EXHIBIT 4.6
______________________________________________________________________________
CREDIT AGREEMENT
Dated as of
December 16, 1999
Among
TRANSOCEAN OFFSHORE INC.,
THE LENDERS PARTY HERETO,
SUNTRUST BANK, ATLANTA,
as Xxxxxxxxxxxxxx Xxxxx,
XXXXX XXXX XX XXXXXX,
as Syndication Agent,
BANK OF AMERICA, N.A.,
as Documentation Agent,
And
BANK ONE, NA
And
PARIBAS,
as Senior Managing Agents
______________________________________________________________________________
SUNTRUST EQUITABLE SECURITIES CORPORATION,
as Lead Arranger
CREDIT AGREEMENT (the "Agreement"), dated as of December 16, 1999, among
TRANSOCEAN OFFSHORE INC. (the "Borrower"), a Cayman Islands company, the lenders
from time to time parties hereto (each a "Lender" and collectively, the
"Lenders"), SUNTRUST BANK, ATLANTA ("STBA"), a Georgia banking corporation, as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent"), ROYAL BANK OF CANADA, a bank chartered under the laws of Canada, as
syndication agent for the Lenders (in such capacity, the "Syndication Agent"),
BANK OF AMERICA, N.A., a U.S. national banking association, as documentation
agent for the Lenders (in such capacity, the "Documentation Agent"), and BANK
ONE, NA (Main Office Chicago), a U.S. national banking association, and PARIBAS,
a bank chartered under the laws of France, as senior managing agents for the
Lenders (in such capacity, each a "Senior Managing Agent" and collectively, the
"Senior Managing Agents").
WITNESSETH:
WHEREAS, the Borrower desires to obtain from the Lenders a term loan in the
aggregate principal amount of $400,000,000; and
WHEREAS, the Lenders are willing to make such a term loan to the Borrower
on the terms and subject to the conditions and requirements hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE 1. DEFINITIONS; INTERPRETATION.
Section 1.1. Definitions. Unless otherwise defined herein, the following
terms shall have the following meanings, which meanings shall be equally
applicable to both the singular and plural forms of such terms:
"Adjusted LIBOR" means, for any portions of the Term Loan consisting of
Eurodollar Loans, a rate per annum determined in accordance with the following
formula:
LIBOR Rate
Adjusted LIBOR = ------------------------------------
1.00 - Eurodollar Reserve Percentage
"Administrative Agent" means SunTrust Bank, Atlanta, acting in its capacity
as Administrative Agent for the Lenders, and any successor Administrative Agent
appointed hereunder pursuant to Section 9.7.
"Agreement" means this Credit Agreement, as the same may be amended,
restated and supplemented from time to time.
"Applicable Margin" means, for any day, at such times as a debt rating
(either express or implied) by S&P or Moody's (or in the event that both cease
the issuance of debt ratings generally, such other ratings agency agreed to by
the Borrower and the Administrative Agent) is in effect on the Borrower's senior
unsecured long-term debt, the percentage per annum set forth opposite such debt
rating:
Debt Rating Percentage
----------- ----------
A+/A1 or above 0.350%
A/A2 0.450%
A-/A3 0.550%
BBB+/Baa1 0.700%
BBB/Baa2 0.850%
BBB-/Baa3 1.100%
BB+/Ba1 or below 1.475%
If the ratings issued by S&P and Moody's differ (i) by one rating, the higher
rating shall apply to determine the Applicable Margin, (ii) by two ratings, the
rating which falls between them shall apply to determine the Applicable Margin,
or (iii) by more than two ratings, the rating immediately above the lower of the
two ratings shall apply to determine the Applicable Margin. The Borrower shall
give written notice to the Administrative Agent of any changes to such ratings,
within three (3) Business Days thereof, and any change to the Applicable Margin
shall be effective on the date of the relevant change. Notwithstanding the
foregoing, (i) the Applicable Margin in effect at all times during the first six
months after the Borrowing Date shall in no event be less than a percentage per
annum equal to 0.550%, and (ii) if the Borrower shall at any time fail to have
in effect such a debt rating on the Borrower's senior unsecured long-term debt,
the Borrower shall seek and obtain (if not already in effect), within thirty
(30) days after such debt rating first ceases to be in effect, a corporate
credit rating or a bank loan rating from Moody's or S&P, or both, and the
Applicable Margin shall thereafter be based on such ratings in the same manner
as provided herein with respect to the Borrower's senior unsecured long-term
debt rating (with the Applicable Margin in effect prior to the issuance of such
corporate credit rating or bank loan rating being the same as the Applicable
Margin in effect at the time the senior unsecured long-term debt rating ceases
to be in effect).
"Assignment Agreement" means an agreement in substantially the form of
Exhibit 10.10 whereby a Lender conveys part or all of its Commitment or its
portion of the Term Loan to another Person that is, or thereupon becomes, a
Lender, pursuant to Section 10.10.
"Base Rate" means for any day the greater of:
(i) the fluctuating commercial loan rate announced by the Lender
which is the Administrative Agent from time to time at its Atlanta, Georgia
office (or other corresponding office, in the case of any successor
Administrative Agent) as its base rate for U.S. Dollar loans in the United
States of America in effect on such day (which base rate may not be the lowest
rate charged by such Lender on loans to any of its customers), with any change
in the Base Rate
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resulting from a change in such announced rate to be effective on the date of
the relevant change; and
(ii) the sum of (x) the rate per annum (rounded upwards, if
necessary, to the nearest 1/16th of 1%) equal to the weighted average of the
rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the next Business Day, provided that
(A) if such day is not a Business Day, the rate on such transactions on the
immediately preceding Business Day as so published on the next Business Day
shall apply, and (B) if no such rate is published on such next Business Day, the
rate for such day shall be the average of the offered rates quoted to the
Administrative Agent by two (2) federal funds brokers of recognized standing on
such day for such transactions as selected by the Administrative Agent, plus
(y) a percentage per annum equal to (I) for the period from December 1, 1999
through January 31, 2000, one and one-half percent (1 1/2%) per annum, and (II)
at all other times, one-half of one percent (1/2%) per annum.
"Base Rate Loan" means any portion of the Term Loan bearing interest prior
to maturity at the rate specified in Section 2.6(a).
"Borrower" means Transocean Offshore Inc., a company organized under the
laws of the Cayman Islands, and its successors.
"Borrowing" means any extension of credit made by the Lenders by way of a
portion of the Term Loan, including any Borrowing advanced, continued or
converted. A Borrowing is "advanced" on the day the Lenders advance funds
comprising a portion of the Term Loan to the Borrower, is "continued" (in the
case of Eurodollar Loans) on the date a new Interest Period commences for such
Borrowing, and is "converted" when such Borrowing is changed from one type of
Loan to the other, all as requested by the Borrower pursuant to Section 2.3(a).
"Borrowing Date" means the date on which all conditions precedent set forth
herein to the initial Borrowings have been satisfied or waived in writing and
the funding of the Term Loan hereunder has occurred, which date shall be no
later than January 31,2000.
"Business Day" means any day other than a Saturday or Sunday on which banks
are not authorized or required to close in Atlanta, Georgia, Houston, Texas, or
New York, New York and, if the applicable Business Day relates to the advance or
continuation of, conversion into, or payment on, a Eurodollar Borrowing, on
which banks are dealing in U.S. Dollar deposits in the interbank eurocurrency
market in London, England.
"Capitalized Lease Obligations" means, for any Person, the aggregate 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
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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 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 a market value of 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.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitment" means, relative to any Lender, such Lender's obligations to
fund a portion of the Term Loan pursuant to Section 2.1 in the amount and
percentage set forth opposite its signature hereto or pursuant to Section 10.10,
as such commitment may be reduced from time to time or terminated pursuant to
this Agreement.
"Commitment Fee" means the fee payable to each Lender as provided in
Section 3.1(a).
"Commitment Termination Date" means the earliest of (i) funding of the Term
Loan on the Borrowing Date, and (ii) January 31, 2000.
"Compliance Certificate" means a certificate in the form of Exhibit 6.6.
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of the Borrower dated October 1999, as the same may be
amended, restated and supplemented from time to time and distributed to the
Lenders prior to the Effective Date.
"Consolidated EBITDA" means, for any period, for the Borrower and its
Subsidiaries, the sum of (a) net income or net loss (before discontinued
operations and income or loss resulting from extraordinary items), plus (b) the
sum of (i) Consolidated Interest Expense, (ii) income tax expense, (iii)
depreciation expense, (iv) amortization expense, and (v) other non-cash charges,
all determined in accordance with GAAP on a consolidated basis for the Borrower
and its Subsidiaries (excluding, in the case of the foregoing clauses (a) and
(b), any net income or net loss and expenses and charges of any SPVs or other
Persons that are not Subsidiaries), plus (c) dividends or distributions received
during such period by the Borrower and its Subsidiaries from SPVs and any other
Persons that are not Subsidiaries.
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"Consolidated Indebtedness" means all Indebtedness of the Borrower and its
Subsidiaries that would be reflected on a consolidated balance sheet of such
Persons prepared in accordance with GAAP.
"Consolidated Indebtedness to Total Capitalization Ratio" means, at any
time, the ratio of Consolidated Indebtedness at such time to Total
Capitalization at such time.
"Consolidated Interest Expense" means, for any period, total interest
expense of the Borrower and its Subsidiaries on a consolidated basis for such
period, in connection with Indebtedness, all as determined in accordance with
GAAP, but excluding capitalized interest expense and interest expense
attributable to expected federal income tax settlements.
"Consolidated Net Assets" means, as of any date of determination, an amount
equal to the aggregate book value of the assets of the Borrower, its
Subsidiaries and, to the extent of the equity interest of the Borrower and its
Subsidiaries therein, SPVs at such time, minus the current liabilities of the
Borrower and its Subsidiaries, all as determined on a consolidated basis in
accordance with GAAP.
"Consolidated Net Worth" means, as of any date of determination,
consolidated shareholders equity of the Borrower and its Subsidiaries determined
in accordance with GAAP (but excluding the effect on shareholders equity of
cumulative foreign exchange translation adjustments). For purposes of this
definition, SPVs shall be accounted for pursuant to the equity method of
accounting.
"Controlling Affiliate" means for the Borrower, (i) any other Person that
directly or indirectly through one or more intermediaries controls, or is under
common control with, the Borrower (other than Persons controlled by the
Borrower), and (ii) any other Person owning beneficially or controlling ten
percent (10%) or more of the equity interests in the Borrower. As used in this
definition, "control" means the power, directly or indirectly, to direct or
cause the direction of management or policies of a Person (through ownership of
voting securities or other equity interests, by contract or otherwise).
"Credit Documents" means this Agreement, the Notes, and any Subsidiary
Guaranties in effect from time to time.
"Default" means any event or condition the occurrence of which would, with
the passage of time or the giving of notice, or both, constitute an Event of
Default.
"Documentation Agent" shall mean Bank of America, N.A., in its capacity as
Documentation Agent for the Lenders, and any successor Documentation Agent
appointed pursuant to Section 9.7; provided, however, that no such Documentation
Agent shall have any duties, responsibilities, or obligations hereunder in such
capacity.
"Dollar" and "U.S. Dollar" and the sign "$" mean lawful money of the United
States of America.
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"Effective Date" means the date this Agreement shall become effective as
defined in Section 10.16.
"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 ("Claims") or any permit issued under any Environmental Law,
including, without limitation, (i) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
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 or local statute, law, rule,
regulation, ordinance, code, policy or rule of common law now or hereafter in
effect, including any judicial or administrative order, consent, decree or
judgment, relating to the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Eurodollar Loan" means a portion of the Term Loan bearing interest before
maturity at the rate specified in Section 2.6(b).
"Eurodollar Reserve Percentage" means, with respect to each Interest Period
for a Eurodollar Loan, a percentage (expressed as a decimal) equal to the daily
average during such Interest Period of the percentages 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
which prescribes reserve requirements applicable to "Eurocurrency Liabilities"
as presently defined in Regulation D.
"Event of Default" means any of the events or circumstances specified in
Section 7.1.
"Foreign Plan" means any pension, profit sharing, deferred compensation, or
other employee benefit plan, program or arrangement maintained by any foreign
Subsidiary of the Borrower which, under applicable local law, is required to be
funded through a trust or other funding vehicle, but shall not include any
benefit provided by a foreign government or its agencies.
"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
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pronouncements of the Financial Accounting Standards Board or in such other
statements, opinions and pronouncements by such other entity as may be approved
by a significant segment of the U.S. accounting profession.
"Guarantor" means any Subsidiary of the Borrower required to execute and
delivery a Subsidiary Guaranty hereunder pursuant to Section 6.12, in each case
unless and until the relevant Subsidiary Guaranty is released pursuant to
Section 6.12.
"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 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 to purchase any
property or assets constituting security therefor, primarily for the purpose of
assuring the owner of such Indebtedness of the ability of the primary obligor to
make payment of such Indebtedness; or (ii) to advance or supply funds (x) for
the purchase or payment of such Indebtedness, 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, in each case primarily
for the purpose of assuring the owner of such Indebtedness of the ability of the
primary obligor to make payment of such Indebtedness; 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 of the ability of the primary obligor to make payment of such
Indebtedness; or (iv) otherwise to assure the owner of such Indebtedness 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 Indebtedness shall be deemed to be equal to the amount that would apply if
such Indebtedness was 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 the Guaranty.
"Hazardous Material" shall have 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 petroleum, including crude oil or any fraction thereof, or any
other substance defined as "hazardous" or "toxic" or words with similar meaning
and effect under any Environmental Law applicable to the Borrower or any of its
Subsidiaries.
"Highest Lawful Rate" means the maximum nonusurious interest rate, if any,
that any time or from time to time may be contracted for, taken, reserved,
charged or received on any portions of the Term Loan, under laws applicable to
any of the Lenders which are presently in effect or, to the extent allowed by
applicable law, under such laws which may hereafter be in effect and which allow
a higher maximum nonusurious interest rate than applicable laws now allow.
Determination of the rate of interest for the purpose of determining whether any
portions of the Loan are usurious under all applicable laws shall be made by
amortizing, prorating, allocating, and spreading, in equal parts during the
period of the full stated term of the Term Loan, all interest at any time
contracted for, taken, reserved, charged or received from the Borrower in
connection with the Term Loan.
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"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 and accrued liabilities 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 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 securing Indebtedness;
(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 Interest Rate Protection
Agreements, and (vii) obligations of such Person pursuant to a Guaranty of any
of the foregoing obligations of another Person; provided, however, Indebtedness
shall exclude Non-recourse Debt. 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.
"Interest Coverage Ratio" means, as of the end of any fiscal quarter, the
ratio of (i) Consolidated EBITDA for the four fiscal quarter period then ended,
minus all dividends paid to shareholders of the Borrower during such four fiscal
quarter period and all cash income taxes paid during such four fiscal quarter
period, to (ii) Consolidated Interest Expense for the four fiscal quarter period
then ended. In any four fiscal quarter period for which the Interest Coverage
Ratio is being determined which includes the fiscal quarter during which the
Sedco Forex Merger occurred, Consolidated EBITDA and Consolidated Interest
Expense for those fiscal quarters included in such period ending on or before
December 31, 1999 shall be for the Borrower and its Subsidiaries as existing
prior to the Sedco Forex Merger and, in addition, if the Sedco Forex Merger
shall occur on or after April 1, 2000, Consolidated EBITDA and Consolidated
Interest Expense for the fiscal quarter ending March 31, 2000 shall also be for
the Borrower and its Subsidiaries as existing prior to the Sedco Forex Merger.
Other fiscal quarters during any such four-quarter period shall be for the
Borrower and its Subsidiaries as existing after consummation of the Sedco Forex
Merger.
"Interest Payment Date" means (i) for each Base Rate Loan, the last
Business Day of each calendar quarter during which such Loan is outstanding,
whether during all or any portion of such calendar quarter, and (ii) for each
Eurodollar Loan, the last Business Day of each Interest Period for such Loan
and, during any Interest Period of six (6) months, the next Business Day
occurring three (3) months after the commencement of such Interest Period.
"Interest Period" means the period commencing on the date that a Borrowing
of Eurodollar Loans is advanced, continued or created by conversion and, subject
to Section 2.4, ending on the date 1, 2, 3 or 6 months thereafter as selected by
the Borrower pursuant to the terms of this Agreement.
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"Interest Rate Protection Agreement" shall mean 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.
"Lead Arranger" means SunTrust Equitable Securities Corporation, acting in
its capacity as lead arranger for the Term Loan.
"Lender" is defined in the preamble.
"Lending Office" means the branch, office or affiliate of a Lender
specified on the appropriate signature page hereof, or designated pursuant to
Sections 8.4 or 10.10, as the office through which it will make its portion of
the Term Loan hereunder for each type of Loan available hereunder.
"LIBOR Rate" means, relative to any Interest Period for each Eurodollar
Loan comprising part of the same Borrowing, a rate of interest per annum
(rounded upwards, if necessary, to the nearest whole multiple of 1/16 of 1%),
equal to the arithmetic mean of the "LIBOR" rates of interest per annum
appearing on Telerate Page 3750 (or any successor publication) for Dollars two
(2) Business Days before the commencement of such Interest Period for delivery
on the first day of such Interest Period, at or about 11:00 a.m. (London,
England time) for a period approximately equal to such Interest 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
Administrative 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 Administrative Agent after consultation with
the Borrower.
"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.
"Loan" mean a Base Rate Loan or Eurodollar Loan, each of which is a "type"
of Loan hereunder, outstanding as a portion of the Term Loan.
"Material Adverse Effect" means a material adverse effect on (i) the
business, assets, operations or condition of the Borrower and its Subsidiaries
taken as a whole, or (ii) the Borrower's ability to perform any of its payment
obligations under the Agreement or the Notes.
"Maturity Date" means the fifth anniversary of the Borrowing Date.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor thereto.
"Non-recourse Debt" means with respect to any Person (i) obligations of
such Person against which the obligee has no recourse to such Person except as
to certain named or described
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present or future assets or interests, and (ii) the obligations of SPVs to the
extent the obligee thereof has no recourse to the Borrower or any of its
Subsidiaries.
"Note" means any of the promissory notes of the Borrower defined in Section
2.10.
"Obligations" means all obligations of the Borrower to pay fees, costs and
expenses hereunder, to pay principal or interest on the Term Loan, and to pay
any other obligations to the Administrative Agent or any Lender arising under
any Credit Document.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Percentage" means, for each Lender, prior to funding of the Term Loan, the
percentage of the Commitments represented by such Lender's Commitment, and on
and after the funding of the Term Loan, the percentage of the Term Loan held by
such Lender.
"Performance Guaranties" means all Guaranties of the Borrower or any of its
Subsidiaries delivered in connection with the construction financing of drill
ships, offshore mobile drilling units or offshore drilling rigs for which firm
drilling contracts have been obtained by the Borrower, any of its Subsidiaries
or a SPV.
"Performance Letters of Credit" means all letters of credit for the account
of the Borrower, any Subsidiary or a SPV issued as support for Non-recourse Debt
or a Performance Guaranty.
"Permitted Business" has the meaning ascribed to such term in Section 6.8.
"Permitted Liens" means the Liens permitted as described in Section 6.11.
"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 any of its Subsidiaries, 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 or any of its Subsidiaries 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.
"Principal Payment Date" shall have the meaning set forth in Section 2.5.
"Required Lenders" means, prior to funding of the Term Loan, Lenders then
holding in the aggregate at least fifty-one percent (51%) of the Commitments,
and on and after funding of the Term Loan, Lenders then holding portions of the
Term Loan representing in the aggregate at least fifty-one percent (51%) of the
total principal amount of the Term Loan then outstanding.
