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EXHIBIT 10.1
PURCHASE AGREEMENT
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R&B FALCON CORPORATION
$300,000,000
300,000 UNITS CONSISTING OF
300,000 SHARES OF
13 7/8% SENIOR CUMULATIVE REDEEMABLE PREFERRED STOCK
AND
WARRANTS TO PURCHASE 10,500,000 SHARES OF COMMON STOCK
APRIL 15, 1999
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XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
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$300,000,000
300,000 UNITS CONSISTING OF
300,000 SHARES OF 13-7/8% SENIOR CUMULATIVE REDEEMABLE PREFERRED STOCK
AND WARRANTS TO PURCHASE 10,500,000 SHARES OF COMMON STOCK
R&B FALCON CORPORATION
PURCHASE AGREEMENT
April 15, 1999
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
AS INITIAL PURCHASER
000 XXXX XXXXXX
XXX XXXX, XXX XXXX 00000
Dear Sirs:
R&B Falcon Corporation, a Delaware corporation (the "COMPANY"),
proposes to issue and sell to Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation (the "INITIAL PURCHASER"), 300,000 shares, or an aggregate of
$300,000,000 in liquidation preference, of its 13-7/8% Senior Cumulative
Redeemable Preferred Stock, liquidation preference $1,000 per share and par
value $0.01 per share (the "RESTRICTED PREFERRED STOCK"), and warrants (the
"WARRANTS") to purchase 10,500,000 shares of the Company's common stock, par
value $0.01 per share (the "WARRANT SHARES"), to be offered in 300,000 units,
each consisting of one share of Restricted Preferred Stock, and one warrant,
each entitling the holder thereof to purchase 35 shares of the Company's common
stock (the "UNITS"), subject to the terms and conditions set forth herein. The
Restricted Preferred Stock is to be issued pursuant to the provisions of a
Certificate of Designation forming part of the Company's Certificate of
Incorporation (the "CERTIFICATE OF DESIGNATION") to be filed with the Secretary
of State of the State of Delaware on or before the Closing Date (as defined
below). The Warrants are to be issued pursuant to the provisions of a Warrant
Agreement (the "WARRANT AGREEMENT") to be dated as of the Closing Date. The
Units are to be issued pursuant to a Unit Agreement (the "UNIT AGREEMENT") to
be dated as of the Closing Date. The Restricted Preferred Stock and the New
Preferred Stock (as defined below), issuable in exchange therefor, are
collectively referred to herein as the "PREFERRED STOCK." The Preferred Stock
may be exchanged, at the option of the Company, for subordinated debentures of
the Company with the terms set forth in the Offering Memorandum (the "EXCHANGE
DEBENTURES"). The Units, the Preferred Stock, the Exchange Debentures and the
Warrants are collectively referred to herein as the "SECURITIES." Capitalized
terms used but not defined herein shall have the meanings given to such terms
in the Offering Memorandum.
1. OFFERING MEMORANDUM. The Securities will be offered and sold
to the Initial Purchaser pursuant to one or more exemptions from the
registration requirements under the Securities Act of 1933, as amended (the
"ACT"). The Company has prepared an offering memorandum, dated April 15, 1999
(the "OFFERING MEMORANDUM"), relating to the Securities.
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Upon original issuance thereof, and until such time as the same
is no longer required pursuant to the Certificate of Designation, the
Restricted Preferred Stock or the Exchange Debentures (and all securities
issued in exchange therefor, in substitution thereof or upon conversion
thereof) shall bear the following legend:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL
INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"),
OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES
ACT (AN "IAI"));
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (D) TO AN IAI
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE [TRANSFER AGENT] [TRUSTEE]
A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE
OBTAINED FROM THE [TRANSFER AGENT] [TRUSTEE]) AND AN OPINION OF
COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER) OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT, AND IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
ANY OTHER APPLICABLE JURISDICTION; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND."
Upon original issuance thereof, and until such time as the same is no
longer required pursuant to the Warrant Agreement, the Warrants and the Warrant
Shares (and all securities issued in exchange therefor, in substitution thereof
or upon conversion thereof) shall bear the following legend:
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"THESE WARRANTS (OR THEIR PREDECESSORS) AND THE SHARES OF COMMON STOCK
ISSUABLE UPON THE EXERCISE HEREIN HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN
THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB") OR
(B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(A), (1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT
(AN "IAI")),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER
THESE WARRANTS OR WARRANT SHARES EXCEPT (A) TO THE ISSUER OR ANY OF
ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES
IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES
ACT, (D) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE WARRANT
AGENT A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THESE SECURITIES (THE FORM OF
WHICH CAN BE OBTAINED FROM THE WARRANT AGENT) AND AN OPINION OF
COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER) OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH
THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
ANY OTHER APPLICABLE JURISDICTION, AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND."
2. AGREEMENTS TO SELL AND PURCHASE. On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained herein, the Company agrees to
issue and sell to the Initial Purchaser, and the Initial Purchaser agrees to
purchase from the Company, the aggregate principal amount of Units at a
purchase price equal to 96.50% of the aggregate offering price thereof (the
"PURCHASE PRICE").
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3. TERMS OF OFFERING. The Initial Purchaser has advised, and
represents and warrants to, the Company that the Initial Purchaser will make
offers and sales (the "EXEMPT RESALES") of the Securities purchased hereunder
on the terms set forth in the Offering Memorandum, as amended or supplemented,
solely to persons whom the Initial Purchaser reasonably believes to be
"qualified institutional buyers" (as defined in Rule 144A promulgated under the
Act) ("QIBs") (QIBs being referred to herein as the "ELIGIBLE PURCHASERS"). The
Initial Purchaser will offer the Securities to Eligible Purchasers initially at
a price set forth on the cover page of the Offering Memorandum.
Holders (including subsequent transferees) of the Restricted
Preferred Stock and Warrants will have the registration rights set forth in
either the Preferred Stock registration rights agreement (the "PREFERRED STOCK
REGISTRATION RIGHTS AGREEMENT") or the Warrant registration rights agreement
(the "WARRANT REGISTRATION RIGHTS AGREEMENT"), each to be dated the Closing
Date, in substantially the forms of Exhibit A and Exhibit B hereto, for so long
as such Restricted Preferred Stock, Exchange Debentures and/or Warrants
constitute "TRANSFER RESTRICTED SECURITIES" (as defined in the Preferred Stock
Registration Rights Agreement or the Warrant Registration Rights Agreement, as
applicable). Pursuant to the Preferred Stock Registration Rights Agreement, the
Company will agree to file (i) with the Securities and Exchange Commission (the
"COMMISSION") under the circumstances set forth therein (A) a registration
statement under the Act (the "EXCHANGE OFFER REGISTRATION STATEMENT") relating
to a new series of the Company's Preferred Stock of like amounts having
identical terms (the "NEW PREFERRED STOCK") to be offered in exchange for the
Restricted Preferred Stock, or if the Preferred Stock has been exchanged for
Exchange Debentures, subordinated debentures having identical terms (the "NEW
EXCHANGE DEBENTURES") (such offer to exchange being referred to as the
"EXCHANGE OFFER") and/or (B) a shelf registration statement pursuant to Rule
415 under the Act (the "PREFERRED STOCK SHELF REGISTRATION STATEMENT" and,
together with the Exchange Offer Registration Statement, the "REGISTRATION
STATEMENTS") relating to the resale by certain holders of the Restricted
Preferred Stock or Exchange Debentures, as applicable, and (ii) to use its
reasonable best efforts to cause such Registration Statements to be declared
and remain effective and usable for the periods specified in the Preferred
Stock Registration Rights Agreement and to consummate the Exchange Offer.
Pursuant to the Warrant Registration Rights Agreement, the Company will agree
to file (i) with the Commission under the circumstances set forth therein a
shelf registration statement pursuant to Rule 415 under the Act (the "WARRANT
SHELF REGISTRATION STATEMENT") relating to the resale by certain holders of the
Warrants or the Warrant Shares and (ii) to use its reasonable best efforts to
cause such Warrant Shelf Registration Statement to be declared and remain
effective and usable for the periods specified in the Warrant Registration
Rights Agreement. This Agreement, the Certificate of Designation forming part
of the Company's Certificate of Incorporation, the Indenture relating to the
Exchange Debentures, the Warrant Agreement, the Units, the Unit Agreement, the
Restricted Preferred Stock, Exchange Debentures, the Warrants, the Preferred
Stock Registration Rights Agreement and the Warrant Registration Rights
Agreement are referred to herein as the "OPERATIVE DOCUMENTS."
