EXHIBIT 10.11
Bank One BANK1ONE
APPLICATION AND AGREEMENT FOR
IRREVOCABLE STANDBY LETTER OF CREDIT
Date: August 30, 1999
TO: Bank One Louisiana, N.A. ("Issuer")
000 Xx. Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
Please issue an Irrevocable Standby Letter of Credit as set forth
below and forward same to your correspondent for delivery to the
Beneficiary or, at your option, forward same directly to the
Beneficiary by:
Delivery to Relationship Manager
Advising Bank (Name and Address) For account of Applicant(s)
(Issuer use only unless (Name and Address)
Applicant designates R & B Falcon Corporation
advising bank) 000 Xxxxxxxxxxxx
Xxxxxxx, Xxxxx 00000
N/A Phone 000-000-0000
To Beneficiary (Name and Address) Amount: (Figures) $50,000,000.00
(In Words) Fifty Million and
No/100 Dollars
Insert Rider 1 from Exhibit A attached
hereto
Expiry Date: September ___,2004
at the counters of the Banc One
LC Processing Center, Dallas, Texas
Available against Beneficiary's draft(s) at sight drawn on Issuer
and accompanied by the following documents:
Original of Beneficiary's manually signed statement stating that:
See attached form of letter of credit (Exhibit B hereto)
(Complete only when the Beneficiary's bank or correspondent is to
issue its guarantee or undertaking based on the Issued Standby
Letter of Credit)
Request Beneficiary's bank to issue and deliver their_________
(specify type of bid or performance bond, guarantee, undertaking,
or other)
In favor of (Name/Attention):
(Address/Street):
(Address/City):
(Country):
(Telephone/Fax):
For an amount not exceeding that specified above, effective
immediately and expiring at their office on ____________________
covering________________________________________________ .
(specify number of bid or performance bond. etc.)
Partial drawings permitted? [ ] Yes [x] No
If drawings are allowed in installments within given periods and
no drawing is made for an installment within the applicable
period, the Letter of Credit, [] is [] is not available for
subsequent installments.
All banking charges other than Issuer's are for [ ] Beneficiary
[x] Applicant.
We hereby certify that transactions covered by the Application
are not prohibited under the Foreign Assets Control Regulations
of the United States Treasury Department or the Department of
Commerce, Export Administration Regulations and that any
transaction covered by this Application conforms in every respect
with all existing United States Government and other applicable
regulations.
We hereby authorize you to issue this Letter of Credit in
substantially the form attached hereto as Exhibit B with such
variations from the above terms as you may, in your discretion,
determine are necessary and are not materially inconsistent with
this Application. The Letter of Credit to be opened hereunder
will be subject to the Uniform Customs and Practice for
Documentary Credits (1993 Revision). International Chamber of
Commerce Publication No. 500, except that as to matters not
governed by the Uniform Customs and Practice, the laws of the
State o New York shall apply. By signing at the place provided
on the last page of the Application and Agreement, the Applicant
agrees to the terms and conditions set forth in the Agreement on
the reverse side of this Application and the following pages.
AGREEMENT FOR
STANDBY LETTER OF CREDIT
The undersigned ("Applicant") agrees with Issuer that in
consideration of the issuance of each irrevocable standby letter
of credit (a "Credit") at the request of Applicant. the following
terms and conditions will govern each such Credit, unless they
are expressly changed In the Credit or the Application for the
Credit, as approved by Issuer, and, with regard to the provisions
of Section 6 and 7 herein, regardless of whether the Credit or
the Application provide otherwise:
1. REIMBURSEMENTS. Applicant agrees to pay on demand, in U.S.
dollars, to Issuer at the Banc One LC Processing Center, 0000
Xxxx Xxxxxx (11 Ith Floor), Dallas, Texas, the amount of each
draft drawn under or purporting to be drawn under the Credit.
Demand may be made in advance of payment at the request of
Issuer.
2. FEES AND INTEREST. Applicant agrees to pay Issuer:
(a) On demand, Issuer's customary commissions and fees
in effect from time to time and all costs and expenses,
including reasonable attorneys' fees. paid or incurred by
Issuer in connection with the administration or
enforcement of this Agreement or the Credit. and any
adviser, confirmer or other nominated person's fees and
costs that are chargeable to or paid by Issue in
connection with this Agreement on the Credit.