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"Reuters Screen" means, when used in connection with any designated page
and the "LIBOR" rate, the display page so designated on the Reuter Money 2000
Service (or such other page as may replace that page on that service or on any
replacement Reuter Service for the purpose of displaying rates comparable to the
"LIBOR" rate).
"Sale-Leaseback Transaction" means any arrangement whereby the Borrower or
a Subsidiary shall sell or transfer any property, real or personal, used or
useful in its business, whether now owned or hereafter acquired, and thereafter
rent or lease property that it intends to use for substantially the same purpose
or purposes as the property sold or transferred.
"Schlumberger" means Schlumberger Limited, a company incorporated in the
Netherlands Antilles.
"SEC" means the Securities and Exchange Commission.
"Sedco Forex" means Sedco Forex Holdings Limited, a wholly owned Subsidiary
of Schlumberger under which the offshore contract drilling business of
Schlumberger is to be consolidated prior to the Sedco Forex Distribution as
described in the Transocean Schlumberger Joint Proxy Statement.
"Sedco Forex Distribution" means the distribution of the capital stock of
Sedco Forex to the shareholders of Schlumberger pursuant to the Sedco Forex
Distribution Agreement.
"Sedco Forex Distribution Agreement" means the distribution agreement dated
as of July 12, 1999, between Schlumberger and Sedco Forex, as the same may be
amended, restated or supplemented from time to time.
"Sedco Forex Merger" means the merger of Sedco Forex and Sedco Forex Merger
Sub, pursuant to which Sedco Forex and the Subsidiaries of Sedco Forex shall
become wholly owned Subsidiaries of the Borrower as described in the Transocean
Schlumberger Joint Proxy Statement.
"Sedco Forex Merger Agreement" means the merger agreement dated as of July
12, 1999, among the Borrower, Sedco Forex Merger Sub, Schlumberger, and Sedco
Forex, as the same may be amended, restated or supplemented from time to time.
"Sedco Forex Merger Sub" means Transocean SF Limited, a wholly owned
Subsidiary of the Borrower that will merge with and into Sedco Forex, with Sedco
Forex surviving as a wholly owned Subsidiary of the Borrower.
"Senior Managing Agents" means each of Bank One, NA (Main Office Chicago)
and Paribas in their capacities as senior managing agents for the Lenders, and
any successor senior managing agents appointed pursuant to Section 9.7;
provided, however, that no such senior managing agents shall have any duties,
responsibilities, or obligations hereunder in such capacities.
11
"S&P" means Standard & Poor's Ratings Group or any successor thereto.
"SPV" means any Person that is designated by the Borrower as a SPV,
provided that the Borrower shall not designate as a SPV any Subsidiary that
owns, directly or indirectly, any other Subsidiary that has total assets
(including assets of any Subsidiaries of such other Subsidiary, but excluding
any assets that would be eliminated in consolidation with the Borrower and its
Subsidiaries) which equates to at least five percent (5%) of the Borrower's
Total Assets, or that had net income (including net income of any Subsidiaries
of such other Subsidiary, all before discontinued operations and income or loss
resulting from extraordinary items, all determined in accordance with GAAP, but
excluding revenues and expenses that would be eliminated in consolidation with
the Borrower and its Subsidiaries) during the most recently completed fiscal
year of the Borrower in excess of the greater of (i) $1,000,000, and
(ii) fifteen percent (15%) of the net income (before discontinued operations and
income or loss resulting from extraordinary items) for the Borrower and its
Subsidiaries, all as determined on a consolidated basis in accordance with GAAP
during such fiscal year of the Borrower. The Borrower may elect to treat any
Subsidiary as a SPV (provided such Subsidiary would otherwise qualify as such),
and may rescind any such prior election, by giving written notice thereof to the
Administrative Agent specifying the name of such Subsidiary or SPV, as the case
may be, and the effective date of such election, which shall be a date within
sixty (60) days after the date such notice is given. The election to treat a
particular Person as a SPV may only be made once.
"Significant Subsidiary" has the meaning ascribed to it under Regulation
S-X promulgated under the Securities Exchange Act of 1934, as amended.
"Subsidiary" means, for any Person, any other Person (other than, except in
the context of Section 6.6(a), a SPV) 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.
"Subsidiary Debt Basket Amount" has the meaning ascribed to such term in
Section 6.12(i).
"Subsidiary Guaranty" means any Guaranty of any Subsidiary delivered
pursuant to Section 6.12(j).
"Syndication Agent" shall mean Royal Bank of Canada, acting in its capacity
as Syndication Agent for the Lenders, and any successor Syndication Agent
appointed hereunder pursuant to Section 9.7; provided, however, that no such
Syndication Agent shall have any duties, responsibilities, or obligations
hereunder in such capacity.
"Taxes" has the meaning set forth in Section 5.12.
12
"Telerate" means, when used in connection with any designated page and the
"LIBOR" rate, the display page so designated on the Dow Xxxxx Telerate Service
(or such other page as may replace that page on that service or on any
replacement Dow Xxxxx Service for the purpose of displaying rates comparable to
the "LIBOR" rate).
"Term Loan" means the $400,000,000 principal amount term loan made by the
Lenders to the Borrower pursuant to Section 2.1.
"Total Assets" means, as of any date of determination, the aggregate book
value of the assets of the Borrower and its Subsidiaries determined on a
consolidated basis in accordance with GAAP as of such date.
"Total Capitalization" means, as of any date of determination, the sum of
Consolidated Indebtedness plus Consolidated Net Worth as of such date.
"Transocean Schlumberger Joint Proxy Statement" means the joint proxy
statement/prospectus of the Borrower and Schlumberger dated October 27, 1999, as
the same may be amended or supplemented from time to time.
"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 or any of its Subsidiaries to the PBGC or such Plan.
Section 1.2. Interpretation. The foregoing definitions shall be equally
applicable to the singular and plural forms of the terms defined. All references
to times of day in this Agreement shall be references to New York, New York time
unless otherwise specifically provided.
Section 1.3. Sedco Forex and Subsidiaries. Except as otherwise expressly
provided herein, references in this Agreement and the other Credit Documents to
any Subsidiary or Subsidiaries of the Borrower shall, from and after the time of
the Sedco Forex Merger, be deemed to include and refer to Sedco Forex and any
Subsidiaries of Sedco Forex, but shall not be deemed to include or refer to
Sedco Forex or any of its Subsidiaries prior to the Sedco Forex Merger.
13
ARTICLE 2. THE TERM LOAN FACILITY.
Section 2.1. Borrowing of the Term Loan . Subject to the terms and
conditions hereof, each Lender severally and not jointly agrees to make to the
Borrower on the Borrowing Date a portion of the Term Loan in an aggregate
principal amount equal to its Commitment. Funding of the Term Loan may be by one
or more Borrowings as provided in Sections 2.2 and 2.3. Each Borrowing in
respect of the Term Loan shall be made ratably from the Lenders in proportion to
their respective Percentages. Amounts paid or prepaid in respect of the Term
Loan may not be reborrowed.
Section 2.2. Types of Loans and Minimum Borrowing Amounts . Borrowings in
respect of the Term Loan may be outstanding as either Base Rate Loans or
Eurodollar Loans, as selected by the Borrower pursuant to Section 2.3. Each
Borrowing of Base Rate Loans shall be in an amount of not less than $1,000,000
and each Borrowing of Eurodollar Loans shall be in an amount of not less than
$10,000,000.
Section 2.3. Manner of Borrowing.
(a) Notice to the Administrative Agent. The Borrower shall give notice to
the Administrative Agent by no later than 12:00 p.m. (i) at least three (3)
Business Days before the Borrowing Date, with respect to those portions of the
Term Loan to be funded with a Borrowing or Borrowings of Eurodollar Loans, and
(ii) at least one (1) Business Day before the Borrowing Date, with respect to
any portions of the Term Loan to be funded with a Borrowing of Base Rate Loans,
in each case pursuant to a duly executed Borrowing Request substantially in the
form of Exhibit 2.3 (a "Borrowing Request"). The Loans included in each
Borrowing shall bear interest initially at the type of rate specified in the
Borrowing Request with respect to such Borrowing. Thereafter, the Borrower may
from time to time elect to change or continue the type of interest rate borne by
each Borrowing or, subject to the minimum amount requirement for each
outstanding Borrowing as set forth in Section 2.2, a portion thereof, as
follows: (i) if such Borrowing is of Eurodollar Loans, the Borrower may continue
part or all of such Borrowing as Eurodollar Loans for an Interest Period
specified by the Borrower or convert part or all of such Borrowing into Base
Rate Loans on the last day of the Interest Period applicable thereto, or the
Borrower may earlier convert part or all of such Borrowing into Base Rate Loans
so long as it pays the breakage fees and funding losses provided in Section
2.11; and (ii) if such Borrowing is of Base Rate Loans, the Borrower may convert
all or part of such Borrowing into Eurodollar Loans for an Interest Period
specified by the Borrower on any Business Day. The Borrower may select multiple
Interest Periods for the Eurodollar Loans constituting any particular Borrowing,
provided that at no time shall the number of different Interest Periods for
outstanding Eurodollar Loans exceed eight (it being understood for such purposes
that (x) Interest Periods of the same duration, but commencing on different
dates, shall be counted as different Interest Periods and (y) all Interest
Periods commencing on the same date and of the same duration shall be counted as
one Interest Period regardless of the number of Borrowings or Eurodollar Loans
involved). Notices of the continuation of a Borrowing of Eurodollar Loans for an
additional Interest Period or of the conversion of part or all of a Borrowing of
Eurodollar Loans into Base Rate Loans or of Base Rate Loans into Eurodollar
Loans must be given by no later than 12:00 p.m. at least three
14
(3) Business Days before the date of the requested continuation or conversion.
The Borrower shall give such notices concerning the continuation or conversion
of a Borrowing by telephone or facsimile (which notice shall be irrevocable once
given and, if by telephone, shall be promptly confirmed in writing) pursuant to
a Borrowing Request which shall specify the date of the requested continuation
or conversion (which shall be a Business Day), the amount of the affected
Borrowing, the type of Loans to comprise such continued or converted Borrowing
and, if such Borrowing is to be comprised of Eurodollar Loans, the Interest
Period applicable thereto. The Borrower agrees that the Administrative Agent may
rely on any such telephonic or facsimile notice given by any person it in good
faith believes is an authorized representative of the Borrower without the
necessity of independent investigation and that, if any such notice by telephone
conflicts with any written confirmation, such telephonic notice shall govern if
the Administrative Agent has acted in reliance thereon.
(b) Notice to the Lenders. The Administrative Agent shall give prompt
telephonic, telex or facsimile notice to each Lender of any notice received
pursuant to Section 2.3(a) relating to a Borrowing. The Administrative Agent
shall give notice to the Borrower and each Lender by like means of the interest
rate applicable to each Borrowing of Eurodollar Loans (but, if such notice is
given by telephone, the Administrative Agent shall confirm such rate in writing)
promptly after the Administrative Agent has made such determination.
(c) Borrower's Failure to Notify. If the Borrower fails to give notice
pursuant to Section 2.3(a) of the continuation or conversion of any outstanding
principal amount of a Borrowing of Eurodollar Loans, and has not notified the
Administrative Agent by 12:00 p.m. at least three (3) Business Days before the
last day of the Interest Period for any Borrowing of Eurodollar Loans that it
intends to continue or convert such Borrowing, the Borrower shall be deemed to
have requested the continuation of such Borrowing as a Eurodollar Loan with an
Interest Period of one (1) month, so long as no Event of Default shall have
occurred and be continuing or would occur as a result of such Borrowing. Upon
the occurrence and during the continuance of any Event of Default, each
Eurodollar Loan will automatically, on the last day of the then existing
Interest Period therefor, convert into a Base Rate Loan.
(d) Disbursement of Loans. Not later than 12:00 p.m. with respect to
Eurodollar Loans, and not later than 1:00 p.m. with respect to Base Rate Loans
on the Borrowing Date each Lender, subject to all other provisions hereof, shall
make available its Loan comprising its ratable share of such Borrowing in funds
immediately available in Atlanta, Georgia for the benefit of the Administrative
Agent and according to the disbursement instructions of the Administrative
Agent. The Administrative Agent shall make the proceeds of each such Borrowing
available in immediately available funds to the Borrower (or as directed in
writing by Borrower) on such date. In the event that any Lender does not make
such amounts available to the Administrative Agent by the time prescribed above,
but such amount is received later that day, such amount may be credited to the
Borrower in the manner described in the preceding sentence on the next Business
Day (with interest on such amount to begin accruing hereunder on such next
Business Day) provided that acceptance by the Borrower of any such late amount
shall not be deemed a waiver by the Borrower of any rights it may have against
such Lender. No Lender shall be responsible to the Borrower for any failure by
another Lender to fund its portion
15
of a Borrowing, and no such failure by a Lender shall relieve any other Lender
from its obligation, if any, to fund its portion of a Borrowing.
(e) Administrative Agent Reliance on Lender Funding. Unless the
Administrative Agent shall have been notified by a Lender before the Borrowing
Date (which notice shall be effective upon receipt) that such Lender does not
intend to make such payment, the Administrative Agent may assume that such
Lender has made such payment when due and in reliance upon such assumption may
(but shall not be required to) make available to the Borrower the proceeds of
the Loans to be made by such Lender and, if any Lender has not in fact made such
payment to the Administrative Agent, such Lender shall, on demand, pay to the
Administrative Agent the amount made available to the Borrower attributable to
such Lender together with interest thereon for each day during the period
commencing on the date such amount was made available to the Borrower and ending
on (but excluding) the date such Lender pays such amount to the Administrative
Agent at a rate per annum equal to the Administrative Agent's cost of funds. If
such amount is not received from such Lender by the Administrative Agent
immediately upon demand, the Borrower will, on demand, repay to the
Administrative Agent the proceeds of the Loans attributable to such Lender with
interest thereon at a rate per annum equal to the interest rates applicable to
the relevant Loans, but the Borrower shall in no event be liable for breakage
fees pursuant to Section 2.11 in connection with such repayment. Nothing in this
subsection shall be deemed to relieve any Lender from its obligation to fund its
Commitment hereunder or to prejudice any rights which the Borrower may have
against any Lender as a result of any default by such Lender hereunder.
(f) Conversion. If the Borrower shall elect to convert any particular
Borrowing from one Type of Loan to the other only in part, then, from and after
the date on which such conversion shall be effective, such particular Borrowing
shall, for all purposes of this Agreement (including, without limitation, for
purposes of subsequent application of this sentence) be deemed to instead
constitute two Borrowings (each originally initiated on the same date as such
particular Borrowing), one comprised of (subject to subsequent conversion in
accordance with this Agreement) Eurodollar Loans in an aggregate principal
amount equal to the portion of such Borrowing so elected by the Borrower to be
comprised of Eurodollar Loans and the second comprised of (subject to subsequent
conversion in accordance with this Agreement) Base Rate Loans in an aggregate
principal amount equal to the portion of such particular Borrowing so elected by
the Borrower to be comprised of Base Rate Loans. If the Borrower shall elect to
have multiple Interest Periods apply to any particular Borrowing comprised of
Eurodollar Loans, then, from and after the date such multiple Interest Periods
commence, such particular Borrowing shall, for all purposes of this Agreement
(including, without limitation, for purposes of subsequent application of this
sentence), be deemed to constitute a number of separate Borrowings (each
originally advanced on the same date as such particular Borrowing) equal to the
number of, and corresponding to, the different Interest Periods so elected, each
such deemed separate Borrowing corresponding to a particular selected Interest
Period comprised of (subject to subsequent conversion in accordance with this
Agreement) Eurodollar Loans in an aggregate principal amount equal to the
portion of such particular Borrowing so elected by the Borrower to have such
Interest Period. This Section 2.3(f) shall be applied appropriately in the event
that the Borrower shall make the elections described in the two preceding
sentences at the same time with respect to the same particular Borrowing.
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Section 2.4. Interest Periods . As provided in Section 2.3(a), at the time
of each request for the advance or continuation of, or conversion into, a
Borrowing of Eurodollar Loans, the Borrower shall select an Interest Period
applicable to such Loans from among the available options subject to the
limitations in Section 2.3(a); provided, however, that:
(i) the Borrower may not select an Interest Period for a Borrowing of
Loans that extends beyond the Maturity Date;
(ii) no Interest Period shall extend beyond any Principal Payment Date
unless the aggregate principal amount of Base Rate Loans, and Eurodollar
Loans that have Interest Periods which will expire on or before the
Principal Payment Date, is equal to or in excess of the amount of any such
principal amount required to be paid on the Principal Payment Date;
(iii) 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
either be (i) extended to the next succeeding Business Day, or (ii) reduced
to the immediately preceding Business Day if the next succeeding Business
Day is in the next calendar month; and
(iv) for purposes of determining an Interest Period, 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 such numerically corresponding day in the
month in which an Interest Period is to end or if 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.
Section 2.5. Repayment of the Term Loan. The Borrower shall repay the
principal amount of the Term Loan in full in twelve (12) consecutive quarterly
principal payments, such payments to commence twenty-seven (27) months following
the Borrowing Date, and continuing every three (3) months thereafter, with the
final principal payment being due and payable on the Maturity Date (each such
payment being due on the same calendar day of the month as the Borrowing Date,
and each such quarterly payment date being referred to herein as a "Principal
Payment Date"). The first four (4) such quarterly payments in respect of the
Term Loan shall each be in a principal amount equal to $25,000,000; and the
remaining eight (8) such quarterly payments shall each be in the principal
amount of $37,500,000. Any other unpaid principal amounts in respect of the
Term Loan, and any interest thereon, and any fees, expenses, or other
Obligations then outstanding under the Credit Documents shall be due and payable
in full on the Maturity Date.
Section 2.6. Applicable Interest Rates; Interest Payments.
(a) Base Rate Loans. Each Base Rate Loan shall bear interest (computed on
the basis of a 365 or 366-day year and actual days elapsed excluding the date of
repayment) on the unpaid principal amount thereof from the date such Loan is
made until maturity (whether by
17
acceleration or otherwise) or conversion to a Eurodollar Loan, at a rate per
annum equal to the lesser of (i) the Highest Lawful Rate, or (ii) the Base Rate
from time to time in effect.
(b) Eurodollar Loans. Each Eurodollar Loan 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 Loan is
made until maturity (whether by acceleration or otherwise) or conversion to a
Base Rate Loan at a rate per annum equal to the lesser of (i) the Highest Lawful
Rate, or (ii) the sum of Adjusted LIBOR plus the Applicable Margin.
(c) Rate Determinations. The Administrative Agent shall determine each
interest rate applicable to the Eurodollar Loans hereunder insofar as such
interest rate involves a determination of Adjusted LIBOR and such determination
shall be conclusive and binding except in the case of the Administrative Agent's
manifest error or willful misconduct. The Administrative Agent shall promptly
give notice to the Borrower and each Lender of each determination of Adjusted
LIBOR with respect to each Eurodollar Loan.
(d) Interest Payments. The Borrower shall pay interest on all outstanding
Base Rate Loans and Eurodollar Loans comprising the Term Loan on the respective
Interest Payment Dates for such Base Rate Loans and Eurodollar Loans, upon the
conversion of any Eurodollar Loans to Base Rate Loans, and at maturity (whether
by acceleration or otherwise).
Section 2.7. Default Rate. If any payment of principal on the Term Loan is
not made when due after the expiration of the grace period therefor provided in
Section 7.1(a) (whether by acceleration or otherwise), such principal amount
shall bear interest (computed on the basis of a year of 360, 365 or 366 days, as
applicable, and actual days elapsed) after such grace period expires until such
principal amount then due is paid in full, payable on demand, at a rate per
annum equal to:
(a) for any Base Rate Loan the lesser of (i) the Highest Lawful Rate, or
(ii) 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
the time such payment was due); and
(b) for any Eurodollar Loan the lesser of (i) the Highest Lawful Rate, or
(ii) 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 Loan 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
the time such payment was due).
