EXHIBIT 10.12
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT is made as of the 30th day of August,
1999, by R&B Falcon Corporation, a Delaware corporation, in
accordance with a resolution of the Board of Directors of said
corporation, a copy of which is attached hereto, in favor of Bank
One, Louisiana, National Association. Pledgor hereby agrees with
Secured Party as follows:
1. Definitions. As used in this Agreement, the following
terms shall have the meanings indicated below:
(a) The term "Account" shall mean the following
described deposit account:
Bank One, Louisiana, N.A. Certificate of Deposit
Account # 1582816250 issued by Bank One, Louisiana,
N.A. dated August 27, 1999 in an original principal
amount of Fifty Million dollars ($50,000,000.00)
(b) The term "Agreement" shall mean this pledge
agreement, as it may be amended, supplemented or otherwise
modified and in effect from time to time.
(c) The term "Application" shall mean, collectively,
the Application and Agreement for Irrevocable Standby Letter
of Credit dated August 30, 1999 between Pledgor and Secured
Party under which Pledgor is the applicant and requests Bank
One, Louisiana, N.A. to issue a $50,000,000 letter of
credit, as such Application and Agreement for Irrevocable
Letter of Credit may be amended, supplemented or otherwise
modified and in effect from time to time.
(d) The term "Code" shall mean the Louisiana
Commercial Laws (La. R.A. 10:9-101, et. seq.) as adopted and
in effect in the State of Louisiana on the date of this
Agreement or as it may hereafter be amended from time to
time.
(e) The term "Collateral" shall mean the Account
together with (i) all interest, whether now accrued or
hereafter accruing, on the Account, (ii) all additional
deposits hereafter made to the Account, (iii) all
instruments, certificates, passbooks, documents, agreements
and other writings evidencing the Account, (iv) all records
relating to the Account, (v) all renewals, replacements and
substitutions for any of the foregoing, and (vi) all
proceeds of any or all of the foregoing. The designation of
proceeds does not authorize Pledgor to sell, transfer or
otherwise convey any of the foregoing property.
(f) The term "Indebtedness" shall mean (i) all
indebtedness, obligations and liabilities (including,
without limitation, fees payable to Secured Party
thereunder) of Pledgor to Secured Party of any kind or
character, now existing or hereafter arising, under the
Application or this Agreement, whether direct, indirect,
related, unrelated, fixed, contingent, liquidated,
unliquidated, joint, several or joint and several, (ii) all
accrued but unpaid interest on any of the indebtedness,
obligations or liabilities described in (i) above, (iii) all
obligations of Pledgor to Secured Party under any documents
evidencing, securing, governing and/or pertaining to all or
any part of the indebtedness described in (i) and (ii)
above, (iv) all costs and expenses incurred by Secured Party
in connection with the collection and administration of all
or any part of the indebtedness and obligations described in
(i), (ii) and (iii) above or the protection or preservation
of, or realization upon, the collateral securing all or any
part of such indebtedness and obligations, including without
limitation all reasonable attorneys' fees, and (v) all
renewals, extensions, modifications and rearrangements of
the indebtedness and obligations described in (i), (ii),
(iii) and (iv) above.
(g) The term "Obligated Party" shall mean any party
other than Pledgor who secures, guarantees and/or is
otherwise obligated to pay all or any portion of the
Indebtedness.
(h) The term "Pledgor" shall mean R & B Falcon
Corporation, a Delaware corporation, TIN 00-0000000, and its
successors and assigns.
(i) The term "Related Documents" shall mean this
Agreement, the Application and all instruments and documents
evidencing, securing, governing, guaranteeing and/or
pertaining to the Indebtedness.
(j) The term "Secured Party" shall mean Bank One,
Louisiana, N.A., TIN 00-0000000, its successors and assigns,
including without limitation, any party to whom Bank One
Louisiana, N.A., or any of its successors or assigns, may
assign its rights and interests under this Agreement.
All words and phrases used herein which are expressly defined in
the Code shall have the meaning provided for therein.
2. Security Interest. As security for the prompt and
punctual payment and satisfaction of the Indebtedness, Pledgor,
for value received, hereby grants to Secured Party a continuing
security interest in the Collateral. This Agreement shall remain
in full force and effect, and Secured party shall have the right
to continue to retain possession of the Collateral until such
time as this Agreement and the security interest created hereby
are terminated and cancelled by the Secured Party under a written
cancellation instrument in favor of the Pledgor.