(b) Interest on all sums advanced by Issuer without
reimbursement by Applicant at the per annum rate equal to
the lesser of
(i) eighteen percent (18%) or
(ii) the Prime Rate on the date of advance by the
Issuer, provided that such rate of interest shall not
exceed the maximum rate of interest which may be charged
under applicable law. The "Prime Rate" shall mean the
rate of interest announced by the Issuer from time to
time as its prime rate for interest rate determinations
(which may or may not be the lowest interest rate charged
by such bank), to be computed for actual days unpaid on a
360-day year basis;
(c) In the event any change in any law or regulation, or
in any interpretation by court or administrative or
governmental authority charged with the administration
thereof shall either:
(i) impose, modify or make applicable any reserve,
special deposit, or similar requirement against letters
of credit issued by the Issuer; or
(ii) impose on Issuer any other condition regarding
this Agreement or the Credit;
and the result of any event referred to above shall
be to increase the cost to Issuer of issuing or
maintaining the Credit, then upon demand by Issuer,
Applicant shall immediately pay to Issuer, such
additional amounts as shall, in the judgment of Issuer,
be sufficient to compensate Issuer for such increased
cost, together with interest on each such amount from the
date demanded until payment In full at the rate provided
in subsection (b) above; and Insert Rider 2 from Exhibit
A attached hereto.
3. PAYMENTS.
(a) Payments due from Applicant hereunder shall be made
without withholding, deduction, or set-off and shall be
made free and clear of any taxes other than taxes
directly imposed on Issuer.
(b) To effect any payment due hereunder, Applicant
authorizes Issuer to debit any account that Applicant may
have with Issuer or any direct or Indirect subsidiary of
BANK ONE CORPORATION (each such subsidiary referred to
herein as "Banc One Affiliate").
4. REPRESENTATIONS AND WARRANTIES. In order to induce Issuer to
issue the Credit, Applicant:
(a) Represents and warrants to Issuer that each financial
statement of Applicant furnished to Issuer was correct and
complete and truly presented the financial condition of
Applicant as of the date thereof and, since the date of
the last such financial statement, there has been no
material adverse change in the financial condition of
Applicant, and
(b) Makes to Issuer the following representations and
warranties:
(i) Applicant is (check one); [x] A corporation organized
under the laws of the State of Delaware
(ii) Applicant has the power and is duly authorized to
execute and deliver this Agreement and is and will be
duly authorized to execute and deliver each Application
for a Credit and each collateral document furnished to
Issuer in connection with the Credit or in the
Application for the Credit. This Agreement, each
Application for the Credit and each document creating or
granting a security interest in Collateral (as
hereinafter defined), when executed and delivered, will
constitute the valid and binding obligations of
Applicant, enforceable in accordance with their terms,
except as limited by bankruptcy. insolvency or similar
laws of general application affecting the enforcement of
creditors' rights generally and except to the extent that
general principles of equity might affect the specific
enforcement of this Agreement or such collateral
documents.
(iii) There is no litigation or administrative proceeding
pending or threatened against Applicant which might, if
adversely determined, materially affect Applicant's
ability to perform its obligations under this Agreement
(iv) No default exists, nor has any event, act or
omission occurred which, with the giving of notice or the
passage of time, would constitute a default under any
instrument or agreement evidencing or securing any
indebtedness or liability of Applicant to any person.
(v) Applicant has no indebtedness for borrowed money,
nor any obligation contingent or otherwise, directly
or indirectly guaranteeing or in any manner providing
for the payment of the indebtedness of another, except
those disclosed on the most recent financial statements
of Applicant furnished to Issuer and except for
endorsements for collection or deposit in the ordinary
course of business.
(vi) Applicant has good and marketable title to all
of the Collateral (as hereinafter defined), subject to no
lien, security Interest, mortgage, encumbrance or charge
of any kind except as provided herein.
5. COVENANTS. Applicant agrees that so long as drawing is
available under the Credit, and until Issuer has been
reimbursed for all drafts honored by it under any Credit,
Applicant will comply in a timely manner with:
(a) Its obligations hereunder and under all security
agreements, mortgages, deeds of trust, or assignments
securing the Obligations as defined In Section 8, herein
and
(b) The following covenants:
(i) Applicant shall furnish to Issuer such financial
information regarding Applicant as Issuer may from time
to time reasonably request and shall permit
representatives of Issuer to visit and inspect the
properties and books and records of Applicant at any
reasonable time and as often as may reasonably be
desired.
(ii) Applicant shall pay all lawful taxes, assessments and
governmental charges upon it or against its properties
prior to the date of which penalties attach, unless
and to the extent only that the same shall be contested
in good faith and by appropriate proceedings.
(iii) Applicant shall not sell, lease, transfer or
otherwise dispose of all or a substantial part of its
assets (other than sales made in the ordinary course of
business).
(iv) If Applicant is a corporation, Applicant shall
maintain its corporate existence and not merge or
consolidate with or into any other corporaiton.
6. RESPONSIBILITY OF ISSUER
(a) Delivery to Issuer or any of its correspondents of any
documents purporting to comply with the requirements of
the Credit shall be sufficient evidence of the validity,
genuineness and sufficiency thereof and of the good faith
and proper performance of drawers and user of the Credit,
their agents and assignees, and Issuer and its
correspondents may rely thereon without liability or
responsibility with respect thereto, even if such
documents should in fact prove to be in any or all
respects invalid, insufficient, fraudulent or forged.
