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EXHIBIT 10.2
Execution Copy
$805,000,000 AT MATURITY
DIAMOND OFFSHORE DRILLING, INC.
ZERO COUPON CONVERTIBLE DEBENTURES DUE JUNE 6, 2020
REGISTRATION RIGHTS AGREEMENT
June 6, 2000
Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
Diamond Offshore Drilling, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to Credit Suisse First Boston Corporation (the
"Initial Purchaser"), and the Initial Purchaser proposes to purchase and accept
from the Company, upon the terms set forth in a purchase agreement of even date
herewith (the "Purchase Agreement"), $805,000,000 aggregate principal amount at
maturity of its Zero Coupon Convertible Debentures due June 6, 2020 (the
"Debentures"). The Debentures will be issued pursuant to a Second Supplemental
Indenture, dated as of June 6, 2000, which supplements the Indenture dated
February 4, 1997 (taken together, the "Indenture") by and between the Company
and The Chase Manhattan Bank (the "Trustee"). Under the terms of the Indenture,
the Debentures are convertible, in whole or in part, into shares of Common
Stock, par value $.01 per share (the "Conversion Shares" and, together with the
Debentures, the "Securities"), at the option of the holders thereof at any time
following the date of original issuance thereof at the Conversion Rate (as
defined in the Indenture) set forth in the Debentures, as adjusted from time to
time pursuant to the Indenture. As an inducement to the Initial Purchaser, the
Company agrees with the Initial Purchaser, for the benefit of the holders of the
Debentures (including, without limitation, the Initial Purchaser) and Conversion
Shares (collectively, the "Holders"), as follows:
1. Resale Shelf Registration. (a) The Company shall, at its cost, use its
reasonable best efforts to file as promptly as practicable (but in no event more
than 90 days after the Closing Date (as defined in the Purchase Agreement)) with
the Securities and Exchange Commission (the "Commission") and thereafter shall
use its reasonable best efforts to cause to be declared effective no later than
180 days after the Closing Date a registration statement (the "Resale Shelf
Registration Statement") on an appropriate form under the Securities Act of
1933, as amended (the "Securities Act") relating to the offer and sale of the
Transfer Restricted Securities (as defined in Section 5 hereof) by the Holders
thereof from time to time in accordance with the methods of distribution set
forth in the Resale Shelf Registration Statement and Rule 415 under the
Securities Act (hereinafter, the "Resale Shelf Registration"); provided,
however, that no Holder (other than the Initial Purchaser) shall be entitled to
have the Securities held by it covered by such Resale Shelf Registration
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Statement unless such Holder agrees in writing to be bound by all the provisions
of this Agreement applicable to such Holder.
(b) The Company shall use its reasonable best efforts to keep the
Resale Shelf Registration Statement continuously effective in order to permit
the prospectus included therein to be lawfully delivered by the Holders of the
relevant Securities, for a period of two years from the date of its
effectiveness or such shorter period that will terminate when all the Securities
covered by the Resale Shelf Registration Statement (i) have been sold pursuant
thereto or (ii) are no longer Transfer Restricted Securities as defined in
Section 5(d) (in any such case, such period being called the "Shelf Registration
Period"). The Company shall be deemed not to have used its reasonable best
efforts to keep the Resale Shelf Registration Statement effective during the
requisite period if it voluntarily takes any action (other than as contemplated
by Section 2(h)) that would result in Holders of Securities covered thereby not
being able to offer and sell such Securities during that period, unless such
action is required by applicable law.
(c) Notwithstanding any other provisions of this Agreement to the
contrary, the Company shall cause the Resale Shelf Registration Statement and
the related prospectus and any amendment or supplement thereto, as of the
effective date of the Resale Shelf Registration Statement, amendment or
supplement, (i) to comply in all material respects with the applicable
requirements of the Securities Act and the rules and regulations of the
Commission and (ii) not to contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.
