EXHIBIT 10.3
This Amendment, dated April 5, 2002, is made to the Master Option
Agreement dated April 6, 2000 (`Master Option Agreement"), by and among Xxxxxx
Offshore Inc. (formerly known as Xxxxxx Offshore LLC), a corporation organized
under the laws of the State of Delaware ("Xxxxxx"), Xxxxxx XXXX Limited, a
corporation organized under the laws of the Republic of Singapore ("Keppel
FELS") and AMFELS, Inc., a corporation organized under the laws of the State of
Texas ("AMFELS") and as amended hereby, and as the same may be further amended
from time to time.
RECITALS:
WHEREAS, Xxxxxx, Xxxxxx XXXX and AMFELS, desire to amend the Master
Option Agreement as detailed herein.
NOW, THEREFORE, in consideration of these premises, the mutual
benefit set forth herein, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, Xxxxxx, Keppel FELS and
AMFELS agree as follows:
ARTICLE II - SECOND OPTION Articles 2.1 through 2.5 shall be amended and
replaced to read as:
2.1 Extension of Option. On the terms and subject to the conditions
herein set forth, AMFELS hereby extends the irrevocable option granted to Xxxxxx
(the "Second Option"), to require AMFELS to enter into one platform construction
agreement (the "Second Construction Agreement") for construction of one
additional drilling rig (the "Second Rig") in the form attached as Exhibit 1 to
the Master Option Agreement, except that Exhibit C hereto shall be substituted
for Exhibit C thereto, in the event that the Second Option Notice (as defined)
is delivered to AMFELS with such changes or modifications thereto as may be
required pursuant to the terms hereof. The Second Construction Agreement shall
be dated as of the date of the Second Option Notice.
2.2 Exercise of Second Option. The Second Option may only be
exercised by delivery by Chiles to AMFELS of written notice of exercise of the
Second Option (the "Second Option Notice"), not later than October 6, 2002,
Xxxxxx and AMFELS shall each execute and deliver the Second Construction
Agreement no later than the date that is seven (7) days after the date of the
Second Option Notice. If Xxxxxx fails to execute the Second Option Agreement as
aforesaid, the Second Option shall thereafter lapse.
2.3 Conditions. The obligations set forth in Section 2.5 hereof shall
be subject to availability of AMFELS to whom Xxxxxx has delivered a Second
Option Notice, of sufficient production capacity.
2.4 Contract Price. The Contract Price, as defined in the Second
Construction Agreement, shall be U.S.$76,900,000 (the "AMFELS Fixed Price",
provided, however, that if the Second Option is exercised and the Consumer Price
Index (the "CPI"), at its official reading most recently preceding delivery of
the Second Option Notice (the "Exercise CPI"), shall be greater than zero, the
AMFELS Fixed Price shall be adjusted upwards at a growth rate equal to the
Exercise CPI, compounded annually and applied to the period of time beginning on
the first day of the Second Option Term and ending on the date of the Second
Option Notice. No adjustment to the AMFELS Fixed Price shall be made using the
CPI in the event that the Exercise CPI shall not be greater than zero, i.e., the
AMFELS Fixed Price shall not then be reduced. For purposes of this Section 2.4,
the "CPI" shall be the rate published by Bloomberg Financial Services or by such
other source as may be agreed upon by the parties hereto.
In the event prior to the issue of the Second Option Notice and for two months
thereafter, if US Import Tariffs are imposed on steel imports into the United
States, the price shall be adjusted according to the impact of such steel price
increases brought about by the Import Tariffs for the steel. (Best accomplished
by comparison of charges for the steel from the steel purchases for the Galileo
and then current quotations/prices.) Price change shall only be applied to such
steel prices affected.
Operation of Section Article 2.4 is illustrated by the examples set forth below.
Actual results could vary significantly from these examples.
(i) In the event that the Second Option Notice was delivered to AMFELS
six months into the second year of the Second Option Term, the
Exercise CPI was 3% then the Contract Price would increase at an
annual rate of 3% applied over one and one-half years. As a result,
the Contract Price would increase to US$80,395,105.
(ii) In the event that the Second Option Notice was delivered to AMFELS
six months into the second year of the Second Option Term and the
Exercise CPI was less than zero then no adjustment would be made in
the Contract Price, which would be unchanged, at U.S.$76,900,000.