4. DELIVERY AND PAYMENT.
(a) Delivery of, and payment of the Purchase Price for, the
Securities shall be made at the offices of Akin, Gump, Strauss, Xxxxx & Xxxx,
L.L.P., in Houston, Texas, or such other location as may be mutually
acceptable. Such delivery and payment shall be made at 9:00 a.m. New York City
time, on April 22, 1999 or at such other time or date as shall be agreed upon
by the Initial Purchaser and the Company in writing. The time and date of such
delivery and the payment for the Securities are herein called the "CLOSING
DATE."
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(b) The Securities shall each be represented by definitive
global certificates and shall be issued in such authorized denominations and in
such names as the Initial Purchaser shall request no later than two business
days prior to the Closing Date. The Company shall deliver the Securities, with
any transfer taxes thereon duly paid by the Company against payment by the
Initial Purchaser of the Purchase Price thereof by wire transfer in same day
funds to the order of the Initial Purchaser through the facilities of The
Depository Trust Company ("DTC"). The certificates representing the Units, the
Restricted Preferred Stock and the Warrants shall be made available for
inspection not later than 9:30 a.m., New York City time, on the business day
prior to the Closing Date at the office of DTC or its designated custodian (the
"DESIGNATED OFFICE").
5. AGREEMENTS OF THE COMPANY. The Company hereby agrees with
the Initial Purchaser as follows:
(a) To advise the Initial Purchaser promptly and, if
requested by the Initial Purchaser, confirm such advice in writing, (i) of the
issuance by any state securities commission of any stop order suspending the
qualification or exemption from qualification of any Securities for offering or
sale in any jurisdiction designated by the Initial Purchaser pursuant to
Section 5(e) hereof, or the initiation of any proceeding by any state
securities commission or any other federal or state regulatory authority for
such purpose and (ii) of the happening of any event during the period referred
to in Section 5(c) below that makes any statement of a material fact made in
the Offering Memorandum untrue or that requires any additions to or changes in
the Offering Memorandum in order to make the statements therein not misleading.
The Company shall use its best efforts to prevent the issuance of any stop
order or order suspending the qualification or exemption of any Securities
under any state securities or Blue Sky laws and, if at any time any state
securities commission or other federal or state regulatory authority shall
issue an order suspending the qualification or exemption of any Securities
under any state securities or Blue Sky laws, the Company shall use its best
efforts to obtain the withdrawal or lifting of such order at the earliest
possible time.
(b) To furnish the Initial Purchaser and those persons
identified by the Initial Purchaser to the Company as many copies of the
Offering Memorandum, and any amendments or supplements thereto, as the Initial
Purchaser may reasonably request for the time period specified in Section 5(c).
Subject to the Initial Purchaser's compliance with their representations and
warranties and agreements set forth in Section 7 hereof, the Company consents
to the use of the Offering Memorandum, and any amendments and supplements
thereto required pursuant hereto, by the Initial Purchaser in connection with
Exempt Resales.
(c) During such period as in the opinion of counsel for the
Initial Purchaser an Offering Memorandum is required by law to be delivered in
connection with Exempt Resales by the Initial Purchaser and in connection with
market-making activities of the Initial Purchaser for so long as any Securities
are outstanding, (i) not to make any amendment or supplement to the Offering
Memorandum of which the Initial Purchaser shall not previously have been
advised or to which the Initial Purchaser shall reasonably object after being
so advised and (ii) to prepare promptly upon the Initial Purchaser's reasonable
request based on the opinion of its counsel, any amendment or supplement to the
Offering Memorandum which may be necessary or advisable in connection with such
Exempt Resales or such market-making activities.
(d) If, during the period referred to in Section 5(c)
above, any event shall occur or condition shall exist as a result of which, in
the opinion of counsel to the Initial Purchaser, it becomes necessary to amend
or supplement the Offering Memorandum in order to make the statements therein,
in the light of the circumstances when such Offering Memorandum is delivered to
an Eligible
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Purchaser, not misleading, or if, in the opinion of counsel to the Initial
Purchaser, it is necessary to amend or supplement the Offering Memorandum to
comply with any applicable law, forthwith to prepare an appropriate amendment
or supplement to such Offering Memorandum so that the statements therein, as so
amended or supplemented, will not, in the light of the circumstances when it is
so delivered, be misleading, or so that such Offering Memorandum will comply
with applicable law, and to furnish to the Initial Purchaser and such other
persons as the Initial Purchaser may designate such number of copies thereof as
the Initial Purchaser may reasonably request.
(e) Prior to the sale of all Securities pursuant to Exempt
Resales as contemplated hereby, to cooperate with the Initial Purchaser and
counsel to the Initial Purchaser in connection with the registration or
qualification of the Securities for offer and sale to the Initial Purchaser and
pursuant to Exempt Resales under the securities or Blue Sky laws of such
jurisdictions as the Initial Purchaser may reasonably request and to continue
such registration or qualification in effect so long as required for Exempt
Resales and to file such consents to service of process or other documents as
may be necessary in order to effect such registration or qualification;
provided, however, that the Company shall not be required in connection
therewith to qualify as a foreign corporation in any jurisdiction in which it
is not now so qualified or to take any action that would subject it to general
consent to service of process or taxation other than as to matters and
transactions relating to the Offering Memorandum or Exempt Resales, in any
jurisdiction in which it is not now so subject.
(f) So long as the Preferred Stock, Exchange Debentures or
Warrants are outstanding, (i) to mail and make generally available as soon as
practicable after the end of each fiscal year to the record holders of the
Securities such financial reports of the Company and its subsidiaries as are
required to be made available pursuant to the Certificate of Designation (or,
if the Preferred Stock has been exchanged for Exchange Debentures, the
Indenture), the Warrant Agreement and the federal securities laws of the United
States and (ii) to mail or make generally available as soon as practicable
after the end of each quarterly period (except for the last quarterly period of
each fiscal year) to such record holders to the extent so required, such
quarterly financial reports of the Company and its subsidiaries as may be
specified therein or required by such laws.
(g) So long as the Preferred Stock, Exchange Debentures or
Warrants are outstanding, to furnish upon request to the Initial Purchaser as
soon as available copies of all reports or other communications furnished by
the Company to its security holders or furnished to or filed with the
Commission or any national securities exchange on which any class of securities
of the Company is listed and such other publicly available information
concerning the Company as the Initial Purchaser may reasonably request.
(h) So long as any of the Securities remain outstanding and
during any period in which the Company is not subject to Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), to make
available to any holder of Securities in connection with any sale thereof and
any prospective purchaser of such Securities from such holder, the information
("RULE 144A INFORMATION") required by Rule 144A(d)(4) under the Act.
(i) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause to
be paid all expenses incident to the performance of the obligations of the
Company under this Agreement, including: (i) the fees, disbursements and
expenses of counsel to the Company and accountants of the Company in connection
with the sale and delivery of the Securities to the Initial Purchaser and
pursuant to Exempt Resales, and all other fees and expenses in connection with
the preparation, printing, filing and distribution of the Offering
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Memorandum and all amendments and supplements to the foregoing (including
financial statements), including the mailing and delivering of copies thereof
to the Initial Purchaser and persons designated by it in the quantities
specified herein, (ii) all costs and expenses related to the transfer and
delivery of the Securities to the Initial Purchaser and pursuant to Exempt
Resales, including any transfer or other taxes payable thereon, (iii) all costs
of printing or producing this Agreement, the other Operative Documents and any
other agreements or documents in connection with the offering, purchase, sale
or delivery of the Securities, (iv) all expenses in connection with the
registration or qualification of the Securities for offer and sale under the
securities or Blue Sky laws of the several states and all costs of printing or
producing any preliminary and supplemental Blue Sky memoranda in connection
therewith (including the filing fees and fees and disbursements of counsel for
the Initial Purchaser in connection with such registration or qualification and
memoranda relating thereto), (v) the cost of printing certificates representing
the Securities, (vi) all expenses and listing fees in connection with the
application for quotation of the Securities in The PORTAL Market ("PORTAL") of
The Nasdaq Stock Market, Inc. ("Nasdaq"), (vii) the fees and expenses of the
Trustee and the Trustee's counsel in connection with the Indenture relating to
the underlying Exchange Debentures, (viii) the costs and charges of any
transfer agent, registrar and/or depositary (including DTC), (ix) all costs and
expenses of the Exchange Offer and any Registration Statement, as set forth in
the Preferred Stock Registration Rights Agreement or the Warrant Registration
Rights Agreement, and (x) and all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section.
(j) To use its best efforts, with the cooperation of the
Initial Purchaser, to effect the inclusion of the Securities on PORTAL and to
maintain the listing of the Securities on PORTAL for so long as any Securities
are outstanding. (k) To use its best efforts to maintain the listing of the
Company's common stock on the New York Stock Exchange for a period of three
years after the date of this Agreement.
(l) To obtain, with the cooperation of the Initial Purchaser,
the approval of DTC for "book-entry" transfer of the Securities, and to comply
with all of its agreements set forth in the representation letters of the
Company to DTC relating to the approval of the Securities for "book-entry"
transfer.
