EXHIBIT 10.3
SERVICES AGREEMENT
AGREEMENT, dated as of October 16, 1995 (this "Agreement"), by
and between Loews Corporation, a Delaware corporation ("Loews"), and Diamond
Offshore Drilling, Inc., a Delaware corporation ("Diamond Offshore").
WITNESSETH:
WHEREAS, Diamond Offshore (which term, as used in this
Agreement, shall include Diamond Offshore and its subsidiaries unless the
context otherwise requires) is a subsidiary of Loews;
WHEREAS, Loews performs certain administrative, technical and
ministerial services in connection with the operation of its business
(hereinafter referred to collectively as "Staff Services");
WHEREAS, greater efficiency and reduced costs result from the
economies of scale associated with the provision of certain Staff Services by
Loews for itself, Diamond Offshore and Loews's other subsidiaries;
WHEREAS, Loews is experienced in the provision of Staff
Services for its subsidiaries and third parties, and, by virtue of its
purchasing power, is able to obtain discounts from certain suppliers of goods
and services;
WHEREAS, Loews has, from time to time, provided such Staff
Services to Diamond Offshore pursuant to that certain Services Agreement, dated
as of July 1, 1992, by and between Loews and Diamond Offshore (the "1992
Services Agreement");
WHEREAS, Diamond Offshore desires to continue to avail itself
of such services, and Loews desires to continue to provide such services
pursuant to this Agreement, which amends, restates and supersedes the 1992
Services Agreement in its entirety;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and affirmed, the
parties hereto agree as follows:
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SECTION 1. Services Provided By Loews.
Loews shall provide or cause to be provided to Diamond
Offshore, as requested by Diamond Offshore, the following Staff Services in
connection with the operations of Diamond Offshore:
(a) Personnel Services. Loews's Personnel Department shall
assist Diamond Offshore with respect to the hiring, training and discharge of
employees of Diamond Offshore, the establishment of personnel policies and
practices and salary administration, negotiation with labor unions, if any, and
the administration of employee benefits provided by Diamond Offshore, as the
parties hereto may from time to time agree.
(b) Telecommunications. Loews shall assist Diamond Offshore in
the acquisition, maintenance and management of telecommunications equipment and
services, as the parties hereto may from time to time agree.
(c) Purchasing Services. Loews's Purchasing Department shall,
from time to time, as the parties hereto may agree in individual circumstances,
assist Diamond Offshore in the purchase of certain goods and services for
Diamond Offshore.
(d) Accounting Services. Loews's Accounting Department shall
assist Diamond Offshore's Accounting Department and provide general and specific
accounting services including services in relation to financial reporting as the
parties hereto may from time to time agree.
(e) Data Processing Services. Loews's MIS Department shall (i)
assist Diamond Offshore in the establishing, maintaining and developing computer
systems which Diamond Offshore shall maintain for its operations and (ii)
provide access to Loews's centralized data processing services and facilities,
where appropriate, as the parties hereto may from time to time agree.
(f) Cash Management Services. Loews's Treasurer's Department
shall, as the parties hereto may from time to time agree, assist Diamond
Offshore with respect to the collection, holding and disbursement of cash
receipts of Diamond Offshore, all of which shall ultimately be under the control
and for the benefit of Diamond Offshore.
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(g) Tax Preparation. Loews shall advise and assist Diamond
Offshore in preparing and filing foreign, federal, state and other tax returns,
handling discussions and proceedings with tax authorities, and planning with
respect to tax liabilities, as the parties hereto may from time to time agree.
(h) Insurance. Loews's Insurance Department shall assist
Diamond Offshore in obtaining insurance and administering claims thereunder, as
the parties hereto may from time to time agree.
(i) Real Estate Management. Loews's Real Estate Department
shall, as the parties hereto may from time to time agree, assist Diamond
Offshore in purchasing and selling real property, leasing and administering
leased properties and handling tax proceedings concerning such properties.
(j) Internal Audit. Loews's Internal Audit Department shall,
as the parties hereto may from time to time agree, provide internal audit
services to Diamond Offshore.
(k) Miscellaneous. Loews shall provide other miscellaneous
Staff Services to Diamond Offshore, as the parties hereto may from time to time
agree.
SECTION 2. Relationship of the Parties.
(a) Each party acknowledges that the services provided
hereunder by Loews are intended to be administrative, technical or ministerial
and are not intended to set policy for Diamond Offshore. Each party shall
continue to set corporate policy independently through its own Board of
Directors.
(b) In all activities under this Agreement, each party shall
be an independent contractor, except as may be otherwise specifically provided
in writing and authorized by the appropriate Board of Directors. Nothing in this
Agreement shall be deemed to (i) make either party or any employee of such party
the agent, employee, joint venturer or partner of the other party or (ii) create
in either party the right or authority to incur any obligation or contract for
any services from third parties on behalf of the other party or to bind such
other party in any way whatsoever except as may be expressly provided in this
Agreement.
(c) Loews shall have no liability for any act or omission in
connection with this Agreement other than repeating a service for the purpose of
correcting an act or omission where reasonable and appropriate
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under the circumstances. Neither party shall be liable to the other party in
respect of an act or omission in connection with this Agreement, for loss of
profits, good will or any other general, indirect, special or consequential
damages of any kind. Except as expressly set forth in this Section 2, Loews
makes no representations or warranties with respect to the services to be
provided under this Agreement.
(d) Diamond Offshore hereby agrees to defend, indemnify and
save Loews and its affiliates (other than Diamond Offshore and its
subsidiaries), officers, directors, employees and agents harmless from and
against any and all loss, claim, damage, liability, cost or expense, including
reasonable attorneys' fees, incurred by Loews or any such affiliates based upon
a claim by or liability to a third party arising out of the Staff Services to be
provided by Loews hereunder, unless due to the gross negligence or wilful
misconduct of Loews or its affiliates.
SECTION 3. Fee, Costs and Expenses.
Costs and expenses incurred by Loews in providing the Staff
Services to Diamond Offshore shall be allocated as follows or as the parties may
otherwise agree:
(a) Diamond Offshore shall reimburse Loews for the Staff
Services received by it in an amount not to exceed the allocated personnel costs
(i.e., wages, salaries, employee benefits and payroll taxes) of the Loews's
personnel actually providing such services.
(b) All out-of-pocket costs for goods and services in relation
to Staff Services shall be borne by Diamond Offshore.
SECTION 4. Term.
This Agreement may be terminated by Diamond Offshore at any
time on not less than 30 days' prior written notice to Loews. This Agreement may
be terminated by Loews at any time on not less than six months' prior written
notice to Diamond Offshore.
SECTION 5. Notices.
All notices, consents and other communications hereunder shall
be in writing and shall be deemed given hereunder when sent by certified mail,
return receipt requested, or delivered by hand to the parties at the
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following addresses, or at any other address as either party may, from time to
time, specify by notice to the other:
If to Loews:
Loews Corporation
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Secretary
If to Diamond Offshore:
Diamond Offshore Drilling, Inc.
X.X. Xxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
SECTION 6. Miscellaneous.
This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New York. The headings of this
Agreement are for ease of reference and do not limit or otherwise affect the
meaning hereof. Neither party may assign any of its rights or obligations under
this Agreement without the express written consent of the other party. This
Agreement amends, restates and supersedes the 1992 Services Agreement in its
entirety.
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IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first above written.
LOEWS CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
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Title: Senior Vice President
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DIAMOND OFFSHORE DRILLING, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxxx
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Title: Vice President
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