid Amount"), then, upon notice from the Agent by not later than 1:15 p.m.
(Chicago time), each Liquidity Provider not owing an Unpaid Amount shall
transfer to the Agent's Account, by not later than 1:45 p.m. (Chicago time), an
amount equal to the lesser of such Liquidity Provider's proportionate share
(based on its Commitment divided by the Commitments of all Liquidity Providers
that have not so failed to pay their full Purchase Price) of the Unpaid Amount
and the unused portion of its Commitment. If the Agent does not then receive the
Unpaid Amount in full, upon notice from the Agent by not later than 2:00 p.m.
(Chicago time) on such day, each Liquidity Provider that has not failed to fund
any part of its obligations on such day under this Section 3.1 shall pay to the
Agent, by not later than 2:30 p.m. (Chicago time), its proportionate share
(determined as described above) of the amount of such remaining deficiency up to
the amount of the unused portion of its Commitment. Any Defaulting Lender that
fails to make a payment under this Section 3.1 relating to such Unpaid Amount on
the date of a Put shall pay on demand to each other Liquidity Provider that
makes a payment under this subsection (b) the amount of such payment, together
with interest thereon, for each day from the date such payment was made until
the date such other Liquidity Provider has been paid such amount in full, at a
rate per annum equal to the Federal Funds Rate plus two percent (2%) per annum.
In addition, without prejudice to any other rights Amsterdam may have under
applicable law, any Defaulting Lender shall pay on demand to Amsterdam the
difference between such unpaid Purchase Price and the amount paid by other
Liquidity Providers or the Agent to cover such failure, together with interest
thereon, for each day from the date such Purchase Price was due until the date
paid, at a rate per annum equal to the Federal Funds Rate plus two percent (2%)
per annum. Notwithstanding anything in Section 3.2 or elsewhere in this
Agreement to the contrary, no Defaulting Lender shall receive any payment of
principal, interest or any other amount hereunder until the Unpaid Amount owed
by such Defaulting Lender is recovered by Amsterdam or, if funded by the other
Liquidity Providers pursuant to this subsection (b), by such Liquidity
Providers. For such purposes, all amounts otherwise payable to such Defaulting
Lender hereunder shall be applied to satisfy its obligations to Amsterdam and/or
the Liquidity Providers until such obligations are fully satisfied, with such
payments by the Borrower nevertheless discharging the obligations owed to the
Defaulting Lender that otherwise would have been satisfied by such payment, and
each Defaulting Lender is hereby directing such use of funds received for its
benefit hereunder to satisfy any Unpaid Amount owed by such Defaulting Lender.
(c) Any portion of Amsterdam's Principal Amount purchased by a Committed
Lender (including any purchased under Section 3.1(b) in fulfillment of another
Committed Lender's obligation unless such purchase is reimbursed in full, with
interest, by such other Committed Lender under Section 3.1(b)) shall be
considered part of such Lender's Principal Amount from the date of the relevant
Put. Each such sale by Amsterdam to a Committed Lender shall be without
recourse, representation or warranty except for the representation and warranty
that such Principal Amount and related amounts are being sold by Amsterdam free
and clear of any Lien created or granted by Amsterdam. Immediately upon any
purchase by the Committed Lenders of any portion of Amsterdam's Principal
Amount, the Borrower shall pay to the Agent (for the ratable benefit of such
Lenders) an amount equal to the sum of the amount calculated for all such
Lenders pursuant to clause (b) of the definition of Purchase Price. Such
payment shall discharge the obligations described in such clause (b).
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(d) The proceeds from each Put received by Amsterdam (other than amounts
described in clauses (b)(ii) and (iii) of the definition of Purchase Price)
shall be transferred into the Special Transaction Subaccount and used solely to
pay that portion of the outstanding commercial paper of Amsterdam issued to fund
or maintain the Principal Amount of Amsterdam so transferred.
(e) The obligation of each Committed Lender (other than the Direct
Lenders) to make any purchase from Amsterdam pursuant to this Section 3.1 or
Section 2.2(c) shall be several, not joint, and shall be absolute and
unconditional; provided, however, that no such Committed Lender shall have any
obligation to make such a purchase at a time that (i) Amsterdam shall have
voluntarily commenced any proceeding or filed any petition under any bankruptcy,
insolvency or similar law seeking the dissolution, liquidation or reorganization
of Amsterdam or (ii) involuntary proceedings or an involuntary petition shall
have been commenced or filed against Amsterdam under any bankruptcy, insolvency
or similar law seeking the dissolution, liquidation or reorganization of
Amsterdam and such proceeding or petition shall not have been dismissed or
stayed for a period of thirty (30) days, or any of the actions sought in such
proceeding or petition (including the entry of an order for relief against, or
the appointment of a receiver, trustee, custodian or other similar official for,
Amsterdam or for any substantial part of Amsterdam's property) shall occur.
(f) Each Funding Liquidity Provider, by its acceptance hereof, severally
agrees to purchase from each other Committed Lender that has purchased a portion
of Amsterdam's Principal Amount, and each Committed Lender purchasing a portion
of Amsterdam's Principal Amount hereby agrees to sell to each such Funding
Liquidity Provider, an undivided percentage participating interest in an amount
equal to the amount calculated for such Committed Lender pursuant to clause (b)
of the definition of Purchase Price. Such participating interests shall be
purchased and sold to the extent necessary to cause the amount of each Funding
Liquidity Provider's participating interest in such amount to be equal to its
Ratable Share of such amount. After the payment by the relevant Committed
Lenders of the Purchase Price of any Put, each Funding Liquidity Provider shall,
not later than the Business Day it receives a request therefor from a Committed
Lender (given directly or through the Agent) to such effect, if such request is
received before 1:00 P.M. (New York City time), or not later than the following
Business Day, if such request is received after such time, pay to the Agent for
the account of the Committed Lenders an amount equal to its Ratable Share of
such amount, together with interest on such amount accrued from the date the
payment was made by the Committed Lenders to the date of such payment by such
Funding Liquidity Provider at a rate per annum equal to (i) from the date the
related payment was made by the Committed Lenders to the date two (2) Business
Days after payment by such Funding Liquidity Provider is due hereunder, the
Federal Funds Rate for each such day and (ii) from the date two (2) Business
Days after such payment is due from such Funding Liquidity Providers to the date
such payment is made by such Funding Liquidity Providers, the Base Rate in
effect for each such day. Each such Funding Liquidity Providers shall
thereafter be entitled to receive its Ratable Share of each payment received in
respect of the relevant amount and of interest paid thereon, with each Committed
Lender retaining its Ratable Share.
The several obligations of the Funding Liquidity Providers to each
Committed Lender under this Section 3.1(f) shall be absolute, irrevocable and
unconditional under any and all
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circumstances whatsoever and shall not be subject to any set-off, counterclaim
or defense to payment which any Funding Liquidity Providers may have or have had
against the Borrower, any Committed Lender or any other Person whatsoever.
Without limiting the generality of the foregoing, such obligations shall not be
affected by any Default or by any reduction or termination of any Commitment of
any Committed Lender. The Agent shall be entitled to offset amounts received for
the account of Committed Lenders under this Section against unpaid amounts due
from Committed Lenders hereunder (whether as fundings of participations,
indemnities or otherwise) but shall not be entitled to offset against amounts
owed to the Agent by any Committed Lender arising outside this Agreement.
Section 3.2. Allocations and Distributions.
(a) Before Amsterdam Termination Date. Subject to Section 3.2(d), at all
times before the Amsterdam Termination Date payments received hereunder on the
Obligations, other than payments of principal, shall be distributed to the
Lenders ratably in payment of amounts then due and owing to each Lender
hereunder and payments of principal received on the Loans hereunder shall be
distributed to the Lenders in payment of such Borrowings, in whole or in part,
as the Borrower identifies to the Agent for repayment (or, in the absence of
such designation, to the Borrowing(s) that have their Interest Period(s) ending
on or the soonest after such date, with the Agent selecting such applications in
its sole discretion if more than one Borrowing satisfies such criteria).
Notwithstanding anything in this Section 3.2(a) to the contrary, all payments of
Borrowings from Committed Lenders will be applied ratably to the Loans held by
such Committed Lenders that comprise such Borrowing.
(b) Amsterdam Termination Date. Subject to Section 3.2(d), at all times
on and after the Amsterdam Termination Date that the Liquidity Termination Date
has not occurred, all payments of principal received on the Loans shall be
applied first to repay Loans then held by Amsterdam, as selected by the Agent,
and thereafter in accordance with Section 3.2(a) and all other payments received
on the Obligations shall be distributed as provided in Section 3.2(a).
(c) Liquidity Termination Date. Subject to Section 3.2(d), at all times
on and after the Liquidity Termination Date, all payments of principal received
on the Loans shall be applied ratably between Borrowings outstanding from
Amsterdam and the Liquidity Providers, as designated by the Agent, and all other
payments received on the Obligations shall be distributed in accordance with
Section 3.2(a).
(d) Acceleration; Shortfalls. At any time the maturity of any Loans has
been accelerated pursuant to Section 8.2 or 8.3 or any payment is received on
the Obligations representing less than the total amount then due and owing
hereunder, all payments received on the Obligations, including from the
Collateral Agent as proceeds of Collateral, shall be applied as follows:
(i) first, to Amsterdam and to the Liquidity Providers (ratably,
based on the Matured Value of the Loans they hold) as payments of principal
and interest on their Loans until all such principal and interest owed to
the Liquidity Providers and Amsterdam has been paid in full;
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(ii) second, to the Enhancer as payments of principal and interest
on its Loans until all such principal and interest owed to the Enhancer has
been paid in full;
(iii) third, to the Lenders (ratably based on the remaining
Obligations owed to each) as payment of all other Obligations not covered
in clauses (i) and (ii) above owed to Lenders until all such Obligations
have been paid in full;
(iv) fourth, to the Agent as payment of Obligations owed to it until
all such Obligations have been paid in full; and
(v) fifth, to the Borrower (or as otherwise required by applicable
law).
ARTICLE IV
INDEMNIFICATION
Section 4.1. Legal Fees, Other Costs and Indemnification. (a) The
Borrower, upon demand by the appropriate Person, agrees to pay the reasonable
out-of-pocket costs and expenses (i) of the Agent and the Collateral Agent,
including, without limitation the reasonable fees and disbursements of legal
counsel to the Agent and the Collateral Agent, in connection with the
preparation and execution of the Credit Documents, and any amendment, waiver or
consent related thereto, whether or not the transactions contemplated therein
are consummated, and (ii) of the Agent, the Collateral Agent and the Lenders in
connection with advising the Agent, the Collateral Agent and the Lenders of
their rights and responsibilities under the Credit Documents during any Default
or in connection with the enforcement by the Lenders, the Agent and the
Collateral Agent of any of the Credit Documents against either Credit Party,
provided that the Agent, the Collateral Agent and the Lenders agree to the
extent feasible and to the extent a conflict of interest does not exist in the
reasonable opinion of any of the foregoing, to use the same single counsel in
connection with the foregoing to the extent they seek reimbursement for the
expenses thereof from the Borrower. The Borrower further agrees to indemnify
each Lender, the Agent, the Collateral Agent and their respective directors,
officers, employees and attorneys (in each case in their capacities as such)
(collectively, the "Indemnified Parties"), against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all reasonable attorneys' fees and other reasonable expenses of litigation or
preparation therefor, whether or not such Indemnified Party is a party thereto,
but excluding any Taxes and excluding any losses, claims, damages, penalties,
judgments, liabilities or expenses of the nature described in Sections 2.8(b)
and 4.4 (regardless of whether indemnified pursuant to such sections)) which any
of them may pay or incur arising out of or relating to (x) any action, suit or
proceeding by any Person not a party to this Agreement (a "third party") or
governmental authority against such Indemnified Party and relating to the
execution, delivery or performance (or non-performance) of any Credit Document
by either Credit Party, the Loans or the application or proposed application by
the Borrower of the proceeds of any Loan, REGARDLESS OF WHETHER SUCH CLAIMS OR
ACTIONS ARE FOUNDED IN WHOLE OR IN PART UPON THE ALLEGED SIMPLE OR CONTRIBUTORY
NEGLIGENCE OF ANY OF THE INDEMNIFIED PARTIES AND/OR ANY OF THEIR RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES OR ATTORNEYS, (y) any investigation of any third
party or any governmental authority involving any Lender (as a lender hereunder)
or the Agent or the Collateral Agent (in such capacity hereunder) and related to
any use made or
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proposed to be made by the Borrower of the proceeds of the Borrowings, or any
transaction financed or to be financed in whole or in part, directly or
indirectly with the proceeds of any Borrowing, and (z) any investigation of any
third party or any governmental authority, litigation or proceeding involving
any Lender (as a lender hereunder) or the Agent or the Collateral Agent (in such
capacity hereunder) and related to any environmental cleanup, audit or
compliance with respect to the Borrower or its properties, or any other matter
relating to any Environmental Law or the presence of any Hazardous Material
(including, without limitation, any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under any Environmental Law) with
respect to the Borrower or its properties, regardless of whether caused by, or
within the control of, the Borrower; provided, however, that the Borrower shall
not be obligated to indemnify any Indemnified Party for any of the foregoing
arising out of such Indemnified Party's, or the Agent's or the Collateral
Agent's, as the case may be, gross negligence, willful misconduct or breach of
any material provision of any Credit Document or the gross negligence or wilful
misconduct of, or the breach of any material provision of any Credit Document
by, any other Indemnified Party with respect to the same Lender. The Borrower,
upon demand by the Agent or the Collateral Agent at any time, shall reimburse
the applicable Indemnified Party for any reasonable legal or other expenses
incurred in connection with investigating or defending against any of the
foregoing except if the same is excluded from indemnification pursuant to the
provisions of the preceding sentence.
(b) Promptly after receipt by an Indemnified Party of notice of the
commencement of any action, suit or proceeding against such Indemnified Party
relating to any of the matters described in Section 4.1(a), such Indemnified
Party shall give written notice to the Borrower of the commencement thereof, but
the failure so to notify the Borrower shall not relieve it of any liability that
it may have to any Indemnified Party except to the extent the Borrower
demonstrates that the defense of such action is prejudiced thereby. The
Borrower shall be entitled to participate therein and, to the extent that it
shall elect, to assume the defense thereof with counsel reasonably satisfactory
to such Indemnified Party and, after notice from the Borrower to such
Indemnified Party of its election so to assume the defense thereof, the Borrower
shall not be liable to such Indemnified Party hereunder for any fees of other
counsel or any other expenses, in each case subsequently incurred by such
Indemnified Party in connection with the defense thereof, other than reasonable
costs of investigation. If the Borrower assumes the defense of such action,
suit or proceeding, (i) no compromise or settlement thereof may be effected by
the Borrower without the applicable Indemnified Party's consent (which shall not
be unreasonably withheld) unless (x) there is no finding or admission of any
violation of law or any violation of the rights of any Person, no fine or
penalty is assessed against, or payable by, such Indemnified Party and there are
no other claims that may be made by the claimant in such action, suit or
proceeding against such Indemnified Party, in each case as a result of such
compromise or settlement, and (y) the sole relief provided is monetary damages
that are paid in full by the Borrower, and (ii) the Borrower shall have no
liability with respect to any compromise or settlement thereof effected without
its consent (which shall not be unreasonably withheld). If notice is given to
the Borrower of the commencement of any action, suit or proceeding and it does
not, within ten (10) days after the notice is given, give written notice to such
Indemnified Party of its election to assume the defense thereof, the Borrower
shall be bound by any determination made in such action or any compromise or
settlement thereof effected by such Indemnified Party. Notwithstanding the
foregoing, if an Indemnified Party determines in good
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faith that there is a reasonable probability that an action may adversely affect
it or its Affiliates other than as a result of monetary damages, such
Indemnified Party may, by notice to the Borrower, assume the exclusive right to
defend, compromise or settle such action, suit or proceeding, but the Borrower
shall not be bound by any determination of an action so defended or any
compromise or settlement thereof effected without its consent (which shall not
be unreasonably withheld). Nothing in this Section 4.1(b) shall require the
Borrower to make any payment that it is not required to make under Section
4.1(a).
Section 4.2. Change of Law. (a) Notwithstanding any other
provisions of this Agreement, if at any time any change, after the date hereof
(or, if later, after the date the applicable Committed Lender becomes a Lender),
in applicable law or regulation or in the interpretation thereof makes it
unlawful for any Committed Lender to make or continue to maintain Eurodollar
Loans, such Committed Lender shall promptly give written notice thereof and of
the basis therefor in reasonable detail to the Borrower and such Lender's
obligations to advance, continue or convert Loans into Eurodollar Loans under
this Agreement shall thereupon be suspended until it is no longer unlawful for
such Committed Lender to make or maintain Eurodollar Loans.
(b) Upon the giving of the notice to Borrower referred to in subsection
(a) above, (i) any outstanding Eurodollar Loan of such Lender shall be
automatically converted to a Base Rate Loan on the last day of the Interest
Period then applicable thereto or on such earlier date as required by law, and
(ii) such Lender shall maintain its funding of its Loan that is part of any
requested Borrowing of Eurodollar Loans as a Base Rate Loan, which Base Rate
Loan shall, for all other purposes, be considered part of such Borrowing.
(c) Any Committed Lender that has given any notice pursuant to Section
4.2(a) shall, upon determining that it would no longer be unlawful for it to
fund Eurodollar Loans, give prompt written notice thereof to the Borrower and
the Agent, and upon giving such notice, its obligation to advance, allow
conversions into and continue Eurodollar Loans shall be reinstated.
Section 4.3. Unavailability of Deposits or Inability to Ascertain LIBOR.
If on or before the first day of any Interest Period for any Eurodollar
Borrowing the Agent determines in good faith (after consultation with the
Committed Lenders) that, due to changes in circumstances since the Effective
Date, adequate and fair means do not exist for determining the Eurodollar Rate
or such rate will not accurately reflect the cost to the Instructing Group of
funding Eurodollar Loans for such Interest Period, the Agent shall give written
notice (in reasonable detail) of such determination and of the basis therefor to
the Borrower and the Committed Lenders, whereupon until the Agent notifies the
Borrower and Committed Lenders that the circumstances giving rise to such
suspension no longer exist (which the Agent shall do promptly after they do not
exist), (i) the obligations of the Committed Lenders to advance, continue or
convert Loans into Eurodollar Loans shall be suspended and (ii) each Eurodollar
Loan will, automatically on the last day of the then existing Interest Period
therefor, convert into a Base Rate Loan.
Section 4.4. Increased Cost and Reduced Return. (a) If, on or
after the date hereof (or, if later, after the date the applicable Committed
Lender becomes a Committed Lender), the adoption of or any change in any
applicable law, rule or regulation, or any change in the
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interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Committed Lender (or its Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency exercising control over banks or
financial institutions generally issued after the date hereof (or, if later,
after the date such Committed Lender becomes a Committed Lender) (other than any
request or directive requesting or in effect requiring compliance with any
applicable law, rule or regulation imposing or in effect imposing a fine or
penalty for any failure to comply with any such law, rule or regulation):
(i) subjects any Committed Lender (or its Lending Office) to any
tax, duty or other similar charge related to any Eurodollar Loan, or its
participation in any thereof, or its obligation to advance or maintain
Eurodollar Loans or to participate therein, or shall change the basis of
taxation of payments to any Committed Lender (or its Lending Office) of the
principal of or interest on its Eurodollar Loans or participations therein,
or any other amounts due under this Agreement related to its Eurodollar
Loans or participations therein, or its obligation to advance or maintain
Eurodollar Loans or acquire participations therein (except for changes with
respect to income or franchise taxes excluded from indemnification pursuant
to Section 4.7); or
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding for any Eurodollar Loan any such requirement included
in an applicable Reserve Requirement) against assets of, deposits with or
for the account of, or credit extended by, any Committed Lender (or its
Lending Office) or imposes on any Committed Lender (or its Lending Office)
or on the interbank market any other condition affecting its Eurodollar
Loans owed to it, or its participation in any thereof, or its obligation to
advance or maintain Eurodollar Loans or participate in any thereof;
and the result of any of the foregoing is to increase in the future the cost to
such Committed Lender (or its Lending Office) of advancing or maintaining any
Eurodollar Loan or participating therein, or to reduce the amount of any sum
received or receivable by such Committed Lender (or its Lending Office) in
connection therewith under this Agreement, by an amount deemed by such Committed
Lender to be material, then, subject to Section 4.4(c), from time to time,
within thirty (30) days after receipt of a certificate from such Committed
Lender (with a copy to the Agent) pursuant to subsection (c) below setting forth
in reasonable detail such determination and the basis thereof, the Borrower
shall be obligated to pay to such Committed Lender such additional amount or
amounts as will compensate such Committed Lender for such future increased cost
or reduction.