It is the intention of the Administrative Agent and the Lenders to conform
strictly to usury laws applicable to them. Accordingly, if the transactions
contemplated hereby or the Loans would be usurious as to any of the Lenders
under laws applicable to it (including the laws of the United States of America
and the State of New York or any other jurisdiction whose laws may be
mandatorily applicable to such Lender notwithstanding the other provisions of
this Agreement, the Notes or any other Credit Document), then, in that event,
notwithstanding anything to the
18
contrary in this Agreement, the Notes or any other Credit Document, it is agreed
as follows: (i) the aggregate of all consideration which constitutes interest
under laws applicable to such Lender that is contracted for, taken, reserved,
charged or received by such Lender under this Agreement, the Notes or any other
Credit Document or otherwise shall under no circumstances exceed the Highest
Lawful Rate, and any excess shall be credited by such Lender on the principal
amount of the Notes (or, if the principal amount of the Notes shall have been
paid in full, refunded by such Lender to the Borrower); and (ii) in the event
that the maturity of the Notes is accelerated by reason of an election of the
holder or holders thereof resulting from any Event of Default hereunder or
otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest under laws applicable to such Lender may
never include more than the Highest Lawful Rate, and excess interest, if any,
provided for in this Agreement, the Notes, any other Credit Document or
otherwise shall be automatically canceled by such Lender as of the date of such
acceleration or prepayment and, if theretofore paid, shall be credited by such
Lender on the principal amount of the Notes (or if the principal amount of the
Notes shall have been paid in full, refunded by such Lender to the Borrower). To
the extent that the Texas Finance Code is relevant to the Administrative Agent
and the Lenders for the purpose of determining the Highest Lawful Rate, the
Administrative Agent and the Lenders hereby elect to determine the applicable
rate ceiling under such Article by the weekly rate ceiling from time to time in
effect, subject to their right subsequently to change such method in accordance
with applicable law. In the event the Loans are paid in full by the Borrower
prior to the full stated term of the Term Loan and the interest received for the
actual period of the existence of the Term Loan exceeds the Highest Lawful Rate,
the Lenders shall refund to the Borrower the amount of the excess or shall
credit the amount of the excess against amounts owing under the Term Loan or
otherwise in respect of the Obligations, and none of the Administrative Agent or
the Lenders shall be subject to any of the penalties provided by law for
contracting for, taking, reserving, charging or receiving interest in excess of
the Highest Lawful Rate.
Section 2.8. Optional Prepayments. The Borrower shall have the privilege
of prepaying Base Rate Loans 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); provided, however, that the
Borrower shall have given notice of such prepayment to the Administrative Agent
not less than three (3) Business Days prior to the date of such prepayment. The
Borrower shall have the privilege of prepaying Eurodollar Loans (a) 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) only on the last Business Day of an
Interest Period for such Loan, and (b) at any other time so long as the breakage
fees and funding losses provided for in Section 2.11 are paid; provided,
however, that the Borrower shall have given notice of such prepayment to the
Administrative Agent not less than three (3) Business Days prior to the last
Business Day of such Interest Period or the proposed prepayment date. Any such
prepayments shall be made by the payment of the principal amount to be prepaid
and accrued and unpaid interest thereon to the date of such prepayment.
Prepayments of principal shall be applied pro rata to the principal payments
thereafter remaining to be paid as set forth in Section 2.5.
Section 2.9. Mandatory Prepayment of Term Loan. If funding of the Term Loan
occurs prior to the time of the Sedco Forex Merger, and the Sedco Forex Merger
has not been consummated as provided in the Sedco Forex Merger Agreement prior
to April 30, 2000, then
19
the Borrower shall prepay in full the entire outstanding principal amount of the
Term Loan on May 1, 2000, together with all interest accrued and unpaid thereon
(including payment of all breakage fees and funding losses provided for in
Section 2.11), and all fees, expense reimbursements, indemnity payments, and
other Obligations then outstanding under this Agreement and the other Credit
Documents. Except for the foregoing amounts, such prepayment shall be made by
the Borrower without penalty or premium.
Section 2.10. The Notes.
(a) The portion of the Term Loan outstanding to the Borrower from each
Lender shall be evidenced by a promissory note of the Borrower payable to such
Lender in the form of Exhibits 2.10 (each a "Note").
(b) Each holder of a Note shall record on its books and records or on a
schedule to its appropriate Note (and prior to any transfer of its Notes shall
endorse thereon or on schedules forming a part thereof appropriate notations to
evidence) the amount of each Loan outstanding from it to the Borrower, all
payments of principal and interest and the principal balance from time to time
outstanding thereon, the type of such Loan and, if a Eurodollar Loan, the
Interest Period and interest rate applicable thereto. Such record, whether shown
on the books and records of a holder of a Note or on a schedule to its Note,
shall be prima facie evidence as to all such matters; provided, however, that
the failure of any holder 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. At the request of any holder of a Note and upon such holder tendering
to the Borrower the Note to be replaced, the Borrower shall furnish a new Note
to such holder to replace any outstanding Note and at such time the first
notation appearing on the schedule on the reverse side of, or attached to, such
new Note shall set forth the aggregate unpaid principal amount of all Loans, if
any, then outstanding thereon.
Section 2.11. Breakage Fees. If any Lender incurs any loss, cost or
expense (excluding loss of anticipated profits and other indirect or
consequential damages) by reason of the liquidation or re-employment of deposits
or other funds acquired by such Lender to fund or maintain any Eurodollar Loan
as a result of any of the following events (other than any such occurrence as a
result of a change of circumstance described in Sections 8.1 or 8.2):
(a) any payment, prepayment or conversion of a Eurodollar Loan on a
date other than the last day of its Interest Period (whether by
acceleration, mandatory or optional prepayment or otherwise);
(b) any failure to make a principal payment of a Eurodollar Loan on
the due date therefor; or
(c) any failure by the Borrower to borrow, continue or prepay, or
convert to, a Eurodollar Loan on the date specified in a notice given
pursuant to Section 2.3(a) (other than by reason of a default of such
Lender),
20
then the Borrower shall pay to such Lender such amount as will reimburse such
Lender for such loss, cost or expense. If any Lender makes such a claim for
compensation, it shall provide to the Borrower a certificate executed by an
officer of such Lender setting forth the amount of such loss, cost or expense in
reasonable detail (including an explanation of the basis for and the computation
of such loss, cost or expense) no later than ninety (90) days after the event
giving rise to the claim for compensation, and the amounts shown on such
certificate shall be prima facie evidence of such Lender's entitlement thereto.
Within ten (10) days of receipt of such certificate, the Borrower shall pay
directly to such Lender such amount as will compensate such Lender for such
loss, cost or expense as provided herein, unless such Lender has failed to
timely give notice to the Borrower of such claim for compensation as provided
herein, in which event the Borrower shall not have any obligation to pay such
claim.
ARTICLE 3. FEES AND PAYMENTS.
Section 3.1. Fees.
(a) Commitment Fees. The Borrower shall pay to the Administrative Agent,
for the ratable benefit of each Lender, a commitment fee on such Lender's
Commitment, calculated at the rate of 0.125% per annum for the period commencing
on the fourteenth (14th) day after the Effective Date and ending on the day
prior to the earlier of (i) the Borrowing Date, and (ii) the Commitment
Termination Date, at which time all such commitment fees shall be due and
payable in full.
(b) Administrative Agent Fees. The Borrower shall pay to the Administrative
Agent the fees from time to time agreed to by the Borrower and the
Administrative Agent.
Section 3.2. Place and Application of Payments.
(a) All payments of principal of and interest on the Loans and of all other
amounts payable by the Borrower under the Credit Documents shall be made by the
Borrower to the Administrative Agent by no later than 2:30 p.m. on the due date
thereof at the office of the Administrative Agent in Atlanta, Georgia (or such
other location in the United States as the Administrative Agent may designate to
the Borrower) for the benefit of the Lenders entitled to such payments. Any
payments received by the Administrative Agent from the Borrower after 2:30 p.m.
shall be deemed to have been received on the next Business Day. The
Administrative Agent will, on the same day each payment is received or deemed to
have been received in accordance with this Section 3.2, cause to be distributed
like funds to each Lender owed an Obligation for which such payment was
received, pro rata based on the respective amounts of such type of Obligation
then owing to each Lender.
(b) If any payment received by the Administrative Agent under any Credit
Document is insufficient to pay in full all amounts then due and payable to the
Administrative Agent and the Lenders under the Credit Documents, such payment
shall be distributed by the Administrative Agent and applied by the
Administrative Agent and the Lenders in the order set forth in Section 7.5. In
calculating the amount of Obligations owing each Lender other than for principal
and interest on the Loans and fees under Section 3.1, the Administrative Agent
shall
21
only be required to include such other Obligations that Lenders have certified
to the Administrative Agent in writing are due to such Lenders.
Section 3.3. Withholding Taxes.
(a) Payments Free of Withholding. Except as otherwise required by law, each
payment by the Borrower to any Lender or the Administrative 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 is incorporated, any jurisdiction from which the Borrower
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
Administrative Agent, the following taxes:
(i) taxes imposed on, based upon, or measured by its net income or
profits, and branch profits, franchise, and similar taxes imposed on it;
(ii) taxes imposed on it as a result of a present or former connection
between the taxing jurisdiction and such Lender or the Administrative
Agent, or any affiliate thereof, as the case may be, other than a
connection resulting solely from the transactions contemplated by this
Agreement;
(iii) taxes 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 8.3(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) taxes imposed by the United States of America (or any political
subdivision thereof or tax authority therein) upon a Lender organized under
the laws of a jurisdiction outside of the United States, except to the
extent that such tax is imposed 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 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 Purchasing Lender (as
defined in Section 10.10), after the date on which it becomes a Lender; or
(v) taxes which would not have been imposed but for (a) the failure of
any Lender or the Administrative Agent, as the case may be, to provide
(I) an Internal Revenue Service Form 1001 or 4224, as the case may be,
or any substitute or successor form prescribed by the Internal Revenue
Service, pursuant to Section 3.3(b), or (II) 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 Administrative Agent to establish an exemption from such
tax is false;
22
(all such present or future taxes, excluding only the taxes described in the
preceding clauses (i) through (v), being hereinafter referred to as "Indemnified
Taxes"). If any such withholding is so required, the Borrower 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 Administrative Agent is free and clear
of any Indemnified Taxes (including Indemnified Taxes on such additional amount)
and is equal to the amount that such Lender or the Administrative Agent (as the
case may be) would have received had withholding of any Indemnified Taxes not
been made. If the Borrower pays any Indemnified Taxes, or any penalties or
interest in connection therewith, it shall deliver official tax receipts
evidencing the payment or certified copies thereof, or other evidence of payment
if such tax receipts have not yet been received by the Borrower (with such tax
receipts to be delivered within fifteen (15) days after being actually
received), to the Lender or Administrative Agent on whose account such
withholding was made (with a copy to the Administrative Agent if not the
recipient of the original) within fifteen (15) days of such payment. If the
Administrative Agent or any Lender pays any Indemnified Taxes, or any penalties
or interest in connection therewith, upon the Borrower's failure to withhold and
pay such Indemnified Taxes, penalties or interest, Borrower shall reimburse the
Administrative Agent or that Lender for the payment on demand in the currency in
which such payment was made. The Administrative Agent or such Lender shall make
written demand on the Borrower for reimbursement hereunder no later than ninety
(90) days after the earlier of (i) the date on which such Lender or the
Administrative Agent makes payment of the Indemnified Taxes, penalties or
interest, and (ii) the date on which the relevant taxing authority or other
governmental authority makes written demand upon such Lender or the
Administrative Agent for payment of the Indemnified Taxes, penalties or
interest. Any such demand shall describe in reasonable detail such Indemnified
Taxes, penalties or interest, including the amount thereof if then known to such
Lender or the Administrative Agent, as the case may be. In the event that such
Lender or the Administrative Agent fails to give the Borrower timely notice as
provided herein, the Borrower shall not have any obligation to pay such claim
for reimbursement.
(b) U.S. Withholding Tax Exemptions. Upon the request of the Borrower or
the Administrative Agent, 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 Administrative Agent, promptly after written request from the
Borrower, two duly completed and signed copies of either Form 1001 (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 4224 (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 Administrative Agent 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 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 such a United States person.
23
(c) Inability of Lender to Submit Forms. If any Lender determines in good
faith, as a result of any change in applicable law, regulation or treaty, or in
any official application or interpretation thereof, that (i) it is unable to
submit to the Borrower or Administrative Agent any form or certificate that such
Lender is obligated to submit pursuant to subsection (b) of this Section 3.3,
(ii) it is required to withdraw or cancel any such form or certificate
previously submitted, or (iii) any such form or certificate otherwise becomes
ineffective or inaccurate, such Lender shall promptly notify the Borrower and
Administrative Agent of such fact and the 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 Administrative Agent receives a
refund of any Indemnified Tax or any tax referred to in Section 10.3 with
respect to which the Borrower has paid any amount pursuant to this Section 3.3
or Section 10.3, such Lender or the Administrative Agent shall pay the amount of
such refund (including any interest received with respect thereto) to the
Borrower within fifteen (15) days after receipt thereof. A Lender or the
Administrative Agent shall provide, at the sole cost and expense of the
Borrower, such assistance as the Borrower may reasonably request in order to
obtain such a refund; provided, however, that neither the Administrative Agent
nor any Lender shall in any event be required to disclose any information to the
Borrower with respect to the overall tax position of the Administrative Agent or
such Lender.
ARTICLE 4. CONDITIONS PRECEDENT.
Section 4.1. Initial Borrowing. The obligation of each Lender to advance
its portion of the Term Loan hereunder on the Borrowing Date is subject to the
satisfaction of the following requirements and conditions precedent:
(a) The Administrative Agent shall have received the following, all in form
and substance reasonably satisfactory to the Administrative Agent (which shall
be evidenced by the making of such Term Loan) all in sufficient number of signed
counterparts, where applicable, to provide one for each Lender (except for the
Notes, of which only one original shall be signed for each Lender):
(i) Notes. The duly executed Notes of the Borrower;
(ii) Certificates of Officers. Certificates of the Secretary or
Assistant Secretary of the Borrower containing specimen signatures of the
persons authorized to execute Credit Documents on the Borrower's behalf or
any other documents provided for herein or therein, together with (x)
copies of resolutions of the Board of Directors or other appropriate body
of the Borrower authorizing the execution and delivery of the Credit
Documents, (y) copies of the Borrower's Memorandum and Articles of
Association and other publicly filed organizational documents in its
jurisdiction of organization and bylaws and other governing documents, and
(z) a certificate of incorporation and good standing from the appropriate
governing agency of the Borrower's jurisdiction of organization;
24
(iii) Regulatory Filings and Approvals. Copies of all necessary
governmental and third party approvals, registrations, and filings in
respect of the transactions contemplated by this Agreement and, if the
Sedco Forex Merger has been consummated on or prior to the Borrowing Date,
in respect of the transactions contemplated by the Sedco Forex Merger
Agreement, together with evidence that any waiting periods in respect of
any of the foregoing shall have expired or terminated, in each case without
any action being taken by any competent authority that restrains, prevents
or imposes materially adverse conditions on the consummation of the Sedco
Forex Merger;
(iv) Insurance Certificate. An insurance certificate dated not more
than ten (10) days prior to the Borrowing Date from the Borrower describing
in reasonable detail the insurance maintained by the Borrower and its
Subsidiaries as required by this Agreement;
(v) Borrowing Request. The Borrowing Request required by Section
2.3(a);
(vi) Opinions of Counsel. The opinions of (x) Xxxxx & Xxxxx, counsel
for the Borrower, in the form of Exhibit 4.1A, (y) Xxxxxxx X. Xxxxxxx,
Associate General Counsel of the Borrower, in the form of Exhibit 4.1B, and
(z) Walkers, Cayman Islands counsel for the Borrower, in the form of
Exhibit 4.1C;
(vii) Closing Certificate. Certificate of the President or a Vice
President of the Borrower as to the satisfaction of all conditions set
forth in this Section 4.1, including without limitation, where the Sedco
Forex Merger has occurred on or prior to the Borrowing Date, consummation
of the Sedco Forex Merger on substantially the terms as set forth in the
Sedco Forex Merger Agreement and in the proxy statements submitted to the
shareholders of the Borrower and Schlumberger/Sedco Forex in respect of
such transaction; and
(viii) Escrow Agreement. If the Borrowing Date occurs prior to the Sedco
Forex Merger, the escrow agreement as described in Section 4.2.
(b) Each of the representations and warranties of the Borrower and its
Subsidiaries (which representations and warranties shall, if the Sedco Forex
Merger has occurred on or prior to the Borrowing Date, be deemed to include and
refer to Sedco Forex and its Subsidiaries) set forth herein and in the other
Credit Documents shall be true and correct in all material respects as of the
time of such Borrowing, except to the extent that any such representation or
warranty relates solely to an earlier date, in which case it shall have been
true and correct in all material respects as of such earlier date;
(c) No Default or Event of Default shall have occurred and be continuing or
would occur as a result of such Borrowing;
(d) There shall be no pending or, to the knowledge of the Borrower,
threatened actions, suits or proceedings at law or in equity or by or before any
governmental authority
25
against or affecting the Borrower or any of its Subsidiaries or any of their
respective businesses, properties or rights which, if adversely determined,
could reasonably be expected to result in a Material Adverse Effect;
(e) There shall not exist or have occurred any change in the financial
condition, results of operations, business, assets, or operations of the
Borrower and its Subsidiaries, taken as a whole, which could reasonably be
expected to result in a Material Adverse Effect; and
(f) Payment of all fees and all expenses incurred through the Effective
Date then due and owing to the Administrative Agent, the Lenders, and the Lead
Arranger pursuant to this Agreement and as otherwise agreed in writing by the
Borrower.
The acceptance by the Borrower of the proceeds of the Term Loan (whether or not
such proceeds are then subject to being released to the Borrower pursuant to
Section 4.2) shall be deemed to be a representation and warranty by the Borrower
on the date of such Borrowing that all conditions precedent to such Borrowing
set forth in this Section 4.1 with respect to the Borrowing hereunder have
(except to the extent waived in accordance with the terms hereof) been satisfied
or fulfilled unless the Borrower gives to the Lenders written notice to the
contrary, in which case none of the Lenders shall be required to fund any
portion of the Term Loan unless the Required Lenders (or, if required pursuant
to Section 10.11, all the Lenders) shall have previously waived in writing such
non-compliance.