(d) Each Holder agrees that if such Holder wishes to sell such
Holder's Securities pursuant to a Resale Shelf Registration Statement and
related prospectus, it will do so in accordance with this Section 1(d). Each
Holder wishing to sell Securities pursuant to a Resale Shelf Registration
Statement and related prospectus agrees to deliver a Notice and Questionnaire
(the form of which is attached as Annex A to the Offering Memorandum and in
connection with the offering of the Debentures) to the Company prior to any
intended distribution of Securities under the Resale Shelf Registration
Statement. From and after the date the Resale Shelf Registration Statement is
declared effective, the Company shall, as promptly as is practicable after the
date a Notice and Questionnaire is delivered, and in any event within five (5)
Business Days after such date, (i) if required by applicable law, file with the
Commission a post-effective amendment to the Shelf Registration Statement or
prepare and, if required by applicable law, file a supplement to the related
prospectus or a supplement or amendment to any document incorporated therein by
reference or file any other required document so that the Holder delivering such
Notice and Questionnaire is named as a selling securityholder in the Resale
Shelf Registration Statement and the related prospectus in such a manner as to
permit such Holder to deliver such prospectus to purchasers of the Securities in
accordance with applicable law and, if the Company shall file a post-effective
amendment to the Resale Shelf Registration Statement, use all reasonable efforts
to cause such post-effective
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amendment to be declared effective under the Securities Act as promptly as is
practicable, but in any event by the date that is sixty (60) days after the date
such post-effective amendment is required by this clause to be filed; (ii)
provide such Holder copies of any documents filed pursuant to Section 1(d)(i);
and (iii) notify such Holder as promptly as practicable after the effectiveness
under the Securities Act of any post-effective amendment filed pursuant to
Section 1(d)(i); provided, that if such Notice and Questionnaire is delivered
during a period in which the use of the prospectus is suspended pursuant to
Section 2(h), the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the suspension period. Notwithstanding anything
contained herein to the contrary, the Company shall be under no obligation to
name any Holder that has not supplied the requisite information required by
Section 1(d) as a selling securityholder in any Registration Statement or
related Prospectus; provided, however, that any Holder that has subsequently
supplied the requisite information required by this Section 1(d) pursuant to the
provisions of this Section (whether or not such Holder has supplied the
requisite information required by this Section 1(d) at the time the Resale Shelf
Registration Statement was declared effective) shall be named as a selling
securityholder in the Resale Shelf Registration Statement or related prospectus
in accordance with the requirements of this Section 1(d).
2. Registration Procedures. In connection with the Resale Shelf
Registration contemplated by Section 1 hereof, the following provisions apply:
(a) The Company shall (i) furnish to the Initial Purchaser, prior to
the filing thereof with the Commission, a copy of the Resale Shelf Registration
Statement and each amendment thereof and each supplement, if any, to the
prospectus included therein and, in the event that the Initial Purchaser (with
respect to any portion of an unsold allotment from the original offering) is
participating in the Resale Shelf Registration, the Company shall use its
reasonable best efforts to reflect in each such document, when so filed with the
Commission, such comments as the Initial Purchaser reasonably may propose; and
(ii) include the names of the Holders, who propose to sell Securities pursuant
to the Resale Shelf Registration Statement, as selling securityholders.
(b) The Company shall give written notice to the Initial Purchaser and
Holders of the Securities (which notice pursuant to clauses (ii)-(v) hereof
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
(i) when the Resale Shelf Registration Statement or any amendment
thereto has been filed with the Commission and when the Resale Shelf
Registration Statement or any post-effective amendment thereto has
become effective;
(ii) of any request by the Commission for amendments or
supplements to the Resale Shelf Registration Statement or the
prospectus included therein or for additional information;
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(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Resale Shelf Registration
Statement or the initiation of any proceedings for that purpose;
(iv) of the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of
the Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and
(v) of the happening of any event (which need not be described
with any particular degree of specificity) that requires the Company
to make changes in the prospectus which forms a part of the Resale
Shelf Registration Statement in order that the prospectus does not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
(c) The Company shall make every reasonable effort to obtain the
withdrawal, at the earliest possible time, of any order suspending the
effectiveness of the Resale Shelf Registration Statement.
(d) The Company shall furnish to each Holder of Securities included
within the coverage of the Resale Shelf Registration, without charge, at least
one copy of the Resale Shelf Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if the
Holder so requests in writing, all exhibits thereto (including those, if any,
incorporated by reference).
(e) The Company shall, during the Resale Shelf Registration Period,
deliver to each Holder of Securities included within the coverage of the Resale
Shelf Registration, without charge, as many copies of the prospectus (including
each preliminary prospectus) included in the Resale Shelf Registration Statement
and any amendment or supplement thereto as such person may reasonably request.