(b) Issuer is expressly authorized and directed to honor any
request for payment which is made under and in compliance
with the terms of the Credit without regard to, and
without any duty on Issuer's part to inquire into, the
existence of any disputes or controversies between
Applicant, any beneficiary of the Credit or any other
person, firm or corporation or the rights, duties or
liabilities of any of them.
(c) Issuer shall not be liable to Applicant or any third party
for:
(i) the use which may be made of the Credit or for any act
or omission of any beneficiary thereof,
(ii) any delay in giving or failing to give any notice,
(iii) any error, neglect or default of any of its
correspondents,
(iv) the validity, sufficiency or genuineness of any
document assigning or purporting to assign the Credit or
any benefits thereunder or any act in reliance thereon,
(v) errors in translation or in the interpretation
of any of the terms of the Credit, or
(vi) errors, delays, misdeliveries or losses in the
transmission of notices and communications by means of
SWIFT, electronic mail, telex, twx, tefecopy, telefax or
computer generated telecommunications or documents or
items forwarded in connection with the Credit or any
relevant draft.
(d) Any action taken or omitted by Issuer or its
correspondents in connection with the Credit, any
instructions of Applicant or any drafts, documents or
merchandise relative thereto shall, if in good faith, be
conclusively deemed authorized by Applicant, whether
expressly so or not.
(e) If the Credit shall have been requested by Applicant
for the accommodation of a third party, any instruction,
consent, approval and other action or inaction of such
third party with respect to the Credit or transactions
thereunder shall be deemed to be the act or omission of
Applicant for all purposes hereof, and Issuer shall be
entitled to rely thereon.
7. LIMITATION ON LIABILITY. Specifically, but without limitation,
Issuer shall not be responsible to Applicant for, and Issuer's
rights and remedies against Applicant shall not be impaired by:
(a) Insert Rider 5 from Exhibit A attached hereto.
(i) the New York Uniform Commercial Code or the Uniform
Customs and Practice for Documentary Credits (1993
Revision), International Chamber of Commerce Publication
No. 500 (the "Uniform Customs"),
(ii) the law or published practice rules to which the
Credit is subject,
(iii) an applicable standard practice of banks that
regularly issue letters of credit,
(iv) an applicable order, ruling, or regulation of any
court, arbitrator, or government agency,
(v) a published statement or interpretation on a matter of
applicable standard bank practice, or
(vi) an opinion received from Issuers legal counsel on a
matter of law or from an expert engaged by Issuer ' on a
matter of practice,
(b) Honor of any presentation that substantially or
reasonably complies with the terms and conditions of the
Credit, even if the Credit requires strict colateral
compliance by the beneficiary,
(c) Honor of a nonnegotiable or informal or unmarked demand
or of a demand by the beneficiary presented
electronically, even if the Credit requires that the
beneficiary's demand be in the form of a draft and states
that it is drawn under the Credit,
(d) Honor of documents signed or presented by or on behalf of,
or requesting payment to, the beneficiary's purported
successor by operation of law,
(e) Honor of a presentation without regard to any non-
documentary condition(s) in the Credit,
(f) Honor or other recognition of a presentation or
other demand that later is determined to have included
forged or fraudulent documents or that was otherwise
affected by the fraudulent, bad faith, or illegal conduct
of the beneficiary or other person (excluding Issuer's
employees), including payment to a person who later is
determined to have forged the signature of a beneficiary,
nominated bank, or assignee of letter of credit proceeds,
(g) Honor of a presentation up to the amount available
under the Credit against a draft or other documents
claiming amount(s) in excess of the amount available,
(h) Reimbursement of a nominated bank that does not give
value or that misrepresents the basis on which it claims
reimbursement, or
(i) Dishonor of any presentation that does not strictly
comply or that is fraudulent, forged, or otherwise not
entitled to honor.
8. SECURITY INTEREST. As security for the prompt and
unconditional payment of all obligations and liabilities of
Applicant to Issuer and all Issuer's claims against Applicant,
whether arising or incurred under this Agreement or otherwise,
whether now existing or hereafter incurred, and whether now or
hereafter owing to or acquired in any manner by Issuer
("Obligations"), Applicant hereby grants to Issuer a first
priority security interest in Applicant's present and future
rights in Insert Rider 3 from Exhibit A attached hereto.
Applicant agrees to sign and/or deliver to Issuer, upon Issuer's
request, such security agreements, mortgages, deeds of trust,
assignments, documents, instruments or financing statements as
Issuer may require to perfect, register or record a security
interest in any item of Collateral or to foreclose upon any such
item and to reimburse Issuer for all costs relating thereto.