(b) If, after the date hereof (or, if later, the date any such Funding
Party becomes a Funding Party), the Agent or any Lender (collectively, the
"Funding Parties") shall have reasonably determined that (i) the adoption after
the date hereof of (x) any applicable law, rule or regulation regarding capital
adequacy, or (y) any change therein (including, without limitation, any revision
after the date hereof in the Final Risk-Based Capital Guidelines of the Board of
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Governors of the Federal Reserve System (12 CFR Part 208, Appendix A; 00 XXX
Xxxx 000, Xxxxxxxx X) or of the Office of the Comptroller of the Currency (12
CFR Part 3, Appendix A), or in any other applicable capital adequacy rules
heretofore adopted and issued by any governmental authority), (ii) any change
after the date hereof in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration of any such applicable law, rule or regulation
regarding capital adequacy, or (iii) compliance by any Funding Party or its
Lending Office with any request or directive of general applicability issued
after the date hereof regarding capital adequacy (whether or not having the
force of law) of any such authority, central bank or comparable agency (other
than any request or directive requiring or in effect requiring compliance with
any applicable law, rule or regulation regarding capital adequacy or imposing
fines or penalties for any failure to comply with any such law, rule or
regulation), has or would have the effect of reducing in the future the rate of
return on such Funding Party's capital, or on the capital of any corporation
controlling such Funding Party, as a consequence of its obligations hereunder to
a level below that which such Funding Party or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Funding Party's or its controlling corporation's policies with respect to
capital adequacy in effect immediately before such adoption, change or
compliance) by an amount reasonably deemed by such Funding Party to be material,
then, subject to Section 4.4(c), from time to time, within thirty (30) days
after its receipt of a certificate from such Funding Party (with a copy to the
Agent) pursuant to subsection (c) below setting forth in reasonable detail such
determination and the basis thereof, the Borrower shall pay to such Funding
Party such additional amount or amounts as will compensate such Funding Party or
such corporation for such future reduced return or the Borrower may prepay all
Eurodollar Loans of such Committed Lender.
(c) Any Funding Party that determines to seek compensation under this
Section 4.4 shall give written notice to the Borrower and, in the case of a
Funding Party other than a Funding Party which is the Agent, the Agent of the
circumstances that entitle the Agent or such Funding Party to such compensation
no later than ninety (90) days after such Funding Party receives actual notice
or obtains actual knowledge of the law, rule, order or interpretation or
occurrence of another event giving rise to a claim hereunder. In any event the
Borrower shall not have any obligation to pay any amount with respect to claims
accruing, or for periods, prior to the ninetieth day preceding such written
demand. The Agent and each Funding Party shall use reasonable efforts to avoid
the need for, or reduce the amount of, such compensation and any payment under
Section 4.7, including, without limitation, the designation of a different
Lending Office, if such action or designation will not, in the sole judgment of
the Agent or such Funding Party made in good faith, be otherwise disadvantageous
to it; provided that the foregoing shall not in any way affect the rights of any
Funding Party or the obligations of the Borrower under this Section 4.4, and
provided further that no Committed Lender shall be obligated to make its
Eurodollar Loans hereunder at any office located in the United States of America
and the Enhancer, in its capacity as issuer of the Program LOC, shall not have
any obligation to change the office from which it issues and maintains the
Program LOC. A certificate of the Agent or any Funding Party, as applicable,
claiming compensation under this Section 4.4 and setting forth the additional
amount or amounts to be paid to it hereunder and accompanied by a statement
prepared by the Agent or such Funding Party, as applicable, describing in
reasonable detail the calculations thereof shall be rebuttable presumptive
evidence thereof in the absence of manifest
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error. In determining such amount, such Person may use any reasonable averaging
and attribution methods.
Section 4.5. Lending Offices. Each Committed Lender may, at its option,
elect to make and maintain its Loans hereunder at the Lending Office for
each type of Loan available from it hereunder or at such other of its branches,
offices or affiliates as it may from time to time elect and designate in a
written notice to the Borrower and the Agent, provided that, except that in the
case of any such transfer to another of its branches, offices or affiliates made
at the request of the Borrower, the Borrower shall not be responsible for the
costs arising under Section 4.7 or 4.4 resulting from any such transfer to the
extent not otherwise applicable to such Committed Lender prior to such transfer.
Section 4.6. Discretion of Lender as to Manner of Funding. Subject to the
other provisions of this Agreement, each Lender shall be entitled to fund and
maintain its funding of all or any part of its Loans in any manner it sees fit.
Section 4.7. Withholding Taxes. (a) Payments Free of Withholding.
Except as otherwise required by law and subject to Section 4.7(b), each payment
by the Borrower or Transocean to any Lender or the Agent under this Agreement or
any other Credit Document shall be made without withholding for or on account of
any present or future taxes imposed by or within the jurisdiction in which the
Borrower or Transocean is domiciled, any jurisdiction from which the Borrower or
Transocean makes any payment, or (in each case) any political subdivision or
taxing authority thereof or therein, excluding, in the case of each Lender and
the Agent, taxes, assessments or other governmental charges:
(i) imposed on, based upon, or measured by its income, and branch
profits, franchise and similar taxes imposed on it, by any jurisdiction in
which such Lender or the Agent, as the case may be, is incorporated or
maintains its principal place of business or Lending Office or which
subjects such Lender or the Agent to tax by reason of a connection between
the taxing jurisdiction and such Lender or the Agent (other than a
connection resulting from the transactions contemplated by this Agreement);
(ii) imposed as a result of a connection between the taxing
jurisdiction and such Lender or the Agent, as the case may be, other than a
connection resulting from the transactions contemplated by this Agreement;
(iii) imposed as a result of the transfer by such Lender of its
interest in this Agreement or any other Credit Document or a designation by
such Lender (other than pursuant to Section 4.4(c)) of a new Lending Office
(other than taxes imposed as a result of any change in treaty, law or
regulation after such transfer of such Lender's interest in this Agreement
or any other Credit Document or designation of a new Lending Office);
(iv) imposed by the United States of America upon a Lender organized
under the laws of a jurisdiction outside of the United States, except to
the extent that such tax is imposed or increased as a result of any change
in applicable law, regulation or treaty (other than any addition of or
change in any "anti-treaty shopping," "limitation of
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benefits," or similar provision applicable to a treaty) after the date
hereof, in the case of each Lender originally a party hereto or, in the
case of any other Lender, after the date on which it becomes a Lender; or
(v) which would not have been imposed but for (A) the failure of any
Lender or the Agent, as the case may be, to provide an Internal Revenue
Service Form W-8BEN or W-8ECI, as the case may be, or any substitute or
successor form prescribed by the Internal Revenue Service, pursuant to
Section 4.7(b), or any other certification, documentation or proof which is
reasonably requested by the Borrower, or (B) a determination by a taxing
authority or a court of competent jurisdiction that a certification,
documentation or other proof provided by such Lender or the Agent to
establish an exemption from such tax, assessment or other governmental
charge is false.
(all such non-excluded taxes, assessments or other governmental charges and
liabilities being herein referred to as "Indemnified Taxes"). If any such
withholding is so required, the Borrower or Transocean, as applicable, shall
make the withholding, pay the amount withheld to the appropriate governmental
authority before penalties attach thereto or interest accrues thereon and
forthwith pay such additional amount as may be necessary to ensure that the net
amount actually received by each Lender and the Agent is free and clear of such
Indemnified Taxes (including Indemnified Taxes on such additional amount) and is
equal to the amount that such Lender or the Agent (as the case may be) would
have received had such withholding not been made. If the Agent or any Lender
pays any amount in respect of any Indemnified Taxes, penalties or interest, the
Borrower or Transocean, as applicable, shall reimburse the Agent or that Lender
for such payment on demand in the currency in which such payment was made. If
the Borrower or Transocean pays any Indemnified Taxes, or penalties or interest
in connection therewith, it shall deliver official tax receipts evidencing the
payment or certified copies thereof, or other satisfactory evidence of payment
if such tax receipts have not yet been received by the Borrower or Transocean
(with such tax receipts to be promptly delivered when actually received), to the
Lender or Agent on whose account such withholding was made (with a copy to the
Agent if not the recipient of the original) within fifteen (15) days of such
payment. Each such Lender shall make written demand on the Borrower for
indemnification or compensation hereunder no later than ninety (90) days after
the earlier of (i) the date on which such Lender or the Agent makes payment of
Indemnified Taxes, and (ii) the date on which the relevant taxing authority or
other governmental authority makes written demand upon such Lender or the Agent
for payment of Indemnified Taxes. In the event that such Lender or the Agent
fails to give the Borrower timely notice as provided herein, the Borrower shall
not have any obligation to pay such claim for compensation or indemnification.
(b) U.S. Withholding Tax Exemptions. Each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the Borrower and the Agent on or before the Funding Date, two duly
completed and signed copies of either Form W-8BEN (entitling such Lender to a
complete exemption from withholding under the Code on all amounts to be received
by such Lender, including fees, pursuant to the Credit Documents) or Form W-8ECI
(relating to all amounts to be received by such Lender, including fees, pursuant
to the Credit Documents) of the United States Internal Revenue Service.
Thereafter and from time to time, each such Lender shall submit to the Borrower
and the Agent
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such additional duly completed and signed copies of one or the other of such
forms (or such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may be (i) notified by the
Borrower, directly or through the Agent, to such Lender, and (ii) required under
then-current United States law or regulations to avoid United States withholding
taxes on payments in respect of all amounts to be received by such Lender,
including fees, pursuant to the Credit Documents. Upon the request of the
Borrower, each Lender that is a United States person shall submit to the
Borrower a certificate to the effect that it is a United States person.
(c) Inability of Lender to Submit Forms. If any Lender determines, as a
result of any change in applicable law, regulation or treaty, or in any official
application or interpretation thereof, that it is unable to submit to the
Borrower or Agent any form or certificate that such Lender is obligated to
submit pursuant to subsection (b) of this Section 4.7 or that such Lender is
required to withdraw or cancel any such form or certificate previously submitted
or any such form or certificate otherwise becomes ineffective or inaccurate,
such Lender shall promptly notify the Borrower and Agent of such fact and such
Lender shall to that extent not be obligated to provide any such form or
certificate and will be entitled to withdraw or cancel any affected form or
certificate, as applicable.
(d) Refund of Taxes. If any Lender or the Agent receives a refund of any
Indemnified Tax or any documentary, stamp or similar taxes with respect to which
the Borrower or Transocean has paid any amount pursuant to this Section 4.7,
such Lender or the Agent shall promptly notify the Borrower and Transocean and
shall pay the amount of such refund (including any interest received with
respect thereto) to the Borrower or Transocean.
ARTICLE V
CONDITIONS PRECEDENT
Section 5.1. Conditions to Closing. This Agreement shall become
effective on the first date all conditions in this Section 5.1 are satisfied
(and the advance of the first Loan hereunder shall conclusively establish the
effectiveness of this Agreement for all purposes). (1) On or before such date,
the Borrower shall deliver to the Agent the following documents in form,
substance and quantity acceptable to the Agent:
(a) A certificate of the Secretary or Assistant Secretary of each of
the Borrower and Transocean certifying (i) the resolutions of each Credit
Party's board of directors approving each Credit Document to which it is a
party, (ii) the name, signature, and authority of each officer who executes
on the Borrower's or Transocean's behalf a Credit Document (on which
certificate the Agent and each Lender may conclusively rely until a revised
certificate is received), (iii) the Borrower's and Transocean's certificate
or articles of incorporation certified by the Secretary of State of its
state of incorporation, (iv) a copy of the Borrower's and Transocean's by-
laws and (v) good standing certificates issued by the Secretaries of State
of each jurisdiction where the Borrower or Transocean has material
operations as and to the extent agreed with the Agent.
(b) The Security Documents and the Collateral Agreement.
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(c) All instruments and other documents required, or deemed
desirable by the Agent, to perfect the Collateral Agent's first priority
(subject to Permitted Liens) security interest for the benefit of the
Lenders and the Swap Parties in the Collateral in all appropriate
jurisdictions, including, without limitation, a certificate from the
Collateral Agent confirming that it holds a security interest for the
benefit (without limitation) of the Lenders in the Drillship, the Rig, the
Amoco Contracts and the other Collateral under the Security Documents and
the Collateral Agreement as collateral security for (without limitation)
the obligations of the Borrower under this Agreement.
(d) UCC search reports and any other lien search or title reports
from all jurisdictions the Agent requests showing no Liens against the
Collateral other than Permitted Liens.
(e) (i) Executed copies of all documents evidencing any necessary
corporate action, consents and government authorizations taken or obtained
by the Borrower or Transocean in connection with the Credit Documents, (ii)
an executed pro forma Monthly Report setting forth the Excess Cash Flow
calculation and demonstrating compliance with the Borrowing Base, in each
case as of the Effective Date, and (iii) executed copies of each Credit
Document.
(f) Favorable opinions of counsel to the Borrower and Transocean
(and, if requested by Amsterdam, the Enhancer or any Liquidity Provider and
then at the expense of the Borrower) covering such matters as Amsterdam or
the Agent may request.
(g) An insurance certificate on behalf of the Borrower dated within
ten (10) days of the Funding Date from the Borrower describing in
reasonable detail the insurance maintained by the Borrower as required by
the Credit Documents.
(h) Such other approvals, opinions or documents as the Agent or
Amsterdam may request.
(2) The construction of the Drillship and the upgrade of the Rig shall
have been completed substantially in accordance with the Functional Requirements
therefor (as certified to the Agent and the Lenders by ABS Marine Services, Inc.
or such other engineer selected by the Agent with the consent of the Borrower,
which consent shall not be unreasonably withheld).
(3) The Borrower shall have delivered to the Agent a copy of the Amoco
Letter of Acceptance for each of the Drillship and the Rig in substantially the
form of Exhibit 5.1B.
(4) The Borrower shall have furnished to the Agent a certificate executed
on behalf of the Borrower by a Senior Officer, which indicates that it is made
in favor of and for the benefit of the Agent and each of the Lenders certifying,
representing and warranting that:
(A) the Drillship and the Rig have been constructed substantially in
compliance with the Functional Requirements therefor;
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(B) all amounts (other than amounts being contested in good faith by
the Borrower and for which reserves in conformity with GAAP have been
provided) then due and owing by the Borrower and/or Transocean to third
parties for the construction of the Drillship and the upgrade of the Rig,
including, without limitation, all amounts (other than amounts being
contested in good faith by the Borrower and for which reserves in
conformity with GAAP have been provided) due and owing by the Borrower
and/or Transocean under the Drillship Shipyard Construction Contract, under
the Rig Shipyard Construction Contract and for all other construction
costs, have been paid in full;
(C) the Borrower owns each of the Drillship and the Rig, free and
clear of all Liens other than Permitted Liens;
(D) (I) neither the Borrower nor Transocean has received written
notice from or on behalf of Amoco that (x) any default or event of default
(in each case, as defined in the relevant Amoco Contract) under either of
the Amoco Contracts has occurred and any such alleged default or event of
default is continuing (it being understood and agreed that such default or
event of default shall cease to be "continuing" for the purposes of this
Agreement when it shall cease to constitute a continuing default or event
of default under the applicable Amoco Contract for any reason (including,
without limitation, as a result of the curing thereof or any waiver or
modification thereunder)), (y) Amoco intends to take or has taken any steps
to cancel or terminate either of the Amoco Contracts (other than, with
respect to the Amoco Rig Contract, if a cancellation fee or termination fee
is to be paid pursuant to the terms thereof or other than the free
cancellation provided in such contract), or (z) either of the Amoco
Contracts is otherwise no longer in full force and effect; and (II) the
Borrower is not aware, of any default or event of default (in each case, as
defined in the relevant Amoco Contract) under either of the Amoco Contracts
has occurred and is continuing (it being understood and agreed that such
default or event of default shall cease to be "continuing" for the purposes
of this Agreement when it shall cease to constitute a continuing default or
event of default under the applicable Amoco Contract for any reason
(including, without limitation, as a result of the curing thereof or any
waiver or modification thereunder)) after any applicable grace period; and
(E) the Borrower has obtained loss of hire insurance with respect to
each of the Drillship and the Rig as required by Section 7.1(f).
Section 5.2. Conditions to Advance of Each Loan on Funding Date.
The obligation of each Committed Lender to make any Loan, and the right of the
Borrower to request or accept any Loan, on the Funding Date are subject to the
conditions (and each Borrowing shall evidence the Borrower's representation and
warranty that each such condition has been satisfied) that on the date of such
Borrowing before and after giving effect to the Borrowing:
(a) on the Funding Date the Construction Loans and the "Tranche A
Loans" as defined in the Secured Credit Agreement are repaid in full;
(b) no Default shall then exist or shall occur as a result of such
Borrowing;
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(c) the Liquidity Termination Date has not occurred;
(d) the representations and warranties of the Borrower in Section
6.1 and in the other Credit Documents, and of Transocean in Sections 2.1,
2.2 and 2.3 of the Transocean Performance Guaranty, are true and correct in
all material respects on and as of such date (except to the extent that any
of such representations or warranties are not true and correct as a result
of transactions expressly permitted hereunder, under the Transocean
Contracts Loan Agreement or under the Secured Credit Agreement and except
to the extent such representations and warranties relate solely to an
earlier date in which case it shall have been true and correct in all
material respects as of such earlier date); and
(e) each of the Borrower and Transocean is in full compliance with
its covenants and agreements in the Credit Documents (including all
covenants and agreements in Article VII and the limitations on each
Lender's Principal Amount, the Aggregate Principal Amount, and the Matured
Aggregate Loan Amount set forth in Section 2.1(a)).
Nothing in this Article V limits the obligations (including those in Section
3.1) of each Committed Lender to Amsterdam.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.1. Representations and Warranties. The Borrower
represents and warrants to each Lender and the Agent that, except to the extent
that any of the following is not true and correct as a result of transactions
expressly permitted under the Secured Credit Agreement, each of the following
statements is true and correct in all material respects:
(a) Corporate Organization. The Borrower (i) is a duly organized and
existing corporation in good standing under the laws of the State of Delaware;
(ii) has all necessary corporate power to construct, own and operate each of the
Drillship and the Rig and to carry on its business contemplated in connection
therewith; and (iii) is duly licensed or qualified and in good standing in each
jurisdiction in which the nature of the business transacted by it or the nature
of the property owned or leased by it makes such licensing or qualification
necessary.
(b) Corporate Power and Authority; Validity. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and to consummate the
transactions contemplated hereby and has taken all necessary corporate action to
authorize the execution, delivery and performance of such Credit Documents and
to consummate the transactions contemplated hereby. Each Credit Party has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Credit Party enforceable against it in accordance with its terms, subject as to
enforcement only to bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally and
equitable principles.