The Company consents, subject to the provisions of this Agreement, to the use of
the prospectus or any amendment or supplement thereto by each of the selling
Holders of the Securities in connection with the offering and sale of the
Securities covered by the prospectus, or any amendment or supplement thereto,
included in the Resale Shelf Registration Statement in the manner described
therein.
(f) Prior to any public offering of the Securities, pursuant to any
Resale Shelf Registration Statement, the Company shall register or qualify or
cooperate with the Holders of the Securities included therein and their
respective counsel in connection with the registration or qualification of the
Securities for offer and sale under the securities or "blue sky" laws of such
states of the United States as any Holder of the Securities reasonably requests
in writing and do any and all other acts or things necessary or advisable to
enable the offer and sale in such jurisdictions of the
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Securities covered by such Resale Shelf Registration Statement; provided,
however, that the Company shall not be required to (i) qualify generally to do
business in any jurisdiction where it is not then so qualified or (ii) take any
action which would subject it to general service of process or to taxation in
any jurisdiction where it is not then so subject.
(g) The Company shall cooperate with the Holders of the Securities to
facilitate the timely preparation and delivery of certificates representing the
Securities to be sold pursuant to any Resale Shelf Registration Statement (to
the extent such Securities are certificated) free of any restrictive legends and
in such denominations and registered in such names as the Holders may request a
reasonable period of time prior to sales of the Securities pursuant to such
Resale Shelf Registration Statement.
(h) Upon the occurrence of any event contemplated by paragraphs (ii)
through (v) of Section 2(b) above during the Shelf Registration Period, the
Company shall promptly prepare and file a post-effective amendment to the Resale
Shelf Registration Statement or a supplement to the related prospectus and any
other required document so that, as thereafter delivered to Holders or
purchasers of Securities, the prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided however, that the Company may
delay preparing, filing and distributing any such supplement or amendment (and
continue the suspension of the use of the prospectus) if the Company determines
in good faith that such supplement or amendment would, in the reasonable
judgment of the Company, (i) interfere with or affect the negotiation or
completion of a transaction that is being contemplated by the Company (whether
or not a final decision has been made to undertake such transaction) or (ii)
involve initial or continuing disclosure obligations that are not in the best
interests of the Company's stockholders at such time; provided further, that
neither such delay nor such suspension shall extend for a period of more than 30
days in any three month period or more than 90 days for all such periods in any
twelve month period. If the Company notifies the Initial Purchaser and the
Holders of the Securities in accordance with paragraphs (ii) through (v) of
Section 2(b) above to suspend the use of the prospectus until the requisite
changes to the prospectus have been made, then the Initial Purchaser and the
Holders shall suspend use of such prospectus.
(i) Not later than the effective date of the Resale Shelf Registration
Statement, the Company will provide CUSIP numbers for the Debentures and the
Conversion Shares registered under the Resale Shelf Registration Statement and
provide the Trustee with a certificate for the Debentures, in a form eligible
for deposit with The Depository Trust Company.
(j) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the Resale Shelf
Registration and will make generally available to its security holders (or
otherwise provide in accordance with Section 11(a) of the Securities Act) an
earnings statement satisfying the provisions of Section 11(a) of the Securities
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Act, no later than 45 days after the end of a 12-month period (or 90 days, if
such period is a fiscal year) beginning with the first month of the Company's
first fiscal quarter commencing after the effective date of the Resale Shelf
Registration Statement, which statement shall cover such 12-month period.
(k) The Company shall cause the Indenture to be qualified under the
Trust Indenture Act of 1939, as amended, in a timely manner and containing such
changes, if any, as shall be necessary for such qualification. In the event that
such qualification would require the appointment of a new trustee under the
Indenture, the Company shall appoint a new trustee thereunder pursuant to the
applicable provisions of the Indenture.
(l) The Company shall enter into such customary agreements (including,
if requested an underwriting agreement in customary form) and take all such
other action, if any, as any Holder shall reasonably request in order to
facilitate the disposition of the Securities pursuant to any Resale Shelf
Registration.