Issuer may, at its option, require Applicant to provide
additional security for the Obligations, whether caused by a
decline in the value of the existing Collateral or any other
reason. The Obligations of Applicant are secured by all
Collateral provided for under this Agreement as well as any
additional security furnished to Issuer now or hereafter pursuant
to any and all security agreements, mortgages, and assignments
executed by Applicant in favor of Issuer.
Upon the occurrence of any Event of Default, as hereinafter
defined, Issuer may, upon ten calendar days' prior written notice
where notice is required by law, Sell or in any other way collect
or realize upon any part of the Collateral. Any such sale may be
public or private and at any such sale Issuer may be the
purchaser of the property sold. Applicant shall remain liable to
Issuer for any deficiency of the net proceeds in meeting the
Obligations. Applicant further agrees to reimburse Issuer for all
expenses (including attorneys' fees) incurred by Issuer in
selling or otherwise realizing upon or attempting to sell or
realize upon any item of Collateral.
For purposes of this Section 8, the term "Issuer" shall include
Issuer and any Banc One Affiliate.
9. COMPLIANCE WITH LAWS. Applicant agrees to comply with all
applicable foreign and domestic laws and regulations with respect
to the transaction covered by the Credit.
10. POWER OF ATTORNEY. Applicant irrevocably appoints Issuer its
attorney in fact to execute, in the name of Applicant,
assignments, endorsements or other instruments or documents of
any kind or description coming into the possession of Issuer
under a Credit or instructions of Applicatn, to execute, file,
register or record any document or instrument and to do such
other acts as Applicant may be required to do hereunder, upon
failure of Applicant to so act.
11. EVENTS OF DEFAULT. If any one or more of the following Events
of Default shall occur;
(a) Applicant fails to comply with any of the provisions
of this Agreement or of any security documents referred
to in Section 8; or
(b) Applicant dies, ceases to exist, becomes insolvent or is
the subject of bankruptcy or insolvency proceedings; or
(c) Any representation by Applicant in the Agreement or
otherwise, made to induce Issuer to issue the Credit, is
incorrect in any material respect when made; or
(d) Applicant defaults in any other obligation owing to Issuer
or to any Banc One Affiliate; or
(e) Any other event occurs which causes Issuer, in good faith,
to deem itself insecure;
then, all of the Obligations shall, at Issuer's option and
without notice or demand, mature and become immediately due and
payable, with interest at the per annum rate which is three
percentage points in excess of the Base Rate as herein defined
(provided such interest rate does not exceed the maximum rate
of interest which may be charged under applicable law), and
Issuer shall have all rights and remedies for default provided
in the security documents described in Section 8, as well as
applicable law.
12. INDEMNITY. Applicant hereby agrees to indemnify Issuer and
its officers, employees, agents and correspondents against any
loss, cost, damage, expense (including any reasonable charges for
legal services), and/or liability whatsoever which they, or any
of them, may sustain or incur on account of Issuance of the
Credit, payment or acceptance of any draft relative thereto,
refusal or failure to pay or accept any such draft, any action or
inaction respecting the Credit. instructions of Applicant or an
accommodated party, drafts, documents or merchandise relative to
the Credit or any action or inaction in reliance on the
provisions hereof; except that, Applicant shall have a claim
against Issuer, and Issuer shall be liable to Applicant, to the
extent, but only to the extent of any direct, as opposed to
consequential, damages suffered by Applicant which Applicant
proves were caused by
(a) issuer's willful misconduct or gross negligence in
determining whether documents presented under a Credit
comply with the terms of the Credit, or
(b) Issuer's willful failure to pay under the Credit after the
presentation to it by the beneficiary of the Credit of a
draft and documentation strictly corn with the terms and
conditions of the Credit.
13. CROSSED OUT
14. WAIVER. TO THE EXTENT THE PREVIOUS SECTION DOES NOT RESTRICT
A PARTY'S XXXXX XX TO EMPLOY JUDICIAL REMEDIES. ISSUER,
APPLICANT, CORRESPONDENT AND EACH GUARANTOR VOLUNTARILY.
IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE, BETWEEN THE PARTIES ARISING OUT OF,
IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO A CREDIT. THIS
APPLICATION ANDIOR ANY DOCUMENT EVIDENCING AND/OR SECURING A
CREDIT OR THIS AGREEMENT. THIS PROVISION IS A MATERIAL INDUCEMENT
TO ISSUER AGREEING TO ENTER INTO THIS AGREEMENT AND ISSUE CREDITS
HEREUNDER.