2.5 Rig Delivery. Subject to Article 2.3 hereof, the Second
Construction Agreement shall provide for delivery of the Second Rig not later
than twenty-two (22) months after the date thereof."
ARTICLE III - THIRD OPTION, shall be amended to delete references to KFELS as
the Option shall be granted by AMFELS.
ENTIRE AGREEMENT / LIMITATION OF CHANGES. Except as specifically set forth in
this Amendment, the Original Agreement remains unchanged and in full force and
effect, including, without limitation, all provisions regarding choice of law,
forum and dispute resolution. This Amendment and the Original Master Option
Agreement constitute the Master Option Agreement as amended, and contain all of
the parties, agreements and undertakings with respect to the Master Option
Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed by their respective officers thereunto duly authorized as of the
date first written above.
XXXXXX OFFSHORE INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
KEPPEL FELS LIMITED
By: /s/ X. X. Xxxx
-----------------------------------
Name: X. X. Xxxx
Title: Managing Director
AMFELS, INC.
By: /s/ Y. Y. Chow
-----------------------------------
Name: Y. Y. Chow
Title: President
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EXHIBIT C
TITLE XI PROVISIONS
AMENDMENT NO. 1
TO
PLATFORM CONSTRUCTION AGREEMENT
BETWEEN
XXXXXX OFFSHORE INC. -- HOUSTON TEXAS
AND
AMFELS, INC. - BROWNSVILLE, TEXAS
EXHIBIT C
TITLE XI PROVISIONS
THIS AMENDMENT NO. 1 TO PLATFORM CONSTRUCTION AGREEMENT (this
"Amendment") is entered into this ___ day of ______, 2002, between AMFELS, INC.,
a Texas corporation ("Builder"), and XXXXXX OFFSHORE INC., a corporation
organized under thc laws of thc State of Delaware ("Owner"), for the
construction by Builder and purchase by Owner of one mobile, self-contained and
self-elevating Keppel FELS MOD V-B class platform (the "Platform"), between
Builder and Owner dated as of ________, 2002 (the "Original Agreement," and as
amended hereby, and as the same may be further amended and assigned from time to
time, (the "Contract").
RECITALS:
WHEREAS, Owner will issue its United States Government Ship Financing
Obligations, Galileo Series (the "Obligations"), in order to finance the
construction of the Platform, on the closing date relating to such issuance (the
"Closing Date").
WHEREAS, the United States of America, represented by the Secretary
of Transportation, acting by and through the Maritime Administrator (the
"Secretary"), on the Closing Date will guarantee the payment of the outstanding
principal and interest on the Obligations (the "Guarantee") pursuant to Title XX
xx xxx Xxxxxxxx Xxxxxx Xxx, 0000, as amended.
WHEREAS, Owner and Builder, in order to induce the Secretary to issue
the Guarantee, desire to amend the Original Agreement as detailed herein.
NOW, THEREFORE, in consideration of these premises, the mutual
benefit set forth herein, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, Owner and Builder agree
as follows:
SECTION 1. PARAGRAPH 3. The following is added as a new sub-paragraph (i) to
Paragraph 3:
(i) Records:
Builder and Owner shall keep records of construction costs paid by or
for Owners' account and furnish the secretary with a detailed statement
of these costs, distinguishing between (i) items paid or obligated to
be paid, and (ii) costs of American and foreign materials (including
services) in the hull and superstructure."
SECTION 2. PARAGRAPH 8. Paragraph 8 is deleted in its entirety and the following
inserted in lieu thereof:
"8. INSURANCE.
---------
A. Prior to the commencement of construction of the Platform, Builder
shall obtain, at its own cost and expense, and furnish certificates or
copies thereof to the Owner, the following policies of insurances:
(i) Worker's compensation (including occupational disease) and
employer's liability insurance with maritime, In Rem and U.S.