(m) Except as described or incorporated by reference in the
Offering Memorandum, during the period beginning on the date hereof and
continuing to and including the Closing Date, not to offer, sell, contract to
sell or otherwise transfer or dispose of any securities of the Company or any
warrants, rights or options to purchase or otherwise acquire securities of the
Company substantially similar to the Securities (other than (i) the Exchange
Debentures, (ii) commercial paper issued in the ordinary course of business
(iii) outstanding employee stock options or options issuable under existing
employee benefit plans and (iv) acquisitions of stock or assets for
consideration of not more than an aggregate of 1,000,000 shares of common stock
of the Company), without the prior written consent of the Initial Purchaser.
(n) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) that
would be integrated with the sale of the Securities to the Initial Purchaser or
pursuant to Exempt Resales in a manner that would require the registration of
any such sale of the Securities under the Act.
(o) Not to voluntarily claim, and to actively resist any
attempts to claim, the benefit of any usury laws against the holders of any
Securities.
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(p) To comply with all of its agreements set forth in the
Warrant Agreement, the Unit Agreement, the Preferred Stock Registration Rights
Agreement, the Warrant Registration Rights Agreement and, to the extent the
Company exchanges the Preferred Stock for the Exchange Debentures, the
Indenture.
(q) To use its best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by it prior
to the Closing Date and to satisfy all conditions precedent to the delivery of
the Securities.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
As of the date hereof, the Company represents and warrants to, and agrees with,
the Initial Purchaser that:
(a) The Offering Memorandum does not, and any supplement or
amendment to it will not, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that the representations and warranties
contained in this paragraph (a) shall not apply to statements in or omissions
from the Offering Memorandum (or any supplement or amendment thereto) based
upon information relating to the Initial Purchaser furnished to the Company in
writing by the Initial Purchaser expressly for use therein. No stop order
preventing the use of the Offering Memorandum, or any amendment or supplement
thereto, or any order asserting that any of the transactions contemplated by
this Agreement are subject to the registration requirements of the Act, has
been issued.
(b) Each of the Company and its subsidiaries has been duly
incorporated, is validly existing as a corporation or limited liability company
in good standing under the laws of its jurisdiction of incorporation or
formation and has the corporate or limited liability company power and
authority to carry on its business as described in the Offering Memorandum and
to own, lease and operate its properties, and each is duly qualified and is in
good standing as a foreign corporation or entity authorized to do business in
each jurisdiction in which the nature of its business or its ownership or
leasing of property requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"), as the case may
be. Each of the subsidiaries of the Company listed on Schedule B hereto (the
"SUBSIDIARIES"), which Subsidiaries in the aggregate directly own substantially
all of the assets held by the Company and all of its subsidiaries on a
consolidated basis and which constitute all of the Company's "significant
subsidiaries" (as such term is defined in Regulation S-X under the Act), has
been duly incorporated, is validly existing as a corporation or limited
liability company in good standing under the laws of its jurisdiction of
incorporation or formation and has the corporate or limited liability company
power and authority to carry on its business and to own, lease and operate its
properties, and each is duly qualified and is in good standing as a foreign
corporation or entity authorized to do business in each jurisdiction in which
the nature of its business or its ownership or leasing of property requires
such qualification, except where the failure to be so qualified would not have
a Material Adverse Effect.
(c) All outstanding shares of capital stock of the Company
and its subsidiaries have been duly authorized and validly issued and are fully
paid, non-assessable and not subject to any preemptive or similar rights and
after giving effect to the offering contemplated hereby the Preferred Stock,
when issued and delivered to the Initial Purchaser against payment therefor as
provided by this Agreement, will be validly issued, fully paid and
non-assessable, and the issuance of such Preferred Stock will not be subject to
any preemptive or similar rights.
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(d) There are no authorized or outstanding subscriptions,
options, warrants, preemptive rights, rights of first refusal or other rights
to purchase, or equity or debt securities convertible or exchangeable into or
exchangeable or exercisable for, any capital stock of the Company or any of its
subsidiaries other than (1) those described or incorporated by reference in the
Offering Memorandum (2) outstanding employee stock options or options issuable
under existing employee benefit plans, (3) contingent or executory purchase
price payments or adjustments in connection with stock or asset acquisitions,
and (4) the right of Nisho Iwai to acquire an equity interest in the subsidiary
that owns the Iolair.
(e) There are no agreements, understandings or arrangements
among the Company or any other person regarding the ownership or disposition of
capital stock of the Company or any of its subsidiaries for election of
directors except (1) as described in the Certificate of Designation and the
Offering Memorandum or incorporated by reference in the Offering Memorandum,
(2) employee stock options or options issuable under existing employee benefit
plans, (3) contingent or executory purchase price payments or adjustments in
connection with stock or asset acquisitions, and (4) the right of Nisho Iwai to
acquire an equity interest in the subsidiary that owns the Iolair.
(f) This Agreement has been duly authorized, executed and
delivered by the Company.
(g) The form of the Indenture has been duly authorized by the
Company and, on the Exchange Date, the Indenture will have been validly
executed and delivered by the Company. When the Indenture has been duly
executed and delivered by the Company, the Indenture will be a valid and
binding agreement of the Company, enforceable against the Company in accordance
with its terms except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency, fraudulent transfer or similar laws affecting
creditors' rights generally (the "ENFORCEABILITY EXCEPTIONS") and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability. On the Closing Date, the
Indenture will conform as to form in all material respects to the requirements
of the Trust Indenture Act of 1939, as amended (the "TIA" or "TRUST INDENTURE
ACT"), and the rules and regulations of the Commission applicable to an
indenture which is qualified thereunder.
(h) On the Closing Date, the Certificate of Designation
relating to the Restricted Preferred Stock, the New Preferred Stock and any
additional shares of Preferred Stock issued as dividends in accordance with the
terms of the Certificate of Designation (the "DIVIDEND SHARES") will have been
duly authorized by the Company. On the Closing Date, the Certificate of
Designation will have been duly filed with the Secretary of State of the State
of Delaware, and the Amended and Restated Certificate of Incorporation of the
Company, including the Certificate of Designation forming part thereof, will
set forth the rights, preferences and priorities of the Preferred Stock and the
Dividend Shares.
(i) The Unit Agreement has been duly authorized by the
Company and, when executed and delivered by the Company, will constitute a
valid and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, subject to (x) the Enforceability
Exceptions and (y) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability.
(j) The Warrant Agreement has been duly authorized by the
Company and, when executed and delivered by the Company, will constitute a
valid and legally binding agreement of
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the Company, enforceable against the Company in accordance with its terms
subject to (x) the Enforceability Exceptions and (y) rights of acceleration and
the availability of equitable remedies may be limited by equitable principles
of general applicability.
(k) The Units have been duly authorized and, when issued and
delivered by the Company against payment therefor in accordance with the terms
of this Agreement, will be validly issued, fully paid and non-assessable and
free of any preemptive or similar rights. On the Closing Date, the Units will
conform as to legal matters to the description thereof contained in the
Offering Memorandum.
(l) The Restricted Preferred Stock has been duly authorized
and, when issued and delivered by the Company against payment therefor in
accordance with the terms of this Agreement, will be validly issued, fully paid
and non-assessable and free of any preemptive or similar rights. On the Closing
Date, the Restricted Preferred Stock will conform as to legal matters to the
description thereof contained in the Offering Memorandum.
(m) The Dividend Shares have been duly authorized and, if and
when issued and delivered by the Company in accordance with the terms of the
Certificate of Designation, will be validly issued, fully paid and
non-assessable and free of any preemptive or similar rights. The Company will
have reserved for issuance, and duly authorized the issuance of, the maximum
number of Dividend Shares issuable pursuant to the terms of the Certificate of
Designation.
(n) On the Closing Date, the New Preferred Stock will have
been duly authorized by the Company and upon its issuance in accordance with
the terms of the Preferred Stock Registration Rights Agreement, the New
Preferred Stock will be validly issued fully paid and non-assessable and free
of any preemptive or similar rights.
(o) The Warrants have been duly authorized by the Company
and, when issued and delivered by the Company against payment therefor in
accordance with the terms of the Warrant Agreement, will be validly issued,
fully paid and non-assessable and free of any preemptive or similar rights.
(p) The Warrant Shares will have been duly authorized by the
Company. Upon the exercise of the Warrants and payment of the exercise price
pursuant to the terms thereof (including payment by cashless exercise), the
Warrant Shares will be validly issued and will be fully paid, non-assessable
and free of any preemptive or similar rights.