Section 4.2. Funding of Term Loan Prior to Sedco Forex Merger; Release of
Term Loan Proceeds . If the Borrowing Date occurs prior to the Sedco Forex
Merger, that portion of the Term Loan proceeds to be used by the Borrower for
the purposes of refinancing Indebtedness of Sedco Forex and its Subsidiaries
promptly after consummation of the Sedco Forex Merger, as specified by the
Borrower in the Borrowing Request described in Section 4.1(a)(v), shall be
funded into an escrow arrangement with the Administrative Agent in accordance
with the terms of an escrow agreement in the form of Exhibit 4.2 attached
hereto. All such Term Loan proceeds shall be deemed funded by the Lenders to the
Borrower on the Borrowing Date and shall bear interest from and after the
Borrowing Date at the rates, and shall be payable at the times, specified
herein. All such Term Loan proceeds shall be held pursuant to such escrow
arrangement, shall be held or invested in cash or Cash Equivalents during the
term of such escrow arrangement, and shall be subject to release from such
escrow arrangement to the Borrower on or after December 29, 1999, upon
satisfaction of the following terms and conditions:
(a) The Administrative Agent shall have received copies of all governmental
and third party approvals, registrations, and consents necessary to consummate
the Sedco Forex Merger, together with evidence that any waiting periods in
respect thereof shall have expired or terminated, other than the passage of time
to the effective date of the Sedco Forex Merger set forth in the articles of
merger filed with the appropriate governmental authority in the British Virgin
Islands, in each case without any action then having been taken by any competent
authority that restrains, prevents or imposes materially adverse conditions on
the consummation of the Sedco Forex Merger;
26
(b) The shareholders of Schlumberger shall have approved the Sedco Forex
Distribution and the shareholders of the Borrower shall have approved the Sedco
Forex Merger, in each case as described in the terms of the Transocean
Schlumberger Joint Proxy Statement, and the articles of merger in respect of the
merger of Sedco Forex and Sedco Forex Merger Sub shall have been filed in the
appropriate government office of the British Virgin Islands without conditions
to the effectiveness thereof other than the passage of time to the effective
date of the Sedco Forex Merger;
(c) The Sedco Forex Merger is then scheduled to occur within the two
Business Days immediately following the date of the requested release of the
escrowed funds;
(d) Each of the representations and warranties of the Borrower and its
Subsidiaries (which representations and warranties shall be deemed to include
and refer to Sedco Forex and its Subsidiaries with the same effect as if the
Sedco Forex Merger had been consummated immediately prior to such time) set
forth herein and in the other Credit Documents shall be true and correct in all
material respects as of the time of such requested release of such Term Loan
proceeds, except to the extent that any such representation or warranty relates
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) The Administrative Agent shall have received a Certificate of the
President or Vice President of the Borrower as to the satisfaction of all
conditions set forth in this Section 4.2, and that the Sedco Forex Merger
Agreement has not been terminated and remains in force and effect.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to each Lender and the Administrative
Agent as follows:
Section 5.1. Corporate Organization . The Borrower and each of its material
Subsidiaries: (i) is duly organized and existing in good standing under the laws
of the jurisdiction of its organization; (ii) has all necessary company power
and authority to own the property and assets it uses in its business and
otherwise to carry on its present business; 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, except where the failure to be
so licensed or qualified or to be in good standing, as the case may be, would
not have a Material Adverse Effect.
Section 5.2. Power and Authority; Validity . The Borrower has the
organizational power and authority to execute, deliver and carry out the terms
and provisions of the Credit Documents and has taken all necessary company
action to authorize the execution, delivery and performance of such Credit
Documents. The Borrower has duly executed and delivered each Credit Document
and each such Credit Document constitutes the legal, valid and binding
obligation of the Borrower enforceable against it in accordance with its terms,
subject as to
27
enforcement only to bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally and
equitable principles.
Section 5.3. No Violation. Neither the execution, delivery or performance
by the Borrower of the Credit Documents nor compliance by it with the terms and
provisions thereof, nor the consummation by it of the transactions contemplated
herein or therein, will (i) 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,
(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 the Borrower or any of its
Subsidiaries under, the terms of any material contractual obligation to which
the Borrower or any of its Subsidiaries is a party or by which they or any of
their properties or assets are bound or to which they may be subject, or
(iii) violate or conflict with any provision of the Memorandum and Articles of
Association, charter, articles or certificate of incorporation, partnership or
limited liability company agreement, by-laws, or other applicable governance
documents of the Borrower or any of its Subsidiaries.
Section 5.4. Litigation. There are no actions, suits, proceedings or
counterclaims (including, without limitation, derivative or injunctive actions)
pending or, to the knowledge of the Borrower, threatened against the Borrower or
any of its Subsidiaries that are reasonably likely to have a Material Adverse
Effect.
Section 5.5. Use of Proceeds; Margin Regulations.
(a) The proceeds of the Term Loan shall only be used (i) to refinance
Indebtedness of Sedco Forex and its Subsidiaries promptly after consummation of
the Sedco Forex Merger, and (ii) for general corporate purposes of the Borrower
and its Subsidiaries.
(b) Neither the Borrower nor any of its Subsidiaries is engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock. No proceeds of the Term Loan will be used for a purpose which violates
Regulations T, U or X of the Board of Governors of the Federal Reserve System.
After application of the proceeds of the Term Loan and any acquisitions
permitted hereunder, less than 25% of the assets of each of the Borrower and its
Subsidiaries consists of "margin stock" (as defined in Regulation U of the Board
of Governors of the Federal Reserve System).
Section 5.6. Investment Company Act . Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
Section 5.7. Public Utility Holding Company Act . Neither the Borrower nor
any of its Subsidiaries is 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.
28
Section 5.8. True and Complete Disclosure. All factual information (taken
as a whole) furnished by the Borrower or any of its Subsidiaries in writing to
the Administrative Agent or any Lender in connection with any Credit Document or
the Confidential Information Memorandum or any transaction contemplated therein
did not, as of the date such information was furnished (or, if such information
expressly related to a specific date, as of such specific date), contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein (taken as a whole), in light of the circumstances
under which such information was furnished, not misleading, except for such
statements, if any, as have been updated, corrected, supplemented, superseded or
modified pursuant to a written correction or supplement furnished to the Lenders
prior to the date of this Agreement.
Section 5.9. Financial Statements.
(a) The financial statements heretofore delivered to the Lenders for the
Borrower's fiscal year ending December 31, 1998, and for the Borrower's fiscal
quarter and year-to-date period ending September 30, 1999, have been prepared in
accordance with GAAP applied on a basis consistent, except as otherwise noted
therein, with the Borrower's financial statements for the previous fiscal year.
Such annual and quarterly financial statements fairly present on a consolidated
basis the financial position of the Borrower as of the dates thereof, and the
results of operations for the periods indicated, subject in the case of interim
financial statements, to normal year-end audit adjustments and omission of
certain footnotes (as permitted by the SEC). As of the Effective Date, the
Borrower and its Subsidiaries, considered as a whole, had no material contingent
liabilities or material Indebtedness required under GAAP to be disclosed in a
consolidated balance sheet of the Borrower that were not disclosed in the
financial statements referred to in this Section 5.9(a) or in the notes thereto
or disclosed in writing to the Administrative Agent (with a request to the
Administrative Agent to distribute such disclosure to the Lenders).
(b) The Borrower has heretofore delivered to the Lenders audited combined
financial statements for Sedco Forex and its Subsidiaries as of the dates and
for the periods ended December 31, 1996, December 31, 1997, and December 31,
1998, and unaudited combined financial statements for Sedco Forex and its
Subsidiaries as of and for the six month periods ended June 30, 1998 and June
30, 1999 (the "Sedco Forex Historical Financial Statements"). To the best of the
Borrower's knowledge and belief, the Sedco Forex Historical Financial Statements
(i) have been prepared in accordance with GAAP consistently applied throughout
the periods presented, and (ii) fairly present in all material respects the
combined assets, liabilities, financial position, results of operations and cash
flows of Sedco Forex and its Subsidiaries as of the dates and for the periods
indicated, subject in the case of interim financial statements to normal year-
end audit adjustments and omission of certain footnotes (as permitted by the
SEC).
Section 5.10. No Material Adverse Change. There has occurred no event or
effect that has had or could reasonably be expected to have a Material Adverse
Effect.
Section 5.11. Labor Controversies. There are no labor controversies pending
or, to the best knowledge of the Borrower, threatened against the Borrower or
any of its Subsidiaries that could reasonably be expected to have a Material
Adverse Effect.
29
Section 5.12. Taxes. The Borrower and its Subsidiaries have filed 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 have paid 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 and its Subsidiaries or any
of their properties (other than any such assessments, fees, charges or levies
that are not more than ninety (90) days past due, or 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,
or which the failure to pay could not reasonably be expected to have a Material
Adverse Effect).
Section 5.13. ERISA. With respect to each Plan, the Borrower and its
Subsidiaries have fulfilled their obligations under the minimum funding
standards of, and are in compliance in all material respects with, ERISA and
with the Code to the extent applicable to it, and have not incurred any
liability under Title IV of ERISA to the PBGC other than a liability to the PBGC
for premiums under Section 4007 of ERISA, except as described in Schedule 5.13
and in each case with such exceptions as could not reasonably be expected to
have a Material Adverse Effect. As of the Effective Date, neither the Borrower
nor any of its Subsidiaries has any material contingent liability with respect
to any post-retirement benefits under a welfare plan subject to ERISA, other
than liability for continuation coverage described in Part 6 of Title I of ERISA
and as disclosed in the financial statements of the Borrower for the fiscal
quarter ending September 30, 1999, described in Section 5.9(a), or any other
liability that could not reasonably be expected to have a Material Adverse
Effect.
Section 5.14. Year 2000. The Borrower has reviewed the areas within its
business and operations, and the business and operations of its Subsidiaries
that could reasonably be expected to be materially and adversely affected by,
and 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 the
Borrower and its Subsidiaries and SPVs 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 "Year 2000 Problem" could not reasonably be expected
to have a Material Adverse Effect. The foregoing statement constitutes "year
2000 readiness disclosure" as such term is defined in the Year 2000 Information
and Readiness Disclosure Act.
Section 5.15. Consents. On the Borrowing Date, 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 in order to borrow the Term Loan hereunder have
been or will have been obtained or made and are or will be in full force and
effect.
Section 5.16. Insurance. The Borrower and its material Subsidiaries
currently maintain in effect, with responsible insurance companies, insurance
against any loss or damage to all insurable property and assets owned by it,
which insurance is of a character and in or in excess of
30
such amounts as are customarily maintained by companies similarly situated and
operating like property or assets (subject to self-insured retentions and
deductibles), and insurance with respect to employers' and public and product
liability risks (subject to self-insured retentions and deductibles).
Section 5.17. Intellectual Property. The Borrower and its Subsidiaries own
or hold valid licenses to use all the patents, trademarks, permits, service
marks, and trade names that are necessary to the operation of the business of
the Borrower and its Subsidiaries as presently conducted, except where the
failure to own, or hold valid licenses to use, such patents, trademarks,
permits, service marks, and trade names could not reasonably be expected to have
a Material Adverse Effect.
Section 5.18. Ownership of Property. The Borrower and its Subsidiaries have
good title to or a valid leasehold interest in all of their real property and
good title to, or a valid leasehold interest in, all of their other property,
subject to no Liens except Permitted Liens, except where the failure to have
such title or leasehold interest in such property could not reasonably be
expected to have a Material Adverse Effect.
Section 5.19. Compliance with Statutes, Etc. The Borrower and its
Subsidiaries are in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic and foreign, in respect of the conduct of their businesses and the
ownership of their properties, except for such instances of non-compliance as
could not reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect.
Section 5.20. Environmental Matters.
(a) Except as described in Schedule 5.20, the Borrower and its Subsidiaries
are 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 as could not reasonably be expected 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 or any of its Subsidiaries
on any property owned or operated by the Borrower or any of its Subsidiaries
except as described in Schedule 5.20 or except as could not reasonably be
expected 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 any of its Subsidiaries or on any property adjoining
or in the vicinity of any such property that could reasonably be expected to
form the basis of an Environmental Claim against the Borrower or any of its
Subsidiaries or any such property that individually or in the aggregate could
reasonably be expected to have a Material Adverse Effect.
(b) 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 or any of its Subsidiaries
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 or any of
31
its Subsidiaries, in the case of both (i) and (ii), with such exceptions as
could not reasonably be expected to have a Material Adverse Effect.
Section 5.21. Existing Indebtedness. Schedule 5.21 contains a complete and
accurate list of all Indebtedness outstanding as of the Effective Date, both
with respect to the Borrower and its Subsidiaries and, to the best of the
Borrower's knowledge and belief, with respect to Sedco Forex and its
Subsidiaries after giving effect to the Sedco Forex Distribution, in a principal
amount of $20,000,000 or more (other than the Obligations hereunder and
Indebtedness permitted by Section 6.12(b) through (k)) and permitted by Section
6.12(a), in each case showing the aggregate principal amount thereof, the name
of the respective borrower and any other entity which directly or indirectly
guaranteed such Indebtedness, and the scheduled payments of such Indebtedness.
Section 5.22. Existing Subsidiary Restrictions. Schedule 5.22 contains a
complete and accurate list of all contractual restrictions in effect on the
Effective Date, both with respect to the Borrower and its Subsidiaries and, to
the best of the Borrower's knowledge and belief, with respect to Sedco Forex and
its Subsidiaries after giving effect to the Sedco Forex Distribution,
restricting or impairing the ability of any Subsidiaries of the Borrower, or
Sedco Forex or any Subsidiaries of Sedco Forex, to (i) pay dividends or make any
other distributions to the Borrower or any of its Subsidiaries, SPVs or
Affiliates on the Borrower's or such Subsidiary's capital stock, partnership or
limited liability company interests, or other equity or ownership interests, as
the case may be, or any other interest or participation in its profits, (ii) pay
any Indebtedness owed to the Borrower or any of its Subsidiaries, or (iii) make
loans or advances to the Borrower or any of its Subsidiaries, in each case where
any such restriction restricts or impairs the payment or making of such
distributions, dividends, loans, interests or participations in profits, or
payments of Indebtedness (other than restrictions permitted by Section 6.9(b)
through (m)) and permitted by Section 6.9(a), in each case showing the aggregate
amount so restricted or impaired, the name of the Person subject to such
restrictions, and the basis for and terms of such restriction.
Section 5.23. Existing Liens . Schedule 5.23 contains a complete and
accurate list of all Liens outstanding as of the Effective Date, both with
respect to the Borrower and its Subsidiaries and, to the best of the Borrower's
knowledge and belief, with respect to Sedco Forex and its Subsidiaries after
giving effect to the Sedco Forex Distribution, where the Indebtedness or other
obligations secured by such Lien is in a principal amount of $20,000,000 or more
(other than the Liens permitted by Section 6.11(b) through (r)), and permitted
by Section 6.11(a), in each case showing the name of the Person whose assets are
subject to such Lien, the aggregate principal amount of the Indebtedness secured
thereby, and a description of the Agreements or other instruments creating,
granting, or otherwise giving rise to such Lien.
ARTICLE 6. COVENANTS.
The Borrower covenants and agrees that, so long as any Note or Commitment
is outstanding hereunder, or any other Obligation is due and payable hereunder:
32
Section 6.1. Corporate Existence. Each of the Borrower and its material
Subsidiaries will preserve and maintain its organizational existence, except (i)
for the dissolution of any material Subsidiaries whose assets are transferred to
the Borrower or any of its Subsidiaries, (ii) where the failure to preserve,
renew or keep in full force and effect the existence of any Subsidiary could not
reasonably be expected to have a Material Adverse Effect, or (iii) as otherwise
expressly permitted in this Agreement.
Section 6.2. Maintenance. Each of the Borrower and its material
Subsidiaries will maintain, preserve and keep its properties and equipment
necessary to the proper conduct of its business in reasonably good repair,
working order and condition (normal wear and tear excepted) and will from time
to time make all reasonably necessary repairs, renewals, replacements, additions
and betterments thereto so that at all times such properties and equipment are
reasonably preserved and maintained, in each case with such exceptions as could
not, individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect; provided, however, that nothing in this Section 6.2 shall
prevent the Borrower or any material Subsidiary from discontinuing the operation
or maintenance of any such properties or equipment if such discontinuance is, in
the judgment of the Borrower or any material Subsidiary, as applicable,
desirable in the conduct of their businesses.
Section 6.3. Taxes. Each of the Borrower and its Subsidiaries will duly
pay and discharge all Taxes upon or against it or its properties before
penalties accrue thereon (or, if later, within ninety (90) days of becoming past
due), unless and to the extent that (i) the same is being contested in good
faith and by appropriate proceedings and reserves have been established in
conformity with GAAP, or (ii) the failure to effect such payment or discharge
could not reasonably be expected to have a Material Adverse Effect.
Section 6.4. ERISA. Each of the Borrower and its Subsidiaries 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 or any material Subsidiary and will
promptly notify the Administrative 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 a multi-employer plan, as
defined in ERISA), so long as the event thereunder could reasonably be expected
to have a Material Adverse Effect, 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) Borrower's or any of its Subsidiaries' intention to
terminate or withdraw from any Plan if such termination or withdrawal would
result in liability under Title IV of ERISA, unless such termination or
withdrawal could not reasonably be expected to have a Material Adverse Effect;
and (iv) the receipt by the Borrower or its Subsidiaries of notice of the
occurrence of any event that could reasonably be expected to result in the
incurrence of any liability (other than for benefits), fine or penalty to the
Borrower and/or to the Borrower's Subsidiaries, or any plan amendment that could
reasonably be expected to increase the contingent liability of the Borrower and
its Subsidiaries, taken as a whole, in connection with any post-retirement
benefit under a welfare plan (subject to ERISA), unless such event or amendment
could not reasonably be expected to have a Material Adverse Effect. The Borrower
will also promptly notify the Administrative Agent of (i) any
33
material contributions to any Foreign Plan that have not been made by the
required due date for such contribution if such default could reasonably be
expected to have a Material Adverse Effect; (ii) any Foreign Plan that is not
funded to the extent required by the law of the jurisdiction whose law governs
such Foreign Plan based on the actuarial assumptions reasonably used at any time
if such underfunding (together with any penalties likely to result) could
reasonably be expected to have a Material Adverse Effect, and (iii) any material
change anticipated to any Foreign Plan that could reasonably be expected to have
a Material Adverse Effect.
Section 6.5. Insurance. Each of the Borrower and its material Subsidiaries
will maintain or cause to be maintained, with responsible insurance companies,
insurance against any loss or damage to all insurable property and assets owned
by it, such insurance to be of a character and in or in excess of such amounts
as are customarily maintained by companies similarly situated and operating like
property or assets (subject to self-insured retentions and deductibles) and will
(subject to self-insured retentions and deductibles) maintain or cause to be
maintained insurance with respect to employers' and public and product liability
risks.
Section 6.6. Financial Reports and Other Information.
(a) The Borrower, its Subsidiaries and any SPVs 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, its Subsidiaries and any SPVs as any Lender may
reasonably request; and, without any request, will furnish to the Administrative
Agent:
(i) within sixty (60) days after the end of each of the first three
(3) fiscal quarters of each fiscal year of the Borrower, the consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such
fiscal quarter and the related consolidated 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 or in the form filed with the
SEC, and certified by the chief financial officer of the Borrower that they
fairly present the financial condition of the Borrower and its Subsidiaries
as of the dates indicated and the results of their operations and changes
in their 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 any footnotes as permitted by the SEC
(delivery to the Administrative Agent of a copy of the Borrower's Form 10-Q
filed with the SEC (without exhibits) in any event will satisfy the
requirements of this subsection subject to Section 6.6(b));
(ii) within one hundred twenty (120) days after the end of each fiscal
year of the Borrower, the consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of such fiscal year and the related
consolidated 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 fiscal year, audited by an independent
34
nationally-recognized accounting firm and in the form filed with the SEC
(delivery to the Administrative Agent of a copy of the Borrower's Form 10-K
filed with the SEC (without exhibits) in any event will satisfy the
requirements of this subsection subject to Section 6.6(b));
(iii) commencing with fiscal year 2000, to the extent actually prepared
and approved by the Borrower's board of directors, a projection of
Borrower's consolidated balance sheet and consolidated income, retained
earnings and cash flows for its current fiscal year showing such projected
budget for each fiscal quarter of the Borrower ending during such year; and
(iv) within ten (10) days after the sending or filing thereof, copies
of all financial statements, projections, documents and other
communications that the Borrower sends to its stockholders generally or
files with the SEC or any similar governmental authority (and is publicly
available).