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(c) No Violation. Neither the execution, delivery or performance by any
Credit Party of the Credit Documents to which it is a party nor compliance by it
with the terms and provisions thereof, nor the consummation by it of the
transactions contemplated herein or therein, will (i) assuming the timely
obtaining and making of all necessary permits, licenses, consents, approvals and
other authorizations of, and filings with, governmental authorities, contravene
in any material respect any applicable provision of any law, statute, rule or
regulation, or any applicable order, writ, injunction or decree of any court or
governmental instrumentality, including, without limitation, all applicable laws
with respect to the location of the Drillship and the Rig, (ii) conflict with or
result in any breach of any term, covenant, condition or other provision of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien other than any Permitted Lien upon any
of the property or assets of any Credit Party under, the terms of any material
contractual obligation to which any Credit Party is a party or by which any of
them or any of their properties or assets is bound or to which any of them may
be subject, or (iii) violate or conflict with any provision of the certificate
of incorporation or by-laws of any Credit Party.
(d) Litigation. There are no actions, suits, proceedings or counterclaims
(including, without limitation, arbitration, derivative or injunctive actions)
pending or, to the knowledge of the Borrower, threatened against the Borrower
that are reasonably likely to have a Material Adverse Effect.
(e) Use of Proceeds; Margin Regulations. (i) The proceeds of the Loans
shall only be used to repay the Construction Loans and accrued and unpaid
interest thereon.
(ii) The Borrower is not engaged in the business of extending credit
for the purpose of purchasing or carrying margin stock. No proceeds of any
Loan will be used for a purpose which violates Regulation U or X of the
Board of Governors of the Federal Reserve System. After application of the
proceeds of any of the Borrowings, none of the assets of the Borrower
consists of "margin stock" (as defined in Regulation U of the Board of
Governors of the Federal Reserve System).
(f) Investment Company Act. The Borrower is not an "investment company"
or a company "controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
(g) Public Utility Holding Company Act. The Borrower is not a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding company," within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
(h) True and Complete Disclosure. All factual information (taken as a
whole) furnished by the Borrower and Transocean in writing to the Agent or any
Lender in connection with any Credit Document or any transaction contemplated
therein is, disregarding any updated, corrected, supplemented, superseded or
otherwise modified information except as so updated, corrected, supplemented,
superseded or otherwise modified, and all other such factual information
hereafter furnished by any such Persons in writing to the Agent or any Lender in
connection herewith, or
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with any of the other Credit Documents or the Loans, will be, on the date of
such information, true and accurate in all material respects and not incomplete
by omitting to state any material fact necessary to make such information (taken
as a whole) not misleading at such time in light of the circumstances under
which such information was provided.
(i) No Material Adverse Change. There has occurred no event or effect,
other than any event specifically permitted, contemplated or provided for under
any Credit Document, that has had or is reasonably likely to have a Material
Adverse Effect.
(j) Labor Controversies. There are no labor controversies pending or, to
the best knowledge of the Borrower, threatened against the Borrower that are
reasonably likely to have a Material Adverse Effect.
(k) Taxes. The Borrower has filed, if any, all United States federal
income tax returns, and all other material tax returns required to be filed,
whether in the United States or in any foreign jurisdiction, and has paid, if
any, all governmental taxes, rates, assessments, fees, charges and levies
(collectively, "Taxes") shown to be due and payable on such returns or on any
assessments made against Borrower or any of its properties (other than any such
assessments which can thereafter be paid without penalty or which are being
contested in good faith by appropriate proceedings and for which reserves have
been provided in conformity with GAAP).
(l) ERISA. With respect to each Plan, the Borrower has fulfilled, if any,
its obligations under the minimum funding standards of, and is in compliance in
all material respects with, ERISA and the Code to the extent applicable to it,
and has not incurred any liability under Title IV of ERISA to the PBGC or a Plan
other than a liability to the PBGC for premiums under Section 4007 of ERISA, in
each case with such exceptions as are not reasonably likely to have a Material
Adverse Effect. As of the Effective Date, the Borrower has no contingent
liabilities with respect to any post-retirement benefits under a welfare plan
subject to ERISA.
(m) Security Interests. Each of the Security Documents creates in favor
of the Collateral Agent for the benefit of (without limitation) the Lenders and
the Swap Parties as security for (without limitation) the Obligations a valid
and enforceable perfected (to the extent that perfection may be achieved by the
filing of proper financing statements (or similar instruments in foreign
jurisdictions), the Security Documents and/or other customary documents in the
appropriate jurisdictions) first priority (subject only to Permitted Liens)
security interest in and Lien on all of the Collateral described therein,
subject to no other Liens except Permitted Liens.
(n) Consents. At the time of consummation thereof, all consents and
approvals of, and filings and registrations with, and all other actions of, all
governmental agencies, authorities or instrumentalities required to have been
obtained or made by the Borrower prior to such time in order to consummate the
Borrowings hereunder, and to execute, deliver and perform the Credit Documents,
have been or will have been obtained or made and are or will be in full force
and effect.
(o) Intellectual Property. The Borrower owns or holds valid licenses to
use (or will, at the time required, own or hold valid licenses to use) all the
material patents, trademarks, permits,
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service marks, and trade names that are necessary to the operation of the
business of the Borrower with such exceptions which are not reasonably likely to
have a Material Adverse Effect.
(p) Ownership of Property. The Borrower owns the Rig and the Drillship,
in each case subject to no Liens except Permitted Liens.
(q) Compliance with Statutes, Etc. The Borrower is in compliance with all
applicable statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic and foreign, including, without
limitation, all applicable laws with respect to the location of the Drillship
and the location of the Rig, in respect of the conduct of its business as
currently conducted by it and the ownership and operation of its properties as
currently operated by it, except for such instances of non-compliance as are not
reasonably and likely to, individually or in the aggregate, have a Material
Adverse Effect, and has all necessary permits and licenses, and other necessary
authorizations, with respect thereto with such exceptions (if any) as are not
reasonably likely to, individually or in the aggregate, have a Material Adverse
Effect.
(r) Environmental Matters. Except as disclosed in Schedule 6.1(r), the
Borrower is in compliance with all applicable Environmental Laws and the
requirements of any permits issued under such Environmental Laws, except for
such instances of non-compliance (if any) as are not reasonably likely to have a
Material Adverse Effect. To the best knowledge of the Borrower, there are no
pending, past or threatened Environmental Claims against the Borrower on any
property owned or operated by the Borrower except as disclosed in Schedule
6.1(r) or except as are not reasonably likely to have a Material Adverse Effect.
To the best knowledge of the Borrower, there are no conditions or occurrences on
any property owned or operated by the Borrower or on any property adjoining or
in the vicinity of any such property that are reasonably likely to form the
basis of an Environmental Claim against the Borrower or any such property that
individually or in the aggregate are reasonably likely to have a Material
Adverse Effect. To the best of the Borrower's knowledge, (i) Hazardous
Materials have not at any time been generated, used, treated or stored on, or
transported to or from, any property owned or operated by the Borrower in a
manner that has violated or could reasonably be expected to violate any
Environmental Law, and (ii) Hazardous Materials have not at any time been
released on or from any property owned or operated by the Borrower, in the case
of both (i) and (ii), with such exceptions as are not reasonably likely to have
a Material Adverse Effect.
(s) Existing Indebtedness. The Borrower has no existing Indebtedness
outstanding as of the Effective Date other than the Obligations hereunder and
other Permitted Indebtedness.
(t) Year 2000. The Borrower has reviewed the areas within its business
and operations which could reasonably be expected to be materially and adversely
affected by, and Transocean has developed or is developing a program to address
on a timely basis, the "Year 2000 Problem" (that is, the risk that computer
applications used by Transocean and the Borrower may be unable to recognize and
perform properly date-sensitive functions involving certain dates prior to and
any date on or after December 31, 1999), has made or is making related inquiry
of material suppliers and vendors, and based on such review and program, the
Borrower believes that the
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"Year 2000 Problem" will not have a Material Adverse Effect. The foregoing
statement constitutes "year 2000 readiness disclosure" as such term in defined
is the Year 2000 Information and Readiness Disclosure Act.
ARTICLE VII
COVENANTS
Section 7.1. Covenants of the Borrower. The Borrower hereby
covenants and agrees that, so long as any Commitment is outstanding hereunder or
any other Obligation is due and payable hereunder:
(a) Corporate Existence. The Borrower will preserve and maintain its
corporate existence. The Borrower shall not form any subsidiaries or enter into
any partnerships, joint ventures or any other business combinations.
(b) Maintenance of Drillship and Rig. Subject to the terms, conditions,
restrictions and limitations set forth in the Operative Documents, the Borrower
shall take, or shall cause to be taken, all actions necessary for the
performance and satisfaction of all of its obligations under the Operative
Documents, including:
(i) enforcing, or causing to be enforced, performance by the
builders of the Drillship and the Rig and each other party to any
construction contract with the Borrower and/or Transocean with respect to
the construction of the Drillship and the upgrade of the Rig of their
respective warranties and other construction obligations with respect to
the design, engineering and construction thereof and pursuing remedies with
respect to the breach of any of these obligations;
(ii) obtaining and maintaining all material permits, licenses,
consents, approvals and other authorizations, including those required
under all applicable laws, from all governmental authorities necessary to
be obtained by it in connection with the operation and maintenance of the
Drillship and the Rig as required by the Amoco Contracts, the Transocean
Contracts or the Substitute Contracts, as applicable;
(iii) operating and maintaining the Drillship and the Rig in
accordance with the requirements of the Amoco Contracts, the Transocean
Contracts or the Substitute Contracts, as applicable; and
(iv) maintaining all books and records with respect to the operation
and maintenance of the Drillship and the Rig as required by the Amoco
Contracts, the Transocean Contracts or the Substitute Contracts, as
applicable;
all of the foregoing subject to such exceptions as are not reasonably likely,
individually or in the aggregate, to have a Material Adverse Effect; provided
that this Section 7.1(b) shall not require the Borrower to perform any
obligation under any contract to which it is a party if it shall be contesting
such obligation in good faith and if reserves in conformity with GAAP have been
provided therefor. The Borrower will, in all material respects, maintain each
of the Drillship and
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the Rig in as good an operating condition as at the date of the Amoco Letter of
Acceptance (ordinary wear and tear excepted), in compliance with all applicable
laws and regulations regarding maintenance and operation and in accordance with
manufacturer's warranties and recommended maintenance procedures, if any. In no
event shall the Drillship or the Rig be maintained or serviced in all material
respects to a lesser standard of maintenance than employed by Transocean or its
Affiliates for similar drillships or rigs, as the case may be, owned or leased
by it in similar locations or jurisdictions.
(c) Taxes. The Borrower will duly pay and discharge all Taxes upon or
against it or its properties before penalties accrue thereon, unless and to the
extent that the same is being contested in good faith and by appropriate
proceedings and reserves have been established in conformity with GAAP.
(d) ERISA. The Borrower will timely pay and discharge all obligations and
liabilities arising under ERISA or otherwise with respect to each Plan of a
character which if unpaid or unperformed might result in the imposition of a
material Lien against any properties or assets of the Borrower and will promptly
notify the Agent upon an officer of the Borrower becoming aware thereof, of (i)
the occurrence of any reportable event (as defined in ERISA) relating to a Plan,
other than any such event with respect to which the PBGC has waived notice by
regulation; (ii) receipt of any notice from PBGC of its intention to seek
termination of any Plan or appointment of a trustee therefor; (iii) the
Borrower's intention to terminate or withdraw from any Plan if such termination
or withdrawal would result in liability under Title IV of ERISA; and (iv) the
receipt by the Borrower of notice of the occurrence of any event that is
reasonably likely to result in the incurrence of any liability (other than for
benefits), fine or penalty to the Borrower that would be material to the
Borrower or any Plan amendment that is reasonably likely to materially increase
the contingent liability of the Borrower in connection with any post-retirement
benefit under a welfare plan subject to ERISA.
(e) Burdensome Restrictions, Etc. Promptly upon any officer of the
Borrower becoming aware thereof, the Borrower shall give to the Agent written
notice of (i) the adoption of any new requirement of law which is reasonably
likely to have a Material Adverse Effect, and (ii) the existence or occurrence
of any strike, slow down or work stoppage which is reasonably likely to have a
Material Adverse Effect.
(f) Insurance. (i) Types of Insurance Required. The Borrower shall
maintain, or cause to be maintained, with reputable insurance companies
reasonably acceptable to the Agent, the types of insurance required to be
maintained by it under the Amoco Contracts, the Transocean Contracts or the
Substitute Contracts, as applicable, in at least the amounts required thereunder
and, at a minimum, the following types of insurance in at least the following
amounts:
(1) Workmen's Compensation and Employer's Liability insurance which
shall fully comply with the laws of the State of Louisiana (and such other
states, countries or jurisdictions where the Borrower shall operate), such
policy to contain the following endorsements covering:
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(x) United States Longshoremen's and Harbor Workers'
Compensation Act;
(y) Employer's Liability covering marine operations with
minimum limits of liability of $1,000,000 for deaths or injuries
arising out of one occurrence; and
(z) United States Longshoremen's and Harbor Workers'
Compensation Act as applicable to the Outer Continental Shelf Lands
Act (if applicable).
(2) Comprehensive General Liability or Commercial General Liability
(or equivalent coverage) insurance including Contractual Liability and
suitably endorsed to cover maritime operations with minimum limits of
$1,000,000 per occurrence for deaths or injuries and property damage
arising out of one accident (if this contract is governed by the laws of
the State of Texas, the minimum limits for contractual liability insurance
shall be no less than $500,000).
(3) Automobile Public Liability and Property Damage insurance with a
minimum limit of $1,000,000 for injury or death of one person, $1,000,000
for injuries or deaths arising out of one accident and $1,000,000 property
damage arising out of one accident.
(4) Vessel Insurance: The Drillship and the Rig, and any other
vessels owned, chartered or operated in performance of any operations of
the Borrower, shall be covered with (x) P&I Insurance (on SP23 Form or
equivalent) including crew, which may be part of Transocean's policy, in
amounts equal to the greater of the coverage afforded under Transocean's
policy as in effect from time to time and the amount that would be obtained
by reasonably prudent operators of the general expertise of Transocean
owning and operating vessels such as the Drillship and Rig and (y) hull
insurance (on a current American Institute or equivalent hull form),
including wreck removal coverage (legal, contractual and voluntary) and
full collision coverage (floating and stationary). The hull policy with
respect to the Drillship shall have a minimum limit of not less than the
book value of such vessel based upon a 30 year straight line amortization
and the hull policy with respect to the Rig shall have a minimum limit of
an amount to be agreed by the Agent and the Borrower as of the Effective
Date and each anniversary thereafter based upon the remaining Vessel
Amortization Payments and "Vessel Amortization Payments" under the
Transocean Contracts Loan Agreement for the Rig.
(5) Mortgagee's Interest/Breach of Warranty Insurance (on a current
London Institute mortgagees interest clause - hulls form) on each of the
Drillship and the Rig in a minimum limit of not less than $250,000,000 for
the Drillship and in an amount to be agreed by the Agent and the Borrower
for the Rig as of the Effective Date and each anniversary thereafter based
upon the remaining Vessel Amortization Payments, and the remaining "Vessel
Amortization Payments" under the Transocean Contracts Loan
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Agreement, for the Rig. Such insurance may be obtained through an
endorsement to the required hull insurance.
(6) Umbrella or Excess Liability insurance with a limit of at least
$50,000,000, following the form of all underlying liability policies.
(7) If the Drillship or the Rig shall at any time be located in war-
endangered waters or in other waters which may under the hull policy be
considered excluded by any "free of capture and seizure" clause, the
Borrower shall give prompt prior written notice thereof to the Agent, and
at the request of the Agent shall insure (through a separate policy or by
endorsement to the applicable hull policy) such vessel against war and
political risks in the amount required to be maintained under the hull
policy with respect thereto.
No deductible under any of such policies shall exceed $250,000, unless such
deductible amount under any such policy shall become unavailable on commercially
reasonable terms. The Borrower shall not self-insure any of such risks. The
hull policies (including any war and political risk coverage) shall each name
the Collateral Agent as a named assured and a loss payee (provided that the
Collateral Agent need not be named as a loss payee with respect to any "xxx and
labor" coverage), the liability insurance policies required herein shall name
the Collateral Agent as a named assured and the mortgagee's interest/breach of
warranty policy or endorsement shall name only the Collateral Agent as a named
assured and loss payee. Each of such policies shall be reasonably acceptable to
the Agent and shall provide that the Collateral Agent shall have no
responsibility for payment of premium and that it shall not terminate without at
least thirty (30) days' (or such fewer days, if any, in the case of cancellation
pursuant to any war and related risk termination clauses contained in such
policies) advance written notice to the Collateral Agent.
(ii) Loss of Hire. From and after the Funding Date and during the term of
the Amoco Contract or any Substitute Contract with respect to the Drillship and
the Rig, respectively, the Borrower shall maintain loss of hire insurance for a
period of at least eighteen (18) months (or, if less, for the then remaining
scheduled term of such Amoco Contract or Substitute Contract, as the case may
be) and in an amount equal to at least $137,000 (reduced by the amount of any
reduction in the stated operating dayrate to be paid by Amoco under the Amoco
Drillship Contract to the extent the Borrower, as a result of such reduction, is
required to make a prepayment of the Loans pursuant to Section 2.5(g)) per day
with respect to the Drillship and $68,600 (or $50,000, if the operating dayrate
is reduced to $75,000 per day pursuant to the terms of the Amoco Rig Contract)
per day with respect to the Rig for such period (subject to a maximum ninety
(90) day deductible). If the Borrower shall make a mandatory prepayment of the
remaining Vessel Amortization Payments for either the Drillship or the Rig as
provided in Section 2.5(a) or (b), as applicable, together with all other
amounts required to be paid therein, the Borrower shall no longer be required to
maintain loss of hire insurance with respect to the affected vessel. Such loss
of hire policy shall be reasonably acceptable to the Agent, shall name the
Collateral Agent as a named assured and a loss payee and shall provide it shall
not terminate without at least thirty (30) days' advance written notice to the
Collateral Agent.