(q) Prior to any exchange of the Preferred Stock for Exchange
Debentures, the Exchange Debentures will have been duly authorized by the
Company. If and when the Exchange Debentures are issued, executed and
authenticated in accordance with the terms of the Indenture and the Certificate
of Designation, the Exchange Debentures will be entitled to the benefits of the
Indenture and will be the valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as to
(i) the Enforceability Exceptions and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(r) Each of the Preferred Stock Registration Rights Agreement
and the Warrant Registration Rights Agreement has been duly authorized by the
Company and, on the Closing Date, will have been duly executed and delivered by
the Company. When the Preferred Stock Registration Rights Agreement and the
Warrant Registration Rights Agreement have been duly executed and delivered,
each of the Preferred Stock Registration Rights Agreement and the Warrant
Registration Rights Agreement
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will be valid and binding agreements of the Company, enforceable against the
Company in accordance with their terms except as to (i) the Enforceability
Exceptions and (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability. On
the Closing Date, the Preferred Stock Registration Rights Agreement and the
Warrant Registration Rights Agreement will conform as to legal matters to the
description thereof in the Offering Memorandum.
(s) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by-laws or in default in the performance
of any obligation, agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries to which the Company or its
subsidiaries is a party or by which the Company or its subsidiaries, or their
respective property, is bound.
(t) The execution, delivery and performance of this Agreement
and the other Operative Documents by the Company, compliance by the Company
with all provisions hereof and thereof and the consummation of the transactions
contemplated hereby and thereby will not (i) require any consent, approval,
authorization or other order of, or qualification with, any court or
governmental body or agency (except such as may be required under the
securities or Blue Sky laws of the various states), (ii) conflict with or
constitute a breach of any of the terms or provisions of, or a default under,
the charter or by-laws of the Company or its subsidiaries or any indenture,
loan agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a whole, to which the
Company or its subsidiaries is a party or by which the Company or its
subsidiaries, or their respective property is bound, (iii) violate or conflict
with any applicable law or any rule, regulation, judgment, order or decree of
any court or any governmental body or agency having jurisdiction over the
Company or its subsidiaries or their respective property, (iv) result in the
imposition or creation of (or the obligation to create or impose) a lien under,
any agreement or instrument to which the Company or its subsidiaries is a party
or by which the their respective property is bound (other than liens granted
under or contemplated by the Operative Documents), or (v) result in the
termination, suspension or revocation of any Authorization (as defined below)
of the Company or result in any other impairment of the rights of the holder of
any such Authorization.
(u) There are no legal or governmental proceedings pending
or, to the knowledge of the Company or any of its subsidiaries, threatened, to
which the Company or its subsidiaries are a party or to which any of their
respective property is subject, which, if determined adversely against the
Company or its subsidiaries, would, singly or in the aggregate, have a Material
Adverse Effect.
(v) Except as disclosed in the Offering Memorandum, neither
the Company nor any of its subsidiaries has violated any foreign, federal,
state or local law or regulation relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("ENVIRONMENTAL LAWS"), any provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or any provisions
of the Foreign Corrupt Practices Act or the rules and regulations promulgated
thereunder, except for such violations which, singly or in the aggregate, would
not have a Material Adverse Effect.
(w) Except as disclosed in the Offering Memorandum, neither
the Company nor any of its subsidiaries are obligated for costs or liabilities
associated with Environmental Laws (including, without limitation, any capital
or operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any Authorization, any related
constraints on operating activities and any potential liabilities to third
parties) which would, singly or in the aggregate, have a Material Adverse
Effect.
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(x) Each of the Company and the Company's subsidiaries has
such permits, licenses, consents, exemptions, franchises, authorizations and
other approvals (each, an "AUTHORIZATION") of, and has made all filings with
and notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including without limitation,
under any applicable Environmental Laws, as are necessary to own, lease,
license and operate its respective properties and to conduct its business,
except where the failure to have any such Authorization or to make any such
filing or notice would not, singly or in the aggregate, have a Material Adverse
Effect. Each such Authorization is valid and in full force and effect and each
of the Company and the Company's subsidiaries is in compliance with all the
terms and conditions thereof and with the rules and regulations of the
authorities and governing bodies having jurisdiction with respect thereto; and
no event has occurred (including, without limitation, the receipt of any notice
from any authority or governing body) which allows or, after notice or lapse of
time or both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would
result in any other impairment of the rights of the holder of any such
Authorization; except where such burden or failure to be valid and in full
force and effect or to be in compliance, the occurrence of any such event or
the presence of any such restriction would not, singly or in the aggregate,
have a Material Adverse Effect.
(y) The accountants, Xxxxxx Xxxxxxxx LLP and Ernst & Young
LLP, that have, as of the Closing, certified the financial statements and
supporting schedules of the Company or, one or more of the Company's
subsidiaries, are independent public accountants with respect to the Company
and its subsidiaries, as required by the Act and the Exchange Act. The summary
and selected historical consolidated financial data of the Company and the
historical financial statements, together with related schedules and notes, in
the Offering Memorandum or incorporated by reference complied as to form in all
material respects with the requirements applicable to (i) registration
statements under the Act or (ii) with respect to financial information
incorporated therein by reference, reports required to be filed under the
Exchange Act.
(z) The historical financial statements, together with
related schedules and notes incorporated by reference in the Offering
Memorandum (and any amendment or supplement thereto), present fairly the
consolidated financial position, results of operations and changes in financial
position of the Company and its subsidiaries on the basis stated in the
Offering Memorandum at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and data set forth
in the Offering Memorandum (and any amendment or supplement thereto) are, in
all material respects, accurately presented and prepared on a basis consistent
with such financial statements and the books and records of the Company.
(aa) The pro forma financial statements incorporated by
reference in the Offering Memorandum have been prepared on a basis consistent
with the historical financial statements of the Company and its subsidiaries,
as adjusted to reflect the previously discontinued oil and gas exploration and
production operations as continuing operations for accounting purposes only,
and give effect to assumptions used in the preparation thereof on a reasonable
basis and in good faith and such pro forma financial statements comply as to
form in all material respects with the requirements applicable to pro forma
financial statements included in a registration statement under the Act. The
other pro forma financial and statistical information and data included in the
Offering Memorandum are, in all material respects, accurately presented and
prepared on a basis consistent with the pro forma financial statements.
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(bb) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the net proceeds
thereof as described in the Offering Memorandum, will not be, an "investment
company," as such term is defined in the Investment Company Act of 1940, as
amended.
(cc) Except as disclosed in the Offering Memorandum and
required under the terms of the 1998 Senior Notes, the 1999 Secured Notes and
the 1999 Senior Notes, there are no contracts, agreements or understandings
between the Company and any person granting such person the right to require
the Company to file a registration statement under the Act with respect to any
securities of the Company (other than demand registration rights for not more
than an aggregate amount of 1,000,000 shares of the Company's common stock
granted in connection with acquisitions by the Company of stock or assets) or
to require the Company to include such securities with the Securities
registered pursuant to any Registration Statement.
(dd) Neither the Company or its subsidiaries nor any agent
thereof acting on the behalf of them has taken, and none of them will take, any
action that might cause this Agreement or the issuance or sale of the
Securities to violate Regulation T (12 C.F.R. Part 220), Regulation U (12
C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of the Board of Governors
of the Federal Reserve System.
(ee) No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2) under the
Act (i) has imposed (or has informed the Company that it is considering
imposing) any condition (financial or otherwise) on the Company's retaining any
rating assigned to the Company or any securities of the Company or (ii) has
indicated to the Company that it is considering (a) the downgrading,
suspension, or withdrawal of, or any review for a possible change that does not
indicate the direction of the possible change in, any rating so assigned or (b)
any change in the outlook for any rating of the Company or any securities of
the Company, except in the case of (i) and (ii) as publicly announced by such
nationally recognized statistical rating organization.
(ff) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to
the date of this Agreement), (i) there has not occurred any material adverse
change or, to the Company's or its subsidiaries' knowledge, any development
involving a prospective material adverse change in the condition, financial or
otherwise, or the earnings, business, management or operations of the Company
and its subsidiaries, taken as a whole, (ii) there has not been any adverse
change or, to the Company's or its subsidiaries' knowledge, any development
involving a prospective adverse change in the capital stock or in the long-term
debt of the Company or its subsidiaries and (iii) neither the Company nor its
subsidiaries has incurred any material liability or obligation, direct or
contingent.
(gg) The Offering Memorandum, as of its date, contains or
incorporates by reference all the information specified in, and meeting the
requirements of, Rule 144A(d)(4) under the Act.
(hh) When the Securities are issued and delivered pursuant to
this Agreement, the Securities will not be of the same class (within the
meaning of Rule 144A under the Act) as any security of the Company that is
listed on a national securities exchange registered under Section 6 of the
Exchange Act or that is quoted in a United States automated inter-dealer
quotation system.
(ii) No form of general solicitation or general advertising
(as defined in Regulation D under the Act) was used by the Company or any of
its respective representatives (other than the Initial Purchaser, as to whom
the Company makes no representation) in connection with the offer and
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sale of the Securities contemplated hereby, including, but not limited to,
articles, notices or other communications published in any newspaper, magazine,
or similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or
general advertising. No securities of the same class as any of the Securities
have been issued and sold by the Company within the six-month period
immediately prior to the date hereof.