15. LIMITATION OF INTEREST AND OTHER CHARGES. Applicant and
Issuer intend to conform strictly to the applicable usury laws
now or hereafter in force with respect to this Agreement. To such
end:
(a) the aggregate of all interest and other charges
constituting interest under such applicable usury laws
and contracted for, chargeable or receivable under this
Agreement shall never exceed the maximum amount of
interest, nor produce a rate in excess of the maximum
contract rate of Interest, that Issuer is authorized to
charge Applicant under such applicable usury laws;
(b) if any excess interest is provided for, it shall be
deemed a mistake, and the excess shall, at the option of
Issuer, either be refunded to Applicant or credited on
the unpaid principal balance of Issuer's reimbursement
obligation, and this Agreement shall be automatically
reformed to permit only the collection of the maximum
legal contract rate and the maximum amount of interest,
and
(c) in determining the maximum amount of interest that
Issuer may charge to Applicant, all interest shall be
amortized, prorated, allocated and spread over the entire
term of Applicant's reimbursement obligation (as
extended, if applicable) to the full extent permitted by
applicable usury laws. Reference herein to usury laws
shall also include any applicable federal or state usury
statutes or laws from time to time in effect to the
extent the same may govern and control transactions
covered hereunder.
16. CROSSED OUT.
17. CROSSED OUT.
18. NONWAIVER. Issuer shall have no duty to exercise any rights
hereunder or otherwise with respect to any documents or
instruments relative to the Credit and shall not be liable for
any failure or delay in doing so. Issuer shall not be deemed to
have waived any of its rights hereunder unless Issuer shall have
signed such waiver in writing.
19. NOTICES AND COMMUNCIATIONS. Any notice or demand to either
party given by the other party shall be deemed to have been
delivered when deposited in the mail or transmitted by a
telegraph, telex or facsimile to the last address of such party
which has previously been furnished to such other party.
Applicant acknowledges and agrees that, at the discretion of
Issuer, Issuer may accept and/or transmit notices and
communciaiton under the Application and this Agreement (including
issuance of the Credit) by means of SWIFT, electronic mail,
telex, twx, telecopy, telefax or computer generated
telecommunications.
20. MISCELLANEOUS.
(a) If this Agreement is signed by more than one party,
Applicant' shall be deemed to refer to all of the under
resigned, all Obligations of Applicant hereunder shall
be joint and several and the liabilities of each shall be
absolute and unconditional. regardless of the liability
of any other party hereto.
(b) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Except as otherwise expressly provided herein or in the
Credit, Issuer may rely for Interpretation of the Credit
or Instructions or documents related thereto or issued
under or in purported compliance with the above, on the
Uniform Customs.
(c) The invalidity or unenforceability of any provision
or portion of this Agreement or any instrument, document.
or agreement executed or made pursuant to or by virtue of
this Agreement, shall not affect the validity or
enforceability of any other provision or portion.
(d) This Agreement may only be amended upon the written
consent of all the parties hereto.
(e) This Agreement confers no right or benefit upon any
person other than the parties to this Agreement and their
respective successors and assigns.
(f) Applicant agrees that in the event of any extension
of the maturity or time for presentation of drafts,
acceptances or documents, or any other modification of
the terms of the Credit, or in the event of any increase
in the amount of the Credit, this Agreement shall be
binding upon Applicant with regard to the Credit so
increased or otherwise modified, to drafts, documents and
property covered thereby, and to any action taken by
Issuer or any of its correspondents in accordance with
such extension, increase or other modification.
21. DURATION AND EFFECT OF AGREEMENT. This Agreement shall remain
in full force and effect until such time as Applicant has
discharged in full its go ons hereunder Notwithstanding the
foregoing sentence, if the Credit is issued in favor of a
sovereign or commercial entity which Is to Issue a guarantee or
undertaking on Applicant's behalf in connection therewith, the
Applicant shall remain liable on the Credit until Issuer Is fully
released in writing by such entity. This Agreement shall be
binding upon Applicant, its successors and assigns and shall
inure to the benefit of Issuer, Its successors and assigns.
Issuer may grant participations in this Agreement and the
Credit issued hereunder to one or more financial Institutions.
22. EFFECT OF OTHER AGREEMENT. If Applicant is a party to another
financial agreement with the Issuer or any Banc One Affiliates,
and such other financial agreement provides for the issuance of
standby letters of credit on behalf of Applicant, then the
provisions of such other financial agreement as they relate to
letters of credit shall prevail over any inconsistent provisions
of this Agreement.
23. BANC ONE AFFILIATES. Applicant hereby authorizes and consents
to the issuance of Credits her . xxxxxx by any Banc One Affiliate
acting at the direction of the Issuer. In such event, once the
Issuer has funded draws under any such Credit, it shall have the
right, remedies security Interests and
other liens provided herein to Issuer, and Applicant shall be
obligated to make the payments due Issuer herein as if the Issuer
had issued the Credit.
EXCEPT AS PROVIDED FOR HEREIN, THIS WRITTEN AGREEMENT REPRESENTS
THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO ITS
SUBJECT MATTER AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
THIS AGREEMENT IS SUPPORTED BY OTHER SECURITY DOCUMENTS. IF
OTHER SECURITY DOCUMENTS, INDICATE TYPE OF COLLATERAL: Insert
Rider 4 from Exhibit A attached hereto.