The Administrative Agent will forward promptly to the Lenders the information
provided by the Borrower pursuant to (i) through (iv) above.
(b) Each financial statement furnished to the Lenders pursuant to
subsections (i) and (ii) of Section 6.6(a) shall be (i) accompanied by
additional information setting forth calculations excluding the effects of any
SPVs and containing such calculations for any SPVs as reasonably requested by
the Administrative Agent, and (ii) accompanied by (x) 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, to the effect that no Default or
Event of Default then exists or, if any such Default or Event of Default exists
as of the date of such certificate, setting forth a description of such Default
or Event of Default and specifying the action, if any, taken by the Borrower to
remedy the same, and (y) a Compliance Certificate in the form of Exhibit 6.6
showing the Borrower's compliance with certain of the covenants set forth
herein.
(c) Promptly upon receipt thereof, the Borrower will provide the
Administrative Agent with a copy of each report or "management letter" submitted
to the Borrower, any of its material Subsidiaries or any SPVs 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, any of its material
Subsidiaries or any SPVs.
(d) Promptly after any officer of the Borrower obtains knowledge of any of
the following, the Borrower will provide the Administrative Agent with written
notice in reasonable detail of any of the following that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect:
(i) any pending or threatened Environmental Claim against the
Borrower, any of its Subsidiaries or any SPV or any property owned or
operated by the Borrower, any of its Subsidiaries or any SPV;
35
(ii) any condition or occurrence on any property owned or operated by
the Borrower, any of its Subsidiaries or any SPV that results in
noncompliance by the Borrower, any of its Subsidiaries or any SPV with any
Environmental Law; and
(iii) 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, any of its Subsidiaries or any SPV other than
in the ordinary course of business.
(e) The Borrower will promptly, and in any event within five (5) Days,
after an officer of the Borrower has knowledge thereof, give written notice to
the Administrative Agent of (who will in turn provide notice to the Lenders of):
(i) the occurrence of any Default or Event of Default; (ii) any litigation or
governmental proceeding of the type described in Section 5.4; (iii) any
circumstance that has had or could reasonably be expected to have a Material
Adverse Effect; (iv) the occurrence of any event which has resulted in a breach
of, or is likely to result in a breach of, Sections 6.17 or 6.18; and (v) any
notice received by it, any Subsidiary or any SPV from the holder(s) of
Indebtedness of the Borrower, any Subsidiary or any SPV in an amount which, in
the aggregate, exceeds $30,000,000, where such notice states or claims the
existence or occurrence of any default or event of default with respect to such
Indebtedness under the terms of any indenture, loan or credit agreement,
debenture, note, or other document evidencing or governing such Indebtedness.
Section 6.7. Lender Inspection Rights. Upon reasonable notice from the
Administrative Agent or any Lender, the Borrower will permit the Administrative
Agent or any Lender (and such Persons as the Administrative Agent or such Lender
may reasonably designate) during normal business hours at such entity's sole
expense unless a Default or Event of 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 or any of its Subsidiaries, to examine all of
their books and records, to make copies and extracts therefrom, and to discuss
their respective affairs, finances and accounts with their respective officers
and independent public accountants (and by this provision the Borrower
authorizes such accountants to discuss with the Administrative Agent and any
Lender (and such Persons as the Administrative Agent or such Lender may
reasonably designate) the affairs, finances and accounts of the Borrower and its
Subsidiaries), 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 Administrative
Agent or the Lenders and such accountants. The Administrative 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
6.7 and/or Section 6.6 and to coordinate the exercise by the Lenders of such
rights.
Section 6.8. Conduct of Business. The Borrower and its Subsidiaries will at
all times remain primarily engaged in (i) the contract drilling business,
(ii) the provision of services to the energy industry, (iii) other existing
businesses described in the Borrower's current SEC reports and in the Transocean
Schlumberger Joint Proxy Statement, and (iv) any related businesses (each a
"Permitted Business").
36
Section 6.9. Limitation on Certain Restrictions on Subsidiaries. The
Borrower and its Subsidiaries will not, directly or indirectly, create or
otherwise permit to exist or become effective any contractual restriction on the
ability of any Subsidiaries of the Borrower to (i) pay dividends or make any
other distributions to the Borrower or any of its Subsidiaries, SPVs or
Affiliates on the Borrower's or such Subsidiary's capital stock, partnership or
limited liability company interests, or other equity or ownership interests, or
any other interest or participation in its profits, or pay any Indebtedness owed
to the Borrower or any of its Subsidiaries, or (ii) make loans or advances to
the Borrower or any of its Subsidiaries, except for:
(a) Existing restrictions as to Subsidiaries of the Borrower (including
Sedco Forex and its Subsidiaries) as described on Schedule 5.22 hereto;
(b) Restrictions existing as to Sedco Forex and its Subsidiaries at the
time of the Sedco Forex Merger, provided that such restrictions do not restrict
or impair the payment or making of such distributions, dividends, loans,
interests or participations in profits, or payments of Indebtedness by Sedco
Forex and such Subsidiaries in an aggregate amount greater than ten percent
(10%) of Consolidated EBITDA for the most recently ended fiscal year of the
Borrower and Sedco Forex and their respective Subsidiaries on a pro forma
combined basis;
(c) Restrictions imposed by law or this Agreement;
(d) Customary restrictions contained in agreements relating to the sale of
a Subsidiary or its assets pending such sale, provided such restrictions apply
only to such Subsidiary or such assets to be sold;
(e) Restrictions applicable to SPVs or the stock of SPVs;
(f) Customary restrictions in contracts as to the assignment thereof;
(g) Restrictions relating to any assets acquired after the Effective Date
of this Agreement, provided such restrictions relate only to the assets so
acquired and are not created in anticipation of such acquisition;
(h) Restrictions relating to any acquired Indebtedness of any Subsidiary at
the date on which such Subsidiary was acquired by the Borrower or any Subsidiary
(other than Indebtedness incurred in anticipation of such acquisition), provided
such restriction relates only to such acquired Indebtedness and Subsidiary;
(i) Restrictions imposed in connection with a refinancing or assumption of
Indebtedness that is subject to similar restrictions otherwise permitted by this
Agreement;
(j) Restrictions on the sale or other disposition of any property securing
any Non-recourse Debt or any Indebtedness as a result of a Permitted Lien on
such property;
(k) Customary restrictions on cash or other deposits imposed by customers
under contracts entered into in the ordinary course of business;
37
(l) Restrictions contained in agreements or instruments relating to
Indebtedness that prohibit the transfer of all or substantially all of the
assets of the obligor thereunder unless the transferee shall assume the
obligations of the obligor under such agreement or instrument; and
(m) Agreements as to formalities required to declare or make a dividend or
distribution or that require retention of reasonable cash reserves for working
capital purposes.
Section 6.10. Restrictions on Fundamental Changes. The Borrower shall not
merge or consolidate with any other Person, or cause or permit any dissolution
of the Borrower or liquidation of its assets, or sell, transfer or otherwise
dispose of all or substantially all of the Borrower's assets, except that:
(a) The Borrower or any of its Subsidiaries may merge into, or consolidate
with, any other Person if upon the consummation of any such merger or
consolidation the Borrower or such Subsidiary is the surviving corporation to
any such merger or consolidation (or the other Person is, or will thereby
become, a Subsidiary of the Borrower), and
(b) The Borrower may sell or transfer all or substantially all of its
assets (including stock in its Subsidiaries) to any Person if such Person is a
Subsidiary of the Borrower (or a Person who will contemporaneously therewith
become a Subsidiary of the Borrower);
provided in the case of any transaction described in the preceding clauses (a)
and (b), (x) the Borrower or any such Subsidiary complies with the provisions of
Section 6.9 to the extent applicable, and (y) no Default or Event of Default
shall exist immediately prior to, or after giving effect to, such transaction.
Section 6.11. Liens . The Borrower and its Subsidiaries 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 or any Subsidiary, except the following
(collectively, the "Permitted Liens"):
(a) Liens existing on the date hereof (each such Lien, to the extent it
secures Indebtedness or other obligations in an aggregate amount of $20,000,000
or more, being described on Schedule 5.23 attached hereto);
(b) 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 or its Subsidiaries are parties
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;
38
(c) mechanics', workmen's, materialmen's, landlords', carriers' 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 if such Liens arise with respect to domestic assets and for
more than ninety (90) days if such Liens arise with respect to foreign assets,
or, if so overdue, that are being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP have been provided therefor, or
if such Liens otherwise could not reasonably be expected to have a Material
Adverse Effect;
(d) Liens for Taxes not more than ninety (90) days past due or which can
thereafter be paid without penalty or which are being contested in good faith by
appropriate proceedings and reserves in conformity with GAAP have been provided
therefor, or if such Liens otherwise could not reasonably be expected to have a
Material Adverse Effect;
(e) 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, or if such Liens otherwise could not
reasonably be expected to have a Material Adverse Effect;
(f) Liens arising out of judgments or awards against the Borrower or any of
its Subsidiaries, 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 or such Subsidiary shall be prosecuting on 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 (net of customary deductibles, and including interest, costs, fees
and penalties, if any) of the Borrower and its Subsidiaries secured by such
Liens shall not exceed $30,000,000 at any one time outstanding;
(g) Liens on fixed or capital assets and related inventory and intangible
assets acquired, constructed, improved, altered or repaired by the Borrower or
any Subsidiary; provided that (i) such Liens secure Indebtedness otherwise
permitted by this Agreement, (ii) such Liens and the Indebtedness secured
thereby are incurred prior to or within 365 days after such acquisition or the
later of the completion of such construction, improvement, alteration or repair
or the date of commercial operation of the assets constructed, improved, altered
or repaired, (iii) the Indebtedness secured thereby does not exceed the cost of
acquiring, constructing, improving, altering or repairing such fixed or capital
assets, as the case may be, and (iv) such Lien shall not apply to any other
property or assets of the Borrower or any Subsidiary;
(h) Liens securing Interest Rate Protection Agreements or foreign exchange
hedging obligations incurred in the ordinary course of business and not for
speculative purposes;
(i) Liens on property existing at the time such property is acquired by the
Borrower or any Subsidiary of the Borrower and not created in contemplation of
such acquisition (or on
39
repairs, renewals, replacements, additions, accessions and betterments thereto),
and Liens on the assets of any Person at the time such Person becomes a
Subsidiary of the Borrower and not created in contemplation of such Person
becoming a Subsidiary of the Borrower (or on repairs, renewals, replacements,
additions, accessions and betterments thereto;
(j) any extension, renewal or replacement (or successive extensions,
renewals or replacements) in whole or in part of any Lien referred to in the
foregoing subsections (a) through (i), provided, however, that the principal
amount of Indebtedness secured thereby does not exceed the principal amount
secured at the time of such extension, renewal or replacement (other than
amounts incurred to pay costs of extension, renewal or replacement), and that
such extension, renewal or replacement is limited to the property already
subject to the Lien so extended, renewed or replaced;
(k) 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 or to purchase, condemn, expropriate
or recapture or to designate a purchaser of any of the property of a Person;
(l) rights reserved to or vested in any municipality or governmental,
statutory or public authority to control, regulate or use any property of a
Person;
(m) rights of a common owner of any interest in property held by a Person
and such common owner as tenants in common or through other common ownership;
(n) encumbrances (other than to secure the payment of Indebtedness),
easements, restrictions, servitudes, permits, conditions, covenants, exceptions
or reservations in any property or rights-of-way of a Person for the purpose of
roads, pipelines, transmission lines, transportation lines, distribution lines,
removal of gas, oil, coal, metals, steam, minerals, timber or other natural
resources, and other like purposes, or for the joint or common use of real
property, rights-of-way, facilities or equipment, or defects, irregularity and
deficiencies in title of any property or rights-of-way;
(o) zoning, planning and environmental laws and ordinances and municipal
regulations;
(p) financing statements filed by lessors of property (but only with
respect to the property so leased);
(q) Liens on property securing Non-recourse Debt;
(r) Liens on the stock or assets of SPVs (including Transocean Enterprise,
Inc. and the Transocean Amirante and the Discoverer Enterprise); and
40
(s) Liens (not otherwise permitted by this Section 6.11) on property securing
Indebtedness (or other obligations) not exceeding $100,000,000 in the
aggregate at any time outstanding.
Section 6.12. Indebtedness. The Borrower and its Subsidiaries shall not
incur, assume or suffer to exist any Indebtedness, except:
(a) existing Indebtedness outstanding on the Effective Date (such
Indebtedness, to the extent the principal amount thereof is $20,000,000 or more,
being described on Schedule 5.21 attached hereto), and any subsequent
extensions, renewals or refinancings thereof so long as such Indebtedness is not
increased in amount, the scheduled maturity date thereof (if prior to the
Maturity Date) is not accelerated, the interest rate per annum applicable
thereto is not increased, any scheduled amortization of principal thereunder
prior to the Maturity Date is not shortened and the payments thereunder are not
increased;
(b) Indebtedness under the Credit Documents;
(c) intercompany loans and advances to the Borrower or its Subsidiaries,
and intercompany loans and advances from any of such Subsidiaries or SPVs to the
Borrower or any other Subsidiaries of the Borrower;
(d) Indebtedness under any Interest Rate Protection Agreements and under
foreign exchange futures agreements, arrangements or options designed to protect
against fluctuations in currency exchange rates;
(e) Indebtedness of the Borrower that may be incurred, assumed or suffered
to exist without violating any section of this Agreement, including, without
limitation, Sections 6.17 and 6.18 hereof;
(f) Indebtedness of any Subsidiary of the Borrower (i) under overdraft
lines of credit or for working capital purposes in foreign countries with
financial institutions on terms no more favorable to the lenders thereunder than
under this Agreement, and (ii) arising from the honoring by a bank or other
Person of a check, draft or similar instrument inadvertently drawing against
insufficient funds, all such Indebtedness not to exceed $50,000,000 in the
aggregate at any time outstanding, provided that amounts under overdraft lines
of credit or outstanding as a result of drawings against insufficient funds
shall be outstanding for one (1) Business Day before being included in such
aggregate amount;
(g) Indebtedness of a Person existing at the time such Person becomes a
Subsidiary of the Borrower or is merged with or into the Borrower or any
Subsidiary of the Borrower and not incurred in contemplation of such
transaction;
(h) Indebtedness of the Borrower or any Subsidiary of the Borrower
(i) under Performance Guaranties and Performance Letters of Credit, and
(ii) with respect to letters of credit issued in the ordinary course of
business;
41
(i) Indebtedness of any Subsidiaries of the Borrower in an aggregate
principal amount for all Subsidiaries not to exceed an amount equal to ten
percent (10%) of Consolidated Net Assets (the "Subsidiary Debt Basket Amount")
in the aggregate at any time outstanding;
(j) other Indebtedness of any Subsidiary of the Borrower so long as such
Subsidiary has in force a Subsidiary Guaranty in substantially the form of
Exhibit 6.12, provided that such Subsidiary Guaranty shall contain a provision
that such Subsidiary Guaranty and all obligations thereunder of the Guarantor
party thereto shall be terminated upon delivery to the Administrative Agent by
the Borrower of a certificate stating that (x) the aggregate principal amount of
Indebtedness of all Subsidiaries outstanding pursuant to the preceding clause
(i) and this clause (j) is equal to or less than the Subsidiary Debt Basket
Amount, and (y) no Default or Event of Default has occurred and is continuing;
and
(k) extensions, renewals or replacements of Indebtedness permitted by
this Section 6.12 that do not increase the amount of such Indebtedness.
Section 6.13. Use of Property and Facilities; Environmental Laws. The
Borrower and its Subsidiaries shall comply in all material respects with all
Environmental Laws applicable to or affecting the properties or business
operations of the Borrower or any Subsidiary of the Borrower, where the failure
to comply could reasonably be expected to have a Material Adverse Effect.
Section 6.14. Transactions with Affiliates. Except as otherwise
specifically permitted herein, the Borrower and its Subsidiaries shall not
(except pursuant to contracts outstanding as of (i) with respect to the
Borrower, the Effective Date or (ii) with respect to any Subsidiary of the
Borrower, the Effective Date or, if later, the date such Subsidiary first became
a Subsidiary of the Borrower) 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 Controlling Affiliate, including without
limitation, the purchase from, sale to or exchange of property with, any merger
or consolidation with or into, or the rendering of any service by or for, any
Controlling Affiliate, except pursuant to the requirements of the Borrower's or
such Subsidiary'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 or such Subsidiary.
Section 6.15. Sale and Leaseback Transactions. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into, assume, or suffer to
exist any Sale-Leaseback Transaction, except any such transaction that may be
entered into, assumed or suffered to exist without violating any other provision
of this Agreement, including without limitation, Sections 6.17 and 6.18.
Section 6.16. Compliance with Laws. Without limiting any of the other
covenants of the Borrower in this Article 6, the Borrower and its Subsidiaries
shall conduct their 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 6.16 shall not
require the Borrower or any Subsidiary of 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
42
faith by appropriate proceedings and reserves in conformity with GAAP have been
provided therefor, or (y) the failure to comply therewith could not reasonably
be expected to have a Material Adverse Effect.
Section 6.17. Interest Coverage Ratio. The Borrower will not permit the
Interest Coverage Ratio as of the end of each fiscal quarter of the Borrower to
be less than 3:00 to 1:00.
Section 6.18. Indebtedness to Total Capitalization Ratio. The Borrower
will maintain, as of the end of each fiscal quarter of the Borrower, a ratio
(expressed as a percentage) of Consolidated Indebtedness to Total Capitalization
of no greater than 40%.
ARTICLE 7. EVENTS OF DEFAULT AND REMEDIES.
Section 7.1. 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 any principal amount of the
Term 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 Sections 6.10, 6.11, 6.17, or 6.18;
(c) default by the Borrower in the observance or performance of any
provision hereof or of any other Credit Document not mentioned in clauses (a) or
(b) above, which is not remedied within thirty (30) days after notice thereof to
the Borrower by the Administrative Agent;
(d) any representation or warranty made or deemed made herein or in any
other Credit Document by the Borrower or any Subsidiary proves untrue in any
material respect as of the date of the making, or deemed making, thereof;
(e) (x) Indedtedness in the aggregate principal amount of $30,000,000 of
the Borrower and its Subsidiaries ("Material Indebtedness") shall (i) not be
paid at maturity (beyond any applicable grace periods), or (ii) be declared to
be due and payable or required to be prepaid, redeemed or repurchased prior to
its stated maturity, or (y) any default in respect of Material Indedtedness
shall occur which permits the holders thereof, or any trustees or agents on
their behalf, to accelerate the maturity of such Indedtedness or requires such
Indedtedness to be prepaid, redeemed, or repurchased prior to its stated
maturity;
(f) the Borrower or any Significant Subsidiary (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 the benefit of creditors,
(iv) applies for, seeks, consents to, or acquiesces in, the appointment of
a receiver, custodian, trustee, liquidator or
43
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 7.1(f);
(g) a custodian, receiver, trustee, liquidator or similar official is
appointed for the Borrower or any Significant Subsidiary 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 7.1(f)(v) is instituted against the Borrower or
any Significant Subsidiary, 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);
(h) the Borrower or any Subsidiaries of the Borrower fail within thirty
(30) days with respect to any judgments or orders that are rendered in the
United States or sixty (60) days with respect to any judgments or orders that
are rendered in foreign jurisdictions (or such earlier date as any execution on
such judgments or orders shall take place) to vacate, pay, bond or otherwise
discharge any judgments or orders for the payment of money the uninsured portion
of which is in excess of $30,000,000 in the aggregate and which are not stayed
on appeal or otherwise being appropriately contested in good faith in a manner
that stays execution;
(i) (x) the Borrower or any Subsidiary of the Borrower fails to pay when
due an amount 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 or any of its Subsidiaries in excess of $30,000,000
(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 any Borrower or any Subsidiary 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, and (y) the occurrence
of one or more of the matters in the preceding clause (x) could reasonably be
expected to have a Material Adverse Effect; or
(j) any Person or group of Persons acting in concert (as such terms are
used in Rule 13d-5 under the Securities Exchange Act of 1934, as amended, which
the Borrower and the Lenders acknowledge would not include the public
shareholders of Schlumberger/Sedco Forex receiving shares of the Borrower in the
Sedco Forex Merger) shall own, directly or indirectly, beneficially or of
record, securities of the Borrower (or other securities convertible into such
44
securities) representing fifty percent (50%) or more of the combined voting
power of all outstanding securities of the Borrower entitled to vote in the
election of directors, other than securities having such power only by reason of
the happening of a contingency.