Longshoremens and Harborworkers Act coverage in accordance
with the applicable statutory requirements of the Untied
States of America, with limits on the employer liability
coverage of not less than U.S.$1,000,000 for bodily injury per
person, with umbrella excess liability limits of
U.S.$25,000,000;
(ii) Comprehensive public liability, including broad form
contractual liability coverage, with limits of not less than
U.S.$500,000 for bodily injury per occurrence, and
U.S.$500,000 for property damage per occurrence with umbrella
excess liability limits of U.S.$25,000,000; and
(iii) Automobile liability insurance covering automobile equipment
used in the performance of the work under this Contract with
limits in accordance with the rules and regulations of
U.S.$10.000,000.
All Builder insurance policies set forth in this paragraph 8A
shall, either on the face thereof or by appropriate
endorsement: (w) name (except for the policy specified in
clause (i) herein above) Builder and Owner as assureds and
provide that payments thereunder shall be made to the extent
that their respective interests may appear, (x) provide that
they shall not be cancelled or their coverage reduced, except
upon thirty (30) days' prior written notice to Builder and
Owner (if such cancellation or reduction should be caused by
Builder's failure to pay any premium when due, Owner shall
have the right to pay any such premium within such thirty (30)
days to maintain the coverage in effect for the benefit of
Owner, and Owner retains the right to be reimbursed by
Builder), (y) contain waiver of subrogation provisions
pursuant to which the insurer waives all express or implied
rights of subrogation against Builder and Owner, Builder and
Owner hereby waiving any rights to subrogate against each
other, and (z) be maintained in full force and effect by
Builder from commencement of construction until the Platform
is accepted by Owner at delivery, the obligation to name Owner
as assured and waive subrogation with respect to the policy
specified in clauses (ii) and (iii) herein above shall be
limited to those risks which are covered by Builder's
indemnity obligations under this Contract.
B. From the time the first material destined for inclusion as part of
the Platform becomes at risk and until the Platform has been physically
delivered to and accepted by Owner, the Platform and all materials,
outfit and equipment provided by Builder or Owner (including OFE) for
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and to be used in the construction thereof, shall be at the risk of the
Builder and shall be kept fully insured under a full form Builder's
Risk Policy under the latest American Institute Builder's Risk Clauses,
including loss or damage caused by strikers, locked-out workmen, or
persons taking part in labor disturbances, or riot or civil commotion,
protection and indemnity clauses and including pre-keel and tests and
trial clauses. The amount of such insurance shall be equal to the
aggregate value of the work done, including material, appurtenances,
equipment and outfit delivered to the Shipyard for the Platform at any
time during the construction period, including any such items furnished
by Owner and expenses of design and inspection, construction period
interest and the Title XI Guarantee Fee. Such coverage shall be
maintained in full force and effect from commencement of construction
until the Platform is accepted by Owner at delivery. The amount of
insurance, the terms of the policies and the underwriters shall at all
times be satisfactory to the Builder, Owner and the Secretary,
provided, however, that the amount of such coverage shall be in an
amount at least equal to the Contract Price and the
value of all OFE and shall be increased as appropriate for change
orders and alterations.
C. The Builder's Risk Policy shall contain the following provisions:
(i) All losses in excess of U.S. $100,000 shall he payable to the
Secretary for distribution by him to himself, Owner and
Builder as their interests may appear in accordance with
Section 2.05 of the Security Agreement between Owner and the
United States of America, represented by the Secretary of
Transportation, acting by and through the Maritime
Administrator (the "Secretary"), Contract No. MA--____, dated
the date hereof relating to the Platform (the "Security
Agreement").
(ii) Owner, Builder and the United States of America shall be named
assureds.
(iii) The policy shall provide no recourse against the United States
of America for payment of premium.
(iv) At least ten (10) days' prior written notice of any
cancellation or material change in the policy shall be given
to the Secretary, U.S. Department of Transportation, c/o
Maritime Administration, 000 Xxxxxxx Xxxxxx, X.X., Xxxxxxxxxx,
X.X. 00000, Attention: Chief, Division of Maritime Insurance,
and to Builder and Owner.
(v) There shall be a waiver of subrogation provision pursuant to
which the insurer waives all express and implied rights of
subrogation against Builder and Owner. Builder and Owner
hereby waive any rights to subrogate against each other.