APPLICANT:
R & B FALCON CORPORATION
Printed Name of Applicant
By:
-----------------------
Authorized Signataure - Title
By: Executive Vice President and
Chief Financial Officer
-----------------------
Authorized Signature - Title
I/We Authorize you to debit for payment and charges
Account Number:
BANK ONE LOUISIANA, N.A.
By:
Name (Please Print):
Title:
Officer's Number:
Officer's Cost Center:
Branch Name:
Phone Number:
EXHIBIT "A"
Attached to and Forming a Part of
Application and Agreement for
Irrevocable Standby Letter of Credit
dated August 30, 1999 between
Bank One Louisiana. N.A.
and R&B Falcon Corporaiton
Rider 1:
Wilmington Trust Company,
not in its individual capacity but solely as
Charter Trustee under Charter Trust Agreement
(Deepwater Charter Trust 1999-A)
dated as of August 31, 1999
Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention Corporate Trust Administration
Rider 2:
(d) Applicant shall pay to Issuer a letter of credit fee at the
rate of 0. 15% per annum (calculated for the actual number
of days elapsed on the basis of a year consisting of 360
days) on the average daily undrawn amount of the Credit,
such fee to be payable in arrears on the last day of each
March, June, September and December hereafter and on
the date on which the Credit is terminated or expires in
accordance with its terms.
Rider 3:
the account and other Collateral covered by that certain Pledge
Agreement dated as of August 30, 1999 between Applicant and
Issuer.
Rider 4:
Pledge Agreement dated as of August 30, 1999 between Applicant
and Issuer
Rider 5:
(a) actions which Issuer takes, or any inaction by Issuer,
pursuant to or in accordance with:
EXHIBIT "B"
Attached to and Forming a Part of
Application and Agreement for
Irrevocable Standby Letter of Credit
dated August 30, 1999 between
Bank One Louisiana, NA
and R&B Falcon Corporation
FORM OF LETTER OF CREDIT TO BE ISSUED
BANK ONE, LOUISIANA, NATIONAL ASSOCIATION
TIN 00-0000000
0000 XXXX XXXXXX, 00 XX XXXXX
XXXXXX, XXXXX 00000
TELEPHONE: 0-000-000-0000
TRANSFERABLE IRREVOCABLE
STANDBY LETTER OF CREDIT NO.
DATE OF ISSUE: DATE AND PLACE OF EXPIRY:
AUGUST 30,1999 APRIL 28, 2004, IN DALLAS, TEXAS
APPLICANT: AMOUNT:
R&B FALCON CORPORATION FIFTY MILLION DOLLARS ($50,000,000)
TIN 00-0000000
000 Xxxxxxxxxxxx
Xxxxxxx, Xxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
BENEFICIARY:
WILMINGTON TRUST COMPANY,
not in its individual capacity but solely as
Charter Trustee under Charter Trust Agreement
(Deepwater Charter Trust 1999-A)
dated as of August 31, 1999
I 000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
Tel: (000) 000-0000
Fax: (000) 000-0000
Ladies and Gentlemen:
At the request, on the instructions and for the account of
R&B Falcon Corporation (the "Applicant"), Bank One, Louisiana,
National Association hereby establishes its Transferable
Irrevocable Standby Letter of Credit No. ___________________
("Letter of Credit") in favor of Wilmington Trust Company, not
in its individual capacity but solely as Charter Trustee under
Charter Trust Agreement (Deepwater Charter Trust 1999-A) dated as
of August 31, 1999 (the "Charter Trust Agreement") among the
persons from time to time party thereto as Beneficial Owners,
Wilmington Trust Company, not in its individual capacity except as
expressly stated therein, but solely as Charter Trustee, and
Deepwater Investment Trust 1999-A, a Delaware business trust, or
any successor trustee under the Charter Trust Agreement to whom
this Transferable Irrevocable Standby Letter of Credit shall have
been transferred in accordance with the terms hereof (the
"Beneficiary"), in the aggregate amount not exceeding Fifty
Million Dollars ($50,000,000), effective immediately and expiring
on April 28, 2004 unless terminated earlier in accordance with the
provisions hereof. The amount of this Letter of Credit shall be
available by the Beneficiary's draft on us in accordance with the
terms and conditions hereinafter set forth.
Partial draws are not permitted.
Subject to the foregoing and the further provisions of this Letter
of Credit, a single demand for payment may be made by the
Beneficiary by presentation to Bank One, Texas, N.A., National
Standby Letter of Credit Department, at 0000 Xxxx Xxxxxx, I Ith
Xxxxx, Xxxxxx, Xxxxx 00000, of the original of the Beneficiary's
manually signed sight draft drawn under this Letter of Credit in
the form of Annex A attached hereto (which Annex A forms an
integral part of this Letter of Credit), and accompanied by the
original of this Letter of Credit and the original of the
Beneficiary's manually signed drawing certificate in the form of
Annex B attached hereto (which Annex B forms an integral part of
this Letter of Credit).