Section 7.2. Non-Bankruptcy Defaults. When any Event of Default (other than
those described in subsections (f) or (g) of Section 7.1 with respect to the
Borrower) has occurred and is continuing, the Administrative Agent shall, by
notice to the Borrower: (a) if so directed by the Required Lenders, terminate
any Commitments to the Borrower in effect hereunder on the date stated in such
notice (which may be the date thereof); and (b) if so directed by the Required
Lenders, declare the principal of and the accrued interest on all outstanding
Notes to be forthwith due and payable and thereupon all outstanding Notes,
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
Administrative Agent, after giving notice to the Borrower pursuant to this
Section 7.2, 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 7.3. Bankruptcy Defaults. When any Event of Default described in
subsections (f) or (g) of Section 7.1 has occurred and is continuing with
respect to the Borrower, then all outstanding Notes 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 obligations of the Lenders
shall immediately terminate.
Section 7.4. Notice of Default. The Administrative Agent shall give notice
to the Borrower under Section 7.2 promptly upon being requested to do so by the
Required Lenders and shall thereupon notify all the Lenders thereof.
Section 7.5. Expenses The Borrower agrees to pay to the Administrative
Agent and each Lender all reasonable out-of-pocket expenses incurred or paid by
the Administrative Agent or such Lender, including reasonable attorneys' fees
and court costs, in connection with any Default or Event of Default by the
Borrower hereunder or in connection with the enforcement of any of the Credit
Documents.
Section 7.6. Distribution and Application of Proceeds. After the occurrence
of and during the continuance of an Event of Default, any payment to the
Administrative Agent or any Lender hereunder or otherwise shall be paid to the
Administrative Agent to be distributed and applied as follows (unless otherwise
agreed by the Borrower, the Administrative Agent and all Lenders):
(a) First, to the payment of any and all reasonable out-of-pocket costs and
expenses of the Administrative Agent, including without limitation, reasonable
attorneys' fees and out-of-pocket costs and expenses, as provided by this
Agreement or by any other Credit Document, incurred in connection with the
collection of such payment or in respect of the enforcement of
45
any rights of the Administrative Agent or the Lenders under this Agreement or
any other Credit Document;
(b) Second, to the payment of any and all reasonable out-of-pocket costs
and expenses of the Lenders, including, without limitation, reasonable
attorneys' fees and out-of-pocket costs and expenses, as provided by this
Agreement or by any other Credit Document, incurred in connection with the
collection of such payment or in respect of the enforcement of any rights of the
Lenders under this Agreement or any other Credit Document, pro rata in the
proportion in which the amount of such costs and expenses unpaid to each Lender
bears to the aggregate amount of the costs and expenses unpaid to all Lenders
collectively, until all such fees, costs and expenses have been paid in full;
(c) Third, to the payment of any due and unpaid fees to the Administrative
Agent or any Lender as provided by this Agreement or any other Credit Document,
pro rata in the proportion in which the amount of such fees due and unpaid to
the Administrative Agent and each Lender bears to the aggregate amount of the
fees due and unpaid to the Administrative Agent and all Lenders collectively,
until all such fees have been paid in full;
(d) Fourth, to the payment of accrued and unpaid interest on the Notes to
the date of such application, pro rata in the proportion in which the amount of
such interest, accrued and unpaid to each Lender bears to the aggregate amount
of such interest accrued and unpaid to all Lenders collectively, until all such
accrued and unpaid interest has been paid in full;
(e) Fifth, to the payment of the outstanding due and payable principal
amount of each of the Notes, pro rata in the proportion in which the outstanding
principal amount of such Notes owing to each Lender bears to the aggregate
amount of all outstanding Notes;
(f) Sixth, to the payment of any other outstanding Obligations then due and
payable, pro rata in the proportion in which the outstanding Obligations owing
to each Lender bears to the aggregate amount of such Obligations until all such
Obligations have been paid in full; and
(g) Seventh, to the Borrower or to such other Person as may be lawfully
entitled thereto.
ARTICLE 8. CHANGE IN CIRCUMSTANCES.
Section 8.1. Change of Law.
(a) Notwithstanding any other provisions of this Agreement or any Note, if
at any time any change, after the date hereof (or, if later, after the date the
Administrative Agent, the Documentation Agent, the Syndication Agent, any Senior
Managing Agent or a Lender becomes the Administrative Agent, the Documentation
Agent, the Syndication Agent, a Senior Managing Agent or a Lender), in
applicable law or regulation or in the interpretation thereof makes it unlawful
for any Lender to make or maintain Eurodollar Loans, such Lender shall promptly
give written notice thereof and of the basis therefor in reasonable detail to
the Borrower and such Lender's obligations to fund Eurodollar Loans or make,
continue or convert Loans as or into
46
Eurodollar Loans under this Agreement shall thereupon be suspended until it is
no longer unlawful for such 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 make or continue its portion 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 Lender that has given any notice pursuant to Section 8.1(a) shall,
upon determining that it would no longer be unlawful for it to make Eurodollar
Loans, give prompt written notice thereof to the Borrower and the Administrative
Agent, and upon giving such notice, its obligation to make, allow conversions
into and maintain Eurodollar Loans shall be reinstated.
Section 8.2. Unavailability of Deposits or Inability to Ascertain LIBOR
Rate. If on or before the first day of any Interest Period for any Borrowing of
Eurodollar Loans the Administrative Agent determines in good faith (after
consultation with the other Lenders) that, due to changes in circumstances since
the date hereof, adequate and fair means do not exist for determining the
Adjusted LIBOR Rate or such rate will not accurately reflect the cost to the
Required Lenders of funding Eurodollar Loans for such Interest Period, the
Administrative Agent shall give written notice (in reasonable detail) of such
determination and of the basis therefor to the Borrower and the Lenders,
whereupon until the Administrative Agent notifies the Borrower and Lenders that
the circumstances giving rise to such suspension no longer exist (which the
Administrative Agent shall do promptly after they do not exist), (i) the
obligations of the Lenders to make, continue or convert Loans as or into
Eurodollar Loans, or to convert Base Rate 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 8.3. Increased Cost and Reduced Return.
(a) If, on or after the date hereof, the adoption of or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any 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 the Administrative Agent,
the Documentation Agent, a Syndication Agent, a Senior Managing Agent or Lender
becomes the Administrative Agent, the Documentation Agent, the Syndication
Agent, a Senior Managing Agent or Lender):
(i) subjects any Lender (or its Lending Office) to any tax, duty or
other charge related to any Eurodollar Loan or its obligation to advance or
maintain Eurodollar Loans, or shall change the basis of taxation of
payments to any Lender (or its Lending
47
Office) of the principal of or interest on its Eurodollar Loans, or any
other amounts due under this Agreement related to its Eurodollar Loans, or
its obligation to make Eurodollar Loans (except for changes with respect to
taxes that are not Indemnified Taxes pursuant to Section 3.3); 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 Eurodollar Reserve Percentage) against assets of, deposits
with or for the account of, or credit extended by, any Lender (or its
Lending Office) or imposes on any Lender (or its Lending Office) or on the
interbank market any other condition affecting its Eurodollar Loans or its
participation in any thereof, or its obligation to advance or maintain
Eurodollar Loans;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Lending Office) of advancing or maintaining any Eurodollar Loan or to
reduce the amount of any sum received or receivable by such Lender (or its
Lending Office) in connection therewith under this Agreement or its Note, by an
amount deemed by such Lender to be material, then, subject to Section 8.3(c),
from time to time, within thirty (30) days after receipt of a certificate from
such Lender (with a copy to the Administrative 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 Lender such additional
amount or amounts as will compensate such Lender for such increased cost or
reduction.
(b) If, after the date hereof, the Administrative Agent or any Lender
shall have reasonably determined that the adoption after the date hereof of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein (including, without limitation, any revision in the Final Risk-Based
Capital Guidelines of the Board of 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), or 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
thereof, or compliance by the Administrative Agent or any Lender (or its Lending
Office) with any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on such
Lender's capital, or on the capital of any corporation controlling such Lender,
as a consequence of its obligations hereunder to a level below that which such
Lender could have achieved but for such adoption, change or compliance (taking
into consideration such Lender'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 Lender to be material,
then, subject to Section 8.3(c), from time to time, within thirty (30) days
after its receipt of a certificate from such Lender (with a copy to the
Administrative Agent) pursuant to subsection (c) below setting forth in
reasonable detail such determination and the basis thereof, the Borrower shall
pay to such Lender such additional amount or amounts as will
48
compensate such Lender for such reduction or the Borrower may prepay all
Eurodollar Loans of such Lender.
(c) The Administrative Agent and each Lender that determines to seek
compensation under this Section 8.3 shall give written notice to the Borrower
and, in the case of a Lender other than the Administrative Agent, the
Administrative Agent of the circumstances that entitle the Administrative Agent
or such Lender to such compensation no later than ninety (90) days after such
Lender 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 prior to the ninetieth day preceding such
written demand. The Administrative Agent and each Lender shall use reasonable
efforts to avoid the need for, or reduce the amount of, such compensation and
any payment under Section 3.3, including, without limitation, the designation of
a different Lending Office, if such action or designation will not, in the sole
judgment of the Administrative Agent or such Lender made in good faith, be
otherwise disadvantageous to it; provided that the foregoing shall not in any
way affect the rights of any Lender or the obligations of the Borrower under
this Section 8.3, and provided further that no Lender shall be obligated to make
its Eurodollar Loans hereunder at any office located in the United States of
America. A certificate of the Administrative Agent or any Lender, as applicable,
claiming compensation under this Section 8.3 and setting forth the additional
amount or amounts to be paid to it hereunder and accompanied by a statement
prepared by the Administrative Agent or such Lender, as applicable, describing
in reasonable detail the calculations thereof shall be rebuttable presumptive
evidence thereof in the absence of manifest error. In determining such amount,
such Lender may use any reasonable averaging and attribution methods.
Section 8.4. Lending Offices. The Administrative Agent and each Lender may,
at its option, elect to make or maintain its Loans hereunder at the Lending
Office for each type of Loan available 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 Administrative Agent, provided that,
except 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 3.3 or 8.3 resulting from any
such transfer to the extent not otherwise applicable to such Lender prior to
such transfer.
Section 8.5. 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 8.6. Substitution of Lender. If (a) any Lender has demanded
compensation or given notice of its intention to demand compensation under
Section 8.3, (b) the Borrower is required to pay any additional amount to any
Lender under Section 2.11, (c) any Lender is unable to submit any form or
certificate required under Section 3.3(b) or withdraws or cancels any previously
submitted form with no substitution therefor, (d) any Lender gives notice of any
change in law or regulations, or in the interpretation thereof, pursuant to
Section 8.1, (e) any Lender has been declared insolvent or a receiver or
conservator has been appointed for a material portion of its assets, business or
properties or (f) any Lender shall seek to avoid its obligation to
49
make or maintain Loans hereunder for any reason, including, without limitation,
reliance upon 12 U.S.C. (S) 1821(e) or (n) (1) (B), (g) any taxes referred to in
Section 3.3 have been levied or imposed (or the Borrower determines in good
faith that there is a substantial likelihood that such taxes will be levied or
imposed) so as to require withholding or deductions by the Borrower or payment
by the Borrower of additional amounts to any Lender, or other reimbursement or
indemnification of any Lender, as a result thereof, or (h) any Lender shall
decline to consent to a modification or waiver of the terms of this Agreement or
any other Credit Documents requested by the Borrower, then and in such event,
upon request from the Borrower delivered to such Lender and the Administrative
Agent, such Lender shall assign, in accordance with the provisions of Section
10.10 and an appropriately completed Assignment Agreement, all of its rights and
obligations under the Credit Documents to another Lender or a commercial banking
institution selected by the Borrower and (in the case of a commercial banking
institution) reasonably satisfactory to the Administrative Agent, in
consideration for the payments set forth in such Assignment Agreement and
payment by the Borrower to such Lender of all other amounts which such Lender
may be owed pursuant to this Agreement, including, without limitation, Sections
2.11, 3.3, 8.3 and 10.13.
ARTICLE 9. THE ADMINISTRATIVE AGENTS.
Section 9.1. Appointment and Authorization of Administrative Agent,
Syndication Agent, Documentation Agent and Senior Managing Agents. Each Lender
hereby appoints SunTrust Bank, Atlanta as the Administrative Agent, Royal Bank
of Canada as the Syndication Agent, Bank of America, N.A. as the Documentation
Agent, and each of Bank One, NA and Paribas as Senior Managing Agents, under the
Credit Documents and hereby authorizes the Administrative Agent, the Syndication
Agent, the Documentation Agent and the Senior Managing Agents to take such
action as Administrative Agent, Syndication Agent, Documentation Agent and
Senior Managing Agents on each of its behalf and to exercise such powers under
the Credit Documents as are delegated to the Administrative Agent, the
Syndication Agent, the Documentation Agent and the Senior Managing Agents,
respectively, by the terms thereof, together with such powers as are reasonably
incidental thereto.
Section 9.2. Rights and Powers. The Administrative Agent, the Syndication
Agent, the Documentation Agent and the Senior Managing Agents shall have the
same rights and powers under the Credit Documents as any other Lender and may
exercise or refrain from exercising such rights and power as though it were not
an Administrative Agent, a Syndication Agent, a Documentation Agent or a Senior
Managing Agent, and the Administrative Agent, the Syndication Agent, the
Documentation Agent and the Senior Managing Agents and their respective
Controlling Affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrower or any of its Subsidiaries or
Controlling Affiliates as if it were not an Administrative Agent, a Syndication
Agent, a Documentation Agent or a Senior Managing Agent under the Credit
Documents. The term Lender as used in all Credit Documents, unless the context
otherwise clearly requires, includes the Administrative Agent, the Syndication
Agent, the Documentation Agent and each Senior Managing Agent in their
respective individual capacities as a Lender.
50
Section 9.3. Action by Administrative Agent, Syndication Agent,
Documentation Agent and Senior Managing Agents. The obligations of the
Administrative Agent, the Syndication Agent, the Documentation Agent and the
Senior Managing Agents under the Credit Documents are only those expressly set
forth therein. Without limiting the generality of the foregoing, the
Administrative Agent shall not be required to take any action concerning any
Default or Event of Default, except as expressly provided in Sections 7.2 and
7.4. Unless and until the Required Lenders (or, if required by Section 10.11,
all of the Lenders) give such direction the Administrative Agent may, except as
otherwise expressly provided herein or therein, take or refrain from taking such
actions as it deems appropriate and in the best interest of all the Lenders. In
no event, however, shall the Administrative Agent, the Syndication Agent, the
Documentation Agent or any Senior Managing Agent be required to take any action
in violation of applicable law or of any provision of any Credit Document, and
each of the Administrative Agent, the Syndication Agent, the Documentation Agent
and the Senior Managing Agents shall in all cases be fully justified in failing
or refusing to act hereunder or under any other Credit Document unless it first
receives any further assurances of its indemnification from the Lenders that it
may require, including prepayment of any related expenses and any other
protection it requires against any and all costs, expenses, and liabilities it
may incur in taking or continuing to take any such action. The Administrative
Agent shall be entitled to assume that no Default or Event of Default, other
than non-payment of any scheduled principal or interest payment due hereunder,
exists unless notified in writing to the contrary by a Lender or the Borrower.
In all cases in which the Credit Documents do not require the Administrative
Agent, the Syndication Agent, the Documentation Agent or any Senior Managing
Agent to take specific action, the Administrative Agent, each of the Syndication
Agent, the Documentation Agent and the Senior Managing Agents shall be fully
justified in using its discretion in failing to take or in taking any action
thereunder. Any instructions of the Required Lenders, or of any other group of
Lenders called for under specific provisions of the Credit Documents, shall be
binding on all the Lenders and holders of Notes.
Section 9.4. Consultation with Experts. Each of the Administrative Agent,
the Syndication Agent, the Documentation Agent and the Senior Managing Agents
may consult with legal counsel, independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such counsel,
accountants or experts.
Section 9.5. Indemnification Provisions; Credit Decision. Neither the
Administrative Agent, the Syndication Agent, the Documentation Agent, the Senior
Managing Agents nor any of their directors, officers, agents, or employees shall
be liable for any action taken or not taken by them in connection with the
Credit Documents (i) with the consent or at the request of the Required Lenders
(or, if required by Section 10.11, all of the Lenders), or (ii) in the absence
of their own gross negligence or willful misconduct. Neither the Administrative
Agent, the Syndication Agent, the Documentation Agent, the Senior Managing
Agents nor any of their directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement,
any other Credit Document or any Borrowing; (ii) the performance or observance
of any of the covenants or agreements of the Borrower or any Subsidiary
contained herein or in any other Credit Document; (iii) the satisfaction of any
condition specified in Article 4, except
51
receipt of items required to be delivered to the Administrative Agent; or
(iv) the validity, effectiveness, genuineness, enforceability, value, worth or
collectability hereof or of any other Credit Document or of any other documents
or writings furnished in connection with any Credit Document; and the
Administrative Agent, the Syndication Agent, the Documentation Agent and the
Senior Managing Agents make no representation of any kind or character with
respect to any such matters mentioned in this sentence. The Administrative
Agent, the Syndication Agent, the Documentation Agent and the Senior Managing
Agents may execute any of their duties under any of the Credit Documents by or
through employees, agents, and attorneys-in-fact and shall not be answerable to
the Lenders or any other Person for the default or misconduct of any such agents
or attorneys-in-fact selected with reasonable care. The Administrative Agent,
the Syndication Agent, the Documentation Agent and the Senior Managing Agents
shall not incur any liability by acting in reliance upon any notice, consent,
certificate, other document or statement (whether written or oral) believed by
it to be genuine or to be sent by the proper party or parties. In particular and
without limiting any of the foregoing, the Administrative Agent and the
Documentation Agent shall have no responsibility for confirming the accuracy of
any Compliance Certificate or other document or instrument received by any of
them under the Credit Documents. The Administrative Agent, the Syndication
Agent, the Documentation Agent and the Senior Managing Agents may treat the
payee of any Note as the holder thereof until written notice of transfer shall
have been filed with such Administrative Agent signed by such owner in form
satisfactory to such Administrative Agent. Each Lender acknowledges that it has
independently, and without reliance on the Administrative Agent, the Syndication
Agent, the Documentation Agent or any of the Senior Managing Agents or any other
Lender, obtained such information and made such investigations and inquiries
regarding the Borrower and its Subsidiaries as it deems appropriate, and based
upon such information, investigations and inquiries, made its own credit
analysis and decision to extend credit to the Borrower in the manner set forth
in the Credit Documents. It shall be the responsibility of each Lender to keep
itself informed about the creditworthiness and business, properties, assets,
liabilities, condition (financial or otherwise) and prospects of the Borrower
and its Subsidiaries, and the Administrative Agent, the Syndication Agent, the
Documentation Agent and the Senior Managing Agents shall have no liability
whatsoever to any Lender for such matters. The Administrative Agent, the
Syndication Agent, the Documentation Agent and the Senior Managing Agents shall
have no duty to disclose to the Lenders information that is not required by any
Credit Document to be furnished by the Borrower or any Subsidiaries to such
Agent at such time, but is voluntarily furnished to such Agent (either in their
respective capacity as Administrative Agent, the Syndication Agent, the
Documentation Agent or the Senior Managing Agents or in their individual
capacity).