(vi) The deductible or self-insured retention under the Builder's
Risk Policy shall be to the account of Builder in an amount to
be agreed among Builder, Owner and the Secretary, in any case
not exceeding $100,000 per occurrence. Builder shall cooperate
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in providing timelines of increasing values and other
information Owner may require to assure coverage in the
required amount.
D. (i) If the Platform or any OFE shall be damaged by any insured cause
whatsoever prior to acceptance thereof by Owner, and such damage does
not constitute an actual, compromised or constructive total loss of the
Platform, insurance proceeds shall be applied to the repair of the item
and paid in accordance with Section 2.05 of the Security Agreement, and
Owner and Builder shall then seek to mutually agree on new milestone
payments for work which has to be redone as a result of the damage
covered by the Builder's Risk Policy.
(ii) In the event of an actual, compromised or constructive total
loss of the Platform prior to delivery, this Contract shall
automatically be deemed terminated unless Builder, Owner and
the Secretary elect to construct the Platform under the
Contract. Upon any such termination, Builder shall retain all
Milestone Payments made pursuant to this Contract and the
price for that portion of the Platform then constructed for
which a Milestone Payment has not yet been made and all work
in progress (including profit thereon to Builder). All
proceeds of the Builder's Risk insurance payable as a result
of such loss shall be paid to the Secretary for distribution
to the Secretary, Owner and Builder, as their interests may
appear.
(iii) The parties acknowledge that the Secretary has certain rights
to claim for a constructive total loss and to enter into an
agreement or compromise providing for an agreed or compromised
total loss of the Platform pursuant to Section 2.05 of the
Security Agreement, with the prior written consent of Builder
and (prior to any default thereby) Owner, which consent shall
be deemed to have been given if the surveyor appointed by the
underwriters for the Builder's Risk Policy has determined that
an actual, agreed or compromised, or constructive total loss
of the Platform has occurred."
SECTION 3. PARAGRAPH 5. Changes in the Contract. Notwithstanding anything to the
contrary contained in the Contract, the Contract shall not be amended or
modified except in writing duly signed by the Builder and Shipowner with the
Secretary's prior written consent, provided that with respect to changes made or
contracted for after the Closing Date the Secretary's prior written consent
shall not be necessary, but prior written notice to the Secretary shall be
given, for (a) any mandatory changes to the Contract as a result of any
requirements of any government agency or classification society, or (b) any
non-mandatory changes that Builder and Shipowner desire to make which do not
exceed, with respect to any item of the Vessel's construction, one (1%) percent
of the Vessel's Contract Price and which do not, in the aggregate, cause the
Vessel's Contract Price to be increased more than five (5%) percent or the
delivery and completion date of the Vessel to be extended more than ten (10)
days. Notwithstanding the foregoing, Shipowner shall not present or propose to
Builder any change in the general dimensions and/or characteristics of the
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Vessel which would diminish the capacity of the Vessel to perform as originally
intended by the Contract, without the Secretary's prior written consent. Payment
procedures for all changes pursued and accomplished in accordance with this
paragraph shall be governed by the provisions of paragraph 3(d) and no payment
for any change requiring prior written approval from the Secretary shall be made
with proceeds under the Credit Agreement until such prior written consent shall
have been received.
SECTION 4. NOT USED.
SECTION 5. PARAGRAPH 7. Paragraph 7 is deleted in its entirety and the following
is inserted in lieu thereof:
"7. LIENS.
-----
Provided Builder is paid all amounts owing by Owner to Builder
pursuant to Paragraph 3 hereof, Builder, its agents and
subcontractors agree not to place or create, or permit to be
placed or created, any liens, charges or encumbrances on or
security interests as to, or pledges of, the Platform
(including any item incorporated in or made a part of the
Platform (including any item incorporated in or made part of
the Platform and not yet paid for by Owner,) or any OFE, and
any lien, charge, encumbrance or security interest so placed
or created shall be forthwith released by Builder. In the
event Builder fails to secure the removal of same, Builder
shall reimburse Owner for its costs of securing such discharge
or release (which costs shall include any expenses incurred in
connection therewith) or at Owner's sole option, by deducting
such sum from any payments due or become due to Builder under
this Contract.