Such sight draft and certificate shall have all blanks
appropriately filled in and shall be signed by a person purporting
to be one of the Beneficiary's Vice Presidents, Assistant Vice
Presidents, Trust Officers, Assistant Trust Officers or Authorized
Representatives (each an "Authorized Officer"), and such sight
draft and certificate may be in the form of a letter on the
Beneficiary's letterhead.
Demand for payment may be made by the Beneficiary under this Letter
of Credit prior to the expiration hereof at any time during the
regular business hours of Bank One, Texas, N.A. at its address set
forth above on any Business Day. As used herein the term "Business
Day" means (a) a day on which Bank One, Texas, N.A. (at its above
address) is open for the purpose of conducting a commercial banking
business, and (b) a day on which banking institutions in the States
of Louisiana and Texas generally are open for the purpose of
conducting a commercial banking business. If demand for payment is
made by the Beneficiary hereunder at or prior to 3:00 p.m., Dallas,
Texas time, on a Business Day, and provided that such demand for
payment and the documents presented in connection therewith conform
to the terms and conditions hereof, payment shall be made to the
Beneficiary of the amount demanded, in immediately available funds,
not later than 3:00 P.M., Dallas, Texas time, on the next
succeeding Business Day, and if demand for payment is made by the
Beneficiary hereunder after 3:00 p.m., Dallas, Texas time, on a
Business Day, and provided that such demand for payment and the
documents presented in connection therewith conform to the terms
and conditions hereof, payment shall be made to the Beneficiary
of the amount demanded, in immediately available funds, not later
than 3:00 p.m., Dallas, Texas time, on the second succeeding
Business Day.
Payment under this Letter of Credit may be made by wire transfer
of immediately available funds to any account maintained by the
Beneficiary at any bank that participates in the Federal Reserve
wire system.
This Letter of Credit shall terminate at 5:00 P.M. (Dallas, Texas
time) on the date that is the earliest of (i) the honoring by us
of the drawing available to be made hereunder, (ii) the date on
which this Letter of Credit is surrendered by the Beneficiary to
us for cancellation, and (iii) April 28, 2004.
If a demand for payment does not conform to the terms and
conditions of this Letter of Credit, we will notify the
Beneficiary thereof within a reasonable time after such delivery
of such demand for payment, but in any event within three (3)
Business Days after such delivery, such notice to be promptly
confirmed in writing, and we shall hold all documents at the
Beneficiary's disposal or return the same to the Beneficiary.
Only you, as Beneficiary, in your capacity as holder hereof on
behalf of the Certificate Purchasers (as such term is defined in
the Participation Agreement dated as of August 31, 1999, among the
Beneficiary, the Applicant and others), may make a drawing under
this Letter of Credit. Upon the payment to the Beneficiary or the
Beneficiary's account of the amount specified in a sight draft
drawn hereunder, we shall be fully discharged on our obligation
under this Letter of Credit with respect to such draft, and we
shall not thereafter be obligated to make any further payments
under this Letter of Credit in respect of such draft to the
Beneficiary or to any other person, firm, corporation or other
entity who may have made to the Beneficiary or who subsequently
makes to the Beneficiary a demand for payment.
Notwithstanding anything to the contrary in Article 48 of the UCP,
this Letter of Credit is transferable in its entirety (but not in
part) to any transferee who has succeeded you as Charter Trustee
under the Charter Trust Agreement and may be successively
transferred. Transfer of this Letter of Credit to such a
transferee shall be effected by the presentation to us of this
Letter of Credit accompanied by a certificate substantially in the
form of Annex C attached hereto (which Annex C forms an integral
part of this Letter of Credit) purportedly signed by an Authorized
Officer. Upon receipt of the foregoing, we shall affix an
appropriate endorsement to this Letter of Credit reflecting the
transfer and issue an amendment to this Letter of Credit to such
successor Charter Trustee.
This Letter of Credit shall be subject to the Uniform Customs and
Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 (the "UCP"). As to matters
not governed by the UCP, this Letter of Credit shall be governed
by, and construed and enforced in accordance with, the laws of the
State of New York.
All notices and other communications to us in respect of this
Letter of Credit (other than documents presented to us in
connection with your demand for payment which shall be presented
as provided in this Letter of Credit), shall be in writing and
addressed and presented to us at the address set forth in this
Letter of Credit, in each case specifically referring to the
number of this Letter of Credit.
This Letter of Credit sets forth in full our undertaking, and
such undertaking shall not in any way be modified, amended,
amplified or limited by reference to any document, instrument or
agreement referred to herein except only the Annexes hereto; and
any such reference shall not be deemed to incorporate herein by
reference any document instrument or agreement except as set
forth above.