3. Maintenance of Collateral. As long as this Agreement
remains in effect, Secured Party shall have the right (but in
accordance with the terms of this Section, no obligation) to
renew the Account from time to time for a similar term and at
then offered interest rate(s). Other than the exercise of
reasonable care to ensure the safe custody of any Collateral in
Secured Party's possession from time to time, Secured Party does
not have any obligation, duty or responsibility with respect to
the Collateral. Without limiting the generality of the
foregoing, Secured Party shall not have any obligation, duty or
responsibility to do any of the following: (a) ascertain any
maturities, calls, conversions, exchanges, offers, tenders or
similar matters relating to the Collateral or informing Pledgor
with respect to any such matters; (b) fix, preserve or exercise
any right, privilege or option (whether conversion, redemption or
otherwise) with respect to the Collateral unless (i) Pledgor
makes written demand to Secured Party to do so, (ii) such written
demand is received by Secured Party in sufficient time to permit
Secured Party to take the action demanded in the ordinary course
of its business, and (iii) Pledgor provides additional
collateral, acceptable to Secured Party in its sole discretion;
(c) collect any amounts payable in respect of the Collateral
(Secured Party being liable to account to Pledgor only for what
Secured Party may actually receive or collect thereon); (d) sell
all or any portion of the Collateral to avoid market loss; (e)
sell all or any portion of the Collateral unless and until (i)
Pledgor makes written demand upon Secured Party to sell the
Collateral, and (ii) Pledgor provides additional collateral,
acceptable to Secured Party in its sole discretion; or (f) hold
the Collateral for or on behalf of any party other than Pledgor.
4. Representations and Warranties. Pledgor hereby
represents and warrants the following to Secured Party:
(a) Due Authorization. The execution, delivery and
performance of this Agreement and all of the other Related
Documents by Pledgor have been duly authorized by all necessary
corporate action of Pledgor.
(b) Enforceability. This Agreement and the other Related
Documents constitute legal, valid and binding obligations of
Pledgor, enforceable in accordance with their respective terms,
except as limited by bankruptcy, insolvency or similar laws of
general application relating to the enforcement of creditors'
rights and except to the extent specific remedies may generally
be limited by equitable principles.
(c) Ownership and Liens. Pledgor has good and marketable
title to the Collateral free and clear of all liens, security
interests, encumbrances or adverse claims, except for the
security interest created by this Agreement. No dispute, right
of setoff, counterclaim or defense exists with respect to all or
any part of the Collateral. Pledgor has not executed any other
security agreement currently affecting the Collateral and no
financing statement or other instrument similar in effect
covering all or any part of the Collateral is on file in any
recording office except as may have been executed or filed in
favor of Secured Party.
(d) No Conflicts or Consents. Neither the ownership, the
intended use of the Collateral by Pledgor, the grant of the
security interest by Pledgor to Secured Party herein nor the
exercise by Secured Party of its rights or remedies hereunder,
will (i) conflict with any provision of (A) any domestic or
foreign law, statute, rule or regulation, (B) the articles or
certificate of incorporation, bylaws of Pledgor or (C) any
agreement, judgment, license, order or permit applicable to or
binding upon Pledgor or otherwise affecting the Collateral, or
(ii) result in or require the creation of any lien, charge or
encumbrance upon any assets or properties of Pledgor or of any
person except as may be expressly contemplated in the Related
Documents. Except as expressly contemplated in the Related
Documents, no consent, approval, authorization or order of, and
no notice to or filing with any court, governmental authority or
third party is required in connection with the grant by Pledgor
of the security interest herein or the exercise by Secured Party
of its rights and remedies hereunder.
(e) Security Interest. Pledgor has and will have at all
times full right, power and authority to grant a security
interest in the Collateral to Secured Party in the manner
provided herein, free and clear of any lien, security interest or
other charge or encumbrance. This Agreement creates a legal,
valid and binding security interest in favor of Secured Party in
the Collateral.
(f) Location. Pledgor's residence or chief executive
office, as the case may be, and the office where the records
concerning the Collateral are kept is located at its address set
forth on the signature page hereof.
(g) Solvency of Pledgor. As of the date hereof, and after
giving effect to this Agreement and the completion of all other
transactions contemplated by Pledgor at the time of the execution
of this Agreement, (i) Pledgor is and will be solvent, (ii) the
fair saleable value of Pledgor's assets exceeds and will continue
to exceed Pledgor's liabilities (both fixed and contingent),
(iii) Pledgor is paying and will continue to be able to pay its
debts as they mature, and (iv) if Pledgor is not an individual,
Pledgor has and will have sufficient capital to carry on
Pledgor's businesses and all businesses in which Pledgor is about
to engage.