Builder agrees and acknowledges that Owner has, as
contemplated by the Security Agreement between the Secretary
and the Owner dated the date hereof, granted a security
interest to the Secretary in the Equipment as defined in
paragraph 9(a) of the Contract. Owner agrees to cooperate to
execute, deliver and file any UCC filing statements or other
documents reasonably necessary or desirable for the perfection
of the Owner's and the Secretary's security interests.
On the Closing Date, and at the time of delivery of the
Platform, and from time to time as Owner shall submit a
Request for Disbursement under the Credit Agreement to the
Secretary, Builder agrees, on behalf of itself, or any party
claiming through the Builder, to execute certificates of no
liens, in form and substance satisfactory to the Secretary,
with respect to the applicable Platform, hull or component
parts for which payment is requested or with respect to all
work that has been previously been accomplished and
incorporated in and made part of the Platform."
SECTION 6. SUBORDINATION. The Builder agrees to, and does hereby fully
subordinate to the rights of the Secretary all liens and security rights and
remedies to enforce such rights which the Builder has or may have with respect
to the equipment, as defined in paragraph 9(a) of the Contract, for which title
5
has vested in the Owner pursuant to Paragraph 9(a) of the Contract. Prior to
commencement of any work under this Contract, the Builder shall provide to the
Secretary the release or subordination of any claim to a security interest or
other encumbrance, and the remedies to enforce such rights, held or claimed by
any of the Builder's lenders. Said release or subordination shall be in form and
substance satisfactory to the Secretary. In any financing statement filed by
Builder to perfect Builder's security interest in the Equipment, Builder will
include the following statement: "This security interest in favor of AMFELS,
INC. is fully subordinate to the rights and remedies granted in the collateral
by AMFELS, INC. to Xxxxxx Xxxxxxx LLC pursuant to that certain Security
Agreement between Builder and Owner dated of even date herewith and as further
assigned by Xxxxxx Xxxxxxx LLC to the Secretary of Transportation, acting by and
through the Maritime Administrator, (the "Secretary"), even if this financing
statement is for any reason filed earlier in time than the financing statement
filed by Xxxxxx Xxxxxxx or the Secretary with respect to the collateral."
SECTION 7. PARAGRAPH 3. The following is added at the end of sub-paragraph (b)
to Paragraph 3:
"Builder shall provide to Owner at the time of the notice
required by the immediately preceding paragraph, all written
substantiation of completion of the relevant Milestone event
to support all payments required to be made hereunder as Owner
may reasonably request in order to make timely application to
obtain the proceeds of the Obligations for such payments. Upon
receipt of such written substantiation from Builder, Owner
shall submit to the Secretary a Request for Disbursements
under the Credit Agreement relating to the Obligations. Upon
receipt of the Secretary's approval to such Request, Owner
shall drawdown the amount pursuant to the Credit Agreement and
payment shall be made directly from the Lender under the
Credit Agreement to Builder."
SECTION 8. PARAGRAPH 4. The following is added as a new last paragraph to
Paragraph 4:
"Builder shall permit inspection by, supply information to and
cooperate with representatives of the Secretary at its Yard
where the assembly of the Platform is taking place and at such
other yards of the Builder, its affiliates and subcontractors
where parts of the Contract or subcontracts may be performed.
Builder acknowledges that such cooperation may include, but
not be limited to, providing the Secretary (a) access to the
Platform and areas of the Yard where work related to the
Platform is being performed by Builder, its contractors and
subcontractors, at all reasonable times during normal working
hours to inspect performance of the work performed hereunder,
and to observe trials and other tests, (b) copies of detailed
construction schedules and critical paths for the Platform
along with changes to such documents as they occur, and
updated schedules of all Equipment and material received by or
delivered to the Shipyard relating to the Platform, (c) access
to contract plans and specifications for the Platform, (d)
reasonable access to the Yard's production manager or
6
supervisor, (e) information on the origination and source of
materials, (f) access to progress payment and construction
Milestone information, and (g) copies of all notices and
correspondence (i) relating to compliance with the
requirements of Paragraph 2(a)(ii) referred to in Section 3 to
Amendment No. 1 to this Contract (regarding change orders),
(iii) referred to in sub-paragraph (b) of Paragraph 3
(regarding to Milestone Payments), (iv) referred to in
Xxxxxxxxx 00 (xxxxxxxxx Xxxxx Xxxxxxx), (x) relating to
Paragraph 17 (regarding Litigation), (vi) relating to
Paragraph 10 (regarding tests and trials), and (vii) referred
to in Paragraph 16(c) (regarding Owner default). In
conjunction with any such inspections by the Secretary,
Builder will furnish, on a temporary basis, reasonable space
at its Yard for the Secretary's representatives and
communication, copying and other facilities as appropriate.