(jj) Prior to the effectiveness of any Registration
Statement, the Indenture is not required to be qualified under the TIA.
(kk) None of the Company nor any of its affiliates or any
person acting on its or their behalf (other than the Initial Purchaser, as to
whom the Company makes no representation) has engaged or will engage in any
directed selling efforts within the meaning of Regulation S under the Act
("REGULATION S") with respect to the Securities.
(ll) No registration under the Act of the Securities is
required for the sale of the Securities to the Initial Purchaser as
contemplated hereby or for the Exempt Resales assuming the accuracy of the
Initial Purchaser's representations and warranties and agreements set forth in
Section 7 hereof.
(mm) Each certificate signed by any officer of the Company or
its subsidiaries and delivered to the Initial Purchaser or counsel for the
Initial Purchaser shall be deemed to be a representation and warranty by the
Company to the Initial Purchaser as to the matters covered thereby.
(nn) The Company and its subsidiaries have good and
marketable title to all real property and to all personal property owned by
them which is material to the business of the Company in each case free and
clear of all liens, except such as are described in the Offering Memorandum or
such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries. Except as otherwise described in the Offering
Memorandum or incorporated therein by reference, the Company and its
subsidiaries do not own any real property or buildings with such exceptions,
and any real property and buildings held under lease by the Company or its
subsidiaries are held by them under valid, subsisting and enforceable leases
that do not have such exceptions, unless in any case such exceptions are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company or its subsidiaries.
The Company acknowledges that the Initial Purchaser and, for
purposes of the opinions to be delivered to the Initial Purchaser pursuant to
Section 9 hereof, counsel to the Company and counsel to the Initial Purchaser
will rely upon the accuracy and truth of the foregoing representations and
hereby consents to such reliance.
7. INITIAL PURCHASER'S REPRESENTATIONS AND WARRANTIES. The
Initial Purchaser represents and warrants to, and agrees with, the Company:
(a) Such Initial Purchaser is a QIB with such knowledge and
experience in financial and business matters as is necessary in order to
evaluate the merits and risks of an investment in the Securities.
(b) Such Initial Purchaser (A) is not acquiring the
Securities with a view to any distribution thereof or with any present
intention of offering or selling any of the Securities in a transaction that
would violate the Act or the securities laws of any state of the United States
or any other
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applicable jurisdiction and (B) will be reoffering and reselling the Securities
only to QIBs in reliance on the exemption from the registration requirements of
the Act provided by Rule 144A.
(c) Such Initial Purchaser agrees that no form of general
solicitation or general advertising (within the meaning of Regulation D under
the Act) has been or will be used by the Initial Purchaser or any of its
representatives in connection with the offer and sale of the Securities
pursuant hereto, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
(d) Such Initial Purchaser agrees that, in connection with
Exempt Resales, the Initial Purchaser will solicit offers to buy the Securities
only from, and will offer to sell the Securities only to, Eligible Purchasers.
The Initial Purchaser further agrees that it will offer to sell the Securities
only to, and will solicit offers to buy the Securities only from Eligible
Purchasers that the Initial Purchaser reasonably believes are QIBs and that
agree that (x) the Securities purchased by them may be resold, pledged or
otherwise transferred within the time period referred to under Rule 144(k)
(taking into account the provisions of Rule 144(d) under the Act, if
applicable) under the Act, as in effect on the date of the transfer of such
Securities, only (I) to the Company or any of its subsidiaries, (II) to a
person whom the seller reasonably believes is a QIB purchasing for its own
account or for the account of a QIB in a transaction meeting the requirements
of Rule 144A under the Act, (III) in a transaction meeting the requirements of
Rule 144 under the Act, (IV) to an Accredited Institution that, prior to such
transfer, furnishes the trustee a signed letter containing certain
representations and agreements relating to the registration of transfer of such
Securities and an opinion of counsel acceptable to the Company that such
transfer is in compliance with the Act, (V) in accordance with another
exemption from the registration requirements of the Act (and based upon an
opinion of counsel acceptable to the Company) or (VI) pursuant to an effective
registration statement and, in each case, in accordance with the applicable
securities laws of any state of the United States or any other applicable
jurisdiction and (y) they will deliver to each person to whom such Securities
or an interest therein is transferred a notice substantially to the effect of
the foregoing.
(e) Such Initial Purchaser and its affiliates or any person
acting on its or their behalf have not engaged or will not engage in any
directed selling efforts within the meaning of Regulation S with respect to the
Securities.
The Initial Purchaser acknowledges that the Company and, for
purposes of the opinions to be delivered to the Initial Purchaser pursuant to
Section 9 hereof, counsel to the Company and counsel to the Initial Purchaser
will rely upon the accuracy and truth of the foregoing representations and the
Initial Purchaser hereby consents to such reliance.
8. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless the
Initial Purchaser, its directors, its officers and each person, if any, who
controls the Initial Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses reasonably incurred in connection with investigating or
defending any matter, including any action, that could give rise to any such
losses, claims, damages, liabilities or judgments) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Offering Memorandum (or any amendment or supplement thereto), any Rule 144A
Information provided by the Company to any holder or prospective
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purchaser of Securities pursuant to Section 5(h) or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages, liabilities or judgments are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
information relating to the Initial Purchaser furnished in writing to the
Company by the Initial Purchaser.
(b) The Initial Purchaser agrees to indemnify and hold
harmless the Company and its respective directors and officers and each person,
if any, who controls (within the meaning of Section 15 of the Act or Section 20
of the Exchange Act) the Company, to the same extent as the foregoing indemnity
from the Company to the Initial Purchaser, but only with reference to
information relating to the Initial Purchaser furnished in writing to the
Company by the Initial Purchaser expressly for use in the Offering Memorandum.
(c) In case any action shall be commenced involving any
person in respect of which indemnity may be sought pursuant to Section 8(a) or
8(b) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the indemnified
party and the payment of all fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Sections 8(a) and 8(b), the Initial Purchaser shall not
be required to assume the defense of such action pursuant to this Section 8(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of the Initial Purchaser). Any indemnified party shall have the right
to employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified
parties and all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by the Initial Purchaser, in
the case of the parties indemnified pursuant to Section 8(a), and by the
Company, in the case of parties indemnified pursuant to Section 8(b). The
indemnifying party shall indemnify and hold harmless the indemnified party from
and against any and all losses, claims, damages, liabilities and judgments by
reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into
more than twenty business days after the indemnifying party shall have received
a request from the indemnified party for reimbursement for the fees and
expenses of counsel (in any case where such fees and expenses are at the
expense of the indemnifying party) and, prior to the date of such settlement,
the indemnifying party shall have failed to comply with such reimbursement
request. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement or compromise of, or consent to the
entry of judgment with respect to, any pending or threatened action in respect
of which the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party
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from all liability on claims that are or could have been the subject matter of
such action and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act, by or on behalf of the indemnified
party.
(d) To the extent the indemnification provided for in this
Section 8 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages, liabilities or judgments referred to therein, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Initial Purchaser on the other hand from the
offering of the Securities or (ii) if the allocation provided by clause 8(d)(i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause 8(d)(i) above
but also the relative fault of the Company, on the one hand, and the Initial
Purchaser, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or judgments, as
well as any other relevant equitable considerations. The relative benefits
received by the Company, on the one hand and the Initial Purchaser, on the
other hand, shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Securities (after underwriting discounts and
commissions, but before deducting expenses) received by the Company, and the
total discounts and commissions received by the Initial Purchaser bear to the
total price to investors of the Securities, in each case as set forth in the
table on the cover page of the Offering Memorandum. The relative fault of the
Company, on the one hand, and the Initial Purchaser, on the other hand, shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company, on the
one hand, or the Initial Purchaser, on the other hand, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company, on the one hand, and the Initial Purchaser, on
the other hand, agree that it would not be just and equitable if contribution
pursuant to this Section 8(d) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities or judgments referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any matter, including any
action, that could have given rise to such losses, claims, damages, liabilities
or judgments. Notwithstanding the provisions of this Section 8, the Initial
Purchaser shall not be required to contribute any amount in excess of the
amount by which the total discounts and commissions received by the Initial
Purchaser exceeds the amount of any damages which the Initial Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
9. CONDITIONS OF INITIAL PURCHASER'S OBLIGATIONS. The
obligations of the Initial Purchaser to purchase the Securities under this
Agreement are subject to the satisfaction of each of the following conditions:
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(a) All the representations and warranties of the Company and
its subsidiaries contained in this Agreement shall be true and correct on the
Closing Date with the same force and effect as if made on and as of the Closing
Date.