Very truly yours,
BANK ONE, LOUISIANA, NATIONAL ASSOCIATION
By:___________________
Title:________________
Name:_________________
ANNEX A
to Letter of Credit
FORM OF SIGHT DRAFT
[Date]
Pay to the account of_________, not in its individual capacity
but solely as Charter Trustee under Charter Trust Agreement (Deepwater
Charter Trust 1999-A) dated as of August 31, 1999,Dollars ($[amount]),
drawn under Bank One, Louisiana, National Association, Transferable
Irrevocable Standby Letter of Credit No.____________.
Bank One, Louisiana, National Association ___________________________,
x/x Xxxx Xxx, Xxxxx, N.A. not in its individual capacity
National Standby Letter of Credit Department but solely as Charter Trustee
0000 Xxxx Xxxxxx, 00xx Xxxxx under Charter Trust Agreement
Xxxxxx, Xxxxx 00000 (Deepwater Charter Trust 1999-A)
dated as pf August 31, 1999
By:___________________
Title:________________
Name:_________________
ANNEX B
to Letter of Credit
FORM OF
CERTIFICATE FOR DRAWING
[Date]
Bank One, Louisiana, National Association
x/x Xxxx Xxx, Xxxxx, N.A.
National Standby Letter of Credit Department
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Dear Sir or Madam:
The undersigned, an Authorized Officer of , not
in its individual capacity but solely as Charter Trustee under
Charter Trust Agreement (Deepwater Charter Trust 1999-A) dated as
of August 31, 1999, as Beneficiary (the "Beneficiary"), hereby
certifies to Bank One, Louisiana, National Association (the
"Issuing Bank"), with reference to Transferable Irrevocable
Standby Letter of Credit No. (the "Letter of Credit",
any capitalized term used herein and not defined shall have its
respective meaning as set forth in the letter of Credit) issued
by the Issuing Bank in favor of the Beneficiary that:
1. The undersigned is the Charter Trustee or a successor
Charter Trustee under the Charter Trust Agreement;
2. The Beneficiary is the beneficiary under the R&B Falcon
Drilling Contract Guaranty (as defined in Appendix 1 to the
Participation Agreement referred to in the Charter Trust
Agreement) and a beneficiary under the R&B Falcon Guaranty (as
defined in Appendix 1 to the Participation Agreement referred to
in the Charter Trust Agreement);
3. The Beneficiary has made a demand (a copy of which is
attached hereto, together with proof of delivery), under the R&B
Falcon Drilling Contract Guaranty and/or the R&B Falcon Guaranty;
which demand has not been satisfied in full within five (5)
Business Days of the receipt thereof; and
4. All funds drawn under the Letter of Credit shall be
transferred by you in the form of wire transfer to:
Bank: __________________________
ABA Number:______________________
Account Number:__________________
Reference:_______________________
IN WITNESS WHEREOF, the Beneficiary has executed and deliered
this Certificate as of the {_____} day of [month], [year].
________________________,
not in its individual capacity but
solely as Charter Trustee under Charter
Trust Agreement (Deepwater Charter
Trust 1999-A) dated as of August 31, 1999
By:_______________________
Title:____________________
Name:_____________________
ANNEX C
to Letter of Credit
FORM OF
TRANSFER CERTIFICATE
[Date]
Bank One, Louisiana, National Association
x/x Xxxx Xxx, Xxxxx, N.A.
National Standby Letter of Credit Department
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Dear Sir or Madam:
We refer to Transferable Irrevocable Standby Letter of
Credit No._________________ (the "Letter of Credit") issued by Bank
One, Louisiana, National Association in favor of________________,
not in its individual capacity but solely as Charter Trustee under
Charter Trust Agreement (Deepwater Charter Trust 1999-A) dated as
of August 31, 1999 (the "Charter Trust Agreement") among the persons
from time to time party thereto as Beneficial Owners, Wilmington
Trust Company, not in its individual capacity except as expressly
stated therein, but solely as Charter Trustee, and Deepwater
Investment Trust 1999-A, a Delaware business trust.
For value received we hereby irrevocably transfer to__________
(hereinafter referred to as the "Transferee") all rights of the
undersigned to draw under the Letter of Credit in its entirety.
By this transfer, all rights of the undersigned in the
Letter of Credit are transferred to the Transferee and the
Transferee shall have the sole rights relating to any amendments
whether increases or extensions or other amendments and whether
now existing or hereafter made. All amendments are ot be advised
to the Transferee without necessity of any consent of or notice
to the undersigned.
The Letter of Credit is returned herewith for endorsement
and delivery to the Transferee.
Very truly yours,
___________________________
By:_____________________
Title:__________________
Name:___________________
SIGNATURE AUTHENTICATED
_______________________
(Bank)
_______________________
(Authorized Signature)