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(iii) Insurance Reserve. On the Funding Date, the Borrower shall
establish (but not then be required to fund) a single insurance reserve account
with the Collateral Agent for both this Agreement and the Transocean Contracts
Loan Agreement (the "Insurance Reserve"). As used herein, the term "Insurance
Reserve Required Amount" shall mean, at any date of computation, an amount equal
to the aggregate of $137,000 (reduced by the amount of any reduction in the
stated operating dayrate to be paid by Amoco under the Amoco Drillship Contract
to the extent the Borrower, as a result of such reduction, is required to make a
prepayment of the Loans pursuant to Section 2.5(g)) with respect to the
Drillship and $68,600 (or $50,000, if the operating dayrate is reduced to
$75,000 per day pursuant to the terms of the Amoco Rig Contract) with respect to
the Rig times the number of days in the period of any deductible under the
applicable loss of hire policy or policies maintained by the Borrower pursuant
to Section 7.1(f)(ii), subject to the reduction as set forth herein. If the
Borrower shall make a mandatory prepayment of the remaining Vessel Amortization
Payments for either the Drillship or the Rig as provided in Section 2.5(a) or
(b), as applicable, together with all other amounts required to be paid therein,
the Insurance Reserve Required Amount shall permanently be reduced by a
percentage, the numerator of which is the product of (i) either $137,000
(reduced by the amount of any reduction in the stated operating dayrate to be
paid by Amoco under the Amoco Drillship Contract to the extent the Borrower, as
a result of such reduction, is required to make a prepayment of the Loans
pursuant to Section 2.5(g)) with respect to the Drillship or $68,600 (or
$50,000, if the operating dayrate is reduced to $75,000 per day pursuant to the
terms of the Amoco Rig Contract) with respect to the Rig, whichever is
applicable, times (ii) the number of days in the period of any deductible under
the loss of hire policy then in effect for the applicable vessel, and the
denominator of which is the Insurance Reserve Required Amount immediately in
effect before such prepayment (the "Vessel Percentage"). If a loss of hire
event of a nature covered by the loss of hire insurance policy or policies
maintained pursuant to Section 7.1(f)(ii) shall occur with respect to the
Drillship or the Rig during the term of the Amoco Contract or any Substitute
Contract for the applicable vessel, the Borrower shall deposit (or cause to be
deposited) into the Insurance Reserve, as and when necessary for the Borrower to
be able to pay timely and in full its Obligations and the Transocean Contracts
Obligations becoming due and payable, an aggregate amount equal to the amount of
loss of hire insurance proceeds foregone with respect to such loss of hire event
as a result of any deductible under the loss of hire insurance policy then in
effect, provided that the Borrower shall not be obligated to make any deposit
into the Insurance Reserve (pursuant to any provision of this Section
7.1(f)(iii) or any comparable provision of the Transocean Contracts Loan
Agreement) to the extent that, after giving effect to such deposit, the
aggregate amount theretofore at any time deposited by or on behalf of the
Borrower into the Insurance Reserve (pursuant to any provision of this Section
7.1(f)(iii) or any comparable provision of the Transocean Contracts Loan
Agreement) would exceed an amount equal to the Insurance Reserve Required Amount
then in effect less the aggregate amount of any prior deposits (pursuant to any
provision of this Section 7.1(f)(iii) or any comparable provision of the
Transocean Contracts Loan Agreement) into the Insurance Reserve to the extent
not repaid by the Borrower to Transocean pursuant to the terms and conditions
hereof or (without duplication) recouped out of Excess Cash Flow pursuant to the
last sentence of the definition thereof. The Borrower shall thereafter use (and
the Collateral Agent shall make available to the Borrower) the funds in the
Insurance Reserve and then the loss of hire insurance proceeds to pay its
Obligations, its Transocean Contracts Obligations and/or its Swap Obligations as
they become due under the relevant documents. The Borrower (or Transocean on
behalf of the Borrower) also
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in its discretion may make deposits into the Insurance Reserve from time to time
(and such deposits shall constitute funding or replenishment of the Insurance
Reserve for purposes of the last sentence of the definition of the term "Excess
Cash Flow"). If an Event of Loss or a Casualty Loss shall occur, the Borrower
shall fund the Insurance Reserve as set forth in the third preceding sentence,
and shall thereafter use (and the Collateral Agent shall make available to the
Borrower) the funds in the Insurance Reserve, as necessary, to pay its
Obligations, its Transocean Contracts Obligations and/or its Swap Obligations as
they become due under the relevant documents. If the amount of funds in the
Insurance Reserve shall at any time exceed the Insurance Reserve Required Amount
for any reason (such as, for example, the lowering of the deductible under the
loss of hire insurance policies), the Collateral Agent shall upon request of the
Borrower release the excess amount to the Borrower. The Collateral Agent shall
invest and reinvest the amounts in the Insurance Reserve in such Cash
Equivalents as the Borrower may specify from time to time, and shall liquidate
such investments as it may be directed from time to time by the Borrower (unless
an Event of Default shall have occurred and be continuing hereunder, in which
event the Borrower hereby authorizes the Collateral Agent to liquidate any such
investments in its sole discretion without any further direction or
authorization from the Borrower), and all such investments shall be deemed to
constitute part of the Insurance Reserve for all purposes of this Agreement. On
the Collateral Termination Date, all amounts in the Insurance Reserve shall be
released to the Borrower.
(iv) Insurance Certificate. The Borrower will (i) on or before March 31st
of each calendar year and (ii) on the request of the Agent, furnish to the Agent
a certificate from a Senior Officer of the Borrower setting forth the nature and
extent of the insurance and the amount of the Insurance Reserve maintained
pursuant to this Section 7.1(f).
(g) Financial Reports and Other Information. (i) The Borrower will
maintain a system of accounting in such manner as will enable preparation of
financial statements in accordance with GAAP and will furnish to the Lenders and
their respective authorized representatives such information about the business
and financial condition of the Borrower as any Lender may reasonably request;
and, without any request, will furnish to the Agent:
(x) within sixty (60) days after the end of each of the first three
(3) fiscal quarters of each fiscal year of the Borrower, the balance sheet
of the Borrower as at the end of such fiscal quarter and the related
statements of income and retained earnings and of cash flows for such
fiscal quarter and for the portion of the fiscal year ended with the last
day of such fiscal quarter, all of which shall be in reasonable detail and
certified by the chief financial officer of the Borrower that they fairly
present the financial condition of the Borrower and as of the dates
indicated and the results of its operations and changes in its cash flows
for the periods indicated and that they have been prepared in accordance
with GAAP, in each case, subject to normal year-end audit adjustments and
the omission of footnotes;
(y) within one hundred twenty (120) days after the end of each
fiscal year of the Borrower, the balance sheet of the Borrower as at the
end of such fiscal year and the related statements of income and retained
earnings and of cash flows for such fiscal year and setting forth
consolidated comparative figures as of the end of and for the preceding
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fiscal year, audited (in the case of each full calendar year from and after
the Funding Date) by an independent nationally-recognized accounting firm;
and
(z) on each Amortization Date, a written certificate (the "Monthly
Report") signed by the Borrower's chief financial officer (or other
financial officer of the Borrower), in his or her capacity as such, (i)
showing in reasonable detail the Excess Cash Flow calculation for the
preceding calendar month and (ii) showing in reasonable detail the
calculation of the Borrowing Base as of the date of such certificate.
The Agent will forward promptly to the Lenders the information provided by the
Borrower pursuant to (x), (y) and (z) above.
(ii) Each financial statement furnished to the Agent pursuant to
subsections (x) and (y) of Section 7.1(g)(i) shall be accompanied by a
written certificate signed by the Borrower's chief financial officer (or
other financial officer of the Borrower), in his or her capacity as such,
(i) to the effect that no Default then exists or, if any such Default
exists as of the date of such certificate, setting forth a description of
such Default and specifying the action, if any, taken by the Borrower to
remedy the same, (ii) stating the then outstanding principal amount, if
any, of any loan or advance from Transocean to the Borrower to fund the
Cash Flow Reserve or the Insurance Reserve and the remaining obligation of
Transocean to fund each of the Cash Flow Reserve and the Insurance Reserve,
and (iii) stating that the Year 2000 remediation efforts of the Borrower
are proceeding as scheduled.
(iii) Promptly upon receipt thereof, the Borrower will provide the
Agent with a copy of each report or "management letter" submitted to the
Borrower by its independent accountants or auditors in connection with any
annual, interim or special audit made by them of the books and records of
the Borrower and each "management letter" submitted to the Borrower by its
independent accountants or auditors and any report by any regulator
regarding the Year 2000 exposure, program or progress of Transocean and its
Subsidiaries;
(iv) Promptly after any officer of the Borrower obtains knowledge of
any of the following, the Borrower will provide the Agent with written
notice in reasonable detail of:
(x) any pending or threatened material Environmental Claim
against the Borrower or any property owned or operated by the
Borrower;
(y) any condition or occurrence on any property owned or
operated by the Borrower that results in material noncompliance by the
Borrower with any Environmental Law; and
(z) the taking of any material remedial action in response to
the actual or alleged presence of any Hazardous Material on any
property owned or operated by the Borrower other than in the ordinary
course of business.
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(v) The Borrower will promptly, and in any event within five (5)
days, after a Senior Officer has knowledge thereof, give written notice to
the Agent of (who will in turn provide notice to the Lenders of): (i) the
occurrence of any Default; (ii) any litigation or governmental proceeding
of the type described in Section 6.1(d); (iii) any circumstance that has
had or reasonably threatens a Material Adverse Effect, including, without
limitation, the revocation, change, modification or reconsideration of any
license, consent or approval which has had or reasonably threatens a
Material Adverse Effect; (iv) the downgrading, withdrawal or suspension of
any rating by any Rating Agency of any indebtedness of Amoco; (v) any
investigation of the Drillship or the Rig for a violation of applicable
law; or (vi) any assignment by Amoco, or any assignee of Amoco, of its
rights and obligations under either the Amoco Drillship Contract or the
Amoco Rig Contract.
If the Agent receives such a notice, the Agent shall promptly give notice
thereof to each Lender and, until Amsterdam has no Loans outstanding after the
Amsterdam Termination Date, to each CP Dealer and each Rating Agency.
(h) Lender Inspection Rights. Upon reasonable notice from the Agent or
any Lender, the Borrower will permit the Agent or any Lender (and such Persons
as the Agent or such Lender may reasonably designate) during normal business
hours at such entity's sole expense unless a Default shall have occurred and be
continuing, in which event at the Borrower's expense, to visit and inspect any
of the properties of the Borrower, to examine all of its books and records, to
make copies and extracts therefrom, and to discuss its affairs, finances and
accounts with its officers and independent public accountants (and by this
provision the Borrower authorizes such accountants to discuss with the Agent and
any Lender (and such Persons as the Agent or such Lender may reasonably
designate) the affairs, finances and accounts of the Borrower), all as often,
and to such extent, as may be reasonably requested. The chief financial officer
of the Borrower and/or his or her designee shall be afforded the opportunity to
be present at any meeting of the Agent or the Lenders and such accountants. The
Agent agrees to use reasonable efforts to minimize, to the extent practicable,
the number of separate requests from the Lenders to exercise their rights under
this Section 7.1(h) and/or Section 7.1(g) and to coordinate the exercise by the
Lenders of such rights.
(i) Conduct of Business. The Borrower will not engage in any line of
business other than the construction, ownership and operation of the Drillship
and the Rig.
(j) Interest Rate Protection. The Borrower will maintain its outstanding
Interest Rate Protection Agreements (and/or other Interest Rate Protection
Agreements providing the same interest protection) in effect for the term of the
applicable Loans hereunder. If an Event of Default shall have occurred and be
continuing and the Instructing Group shall have elected to take action with
respect thereto (unless not required hereunder because of an insolvency event),
the Borrower shall effect a "true-up" of the financial terms of the Interest
Rate Protection Agreement or Agreements in effect at such time to the extent
necessary to eliminate any over-hedged position at such time as a result of any
prior optional or mandatory prepayment of the Obligations. If the Agent or a
Lender is the counterparty to an Interest Rate Protection
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Agreement, any obligations of the Borrower thereunder shall be secured pari
passu by the Collateral.
(k) Limitation on Dividends; Negative Pledges. The Borrower will not pay
any dividends or make any other distributions on its capital stock so long as a
Default shall have occurred and be continuing, and it shall only make dividends
or distributions on its capital stock out of (i) its portion of Excess Cash
Flow, (ii) any excess Event of Loss Proceeds, Casualty Proceeds or loss of hire
insurance proceeds after compliance in full with Sections 2.5(a), 7.1(f) and
7.1(j) as applicable, (iii) the amount of the stated operating dayrate (express
or implicit) in any Substitute Contract paid to the Borrower above the stated
dayrate (express or implicit) in the Transocean Contract for the applicable
vessel but below the stated operating dayrate in the Amoco Rig Contract in
effect on the Funding Date with respect to the Rig or below $181,000 with
respect to the Drillship or (iv) in the event that any optional prepayments of
the Loans are made, out of any other funds (provided that dividends pursuant to
this clause (iv) shall not exceed in the aggregate the aggregate amount of all
such optional prepayments) (all such permitted sources, the "Permitted
Distribution Sources"). The Borrower may not redeem, purchase or otherwise
acquire any shares of its capital stock or make any deposit for such purpose.
The Borrower shall not enter into any agreement (other than the Operative
Documents) expressly and directly prohibiting the creation or assumption of any
Lien upon its properties, revenues or assets, whether now owned or hereafter
acquired, or prohibiting or restricting the ability of the Borrower from
amending or otherwise modifying any Credit Document, except that the Borrower
(x) may do so (l) in connection with the incurrence or assumption of any
Indebtedness permitted to exist pursuant to Section 7.1(o)(other than, subject
to clause (y) below, Section 7.1(o)(iv)), or (2) with respect to any particular
property or asset (or the revenues associated therewith), in connection with any
permitted transaction involving such property or asset (including, without
limitation, prohibitions in agreements on the assignment or granting of a Lien
thereon) and (y) may enter into any agreement with Transocean prohibiting or
restricting the ability of the Borrower from amending or otherwise modifying
this Agreement or any other Credit Documents.
(l) Restrictions on Fundamental Changes. The Borrower shall not be a
party to any merger into or consolidation with, or purchase or otherwise acquire
all or substantially all of the assets or any of the stock of, any other Person,
or (subject to Section 2.5(e)) sell the Drillship or the Rig or any of its stock
unless any such merger or consolidation is with Transocean or any such sale is
to Transocean and Transocean assumes the Borrower's Obligations hereunder, and
Transocean delivers to the Agent a legal opinion in form and substance
satisfactory to the Agent with respect to such merger, consolidation or sale.
(m) Cash Flow Reserve. On the Funding Date, the Borrower shall establish
(but not then be required to fund) a single cash flow reserve account with the
Collateral Agent for both this Agreement and the Transocean Contracts Loan
Agreement (the "Cash Flow Reserve"). As used herein, the term "Cash Flow
Reserve Required Amount" shall mean (i) $20,630,000 during the ninety (90) day
period immediately following the Funding Date, and (ii) $8,300,000 thereafter,
in each case subject to reduction as set forth herein; provided, however, that
for purposes of the calculation in the proviso to the next sentence, any amounts
deposited by the Borrower into the Cash Flow Reserve up to $12,330,000 in the
aggregate during the period that
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the Cash Flow Reserve Amount is $20,630,000 shall not be counted as having been
previously so deposited once the Cash Flow Reserve Amount is reset to
$8,300,000. If the Borrower shall be unable for any reason to pay timely and in
full any of its Obligations or Transocean Contracts Obligations becoming due and
payable, the Borrower shall deposit (or cause to be deposited) into the Cash
Flow Reserve the incremental amount necessary for Borrower to be able to pay
timely and in full such Obligations and Transocean Contracts Obligations
becoming due and payable, provided that the Borrower shall not be obligated to
make any deposit into the Cash Flow Reserve (pursuant to any provision of this
Section 7.1(m) or any comparable provision of the Transocean Contracts Loan
Agreement), to the extent that, after giving effect to such deposit, the
aggregate amount theretofore at any time deposited by or on behalf of the
Borrower into the Cash Flow Reserve (pursuant to any provision of this Section
7.1(m) or any comparable provision of the Transocean Contracts Loan Agreement)
would exceed an amount equal to the Cash Flow Reserve Required Amount then in
effect less the aggregate amount of any prior deposits into the Cash Flow
Reserve (pursuant to any provision of this Section 7.1(m) or any comparable
provision of the Transocean Contracts Loan Agreement), to the extent not repaid
by the Borrower to Transocean pursuant to the terms and conditions hereof or
(without duplication) recouped by the Borrower pursuant to the last sentence of
the definition of the term "Excess Cash Flow." The Borrower shall use (and the
Collateral Agent shall make available to the Borrower) the funds in the Cash
Flow Reserve to pay its Obligations, its Transocean Contracts Obligations and/or
its Swap Obligations as they become due under the relevant documents, provided
that the funds in the Insurance Reserve shall first be used by the Borrower if a
loss of hire event, an Event of Loss or a Casualty Event shall have occurred.
The Borrower also may in its discretion fund or replenish the Cash Flow Reserve
from time to time from any source of funds to any extent (and such deposits
shall constitute funding or replenishment of the Cash Flow Reserve for purposes
of the last sentence of the definition of the term "Excess Cash Flow"). If the
Borrower shall elect a Vessel Financing Termination or if an Event of Loss shall
occur with respect to either the Drillship or the Rig, and the Borrower shall
make a mandatory prepayment of its Vessel Amortization Payments for the
applicable vessel as provided in Section 2.5(a) or (b), as applicable and its
"Vessel Amortization Payments" for the applicable vessel as provided in the
comparable provisions of the Transocean Contracts Loan Agreement, then the Cash
Flow Reserve Required Amount shall permanently be reduced by the Vessel
Percentage thereof. The Collateral Agent shall invest and reinvest the amounts
in the Cash Flow Reserve in such Cash Equivalents as the Borrower may specify
from time to time, and shall liquidate such investments as it may be directed
from time to time by the Borrower (unless an Event of Default shall have
occurred and be continuing, in which event the Borrower hereby authorizes the
Collateral Agent to liquidate any such investments in its sole discretion
without any further direction or authorization from the Borrower), and all such
investments shall be deemed to constitute part of the Cash Flow Reserve for all
purposes of this Agreement. If the amount of funds in the Cash Flow Reserve
shall at any time exceed the Cash Flow Reserve Required Amount (such as, for
example, as a result of a prepayment of the Loans pursuant to Section 2.5(a) the
Collateral Agent shall upon the request of the Borrower release the excess
amount to the Borrower. On the Collateral Termination Date, all amounts in the
Cash Flow Reserve shall be released to the Borrower.
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(n) Liens. The Borrower shall not create, incur, assume or suffer to
exist any Lien of any kind on any property or asset of any kind of the Borrower,
except the following (collectively, the "Permitted Liens"):
(i) Liens arising in the ordinary course of business by operation of
law, deposits, pledges or other Liens in connection with workers'
compensation, unemployment insurance, old age benefits, social security
obligations, taxes, assessments, public or statutory obligations or other
similar charges, good faith deposits, pledges or other Liens in connection
with (or to obtain letters of credit in connection with) bids, performance,
return-of-money or payment bonds, contracts or leases to which the Borrower
is a party or other deposits required to be made in the ordinary course of
business; provided that in each case the obligation secured is not for
Indebtedness for borrowed money and is not overdue or, if overdue, is being
contested in good faith by appropriate proceedings and reserves in
conformity with GAAP have been provided therefor;
(ii) mechanics', workmen's, materialmen's, landlords', carriers',
maritime or other similar Liens arising in the ordinary course of business
(or deposits to obtain the release of such Liens) related to obligations
not overdue for more than thirty (30) days, or, if so overdue, that are
being contested in good faith by appropriate proceedings and reserves in
conformity with GAAP have been provided therefor;
(iii) Liens for Taxes which are being contested in good faith by
appropriate proceedings and reserves in conformity with GAAP have been
provided therefor;
(iv) Liens imposed by ERISA (or comparable foreign laws) which are
being contested in good faith by appropriate proceedings and reserves in
conformity with GAAP have been provided therefor;
(v) Liens arising out of judgments or awards against the Borrower or
in connection with surety or appeal bonds or the like in connection with
bonding such judgments or awards, the time for appeal from which or
petition for rehearing of which shall not have expired or for which the
Borrower shall be prosecuting an appeal or proceeding for review, and for
which it shall have obtained (within thirty (30) days with respect to a
judgment or award rendered in the United States or within sixty (60) days
with respect to a judgment or award rendered in a foreign jurisdiction
after entry of such judgment or award or expiration of any previous such
stay, as applicable) a stay of execution or the like pending such appeal or
proceeding for review; provided, that the aggregate amount of uninsured or
underinsured liabilities (including interest, costs, fees and penalties, if
any) of the Borrower secured by such Liens shall not exceed $5,000,000 at
any one time outstanding;
(vi) rights reserved to or vested in any municipality or
governmental, statutory or public authority by the terms of any right,
power, franchise, grant, license or permit, or by any provision of law, to
terminate such right, power, franchise, grant, license or permit
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or to purchase, condemn, expropriate or recapture or to designate a
purchaser of any of the property of a Person;
(vii) rights reserved to or vested in any governmental, statutory
or public authority to control, regulate or use any property of a Person;
(viii) Liens arising under Environmental Laws; and
(ix) Liens created by the Operative Documents or the "Operative
Documents" under the Transocean Contracts Loan Agreement.