(b) Since the respective dates as of which information is
given in the Offering Memorandum other than as set forth in the Offering
Memorandum (exclusive of any amendments or supplements thereto subsequent to
the date of this Agreement), (i) there shall not have occurred any adverse
change or any development involving a prospective change in the condition,
financial or otherwise, or the earnings, business, management or operations of
the Company and its subsidiaries, taken as a whole, (ii) there shall not have
been any material adverse change or any development involving a prospective
material adverse change in the capital stock or in the long-term debt of the
Company and (iii) the Company shall not have incurred any liability or
obligation, direct or contingent, the effect of which, in any such case
described in clause 9(c)(i), 9(c)(ii) or 9(c)(iii), in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market
the Securities on the terms and in the manner contemplated in the Offering
Memorandum.
(c) The Initial Purchaser shall have received on the Closing
Date a certificate dated the Closing Date, signed by the Chief Executive
Officer and the Principal Financial Officer of the Company, confirming the
matters set forth in Sections 6(ff), 9(a) and 9(b) and stating that the Company
has complied with all the agreements and satisfied all of the conditions herein
contained and required to be complied with or satisfied on or prior to the
Closing Date.
(d) The Initial Purchaser shall have received on the Closing
Date an opinion (satisfactory to you and counsel for the Initial Purchaser),
dated the Closing Date, of Gardere Xxxxx Xxxxxx & Xxxxx, L.L.P., counsel for
the Company, to the effect that:
(i) the Company has been duly incorporated or
formed, is validly existing as a corporation in good standing
under the laws of Delaware and has the corporate power and
authority to carry on its business as described in the
Offering Memorandum and to own, lease and operate its
properties;
(ii) the Units to be issued and sold by the Company
hereunder have been duly authorized, and when issued and
delivered to the Initial Purchaser against payment therefor
as provided in this Agreement, will have been validly issued
and will be fully paid and non-assessable, and the issuance
of such Restricted Preferred Stock is free of any preemptive
or similar rights;
(iii) the Preferred Stock to be issued and sold by
the Company hereunder has been duly authorized, and when
issued and delivered to the Initial Purchaser against payment
therefor as provided in this Agreement, will have been
validly issued and will be fully paid and non-assessable, and
the issuance of such Preferred Stock is free of any
preemptive or similar rights;
(iv) the Dividend Shares, to be issued as dividends
on the Preferred Stock, have been duly authorized, and when
issued and delivered to the holders of the Preferred Stock as
provided in the Certificate of Designation after the due and
proper declaration of such dividends by the Board of
Directors, will have been validly issued and will be fully
paid and non-assessable, and the issuance of such Dividend
Shares would be free of any preemptive or similar rights;
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(v) the Warrants to be issued and sold by the
Company hereunder have been duly authorized, and when issued
and delivered to the Initial Purchaser against payment
therefor as provided in this Agreement, will have been
validly issued and will be fully paid and non-assessable, and
the issuance of such Warrants is free of any preemptive or
similar rights;
(vi) the Warrant Shares to be issued upon exercise
of the Warrants have been duly authorized, and when issued
and delivered to holders against payment therefor as provided
in the Warrant Agreement, will have been validly issued and
will be fully paid and non-assessable, and the issuance of
such Warrant Shares will be free of any preemptive or similar
rights;
(vii) the Certificate of Designation has been duly
authorized, executed and filed with the Secretary of State of
the State of Delaware and the Amended and Restated
Certificate of Incorporation of the Company, including the
Certificate of Designation forming part thereof, sets forth
the rights, preferences and priorities of the Preferred Stock
and the Dividend Shares;
(viii) the Warrant Agreement has been duly
authorized, executed and delivered by the Company and is a
valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except as to
(x) the Enforceability Exceptions and (y) the availability of
equitable remedies may be limited by equitable principles of
general applicability;
(ix) the Unit Agreement has been duly authorized,
executed and delivered by the Company and is a valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms except as to (x) the
Enforceability Exceptions and (y) the availability of
equitable remedies may be limited by equitable principles of
general applicability;
(x) the form of Indenture has been duly authorized,
and when the Indenture has been executed and delivered by the
Company after due and proper authorization by the Board of
Directors of the exchange of the Preferred Stock for the
Exchange Debentures in accordance with the terms of the
Certificate of Designation, will be a valid and binding
agreement of the Company, enforceable against the Company in
accordance with its terms except as to (x) the Enforceability
Exceptions and (y) rights of acceleration and the
availability of equitable remedies may be limited by
equitable principles of general applicability;
(xi) the form of Exchange Debenture has been duly
authorized and, when the Exchange Debentures have been
executed and authenticated in accordance with the provisions
of the Certificate of Designation and the Indenture after due
and proper authorization by the Board of Directors of the
exchange of the Preferred Stock for the Exchange Debentures
and delivered to holders of the Preferred Stock in accordance
with the terms of the Certificate of Designation and the
Indenture, will be entitled to the benefits of the Indenture
and will be valid and binding obligations of the Company,
enforceable in accordance with their terms except as to (x)
the Enforceability Exceptions and
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(y) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability;
(xii) this Agreement has been duly authorized,
executed and delivered by the Company;
(xiii) each of the Preferred Stock Registration
Rights Agreement and the Warrant Registration Rights
Agreement has been duly authorized, executed and delivered by
the Company and is a valid and binding agreements of the
Company, enforceable against the Company in accordance with
their terms, except as to (x) the Enforceability Exceptions,
(y) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability and (z) the enforceability of the
indemnification provisions thereof may be limited by federal
and state securities laws;
(xiv) the New Preferred Stock and related Dividend
Shares have been duly authorized;
(xv) the statements under the captions "Risk
Factors," "Description of Securities," "Description of
Certain Indebtedness," "Description of Capital Stock,"
"Certain Federal Income Tax Consequences to the U.S.
Holders," "Plan of Distribution" and "Notice to Investors" in
the Offering Memorandum, insofar as such statements
constitute a summary of legal matters, fairly present in all
material respects such legal matters;
(xvi) the execution, delivery and performance of
this Agreement, the Warrant Agreement, the Unit Agreement,
the Preferred Stock Registration Rights Agreement and the
Warrant Registration Rights Agreement, and, upon due and
proper authorization by the Board of Directors of the
exchange of the Preferred Stock for the Exchange Debentures
in accordance with the terms of the Certificate of
Designation, the Indenture and the Exchange Debentures and
compliance with the terms and provisions thereof by the
Company, and the issuance and sale of the Securities and
compliance with the Certificate of Designation will not (i)
violate its charter or bylaws, (ii) require any consent,
approval, authorization or other order of, or qualification
with, any court or governmental body or agency of the United
States or the States of Texas or New York (except such as may
be required under the securities or Blue Sky laws of the
various states), (iii) conflict with or constitute a breach
of any of the terms or provisions of, or a default under the
indentures executed, or senior notes issued, by the Company
in connection with the 1998 Senior Note and the 1999 Senior
Note offerings and by the Company and RBF Finance Co. in
connection with the 1999 Secured Note offering or, to such
counsel's actual knowledge, any other indenture, loan
agreement, mortgage, lease or other agreement or instrument
to which the Company or the Significant Subsidiaries is a
party or by which the Company or the Significant Subsidiaries
or their respective property is bound, which conflict, breach
or default is likely to have, either individually or in the
aggregate, a Material Adverse Effect, or (iv) violate or
conflict with any applicable law or any rule or regulation,
or to such counsel's actual knowledge, any judgment, order or
decree, in each case of any court or any governmental
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body or agency of the United States or the States of Texas or
New York having jurisdiction over the Company or the
Significant Subsidiaries or their respective property;
(xvii) the Company is not and, after giving effect
to the offering and sale of the Securities and the
application of the net proceeds thereof as described in the
Offering Memorandum, will not be, an "investment company" as
such term is defined in the Investment Issuer Act of 1940, as
amended;
(xviii) the Indenture complies as to form in all
material respects with the requirements of the TIA, and the
rules and regulations of the Commission applicable to an
indenture which is qualified thereunder; it is not necessary
in connection with the offer, sale and delivery of the
Securities to the Initial Purchaser in the manner
contemplated by this Agreement or in connection with the
Exempt Resales to qualify the Indenture under the TIA;
(xix) no registration under the Act of the
Securities is required for the sale of the Securities to the
Initial Purchaser as contemplated by this Agreement or for
the Exempt Resales assuming that (i) the Initial Purchaser is
a QIB, (ii) the accuracy of, and compliance with, the Initial
Purchaser's representations and agreements contained in
Section 7 of this Agreement and (iii) the accuracy of the
representations of the Company set forth in Sections 5(h) and
6(bb), (dd) and (hh) of this Agreement; and
(xx) such counsel has participated in conferences
with officers and other representatives of the Company,
representatives of the Company's accountants, the Initial
Purchaser's representatives and counsel for the Initial
Purchaser, at which conferences the contents of the Offering
Memorandum and related matters were discussed and, although
such counsel is not passing upon and does not assume any
responsibility for and shall not be deemed to have
independently verified the accuracy, completeness or fairness
of the statements contained in the Offering Memorandum no
facts have come to the attention of such counsel that lead
such counsel to believe that the Offering Memorandum
contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements contained therein not
misleading or that the Offering Memorandum on the date
thereof or on the date hereof (other than the financial
statements and notes thereto and the other financial
information, including the information referred to under the
caption "Experts" as to which such counsel does not comment)
contained any untrue statement of a material fact or omitted
to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
The opinion of Gardere Xxxxx Xxxxxx & Xxxxx, L.L.P. described in
Section 9(d) above shall be rendered to you at the request of the Company and
shall so state therein. In giving such opinion with respect to the matters
covered by Section 9(d)(xx), Gardere Xxxxx Xxxxxx & Xxxxx, L.L.P. may state
that their opinion and belief are based upon their participation in the
preparation of the Offering Memorandum and any amendments or supplements
thereto and review and discussion of the contents thereof, but are without
independent check or verification except as specified.