(h) To the extent applicable, Pledgor has delivered to
Secured Party the certificate or passbook issued under or with
respect to the Account, and such certificate or passbook, if any,
shall remain in Secured Party's possession until such time as
this Agreement is terminated in accordance with the terms hereof.
5. Affirmative Covenants. Pledgor will comply with the
covenants contained in this Section at all times during the
period of time this Agreement is effective unless Secured Party
shall otherwise consent in writing.
(a) Ownership and Liens. Pledgor will maintain good and
marketable title to all Collateral free and clear of all liens,
security interests, encumbrances or adverse claims, except for
the security interest created by this Agreement and the security
interests and other encumbrances expressly permitted by the
Related Documents. Pledgor will not permit any dispute, right of
setoff, counterclaim or defense to exist with respect to all or
any part of the Collateral. Pledgor will cause any financing
statement or other security instrument with respect to the
Collateral to be terminated, except as may exist or as may have
been filed in favor of Secured Party. Pledgor will defend at its
expense Secured Party's right, title and security interest in and
to the Collateral against the claims of any third party.
(b) Inspection of Books and Records. Pledgor will keep
adequate records concerning the Collateral and will permit
Secured Party and all representatives and agents appointed by
Secured Party to inspect Pledgor's books and records of or
relating to the Collateral at any time during normal business
hours, to make and take away photocopies, photographs and
printouts thereof and to write down and record any such
information.
(c) Adverse Claim. Pledgor covenants and agrees to
promptly notify Secured Party of any claim, action or proceeding
affecting title to the Collateral, or any part thereof, or the
security interest created hereunder and, at Pledgor's expense,
defend Secured Party's security interest in the Collateral
against the claims of any third party. Pledgor also covenants
and agrees to promptly deliver to Secured Party a copy of all
written notices received by Pledgor with respect to the
Collateral, including without limitation, notices received form
the issuer of any securities pledged hereunder as Collateral.
(d) Further Assurances. Pledgor will contemporaneously
with the execution hereof and from time to time thereafter at its
expense promptly execute and deliver all further instruments and
documents and take all further action necessary or appropriate or
that Secured Party may request in order (i) to perfect and
protect the security interest created or purported to be created
hereby and the first priority of such security interest, (ii) to
enable Secured Party to exercise and enforce its rights and
remedies hereunder in respect of the Collateral, and (iii) to
otherwise effect the purposes of this Agreement, including
without limitation: (A) executing and filing any financing or
continuation statements, or any amendments thereto; (B) obtaining
written confirmation from the issuer of any securities pledged as
Collateral of the pledge of such securities, in form and
substance satisfactory to Secured Party; (C) cooperating with
Secured Party in registering the pledge of any securities pledged
as Collateral with the issuer of such securities; (D) delivering
notice of Secured Party's security interest in any securities
pledged as Collateral to any financial intermediary, clearing
corporation or other party required by Secured Party, in form and
substance satisfactory to Secured Party; and (E) obtaining
written confirmation of the pledge of any securities constituting
Collateral from any financial intermediary, clearing corporation
or other party required by Secured Party, in form and substance
satisfactory to Secured Party. If all or any part of the
Collateral is securities issued by an agency or department of the
United States, Pledgor covenants and agrees, at Secured Party's
request, to cooperate in registering such securities in Secured
Party's name or with Secured Party's account maintained with a
Federal Reserve Bank. At the option of the Secured Party, a
carbon, photographic, facsimile or other reproduction or type of
copy of this Agreement or of a financing statement covering the
Collateral shall be sufficient as a financing statement and may
be filed as a financing statement.
(e) Should Pledgor ever obtain possession of the
certificate or passbook issued under or with respect to the
Account while this Agreement remains in effect, Pledgor agrees to
immediately deliver such certificate or passbook to Secured
Party, and Pledgor's obligations to Secured Party under this
Agreement shall not be modified or terminated as a result of
Pledgor's possession (whether temporary or otherwise) of any
certificate, passbook or other document or agreement issued under
or with respect to the Account.
6. Negative Covenants. Pledgor will comply with the
covenants contained in this Section at all times during the
period of time this Agreement is effective, unless Secured Party
shall otherwise consent in writing.
(a) Transfer or Encumbrance. Pledgor will not (i) sell,
assign (by operation of law or otherwise) or transfer Pledgor's
rights in any of the Collateral, (ii) xxxxx x xxxx or security
interest in or execute, file or record any financing statement or
other security instrument with respect to the Collateral to any
party other than Secured Party, or (iii) deliver actual or
constructive possession of any certificate, instrument or
document evidencing and/or representing any of the Collateral to
any party other than Secured Party.