(o) Indebtedness. The Borrower shall not incur, assume or suffer to exist
any Indebtedness, except the following (collectively, the "Permitted
Indebtedness"):
(i) Indebtedness under the Credit Documents or the Transocean
Contracts Loan Agreement;
(ii) Indebtedness incurred, assumed or existing in connection with
the Liens permitted by Section 7.1(n);
(iii) Interest Rate Protection Agreements as required by Section
7.1(j); and
(iv) unsecured Indebtedness to Transocean or any of its Subsidiaries
so long as (A) payment of such Indebtedness is subordinated to payment of
the Borrower's Obligations hereunder during the continuance of any Default,
no payments of principal, interest or fees on such Indebtedness are
scheduled to be made before the Collateral Termination Date except for (w)
repayments of any amounts paid by Transocean or any of its Subsidiaries in
connection with (1) the design, engineering, construction and equipment of
the Drillship and the acquisition, design, engineering, upgrade and
equipping of the Rig as contemplated by the Amoco Drillship Contract and
the Amoco Rig Contract, respectively, (2) insurance premiums or binder
deposits under the insurance policies required or heretofore required to be
maintained by the Borrower pursuant to any Operative Document or any
"Operative Document" under the Transocean Contracts Loan Agreement, (3) the
Interest Rate Protection Agreements required or heretofore required by
Section 7.1(j) or by Section 6.10 of the Secured Credit Agreement
(including, without limitation, any true-up costs or expenses with respect
thereto) and (4) flagging costs and costs of obtaining certification of the
Drillship and the Rig, (x) repayments of the principal of, and accrued
interest on, any borrowings from Transocean or any of its Subsidiaries to
fund Amoco or any substitute contracting party directed or requested
capital expenditures out of payments therefor by Amoco or any substitute
contracting party in excess of Fixed Operating Expenses, as applicable, (y)
payments out of any Permitted Distribution Sources, or (z) repayments of
the principal of, and accrued interest on, any borrowings from Transocean
or any of its Subsidiaries to fund or replenish the Cash Flow Reserve or
the Insurance Reserve (even if such funding of any such reserve was not at
the time required), out of any incentive or bonus payments under the Amoco
Drillship Contract or any Permitted Distribution Source or any Event of
Loss Proceeds,
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Casualty Proceeds or loss of hire insurance proceeds paid over to the
Borrower pursuant to Section 7.1(f), in each case so long as no Default
shall have occurred and be continuing, and (B) the documentation with
respect to such Indebtedness otherwise is reasonably satisfactory to the
Agent.
(p) Use of Property and Facilities; Environmental Laws. The Borrower
shall comply in all material respects with all Environmental Laws applicable to
or affecting the properties or business operations of the Borrower, where the
failure to comply is reasonably likely to have a Material Adverse Effect.
(q) Advances, Investments and Loans. The Borrower shall not lend money or
make advances to any Person, guaranty any obligations of any Person or purchase
or acquire any stock, indebtedness, obligations or securities of, or any other
interest in, or make any capital contribution to, any other Person (any of the
foregoing, an "Investment") except:
(i) Investments (including, without limitation, of the Cash Flow
Reserve and the Insurance Reserve) in Cash Equivalents and deposit
accounts;
(ii) receivables owing to the Borrower created or acquired in the
ordinary course of business and payable on customary trade terms of the
Borrower;
(iii) Investments received in connection with the bankruptcy or
reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in
the ordinary course of business;
(iv) Interest Rate Protection Agreements entered into in compliance
with Section 7.1(j);
(v) deposits and progress payments made in the ordinary course of
business;
(vi) unsubordinated demand loans to Transocean out of any Permitted
Distribution Sources; and
(vii) temporary Investments of cash not otherwise permitted above
to the extent the same is being held to fund reasonably anticipated working
capital needs, not to exceed the equivalent of $5,000,000 in the aggregate.
(r) Modifications of Corporate Documents and Contracts. (i) The Borrower
shall not amend, modify or change in any way materially adverse to the interests
of the Lenders, its certificate of incorporation, by-laws or other corporate
governance documents.
(ii) The Borrower shall not amend, modify or change in any way any of the
Amoco Contracts, the Transocean Contracts or the Substitute Contracts (except as
specifically contemplated thereby) so as to reduce the length of the term
thereof, change in any respect materially adverse to the interests of the
Lenders any of the time and manner, or reduce the amount of, any of the payments
to be made thereunder by any party thereto other than the
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Borrower, reduce in any respect materially adverse to the interests of the
Lenders any of the insurance required to be maintained thereunder or change in
any respect materially adverse to the interests of the Lenders any of the terms
thereof, in each case, without the consent of the Instructing Group; provided,
however, that (i) the Borrower may amend, modify or change in any way the
Functional Requirements for the Drillship or the Rig with the consent of Amoco
so long as such amendment, modification or change does not materially diminish
the value, useful life or anticipated utility of the applicable vessel and (ii)
the Borrower and Transocean may terminate either or both of the Transocean
Contracts if either (x) the Transocean Contracts Loans, together with all
accrued and unpaid interest thereon and any breakage fees due under the
Transocean Contracts Loan Agreement, shall have been paid in full, or (y) the
Borrower enters into a substitute contract (whether through an extension of
either of the Amoco Contracts or a new contract with Amoco or with another
Person) providing for the lease or employment of the Drillship or the Rig, as
applicable, the anticipated cash flow under which is no less than that under the
relevant Transocean Contract containing collateral assignment provisions no less
favorable to the Borrower than the provisions of the applicable Amoco Contract
and containing non-financial terms and provisions (including, without
limitation, with respect to the operating dayrates, cost reimbursements, the
term, insurance, force majeure and defaults thereunder), that overall are no
less favorable to the Borrower than the non-financial terms and provisions of
the applicable Amoco Contract and otherwise are reasonably satisfactory to the
Agent, with Amoco or with another Person which has an investment grade rating of
at least BBB from S&P and Baa2 from Xxxxx'x and not on credit watch for a
downgrade of such ratings to below either such level, as applicable, and if the
Borrower provides to the Collateral Agent (for the benefit of, without
limitation, the Lenders) a Lien upon the Borrower's interest in any such
Substitute Contract pursuant to an assignment in substantially the form of the
Assignments of Amoco Contracts and obtains the consent of the substitute
contracting party to such assignment in form and substance reasonably
satisfactory to the Agent. Any such Substitute Contract shall be substituted for
the applicable Transocean Contract (i) when it shall have become effective, and
(ii) when it shall have been reasonably accepted by the Agent as a Substitute
Contract in compliance with the criteria contained herein as evidenced by a
consent from the Agent to the Borrower. The Agent shall promptly provide the
Lenders with a copy of any Substitute Rig Contract or Substitute Drillship
Contract and its consent thereto.
(iii) The Borrower shall not, without the consent of the Instructing
Group, amend, modify or supplement, in each case in any way materially adverse
to the interests of the Lenders, the License Agreement or the O&M Contracts.
(iv) The Borrower shall not, after the date hereof, enter into, or amend
or modify, any Operative Document, Substitute Contract or Interest Rate
Protection Agreement without the prior written consent of Transocean.
(s) Transfers of Assets. The Borrower shall not permit any Transfer of an
asset (other than the Rig and related assets in connection with a Vessel
Financing Termination) except:
(i) the Transfer of equipment and other assets in the ordinary
course of business including the repayment of the Loans;
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(ii) the retirement or replacement of assets in the ordinary course
of business;
(iii) any Investment permitted by Section 7.1(q);
(iv) the Liens permitted by Section 7.1(n);
(v) the Transfer of assets that are obsolete, worn out or no longer
useful in the business of the Borrower;
(vi) exchanges of assets that are of a like kind and value;
(vii) any Transfer of the Drillship or the Rig to Transocean
pursuant to Section 7.1(r); and
(viii) any Transfer permitted or effected under the O&M Contracts
or the Transocean Contracts.
(t) Transactions with Affiliates. Except as otherwise specifically
permitted herein, the Borrower shall not enter into or engage in any material
transaction or arrangement or series of related transactions or arrangements
which in the aggregate would be material with any Affiliate, but excluding the
transactions and arrangements contemplated by the Operative Documents and
excluding any tax-sharing agreement between Transocean and the Borrower,
including, without limitation, the purchase from, sale to or exchange of
property with, or the rendering of any service by or for, any Affiliate, except
pursuant to the requirements of the Borrower's business and unless such
transaction or arrangement or series of related transactions or arrangements,
taken as a whole, is fair and equitable to the Borrower.
(u) Compliance with Laws. Without limiting any of the other covenants of
the Borrower in this Article VII, the Borrower shall conduct its business, and
otherwise be, in compliance with all applicable laws, regulations, ordinances
and orders of any governmental or judicial authorities; provided, however, that
this Section 7.1(u) shall not require the Borrower to comply with any such law,
regulation, ordinance or order if (x) it shall be contesting such law,
regulation, ordinance or order in good faith by appropriate proceedings and
reserves in conformity with GAAP have been provided therefor, or (y) the failure
to comply therewith is not reasonably likely to have a Material Adverse Effect.
(v) Bank Accounts. The Borrower shall maintain separate bank accounts
from Transocean and its Subsidiaries.
(w) Notice of Change of Definitions. The Borrower shall give written
notice to the Agent of any change of any of the definitions in the Transocean
Credit Facility that would cause any change in any of the definitions contained
herein within five (5) days of any such change. The Agent shall in turn
promptly provide such notice to the Lenders.
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ARTICLE VIII
EVENTS OF DEFAULT
Section 8.1. Events of Default. Any one or more of the
following shall constitute an Event of Default:
(a) default by the Borrower in the payment of the principal amount of any
Loan, any interest thereon or any fees payable hereunder within two (2) Business
Days following the date when due;
(b) default by the Borrower in the observance or performance of any
covenant set forth in Section 7.1(g)(v)(i) (if the Borrower shall have failed to
give the applicable written notice contemplated by Section 7.1(g)(v)(i) within
five (5) days after a Senior Officer of the Borrower first having knowledge of
the occurrence of any Default), 7.1(k), 7.1(l), 7.1(r) or 7.1(s);
(c) any event of default or default described in a Security Document, any
of the O&M Contracts or the License Agreement, other than any Events of Default
specifically provided in this Section 8.1, shall occur and remain unremedied
after any applicable grace period therefor, or if no grace period is provided
therein, the applicable grace period for purposes hereof shall be thirty (30)
days following notice to the Borrower by the Agent of the occurrence of such
event of default or default;
(d) default by any Credit Party in the observance or performance of any
provision hereof or of any other Credit Document not mentioned in (a), (b) or
(c) above, which is not remedied within thirty (30) days after notice thereof to
the Borrower by the Agent;
(e) any representation or warranty made or deemed made herein or in any
other Credit Document by the Borrower or Transocean proves untrue in any
material respect as of the date of the making, or deemed making, thereof;
(f) default occurs in the payment when due of Indebtedness in an aggregate
principal amount of $5,000,000 or more when aggregated with any Indebtedness
described in Section 8.1(1) which is then in default, of the Borrower (other
than Indebtedness to Transocean or any of its Subsidiaries) after any applicable
grace period therefor, and such default, if in payment when due of Indebtedness,
continues for a period of time sufficient to permit the holder or beneficiary of
such Indebtedness, or a trustee therefor, to cause the acceleration of the
maturity of any such Indebtedness or any mandatory unscheduled prepayment,
purchase, or other early funding thereof;
(g) the Borrower, Transocean, Amoco (during the stated term (other than
any portion thereof cancelled pursuant to the Free Cancellation Right) of either
Amoco Contract) or any substitute contracting party under a Substitute Contract
(during the stated term of any such Substitute Contract) (i) has entered
involuntarily against it an order for relief under the United States Bankruptcy
Code or a comparable action is taken under any bankruptcy or insolvency law of
another country or political subdivision of such country, (ii) generally does
not pay, or admits its inability generally to pay, its debts as they become due,
(iii) makes a general assignment for
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the benefit of creditors, (iv) applies for, seeks, consents to, or acquiesces
in, the appointment of a receiver, custodian, trustee, liquidator or similar
official for it or any substantial part of its property under the Bankruptcy
Code or under the bankruptcy or insolvency laws of another country or a
political subdivision of such country, (v) institutes any proceeding seeking to
have entered against it an order for relief under the United States Bankruptcy
Code or any comparable law, to adjudicate it insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fails to file an answer or other pleading
denying the material allegations of or consents to or acquiesces in any such
proceeding filed against it, (vi) makes any board of directors resolution in
direct furtherance of any matter described in clauses (i)-(v) above, or (vii)
fails to contest in good faith any appointment or proceeding described in this
Section 8.1(g);
(h) a custodian, receiver, trustee, liquidator or similar official is
appointed for the Borrower, Transocean, Amoco (during the stated term (other
than any portion thereof cancelled pursuant to the Free Cancellation Right) of
either Amoco Contract), or any substitute contracting party under a Substitute
Contract (during the stated term of any such Substitute Contract), or any
substantial part of its property under the Bankruptcy Code or under the
bankruptcy or insolvency laws of another country or a political subdivision of
such country, or a proceeding described in Section 8.1(g)(v) is instituted
against the Borrower, Transocean, Amoco or such substitute lessee, and such
appointment continues undischarged or such proceeding continues undismissed and
unstayed for a period of sixty (60) days (or one hundred twenty (120) days in
the case of any such event occurring outside the United States of America);
(i) the Borrower or Transocean fails within thirty (30) days with respect
to a judgment or order that is rendered in the United States or sixty (60) days
with respect to a judgment or order that is rendered in a foreign jurisdiction
(or such earlier date as any execution on such judgment or order shall take
place) to vacate, pay, bond or otherwise discharge any judgment or order for the
payment of money the uninsured portion of which is in excess of $5,000,000 with
respect to the Borrower and $15,000,000 with respect to Transocean and which is
not stayed on appeal or otherwise being appropriately contested in good faith in
a manner that stays execution;
(j) the Borrower fails to pay when due an amount aggregating in excess of
$5,000,000 that it is liable to pay to the PBGC or to a Plan under Title IV of
ERISA; or a notice of intent to terminate a Plan having Unfunded Vested
Liabilities of the Borrower in excess of $5,000,000 (a "Material Plan") is filed
under Title IV of ERISA; or the PBGC institutes proceedings under Title IV of
ERISA to terminate or to cause a trustee to be appointed to administer any
Material Plan or a proceeding is instituted by a fiduciary of any Material Plan
against the Borrower or to collect any liability under Section 515 or 4219(c)(5)
of ERISA, and in each case such proceeding is not dismissed within thirty (30)
days thereafter; or a condition exists by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any Material Plan must be
terminated;
(k) any Credit Party or any Person authorized to act on behalf of a Credit
Party challenges the validity of any Credit Document or such Credit Party's
obligations thereunder in any material respect, or any Credit Document ceases,
other than in accordance with its terms, to
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be valid and binding or ceases, in any material respect, other than in
accordance with its terms, to give to the Agent and the Lenders the Liens,
rights, and powers purported to be granted in their favor thereby;
(l) the Borrower shall default in any payment under any Interest Rate
Protection Agreement required pursuant to Section 7.1(j) when obligated to make
such payment, whether by acceleration or otherwise, and such payment default
shall continue after any applicable grace period and be in an amount in excess
of $5,000,000 when aggregated with all Indebtedness described in Section 8.1(f)
which is then in default as described in Section 8.1(f);
(m) Transocean shall fail to directly or indirectly own one hundred
percent (100%) of the stock of the Borrower;
(n) any event of default under the Transocean Performance Guaranty shall
occur and shall be continuing (it being understood and agreed that such event of
default shall cease to be "continuing" for the purposes of this Agreement when
it shall cease to constitute a continuing event of default under the Transocean
Performance Guaranty for any reason (including without limitation as a result of
the curing thereof or any waiver or modification thereunder)) after any
applicable cure period therefor;
(o) any event of default under the Transocean Contracts Loan Agreement
shall occur and shall be continuing (it being understood and agreed that such
event of default shall cease to be "continuing" for the purposes of this
Agreement when it shall cease to constitute a continuing event of default under
the Transocean Contracts Loan Agreement for any reason (including, without
limitation, as a result of the curing thereof or any waiver or modification
thereunder)) after any applicable grace period therefor;
(p) any event of default shall occur under the Transocean Credit Facility
and shall be continuing (it being understood and agreed that such event of
default shall cease to be "continuing" for the purposes of this Agreement when
it shall cease to constitute a continuing event of default under the Transocean
Credit Facility for any reason (including, without limitation, as a result of
the curing thereof or any waiver or modification thereunder)) after any
applicable grace period therefor; provided that such event shall not be an Event
of Default hereunder so long as (i) the Cash Flow Reserve and the Insurance
Reserve shall be funded to the maximum extent that the Borrower then could be
required to fund such accounts pursuant to Section 7.1(f)(iii) or 7.1(m), (ii)
the Borrower has effected a "true-up" of the financial terms of the Interest
Rate Protection Agreement or Agreements in effect at such time to the extent
necessary to eliminate any over-hedged position at such time as a result of any
prior optional or mandatory prepayment of the Obligations and (iii) the stated
operating dayrate reduction described in Section 2.5(h) shall not have occurred,
or if such event shall have occurred, the Borrower or Transocean shall have made
the mandatory prepayment required in Section 2.5(h) as a result thereof; or
(q) any default (as defined in the applicable contract) or event of
default (as defined in the applicable contract) under any of the Amoco
Contracts, the Transocean Contracts or the Substitute Contracts shall occur and
shall be continuing (it being understood and agreed that
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such default or event of default shall cease to be "continuing" for the purposes
of this Agreement when it shall cease to constitute a continuing default or
event of default under any such agreement for any reason (including without
limitation as a result of the curing thereof or any waiver or modification
thereunder)) after any applicable grace period therefor, or any of such
contracts shall be cancelled or terminated (other than if a cancellation fee or
termination fee is to be paid pursuant to the terms thereof, other than the free
cancellation provided in the Amoco Rig Contract and other than any termination
of a Transocean Contract in accordance with Section 7.1(r)) or otherwise no
longer in full force and effect prior to the stated term thereof, including,
without limitation, as a result of an Event of Loss or Casualty Loss (unless the
Borrower is in compliance with Section 2.5(a) or (b), as applicable and Sections
7.1(f)(iii) and 7.1(m)) or an event of Force Majeure; provided, that it shall
not be an Event of Default hereunder if the Borrower shall be contesting in good
faith any dispute in connection with any of such contracts so long as reserves
in accordance with GAAP are established and all Obligations of the Borrower are
being timely paid hereunder.
Section 8.2. Non-Bankruptcy Defaults. When any Event of Default
(other than those described in Section 8.1(g) or (h) with respect to the
Borrower) has occurred and is continuing, the Agent shall, by notice to the
Borrower: (a) if so directed by the Instructing Group, terminate the remaining
Commitments to the Borrower hereunder on the date stated in such notice (which
may be the date thereof); and (b) if so directed by the Instructing Group,
declare the principal of and the accrued interest on all outstanding Loans to be
forthwith due and payable and thereupon all outstanding Loans, including both
principal and interest thereon, shall be and become immediately due and payable
together with all other accrued amounts payable under the Credit Documents
without further demand, presentment, protest or notice of any kind, including,
but not limited to, notice of intent to accelerate and notice of acceleration,
each of which is expressly waived by the Borrower. The Agent, after giving
notice to the Borrower pursuant to this Section 8.2, shall also promptly send a
copy of such notice to the other Lenders, but the failure to do so shall not
impair or annul the effect of such notice.