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(e) The Initial Purchaser shall have received on the Closing
Date an opinion (satisfactory to you and counsel for the Initial Purchaser),
dated the Closing Date, of Xxxxxxxx X. Xxxx, Senior Vice President and
Co-Counsel for the Company, to the effect that:
(i) the Company has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of Delaware and has the corporate power and authority to
carry on its business as described in the Offering Memorandum
and to own, lease and operate its properties;
(ii) the Company is duly qualified and is in good
standing as a foreign corporation authorized to do business
in each jurisdiction in which the nature of its business or
its ownership or leasing of property requires such
qualification, or application has been made and is pending,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(iii) R&B Falcon Holdings, Inc. ("HOLDINGS") has
been duly incorporated, is validly existing as a corporation
and in good standing under the laws of its jurisdiction of
incorporation, has the corporate authority to carry on its
business and to own, lease and operate its properties; is
duly qualified and is in good standing as a foreign
corporation or entity authorized to do business in each state
of the United States in which the nature of its business or
its ownership or leasing of property requires such
qualification, or application has been made and is pending,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(iv) R&B Falcon Drilling (International & Deepwater)
("DEEPWATER") Inc. has been duly incorporated, is validly
existing as a corporation and in good standing under the laws
of its jurisdiction of incorporation, has the corporate and
authority to carry on its business and to own, lease and
operate its properties; is duly qualified and is in good
standing as a foreign corporation or entity authorized to do
business in each state of the United States in which the
nature of its business or its ownership or leasing of
property requires such qualification, or application has been
made and is pending, except where the failure to be so
qualified would not have a Material Adverse Effect;
(v) Cliffs Drilling Company ("CLIFFS") has been duly
incorporated, is validly existing as a corporation and in
good standing under the laws of its jurisdiction of
incorporation, has the corporate and authority to carry on
its business and to own, lease and operate its properties; is
duly qualified and is in good standing as a foreign
corporation or entity authorized to do business in each state
of the United States in which the nature of its business or
its ownership or leasing of property requires such
qualification, or application has been made and is pending,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(vi) R&B Falcon Drilling USA, Inc. ("DRILLING USA")
has been duly incorporated, is validly existing as a
corporation and in good standing under the
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laws of its jurisdiction of incorporation, has the corporate
and authority to carry on its business and to own, lease and
operate its properties; is duly qualified and is in good
standing as a foreign corporation or entity authorized to do
business in each state of the United States in which the
nature of its business or its ownership or leasing of
property requires such qualification, or application has been
made and is pending, except where the failure to be so
qualified would not have a Material Adverse Effect;
(vii) R&B Falcon Drilling Co. ("DRILLING CO.") has
been duly incorporated, is validly existing as a corporation
and in good standing under the laws of its jurisdiction of
incorporation, has the corporate and authority to carry on
its business and to own, lease and operate its properties; is
duly qualified and is in good standing as a foreign
corporation or entity authorized to do business in each state
of the United States in which the nature of its business or
its ownership or leasing of property requires such
qualification, or application has been made and is pending,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(viii) R&B Falcon Exploration Co. ("EXPLORATION")
has been duly incorporated, is validly existing as a
corporation and in good standing under the laws of its
jurisdiction of incorporation, has the corporate and
authority to carry on its business and to own, lease and
operate its properties; is duly qualified and is in good
standing as a foreign corporation or entity authorized to do
business in each state of the United States in which the
nature of its business or its ownership or leasing of
property requires such qualification, or application has been
made and is pending, except where the failure to be so
qualified would not have a Material Adverse Effect;
(ix) Double Eagle Marine, Inc. ("DEM") has been duly
incorporated, is validly existing as a corporation and in
good standing under the laws of its jurisdiction of
incorporation, has the corporate and authority to carry on
its business and to own, lease and operate its properties; is
duly qualified and is in good standing as a foreign
corporation or entity authorized to do business in each state
of the United States in which the nature of its business or
its ownership or leasing of property requires such
qualification, or application has been made and is pending,
except where the failure to be so qualified would not have a
Material Adverse Effect;
(x) all the outstanding shares of capital stock of
the Company, Deepwater, Holdings, Cliffs, Drilling USA,
Drilling Co., Exploration and DEM have been duly authorized
and validly issued and are fully paid, non-assessable and, to
such counsel's knowledge, are not subject to any preemptive
or similar rights;
(xi) to such counsel's actual knowledge, there are
no authorized or outstanding subscriptions, options,
warrants, preemptive rights, rights of first refusal or other
rights to purchase, or equity or debt securities convertible
or exchangeable into or exchangeable or exercisable for, any
capital stock of the Company or any of its subsidiaries other
than those described in the Offering Memorandum and this
Agreement.
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(x) the Company has the corporate power and
authority to perform its obligations under the Operative
Documents;
(xi) this Agreement has been duly authorized,
executed and delivered by the Company;
(xii) each of the Preferred Stock Registration
Rights Agreement and the Warrant Registration Rights
Agreement has been duly authorized, executed and delivered by
the Company;
(xiii) to such counsel's knowledge, (a) none of the
Company or Holdings, Deepwater, Cliffs, Drilling USA,
Drilling Co., Exploration or DEM (the "SIGNIFICANT
SUBSIDIARIES") is in violation of its respective charter or
bylaws and, (b) neither the Company nor the Significant
Subsidiaries is in default in the performance of any
obligation, agreement, covenant or condition contained in any
indenture, loan agreement, mortgage, lease or other agreement
or instrument that is material to the Company and the
Significant Subsidiaries, taken as a whole, to which the
Company or the Significant Subsidiaries is a party or by
which the Company or the Significant Subsidiaries or their
respective property is bound, which default could reasonably
be expected to result in a Material Adverse Effect;
(xiv) the execution, delivery and performance of
this Agreement, the Warrant Agreement, the Unit Agreement,
the Preferred Stock Registration Rights Agreement and the
Warrant Registration Rights Agreement, and, upon due and
proper authorization by the Board of Directors of the
exchange of the Preferred Stock for the Exchange Debentures
in accordance with the terms of the Certificate of
Designation, the Indenture and the Exchange Debentures and
compliance with the terms and provisions thereof by the
Company and the issuance and sale of the Securities and
compliance with the Certificate of Designation will not (i)
violate its charter or bylaws, (ii) require any consent,
approval, authorization or other order of, or qualification
with, any court or governmental body or agency of the United
States or the States of Texas or New York (except such as may
be required under the securities or Blue Sky laws of the
various states), (iii) conflict with or constitute a breach
of any of the terms or provisions of, or a default under the
indenture executed, or senior notes issued, by the Company in
connection with debt offerings by the Company in connection
with the 1998 Senior Note and the 1999 Senior Note offerings
and by the Company and RBF Finance Co. in connection with the
1999 Secured Note offering or, to such counsel's actual
knowledge, any indenture, loan agreement, mortgage, lease or
other agreement or instrument to which the Company or the
Significant Subsidiaries is a party or by which the Company
or the Significant Subsidiaries or their respective property
is bound, which conflict, breach or default is likely to
have, either individually or in the aggregate, a Material
Adverse Effect, or (iv) violate or conflict with any
applicable law or any rule or regulation, or to such
counsel's actual knowledge, any judgment, order or decree, in
each case of any court or any governmental body or agency
having
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jurisdiction over the Company or the Significant Subsidiaries
or their respective property.
(xv) such counsel has no knowledge of any legal or
governmental proceedings pending or threatened to which the
Company or the Significant Subsidiaries is or could be a
party or to which any of their respective property is or
could be subject, which could reasonably be expected to
result, singly or in the aggregate, in a Material Adverse
Effect.