(b) Impairment of Security Interest. Pledgor will not take
or fail to take any action which would in any manner impair the
value or enforceability of Secured Party's security interest in
any Collateral.
7. Rights of Secured Party. Secured Party shall have the
rights contained in this Section at all times during the period
of time this Agreement is effective.
(a) Power of Attorney. Pledgor hereby irrevocably appoints
Secured Party as Pledgor's attorney-in-fact, such power of
attorney being coupled with an interest, with full authority in
the place and stead of Pledgor and in the name of Pledgor or
otherwise, upon the occurrence of an Event of Default, to take
any action and to execute any instrument which Secured Party may
from time to time in Secured Party's discretion deem necessary or
appropriate to accomplish the action: (i) transfer any
securities, instruments, documents or certificates pledged as
Collateral in the name of Secured Party or its nominee; (ii) use
any interest, premium or principal payments, conversion or
redemption proceeds or other cash proceeds received in connection
with any Collateral to reduce any of the Indebtedness; (iii)
exchange any of the securities pledged as Collateral for any
other property upon any merger, consolidation, reorganization,
recapitalization or other readjustment of the issuer thereof,
and, in connection therewith, to deposit and deliver any and all
of such securities with any committee, depository, transfer
agent, registrar or other designated agent upon such terms and
conditions as Secured Party may deem necessary or appropriate;
(iv) exercise or comply with any conversion, exchange,
redemption, subscription or any other right, privilege or option
pertaining to any securities pledged as Collateral; provided,
however, except as provided herein, Secured Party shall not have
duty to exercise or comply with any such right, privilege or
option (whether conversion, redemption or otherwise) and shall
not be responsible for any delay or failure to do so; and (v)
file any claims or take any action or institute any proceedings
which Secured Party may deem necessary or appropriate for the
collection and/or preservation of the Collateral or otherwise to
enforce the rights of Secured Party with respect to the
Collateral.
(b) Performance by Secured Party. If Pledgor fails to
perform any agreement or obligation provided herein, Secured
Party may itself perform, or cause performance of, such agreement
or obligation, and the expenses of Secured Party incurred in
connection therewith shall be a part of the Indebtedness, secured
by the Collateral and payable by Pledgor on demand.
Notwithstanding any other provision herein to the contrary,
Secured Party does not have any duty to exercise or continue to
exercise any of the foregoing rights and shall not be responsible
for any failure to do so or for any delay in doing so.
8. Events of Default. Each of the following constitutes an
"Event of Default" under this Agreement:
(a) Failure to Pay Indebtedness. The failure, refusal or
neglect of Pledgor to make any payment of principal or interest
on the Indebtedness, or any portion thereof, within three (3)
business days after the same shall become due and payable; or
(b) Non-Performance of Covenants. The failure of Pledgor
or any Obligated Party to timely and properly observe, keep or
perform any covenant, agreement, warranty or condition required
herein or in any of the other Related Documents and such failure
continues for a period of 30 days or more after written notice by
the Secured Party to the Pledgor or any Obligated Party; or
(c) Default Under Other Related Documents. The occurrence
of an event of default under any of the other Related Documents;
or
(d) False Representation. Any representation contained
herein or in any of the other Related Documents made by Pledgor
or any Obligated Party shall prove to be false or misleading in
any material respect at the time made; or
(e) Default to Third Party. The occurrence of any event
which results in the acceleration of the maturity of any
indebtedness amounting in the aggregate to $5,000,000 or more
owing by Pledgor or any Obligated Party to any third party under
any agreement or undertaking; or
(f) Bankruptcy or Insolvency. If Pledgor or any Obligated
Party: (i) becomes insolvent, or makes a transfer in fraud of
creditors, or makes an assignment for the benefit of creditors,
or admits in writing its inability to pay its debts as they
become due; (ii) generally is not paying its debts as such debts
become due; (iii) has a receiver, trustee or custodian appointed
for, or take possession of, all or substantially all of the
assets of such party or any of the Collateral, either in a
proceeding brought by such party or in a proceeding brought
against such party and such appointment is not discharged or such
possession is not terminated within sixty (60) days after the
effective date thereof or such party consents to or acquiesces in
such appointment or possession; (iv) files a petition for relief
under the United States Bankruptcy Code or any other present or
future federal or state insolvency, bankruptcy or similar law
(all of the foregoing hereinafter collectively called "Applicable
Bankruptcy Law") or an involuntary petition for relief so filed
against such party under any Applicable Bankruptcy Law and such