The Secretary's representatives shall comply with and follow
Builder's safety, traffic and security rules while at the
Yard, and shall not interfere in Builder's prosecution of the
work hereunder."
SECTION 9. PARAGRAPH 18. The following is added after the address of Owner in
Paragraph 18:
"If to the Secretary: United States Maritime Administration
000 Xxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Office of Ship Financing"
SECTION 10. PARAGRAPH 21. The words "or amended are added after the word
"modified" in the first sentence of Paragraph 21, and the words "and Owner" are
deleted from said first sentence of Paragraph 21, and the following inserted in
lieu thereof: ", Owner and the Secretary."
SECTION 11. PARAGRAPH 9. The first sentence of the sub-paragraph (a) of
Paragraph 9 is deleted and the following substituted therefor:
"Notwithstanding anything to the contrary contained in the
Contract, title to the Platform and all work, materials,
goods, and components, incorporated in, attached to, or
intended to be incorporated in or attached to the hull or the
Platform shall vest in Owner on the earlier of (a) when Owner
makes the next installment payment required by the Contract to
Builder following receipt of the materials, goods, or
components or performance of the work by the Builder (such
items are hereinafter called the "Equipment"), or (b) when
work is performed on any of the Equipment or materials, goods,
or components are incorporated in or attached to any of the
Equipment, whether or not such work, materials, goods, or
components have been paid for by the Shipowner. Title to OFE
paid for by the Owner shall be in the Owner. Risk with respect
7
to the hull or the Platform and all materials destined for
inclusion as part of the Platform (including OFE) shall be
governed by the provisions of Paragraph 8, as amended."
SECTION 12. PARAGRAPH 16.
(a) Subparagraph 16(b) is redesignated as subparagraph 16(b)(i)
and the following is added as the last sentence thereof:
"Notwithstanding anything in this Contract to the contrary,
specifically including but not limited to this Paragraph 16,
Owner may not terminate or cancel this Contract without the
prior written consent of the Secretary."
(b) A new subparagraph 16(b)(ii) is added as follows:
"(b)(ii) Upon the Owner's election to enforce its rights and
remedies under subparagraph (b)(i) of this paragraph 16, the
Owner may, with respect to Equipment for which title has not
yet passed under section 9(a) of the Contract, request that
Builder assign all its right, title and interest in any of
such Equipment and in any of the purchase orders for such
Equipment to the extent in each case that such purchase orders
are assignable. Upon receipt of such an Owner's request,
Builder shall forthwith effectuate the assignments to the
Owner and Owner shall reimburse the Builder for any amounts
that Builder has paid for such Equipment or under such
purchase orders. To the extent that money is owed by the
Builder to the vendors of any Equipment which the Owner wishes
to purchase under an assignment from the Builder including by
assignment of purchase orders, the Owner shall pay the vendors
directly for any balance due. The Builder's obligations and
the Owner's rights under this subparagraph 16(b)(ii) shall
survive any termination of this Agreement by the Owner under
subparagraph 16(b)(i) and shall constitute one of Owner's
remedies in the event of a Builder's Default. Builder agrees
not to offer any of the Equipment referred to herein without
first offering to sell the Equipment to Owner under the
conditions stated herein."
SECTION 13. PARAGRAPH 16.
(a) The words "seven (7)" appearing in Paragraph 16(c)(i) are
changed to "ten (10) business."
(b) The following is added as a new First sentence to Paragraph
16(c)(i):
"Builder shall give Owner and the Secretary notice of any
default by Owner under this Paragraph 16(c)(i)."
8
(c) The following is added as a new sub-paragraph (e) to Paragraph
16:
"(e) Notwithstanding anything to the contrary contained in
this Contract, Builder hereby grants the Secretary thirty (30)
days from the receipt of the notice referred to in the first
sentence of clause (i) of sub-paragraph (c) of this Paragraph
16 to cure any default under this Contract, and Builder agrees
to take no action to enforce its rights pursuant to this
Contract, including, without limitation, its right to
terminate pursuant to sub-paragraph (d) of this Paragraph 16,
until the elapse of said 30 (30) days."
(d) A new Paragraph 16(f) is added to read as follows:
"(f) Equipment Proceeds. In the event that prior to delivery
of the Platform and following the occurrence or during the
continuation of any material default by the Builder as defined
in Subparagraph 16(a) of the Construction Contract which would
permit the Owner to terminate the Construction Contract, the
Secretary shall have the right to sell the Equipment. Any
proceeds the Secretary receives from the sale of the
Equipment, after deducting any fees or costs it incurs in
connection with the enforcement of its rights under the
Security Agreement, shall be distributed promptly to the
Secretary for payment of all amounts secured by the Security
Agreement with any remainder to be paid to the Builder and the
Owner as their interests appear. In the event that prior to
delivery of the Platform and following the occurrence or
during the continuation of any material default by the Owner
as defined in Subparagraph 16(b) of the Construction Contract
which would permit the Builder to terminate the Construction
Contract, and provided that the Builder is not in material
default under the Construction Contract, Builder shall have
the right to sell the Equipment subject to the Secretary's
first priority security interest in all of Owner's right,
title and interest in and to the Equipment to the full extent
and in accordance with all procedures as set forth in Article
9 of the Texas UCC. Nothing herein shall relieve Owner or
Builder of their respective obligations and liabilities under
Paragraph 16 of the Construction Contract."
SECTION 14. PARAGRAPH 16. A new Paragraph 16(g) is added to read as follows:
"(g) Notwithstanding anything to the contrary in
sub-paragraphs (b), (c), (d) or (e) of this Paragraph 16, if a
Default exists and is continuing under the Security Agreement,
Owner shall not exercise any right, remedy or action pursuant
to this Paragraph 16, including, without limitation,
termination of this Contract or any sale or disposition of the
Platform, without the prior written consent of the Secretary."
9
SECTION 15. DUTIES, OBLIGATIONS, AND LIABILITIES OF THE OWNER
Nothing in this Amendment shall be construed to modify, amend, waive
or supercede the duties, obligations and liabilities of Owner to Builder under
the Original Agreement, whether accruing prior to or after the date hereof,
including, without limitation, the obligation of the Owner to pay all amounts
owing under the Contract to Builder as and when due. Without limitation as to
the generality of the foregoing, nothing herein shall be deemed to allow Owner
to pay such sums solely from the proceeds of the loan made under the Credit
Agreement.
SECTION 16. DISTINCT OBLIGATIONS
Builder hereby agrees and acknowledges that the obligations of Owner
under the Contract with regard to the Platform are separate, distinct and
independent of any other obligation or agreement of Owner to or with Builder in
connection with any other transaction, and that a default by Owner under such
other obligation or agreement in connection with any other such transaction
shall not in any way affect the obligations of Builder under the Contract with
regard to the Platform or permit Builder to exercise any right of set-off or
other remedy (all of which Builder expressly waives and agrees not to assert
with respect to the Contract) which could materially adversely affect the
Contract, the Platform or the construction thereof.
SECTION 17. SHIPYARD PLANS. Upon the delivery of the Platform, or earlier if
feasible, upon the Secretary's request. Shipyard and Shipowner agree to submit
to the Secretary one set of Shipyard plans, designs and specifications in form
and substance satisfactory to the Secretary, for the Platform as built.
SECTION 18. ENTIRE AGREEMENT; LIMITATION OF CHANGES. Except as specifically set
forth in this Amendment, the Original Agreement remains unchanged and in full
force and effect, including, without limitation, all provisions regarding choice
of law, forum and dispute resolution. This Amendment and the Original Agreement
constitute the Construction Contract, and contain all of the parties' agreements
and undertakings with respect to the Construction Contract.
10
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on their behalf by their respective duly authorized representatives on
the date first shown above.
AMFELS, INC.
By:
-------------------------------------
Name:
Title:
XXXXXX OFFSHORE INC.
By:
-------------------------------------
Name:
Title:
11