Section 9.6. Indemnity. The Lenders shall ratably, in accordance with their
Percentages, indemnify and hold the Administrative Agent, the Syndication Agent,
the Documentation Agent, the Senior Managing Agents, and their directors,
officers, employees, agents and representatives harmless from and against any
liabilities, losses, costs or expenses suffered or incurred by it under any
Credit Document or in connection with the transactions contemplated thereby,
regardless of when asserted or arising, except to the extent they are promptly
reimbursed for the same by the Borrower and except to the extent that any event
giving rise to a claim was caused by the gross negligence or willful misconduct
of the party seeking to
52
be indemnified. The obligations of the Lenders under this Section 9.6 shall
survive termination of this Agreement.
Section 9.7. Resignation of Agents and Successor Agents. The Administrative
Agent, the Syndication Agent, the Documentation Agent and any Senior Managing
Agent may resign at any time and shall resign upon any removal thereof as a
Lender pursuant to the terms of this Agreement upon at least thirty (30) days'
prior written notice to the Lenders and the Borrower. Any resignation of the
Administrative Agent shall not be effective until a replacement therefor is
appointed pursuant to the terms hereof. Upon any such resignation of the
Administrative Agent, the Syndication Agent, the Documentation Agent or any
Senior Managing Agent, the Required Lenders and, so long as no Event of Default
shall then exist, with the consent of the Borrower (which consent shall not be
unreasonably withheld or delayed) shall have the right to appoint a successor
Administrative Agent, Syndication Agent, Documentation Agent or Senior Managing
Agent, as the case may be. If no successor Administrative Agent, Syndication
Agent, Documentation Agent or Senior Managing Agent, as the case may be, shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Administrative Agent's,
Syndication Agent's, Senior Managing Agent's or Documentation Agent's giving of
notice of resignation, then the retiring Administrative Agent, Syndication
Agent, Documentation Agent or Senior Managing Agent, as the case may be, may, on
behalf of the Lenders and, so long as no Event of Default shall then exist, with
the consent of the Borrower (which consent shall not be unreasonably withheld or
delayed) appoint a successor Administrative Agent, Syndication Agent,
Documentation Agent or Senior Managing Agent, as the case may be, which shall be
any Lender hereunder or any commercial bank organized under the laws of the
United States of America or of any State thereof and having a combined capital
and surplus of at least $1,000,000,000. Upon the acceptance of its appointment
as the Administrative Agent, the Syndication Agent, the Documentation Agent or
any Senior Managing Agent hereunder, such successor Administrative Agent,
Syndication Agent, Documentation Agent or Senior Managing Agent, as the case may
be, shall thereupon succeed to and become vested with all the rights and duties
of the retiring Administrative Agent, Syndication Agent, Documentation Agent or
Senior Managing Agent, as the case may be, under the Credit Documents, and the
retiring Administrative Agent, Syndication Agent, Documentation Agent or any
Senior Managing Agent shall be discharged from its duties and obligations
thereunder. After any retiring Administrative Agent's, Syndication Agent's,
Documentation Agent's or Senior Managing Agent's resignation hereunder as
Administrative Agent, Syndication Agent, Documentation Agent or Senior Managing
Agent, as the case may be, the provisions of this Article 9 and all protective
provisions of the other Credit Documents shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent,
Syndication Agent, Documentation Agent or Senior Managing Agent, as the case may
be.
ARTICLE 10. MISCELLANEOUS.
Section 10.1. No Waiver. No delay or failure on the part of the
Administrative Agent or any Lender, or on the part of the holder or holders of
any Notes, in the exercise of any power, right or remedy under any Credit
Document shall operate as a waiver thereof or as an acquiescence in any default,
nor shall any single or partial exercise thereof preclude any other or further
exercise of any other power, right or remedy. To the fullest extent permitted
by
53
applicable law, the powers, rights and remedies under the Credit Documents of
the Administrative Agent, the Lenders and the holder or holders of any Notes are
cumulative to, and not exclusive of, any powers, rights or remedies any of them
would otherwise have.
Section 10.2. Non-Business Day. Subject to Section 2.4, if any payment of
principal or interest on any portion of the Term Loan or of any other Obligation
shall fall due on a day which is not a Business Day, interest or fees (as
applicable) at the rate, if any, such portion of the Term Loan or other
Obligation bears for the period prior to maturity shall continue to accrue in
the manner set forth herein on such Obligation from the stated due date thereof
to the next succeeding Business Day, on which the same shall instead be payable.
Section 10.3. Documentary Taxes. The Borrower agrees that it will pay any
documentary, stamp or similar taxes payable with respect to any Credit Document,
including interest and penalties, in the event any such taxes are assessed
irrespective of when such assessment is made, other than any such taxes imposed
as a result of any transfer of an interest in a Credit Document. Each Lender
that determines to seek compensation under this Section 10.3 shall give written
notice to the Borrower and, in the case of a Lender other than the
Administrative Agent, the Administrative Agent of the circumstances that entitle
such Lender to such compensation no later than ninety (90) days after such
Lender 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 prior to the 90th day preceding such
written demand.
Section 10.4. Survival of Representations. All representations and
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and the other Credit Documents, and
shall continue in full force and effect with respect to the date as of which
they were made as long as the Borrower has any Obligation hereunder or any
Commitment hereunder is in effect.
Section 10.5. Survival of Indemnities. All indemnities and all provisions
relative to reimbursement to the Lenders of amounts sufficient to protect the
yield of the Lenders with respect to the Term Loan, including, but not limited
to, Section 2.11, Section 3.3, Section 7.5, Section 8.3 and Section 10.13
hereof, shall, subject to Section 8.3(c), survive the termination of this
Agreement and the other Credit Documents and the payment of the Term Loan and
all other Obligations and, with respect to any Lender, any replacement by the
Borrower of such Lender pursuant to the terms hereof, in each case for a period
of one (1) year.
Section 10.6. 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 and each subsequent holder of any Note is hereby authorized by the
Borrower at any time or from time to time, 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
54
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 10.6, 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 application of deposit balances or otherwise,
in respect of the Term Loan in excess of its ratable share of payments 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 Term Loan 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 10.7. Notices. Except as otherwise specified herein, all notices
under the Credit Documents shall be in writing (including cable, telecopy or
telex) and shall be given to a party hereunder at its address, telecopier number
or telex number set forth below or such other address, telecopier number or
telex number as such party may hereafter specify by notice to the Administrative
Agent and the Borrower, given by courier, by United States certified or
registered mail, by telegram or by other telecommunication device capable of
creating a written record of such notice and its receipt. Notices under the
Credit Documents to the Lenders and the Administrative Agent shall be addressed
to their respective addresses, telecopier or telex number, or telephone numbers
set forth on the signature pages hereof, and to the Borrower to:
Transocean Offshore Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
With a copy to:
Xxxxx & Xxxxx, L.L.P.
Xxx Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxx Xxxxx
Telephone No. (000) 000-0000
Fax No.: (000) 000-0000
Each such notice, request or other communication shall be effective (i) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section 10.7, on the signature pages hereof or pursuant to
Section 10.10 and a confirmation of receipt of such
55
telecopy has been received by the sender, (ii) if given by courier, when
delivered, (iii) if given by mail, five (5) days after such communication is
deposited in the mail, certified or registered with return receipt requested, or
(iv) if given by any other means, when delivered at the addresses specified in
this Section 10.7, on the signature pages hereof or pursuant to Section 10.10;
provided that any notice given pursuant to Article 2 shall be effective only
upon receipt and, provided further, that any notice that but for this proviso
would be effective after the close of business on a Business Day or on a day
that is not a Business Day shall be effective at the opening of business on the
next Business Day.
Section 10.8. Counterparts. This Agreement may be executed in any number of
counterparts, and by the different parties on different counterpart signature
pages, each of which when executed shall be deemed an original, but all such
counterparts taken together shall constitute one and the same Agreement.
Section 10.9. Successors and Assigns. This Agreement shall be binding upon
the Borrower, each of the Lenders, the Administrative Agent, the Syndication
Agent, the Documentation Agent, the Senior Managing Agents, and their respective
successors and assigns, and shall inure to the benefit of the Borrower, each of
the Lenders, the Administrative Agent, the Syndication Agent, the Documentation
Agent, the Senior Managing Agents, and their respective successors and assigns,
including any subsequent holder of any Note; 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 Administrative
Agent, the Syndication Agent, the Documentation Agent and the Senior Managing
Agents, and the Administrative Agent, the Syndication Agent, the Documentation
Agent and the Senior Managing Agents may not assign any of their respective
rights or obligations under this Agreement or any Credit Document except in
accordance with Article 9 and no Lender may assign any of its rights or
obligations under this Agreement or any other Credit Document except in
accordance with Section 10.10. Any Lender may at any time pledge or assign all
or any portion of its rights under this Agreement and the Notes issued to it to
a Federal Reserve Bank to secure extensions of credit by such Federal Reserve
Bank to such Lender; provided that no such pledge or assignment shall release a
Lender from any of its obligations hereunder or substitute any such Federal
Reserve Bank for such Lender as a party hereto.
Section 10.10. Sales and Transfers of Portions of Term Loan and Notes;
Participations in Portions of Term Loan and Notes.
(a) Any Lender may at any time sell to one or more commercial banking or
other financial or lending institutions ("Participants") participating interests
in any portion of the Term Loan held by such Lender, any Note held by such
Lender, any Commitment of such Lender or any other interest of such Lender
hereunder, provided that no 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 Lenders or the Required Lenders
hereunder or under any other Credit Document or to approve any amendment to or
waiver of this Agreement or any other Credit Document, except to the extent such
amendment or waiver would (i) increase the amount of such Lender's Commitment
and such increase would affect such Participant, (ii) reduce the principal of,
or interest on, any portion of the Term Loan held by such Lender, or any fees or
56
other amounts payable to such 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 portion of the Term Loan held by such Lender,
or any fees or other amounts payable to such Lender hereunder, and such
postponement would affect such Participant, or (iv) release any collateral
security for any Obligation, except as otherwise specifically provided in any
Credit Document. In the event of any such sale by a Lender of participating
interests to a Participant, such Lender's obligations under this Agreement to
the other parties to this Agreement shall remain unchanged, such Lender shall
remain solely responsible for the performance thereof, such Lender shall remain
the holder of any such Note for all purposes under this Agreement, the Borrower
and the Administrative Agent shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement, and such Lender shall retain the sole right to enforce the
obligations of the Borrower under any Credit Document. The Borrower agrees that
if amounts outstanding under this Agreement and the Notes shall have been
declared or shall have become due and payable in accordance with Section 7.2 or
7.3 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 and any Note to the same extent as if the amount of
its participating interest were owing directly to it as a Lender under this
Agreement or any Note, provided that such right of setoff shall be subject to
the obligation of such Participant to share with the Lenders, and the Lenders
agree to share with such Participant, as provided in Section 10.6. The Borrower
also agrees that each Participant shall be entitled to the benefits of Sections
2.11, 3.3 and 8.3 with respect to its participation in the Commitments and the
Term Loan amounts outstanding from time to time, provided that no Participant
shall be entitled to receive any greater amount pursuant to such Sections than
the transferor 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 8.3(c) and 8.6 shall apply to
the transferor Lender with respect to any claim by any Participant pursuant to
Section 2.11, 3.3 or 8.3 as fully as if such claim was made by such Lender.
Anything herein to the contrary notwithstanding, the Borrower shall not, at any
time, be obligated to pay to any Lender any sum in excess of the sum the
Borrower would have been obligated to pay to such Lender hereunder if such
Lender had not sold any participation in its rights and obligations under this
Agreement or any other Credit Document.
(b) Any Lender may at any time sell to (i) any other Lender or any
affiliate thereof that is a commercial banking or other financial or lending
institution, and, (ii) with the prior written consent of the Administrative
Agent and the Borrower (which shall not be unreasonably withheld or delayed), to
one or more commercial banking or other financial or lending institutions (any
of (i) or (ii), a "Purchasing 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 10.10, executed by such
Purchasing Lender and such transferor Lender (and, in the case of a Purchasing
Lender which is not then a Lender or an affiliate thereof, by the Borrower and
the Administrative Agent) and delivered to the Administrative Agent; provided
that each such sale to a Purchasing Lender shall be in an amount of $5,000,000
or more, or if in a lesser amount or if as a result of such sale the Commitment
of such Lender or the aggregate principal amount of the portion of the Term Loan
held by such Lender would be less than $5,000,000, such sale shall be of all of
such Lender's rights and obligations under this Agreement and all of the other
Credit Documents payable to it to one Purchasing Lender.
57
Notwithstanding the requirement of the Borrower's consent set forth above, but
subject to all of the other terms and conditions of this Section 10.10(b), any
Lender may sell to one or more commercial banking or other financial or lending
institutions all or any part of their rights and obligations under this
Agreement and the other Credit Documents with only the consent of the
Administrative Agent (which shall not be unreasonably withheld or delayed) if an
Event of Default shall have occurred and be continuing. Upon such execution,
delivery and acceptance, from and after the effective date of the transfer
determined pursuant to such Assignment Agreement, (x) the Purchasing Lender
thereunder shall be a party hereto and, to the extent provided in such
Assignment Agreement, have the rights and obligations of a Lender hereunder with
a Commitment as set forth herein and (y) the transferor 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 Lender's rights and
obligations under this Agreement, such transferor Lender shall cease to be a
party hereto). 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
Purchasing Lender and the resulting adjustment of Commitments and Percentages
arising from the purchase by such Purchasing Lender of all or a portion of the
rights and obligations of such transferor Lender under this Agreement, the Notes
and the other Credit Documents. On or prior to the effective date of the
transfer determined pursuant to such Assignment Agreement, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent in exchange
for any surrendered Note, a new Note as appropriate to the order of such
Purchasing Lender in an amount equal to the Commitment assumed by it pursuant to
such Assignment Agreement, and, if the transferor Lender has retained a
Commitment or any portion of the Term Loan hereunder, a new Note to the order of
the transferor Lender in an amount equal to the Commitment or such portion of
the Term Loan retained by it hereunder. Such new Notes shall be dated the
Borrowing Date and shall otherwise be in the form of the Notes replaced thereby.
The Notes surrendered by the transferor Lender shall be returned by the
Administrative Agent to the Borrower marked "cancelled."
(c) Upon its receipt of an Assignment Agreement executed by a transferor
Lender, a Purchasing Lender and the Administrative Agent (and, in the case of a
Purchasing Lender that is not then a Lender or an affiliate thereof, by the
Borrower), together with payment by the transferor Lender to the Administrative
Agent hereunder of a registration and processing fee of $3,000 (unless the
Borrower is replacing such Lender pursuant to the terms hereof, in which event
such fee shall be paid by the Borrower), the Administrative 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 Lenders and the Borrower. The Borrower shall not be
responsible for such registration and processing fee or any costs or expenses
incurred by any Lender, any Purchasing Lender or the Administrative Agent in
connection with such assignment except as provided above.
(d) If, pursuant to this Section 10.10 any interest in this Agreement or
any 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 Lender shall cause such transferee, concurrently with the
effectiveness of such transfer, (i) to represent to the transferor Lender (for
the benefit of the transferor Lender, the Administrative Agent and the Borrower)
that under
58
applicable law and treaties no taxes will be required to be withheld by the
Administrative Agent, the Borrower or the transferor Lender with respect to any
payments to be made to such transferee in respect of any portion of the Term
Loan, (ii) to furnish to the transferor Lender (and, in the case of any
Purchasing Lender, the Administrative Agent and the Borrower) two duly completed
and signed copies of either U.S. Internal Revenue Service Form 4224 or U.S.
Internal Revenue Service Form 1001 or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities (wherein such
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 Lender, the Administrative Agent and the Borrower) to
provide the transferor Lender (and, in the case of any Purchasing Lender, the
Administrative Agent and the Borrower) new forms as contemplated by Section
3.3(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.
(e) Notwithstanding any other provisions of this Section 10.10, no transfer
or assignment of the interests of any Lender hereunder or any grant of
participations therein shall be permitted if such transfer, assignment or grant
would require the Borrower to file a registration statement with the SEC or to
qualify the Term Loan, the Notes or any other Obligations under the securities
laws of any jurisdiction.
Section 10.11. Amendments, Waivers and Consents. 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 by (a) the Borrower, (b) the Required
Lenders, and (c) if the rights or duties of the Administrative Agent, the
Syndication Agent, the Documentation Agent or the Senior Managing Agents are
affected thereby, the Administrative Agent, the Syndication Agent, the
Documentation Agent or the Senior Managing Agents, as the case may be, provided
that:
(i) no amendment or waiver shall (A) increase the Commitments without
the consent of all Lenders or increase any Commitment of any Lender without
the consent of such Lender, or (B) postpone the Maturity Date without the
consent of all Lenders, or reduce the amount of or postpone the date for
any scheduled payment of any principal of or interest (including, without
limitation, any reduction in the rate of interest unless such reduction is
otherwise provided herein) on any portion of the Term Loan or of any fee
payable hereunder, without the consent of each Lender owed any such
Obligation; and
(ii) no amendment or waiver shall, unless signed by each Lender, change
the provisions of this Section 10.11 or the definition of Required Lenders
or the number of Lenders required to take any action under any other
provision of the Credit Documents.
Section 10.12. Headings. Section headings used in this Agreement are for
reference only and shall not affect the construction of this Agreement.
Section 10.13. Legal Fees, Other Costs and Indemnification. The Borrower,
upon demand by the Administrative Agent, agrees to pay the reasonable fees and
disbursements of
59
legal counsel to the Administrative Agent in connection with the preparation and
execution of the Credit Documents (which shall be in an amount agreed in writing
by the Borrower), and any amendment, waiver or consent related thereto, whether
or not the transactions contemplated therein are consummated. The Borrower
further agrees to indemnify each Lender, the Administrative Agent, the
Syndication Agent, the Documentation Agent, the Senior Managing Agents, and
their respective directors, officers, employees and attorneys (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)
which any of them may pay or incur as a result of (a) any action, suit or
proceeding by any third party or governmental authority against such Indemnified
Party and relating to any Credit Document, the Term Loan or the application or
proposed application by any of the Borrower of the proceeds of the Term 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, (b) any investigation of any third party or any governmental
authority involving any Lender (as a lender hereunder) or the Administrative
Agent, the Syndication Agent, the Documentation Agent or the Senior Managing
Agents (in such capacity hereunder) and related to any use made or proposed to
be made by the Borrower of the proceeds of the Term Loan, or any transaction
financed or to be financed in whole or in part, directly or indirectly with the
proceeds of the Term Loan, and (c) any investigation of any third party or any
governmental authority, litigation or proceeding involving any Lender (as a
lender hereunder) or the Administrative Agent, the Syndication Agent, the
Documentation Agent or the Senior Managing Agents (in such capacity hereunder)
and related to any environmental cleanup, audit, compliance or 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, 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 gross negligence or willful misconduct, as determined
pursuant to a final nonappealable judgment of a court of competent jurisdiction
or as expressly agreed in writing by such Indemnified Party. The Borrower, upon
demand by the Administrative Agent, the Syndication Agent, the Documentation
Agent, a Senior Managing Agent or a Lender at any time, shall reimburse the
Administrative Agent or such Lender 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. Each Indemnified Party agrees to contest
any indemnified claim if requested by the Borrower, in a manner reasonably
directed by the Borrower, with counsel selected by the Indemnified Party and
approved by the Borrower, which approval shall not be unreasonably withheld or
delayed. Any Indemnified Party that proposes to settle or compromise any such
indemnified claim shall give the Borrower written notice of the terms of such
proposed settlement or compromise reasonably in advance of settling or
compromising such claim or proceeding and shall obtain the Borrower's prior
written consent thereto, which consent shall not be unreasonably withheld or
delayed; provided that the Indemnified Party shall not be
60
restricted from settling or compromising any such claim if the Indemnified Party
waives its right to indemnity from the Borrower in respect of such claim.