involuntary petition is not dismissed within sixty (60) days
after the filing thereof, or an order for relief naming such
party is entered under any Applicable Bankruptcy Law, or any
composition, rearrangement, extension, reorganization or other
relief of debtors now or hereafter existing is requested or
consented to by such party; (v) fails to have discharged within a
period of sixty (60) days any attachment, sequestration or
similar writ levied upon any property of such party; or (vi)
fails to pay within thirty (30) days any final money judgment
against such party; or
(g) Execution on Collateral. The Collateral or any portion
thereof is taken on execution or other process of law in any
action against Pledgor; or
(h) Abandonment. Pledgor abandons the Collateral or any
portion thereof; or
(i) Action by Other Lienholder. The holder of any lien or
security interest on any of the assets of Pledgor, including
without limitation, the Collateral (without hereby implying the
consent of Secured Party to the existence or creation of any such
lien or security interest on the Collateral), declares a default
thereunder or institutes foreclosure or other proceedings for the
enforcement of its remedies thereunder; or
(j) Liquidation, Death and Related Events. If Pledgor or
any Obligated Party is an entity, the liquidation, dissolution,
merger or consolidation of any such entity; or
(k) Bankruptcy of Issuer. (i) The issuer of any securities
constituting Collateral files a petition for relief under any
Applicable Bankruptcy Law, (ii) an involuntary petition for
relief is filed against any such issuer under any Applicable
Bankruptcy Law and such involuntary petition is not dismissed
within thirty (30) days after the filing thereof, or (iii) an
order for relief naming any such issuer is entered under any
Applicable Bankruptcy Law; provided, however, that the events
described in clauses (i), (ii) and (iii) of this Section 8 shall
not constitute an Event of Default if Pledgor provides substitute
or additional collateral within 30 days after being notified by
Secured Party that an event described in clauses (i), (ii) or
(iii) has occurred.
9. Remedies and Related Rights. If an Event of Default
shall have occurred and be continuing, and without limiting any
other rights and remedies provided herein, under any of the other
Related Documents or otherwise available to Secured Party,
Secured Party may exercise one or more of the rights and remedies
provided in this Section.
(a) Remedies. Secured Party may from time to time at its
discretion, without limitation and without notice except as
expressly provided in any of the Related Documents:
(i) exercise in respect of the Collateral all the
rights and remedies of a secured party under the Code
(whether or not the Code applies to the affected
Collateral);
(ii) reduce its claim to judgment or foreclose or
otherwise enforce, in whole or in part, the security
interest granted hereunder by any available judicial
procedure;
(iii) surrender the Account to the issuer thereof and
obtain payment thereunder subject to any early withdrawal
penalty, where applicable;
(iv) sell or otherwise dispose of, at its office, on
the premises of Pledgor or elsewhere, the Collateral, as a
unit or in parcels, by public or private proceedings, and by
way of one or more contracts (it being agreed that the sale
or other disposition of any part of the Collateral shall not
exhaust Secured Party's power of sale, but sales or other
disposition of any part of the Collateral shall not exhaust
Secured Party's power of sale, but sales or other
dispositions may be made from time to time until all of the
Collateral has been sold or disposed of or until the
Indebtedness has been paid and performed in full), and at
any such sale or other disposition it shall not be necessary
to exhibit any of the Collateral;
(v) buy the Collateral, or any portion thereof, at any
public sale;
(vi) buy the Collateral, or any portion thereof, at any
private sale if the Collateral is of a type customarily sold
in a recognized market or is of a type which is the subject
of widely distributed standard price quotations;
(vii) apply for the appointment of a receiver for the
Collateral, and Pledgor hereby consents to any such
appointment; and
(viii) at its option, retain the Collateral in
satisfaction of the Indebtedness whenever the circumstances
are such that Secured Party is entitled to do so under the
Code or otherwise.
Pledgor agrees that in the event Pledgor is entitled to receive
any notice under the Code of the sale or other disposition of any
Collateral, reasonable notice shall be deemed given when such
notice is deposited in a depository receptacle under the care and
custody of the United States Postal Service, postage prepaid, at
Pledgor's address set forth on the signature page hereof, five
(5) days prior to the date of any public sale, or after which a
private sale, of any of such Collateral is to be held. Secured
Party shall not be obliged to make any sale of Collateral
regardless of notice of sale having been given. Secured Party
may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to
which it was so adjourned. Pledgor further acknowledges and
agrees that the redemption by Secured Party of any certificate of
deposit pledged as Collateral shall be deemed to be a
commercially reasonable disposition under Section 10:9-504(3) of
the Code.