Section 8.3. Bankruptcy Defaults. When any Event of Default
described in Section 8.1(g) or (h) has occurred and is continuing with respect
to the Borrower, then all outstanding Loans shall immediately become due and
payable together with all other accrued amounts payable under the Credit
Documents without presentment, demand, protest or notice of any kind, each of
which is expressly waived by the Borrower; and all Commitments of the Lenders
hereunder shall immediately terminate.
Section 8.4. Notice of Default. The Agent shall give notice to
the Borrower under Section 8.2 promptly upon being requested to do so by the
Instructing Group and shall thereupon notify all the Lenders thereof.
ARTICLE IX
THE AGENTS
Section 9.1. Appointment and Authorization. Each Lender hereby
irrevocably designates and appoints ABN AMRO Bank N.V. as the "Agent" and the
"Collateral Agent" hereunder and under the other Credit Documents and authorizes
the Agent and the Collateral Agent to take such
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actions and to exercise such powers as are delegated to the Agent and the
Collateral Agent hereby and under any Credit Document and to exercise such other
powers as are reasonably incidental thereto. Neither the Agent nor the
Collateral Agent shall have any duties other than those expressly set forth
herein or any fiduciary relationship with any Lender, and no implied obligations
or liabilities shall be read into this Agreement, or otherwise exist, against
the Agent or the Collateral Agent. Neither the Agent nor the Collateral Agent
assumes, nor shall it be deemed to have assumed, any obligation to, or
relationship of trust or agency with, the Borrower.
Section 9.2. Delegation of Duties. The Agent and the Collateral
Agent may execute any of their duties through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. Neither the Agent nor the Collateral Agent shall be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
Section 9.3. Exculpatory Provisions. Neither the Agent nor the
Collateral Agent nor any of their directors, officers, agents or employees shall
be liable for any action taken or omitted (i) with the consent or at the
direction of the Instructing Group or (ii) in the absence of such Person's gross
negligence or willful misconduct. Neither the Agent nor the Collateral Agent
shall be responsible to any Lender or other Person for (i) any recitals,
representations, warranties or other statements made by the Borrower, Transocean
or any of their Affiliates, (ii) the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any Credit Document, (iii) any
failure of the Borrower, Transocean or any of their Affiliates to perform any
obligation or (iv) the satisfaction of any condition specified in Article V
except the receipt of documents to be received by it as provided therein.
Neither the Agent nor the Collateral Agent shall have any obligation to any
Lender to ascertain or inquire about the observance or performance of any
agreement contained in any Credit Document or to inspect the properties, books
or records of the Borrower, Transocean or any of their Affiliates.
Section 9.4. Reliance by Agent. The Agent and the Collateral
Agent shall in all cases be entitled to rely, and shall be fully protected in
relying, upon any document, other writing or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
and upon advice and statements of legal counsel (including counsel to the
Borrower), independent accountants and other experts selected by the Agent and
the Collateral Agent. The Agent and the Collateral Agent shall in all cases be
fully justified in failing or refusing to take any action under any Credit
Document unless it shall first receive such advice or concurrence of the
Lenders, and assurance of its indemnification, as it deems appropriate.
Section 9.5. Assumed Payments. Unless the Agent shall have
received notice from the applicable Lender before the date of any Put or of any
Borrowing that such Lender will not make available to the Agent the amount it is
scheduled to remit as part of such Put or Borrowing the Agent may assume such
Lender has made such amount available to the Agent when due (an "Assumed
Payment") and, in reliance upon such assumption, the Agent may (but shall have
no obligation to) make available such amount to the appropriate Person. If and
to the extent that any Lender shall not have made its Assumed Payment available
to the Agent, such Lender (and the Borrower in the case of any Borrowing) hereby
agrees to pay the Agent forthwith on demand such unpaid portion of such Assumed
Payment up to the amount of funds actually paid by the
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Agent, together with interest thereon for each day from the date of such payment
by the Agent until the date the requisite amount is repaid to the Agent, at a
rate per annum equal to the Federal Funds Rate plus 2%.
Section 9.6. Notice of Defaults or Put Events. Neither the Agent
nor the Collateral Agent shall be deemed to have knowledge or notice of the
occurrence of any Default or Put Event unless the Agent and the Collateral Agent
have received notice from any Lender or the Borrower stating that a Default or
Put Event has occurred hereunder and describing such Default or Put Event. The
Agent and the Collateral Agent shall take such action concerning a Default or
Put Event as may be directed by the Instructing Group (or, if required for such
action, all of the Lenders), but until the Agent and the Collateral Agent
receive such directions, the Agent and the Collateral Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, as the
Agent and the Collateral Agent deem advisable and in the best interests of the
Lenders.
Section 9.7. Non-Reliance on Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Agent, the Collateral Agent nor any of
their officers, directors, employees, agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act by the Agent or
the Collateral Agent hereafter taken, including any review of the affairs of the
Borrower or Transocean, shall be deemed to constitute any representation or
warranty by the Agent or the Collateral Agent. Each Lender represents and
warrants to the Agent and the Collateral Agent that, independently and without
reliance upon the Agent or the Collateral Agent or any other Lender and based on
such documents and information as it has deemed appropriate, it has made and
will continue to make its own appraisal of and investigation into the business,
operations, property, prospects, financial and other conditions and
creditworthiness of the Borrower, Transocean, and the Amoco Contracts and its
own decision to enter into this Agreement and to take, or omit to take, action
under any Credit Document. The Agent shall deliver each month to any Lender
that so requests a copy of any report received covering the preceding calendar
month. Except for items specifically required to be delivered hereunder,
neither the Agent nor the Collateral Agent shall have any duty or responsibility
to provide any Lender with any information concerning the Borrower, Transocean
or any of their Affiliates that comes into the possession of the Agent or the
Collateral Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
Section 9.8. Agent and Affiliates. The Agent and the Collateral
Agent and their Affiliates may extend credit to, accept deposits from and
generally engage in any kind of business with the Borrower, Transocean or any of
their Affiliates and, in its roles as a Liquidity Provider and the Enhancer, ABN
AMRO may exercise or refrain from exercising its rights and powers as if it were
not the Agent or the Collateral Agent. The parties acknowledge that ABN AMRO
acts as agent for Amsterdam and subagent for Amsterdam's management company in
various capacities, as well as providing credit facilities and other support for
Amsterdam not contained in the Credit Documents.
Section 9.9. Indemnification. Each Committed Lender shall indemnify
and hold harmless the Agent and the Collateral Agent and their officers,
directors, employees, representatives and agents (to the extent not reimbursed
by the Borrower and without limiting the
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obligation of the Borrower to do so), ratably in accordance with its Ratable
Share from and against any and all liabilities, obligations, losses, damages,
penalties, judgments, settlements, costs, expenses and disbursements of any kind
whatsoever (including in connection with any investigative or threatened
proceeding, whether or not the Agent or the Collateral Agent or such Person
shall be designated a party thereto) that may at any time be imposed on,
incurred by or asserted against the Agent or the Collateral Agent or such Person
as a result of or related to any of the transactions contemplated by the Credit
Documents or the execution, delivery or performance of the Credit Documents or
any other document furnished in connection therewith (but excluding any such
liabilities, obligations, losses, damages, penalties, judgments, settlements,
costs, expenses or disbursements resulting solely from the gross negligence or
willful misconduct of the Agent or the Collateral Agent or such Person as
finally determined by a court of competent jurisdiction).
Section 9.10. Successor Agent. The Agent or the Collateral Agent
may, upon at least thirty (30) days' notice to the Borrower and each Lender,
resign as Agent or the Collateral Agent. Such resignation shall not become
effective until a successor agent is appointed by an Instructing Group and has
accepted such appointment. Upon such acceptance of its appointment as the Agent
or the Collateral Agent hereunder by a successor Agent or Collateral Agent, such
successor Agent or Collateral Agent shall succeed to and become vested with all
the rights and duties of the retiring Agent or Collateral Agent, and the
retiring Agent or Collateral Agent shall be discharged from its duties and
obligations under the Credit Documents. After any retiring Agent's or
Collateral Agent's resignation hereunder, the provisions of Article IV and this
Article IX shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was the Agent or the Collateral Agent.
ARTICLE X
MISCELLANEOUS
Section 10.1. Termination. Amsterdam shall cease to be a party
hereto when the Amsterdam Termination Date has occurred, Amsterdam holds no Loan
and all amounts payable to it hereunder have been indefeasibly paid in full, and
thereafter Amsterdam shall have no rights hereunder (except to the extent that
any right of Amsterdam survives the termination of this Agreement by the express
terms hereof) and all references to Amsterdam shall be disregarded (except for
references to Amsterdam in any provision relating to the survival of rights
hereunder). This Agreement shall terminate following the Liquidity Termination
Date when no Loans are held by a Lender and all other amounts payable hereunder
have been indefeasibly paid in full, but the rights and remedies of the Agent
and each Lender concerning any covenant made by the Borrower under Article IV,
and under Section 9.9, shall survive such termination.
Section 10.2. Notices. Unless otherwise specified, all notices
and other communications hereunder shall be in writing (including by telecopier
or other facsimile communication), given to the appropriate Person at its
address or telecopy number set forth on the signature pages hereof or at such
other address or telecopy number as such Person may specify, and effective when
received at the address specified by such Person. Each party hereto, however,
authorizes the Agent to act on telephone notices of Loans, Puts, and interest
rate and Interest Period selections from any person the Agent in good faith
believes to be acting on behalf of the relevant party and,
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at the Agent's option, to tape record any such telephone conversation. Each
party hereto agrees to deliver promptly to the Agent a confirmation of each
telephone notice given or received by such party (signed by an authorized
officer of such party), but the absence of such confirmation shall not affect
the validity of the telephone notice. The Agent's records of all such
conversations shall be deemed correct absent manifest error and, if the
confirmation of a conversation differs in any material respect from the action
taken by the Agent, the records of the Agent shall govern absent manifest error.
The number of days for any advance notice required hereunder may be waived
(orally or in writing) by the Person receiving such notice and, in the case of
notices to the Agent, the consent of each Person to which the Agent is required
to forward such notice.
Section 10.3. Payments and Computations. Notwithstanding anything
herein to the contrary, any amounts to be paid or transferred by the Borrower
to, or for the benefit of, any Lender, or any other Person shall be paid or
transferred to the Agent (for the benefit of such Lender or other Person). The
Agent shall promptly (and, if reasonably practicable, on the day it receives
such amounts) forward each such amount to the Person entitled thereto and such
Person shall apply the amount in accordance herewith. All amounts to be paid or
deposited hereunder shall be paid or transferred on the day when due in
immediately available Dollars (and, if due from the Borrower, by 11:00 a.m.
(Chicago time), with amounts received after such time being deemed paid on the
Business Day following such receipt). To the fullest extent permitted by
applicable law, the Borrower hereby authorizes the Agent to debit the Borrower
Account for application to any amounts due and payable by the Borrower
hereunder. Except as otherwise expressly provided in Section 2.7, the Borrower
shall, to the extent permitted by law, pay to the Agent upon demand, for the
account of the applicable Person, interest on all amounts not paid or
transferred by the Borrower when due hereunder at a rate equal to the Base Rate
plus 2% per annum, calculated from the date any such amount became due until the
date paid in full. Any payment or other transfer of funds scheduled to be made
on a day that is not a Business Day shall be made on the next Business Day, and
any interest rate accruing on such amount to be paid or transferred shall
continue to accrue to such next Business Day.
Section 10.4. Setoff. In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
upon the occurrence of, and throughout the continuance of, any Event of Default,
each Lender is hereby authorized by the Borrower at any time or from time to
time, to the extent permitted by law, without notice to the Borrower or any
other Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, including,
but not limited to, Indebtedness evidenced by certificates of deposit, whether
matured or unmatured, but not including trust accounts, and in whatever currency
denominated) and any other Indebtedness at any time owing by that Lender or that
subsequent holder to or for the credit or the account of the Borrower, whether
or not matured, against and on account of the due and unpaid obligations and
liabilities of the Borrower to that Lender or that subsequent holder under the
Credit Documents, irrespective of whether or not that Lender or that subsequent
holder shall have made any demand hereunder. Each Lender shall promptly give
notice to the Borrower of any action taken by it under this Section 10.4,
provided that any failure of such Lender to give such notice to the Borrower
shall not affect the validity of such setoff. Each Lender agrees with each
other Lender a party hereto that if such Lender receives and retains any
payment, whether by setoff or
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application of deposit balances or otherwise, on any of the Loans in excess of
the share of payments to which such Lender is entitled under Section 3.2 on all
such Obligations then owed to the Lenders hereunder, then such Lender shall
purchase for cash at face value, but without recourse, ratably from each of the
other Lenders such amount of the Loans, or participations therein, held by each
such other Lender as shall be necessary to cause such Lender to share such
excess payment ratably with all the other Lenders; provided, however, that if
any such purchase is made by any Lender, and if such excess payment or part
thereof is thereafter recovered from such purchasing Lender, the related
purchases from the other Lenders shall be rescinded ratably and the purchase
price restored as to the portion of such excess payment so recovered, but
without interest.
Section 10.5. Amendments, Waivers and Consents. Subject to Sections
10.11 and 10.25, any provision of the Credit Documents may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed
(and/or consented to) by (a) the Borrower, (b) the Instructing Group, and (c) if
the rights or duties of the Agent or the Collateral Agent are affected thereby,
the Agent or the Collateral Agent, as the case may be, provided that:
(i) no amendment or waiver shall (A) increase the Aggregate
Commitment without the consent of all Lenders or increase any Commitment of
any Lender without the consent of such Lender or extend the Liquidity
Termination Date with respect to a Lender without the consent of such
Lender, (B) postpone any Amortization Date without the consent of all
Lenders or reduce the amount (other than pursuant to Section 2.3(b)) of or
postpone the date for any Scheduled Principal Payment or any scheduled
payment of any interest on any Loan or any fee payable hereunder to any
Lender without the consent of each Lender owed any such Obligation, (C)
release any Collateral for any Obligation (including, without limitation,
the Transocean Performance Guaranty) without the consent of all Lenders
(except in connection with Transfers permitted under the Security
Documents), or (D) amend or waive any provision of Article III without the
consent of all Lenders; and
(ii) no amendment or waiver shall, unless signed by each Lender,
change the provisions of this Section 10.5 or the definition of Instructing
Group or of Required Liquidity Providers or the number of Lenders required
to take any action under any other provision of the Credit Documents.
To the extent that any amendment or waiver of any provision of any Operative
Document (other than any Credit Document) requires any consent of the Lenders,
such Operative Document may so be amended or waived if, but only if, such
amendment or waiver is consented to by the Instructing Group.
Section 10.6. Waivers. No failure or delay of the Agent or any
Lender in exercising any power, right, privilege or remedy hereunder shall
operate as a waiver thereof, nor (to the fullest extent permitted by applicable
law) shall any single or partial exercise of any such power, right, privilege or
remedy preclude any other or further exercise thereof or the exercise of any
other power, right, privilege or remedy. Any waiver hereof shall be effective
only in the specific instance and for the specific purpose for which such waiver
was given. After any waiver, the
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Borrower, the Lenders and the Agent shall be restored to their former position
and rights and any Default or Put Event waived shall be deemed to be cured and
not continuing, but no such waiver shall extend to (or impair any right
consequent upon) any subsequent or other Default or Put Event. Any additional
interest that has accrued after an Event of Default before the execution of a
waiver thereof, solely as a result of the occurrence of such an Event of
Default, may be waived by the Agent at the direction of the Lender entitled
thereto or, in the case of interest owing to the Liquidity Providers, of the
Required Liquidity Providers.
Section 10.7. Successors and Assigns. This Agreement shall be
binding upon the Borrower, each of the Lenders, the Agent, the Collateral Agent
and their respective successors and assigns, and shall inure to the benefit of
the Borrower, each of the Lenders, the Agent, the Collateral Agent and their
respective successors and assigns; provided, however, the Borrower may not
assign any of its rights or obligations under this Agreement or any other Credit
Document without the written consent of all Lenders, the Agent and the
Collateral Agent, and the Agent and the Collateral Agent may not assign any of
their respective rights or obligations under this Agreement or any Credit
Document except in accordance with Section 9 and no Committed Lender may assign
any of its rights or obligations under this Agreement or any other Credit
Document except in accordance with Section 10.8. Any Committed Lender may at
any time pledge or assign all or any portion of its rights under this Agreement
to a Federal Reserve Bank to secure extensions of credit by such Federal Reserve
Bank to such Committed Lender; provided that no such pledge or assignment shall
release a Committed Lender from any of its obligations hereunder or substitute
any such Federal Reserve Bank for such Committed Lender as a party hereto.
Section 10.8. Participations and Assignments. (a) Participations.
Any Committed Lender may at any time sell to one or more commercial banking
institutions ("Participants") participating interests in any Borrowing owing to
such Committed Lender, any Commitment of such Committed Lender or any other
interest of such Committed Lender hereunder, provided that no Committed Lender
may sell any participating interests in any such Borrowing, Commitment or other
interest hereunder without also selling to such Participant the appropriate pro
rata share of all its Borrowings, Commitments and other interests hereunder, and
provided further that no Committed Lender shall transfer, grant or assign any
participation under which the Participant shall have rights to vote upon or to
consent to any matter to be decided by the Committed Lenders or the Instructing
Group hereunder or under any other Operative Document or to approve any
amendment to or waiver of this Agreement or any other Operative Document except
to the extent such amendment or waiver would (i) increase the amount of such
Committed Lender's Commitment and such increase would affect such Participant,
(ii) reduce the principal of, or interest on, any of such Committed Lender's
Loans, or any fees or other amounts payable to such Committed Lender hereunder
and such reduction would affect such Participant, (iii) postpone any date fixed
for any scheduled payment of principal of, or interest on, any of such Committed
Lender's Loans, or any fees or other amounts payable to such Committed Lender
hereunder and such postponement would affect such Participant, (iv) release any
Collateral for any Obligation, except as otherwise specifically provided in any
Credit Document or (v) extend the Liquidity Termination Date with respect to
such Participant. In the event of any such sale by a Committed Lender of
participating interests to a Participant, such Committed Lender's obligations
under this Agreement to the other parties to this Agreement shall remain
unchanged,
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such Committed Lender shall remain solely responsible for the performance
thereof, the Borrower and the Agent shall continue to deal solely and directly
with such Committed Lender in connection with such Committed Lender's rights and
obligations under this Agreement and such Committed Lender shall retain the sole
right (as between itself and the Participant) to enforce the obligations of any
Credit Party under any Credit Document. The Borrower agrees that if amounts
outstanding under this Agreement shall have been declared or shall have become
due and payable in accordance with Section 8.2 or 8.3 upon the occurrence of an
Event of Default, each Participant shall be deemed to have the right of setoff
in respect of its participating interest in amounts owing under this Agreement
to the same extent as if the amount of its participating interest were owing
directly to it as a Committed Lender under this Agreement, provided that such
right of setoff shall be subject to the obligation of such Participant to share
with the Committed Lenders, and the Committed Lenders agree to share with such
Participant, as provided in Section 10.4. The Borrower also agrees that each
Participant shall be entitled to the benefits of Sections 2.8(b), 4.7 and 4.4
with respect to its participation in the Commitments and the Borrowings
outstanding from time to time, provided that no Participant shall be entitled to
receive any greater amount pursuant to such Sections than the transferor
Committed Lender would have been entitled to receive in respect of the amount of
the participation transferred if no participation had been transferred and
provided, further, that Sections 4.4(c) and 10.8(c) shall apply to the
transferor Committed Lender with respect to any claim by any Participant
pursuant to Section 2.8(b), 4.7 or 4.4 as fully as if such claim was made by
such Committed Lender. Anything herein to the contrary notwithstanding, the
Borrower shall not, at any time, be obligated to pay to any Committed Lender any
sum in excess of the sum the Borrower would have been obligated to pay to such
Committed Lender hereunder if such Committed Lender had not sold any
participation in its rights and obligations under this Agreement or any other
Credit Document.