Section 10.14. Governing Law; Submission to Jurisdiction; Waiver of Jury
Trial.
(A) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS, AND THE RIGHTS AND
DUTIES OF THE PARTIES THERETO, SHALL BE 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 ADMINISTRATIVE AGENT, THE DOCUMENTATION AGENT, THE SENIOR MANAGING AGENTS,
THE SYNDICATION 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.
THE BORROWER HEREBY IRREVOCABLY DESIGNATES CT CORPORATION SYSTEM, 000 0XX
XXXXXX, XXX XXXX, XXX XXXX 00000, AS THE DESIGNEE, APPOINTEE AND AGENT OF THE
BORROWER TO RECEIVE, FOR AND ON BEHALF OF THE BORROWER, SERVICE OF PROCESS IN
SUCH JURISDICTION IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT HERETO. 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 OR FROM ANY LEGAL PROCESS (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
61
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 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, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
Section 10.15. Confidentiality. The Lenders agree to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (i) to their respective affiliates and to prospective
Purchasing Lenders and Participants and their respective directors, officers,
employees and agents, including accountants, legal counsel and other advisors
who have reason to use such Information in connection with the evaluation of the
transactions contemplated by this Agreement (subject to similar confidentiality
provisions as provided herein) solely for purposes of evaluating such
Information, (ii) to the extent requested by any regulatory authority, (iii) to
the extent required by applicable law or regulation or by any subpoena or
similar legal process, (iv) in connection with the exercise of any remedies
hereunder or any proceedings relating to this Agreement or the other Credit
Documents, (v) with the consent of the Borrower, or (vi) to the extent such
Information (x) becomes publicly available other than as a result of a breach of
this Section 10.15, or (y) becomes available on a non-confidential basis from a
source other than the Borrower or its affiliates or the Lenders or their
respective affiliates. For purposes hereof, "Information" means all information
received by the Lenders from the Borrower relating to the Borrower or its
business, other than any such information that is available to the Lenders on a
non-confidential basis prior to disclosure by the Borrower. The Lenders shall
be considered to have complied with their respective obligations if they have
exercised the same degree of care to maintain the confidentiality of such
Information as they would accord their own confidential information.
Section 10.16. Effectiveness. This Agreement shall become effective on the
date (the "Effective Date") on which the Borrower, the Administrative Agent, and
each Lender have signed and delivered to the Administrative Agent a counterparty
signature page hereto or, in the case of a Lender, the Administrative Agent has
received a facsimile notice that such a counterpart has been signed and mailed
to the Administrative Agent.
Section 10.17. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
62
Section 10.18. Currency Conversion. All payments of Obligations under this
Agreement, the Notes or any other Credit Document shall be made in U.S. Dollars.
If any payment of any Obligation, whether through payment by the Borrower or the
proceeds of any collateral, shall be made in a currency other than U.S. Dollars
as required hereunder, such amount shall be converted into U.S. Dollars at the
official rate for the purchase of U.S. Dollars with the currency in which such
obligation was paid, as quoted by the Lender who is the Administrative Agent in
accordance with the methods customarily used by such Lender for such purposes as
of the close of business on the date of determination. The parties hereto hereby
agree, to the fullest extent that they may effectively do so under applicable
law, that (i) if for the purposes of obtaining any judgment or award it becomes
necessary to convert from any currency other than U.S. Dollars into U.S. Dollars
any amount in connection with the Obligations, then the conversion shall be made
as provided above on the Business Day before the day on which the judgment or
award is given, (ii) in the event that there is a change in the rate of exchange
prevailing between the Business Day before the day on which the judgment or
award is given and the date of payment, the Borrower will pay to the
Administrative Agent, for the benefit of the Lenders, such additional amounts
(if any) as may be necessary, and the Administrative Agent, on behalf of the
Lenders, will pay to the Borrower such excess amounts (if any) as result from
such change in the rate of exchange, to assure that the amount paid on such date
is the amount in such other currency, which when converted at the rate of
exchange described herein on the date of payment, is the amount then due in U.S.
Dollars, and (iii) any amount due from the Borrower under this Section 10.18
shall be due as a separate debt and shall not be affected by judgment or award
being obtained for any other sum due.
Section 10.19. U.S. Dollar Equivalent Combinations. Unless otherwise
provided herein, to the extent that the determination of compliance with any
requirement of this Agreement requires the conversion to U.S. Dollars of foreign
currency amounts, such U.S. Dollar amount shall be computed using the U.S.
Dollar equivalent of the amount of such foreign currency at the time such item
is to be calculated or is incurred, created, transferred or sold for purposes of
this Agreement. The U.S. Dollar equivalent shall be determined by converting
such currency involved in such computation into Dollars at the spot rate for the
purchase of U.S. Dollars with the applicable currency as quoted by the Lender
who is the Administrative Agent in accordance with the methods customarily used
by such Lender for such purposes as of the close of business on the date of
determination thereof specified herein or, if the date of determination thereof
is not otherwise specified herein, on the date two (2) Business Days prior to
such determination.
Section 10.20. Change in Accounting Principles, Fiscal Year or Tax Laws.
If (i) any change in accounting principles from those used in the preparation of
the financial statements of the Borrower referred to in Section 5.9 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), and such change materially affects the
calculation of any component of any financial covenant, standard or term found
in this Agreement, or (ii) there is a material change in federal or foreign tax
laws which materially affects any of the Borrower and its Subsidiaries' ability
to comply with the financial covenants, standards or terms found in this
Agreement, the Borrower and the Lenders agree to enter into negotiations in
order to amend such provisions (with the agreement of the Required Lenders or,
if required by Section 10.11, all of
63
the Lenders) so as to equitably reflect such changes with the desired result
that the criteria for evaluating any of the Borrower's and its Subsidiaries'
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. Notice. The Credit Documents constitute the entire
understanding among the Credit Parties, the Lenders, and the Administrative
Agent and supersede all earlier or contemporaneous agreements, whether written
or oral, concerning the subject matter of the Credit Documents. THIS WRITTEN
AGREEMENT TOGETHER WITH THE OTHER CREDIT DOCUMENTS REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Section 10.22. Officer's Certificates. It is not intended that any
certificate of any officer of the Borrower delivered to the Administrative Agent
or any Lender pursuant to this Agreement shall give rise to any personal
liability on the part of such officer.
Section 10.23. 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.
64
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the day and
year first above written.
BORROWER:
TRANSOCEAN OFFSHORE INC.,
a Cayman Islands Company
By: /s/ Xxxxx X. Xxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President, Finance
65
SUNTRUST BANK, ATLANTA,
As Administrative Agent and Lender
By: /s/ Xxxx X. Xxxxxx, Xx.
-------------------------------
Name: Xxxx X. Xxxxxx, Xx.
Title: Vice President
COMMITMENT AMOUNT: $45,000,000
PERCENTAGE: 11.250%
Address for Notices:
-------------------
SunTrust Bank, Atlanta
SunTrust Plaza
000 Xxxxxxxxx Xxxxxx, X.X., 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Mr. Xxxx Xxxxxx
Telephone No.: 404/000-0000
Telecopy No.: 404/827-6270
Lending Office:
--------------
SunTrust Bank, Atlanta
SunTrust Plaza
000 Xxxxxxxxx Xxxxxx, X.X., 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Mr. Xxxx Xxxxxx
Telephone No.: 404/000-0000
Telecopy No.: 404/827-6270
Payment Instructions:
--------------------
Bank Name: SunTrust Bank, Atlanta
ABA Number: 061 000 104
City, State: Atlanta, Georgia
Account Number: 908 8000 112
Attention: Xxx Xxxxxxxxx 000-000-0000
Reference: Transocean Offshore Inc.
66
ROYAL BANK OF CANADA,
As Syndication Agent and Lender
By: /s/Xxx X. Xxxxxxx
--------------------------
Name: Xxx X. Xxxxxxx
Title: Senior Manager
COMMITMENT AMOUNT: $45,000,000
PERCENTAGE: 11.250%
Address for Notices:
-------------------
Royal Bank of Canada
c/o New York Branch
Xxx Xxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxxxx
Telephone No.: 212/000-0000
Telecopy No.: 212/428-2372
with a copy to:
--------------
Royal Bank of Canada
00000 Xxxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxx Xxxxxx, Senior Manager
Telephone No.: 281/000-0000
Telecopy No.: 281/874-0081
Lending Office:
--------------
Royal Bank of Canada, New York
Xxx Xxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxx
Telephone No.: 212/000-0000
Telecopy No.: 212/428-2372
67
ROYAL BANK OF CANADA (cont)
Payment Instructions:
--------------------
Bank Name: Chase Manhattan Bank, N.A.
ABA Number: 021-00-0021
City/State: Manhattan, NY
Account Name: Royal Bank of Canada, New York
Account Number: 000-0-000000
Benef. Acct. Name: Royal Bank of Canada, New York
Benef. Account #: For Further Credit to Account #000-000-0
Attention: Xxxxxx Xxxxxxxxx
Reference: Transocean Sedco Forex (Please specify purpose for each wire)
68
BANK OF AMERICA, N.A.,
As Documentation Agent and Lender
By: /s/ Xxxx X. Xxxxx
-----------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
COMMITMENT AMOUNT: $45,000,000
PERCENTAGE: 11.250%
Address for Notices:
-------------------
Bank of America, N.A.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Vice President
Telephone No.: 713/000-0000
Telecopy No.: 713/651-4808
Lending Office:
--------------
Bank of America, N.A.
000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Customer Service Representative
Telephone No.: 214/000-0000
Telecopy No.: 214/290-9462
with a copy to:
--------------
Bank of America, N.A.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
Telephone No.: 713/000-0000
Telecopy No.: 713/651-4902
69
BANK OF AMERICA, N.A. (cont)
Payment Instructions:
--------------------
Fedwire
Bank Name: Bank of America, N.A.
City/State: Xxxxxx, XX 00000
ABA Number: ABA # 000000000
Account Number: 1282000883
Account Name: Transocean Offshore Inc.
In Favor Of: Corp. Loan Funds
70
BANK ONE, NA
(MAIN OFFICE CHICAGO),
As Senior Managing Agent and Lender
By: /s/Xxxxx Xxxxxxxxx
-----------------------------
Name: Xxxxx Xxxxxxxxx
Title: First Vice President
COMMITMENT AMOUNT: $37,500,000
PERCENTAGE: 9.375%
Address for Notices:
-------------------
Bank One, NA
000 Xxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
Telephone No.: 713/000-0000
Telecopy No.: 713/751-3760
Lending Office:
--------------
Bank One, NA
1 Bank Xxx Xxxxx
00xx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Telephone No.: 312/000-0000
Telecopy No.: 312/732-4840
Payment Instructions:
--------------------
Bank Name: Bank One, Chicago
ABA Number: ABA Transit No.:000000000
Name of Account: LSII Incoming Clearing A/c
Account No.: 481152860000
Attn: Xxxx Xxxxx
Re: Transocean (SunTrust)
71
PARIBAS,
As Senior Managing Agent and Lender
By: /s/Xxxxxx Xxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Vice President
By: /s/Xxxx X. Xxxxxxx
--------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
COMMITMENT AMOUNT: $37,500,000
PERCENTAGE: 9.375%
Address for Notices:
-------------------
Paribas
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Vice President
Xxxx Xxxxxxx
Associate
Telephone No.: 713/000-0000
Telecopy No.: 713/659-6915
Lending Office:
--------------
Paribas
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxx Xxxxx Xxxxxx, Loan Operations Manager
Telephone No.: 713/000-0000
Attn: Xxxx Xxxxxxxx/Xxxxxxx Xxxxxxx
Loan Assistants
Telephone No.: 713/000-0000/713/982-1120
Telecopy No.: 713/659-5305
72
PARIBAS (cont'd)
Payment Instructions:
--------------------
Bank Name: Bankers Trust Company New York
ABA Number: ABA# 000000000
For Account 00000000 - Paribas New York
For Further Credit to A/C # 2144-001545 Paribas Houston Agency
Ref: Transocean
73
THE BANK OF NEW YORK,
As Lender
By: /s/Xxxxx X. Xxxxx
---------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
COMMITMENT AMOUNT: $32,500,000
PERCENTAGE: 8.125%
Address for Notices:
-------------------
The Bank of New York
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxx
Telephone No.: 212/000-0000
Telecopy No.: 212/635-6434
Lending Office:
--------------
The Bank of New York
Xxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
A.A.
Telephone No.: 212/000-0000
Telecopy No.: 212/635-7923
Payment Instructions:
--------------------
Bank Name: The Bank of New York
ABA Number: ABA #000 000 000
Xxxx/Xxxxx: Xxx Xxxx, XX
Account Name: Comm Loans Dept
Account Number: GLA/111556
Attention: Xxxx Xxxxxxxx
Reference:
74
DEN NORSKE BANK ASA,
As Lender
By: /s/Xxxxxxx Xxxxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: First Vice President
By: /s/Chr. Xxxxxx Xxxxxx
----------------------------
Name: Chr. Xxxxxx Xxxxxx
Title: Assistant Vice President
COMMITMENT AMOUNT: $32,500,000
PERCENTAGE: 8.125%
Address for Notices:
-------------------
Den norske Bank ASA
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Chr. Xxxxxx Xxxxxx
Assistant Vice President
Telephone No.: 212/000-0000
Telecopy No.: 212/681-3900
Lending Office:
--------------
Den norske Bank ASA
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxxx
Assistant Treasurer
Telephone No.: 212/000-0000
Telecopy No.: 212/681-4123
Payment Instructions:
--------------------
Bank Name: Unibank
ABA Number: 026 005 694
City/State: New York, NY
Account Name: Transocean Offshore Inc.
Account Number: 100768999
Attention: Xxxx Xxxxxxx
Reference:
75
THE ROYAL BANK OF SCOTLAND PLC,
As Lender
By: /s/Xxxxx Xxxxxx
-------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
COMMITMENT AMOUNT: $32,500,000
PERCENTAGE: 8.125%
Address for Notices:
-------------------
The Royal Bank of Scotland plc
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxx
Vice President Lending
Telephone No.: 212/000-0000
Telecopy No.: 212/480-0791
Lending Office:
--------------
The Royal Bank of Scotland plc
Xxxx Xxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx De Quar
Supv Operations
Telephone No.: 212/000-0000, Ext. 260
Telecopy No.: 212/344-4065
Payment Instructions:
--------------------
Bank Name: Northern Trust International New York
ABA Number: 000-000-000
City/State: Swift Address (NCR US33
Account Name: The Royal Bank of Scotland plc
Account Number: 104083-20230
Attention:
Reference: Transocean Offshore Inc.
76
XXXXX FARGO BANK (TEXAS), N.A.,
As Lender
By: /s/Xxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President, Manager
COMMITMENT AMOUNT: $32,500,000
PERCENTAGE: 8.125%
Address for Notices:
-------------------
Xxxxx Fargo Bank (Texas), N.A.
0000 Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
Vice President
Telephone No.: 713/000-0000
Telecopy No.: 713/739-1087
Lending Office:
--------------
Xxxxx Fargo Bank
000 0xx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Telephone No.: 415/000-0000
Telecopy No.: 415/979-0675
Payment Instructions:
--------------------
Bank Name: Xxxxx Fargo Bank
ABA Number: 1210000248
City/State: San Francisco, CA
Account Name: Syndicated Loans
Account Number: 2712507201
Attention: Xxxxxxx Elring
Reference: Transocean Offshore
77
THE BANK OF TOKYO-MITSUBISHI, LTD.
As Lender
By: /s/Xxxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: VP & Manager
COMMITMENT AMOUNT: $20,000,000
PERCENTAGE: 5.000%
Address for Notices:
-------------------
The Bank of Tokyo-Mitsubishi, Ltd.
0000 Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxx
Vice President and Manager
Telephone No.: 713/000-0000
Telecopy No.: 713/655-3855
Lending Office:
--------------
The Bank of Tokyo-Mitsubishi, Ltd.
0000 Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxx
Telephone No.: 713/000-0000
Telecopy No.: 713/658-0116
Payment Instructions:
--------------------
Bank Name: The Bank of Tokyo-Mitsubishi, Ltd. - New York
ABA Number: 000000000
City/State: New York, New York
Account Name: The Bank of Tokyo-Mitsubishi, Ltd. - Houston Agency
Account Number: 00000000
Attention: Xxxxx Xxxxx
Reference: Transocean Offshore Inc.
78
NEDSHIP BANK (AMERICA), N.V.,
As Lender
By: /s/R.J.L. van Heel /s/X.X. Xxxx
--------------------------------------
Name: R.J.L. van Heel X.X. Xxxx
Title: Managing Managing
Director Director
COMMITMENT AMOUNT: $20,000,000
PERCENTAGE: 5.000%
Address for Notices:
-------------------
Nedship Bank International Inc.
(As Agents for Nedship Bank (America) N.V.)
00 Xxxxx Xxxxx Xx.
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
President
Telephone No.: 203/000-0000
Telecopy No.: 203/422-2320
Lending Office:
--------------
Nedship Bank (America) N.V.
Xxxxxxxxxxx 00
Xxxxxxxxxx, Xxxxxxx NA
Telephone No.: 0000 000-0000
Telecopy No.: 0000 000-0000
Attn: Xxxxxxx van Heel
Managing Director
with a copy to:
--------------
Nedship Bank International Inc.
(As Agents for Nedship Bank (America) N.V.)
00 Xxxxx Xxxxx Xx.
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx
Controller
Telephone No.: 203/000-0000
79
Telecopy No.: 203/422-2320
80
NEDSHIP BANK (AMERICA), N.V. (CONT)
Payment Instructions:
--------------------
Bank Name: Republic National Bank of New York
ABA Number: 000000000
City/State: New York, NY
Account Name: Nedship Bank (America) N.V.
Account Number: 608202444
Attention:
Reference: Transocean Offshore Inc.
81
WESTDEUTSCHE LANDESBANK
GIROZENTRALE, As Lender
By: /s/Xxxxxxx Xx Xxxxxx
--------------------------------
Name: Xxxxxxx Xx Xxxxxx
Title: Vice President
By: /s/Xxxxxx Xxx
--------------------------------
Name: Xxxxxx Xxx
Title: Associate
COMMITMENT AMOUNT: $20,000,000
PERCENTAGE: 5.000%
Address for Notices:
-------------------
Westdeutsche Landesbank Girozentrale, New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Telephone No.: 212/000-0000
Telecopy No.: 212/852-6307
Westdeutsche Landesbank Girozentrale, New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxx
Telephone No.: 212/000-0000
Telecopy No.: 212/852-6148
Lending Office:
--------------
Westdeutsche Landesbank Girozentrale, New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Telephone No.: 212/000-0000
Telecopy No.: 212/852-6307
00
XXXXXXXXXXXX XXXXXXXXXX
XXXXXXXXXXXX (XXXX)
Payment Instructions:
--------------------
Bank Name: Chase Manhattan Bank N.A.
ABA Number: 000-000-000
City/State: New York, NY
Account Name: Westdeutsche Landesbank Girozentrale, New York Branch
Account Number: 000-0-000000
Attention: Loan Administration
Reference: Transocean Offshore Inc.
83