(b) Application of Proceeds. If any Event of Default shall
have occurred and be continuing, Secured Party may at its
discretion apply or use any cash held by Secured Party as
Collateral, and any cash proceeds received by Secured Party in
respect of any sale or other disposition of, collection from, or
other realization upon, all or any part of the Collateral as
follows in such order and manner as Secured Party may elect:
(i) to the repayment or reimbursement of the reasonable
costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) incurred by Secured
Party in connection with (A) the administration of the
Related Documents, (B) the custody, preservation, use or
operation of, or the sale of collection form, or other
realization upon, the Collateral, and (C) the exercise or
enforcement of any of the rights and remedies of Secured
Party hereunder;
(ii) to the payment or other satisfaction of any liens
and other encumbrances upon the Collateral;
(iii) to the satisfaction of the Indebtedness;
(iv) by holding such cash and proceeds as Collateral;
(v) to the payment of any other amounts required by
applicable law (including without limitation, Section 10:9-
504(1)(c) of the Code or any other applicable statutory
provision).
(c) Deficiency. In the event that the proceeds of any sale
of, collection from, or other realization upon, all or any part
of the Collateral by Secured Party are insufficient to pay all
amounts to which Secured Party is legally entitled, Pledgor and
any party who guaranteed or is otherwise obligated to pay all or
any portion of the Indebtedness shall be liable for the
deficiency, together with interest thereon as provided in the
Related Documents.
(d) Non-Judicial Remedies. In granting to Secured Party
the power to enforce its rights hereunder without prior judicial
process or judicial hearing, Pledgor expressly waives, renounces
and knowingly relinquishes any legal right which might otherwise
require Secured Party to enforce its rights by judicial process.
Pledgor recognizes and concedes that non-judicial remedies are
consistent with the usage of trade, are responsive to commercial
necessity and are the result of a bargain at arm's length.
Nothing herein is intended to prevent Secured Party or Pledgor
from resorting to judicial process at either party's option.
(e) Other Recourse. Pledgor waives any right to require
Secured Party to proceed against any third party, exhaust any
Collateral or other security for the Indebtedness, or to have any
third party joined with Pledgor in any suit arising out of the
Indebtedness or any of the Indebtedness or any of the Related
Documents, or pursue any other remedy available to Secured Party.
Pledgor further waives any and all notice of acceptance of this
Agreement and of the creation, modification, rearrangement,
renewal or extension of the Indebtedness. Pledgor further waives
any defense arising by reason of any disability or other defense
of any third party or by reason of the cessation from any cause
whatsoever of the liability of any third party. Until all of the
Indebtedness shall have been paid in full, Pledgor shall have no
right of subrogation and Pledgor waives the right to enforce any
remedy which Secured Party has or may hereafter have against any
third party, and waives any benefit of and any right to
participate in any other security whatsoever now or hereafter
held by Secured Party. Pledgor authorizes Secured Party, and
without notice or demand and without any reservation of rights
against Pledgor and without affecting Pledgor's liability
hereunder or on the Indebtedness, to (i) take or hold any other
property of any type from any third party as security for the
Indebtedness, and exchange, enforce, waive and release any or all
of such other property, (ii) apply such other property and direct
the order or manner of sale thereof as Secured Party may in its
discretion determine, (iii) renew, extend, accelerate, modify,
compromise, settle or release any of the Indebtedness or other
security for the Indebtedness, (iv) waive, enforce or modify any
of the provisions of any of the Related Documents executed by any
third party, and (v) release or substitute any third party.
(f) Secured Party's rights under this Agreement are in
addition to any statutory rights of offset granted to Secured
Party under applicable Louisiana law.
10. Indemnity. Pledgor hereby indemnifies and agrees to
hold harmless Secured Party, and its officers, directors,
employees, agents and representatives (each an "Indemnified
Person") from and against any and all liabilities, obligations,
claims, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature
(collectively, the "Claims") which may be imposed on, incurred
by, or asserted against, any Indemnified Person (whether or not
caused by any Indemnified Person's sole, concurrent or
contributory negligence) arising in connection with the Related
Documents, the Indebtedness or the Collateral (including without
limitation, the enforcement of the Related Documents and the
defense of any Indemnified Person's actions and/or inactions in
connection with the Related Documents), except to the limited
extent the Claims against an Indemnified Person are proximately
caused by such Indemnified Person's gross negligence or willful
misconduct. The indemnification provided for in this Section
shall survive the termination of this Agreement and shall extend
and continue to benefit each individual or entity who is or has
at any time been an Indemnified Person hereunder.