(m) The Company shall (i) make reasonably available for inspection by
the Holders, any underwriter participating in any disposition pursuant to the
Resale Shelf Registration Statement and any attorney, accountant or other agent
retained by the Holders or any such underwriter all relevant financial and other
records, pertinent corporate documents and properties of the Company and (ii)
cause the Company's officers, directors, employees, accountants and auditors to
supply all relevant information reasonably requested by the Holders or any such
underwriter, attorney, accountant or agent in connection with the Resale Shelf
Registration Statement, in each case, as shall be reasonably necessary to enable
such persons, to conduct a reasonable investigation within the meaning of
Section 11 of the Securities Act; provided, however, that the foregoing
inspection and information gathering shall be coordinated on behalf of the
Initial Purchaser and the other parties, by one firm of counsel, which firm
shall be Xxxxxxx & Xxxxx L.L.P. until another firm shall be designated as
described in Section 3 hereof; provided further, that (w) no Holder that is a
competitor of the Company shall have any right whatsoever to conduct any
inspection of the Company's records and information; (x) in connection with any
such inspection, any such inspectors shall use their reasonable best efforts to
minimize any disruption to the operation by the Company of its business; (y)
records and information obtained hereunder shall be used by such persons only to
exercise their due diligence responsibility; and (z) records or information
furnished or made available hereunder shall be kept confidential and shall not
be disclosed by any such Holder, underwriter or inspectors unless (A) the
disclosure of such records or information is reasonably necessary to avoid or
correct a misstatement or omission in the Resale Shelf Registration Statement,
(B) the release of such records or information is ordered pursuant to a subpoena
or other order from a court or governmental authority of competent jurisdiction
or (c) such records or information otherwise become generally available to the
public other than through disclosure by such Holder, underwriter or inspector in
breach hereof or by any person in breach of any other confidentiality
arrangement. Each Holder agrees that information obtained by it as a result of
such
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inspections shall be deemed confidential and shall not be used by it as the
basis for any market transactions in the securities of the Company or its
affiliates unless and until such information is made generally available to the
public. Such Holder further agrees that it will, upon learning that disclosure
of such records or information is sought by a court or governmental authority,
give notice to the Company and allow the Company, at the expense of the Company,
to undertake appropriate action to prevent disclosure of the records or
information deemed confidential.
(n) The Company shall (i) cause its counsel to deliver an opinion and
updates thereof relating to the Securities in customary form addressed to the
Holders and the managing underwriters, if any, thereof and dated, in the case of
the initial opinion, the effective date of such Resale Shelf Registration
Statement (it being agreed that the matters to be covered by such opinion shall
include, without limitation, the due incorporation and good standing of the
Company and its material subsidiaries; the qualification of the Company and its
material subsidiaries to transact business as foreign corporations; the due
authorization, execution and delivery of the relevant agreement of the type
referred to in Section 2(1) hereof; the due authorization, execution,
authentication and issuance, and the validity and enforceability, of the
applicable Securities; the absence of governmental approvals required to be
obtained in connection with the Resale Shelf Registration Statement, the
offering and sale of the applicable Securities or any agreement of the type
referred to in Section 2(n) hereof; the compliance as to form of such Resale
Shelf Registration Statement and any documents incorporated by reference therein
and of the Indenture with the requirements of the Securities Act and the Trust
Indenture Act, respectively; and, as of the date of the opinion and as of the
effective date of the Resale Shelf Registration Statement or most recent
post-effective amendment thereto, as the case may be, a customary statement of
negative assurance regarding the absence from such Resale Shelf Registration
Statement and the prospectus included therein, as then amended or supplemented,
and from any documents incorporated by reference therein of an untrue statement
of a material fact or the omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading (in
the case of any such documents, in the light of the circumstances existing at
the time that such documents were filed with the Commission under the Exchange
Act); (ii) cause its officers to execute and deliver all customary documents and
certificates and updates thereof requested by any underwriters of the applicable
Securities; and (iii) use its reasonable best efforts to cause its independent
public accountants and the independent public accountants, if any with respect
to any other entity for which financial information is provided in the Resale
Shelf Registration Statement to provide to the selling Holders of the applicable
Securities and any underwriter therefor a comfort letter in customary form; and
covering matters of the type customarily covered in comfort letters in
connection with primary underwritten offerings, subject to receipt of
appropriate documentation as contemplated, and only if permitted by Statement
of Auditing Standards No. 72.
(o) In the event that any broker-dealer registered under the Exchange
Act shall underwrite any Securities or participate as a member of an
underwriting syndicate or selling group or "assist in the distribution" (within
the meaning of the Conduct Rules (the "Rules") of the National
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Association of Securities Dealers, Inc. ("NASD")) thereof, whether as a Holder
of such Securities or as an underwriter, a placement or sales agent or a broker
or dealer in respect thereof, or otherwise, the Company will assist such broker-
dealer in complying with the requirements of such Rules, including, without
limitation, by (i) if such Rules, including Rule 2720, shall so require,
engaging a "qualified independent underwriter" (as defined in Rule 2720) to
participate in the preparation of the Resale Shelf Registration Statement
relating to such Securities, to exercise usual standards of due diligence in
respect thereto and, if any portion of the offering contemplated by such Resale
Shelf Registration Statement is an underwritten offering or is made through a
placement or sales agent, to recommend the yield of such Securities, (ii)
indemnifying any such qualified independent underwriter to the extent of the
indemnification of underwriters provided in Section 4 hereof and (iii) providing
such information to such broker-dealer as may be required in order for such
broker-dealer to comply with the requirements of the Rules.
(p) The Company shall use its reasonable best efforts to take all
other steps necessary to effect the registration of the Securities covered by
the Resale Shelf Registration Statement contemplated hereby.
3. Registration Expenses. The Company shall bear all fees and expenses (but
not including any underwriting discounts or commissions or transfer taxes, if
any, attributable to the sale of the Securities which discounts, commissions or
taxes shall be paid by Holders of such Securities) incurred in connection with
the performance of its obligations under Sections 1 and 2 hereof whether or not
a Resale Shelf Registration is filed or becomes effective, shall bear or
reimburse the Holders of the Securities covered thereby for the reasonable fees
and disbursements of one firm of counsel, which firm shall be Xxxxxxx & Xxxxx
L.L.P. until another firm shall be designated by the Holders of a majority in
principal amount of the Debentures covered thereby to act as counsel for the
Holders in connection therewith.
4. Indemnification. (a) The Company agrees to indemnify and hold harmless
each Holder of the Securities and each person, if any, who controls such Holder
within the meaning of the Securities Act or the Exchange Act (each Holder and
such controlling persons are referred to collectively as the "Indemnified
Parties") from and against any losses, claims, damages or liabilities, joint or
several, or any actions in respect thereof (including, but not limited to, any
losses, claims, damages, liabilities or actions relating to purchases and sales
of the Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the Resale
Shelf Registration Statement or prospectus or in any amendment or supplement
thereto or in any preliminary prospectus relating to the Resale Shelf
Registration, or arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein in light of the circumstances in which
they were made, not misleading, and shall reimburse, as incurred, the
Indemnified Parties for any legal or other expenses
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reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action in respect thereof; provided
however, that (i) the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in the Resale Shelf Registration Statement or prospectus or in any
amendment or supplement thereto or in any preliminary prospectus relating to the
Resale Shelf Registration in reliance upon and in conformity with written
information pertaining to a Holder and furnished to the Company by or on behalf
of such Holder specifically for inclusion therein, and (ii) with respect to any
untrue statement or omission or alleged untrue statement or omission made in any
preliminary prospectus relating to the Resale Shelf Registration Statement, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Holder from whom the person asserting any such losses, claims,
damages or liabilities purchased the Securities concerned, to the extent that a
prospectus relating to such Securities was required to be delivered by such
Holder under the Securities Act in connection with such purchase and any such
loss, claim, damage or liability of such Holder results from the fact that there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Securities to such person, a copy of the final prospectus if
the Company had previously furnished copies thereof to such Holder, provided,
further, however, that this indemnity agreement will be in addition to any
liability which the Company may otherwise have to such Indemnified Party. The
Company shall also indemnify underwriters, their officers and directors and each
person who controls such underwriters within the meaning of the Securities Act
or the Exchange Act to the same extent as provided above with respect to the
indemnification of the Holders if requested by such Holders.
(b) Each Holder, severally and not jointly, will indemnify and hold
harmless the Company and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act from and against any
losses, claims, damages or liabilities or any actions in respect thereof, to
which the Company or any such controlling person may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the Resale
Shelf Registration Statement or prospectus or in any amendment or supplement
thereto or in any preliminary prospectus relating to the Resale Shelf
Registration, or arise out of or are based upon the omission or alleged omission
to state therein a material fact necessary to make the statements therein in
light of the circumstances in which they were made, not misleading, but in each
case only to the extent that the untrue statement or omission or alleged untrue
statement or omission was made in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the Company by or on
behalf of such Holder specifically for inclusion therein; and, subject to the
limitation set forth immediately preceding this clause, shall reimburse, as
incurred, the Company for any legal or other expenses reasonably incurred by the
Company or any such controlling person in connection with investigating or
defending any loss, claim, damage, liability or action in respect thereof. This
indemnity agreement
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will be in addition to any liability which such Holder may otherwise have to the
Company or any of its controlling persons.
(c) Promptly after receipt by an indemnified party under this Section
4 of notice of the commencement of any action or proceeding (including a
governmental investigation), such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 4,
notify the indemnifying party of the commencement thereof; but the omission so
to notify the indemnifying party will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in subsection (a) or (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnified party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnified party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof the
indemnifying party will not be liable to such indemnified party under this
Section 4 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action. An indemnifying party will not be liable for any settlement of
any action or claim effected without its written consent; provided, however,
that such consent will not be reasonably withheld.
(d) If the indemnification provided for in this Section 4 is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the one
hand and the indemnified party on the other from the sale of the Securities,
pursuant to the Resale Shelf Registration, or (ii) if the allocation provided by
the foregoing clause (i) is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof) as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
such Holder or such
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other indemnified party, as the case may be, on the other, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding any other provision of this Section 4(d), the
Holders shall not be required to contribute any amount in excess of the amount
by which the net proceeds received by such Holders from the sale of the
Securities pursuant to a Resale Shelf Registration Statement exceeds the amount
of damages which such Holders have otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
subsection (d), each person, if any, who controls such indemnified party within
the meaning of the Securities Act or the Exchange Act shall have the same rights
to contribution as such indemnified party and each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act shall
have the same rights to contribution as the Company.
(e) The agreements contained in this Section 4 shall survive
the sale of the Securities pursuant to the Resale Shelf Registration Statement
and shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
indemnified party.
5. Additional Interest Under Certain Circumstances. (a) Additional
interest (the "Additional Interest") with respect to the Debentures and
Conversion Shares that are Transfer Restricted Securities shall be assessed as
follows if any of the following events occur (each such event in clauses (i)
through (iii) below a "Registration Default"):
(i) If on or prior to the 90th day after the first
date of original issuance of the Debentures, the Resale Shelf
Registration Statement has not been filed with the Commission;
(ii) If on or prior to the 180th day after the first
date of original issuance of the Debentures, the Resale Shelf
Registration Statement has not been declared effective by the
Commission; or
(iii) If after the Resale Shelf Registration Statement
is declared effective (A) such Resale Shelf Registration Statement
thereafter ceases to be effective; or (B) such Resale Shelf
Registration Statement or the related prospectus ceases to be usable
(except as permitted in Section 5(b)) in connection with resales of
Transfer Restricted Securities during the periods specified herein
because either (1) any event occurs as a result of which the
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related prospectus forming part of such Resale Shelf
Registration Statement would include any untrue statement
of a material fact or omit to state any material fact
necessary to make the statements therein in the light of
the circumstances under which they were made not
misleading, or (2) it shall be necessary to amend such
Resale Shelf Registration Statement or supplement the
related prospectus, to comply with the Securities Act or
the Exchange Act or the respective rules thereunder.
Additional Interest shall accrue on the outstanding
Debentures and/or the issued and outstanding Conversion Shares
that are Transfer Restricted Securities over and above the
interest set forth in the title of the Securities from and
including the date on which any such Registration Default shall
occur to but excluding the date on which all such Registration
Defaults have been cured, at a rate of 0.25% per annum in the
case of(i) and 0.50% per annum in the case of (ii) or (iii) of
the sum of (x) the aggregate Applicable Principal Amount of such
outstanding Debentures and (y) in the case of any issued and
outstanding Conversion Shares, the aggregate Applicable
Conversion Price.
(b) A Registration Default referred to in
Section 5(a)(iii)(B) hereof shall be deemed not to have occurred
and be continuing in relation to the Resale Shelf Registration
Statement or the related prospectus if such Registration Default
has occurred solely as a result of (i) the filing of a
post-effective amendment to such Resale Shelf Registration
Statement pursuant to Section 1(d) or to incorporate annual
audited financial information with respect to the Company where
such post-effective amendment is not yet effective and needs to
be declared effective to permit Holders to use the related
prospectus or (ii) imposition of a suspension period pursuant to
clause (ii) or (v) of Section 2(b) and in the case of clause
(ii), the Company is proceeding promptly (subject to the
provisions of Section 2(h)) and in good faith to amend or
supplement such Resale Shelf Registration Statement and related
prospectus to describe such events; provided, however, that in
any case if such Registration Default occurs for a continuous
period in excess of 30 days, Additional Interest shall be payable
in accordance with the above paragraph from the day such
Registration Default occurs until such Registration Default is
cured.
(c) Any amounts of Additional Interest due
pursuant to clause (i), (ii) or (iii) of Section 5(a) above will
be payable in cash to the Record Holder on the Damages Payment
Dates with respect to the Debentures and Conversion Shares. The
amount of Additional Interest will be determined by multiplying
the applicable Additional Interest rate by, in the case of the
Debentures, the Applicable Principal Amount and, in the case of
the Conversion Shares, the Applicable Conversion Price,
multiplied by a fraction, the numerator of which is the number of
days such Additional Interest rate was applicable during such
period (determined on the basis of a 360-day year comprised of
twelve 30-day months), and the denominator of which is 360.
(d) The parties hereto agree that the Additional
Interest shall constitute a reasonable estimate of the damages
that may be incurred by the Holders of Securities (other than the
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Initial Purchaser) for a Registration Default and shall constitute liquidated
damages; the actual damages that the Holders of the Securities might sustain as
a result of a Registration Default would be difficult to ascertain; and the
payment of Additional Interest would be reasonable and just compensation for a
Registration Default.
(e) Certain Definitions. For purposes of this Section 5:
Applicable Conversion Price. The Applicable Conversion Price means the
Applicable Principal Amount divided by the Conversion Rate in effect as of the
next succeeding June 6 or December 6 following such Registration Default in the
case of the first such payment of Additional Interest with respect to a
Registration Default (and thereafter at the next succeeding June 6 or December 6
until the cure of such Registration Default) or, if no Debentures are then
outstanding, the last Conversion Rate that was in effect when the Debentures
were last outstanding.
Applicable Principal Amount. Applicable Principal Amount with respect
to each $1,000 principal amount at maturity of Debentures means the sum of the
initial issue price of such Debenture ($499.60) plus accrued original issue
discount with respect to such Debenture through the next succeeding June 6 or
December 6 following such Registration Default in the case of the first such
payment of Additional Interest with respect to a Registration Default (and
thereafter at the next succeeding June 6 or December 6 until the cure of such
Registration Default) or, if no Debentures are then outstanding, such sum
calculated as if such Debentures were then outstanding.
Damages Payment Date. Each June 6 and December 6 in the case of
Debentures and the Conversion Shares.
Record Holder. With respect to any Damages Payment Date relating to any
Debenture or Conversion Shares as to which any Additional Interest has accrued,
the registered holder of such Debenture or Conversion Shares, as the case may
be, 15 days prior to such Damages Payment Date.
Transfer Restricted Securities. Each Security until (i) the date on
which such Security has been effectively registered under the Securities Act and
disposed of in accordance with the Resale Shelf Registration Statement or (ii)
the date on which such Security is distributed to the public pursuant to Rule
144 under the Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act.
6. Rules 144 and 144A. The Company shall use its reasonable best
efforts to file the reports required to be filed by it under the Securities Act
and the Exchange Act in a timely manner and, if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Transfer Restricted Securities, make publicly available such other information
as is necessary to permit sales of their securities pursuant to Rules 144 and
144A. The Company covenants that it will take such further action as any Holder
of Transfer Restricted Securities may
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reasonably request, all to the extent required from time to time to enable such
Holder to sell Transfer Restricted Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rules 144 and
144A (including the requirements of Rule 144A(d)(4)). The Company will provide a
copy of this Agreement to prospective purchasers of Transfer Restricted
Securities identified to the Company by the Initial Purchaser upon request. Upon
the request of any Holder of Transfer Restricted Securities, the Company shall
deliver to such Holder a written statement as to whether it has complied with
such requirements. Notwithstanding the foregoing, nothing in this Section 6
shall be deemed to require the Company to register any of the Debentures
pursuant to the Exchange Act.
7. Underwritten Registrations. If the Holders of Transfer Restricted
Securities representing at least 25% of the total of the aggregate principal
amount of Debentures originally issued so elect, any one or more offerings of
such Securities pursuant to any Resale Shelf Registration shall be in the form
of an underwritten offering. If any of the Transfer Restricted Securities
covered by any Resale Shelf Registration are to be sold in an underwritten
offering, a nationally recognized investment banker or investment bankers and
manager or managers that will administer the offering ("Managing Underwriters")
will be selected by the Company. No person may participate in any underwritten
registration hereunder unless such person (i) agrees to sell such person's
Transfer Restricted Securities on the basis reasonably provided in any
underwriting arrangements approved by the persons entitled hereunder to approve
such arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting agreements.