(xvi) to such counsel's knowledge, each of the
Company and the Significant Subsidiaries has such
Authorizations of, and has made all filings with and notices
to, all governmental or regulatory authorities and
self-regulatory organizations and all courts and other
tribunals, including without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license
and operate its respective properties and to conduct its
business, except where the failure to have any such
Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a Material Adverse Effect.
To such counsel's knowledge, (a) each such Authorization is
valid and in full force and effect and each the Company and
the Significant Subsidiaries is in compliance with all the
terms and conditions thereof and with the rules and
regulations of the authorities and governing bodies having
jurisdiction with respect thereto; and (b) no event has
occurred (including the receipt of any notice from any
authority or governing body) which allows or, after notice or
lapse of time or both, would allow, revocation, suspension or
termination of any such Authorization or results or, after
notice or lapse of time or both, would result in any other
impairment of the rights of the holder of any such
Authorization; and (c) such Authorizations contain no
restrictions that are burdensome to the Company or the
Significant Subsidiaries; except where such failure to be
valid and in full force and effect or to be in compliance,
the occurrence of any such event or the presence of any such
restriction would not, singly or in the aggregate, have a
Material Adverse Effect;
(xvii) to such counsel's knowledge, neither the
Company nor its subsidiaries has violated any Environmental
Law or any provisions of ERISA, any provisions of the Foreign
Corrupt Practices Act of the rules and regulations
promulgated thereunder, except for such violations which,
singly or in the aggregate, would not have a Material Adverse
Effect;
(xviii) after such counsel's review of the sections
of the Offering Memorandum under the headings "Offering
Memorandum Summary," "Risk Factors," "Use of Proceeds,"
"Management's Discussion and Analysis of Financial Condition
and Results of Operations," "Description of
Securities--Description of Preferred Stock," "Description of
Certain Indebtedness" and Part I of the Company's Form 10-K
for the year ended December 31, 1998 (the "DESIGNATED
SECTIONS"), to such counsel's knowledge, except as disclosed
in the Designated Sections, there are no contracts,
agreements or understandings (other than the Registration
Rights Agreement) between the Company and any person granting
such person the right to require such Company to include such
securities with the Securities registered pursuant to any
Registration Statement; and
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(xix) such counsel has participated in conferences
with officers and other representatives of the Company,
representatives of the Company's accountants, the Initial
Purchaser's representatives and counsel for the Initial
Purchaser, at which conferences the contents of the Offering
Memorandum and related matters were discussed and, although
such counsel is not passing upon and do not assume any
responsibility for and shall not be deemed to have
independently verified the accuracy, completeness or fairness
of the statements contained in the Offering Memorandum, no
facts have come to the attention of such counsel that lead
such counsel to believe (a) that the Designated Sections
contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements contained therein not
misleading or (b) that the Offering Memorandum on the date
thereof or on the date hereof contained any untrue statement
of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(f) The Initial Purchaser shall have received on the Closing
Date an opinion, dated the Closing Date, of Akin, Gump, Strauss, Xxxxx & Xxxx,
L.L.P., counsel for the Initial Purchaser, in form and substance reasonably
satisfactory to the Initial Purchaser.
(g) The Initial Purchaser shall have received, at the Closing
Date, a letter dated the Closing Date, as the case may be, in the form attached
hereto as Annex I, from Ernst & Young LLP, independent public accountants.
(h) The Initial Purchaser shall have received, at the Closing
Date, a letter dated the Closing Date, in the form attached hereto as Annex II,
from Xxxxxx Xxxxxxxx LLP, independent public accountants.
(i) The Securities shall have been approved by Nasdaq for
trading and duly listed on PORTAL.
(j) The Initial Purchaser shall have received a certified
copy of the Indenture which shall have been delivered by the Company to the
Transfer Agent.
(k) The Company shall have executed the Preferred Stock
Registration Rights Agreement and the Initial Purchaser shall have received an
original copy thereof, duly executed by the Company.
(l) The Company shall have executed the Warrant Registration
Rights Agreement and the Initial Purchaser shall have received an original copy
thereof, duly executed by the Company and the Unit Agent.
(m) The Company shall have executed the Unit Agreement and
the Initial Purchaser shall have received an original copy thereof, duly
executed by the Company and the Warrant Agent.
(n) The Company shall have executed the Warrant Agreement and
the Initial
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Purchaser shall have received an original copy thereof, duly executed by the
Company.
(o) The Company shall have executed and filed the Certificate
of Designation with the Secretary of State of the State of Delaware and the
Initial Purchaser shall have received a certified copy thereof.
(p) The Company shall not have failed at or prior to the
Closing Date to perform or comply with any of the agreements herein contained
and required to be performed or complied with by the Company at or prior to the
Closing Date.
10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This
Agreement shall become effective upon the execution and delivery of this
Agreement by the parties hereto.
This Agreement may be terminated at any time on or prior to the
Closing Date by the Initial Purchaser by written notice to the Company if any
of the following has occurred: (i) any outbreak or escalation of hostilities or
other national or international calamity or crisis or change in economic
conditions or in the financial markets of the United States or elsewhere that,
in the Initial Purchaser's judgment, is material and adverse and, in the
Initial Purchaser's judgment, makes it impracticable to market the Securities
on the terms and in the manner contemplated in the Offering Memorandum, (ii)
the suspension or material limitation of trading in securities or other
instruments on the New York Stock Exchange, the American Stock Exchange, the
Chicago Board of Options Exchange, the Chicago Mercantile Exchange, the Chicago
Board of Trade or the Nasdaq National Market or limitation on prices for
securities or other instruments on any such exchange or the Nasdaq National
Market, (iii) the suspension of trading of any securities of the Company on any
exchange or in the over-the-counter market, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of any court or other governmental authority which in your opinion
materially and adversely affects, or will materially and adversely affect, the
business, prospects, financial condition or results of operations of the
Company, (v) the declaration of a banking moratorium by either federal or New
York State authorities or (vi) the taking of any action by any federal, state
or local government or agency in respect of its monetary or fiscal affairs
which in your opinion has a material adverse effect on the financial markets in
the United States.
11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to R&B Falcon
Corporation, 000 Xxxxxxxxxxxx, Xxxxxxx, XX 00000 (telephone number:
000-000-0000) and (ii) if to the Initial Purchaser, Xxxxxxxxx, Lufkin &
Xxxxxxxx Securities Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Syndicate Department, or in any case to such other address as the
person to be notified may have requested in writing.
The respective indemnities, contribution agreements,
representations, warranties and other statements of the Company and its
subsidiaries and the Initial Purchaser set forth in or made pursuant to this
Agreement shall remain operative and in full force and effect, and will survive
delivery of and payment for the Securities, regardless of (i) any
investigation, or statement as to the results thereof, made by or on behalf of
the Initial Purchaser, the officers or directors of the Initial Purchaser, any
person controlling the Initial Purchaser, the Company, the officers or
directors of the Company, or any person controlling the Company, (ii)
acceptance of the Securities and payment for them hereunder and (iii)
termination of this Agreement.
If for any reason the Securities are not delivered by or on behalf
of the Company as provided herein (other than as a result of any termination of
this Agreement pursuant to Section 10), the Company agrees to reimburse the
Initial Purchaser for all out-of-pocket expenses (including the fees and
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disbursements of counsel) incurred by them. Notwithstanding any termination of
this Agreement, the Company shall be liable for all expenses which it has
agreed to pay pursuant to Section 5(i) hereof. The Company also agrees to
reimburse the Initial Purchaser and their officers, directors and each person,
if any, who controls the Initial Purchaser within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act for any and all fees and expenses
(including without limitation the fees and expenses of counsel) incurred by
them in connection with enforcing their rights under this Agreement (including
without limitation its rights under Section 8).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the Initial
Purchaser, the Initial Purchaser's directors and officers, any controlling
persons referred to herein, the directors and officers of the Company and its
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Securities from the Initial Purchaser merely because of
such purchase.
This Agreement shall be governed and construed in accordance with
the laws of the State of New York, without regard to the conflict of law rules
thereof.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the
agreement among the Company and the Initial Purchaser.
Very truly yours,
R&B FALCON CORPORATION
By: /s/ XXXXXX X. XXXXXX
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: EVP
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
By: /s/ XXXXXX XXXXXXX
-------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
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SCHEDULE B
SIGNIFICANT SUBSIDIARIES
R&B Falcon Holdings Inc.
R&B Falcon Drilling (International & Deepwater) Inc.
Cliffs Drilling Company
R&B Falcon Drilling USA, Inc.
R&B Falcon Drilling Co.
R&B Falcon Exploration Co.
Double Eagle Marine, Inc.
Arcade Drilling AS
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EXHIBIT A
FORM OF PREFERRED STOCK REGISTRATION RIGHTS AGREEMENT
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EXHIBIT B
FORM OF WARRANT REGISTRATION RIGHTS AGREEMENT