11. Miscellaneous.
(a) Entire Agreement. This Agreement contains the entire
agreement of Secured Party and Pledgor with respect to the
Collateral. If the parties hereto are parties to any prior
agreement, either written or oral, relating to the Collateral,
the terms of this Agreement shall amend and supersede the terms
of such prior agreements as to transactions on or after the
effective date of this Agreement, but all security agreements,
financing statements, guaranties, other contracts and notices for
the benefit of Secured Party shall continue in full force and
effect to secure the Indebtedness unless Secured Party
specifically releases its rights thereunder by separate release.
(b) Amendment. No modification, consent or amendment of
any provision of this Agreement or any of the other Related
Documents shall be valid or effective unless the same is in
writing and signed by the party against whom it is sought to be
enforced.
(c) Actions by Secured Party. The lien, security interest
and other security rights of Secured Party hereunder shall not be
impaired by (i) any renewal, extension, increase or modification
with respect to the Indebtedness, (ii) any surrender, compromise,
release, renewal, extension, exchange or substitution which
Secured Party may grant with respect to the Collateral, or (iii)
any release or indulgence granted to any endorser, guarantor or
surety of the Indebtedness. The taking of additional security by
Secured Party shall not release or impair the lien, security
interest or other security rights of Secured Party hereunder or
affect the obligations of Pledgor hereunder.
(d) Waiver by Secured Party. Secured Party may waive any
Event of Default without waiving any other prior or subsequent
Event of Default. Secured Party may remedy any default without
waiving the Event of Default remedied. Neither the failure by
Secured Party to exercise, nor the delay by Secured Party in
exercising, any right or remedy upon any Event of Default shall
be construed as a waiver of such Event of Default or as a waiver
of the right to exercise any such right or remedy at a later
date. No single or partial exercise by Secured Party of any
right or remedy hereunder shall exhaust the same or shall
preclude any other or further exercise thereof, and every such
right or remedy hereunder may be exercised at any time. No
waiver of any provision hereof or consent to any departure by
Pledgor therefrom shall be effective unless the same shall be in
writing and signed by Secured Party and then such waiver or
consent shall be effective only in the specific instances, for
the purpose for which given and to the extent therein specified.
No notice to or demand on Pledgor in any case shall of itself
entitle Pledgor to any other or further notice or demand in
similar or other circumstances.
(e) Costs and Expenses. Pledgor will upon demand pay to
Secured Party the amount of any and all costs and expenses
(including without limitation, attorneys' fees and expenses),
which Secured Party may incur in connection with (i) the
transactions which give rise to the Related Documents, (ii) the
preparation of this Agreement and the perfection and preservation
of the security interests granted under the Related Documents,
(iii) the administration of the Related Documents, (iv) the
custody, preservation, use or operation of, or the sale of,
collection from, or other realization upon, the Collateral, (v)
the exercise or enforcement of any of the rights of Secured Party
under the Related Documents, or (vi) the failure by Pledgor to
perform or observe any of the provisions hereof.
(f) CONSENT TO JURISDICTION. PLEDGOR HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR LOUISIANA STATE COURT SITTING IN NEW ORLEANS,
LOUISIANA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY OF THE OTHER RELATED DOCUMENTS AND
PLEDGOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT ANY SUCH COURT IS AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF
SECURED PARTY TO BRING PROCEEDINGS AGAINST PLEDGOR IN THE COURTS
OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY PLEDGOR
AGAINST SECURED PARTY OR ANY AFFILIATE OF SECURED PARTY
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING
OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY OTHER
RELATED DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW ORLEANS,
LOUISIANA.
(g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF LOUISIANA
WITHOUT REGARD TO ANY CONFLICT OF LAWS RULES OR PROVISIONS
THEREOF AND APPLICABLE FEDERAL LAWS, EXCEPT TO THE EXTENT
PERFECTION AND THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE
SECURITY INTEREST GRANTED HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN
THE STATE OF LOUISIANA.
(h) JURY WAIVER. PLEDGOR AND SECURED PARTY (BY ITS
ACCEPTANCE HEREOF) HEREBY VOLUNTARILY, KNOWINGLY, IRREVOCABLY AND
UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE (WHETHER BASED UPON CONTRACT, TORT, OR
OTHERWISE) BETWEEN PLEDGOR AND SECURED PARTY ARISING OUT OF OR IN
ANY WAY RELATED TO THIS AGREEMENT, OR ANY OTHER RELATED DOCUMENT,
OR ANY RELATIONSHIP BETWEEN SECURED PARTY AND PLEDGOR. THIS
PROVISION IS A MATERIAL INDUCEMENT TO SECURED PARTY TO PROVIDE
THE FINANCING DESCRIBED HEREIN OR IN THE OTHER RELATED DOCUMENTS.