(b) Assignments. Any Committed Lender may at any time sell to (i) any
other Committed Lender, or any affiliate thereof, that is a commercial banking
institution not subject to Regulation T of the Board of Governors of the Federal
Reserve System so long as such entity has a short-term rating of A-1 from S&P
and P-1 from Xxxxx'x (unless otherwise agreed by the Agent, the Borrower and
Transocean), (ii) with the prior written consent of the Agent and the Borrower
(which shall not be unreasonably withheld or delayed), to one or more commercial
banking institutions not subject to Regulation T of the Board of Governors of
the Federal Reserve System and which has a short-term rating of A-1 from S&P and
P-1 from Xxxxx'x (unless otherwise agreed by the Agent, the Borrower and
Transocean), (any of (i) or (ii), a "Replacement Committed Lender"), all or any
part of its rights and obligations under this Agreement and the other Credit
Documents, pursuant to an Assignment Agreement in the form attached as Exhibit
10.8, executed by such Replacement Committed Lender and such transferor
Committed Lender (and, in the case of a Replacement Committed Lender which is
not then a Committed Lender or an affiliate thereof, by the Borrower and the
Agent) and delivered to the Agent; provided that each such sale to a Replacement
Committed Lender shall be in an amount of $10,000,000 or more, or if in a lesser
amount or if as a result of such sale the sum of the unfunded Commitment of such
Committed Lender plus the aggregate principal amount of such Committed Lender's
Loans would be less than $10,000,000, such sale shall be of all of such
Committed Lender's rights and obligations under this Agreement and all of the
other Credit Documents payable to it to one Replacement Committed Lender.
Notwithstanding the
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requirement of the Borrower's consent set forth above, but subject to all of the
other terms and conditions of this Section 10.8(b), any Committed Lender may
sell to one or more commercial banking institutions not subject to Regulation T
of the Board of Governors of the Federal Reserve System, all or any part of its
rights and obligations under this Agreement and the other Credit Documents with
only the consent of the Agent (which shall not be unreasonably withheld or
delayed) if the Loans have been accelerated pursuant to Section 8.2 or 8.3. No
Committed Lender may sell any Loans to a Replacement Committed Lender without
also selling to such Replacement Committed Lender the appropriate pro rata share
of (i) all of its Loans, Commitments and other interests hereunder and (ii) all
of its Transocean Contracts Loans and "Commitments" under the Transocean
Contracts Loan Agreement. Upon such execution, delivery and acceptance, from and
after the effective date of the transfer determined pursuant to such Assignment
Agreement, (x) the Replacement Committed Lender thereunder shall be a party
hereto and, to the extent provided in such Assignment Agreement, have the rights
and obligations of a Committed Lender hereunder with a Commitment as set forth
herein and (y) the transferor Committed Lender thereunder shall, to the extent
provided in such Assignment Agreement, be released from its obligations under
this Agreement (and, in the case of an Assignment Agreement covering all or the
remaining portion of a transferor Committed Lender's rights and obligations
under this Agreement, such transferor Committed Lender shall cease to be a party
hereto (except as to Sections 4.1, 4.4 and 4.7 for periods prior to the
effective date of such assignment). Such Assignment Agreement shall be deemed to
amend this Agreement to the extent, and only to the extent, necessary to reflect
the addition of such Replacement Committed Lender and the resulting adjustment
of Commitments and Percentages arising from the purchase by such Replacement
Committed Lender of all or a portion of the rights and obligations of such
transferor Committed Lender under this Agreement and the other Credit Documents.
(c) Replaceable Committed Lenders. If any Committed Lender (a
"Replaceable Committed Lender") (i) shall demand compensation or give notice of
its intention to demand compensation under Section 4.4, (ii) shall cease to have
a short-term debt rating of "A-1" by S&P and "P-1" by Xxxxx'x (unless otherwise
agreed by the Agent, the Borrower and Transocean), (iii) shall require the
Borrower to pay any additional amount to any Committed Lender under Section
2.8(b), (iv) is unable to submit any form or certificate required under Section
4.7(b) or withdraws or cancels any previously submitted form with no
substitution therefor, (v) gives notice of any change in law or regulations, or
in the interpretation thereof, pursuant to Section 4.2, (vi) has been declared
insolvent or a receiver or conservator has been appointed for a material portion
of its assets, business or properties, (vii) is a Defaulting Lender or shall
seek to avoid its obligation to make Loans hereunder for any reason, including,
without limitation, reliance upon 12 U.S.C. (S) 1821(e) or (n)(1)(B), (viii)
shall require withholding or deductions by the Borrower or payment by the
Borrower of additional amounts to such Lender, or other reimbursement or
indemnification of such Committed Lender, as a result of any taxes referred to
in Section 4.7 having been levied or imposed (or if such Taxes have been imposed
or levied on such Committed Lender or if the Borrower determines in good faith
that there is a substantial likelihood that such Taxes will be levied or imposed
with respect to such Committed Lender), or (ix) shall decline to consent to a
modification or waiver of the terms of this Agreement or any other Operative
Document requested by the Borrower, the Borrower (and/or, in the case of an
event described in the foregoing clause (ii), Amsterdam) may designate a
Replacement Committed Lender reasonably satisfactory to the Agent and
satisfactory to
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Amsterdam, in its sole discretion, to which such Replaceable Committed Lender
shall, subject to its receipt of an amount equal to its Principal Amount and
accrued interest and fees thereon (plus, from the Borrower, any Early Payment
Fee that would have been payable if such transferred Principal Amount had been
paid on such date) and all amounts due and payable to it under Section 4.4,
promptly assign all of its rights, obligations and Commitment hereunder,
together with all of its Principal Amount, to the Replacement Committed Lender
in accordance with Section 10.8(b). In the case of an event described in clause
(ii) of the preceding sentence, if a Replacement Committed Lender, has not
assumed the Replaceable Committed Lender's Commitment within 30 days of such
rating cessation, the Replaceable Committed Lender (a "Funding Replaceable
Committed Lender") shall make a Loan in the principal amount of its then Unused
Commitment. The proceeds of such Loan shall be deposited with the Agent and
applied on the next Amortization Date to repay solely Loans then owed Amsterdam
without thereby reducing the aggregate principal amount of outstanding Loans.
Thereafter, such Loan from the Replaceable Committed Lender shall be repaid to
the extent provided pursuant to Section 3.2 for Loans from a Liquidity Provider.
(d) Registration and Processing Fee. Upon its receipt of an Assignment
Agreement executed by a transferor Committed Lender, a Replacement Committed
Lender and the Agent (and, in the case of a Replacement Committed Lender that is
not then a Committed Lender or an affiliate thereof, by the Borrower), together
with payment by the transferor Committed Lender to the Agent hereunder of a
registration and processing fee of $3,500 (unless (x) the Borrower is replacing
such Committed Lender pursuant to the terms hereof, in which event such fee
shall be paid by the Borrower, or (y) Amsterdam is replacing such Committed
Lender pursuant to the terms hereof, in which event no such fee shall be
payable), the Agent shall (i) promptly accept such Assignment Agreement, and
(ii) on the effective date of the transfer determined pursuant thereto give
notice of such acceptance and recordation to the Committed Lenders and the
Borrower. The payment of a registration and processing fee by the Borrower or
the transferor Committed Lender under any comparable provision of the Transocean
Contracts Loan Agreement shall satisfy the obligation of the Borrower or the
transferor Committed Lender, as applicable, to pay a registration and processing
fee under this Section 10.8(d). The Borrower shall not be responsible for such
registration and processing fee or any costs or expenses incurred by any
Committed Lender, any Replacement Committed Lender or the Agent in connection
with such assignment except as provided above.
(e) Withholding Taxes. If, pursuant to this Section 10.8 any interest in
this Agreement or the Note is transferred to any transferee which is organized
under the laws of any jurisdiction other than the United States of America or
any State thereof, the transferor Committed Lender shall cause such transferee,
concurrently with the effectiveness of such transfer, (i) to represent to the
transferor Committed Lender (for the benefit of the transferor Committed Lender,
the Agent and the Borrower) that under applicable law and treaties no taxes will
be required to be withheld by the Agent, the Borrower or the transferor
Committed Lender with respect to any payments to be made to such transferee in
respect of the Loans, (ii) to furnish to the transferor Committed Lender (and,
in the case of any Replacement Committed Lender, the Agent and the Borrower) two
duly completed and signed copies of either U.S. Internal Revenue Service Form
W-8ECI or U.S. Internal Revenue Service Form W-8BEN or such successor forms as
shall be adopted from time to time by the relevant United States taxing
authorities (wherein such
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transferee claims entitlement to complete exemption from U.S. federal
withholding tax on all interest payments hereunder), and (iii) to agree (for the
benefit of the transferor Committed Lender, the Agent and the Borrower) to
provide the transferor Committed Lender (and, in the case of any Replacement
Committed Lender, the Agent and the Borrower) new forms as contemplated by
Section 4.7(b) upon the expiration or obsolescence of any previously delivered
form and comparable statements in accordance with applicable U.S. laws and
regulations and amendments duly executed and completed by such transferee, and
to comply from time to time with all applicable U.S. laws and regulations with
regard to such withholding tax exemption.
(f) Prohibition of Transfer in Violation of Securities Laws.
Notwithstanding any other provisions of this Section 10.8, no transfer or
assignment of the interests of any Committed Lender hereunder or any grant of
participations therein shall be permitted if such transfer, assignment or grant
would require the Borrower or Transocean to file a registration statement with
the SEC or to qualify the Loans, the Note or any other Obligations under the
securities laws of any jurisdiction.
(g) Assignment by Amsterdam. Each party hereto agrees and consents (i) to
Amsterdam's assignment, participation, grant of security interests in or other
transfers of any portion of, or any of its beneficial interest in, the Loans
held by Amsterdam and (ii) to the complete assignment by Amsterdam of all of its
rights and obligations hereunder to ABN AMRO or any other Person, and upon such
assignment Amsterdam shall be released from all obligations and duties
hereunder; provided, however, that Amsterdam may not, without the prior consent
of the Instructing Group, transfer any of its rights under Section 3.1 to cause
the Liquidity Providers or the Enhancer to purchase the Amsterdam Principal
Amount unless the assignee (i) is a corporation whose principal business is the
purchase of assets similar to the Amoco Contracts, (ii) has ABN AMRO as its
administrative agent and (iii) issues commercial paper with credit ratings
substantially comparable to the Ratings, and further provided that any such
assignment, participation or transfer shall be subject to the limitations and
requirements set forth in Section 10.8(a), (b), (e) and (f). Amsterdam shall
promptly notify each party hereto of any such assignment. Upon such an
assignment of any portion of the Amsterdam Principal Amount, the assignee shall
have all of the rights of Amsterdam hereunder relating to such Amsterdam
Principal Amount.
(h) Opinions of Counsel. If required by the Agent or to maintain the
Ratings, each Assignment Agreement must be accompanied by an opinion of counsel
of the assignee as to such matters as the Agent may reasonably request.
Section 10.9. Intended Tax Characterization. It is the intention
of the parties hereto that, for the purposes of all Taxes, the transactions
contemplated hereby shall be treated as a loan by the Lenders (through the
Agent) to the Borrower that is secured by the Amoco Contracts (the "Intended Tax
Characterization"). The parties hereto agree to report and otherwise to act for
the purposes of all Taxes in a manner consistent with the Intended Tax
Characterization.
Section 10.10. Governing Law; Submission to Jurisdiction; Waiver of
Jury Trial. (A) THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES
HERETO, SHALL BE
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CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK.
(B) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HERETO
AGREE THAT ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
THE AGENT OR THE COLLATERAL AGENT, THE LENDERS OR THE BORROWER MAY BE BROUGHT
AND MAINTAINED IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX SITTING IN THE BOROUGH OF
MANHATTAN OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK AND THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH SUCH LITIGATION. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS, BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW
YORK. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER HEREBY
EXPRESSLY AND IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OF THE STATE OF NEW YORK
SITTING IN THE BOROUGH OF MANHATTAN OR THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK OR FROM ANY LEGAL PROCESS WITH RESPECT TO ANY
ACTION COMMENCED IN ANY SUCH COURT (WHETHER THROUGH SERVICE OF NOTICE,
ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS.
(C) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HERETO
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR
DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR UNDER ANY
AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE
FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT
DOCUMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.
Section 10.11. Confidentiality. Each Lender agrees it will not
disclose (and will cause its affiliates not to disclose) without the Borrower's
consent any information concerning the Borrower, Transocean or any direct or
indirect Subsidiaries of Transocean furnished pursuant to, or otherwise in
connection with, any of the Credit Documents (including without limitation any
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information concerning the intellectual property that is the subject of the
License Agreement); provided that any Lender may disclose any such information
(a) to its employees, auditors, counsel or other professional advisors who are
or are expected to be involved in the evaluation of such information in
connection with the transactions contemplated by this Agreement, each of whom
will be informed of, and shall abide by the provisions of, this Section 10.11,
(b) to any other Lender or to any affiliate of such Lender, (c) that has become
generally available to the public, (d) if required or appropriate in any
examination or audit by, or report, statement or testimony submitted to, any
federal or state regulatory body having or claiming to have jurisdiction over
such Lender, (e) if required or appropriate in response to any summons or
subpoena or in connection with any litigation, (f) in order to comply with the
mandatory provisions of any law, order, regulation or ruling applicable to such
Lender, (g) to any prospective or actual permitted transferee in connection with
any contemplated or actual permitted transfer of any of the Borrowings or any
interest therein by such Lender (provided that such actual or prospective
transferee executes an agreement with such Lender (and expressly for the benefit
of the Borrower and Transocean) containing provisions substantially identical to
those contained in this Section 10.11 prior to such transferee's receipt of any
such information), (h) in connection with the exercise of any remedies by the
Agent or any Lender, (i) to any rating agency, (j) to any surety, guarantor or
credit or liquidity enhancer to Amsterdam who in each case agree for the benefit
of the Borrower and Transocean to be bound by the provisions of this Section
10.11, (k) to any entity organized to purchase, or make loans secured by,
financial assets for which ABN AMRO provides managerial services or acts as an
administrative agent and who agrees for the benefit of the Borrower and
Transocean to be bound by the provisions of this Section 10.11, and (l) to
Amsterdam's administrator, management company, referral agents, issuing agents
or depositaries or CP Dealers, each of which will be informed of, and shall
abide by the provisions of, this Section 10.11. Each Lender hereby irrevocably
constitutes Transocean as, and agrees that Transocean shall be, an intended
third party beneficiary of the covenant of such Lender contained in this Section
10.11 and, without limitation of the foregoing, agrees that Transocean may
enforce such Lender's covenant set forth in this Section 10.11 without any
requirement that any action also be taken by the Borrower. This Section 10.11
may not be amended, modified or supplemented without the written consent of
Transocean.
Section 10.12. Confidentiality of Agreement. Unless otherwise
consented to by the Agent, the Borrower hereby agrees that it will not disclose
the contents of any Credit Document, or any other confidential or proprietary
information furnished by the Agent or any Lender, to any Person other than to
Transocean, the auditors and attorneys of the Borrower or Transocean, or as
required by (i) applicable law or (ii) listing agreements with, or applicable
rules or regulations of, any securities exchange or organization (in each case,
as determined in good faith by the Borrower or Transocean).
Section 10.13. Agreement Not to Petition. Each party hereto
agrees, for the benefit of the holders of the privately or publicly placed
indebtedness for borrowed money for Amsterdam, not, prior to the date which is
one (1) year and one (1) day after the payment in full of all such indebtedness,
to acquiesce, petition or otherwise, directly or indirectly, invoke, or cause
Amsterdam to invoke, the process of any Governmental Authority for the purpose
of (a) commencing or sustaining a case against Amsterdam under any federal or
state bankruptcy, insolvency or similar law (including the Federal Bankruptcy
Code), (b) appointing a receiver,
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liquidator, assignee, trustee, custodian, sequestrator or other similar official
for Amsterdam, or any substantial part of its property, or (c) ordering the
winding up or liquidation of the affairs of Amsterdam.
Section 10.14. Excess Funds. Other than amounts payable under
Xxxxxxx 00.0, Xxxxxxxxx shall be required to make payment of the amounts
required to be paid pursuant hereto only if Amsterdam has Excess Funds (as
defined below). If Amsterdam does not have Excess Funds, the excess of the
amount due hereunder (other than pursuant to Section 10.4) over the amount paid
shall not constitute a "claim" (as defined in Section 101(5) of the Federal
Bankruptcy Code) against Amsterdam until such time as Amsterdam has Excess
Funds. If Amsterdam does not have sufficient Excess Funds to make any payment
due hereunder (other than pursuant to Section 10.4), then Amsterdam may pay a
lesser amount and make additional payments that in the aggregate equal the
amount of deficiency as soon as possible thereafter. The term "Excess Funds"
means the excess of (a) the aggregate projected value of Amsterdam's assets and
other property (including cash and cash equivalents), over (b) the sum of (i)
the sum of all scheduled payments of principal, interest and other amounts
payable on publicly or privately placed indebtedness of Amsterdam for borrowed
money, plus (ii) the sum of all other liabilities, indebtedness and other
obligations of Amsterdam for borrowed money or owed to any credit or liquidity
provider, together with all unpaid interest then accrued thereon, plus (iii) all
taxes payable by Amsterdam to the Internal Revenue Service, plus (iv) all other
indebtedness, liabilities and obligations of Amsterdam then due and payable, but
the amount of any liability, indebtedness or obligation of Amsterdam shall not
exceed the projected value of the assets to which recourse for such liability,
indebtedness or obligation is limited. Excess Funds shall be calculated once
each Business Day.
Section 10.15. No Recourse. The obligations of Amsterdam, its
management company, its administrator and its referral agents (each a "Program
Administrator") under any Credit Document or other document relating to
Amsterdam (each, a "Program Document") to which a Program Administrator is a
party in such capacity are solely the corporate obligations of such Program
Administrator and no recourse shall be had for such obligations against any
Affiliate, director, officer, member, manager, employee, attorney or agent of
any Program Administrator.
Section 10.16. Limitation of Liability. No Person shall make a
claim against the Agent or any Lender (or their respective Affiliates,
directors, officers, members, managers, employees, attorneys or agents) for any
special, indirect, consequential or punitive damages under any claim for breach
of contract or other theory of liability in connection with the Credit Documents
or the transactions contemplated thereby, and the Borrower (for itself and all
other Persons claiming by or through the Borrower) hereby waives any claim for
any such damages.
Section 10.17. Headings; Counterparts. Article and section
headings in this Agreement are for reference only and shall not affect the
construction of this Agreement. This Agreement may be executed by different
parties on any number of counterparts, each of which shall constitute an
original and all of which, taken together, shall constitute one and the same
agreement.
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Section 10.18. Cumulative Rights and Severability. To the extent
permitted by applicable law, all rights and remedies of the Lenders and Agent
hereunder shall be cumulative and non-exclusive of any rights or remedies such
Persons have under law or otherwise. Any provision hereof that is prohibited or
unenforceable in any jurisdiction shall, in such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and without affecting such provision in any other
jurisdiction.
Section 10.19. Entire Agreement. The Credit Documents constitute
the entire understanding of the parties thereto concerning the subject matter
thereof. Any previous or contemporaneous agreements, whether written or oral,
concerning such matters are superseded thereby.
Section 10.20. Change in Accounting Principles, Fiscal Year or Tax
Laws. If (i) any change in accounting principles from those applicable to
the Borrower as of the date hereof is hereafter occasioned by the promulgation
of rules, regulations, pronouncements and opinions by or required by the
Financial Accounting Standards Board or the American Institute of Certified
Public Accounts (or successors thereto or agencies with similar functions) other
than changes mandated by SFAS 106 and such change materially affects the
calculation of any component of any standard or term found in this Agreement, or
(ii) there is a material change in federal or foreign tax laws which materially
affects the Borrower's ability to comply with the standards or terms found in
this Agreement, the Borrower and the Instructing Group agree to enter into
negotiations in order to amend such provisions so as to equitably reflect such
changes with the desired result that the criteria for evaluating the Borrower's
financial condition shall be the same after such changes as if such changes had
not been made. Unless and until such provisions have been so amended, the
provisions of this Agreement shall govern.
Section 10.21. Officer's Certificates. It is not intended that
any certificate of any officer of the Borrower or Transocean delivered to the
Agent or any Lender pursuant to this Agreement shall give rise to any personal
liability on the part of such officer.
Section 10.22. Effect of Inclusion of Exceptions. It is not
intended that the specification of any exception to any covenant herein shall
imply that the excepted matter would, but for such exception, be prohibited or
required.
Section 10.23. Non-Recourse Obligation. The Obligations of the
Borrower under the Credit Documents shall be non-recourse to Transocean and its
Subsidiaries (excluding the Borrower) other than as expressly provided in the
Operative Documents. No recourse with respect to any Credit Document, any
amount payable or which may be payable by the Borrower under any Credit Document
or any representation, warranty, covenant, obligation, liability or agreement of
the Borrower contained in, made or incurred pursuant to or in any way arising
out of or resulting from any Credit Document (collectively, the "Non-Recourse
Obligations") (including without limitation under any judgment obtained against
the Borrower or by the enforcement of any assessment or by any legal or
equitable proceeding by virtue of any constitution or statute or otherwise or
under any other circumstances) shall be had against any incorporator,
shareholder, Affiliate, director, officer or employee, past, present or future,
of the Borrower (or any Person directly or indirectly controlling any of the
foregoing Persons)
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(collectively, the "Released Persons"), either directly or through the Borrower.
Any and all personal liability of every nature, whether at common law or in
equity or by statute or by constitution or otherwise, of any such Released
Person (i) to respond by reason of any act or omission on its part or otherwise,
for the payment to any Lender, the Agent and/or the Collateral Agent or for or
to the Borrower or any receiver thereof, of any sum that may remain due and
unpaid under or on account of any Non-Recourse Obligation, and (ii) otherwise in
respect of the Non-Recourse Obligations, is hereby expressly waived and released
by the Lenders, the Agent and the Collateral Agent as a condition of and as
consideration for the execution of this Agreement by the Borrower. Nothing in
this Section 10.23 releases Transocean from, or modifies in any respect, any
liability or obligation, past, present or future, of Transocean under the
express terms of any Credit Document to which it is or hereafter becomes a party
(by executing the same).
Section 10.24. Lease Securitization Facility. This Agreement is
part of the "Lease Securitization Facility" referred to in the Secured Credit
Agreement and the other Credit Documents.
Section 10.25. Amoco Quiet Enjoyment; Transocean Replaced Parts.
(a) The Lenders, the Agent and the Collateral Agent each hereby (i) acknowledge
and consent to the provisions of Section 2(h) of each of the O&M Contracts and
Section 7(b) of each of the Transocean Contracts and (ii) agree, for the benefit
of Transocean, that, any term of any Credit Document to the contrary
notwithstanding, unless and until the Collateral Agent shall terminate any such
contract in accordance with its terms, (x) any replaced "Part" (as such term is
defined in such contracts) that, in accordance with the terms of any such
contract, is to become the property of Transocean shall so become the property
of Transocean, free and clear of the Liens of the Security Documents, and (y)
the Collateral Agent shall execute such instruments as Transocean reasonably may
request from time to time to give effect to, or evidence, the release of any
such replaced "Part" from the Liens of the Security Documents.
(b) The Lenders, the Agent and the Collateral Agent each hereby (i)
acknowledge and consent to the provisions of the Amoco Contracts, and (ii)
agree, with respect to each Amoco Contract, that, any term of any Credit
Document to the contrary notwithstanding, during the term of each Amoco Contract
and so long as Amoco shall be in compliance in all material respects with its
obligations set forth in such Amoco Contracts, it shall not take any action
under any Credit Document that would result in any material breach by
"Contractor" under such Amoco Contract or otherwise interfere with Amoco's
rights under such Amoco Contract.
(c) Transocean hereby is constituted as, and each party hereto hereby
agrees that Transocean shall be, an intended third party beneficiary of this
Section 10.25 and, without limitation of the foregoing, any term of this
Agreement to the contrary notwithstanding, this Section 10.25 may not be
amended, modified or supplemented without the written consent of Transocean.
References in this Section 10.25 to Transocean include Transocean Offshore Inc.,
its successors and, with respect to any O&M Contract or Transocean Contract, its
permitted assigns thereunder.
-85-
In Witness Whereof, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
ABN AMRO Bank N.V., as the Agent ABN AMRO Bank N.V., as the Enhancer
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxxxx Xxxxxx
------------------------------------- ---------------------------------
Title: Vice President Title: Vice President
--------------------------------- -----------------------------
By: /s/ Xxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------- ---------------------------------
Title: Group Vice President Title: Group Vice President
--------------------------------- -----------------------------
Address: Structured Finance, Address: Structured Finance,
Asset Securitization Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000 Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Lender Agent- Attention: Enhancer-Amsterdam
Amsterdam Telephone: (000) 000-0000
Telephone: (000) 000-0000 Telecopy: (000) 000-0000
Telecopy: (000) 000-0000
ABN AMRO Bank N.V., with a copy to:
as a Liquidity Provider
ABN AMRO Bank N.V.
Address: Structured Finance,
Asset Securitization
By: /s/ Xxxxxx Xxxxxx 000 Xxxxx XxXxxxx Xxxxxx
------------------------------------------ Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Administrator - Amsterdam
Title: Vice President Telephone: (000) 000-0000
--------------------------------------- Telecopy: (000) 000-0000
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------------
Title: Group Vice President
--------------------------------------
Address: Xxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-86-
AMSTERDAM FUNDING CORPORATION
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Title: President
--------------------------------------
Address: c/o Global Securitization Services, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx,
Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
TRANSOCEAN ENTERPRISE INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Title: Vice President
--------------------------------------
Address: Transocean Enterprise Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
TRANSOCEAN OFFSHORE INC.
Address: Transocean Enterprise Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXXXXXX XXX XXX XXXXXXX BANKING GROUP
LIMITED, as a Liquidity Provider
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------------------------
Title: Director Oil and Gas Americas
-------------------------------------------
Address: 1177 Avenue of the Americas
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXX XXXX XX XXXX XXXXXX, XXXXXXX AGENCY, as a
Liquidity Provider
By: /s/ F.C.H. Xxxxx
------------------------------------------
Title: Senior Manager Loan Operations
Address: Houston Representative Xxxxxx
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXX XX XXXXX - XXXXXXXXXX, LTD., HOUSTON
AGENCY, as a Funding Liquidity Provider
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------------
Title: Vice President and Manager
-----------------------------------
Address: 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXXXXXXXXX XXXXXXXXXX XXXXXXXXXXXX, XXX XXXX
BRANCH,
as a Liquidity Provider
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Title: Managing Director
----------------------------------
By: /s/ Xxxxx Xxxxxxx
-----------------------------------------
Title: Director
----------------------
Address: 1211 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXXXXXXX XXXX-XXX XXXXXXXXXXX AG, NEW YORK
BRANCH, as a Liquidity Provider
By: /s/ Xxxxxx Xxxxxx
----------------------------------------
Title: Director
---------------------------------
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Title: Associate Director
----------------------------------
Address: 000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXXXXX XXXX, XXXXXXX, as a Liquidity Provider
By: /s/ Xxxx X. Xxxxxx, Xx.
------------------------------------------
Title: Vice President
-------------------------------------------
Address: 00 Xxxx Xxxxx
00xx Xxxxx, Xxxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-93-
BANK ONE, NA,
(Main Office Chicago)
as a Liquidity Provider
By: /s/ Xxxxx Xxxxxxxxx
------------------------------------------
Title: First Vice President
-----------------------------------
Address: Xxx Xxxx Xxx Xxxxx, XX0-0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
with a copy to:
000 Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXX XXXX XX XXX XXXX, as a Liquidity Provider
By: /s/ Xxxxx X. Xxxxx
------------------------------------------
Title: Vice President
------------------------------------------
Address: Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXX XXXX XX XXXXXX, as a Liquidity Provider
By: /s/ Xxx X. Xxxxxx
------------------------------------------
Title: Senior Manager
------------------------------------------
Address: 00000 Xxxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Xxxxx Xxxxx
Xxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxx X0X0X0
Attention: Xxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-96-
KBC BANK, N.V., as a Liquidity Provider
By: /s/ Xxxxxx Xxxxxxxx
-------------------------------------------
Title: First Vice President
-------------------------------------
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------
Title: First Vice President
------------------------------------
Address: Two Midtown Plaza, Suite 1759
0000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXX XXXX XX XXXXXXXX, as a Liquidity Provider
By: /s/ Xxxxx Xxxxxx
-----------------------------------------
Title: Vice President
----------------------------------
Address: 00 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXX XXXX XX XXXXX, NATIONAL ASSOCIATION, as a
Liquidity Provider
By: /s/ Ki Xxxxx
-----------------------------------------
Title: Vice President
----------------------------------
Address: 000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Ki Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-99-
EXHIBIT 2.10
TO
SECURED LOAN AGREEMENT
FORM OF NOTE
__________________, ____
For Value Received, the undersigned, Transocean Enterprise Inc., a Delaware
corporation (the "Borrower"), promises to pay to the order of ABN AMRO Bank
N.V., as Agent under the hereinafter defined Loan Agreement (the "Agent"), for
the benefit of the Lenders at the office of the Agent in Chicago, Illinois, in
immediately available funds, the Loans outstanding under the hereinafter defined
Loan Agreement at the times and in the amounts specified on Schedule 2.3 of the
hereinafter defined Loan Agreement, together with interest on the unpaid
principal amount of each Loan from time to time outstanding at the rates, and
payable in the manner and on the dates, specified in the Loan Agreement.
The Agent shall record on its books and records or on the schedule attached
to this Note, which is a part hereof, each Loan made by each Lender to the
Borrower under the Loan Agreement, together with all payments of principal and
interest and the principal balances from time to time outstanding hereon,
whether the Loans are Base Rate Loans, Eurodollar Loans or CP Loans and the
interest rate and Interest Period applicable thereto, provided that prior to the
transfer of this Note all such amounts shall be recorded on the schedule
attached to this Note. The record thereof, whether shown on such books and
records or on the schedule to this Note, shall be prima facie evidence of the
same, provided, however, that the failure of the Agent to record any of the
foregoing or any error in any such record shall not limit or otherwise affect
the obligation of the Borrower to repay all Loans made to it pursuant to the
Loan Agreement together with accrued interest thereon.
This Note is the Note referred to in the Secured Loan Agreement (Amoco
Contracts) dated as of December 21, 1999, between the Borrower, the Agent, and
the Lenders (the "Loan Agreement"), and this Note and the holder hereof are
entitled to all the benefits and security provided for thereby or referred to
therein, to which Loan Agreement reference is hereby made for a statement
thereof. All defined terms used in this Note, except terms otherwise defined
herein, shall have the same meaning as in the Loan Agreement. This Note shall
be governed by and construed in accordance with the internal laws of the State
of New York.
Prepayments may or shall be made hereon and this Note may be declared due
prior to the expressed maturity hereof, all in the events, on the terms and in
the manner as provided for in the Loan Agreement.
To the extent permitted under applicable law, the Borrower hereby waives
demand, presentment, protest or notice of any kind hereunder.
Transocean Enterprise Inc.
By _____________________________________
Its _________________________________
-2-
EXHIBIT 10.8
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment Agreement (this "Agreement") dated as of ________, ____, is
by and among ____________________ (the "Assignor"), ___________________ (the
"Assignee"), Transocean Enterprise Inc., a Delaware corporation (the
"Borrower"), and ABN AMRO Bank N.V., as Agent for the Lenders (as hereinafter
defined) (in such capacity, the "Agent").
W I T N E S S E T H:
Whereas, the Borrower and the Agent have entered into that certain Secured
Loan Agreement (Amoco Contracts) (as amended, supplemented and restated from
time to time, the "Secured Loan Agreement") dated as of December 21, 1999, by
and among the Borrower, the lenders from time to time parties thereto
(collectively, the "Lenders"), Amsterdam Funding Corporation, and the Agent, as
agent for the Lenders;
Whereas, on a pro rata basis, the Assignor proposes to sell and assign to
the Assignee, and the Assignee proposes to buy and accept from the Assignor, a
____ percent (_____%) interest (the "Assigned Interest") in the rights and
obligations of the Assignor under the Credit Documents with the effect that the
Assignee will have a maximum Commitment of $_________, resuling in a Percentage
of _______%;
Whereas, the Assignor has agreed to make certain Loans to the Borrower in
accordance with the terms of the Secured Loan Agreement, with the maximum
aggregate amount of the Assignor's Loans not to exceed the Assignor's
Commitment; and
Now, Therefore, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:
Section 1. Defintions. Any term defined in the Secured Loan
Agreement and used in this Agreement shall have the meaning ascribed to it in
the Secured Loan Agreement. Section 1.1 of the Secured Loan Agreement is hereby
incorporated into this Agreement by reference.
Section 2. Assignment. The Assignor hereby assigns and sells,
without recourse to or warranty by the Assignor except as specifically set forth
herein, to the Assignee the Assigned Interest in the rights and obligations of
the Assignor under the Credit Documents. The Assignee hereby purchases and
accepts, without recourse to or warranty by the Assignor except as specifically
set forth herein, from the Assignor all of such rights and obligations of the
Assignor, including the corresponding portion of the principal amount of the
Loans made by the Assignor. As of the date hereof, the Assignee's Percentage of
the outstanding principal balance of the Loans is $_________. Subject to the
execution and delivery hereof by the Assignor, the Assignee, the Borrower and
the Agent as of the date hereof, (a) the Assignee shall succeed, on a
pro rata basis, to the rights and interests, and be obligated to perform the
obligations, of a Lender under the Credit Documents with a Percentage of
______%, and shall be considered a Lender for all purposes; (b) the Assignee
shall deliver to the Assignor, in immediately available funds, the Assignee's
Percentage of the outstanding Loans, and (c) the Percentage of the Assignor as
of the date hereof shall be reduced by the Percentage acquired by the Assignee,
and the Assignor shall be released from its obligations under the Credit
Documents which have been so assigned to and accepted by the Assignee.
Section 3. Payments. Commitment fees accrued to the date hereof with
respect to the Assignor's Percentage of the Commitment pursuant to Section 2.8
of the Secured Loan Agreement are for the account of the Assignor and such fees
accruing from and including the date hereof with respect to the Assigned
Interest are for the account of the Assignee. All payments of principal of and
accrued interest on the Loans are to be made by the Borrower to the Agent. The
Agent shall divide such payments among the Lenders as their interests may
appear, with all interest accruing on the Loans of the Assignor before the date
hereof to belong to the Assignor. Each of the Assignor and the Assignee hereby
agrees that if it receives any amount from the Borrower under the Credit
Documents which is for the account of the other party hereto, it shall receive
the same for the account of such other party to the extent of such other party's
interest therein and shall promptly pay the same to such other party. The
rights of the Assignor and the Assignee under this Section are in addition to
other rights and remedies which the Assignor or the Assignee may have.
Section 4. Consent of the Borrower and the Agent. This Agreement is
conditioned upon the consent of the Borrower and the Agent to the extent
required by Section 10.8(b) of the Secured Loan Agreement. The execution of
this Agreement by the Borrower and the Agent is evidence of any such consent.
Section 5. The Assignor. The Assignor (a) represents and warrants to
the Assignee that it is the legal and beneficial owner of the Assigned Interest
and that such Assigned Interest is free and clear of any Lien; (b) makes no
representation or warranty and assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Documents or any document
furnished pursuant thereto or (ii) the financial condition of the Borrower or
any other Credit Party or the performance or observance by the Borrower or any
other Credit Party of any of its obligations under the Credit Documents.
Section 6. The Assignee. The Assignee (a) confirms that is has
received a copy of the Credit Documents, together with such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Agreement; (b) agrees that it will, independently
and without reliance upon the Agent, the Assignor or any other Lender and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Documents; (c) appoints and authorizes the Agent to take such action
as agent on behalf of the Assignee and to exercise such powers under the Credit
Documents as are delegated to the Agent by the terms thereof, together with such
power as are reasonably incidental thereto; and (d) agrees that it will
-2-
perform in accordance with their terms all of the obligations which by the terms
of the Credit Documents are required to be performed by it as a Lender. If the
Assignee is organized under the laws of any jurisdiction other than the United
States of America or any State thereof, the Assignee hereby (a) represents to
the Assignor, the Agent and the Borrower that under applicable law and treaties
no taxes will be required to be withheld by the Agent, the Borrower or the
Assignor with respect to any payments to be made to the Assignee in respect of
the Loans, (b) furnishes to the Assignor, the Agent and the Borrower the forms
required by Section 10.8(e) of the Secured Loan Agreement, either U.S. Internal
Revenue Service Form W-8ECI or U.S. Internal Revenue Service Form W-8BEN
(wherein the Assignee claims entitlement to complete exemption from U.S. federal
withholding tax on all interest payments under the Credit Documents), and (c)
agrees for the benefit of the Assignor, the Agent and the Borrower to provide
the Assignor, the Agent and the Borrower from time to time new forms as required
by Section 10.8(e)(iii) and 4.7(b) of the Secured Loan Agreement, and to comply
from time to time with all applicable U.S. laws and regulations with regard to
such withholding tax exemption.
Section 7. Notices and Payment Instructions. All notices in
connection herewith shall be given in accordance with Section 10.2 of the
Secured Loan Agreement. The address of the Assignee for notices hereunder and
thereunder, together with payment instructions for amounts to be paid to the
Assignee under the Secured Loan Agreement, shall be initially as set forth on
the signature pages hereof.
Section 8. Miscellaneous. This Agreement (a) embodies the entire
agreement and understanding between the parties with respect to the subject
matter hereof and supersedes all prior agreements, consents and understandings
relating to such subject matter, (b) is a Credit Document, and (c) shall be
governed by and construed in accordance with the laws of the State of New York.
[The Borrower is hereby agreed to be, and is hereby constituted, an express,
intended third-party beneficiary of this Agreement. Without limitation of the
preceding sentence, this Agreement may not be amended, modified or supplemented
without the written consent of the Borrower, and the Borrower may enforce the
terms hereof as fully as if it were a signatory hereto.]/1/
In Witness Whereof, the parties have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date first above
written.
_________________
/1/ Insert bracketed language if the Borrower's execution hereof is not
required under Section 10.8(b) of the Secured Loan Agreement.
-3-
[NAME OF ASSIGNOR]
By: ________________________________
Name: __________________________
Title: _________________________
[NAME OF ASSIGNEE]
By: ________________________________
Name: __________________________
Title: _________________________
[INSERT ADDRESS]____________________
________________________________
________________________________
Attention: _________________________
Telecopy No.: (___) _______________
Answerback No.: (___) _____________
Telex No.: (___) ___________________
Send payments to:
________________________________
________________________________
________________________________
[REFERENCE: TRANSOCEAN ENTERPRISE INC.]
-4-
[TRANSOCEAN ENTERPRISE INC.]
By: ________________________________
Name: __________________________
Title: _________________________
ABN AMRO Bank N.V., as Agent
By: ________________________________
Name: __________________________
Title: _________________________
By: ________________________________
Name: __________________________
Title: _________________________
-5-