8. Miscellaneous.
(a) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of Holders
of a majority of the then outstanding Conversion Shares constituting Transfer
Restricted Securities (with Holders of Debentures deemed to be the Holders, for
purposes of this Section 8, of the number of outstanding shares of Conversion
Shares into which such Debentures are or would be convertible or exchangeable as
of the date on which such consent is requested). Notwithstanding the foregoing,
a waiver or consent to depart from the provisions hereof with respect to a
matter that relates exclusively to the rights of Holders of Transfer Restricted
Securities whose securities are being sold pursuant to a Resale Shelf
Registration Statement and that does not directly or indirectly affect the
rights of other Holders of Transfer Restricted Securities may be given by
Holders of at least a majority of the Transfer Restricted Securities being sold
by such Holders pursuant to such Resale Shelf Registration Statement; provided,
that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence. Each Holder of Transfer Restricted Securities outstanding at
the time of any such amendment, modification, supplement, waiver or consent or
thereafter shall
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be bound by any such amendment, modification, supplement, waiver or consent
effected pursuant to this Section 8, whether or not any notice, writing or
marking indicating such amendment, modification, supplement, waiver or consent
appears on the Transfer Restricted Securities or is delivered to such Holder.
Each Holder may waive compliance with respect to any obligation of the Company
under this Agreement as it may apply or be enforced by such particular Holder.
(b) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, first-class
mail, facsimile transmission, or air courier which guarantees overnight
delivery:
(1) if to a Ho]der of the Securities, at the most current
address given by such Holder to the Company.
(2) if to the Initial Purchaser:
Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Fax No.: (000) 000-0000
Attention: Transactions Advisory Group
with a copy to:
Xxxxxxx & Xxxxx L.L.P.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx
(3) if to the Company, at its address as follows:
Diamond Offshore Drilling, Inc.
00000 Xxxx Xxxxxxx
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
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Attention: Corporate Secretary
with a copy to:
Xxxx Xxxxxxx & Xxxxxx LLP
000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxx III
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient's facsimile machine operator, if sent by facsimile
transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery.
(c) No Inconsistent Agreements. The Company has not, as of the
date hereof, entered into, nor shall it, on or after the date hereof, enter
into, any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders herein or otherwise conflicts with the provisions
hereof, other than any inconsistencies in any such agreement that have been
waived by the beneficiary thereof.
(d) Successors and Assigns. This Agreement shall be binding
upon the Company and its successors and assigns.
(e) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
(h) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
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(i) Securities Held by the Company. Whenever the consent or
approval of Holders of a specified percentage of principal amount of Securities
is required hereunder, Securities held by the Company or its affiliates (other
than subsequent Holders of Securities if such subsequent Holders are deemed to
be affiliates solely by reason of their holdings of such Securities) shall not
be counted in determining whether such consent or approval was given by the
Holders of such required percentage.
(j) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Securities, in addition to
being entitled to exercise all rights granted by law, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement, provided, that the sole damages payable for a Registration Default
shall be Additional Interest as expressly provided in Section 5 hereof. Subject
to the provisions of the preceding sentence, the Company agrees that monetary
damages would not be adequate compensation for any loss incurred by reason of a
breach by it of any of the provisions of this Agreement and hereby further
agrees that, in the event of any action for specific performance in respect of
such breach, it shall waive the defense that a remedy at law would be adequate.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement on
the Initial Purchaser and the Company in accordance with its terms.
Very truly yours,
DIAMOND OFFSHORE DRILLING, INC.
By: /s/ XXXXXXXX X. XXXXXXXXX
----------------------------------
Name: Xxxxxxxx X. Xxxxxxxxx
Title: President & Chief Operating
Officer
The foregoing Registration Rights
Agreement is hereby confirmed and
accepted as of the date first above
written.
CREDIT SUISSE FIRST BOSTON
CORPORATION
By: CREDIT SUISSE FIRST BOSTON
CORPORATION
By: /s/ ROME X. XXXXXX
---------------------------------------
Name: ROME X. XXXXXX
Title: Managing Director
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