(i) Severability. If any provision of this Agreement is
held by a court of competent jurisdiction to be illegal, invalid
or unenforceable under present or future laws, such provision
shall be fully severable, shall not impair or invalidate the
remainder of this Agreement and the effect thereof shall be
confined to the provision held to be illegal, invalid or
unenforceable.
(j) No Obligation. Nothing contained herein shall be
construed as an obligation on the part of Secured Party to extend
or continue to extend credit to Pledgor.
(k) Notices. All notices, requests, demands or other
communications required or permitted to be given pursuant to this
Agreement shall be in writing and given by (i) personal delivery,
(ii) expedited delivery service with proof of delivery, or (iii)
United States mail, postage prepaid, registered or certified
mail, return receipt requested, sent to the intended addressee at
the address set forth on the signature page hereof or to such
different address as the addressee shall have designated by
written notice sent pursuant to the terms hereof and shall be
deemed to have been received either, in the case of expedited
delivery services as of the date of first attempted delivery at
the address and in the manner provided herein, or in the case of
mail, upon deposit in a depository receptacle under the care and
custody of the United States Postal Service. Either party shall
have the right to change its address for notice hereunder to any
other location within the continental United States by notice to
the other party of such new address at least thirty (30) days
prior to the effective date of such new address.
(l) Binding Effects and Assignment. This Agreement (i)
creates a continuing security interest in the Collateral, (ii)
shall be binding on Pledgor and the heirs, executors,
administrators, personal representatives, successors and assigns
of Pledgor and (iii) shall inure to the benefit of Secured Party
and its successors and assigns. Without limiting the generality
of the foregoing, Secured Party may pledge, assign or otherwise
transfer the Indebtedness and its rights under this Agreement and
any of the other Related Documents to any other party. Pledgor's
rights and obligations hereunder may not be assigned or otherwise
transferred without the prior written consent of Secured Party.
(m) Termination. It is contemplated by the parties hereto
that from time to time there may be no outstanding Indebtedness,
but notwithstanding such occurrences, this Agreement shall remain
valid and shall be in full force and effect as to subsequent
outstanding Indebtedness. Upon (i) the satisfaction in full of
the Indebtedness, (ii) the termination or expiration of any
commitment of Secured Party to extend credit to Pledgor, (iii)
written request for the termination hereof delivered by Pledgor
to Secured Party, and (iv) written release delivered by Secured
Party to Pledgor, this Agreement and the Security Interests
created hereby shall terminate. Upon termination of this
Agreement and Pledgor's written request, Secured Party will, at
Pledgor's sole cost and expense, return to Pledgor such of the
Collateral as shall not have been sold or otherwise disposed of
or applied pursuant to the terms hereof and execute and deliver
to Pledgor such documents as Pledgor shall reasonably request to
evidence such termination.
(n) Cumulative Rights. All rights and remedies of Secured
Party hereunder are cumulative of each other and of every other
right or remedy which Secured Party may otherwise have at law or
in equity or under any of the other Related Documents, and the
exercise of one or more of such rights or remedies shall not
prejudice or impair the concurrent or subsequent exercise of any
other rights or remedies.
(o) Gender and Number. Within this Agreement, words of any
gender shall be held and construed to include the other gender,
and words in the singular number shall be held and construed to
include the plural and words in the plural number shall be held
and construed to include the singular, unless in each instance
the context requires otherwise.
(p) Descriptive Headings. The headings in this Agreement
are for convenience only and shall in no way enlarge, limit or
define the scope or meaning of the various and several provisions
hereof.
(q) NO ORAL AGREEMENTS. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES HERETO. THIS WRITTEN PLEDGE
AGREEMENT, THE WRITTEN APPLICATION AND THE OTHER WRITTEN RELATED
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
[REMAINDER OF THIS PAGE LEFT BLANK]
EXECUTED as of the date first written above.
Pledgor:
Pledgor's Address: R&B FALCON CORPORATION
901 Threadneedle By:
Xxxxxxx, Xxxxx 00000
Title:
ACCEPTED: Secured Party:
Secured Party's Address: BANK ONE, LOUISIANA,
NATIONAL ASSOCIATION
000 Xx. Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000 By:
Title:
